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No, the MTA Can’t Afford Cuomo’s Transit Raids

I think most transit riders would laugh — cynically — at the idea that the MTA has more than enough funds to meet its needs. But this is exactly what the MTA’s chairman Tom Prendergast said when he learned that the state would be diverting $30 million from the MTA’s funding stream to balance the state budget.

Crowding on the 7 train platform. Photo: @lreynolds21363 via Gothamist

“Our needs are being met,” Prendergast said, apparently unwilling to speak out against his boss, Governor Cuomo.

Mayor de Blasio was equally sanguine about this raid on MTA funds. “We have to make sure the MTA has the resources they need. But from what I’m hearing at this point, they’re doing well,” de Blasio said.

Is this the same MTA that is regularly described in the press as “cash-strapped,” that made deep service cuts in 2009, leaving hundreds of thousands of New Yorkers with longer waits, more crowded platforms, or no local bus route at all?

When asked about the $30 million diversion, an MTA spokesperson noted that the MTA was actually receiving more state funds this year.

Technically he is correct. The state collects a number of taxes and fees that are then sent into a fund that is “dedicated” for transit. The economy is recovering, more tax revenue is coming in, and as a result the pot of transit-dedicated funds is larger than it has been in recent years.

And it’s true that the $30 million diversion represents a small percentage of the MTA’s $13 billion annual budget. One has to appreciate the amount of public funds that do support transit, either from special taxes or state and local general funds. Last year, $5.1 billion in subsidies helped the MTA run the largest transit system in the nation, which is slightly more than it took in at the farebox.

But there are several reasons why the state’s raid on transit funds is bad policy and is fiscally irresponsible.

First, this year’s raid is not an isolated incident but rather comes on top of $280 million in diversions since 2009. Worse, Cuomo intends to take at least $20 million from the state’s transit fund every year until 2031, adding up to another $350 million.

Second, the tax revenue that the MTA relies on is volatile and subject to the ups and downs of the economy. Tax revenue is up this year, but could just as easily drop in the event of the next recession. The MTA should be able to take advantage of the “good times” to prepare for the next recession.

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Instead of Reforming NYC Tolls, Ruben Diaz, Jr. Proposes Soaking the Bronx

Like the Tea Party adherents who are always going to equate walkability and sustainable transportation with a global UN conspiracy, some New York City electeds are always going to call road pricing “regressive” no matter how much the evidence suggests otherwise.

Bronx Borough President Ruben Diaz, Jr.

But Bronx Borough President Ruben Diaz, Jr. really ought to know better. Diaz has a piece in the Daily News attacking the Move New York plan, which would inject some reason into New York’s tolling system by raising rates in the congested heart of the city and lowering rates on less-trafficked crossings farther from the core, yielding significant funds for transit in the process. Not only would Diaz’s counter-proposal do nothing to solve the chronic traffic congestion that makes trips miserable for bus riders — to raise as much revenue as the Move NY plan, his proposal would also end up costing Bronx residents a lot more than toll reform.

Unlike the dyed-in-the-wool road pricing opponents New York got to know so well in 2007 — the Richard Brodskys and Lew Fidlers — Diaz doesn’t represent the region’s car-oriented edges. More than 60 percent of Bronx households don’t own cars, according to the 2000 Census [PDF].  The allegation of a “regressive tax” collapses when you consider that the average car-free household in the Bronx earns less than half as much as the average car-owning household.

Even in terms of the cost to drivers, though, the Diaz approach doesn’t add up. Diaz says it’s a certainty that the Move NY toll discounts on outer borough bridges won’t last. So that’s how he can dismiss the 40 percent or larger drop in rates on all four of the Bronx’s tolled bridges. But the Move NY plan needs enabling legislation from the state to move forward, so the new toll ratios would be enshrined in law.

Taking a page from Fidler, Diaz does float a counterproposal — a weight-based vehicle registration fee — that’s supposed to signal that he really does care about transit, but is destined to go nowhere.

To raise the same amount of money as the Move NY plan, about $1.45 billion per year, the registration fee assessed in the five boroughs would have to be raised by $785 per vehicle, reports Move NY analyst Charles Komanoff. Because car ownership is higher in the Bronx than in Manhattan, the Diaz proposal would actually cost his constituents much more than Move NY.

In the Bronx, the average cost per household would work out to $390, according to Komanoff, but just $187 per household in much wealthier Manhattan.

This is a significantly worse deal for the Bronx than the Move NY plan, which calls for Manhattan residents to shoulder a much greater share of the costs. Probably not what Diaz wants out of a transit funding plan.

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Cuomo Gets His Way, and Transit Riders Get the Shaft

Straphangers pack a subway platform in Queens this morning. The $30 million Governor Cuomo diverted from the MTA budget could have been used to address subway overcrowding. Photo: ##https://twitter.com/lreynolds21363/status/450610751632588800##@lreynolds21363## via ##http://gothamist.com/2014/03/31/mta_is_trying_to_break_your_heart.php##Gothamist##

Straphangers pack a train platform in Queens this morning. The $30 million Governor Cuomo diverted from the MTA budget could have been used to address subway overcrowding. Photo: @lreynolds21363 via Gothamist

Governor Andrew Cuomo won’t be denied. Overriding proposals from the Assembly and State Senate, the governor continues to pick the pocket of New York City’s transit system, diverting $30 million from the MTA in the state budget.

Cuomo had originally proposed a $40 million raid, so it could have been worse. But because this diversion will be used to pay off bonds that don’t mature until 2031, it sets a troubling precedent — Cuomo envisions yanking $20 million from the MTA every year to cover borrowing costs the state had previously promised to take care of.

Albany transit raids have become an annual rite in recent years, as the state government tries to make up for a structural budget deficit by treating the MTA like a piggy bank. While today’s raids aren’t as big as five years ago (advocates have significantly raised public awareness of them), Cuomo still managed to reach a new low this year. By keeping a $30 million diversion in the final budget, the governor overrode both houses of the state legislature, which had rejected any theft from the MTA in their budget proposals.

This time around, Cuomo also got a last-minute assist from MTA Chair Tom Prendergast, who said the agency never asked the governor to let it keep the money because its “needs are being met.” But what about the needs of transit riders?

While this transit raid won’t set off a round of service cuts, it also deprives the MTA of funds that could be used to expand service or defray future fare hikes. Significant service cuts enacted in 2010 have yet to be restored, and Cuomo’s budgetary monkey business makes it a lot harder to bring those trains and buses back. As the Straphangers Campaign and the Riders Alliance pointed out earlier this month, if not for this raid, the MTA would have funds to improve frequency and reduce crowding on several subway lines while expanding bus service on more than a dozen routes.

Cuomo has repeatedly refused to enact legislation that would make the impact of these raids more transparent to the public. This weekend New Yorkers got another reminder why.

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Fitch Ratings: Failure to Invest in Transit Could Hurt the Whole Economy

One of the country’s leading financial ratings agencies is warning that if America doesn’t change how it invests in transit, the whole economy could suffer.

After decades of steady growth, vehicle miles driven has stagnated in recent years. Americans are driving no more total miles now than in 2004. Image: ##http://www.investing.com/analysis/vehicle-miles-driven:-another-population-adjusted-low-206969##Doug Short/Investing##

After decades of steady growth, vehicle miles driven has stagnated in recent years. Americans are driving no more total miles now than in 2004. Image: Doug Short/Investing

“Public transportation investment strategies will need to transform if trends toward increased multifamily housing, declines in driving, and increasing public transportation usage continue over the long run,” Fitch said.

In an article published March 12, Fitch says there are signs of a major shakeup in U.S. transportation. The ratings group points to trends away from driving among millennials and an uptick in transit use. Fitch also cites record-breaking levels of multi-family housing construction, which represented almost one-third of new housing starts last year.

Fitch writes:

In our view, the transportation needs of the next 50 years will be markedly different from those of the past 50 years. U.S. policymakers must begin adapting their current decisions to these future needs. If these trends persist and meaningful policy changes are not made, the risk to the public transportation system would have negative implications for the entire economy.

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What Transit Riders Could Get If Cuomo’s Transit Raid Doesn’t Go Through

How much transit service could the MTA add if Governor Cuomo’s proposed $40 million transit raid doesn’t make Albany’s final budget? Here’s a taste, courtesy of the Straphangers Campaign and the Riders Alliance.

Photo: Wikipedia

Service that was cut from seven subway lines in 2010, serving 300,000 weekday riders, could be restored. More than a dozen weekday bus routes could be added across the five boroughs, plus weekend service for more than a dozen other routes. The LIRR could run more trains and MetroNorth could add cars.

It would all add up to quicker commutes, less crowding, and more freedom for New Yorkers to get around without a car.

Straphangers and the Riders Alliance based the potential service restorations and additions on the MTA’s estimates of cost savings achieved with the 2010 service cuts.

In their budget proposals, both the Assembly and the State Senate rejected the $40 million transit raid in the governor’s executive budget. The issue is expected to be decided during final negotiations this week between the legislature and Cuomo.

The Cuomo camp has tried to diminish the significance of the raid, which would compel the MTA to pay off bonds for capital projects that the state had previously promised to cover. The advocates’ list of foregone service helps bring home the point that there is in fact a very real cost whenever Albany decides to divert revenue from transit.

Here’s the full list of service that $40 million could buy, according to Straphangers and the Riders Alliance:

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Senate Joins Assembly in Rejecting Cuomo’s $40 Million Transit Raid

This week kicked off with news that Speaker Sheldon Silver would remove Governor Andrew Cuomo’s $40 million transit raid from the Assembly’s budget plan. Today comes word [PDF] that the State Senate has followed suit, rejecting the transit raid in its own budget resolution.

Photo: Matt Wade via Wikipedia

Photo: Matt Wade via Wikipedia

A united front from the Senate and Assembly provides a boost to advocates as the legislature begins two weeks of negotiations with Cuomo over the final budget, which covers a fiscal year beginning April 1.

It’s also a step up from last year, when a $20 million raid was rejected by the Senate but remained in the Assembly’s resolution and was included in the final budget. “We have a much stronger hand going into the negotiations [this year],” said Nadine Lemmon of Tri-State Transportation Campaign.

The governor’s office has claimed that this budget maneuver does not count as a raid because it’s taking taxes dedicated to MTA operations and diverting it to service debt that funds MTA capital needs. But Comptroller Tom DiNapoli calls it a transit raid, and advocates point out that it reneges on a commitment the state made over a decade ago and shifts funds away from the MTA to effectively create new money on the state’s balance sheet.

Even if the $40 million transit raid is removed from this year’s budget, Cuomo is likely to attempt similar moves in the future to pay off the state bond with MTA funds. His financial plan includes annual raids of $20 million, which would total nearly $350 million by 2031.

“Three hundred and fifty million dollars is a big chunk of change. You can’t bleed the authority in that manner and expect them to perform,” Lemmon said.

Another one of the governor’s hits to MTA revenues is also having ripple effects in the Senate. Cuomo’s plan to deepen Verrazano-Narrows Bridge toll discounts for truckers and Staten Island residents would cost $14 million annually, with the MTA and the state splitting the cost evenly. That kicked off a flurry of press releases and events by Brooklyn legislators angling for a discount for their constituents, too.

Now, they’re using the Senate budget plan to call on the MTA to study and recommend VNB toll discounts for non-Staten Island residents who drive over the bridge. Wholesale reform of New York’s broken toll system, as the state begins to figure out how to fund the MTA’s next multi-billion dollar capital plan, is not on Albany’s agenda.

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Without Action From Cuomo, Subways Doomed to Endless State of Disrepair

Governor Andrew Cuomo is pushing for $2 billion in tax cuts in his next budget, citing growing surpluses. But a new report on New York City’s infrastructure from the Center for an Urban Future makes it clear that there is no surplus — the state is responsible for billions in unfunded infrastructure repairs to city subways.

Like his toll cuts, Cuomo’s planned tax cuts will hurt New Yorkers who depend on transit. Photo: AP/SI Advance

All told, the city faces a $34 billion gap between basic repairs and maintenance and the amount of money available over the next five years. Surprisingly, a large chunk of this funding gap is attributable to New York’s subway system, which has a $10.5 billion backlog of needed maintenance and repair.

Thirty-seven percent of subway signals have exceeded their 50-year useful life, and 26 percent are over 70 years old. Signal upgrades are essential because modern signals dramatically increase the number of trains that can run in an hour. When the L train’s system was upgraded, the MTA increased the number of rush hour trains from 15 to 26.

Subway stations have gotten to such a state of disrepair, says the report, that a former MTA spokesman confesses, “The MTA has basically conceded that you will never get to a state of good repair… It’s simply not possible.” Under current funding levels, at least.

Funding the subways isn’t the city’s responsibility. The MTA is under the control of the governor, who appoints the authority’s president and nominates its board members. But the governor has largely ignored the MTA’s needs. Instead, Cuomo threatens to take $40 million in dedicated revenues from the MTA in the next budget.

He also pushed the MTA board to cut tolls on the Verrazano-Narrows Bridge (again, less money for the MTA), a move so fiscally irresponsible that it led former Lieutenant Governor Richard Ravitch to testify that it may be illegal.

The MTA’s shortfall isn’t entirely Cuomo’s fault. In 1975 the federal government contributed 78 percent of the MTA’s capital budget, “but only 25 percent of the MTA budget for 2010-11,” the report notes.

But that certainly doesn’t excuse the governor for actually taking money from transit. Cuomo should assume leadership of the issue and make the case for more transit funds to Congress and the president.

Instead, Cuomo focuses on cutting taxes for corporations and property owners. The governor argues that cutting taxes will make New York more “business friendly.” But to underfund critical infrastructure is to harm the state’s business climate. Until we fund basic repairs and maintenance, there simply is no surplus.

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Assembly to Reject Cuomo’s $40M Transit Raid; No Word From State Senate

Assembly Speaker Sheldon Silver will look to block Governor Cuomo’s $40 million transit raid, according to the Daily News.

Cuomo’s executive budget proposes to divert $40 million in dedicated transit revenue to pay for MTA bonds the state had pledged to pay off from the general fund. The move could cost the MTA around $350 million over the life of the bonds.

Last week a group of 32 Assembly members called on Silver to restore the funds in the legislative budget, which is scheduled to be voted on Wednesday.

From the News:

The Assembly will reject the governor’s plan in a formal response it unveils this week to Cuomo’s budget proposal, a source close to Speaker Sheldon Silver said.

“These funds could be used to offset fare increases, restore past service cuts or help fund the MTA capital plan,” the source said.

Sources tell Streetsblog there is no word yet from the State Senate. When Cuomo put a $20 million raid in the budget last year, the Senate removed the provision from its budget proposal. The Assembly went along with Cuomo, however, and the cut was enacted.

This is a developing story. We will post updates as we get them.

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32 Assembly Members Want to Reverse Cuomo’s Transit Raid. Where’s Shelly?

dendekker cropped

Assembly Member Michael DenDekker, with fellow members Nily Rozic, Richard Gottfried, and Jim Brennan behind him, speaks at Sunday’s rally against Governor Cuomo’s proposed transit raid. Not present: Shelly Silver.

It’s crunch time for the state budget, and so far Assembly Speaker Sheldon Silver has not said a word about undoing the $40 million MTA raid in Governor Andrew Cuomo’s executive budget, even though 32 Assembly members have called on Cuomo to restore the funds [PDF].

Cuomo’s budget proposal shifts $40 million in bond obligations to the MTA, reneging on the state’s earlier promise to pay off the debt from its general fund. The cost-shifting sets a precedent that could cost the MTA nearly $350 million over the life of the bonds. That’s money the agency won’t have to expand service.

Last year, when Cuomo snuck a $20 million raid into the state budget, the Republican-led State Senate actually removed the provision from its proposal, but the Silver-led Assembly did not, and it was ultimately enacted.

Where’s Shelly?

Now the Assembly and the State Senate are putting the finishing touches on this year’s budget proposals, and Silver, who leads a caucus with dozens of members opposed to Cuomo’s transit raid, is the logical person to put a stop to it. So far, though, no word from Shelly.

Silver’s Manhattan Assembly district neighbors — Deborah Glick and Richard Gottfried — have both signed on to the letter opposed to the transit raid. But the speaker’s office has not returned a request to comment.

“When Albany takes money out of the transit budget, riders end up paying more,” said Riders Alliance Executive Director John Raskin. “Transit riders need both the Senate and the Assembly to stand up for us in the budget process.”

The Assembly and the Senate are expected to submit budget proposals in the middle of next week, with the actual dollars and cents getting hammered out as soon as today. If the Assembly speaker who represents transit-rich Lower Manhattan won’t stop Cuomo from raiding transit, who will?

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The Tappan Zee Transit Task Force Has Issued Its Report. Now What?

Looks nice, but will the state follow through on building this system before the new Tappan Zee Bridge opens in 2018? Map: New NY Bridge

Nice transit map, but will it be complete when the new Tappan Zee Bridge opens in four years? Map: New NY Bridge

On Friday, the Tappan Zee Mass Transit Task Force released its final report [PDF], recommending bus improvements across Westchester and Rockland counties that could be completed when the new Hudson River span opens in 2018. But the path to implementation is vague at best. If these bus upgrades are going to materialize, task force members say it’s up to the governor to push for them.

The transit task force, created by Governor Cuomo in exchange for the backing of his bridge replacement plan by county executives more than 18 months ago, represents the first regional transit planning for the area since the governor ended previous Tappan Zee replacement studies three years ago.

Calling transit one of the “obstacles to building a replacement for the TZB,” the report says, “Governor Cuomo decided to put the development of transit proposals on a separate track from the bridge replacement project.”

The plan released Friday calls for a watered-down version of Bus Rapid Transit, with the potential for future bus or rail expansions after 2018. It is short on details about cost, funding, and implementation.

The bus system would use 50 buses on seven routes. Every route would have buses arrive every 10-15 minutes during peak hours and every 20-30 minutes at other times. The routes are focused on the I-287 corridor and downtown White Plains, with a few spurs to nearby destinations, plus Yonkers and the Bronx. The new system is expected to attract 10,150 new riders daily and speed bus trips by 25 percent on local roads and 20 percent on I-287.

Capital improvements to increase bus speed focus mostly on queue-jump lanes, which allow buses to get a head-start on traffic at red lights at selected intersections, and transit signal priority, which can hold green lights for buses.

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