Affordable Transit

Filling the MTA Gap with Debt

NYSCapitolPanorama

This article is the first in a series examining mechanisms to fund the MTA’s Capital Plan for 2015-2019. The agency that serviced over 1.75 billion subway riders last year — 5.6 million riders on an average weekday and 6 million on weekends — has proposed a $32 billion budget to fund standard maintenance and repair, service expansion and improvements, and continued construction of the 2nd Avenue line, among many other projects that will ease overcrowding, delays, and breakdowns of our trains, subways, and buses. Unfortunately, a $14 billion funding gap ($1B was was funded in the State budget approved in March) threatens the continued viability of the MTA. The Move NY Fair Plan is the only viable proposal on the table which can provide much of the funding needed to fill the gap, but unless serious discussions are had in Albany in the last weeks of the legislative session, the future of the MTA — and our lifeline to work, entertainment, shopping, and family & friends — is very much up in the air. And as the MTA goes, so goes the entire New York State economy.

In the coming days, we will look at fill-the-gap alternatives to the Move NY plan, none of which individually or collectively can bring faster, safer, fairer transportation to New Yorkers and many of which are dead on arrival: Filling the Gap with More Debt; Filling the Gap with a New Gas Tax; Filling the Gap with an Increased Sales Tax; Filling the Gap by Increasing the Payroll Mobility Tax; Filling the Gap by Reinstating the Commuter Tax; Kick the Can Down the Road: Doing Nothing.

I. Filling the Gap with More Debt

MTA finance chief Robert Foran floated one scenario at the MTA Board meeting last Monday, April 27: a 15% fare and toll increase to underwrite debt covering the unfunded gap of $15 billion. This figure comes from a report by State Comptroller Thomas Di Napoli last October. The study found that the financing costs for every new $1 billion in MTA debt are equal to a 1% fare and toll increase.

Agency head Thomas Prendergast quickly assured everyone that Foran was only speaking hypothetically, as MTA fares and tolls have already increased five times in the last eight years in part to cover existing debt of $34.1 billion. That’s more than the debt load of 30 nations. Or in starker terms, a 15% fare increase would raise the base transit fare by 41 cents, to $3.16 per ride from the $2.75 fare that just took effect in March.

That’s simply untenable and doesn’t factor in the equally devastating hit on commuter rail riders and on motorists using the MTA river crossings. For example, a round-trip toll on the Whitestone, Throg’s Neck, & RFK Bridges would jump from the current rate of $11.08 (EZ-Pass) to $12.74 (an increase of $1.66). And none of that increase would go to improving the city’s roads and bridges.

Isn’t there another solution?Move-NY-Logo-v09-rgb300

In February, the Move NY Coalition released the official Move NY Fair Plan, the comprehensive transportation proposal developed by former NYC Traffic Commissioner “Gridlock” Sam Schwarz after years of consulting with stakeholders across the region.

Fortunately, the Move NY Fair Plan offers a far more palatable, realistic, and equitable solution to MTA’s funding troubles: a “toll swap” that would effectively halve the tolls on the MTA bridges and offset the reduced revenue by placing tolls on the once-tolled-but-now-free, city-run East River crossings. In order that drivers receive benefits for paying into the system, the Move NY plan would provide $375 million in annual dedicated funding for the city’s dilapidated roads and bridges. The additional revenues raised — $1.275 annually — would go toward funding our transit system.

From a policy perspective, re-introduction of tolls on the East River bridges would encourage more efficient and productive use of the area’s transit and road networks. The current toll structure incentivizes drivers to “bridge shop,” which burdens the neighborhoods adjacent to the free bridges with gridlock, unhealthy air, and high rates of pedestrian accidents. Move NY’s more balanced pricing scheme would smooth out traffic flows, with a projected 15-20% faster travel within Manhattan’s Central Business District, and redirect heavy traffic onto the roads and bridges that were built for them.

Growing Support

Since February, the Move NY Fair Plan has gained editorial endorsements from The NY Post, The Daily News, The New York Times, Crains, and Newsday. A growing coalition of State and City elected officials have come out to champion Move NY as an answer to our transportation and transit troubles.2-17-15NYpost-editorialquote

Meanwhile, a Queens coalition led by Borough President Melinda Katz recently denounced the plan but offered no alternative. In their public announcement, they stated:

“Our city’s mobility and growth depends on more affordable, reliable and efficient mass transit. We recognize it is critical that we find more stable transit funding sources other than from the driving and riding commuters’ pockets to fill deep budget gaps. But we reject the notion that there is only one way to generate additional monies for the Metropolitan Transportation Authority and our region’s infrastructure.”

Alex Matthiessen, Move NY’s Campaign Director, challenged the the group’s failure to provide alternatives:

BP Katz & Co. don’t offer any solutions. If they have them, let’s hear them. What are those other ways? If BP Katz and Co. don’t have a more viable proposal, they should stand aside and let other leaders lead.

Put it all together and it’s clear that Move NY – not more fare-backed borrowing – is the surest, least painful, and fairest remedy to our transportation woes. Anyone who says differently — that it places an undue burden on residents in the city’s transit-starved deserts — is missing the big picture. Without Move NY, it’s impossible to balance the scales, whereby we all pay our fair share to keep New York moving faster, safer, and fairer.

Tell your elected leaders that you refuse to accept 15% fare and toll hikes to fund the MTA’s Capital Plan. The window of opportunity is closing soon.

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