MTA Expects Ridership To Fall Flat In 2009

A few days ago Matthew Sweeney of AMNY had a report about the MTA’s projection for 2009 ridership numbers to fall flat. Here is his report:

After more than a decade of growth in transit ridership, the MTA is predicting that bus and subway straphanger numbers will fall flat in 2009.

Ridership on subways has grown dramatically this year — increasing by more than four percent — as people have run from the rising price of gasoline. The subway crowds have so far more than made up for a slight drop in bus ridership. But the MTA believes that days of increases are soon coming to an end. The MTA is expecting 2.35 billion bus and subway riders this year and 2.34 billion in 2009.

“The leveling off is due to two factors,” said Jeremy Soffin, a spokesman for the Metropolitan Transportation Authority. “We grew more than expected in 2008 due in part to high gas prices and two is the loss of jobs due to the cooling off of the economy.”

The loss of jobs has a direct effect on the numbers of riders. And the agency’s forecasters expect that job losses will outpace any new riders who choose the subway to avoid the high cost of gasoline.

Click here to read his full report.

I happen to agree with the Straphangers Campaign’s Gene Russianoff when he said “I think predicting is a little risky and there are conflicting factors.” How can anyone trust these projections when just a 5 months ago, the MTA was forecasting ridership growth through 2012? I for one do not feel the growth will just fall flat in 2009. I would not be surprised if it did not fall at all. With the cost of driving seeming to become even more of a burden, drivers will continue to flock to mass transit even with fares expected to rise in the near future.

I seriously hope the MTA is not using these projections to make any cuts in service. We already need more service than we currently have so they better not pull any funny business. However this is the MTA we are talking about so funny numbers are just part of the package.

xoxo Transit Blogger

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Subway General Manager Program Coming Soon

Caught in the mess of what has been a really negative amount of press for the MTA was MTA CEO/Executive director announcing plans to have a general manager for each individual subway line. Pete Donohue had the report:

The MTA is gearing up for a major subway management shakeup to improve service on the debt-ridden, delay-plagued system, the Daily News has learned.

This fall, individual lines systemwide are expected to get their own chiefs with broad authority to run them like their own mini-railroads, officials said Tuesday.

Click here to read the full report.

I am not sure why media outlets are acting like this news is new. They announced plans to do this back in December. The initial pilot program was implemented on the 7 & L lines respectively. It was known that if the program went well, it would be implemented on the remaining lines.

I am not going to repeat my opinions on the plan as they can be seen by clicking the link in the above paragraph.

xoxo Transit Blogger

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The Nepotism Continues

A story that has come up a couple of times on this blog was the rerouting of the Q54 to serve the Shops at Atlas Park. Many have felt the reroute was a clear sign of nepotism to benefit MTA Board Chairman Dale Hemmerdinger who happens to be the co-owner & president of ATCO Properties which owns the mall.

However if you thought the initial reroute was a sign of nepotism, wait until you read about how yet another bus is being rerouted to serve the Shops at Atlas Park. Nicholas Hirshon of the New York Daily News has the report:

The MTA will reroute another bus past its chairman’s family-run shopping mall in Queens, defying a community board’s 39-to-1 vote against the switch and marking the second such reroute in just over a year, officials said.

Starting Sept. 1, the Q45 bus – which runs from Jackson Heights to Middle Village – will extend its route about 1.4 miles south to stop at the Shops at Atlas Park in Glendale, co-owned by MTA Chairman Dale Hemmerdinger.

In July 2007, the MTA diverted the Q54 a few blocks off its old path so it, too, could stop at Atlas Park.

Critics charge Hemmerdinger orchestrated both reroutes to benefit the mall – run by his son, Damon – despite nearby residents’ concerns about noise, traffic and pollution.

“This is like sticking it to the people of Glendale,” said Gary Giordano, district manager of Community Board 5. “This is a crazy move that is going to hurt [Atlas Park’s] goodwill with the community even further.”

The board, which plays an advisory role in city government, voted overwhelmingly against the Q45 reroute on June 11.

A month later, on July 11, MTA Bus President Joseph Smith sent a letter to Giordano thanking the board for its input – but announcing the reroute would still go forward.

Dorie Figliola, one of 39 board members who voted against the Q45 switch, figured Dale Hemmerdinger guided it through to boost business at Atlas Park.

“If the shoe fits, I guess you could wear it,” she said. “There’s people in other areas that have been asking for buses … and they can’t get them.”

But MTA Bus spokesman Salvatore Arena denied that Dale Hemmerdinger – confirmed as MTA chief on Oct. 22 – pushed for the bus reroutes.

“The chairman played no role whatsoever in this decision, which we began exploring long before his appointment,” Arena said in an e-mail. “We went ahead with it because it makes good sense as transit policy.”

In Smith’s letter, he defended reroutes past malls as a way to let customers “access these malls and patronize their shops.”

Smith also wrote that MTA Bus “would not make this revision if we thought that it did not provide benefits to the public or results in an inconvenience to our customers.”

Damon Hemmerdinger, the mall’s development director, noted that the MTA dropped its original plan to send the bus to Myrtle Ave. in Ridgewood – six blocks further than Atlas Park.

He said locals preferred the MTA’s eventual choice: a shorter route and the Q45 turning around in Atlas Park. “The final route is the route that the community leadership asked for,” Hemmerdinger said.

The continuous display of nepotism is disgusting. There is no way the MTA could legitimately justify the rerouting of this route. The reroute comes on a line that was just fine playing the role it did without being changed to benefit a mall. This route will not see any increase in ridership towards the mall so when they look over the numbers, I hope they realize that catering to leadership instead of your customers was clearly uncalled for.

xoxo Transit Blogger

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My Thoughts On The Proposed Fare Hikes

As I had mentioned previously, I wanted to attend yesterday’s presentation of the MTA’s financial plan & preliminary budget. Unfortunately due to business appointments in Long Island, I could not make it. However I did take the time to watch the entire board meeting & subsequent presentation live via the MTA’s webcast.

The board meeting in itself did not contain any surprises. I was a little disappointed in Gene Russainoff’s speech during his speaking time. Maybe he was saving the main course for when it really counts. Anyhow the first major observation I picked up on was the tone of some of the board members. I seriously think their financial situation is worse than even they thought it would be considering the circumstances. I was glad to hear them repeatedly state that the idea of cost cutting would not magically make the deficit disappear.

For years many have felt the MTA is clearly at fault for squandering their money away. While these claims have some legitimacy based on past & some current choices, it is obvious that it isn’t the sole reason they face an almost $1 billion dollar budge deficit. All the cost cutting in the world will barely make a dent in the overall deficit. As I have stated on repeated occasions, it is clearly up to the elected officials on all levels to properly fund our transit infrastructure.

Speaking of which I was very disappointed to hear Elliot backpedal when asked if the MTA should hold the elected officials more accountable for properly funding the system. While it might sound wise to say they must determine what would be a fair share, I strongly disagree with the stance. If anything our government should fork over extra to partially make up for all the times they railroaded the agency out of much needed & deserved funding.

Another concern I have is the Ravitch Commission which was setup by current New York Governor David Patterson. I understand the point to this committee & more so what Richard Ravitch accomplished the first time he was called on by the MTA to help in dire financial times. However I get the sense that some expect this commission to magically cook up the recipe to save the day like MacGyver used to do back in the late 80’s to early 90’s.

Looking at the numbers from Elliot’s presentation led me to asking myself the same question. Can a potential fare hike not only next year but in 2011 be averted? I say yes but it isn’t because of the proposed budget tightening from within the MTA itself. It is clearly in the hands of our elected officials who up to this point are unwilling to provide the proper funding to the system that in a way is a key to the overall economy.

What do our elected officials not understand? Our transit infrastructure needs major amounts of funding to keep up with not on a state of good repair but handle the continued growth throughout the tri-state region. If our transit system crumbles, the economy will be the next domino to fall down. If they need any proof of this, go back to the transit strike of 2005 which crippled the city’s transportation system. The local economy took a major hit over that few day period due to our system not moving around the millions of people that it does daily. Now if they thought that was bad, just imagine what our economy will turn to if the system falls in a prolonged period of shambles.

The current funding process is clearly dated & does not serve the best interests of the tri-state area. No longer are the days here where Albany leads New York to greener pastures. Without a strong NYC economy, the state is in a complete bind from all angles. Unfortunately our leaders treat the funding of the MTA the same way the agency does to the G Train, an unwanted stepchild.

Why can’t they realize that something is clearly wrong when the financial health of our transit infrastructure is dependent on a cyclical market such as real estate to determine if it will be a good or bad year financially. This is completely unacceptable in a society where more & more people are turning to mass transit to get from “Point A” to “Point B”. We all hear how putting less cars on the road is good for the environment & how the masses are encouraged to take mass transit. Well if you really feel this way, provide the proper funding to maintain & improve our transit infrastructure. Stop punishing the riders who are doing what you wanted all along!

While I write this, I would like to call attention to Second Avenue Sagas’ own Benjamin Kabak who feels the MTA should double fares. Here is a sample of a few of his points:

Let’s start with an unpopular premise: The fares for the New York City subways are far too low, and they’re kept at low levels artificially by politicians looking to curry favors with voters.

If the MTA were to raise the base fare to $4 and the cost of Unlimited Ride 30-Day MetroCards to $120 — still a meager sum — people would complain, but they would still ride the trains. Under this fare structure, the MTA might make inroads into their budget crisis.

Meanwhile, politicians, falsely claiming populism, opted against congestion pricing, a measure that would have guaranteed the MTA at least $400 million a year annually for operating costs. Noticeably absent from the fare hike coverage is mention of how, with congestion pricing, that $900 million deficit would be cut in half.

New Yorkers won’t admit that subway fares are low — artificially so — and would still be a good deal even doubled. We want a top-line subway system that’s clean and efficient, but we don’t want to pay. These are irreconcilable differences, and something has to give. So let’s raise those fares until Albany is forced to lay out the big bucks.

I will first begin with my main idea & that is the MTA should not double the fares. One thing I have noticed from him over time is his belief that our fares even with increases are quite paltry compared to the amount of service we get. I ask are they really?

Every time straphangers turn around, they get to hear or read a report of how buses & subways are running behind schedule. In some areas instead of an increase in service to match growth in ridership, we get the same amount of pre-growth service or even worse reductions. So once again are the fares really too low? Is this kind of service acceptable because we pay such a “paltry” amount for fares? I think not & many riders would echo the same sentiment.

I am a numbers guy & understand why on “paper” it would seem to be a wise idea to double the current fares. However as I stated above, if the current service is not worth what we pay now, what makes one think it will be worth paying double for it? By doubling fares on riders, you are just adding to the financial burden experienced by millions of tri-state area residents. While on “paper” the fares are low, when you are struggling to make ends meet & most times barely doing so if at all, asking riders to pay more much less double is not the right way to go about doing things. I would not be so sure that “they would still ride the trains.”

Readers of this blog know just where I stand on congestion pricing. Once again I see it being trumpeted as a huge saving grace for the MTA’s financial woes. I will continue to call bullshit on that every single time. I have asked this question numerous times, show me any sort of proof that congestion pricing was nothing more than an excuse to collect revenue for the city in a form of a tax & put a burden on drivers as if they grow money on tress. The plan was nothing more than a modernized version of “Robbing Peter to Pay Paul”. Such proposals will only end up hurting a majority in the end. The plan should be noticeably absent from fare hike coverage as it is & always will be a complete sham.

Lastly as I said, doubling the fares for the current system in place would not be a good deal. To even think so is mind boggling in my opinion. Come talk to me when we have a completely modernized system from equipment to facilities & the stations themselves & I’ll agree with you.

You are right Benjamin, we as riders do want a “top-line subway system that’s clean and efficient” & do not want to pay for it. Why not? Because we as riders should not have to shoulder the majority of the costs to provide such a system. Our elected officials should come up with the money to provide a system we rightfully deserve as it benefits everyone in the long run.

Asking us to once again shoulder more costs in such struggling times is completely irresponsible & irrational. Doing such a thing is only encouraging our government to continue to short change the MTA as they feel the riding public can make up for their purposeful shortcomings. Instead of irresponsibly raising fares, the MTA should do everything & I mean everything possible to get all the money they rightfully deserve & take no prisoners in doing so.

Now that is what is truly needed regardless of what the “numbers” look like on paper. Now is the time to put an end to the never ending mickey mouse bullshit & take care of business. You are right Benjamin, “something has to give” & it sure should not be “us”.

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MTA’s Preliminary 2009 Budget & Four Year Financial Plan

A very short time after MTA CEO/Executive Director Elliot Sander finished his presentation on the MTA’s financial plan, I received an e-mail highlighting the main points. Here are those details:

The Metropolitan Transportation Authority (MTA) today released its Preliminary Budget for 2009 and proposed Four-Year Financial Plan for 2009-2012. The MTA Board will not consider a final budget until December, but the July plan allows for an extended period of public discussion about the MTA’s finances and budget proposals.

The proposed plan reflects sobering developments that have occurred since the last Plan was issued in February 2008, specifically rising fuel costs and the precipitous drop in real estate tax revenue to the MTA. The July Financial Plan assumes an increase of $81 million in 2008 and $127 million in 2009 for fuel costs, and reduced real estate tax projections of $201 million in 2008 and $242 million in 2009. These are the primary reasons that the $216 million budget deficit projected in February for 2009 has grown to over $900 million.

“The proposed plan acknowledges that despite the fiscal crisis we’re facing, the MTA must first cut our own costs and tighten our belt before asking our customers or government partners for more money,” said Elliot G. Sander, MTA Executive Director and CEO. “We have taken extraordinary measures to become a leaner organization, and we have asked all of our funding partners to help close the gap left by rising fuel costs and plummeting real estate revenues.”

To close this gap, the MTA proposed a series of actions that spreads the responsibility among the MTA and its agencies, its labor force, governmental partners and customers, beginning with significant MTA cost-cutting. No service reductions were proposed.

• MTA actions: The Plan already assumes that each MTA agency will do significant belt-tightening, cutting costs by 6% over four years. These cuts come on top of 5% cuts made by the authority between 2004 and 2007. To help close the gap, the Plan proposes an additional $45 million in cuts ($15 million in 2008 and $30 million in 2009). These cuts come even as ridership continues to rapidly grow.

o In addition, the MTA will take an inter-agency loan of $135 million to reduce the gap in 2009 and 2010. $120 million in funds that had been allocated from the 2006 surplus but not yet committed will also be transferred back to the operating budget in 2008 to be used for future gap-closing. Finally, MTA will reduce its subsidy to Long Island Bus by $4 million annually, returning to its historical $10 million allocation, and will begin charging official city, state and county vehicles at Bridge and Tunnel crossings, yielding an additional $10 million annually.

• Labor: The plan assumes that MTA employees will make a modest contribution through negotiation of new contracts.

• MTA Customers: Customers would be asked to contribute through a fare and toll increase that would take effect in July 2009 and yield an 8% increase in fare and toll revenues. This increase would effectively move forward by six months the 2010 increase that had been announced as part of the MTA’s plan to adjust fares and tolls every two years to keep them level with the rate of inflation.
• Government partners: The February Plan assumed additional governmental aid of $600 million beginning in 2010; the MTA will now seek more than $300 million of that aid in 2009, including a list of proposed changes:

o Full reimbursement of lost fares ($104 million) associated with providing peak-hour half-fare discounts to seniors ($15 million) and reduced fares to school children, not currently reimbursed by the City or the State, ($89 million). The City currently pays $13.8 million annually for seniors and the State and City currently pays $90 million annually ($45m each) for school fare reimbursement, which has not changed since 1995.

o $113 million in 2009 from the City to increase its funding of Paratransit to 50%.

o $50 million annually from elimination of State real estate tax loopholes.

o $59 million between 2008 and 2009 in State tax restorations.

These represent a series of proposed changes that will improve the MTA’s bottom line. It is not exhaustive, only illustrative. Other actions taken by the MTA’s funding partners could substitute for these examples.

In addition, the MTA will ask the federal government to eliminate federal mandates that cost the MTA $62 million annually.

As a result of these and other gap closing actions, the MTA expects to carry a $15 million surplus into 2010, helping to lower that year’s forecast deficit to $250 million. Without these measures, budget gaps are expected to grow to more than $2.3 billion in 2012, potentially requiring outsized fare increases and service cuts.

“The MTA’s July Financial Plan is just the start of the discussion about our finances,” said MTA Board Chairman H. Dale Hemmerdinger. “The Board looks forward to a productive public dialogue and will be working closely with the Ravitch Commission appointed by Governor Paterson to address the MTA’s ongoing fiscal issues.”

More information on the Plan is available online at mta.info. The complete plan will be online later this week.

I will get into my thoughts on the board meeting, presentation, & future in the next entry.

xoxo Transit Blogger

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