At a morning workshop about the challenges to funding transit during an economic downturn, Ravitch spoke about the current impasse in Albany that's putting New York's transit system at risk:

The difficulty, politically, in my judgment, is very obvious. There are very few short-term dividends, for people who run for office, in long-term investments. They don’t get the benefit out of it. It doesn’t have the same electricity to it as keeping the fare low. The benefits may not be realized until future generations. That is a political problem.

People are going to have to bite the bullet, in terms of usage charges and various taxes that will generate the revenue streams we need in order to build.

Congressman Jerrold Nadler, who served in the state legislature when the MTA was emerging from the financial catastrophe of the 1970s, added this perspective:

The 1970s crisis allowed us in the 80s to put new revenue streams in place and implement the original MTA capital plan. We had the ability to do these things because people remembered the bad times. But then you start to get complacent.

The politics in the legislature is more difficult now than it used to be. The Senate has switched parties; Republicans would like it to go back the other way. The Republicans won’t vote for anything and the Democrats can't unite. The only way around that, frankly, is for a few Republicans to step up to the plate. How do you do that? The leadership could step up and do a deal. It takes delicate political negotiating behind the scenes, and whether the public-spiritedness is there, I’m not at all sure.

During the Q&A, federal funding for transit service came up. Veronica Vanterpool of the Tri-State Transportation Campaign asked the panel about the budget crisis now facing transit agencies across the country. The feds used to fund transit service, she noted, but they don't anymore, and the stimulus bill failed to include operating assistance for transit. She asked why the federal policy changed in the first place, and what are the impediments to operating assistance now.

Nadler explained:

The Republicans who took over Congress in the 90s were ideologically opposed to operating assistance; they killed it. We’re going to try to do it again. (The House passed a bill last year that would have granted some operating assistance, but it did not clear the Senate.) There is a fixed determination in the House Transportation and Infrastructure Committee to restore operating assistance at this point.

New York City DOT chief Janette Sadik-Khan, who also heads the National Association of City Transportation Officials, said that words matter when pushing policy:

Language is important. When we talk about operating assistance, you would think we were talking about giving crack to cities. If we start to talk about energy independence grants, it starts to resonate a little better on the Hill.

Here's another highlight from Sadik-Khan, which she delivered during a plenary session about how federal policy needs to adapt and improve:

For 50 years we have had no national vision for transportation. We are working under an outdated mission, with outdated institutions. Our competitor nations are not saddled with that. We are increasingly a metropolitan nation, but our institutions do not reflect that. NYCDOT is larger than two-thirds of the state DOTs, and yet we do not have direct access to federal transportation funds. I am hobbled by the fact that we can't access the funds that we need.

Photo: Brad Aaron

While making the seemingly obvious argument that maintaining a healthy transit system is vital to the region's economy, the piece (behind the Crain's pay wall) lays blame on the Pataki administration -- during which Shaw previously served as MTA CEO -- for having "loaded up the MTA with debt that’s now coming home to roost."

[Sander] has become a target for those who believe the MTA is bloated and wasteful. In truth, Mr. Sander has wisely streamlined operations and cut costs in his two years in the post. He hasn’t solved all of the MTA’s problems. Who could in such a short time? And he hasn’t been the most effective politician in selling what he has done. But is that really a fault? Shouldn’t the job go to a seasoned transportation professional rather than a politician?

We asked MTA spokesman Aaron Donovan about cost-cutting measures initiated under Sander. The list is pretty extensive. Donovan points to the following efficiencies imposed "even as demand is at levels not seen since the early 1950s": elimination of 410 administrative positions; establishment of Regional Bus Operations, merging three companies into one; creation of a Business Service Center to "consolidate duplicative back office functions"; assignment of managers to oversee individual subway lines; formation of a blue-ribbon panel to "encourage competition and increase bidding on capital construction projects"; and increases in advertising revenue "from $38 million in 1997 to $125 million in 2008."

In addition, says Donovan:

Budget increases in recent years have come from uncontrollable factors like increases in debt service, which cost the MTA $793 million in 2002 and is projected to rise to $2.3 billion by 2012. But we are successfully trimming the expenses that we have control over. From 2004 to 2007, the MTA reduced its controllable costs by five percent. Building on that reduction, Lee Sander called on the MTA and its agencies to cut our budgets by six percent over four years. As the economic picture has darkened, he accelerated that six percent cut so that it is now required to take place over three years instead of four. All told, these cuts will result in a cumulative 11 percent budget cut.

Crain's editors also called on local business leaders -- Republicans in particular -- as well as the Real Estate Board of New York, to get behind the "fair and equitable" Ravitch plan to bolster MTA finances.

Do the likes of, say, Carl Kruger, care about Sander's streamlining efforts as long as they can continue to cast the MTA as the villain of the funding debacle?

Photo: The Daily Politics

Newsday filed this report on the MTA Finance Committee meeting (as live-blogged by Second Avenue Sagas), where members voted to recommend revenue-saving measures to the full board, now set to make its decision on Wednesday:

MTA board chairman H. Dale Hemmerdinger urged the agency's finance committee to adopt the fare hikes and service cuts even though he called them "horrific."

"This represents as good a job as human beings can do to divide the pain as equally as we can," he said.

The vote took place as state lawmakers in Albany sought to reach a compromise on a bailout plan that would avoid the worst of the planned fare increases and service cuts.

At a news conference after the committee vote in Manhattan, Hemmerdinger was asked if he had any message for Albany. He said, "How about: 'Help!'"

In Albany, Governor Paterson engaged in what Liz Benjamin of The Daily Politics described as "a game of political chicken" when, flanked by a silent Malcolm Smith and Sheldon Silver, he urged the MTA to go ahead with higher fares and service cuts without waiting on assistance from the legislature.

"Delaying action, to me, would just ring too true to what's gone on in Albany too many times," Paterson said. "I'm not in favor of delaying any action that was scheduled."

In Fare Hike Four news, Senator Hiram Monserrate was indicted for allegedly stabbing his girlfriend with a drinking glass last December. If convicted, Monserrate faces seven years in prison -- and, says one City Room commenter of today's developments, "will probably guarantee his re-election."

The State Senators (for convenience sake, let just refer to them "The Fare Hike Four" from now on) say they can satisfy the MTA's short-term financing needs with a four percent fare and toll hike and a small payroll tax increase. The MTA says that math doesn't work, according to Reuters:

The MTA's chairman, H. Dale Hemmerdinger, estimated the Senate plan would force the agency to raise fares and tolls by 17 percent -- about four times more than the Senate calculated -- as it would only raise about $1 billion more.

I suppose it comes down to a question of who do you trust more with the numbers, Richard Ravitch or four venal, old pols in the nation's most dysfunctional state legislature? If that's a tough call for you, then it's probably worth noting that Ravitch spent considerably more time working out his financing plan than did The Fare Hike Four. As Kathy Wylde at the Parternship for New York City says:

The State Senate has had almost a year to join the public discussion of funding for the transportation system. They waited until the very end of the process to come forward with a proposal that provides not a nickel for system maintenance and badly needed expansion of bus service, let alone a full capital program. It is time for both sides of the Senate -- Democrat and Republican -- to join the Governor and the Assembly in support of some version of the Ravitch Commission Plan.

Queens Senator Hiram Monserrate, who had considered new tolls on East and Harlem River bridges acceptable as a "last resort," has flip-flopped. The Daily Politics reports that Monserrate now opposes new tolls, and faults the MTA for "failing to explain 'specifically' how toll revenue would be used to pay for service and capital improvements." From a statement released today:

"Solving financial problems on the backs of hard-working New Yorkers now struggling with their own financial problems is the least desirable course of action," the senator stated.

"Tolling of the East River bridges should be considered only after passage of the 'Millionaire's Tax' that will ensure the wealthiest residents of New York pay their fair share."

"For these reasons, support of the so-called 'Ravitch Plan' is not in the best interests of New Yorkers."

Monserrate presides over a district where 53 percent of presumably hard-working households do not own cars and rely on transit, while less than five percent drive or carpool into Lower Manhattan for work. Still it looks as if his own windshield perspective has clouded his judgment enough that he would abandon the only viable plan in existence for a proposal that is positively Weiner-esque in its implausibility.

In other developments, Senate Majority Leader Malcolm Smith this morning laid his inability to unite the Democratic bloc at the feet of the MTA itself. Here is Smith, again from The Daily Politics:

"I know they have this deadline; I just don't think it's appropriate for the MTA to sort of hold the public hostage and say, 'Well if we don't get to the deadline we're going to charge you more.'"

"The public didn't cause their failures in terms of how they managed their budget," the senator continued. "It's the failure of their performance that has now asked the legislators to help."

"Yes, we can be there to help, but then we should have together have decided what the deadline was. Not them to impose their will on us and say 'because we screwed up, that we now are going to tell you if you don't help us we're now going to have a problem or cause a problem for the public.'"

While he did not declare tolls to be completely off the table, Smith says he is not counting votes because he has not seen a proposal -- including the Ravitch plan, apparently -- which "is worthy of having that kind of discussion."

Our plan rests on three powerful attributes: revenue generation, tolling equality, and sheer efficiency. We achieve these with an inclusive pricing model that asks drivers to pay a fee ranging from $2 to $10 upon entering the Central Business District with the price dependent on the time of day, and charges taxi passengers for their contribution to congestion as well.

The basics:

• Our toll plan generates $1.7 billion a year in revenue; that’s twice as much as the $800 million from Ravitch’s tolls, even though our top toll of $10 matches Ravitch’s $5 (we charge inbound only). As for Sheldon Silver’s $2 toll plan, it nets just $450 million.
• Our plan has no free riders; oops, make that free drivers. Jersey drivers pay the toll, drivers entering the CBD at 60th Street pay the toll, and Manhattanites pay the lion’s share of a 33 percent taxi fare surcharge that raises a quarter of our total revenue. Under the Ravitch and Silver plans, East River drivers who make only 36 percent of crossings into the CBD would be coughing up 60 percent of new toll revenues.
• Everyone wins something in our plan. Buses are free (paid for by $800 million of our $1.7 billion revenue pot). Straphangers get deep off-peak discounts (paid for by the rest -- though some of the reductions might need to be deferred to help stanch the MTA deficit) and a bit more elbow-room in rush hour due to peak-spreading. Drivers get a 20 percent traffic speed-up in the CBD (faster travel “upstream” too), while the variable toll offers a measure of choice.
• Free and faster-moving buses will achieve three goals. They’ll lure enough drivers and straphangers out of gridlocked streets and packed trains to ease crowding on both. By stopping drip-torture boarding that halts movement during Metrocard-swiping, they’ll traverse their routes fast enough to handle the influx. And they’ll provide a huge break to riders across the city, a disproportionate percentage of whom live in poorer, non-Manhattan neighborhoods.

Too good to be true? No, it’s real, the numbers have been checked and re-checked, the plan works.

Politically, who knows? It’s easy to shrug and say that if Albany can’t get it together to enact $2 tolls, there’s no chance for an ambitious plan like Kheel-Komanoff.

And yet … unlike the plans on the table, which impose tolls while giving little back (as did Mayor Bloomberg’s failed congestion pricing proposal), our plan is about gain, and freedom, and relief:

• Gain for the millions of transit riders who will enjoy better service and more spending money.
• Freedom from recurring fare hikes and service cuts.
• Significant relief from traffic congestion that frustrates drivers, dehumanizes our city and saps the economy.

Lately I’ve kept a low profile about our plan out of deference to Dick Ravitch and his well thought out plan that recognizes the gravity of the crisis. But Albany is so stuck, and the dialogue so stilted, that it seems time to air a bolder, more ambitious plan.

Since New Year’s, I’ve discussed the Kheel-Komanoff plan with dozens of electeds and advocates. The private response has been uniformly positive.

There may still be time to win a real hearing -- or at least infuse elements of our plan into Ravitch's. Let’s find each other now, before it’s too late.

General details:

• New tolls on East and Harlem River Bridges equaling "a single ride subway fare," ($2 each way.*)
  
• Management, possibly ownership, of East and Harlem River Bridges transferred to MTA from NYC DOT
• Maintenance and operation of East and Harlem River Bridges transferred to MTA from NYC DOT
• Truck tolls pro-rated on "single subway ride fare" or based on other MTA major crossings:$10 to $20.25 for 18-wheelers
  

• $450 million to MTA operating and capital budget
• $50-$100 million savings to NYC DOT in annual bridge maintenance and capital costs 

• Major reductions in truck traffic on Manhattan Bridge, where trucks now constitute 25 percent of vehicle traffic
• Major reductions  in overall traffic on Canal Street due to reductions in truck traffic
• Modest traffic reductions in Long Island City, Downtown Brooklyn, Northern Manhattan, South Bronx

Unknowns:

• Toll for taxis and for-hire vehicles
• Toll for government placard holders
• Toll for vans and smaller commercial vehicles
• Two direction tolls?* Tolls on the Midtown Tunnel and other "major MTA crossings" are two-way. We assume new bridge tolls will be applied in each direction, so a round trip car commuter will pay $4. 
• Exact status of management and operational control of East and Harlem River Bridges. To be determined by future agreement between MTA and NYC DOT: including bike/ped paths.
  

Of course, the State Senate has yet to offer up a plan of its own -- for what it's worth, the Senate has a new web site designed to gather public input on how to overcome the MTA budget shortfall -- and early indications are that some prominent Senate Dems are opposed to tolls altogether. We will know shortly if Malcolm Smith's pledge to consider tolls will result in the Senate passing Silver's modified Ravitch plan.

For more on East River tolls, traffic reductions and who pays, check out these 2003 reports from Charles Komanoff [PDF] and by Bruce Schaller for Transportation Alternatives and Straphangers Campaign [PDF].

Thank you for your email regarding the MTA. the Ravitch Commission has identified that that the MTA faces a combined capital budget and operating deficit shortfall of over $2 billion a year, to continue its construction program, eliminate service cutbacks, and mitigate fare hikes to the 8% range.

I support the proposed payroll tax and would certainly vote for a mix of taxes and fees related to vehicle ownership or use to raise the sums of money the MTA needs. I also agree that the Legislature needs to act as quickly as possible to address the problem.

It's not exactly getting out in front of the issue, but I suppose an indirect statement like this is the politically palatable way to say bridge tolls are a good idea. If you've received any constituent letters from your elected officials in Albany regarding their stance on funding transit, tell us about it in the comments.

We're hearing from advocates that the Ravitch Commission's package of recommendations is getting a warmer reception from state legislators than the congestion pricing proposal did last year, but there's still a lot of convincing to be done. One source in Albany tells us that the key to adopting Ravitch's MTA rescue plan, including bridge tolls, may lie with State Senate Majority Leader Malcolm Smith, and whether the Queens Democrat is willing and able to mobilize his conference in support of it.

Readers interested in helping out this weekend to drum up public support for the Ravitch plan are in luck. Transportation Alternatives is organizing six petition drives in Brooklyn and Queens starting at 11 a.m. on Saturday, and they're looking for a few good volunteers. Email wiley [at] transalt.org and specify where you'd like to pitch in: Astoria, Jackson Heights, Brooklyn Heights, Park Slope, Williamsburg or Bushwick. Also, keep an eye out in your neighborhood paper for T.A.'s local ad campaign (posted after the jump).

If you couldn't make it to the hearing today, the Campaign for New York's Future has an email action to voice support for a plan, like Ravitch's, that asks drivers and businesses to provide a stable funding stream for transit. An MTA rescue package that puts a price on free bridges would do far more to reduce traffic congestion than an alternative like Bill Thompson's proposal to raise vehicle registration fees, so I suggest a slight edit to the email script that will reach your state reps:

...riders cannot bear the brunt of this crisis alone -- we need contributions from all sectors, including businesses and drivers who currently commute via free bridges, because all sectors benefit when the trains and buses move millions of New Yorkers every day.

Tell us in the comments how you personalized your message.

Charles Komanoff in the booth at WNYC earlier this year. Photo: WNYC/Flickr

Today Ted Kheel released a revised version of his plan to fund transit through a congestion pricing mechanism on motor vehicle traffic. Streetsblog spoke to one of Kheel's lead analysts, Charles Komanoff, about the updated plan (see the major components here) and why he believes it offers a more comprehensive answer to New York City's transportation problems than the MTA rescue package unveiled by the Ravitch Commission last week. The interview has been edited for length and clarity.

Streetsblog: What are the major ways that the second version of the Kheel Plan differs from the original version?

Charles Komanoff: The major difference -- and it's kind of profound -- is the time of day and also weekend versus weekday pricing for both motor vehicles and the subways. A very cool result is that the average cordon fee under our plan would work out to be around $16, so we’re matching the number we had before, but we're doing it with a range from $5 to $25 that is geared to the amount of congestion that the trip causes. Which makes much more sense because the city gains a good deal more from eliminating a cordon car trip at eight in the morning on a Tuesday than from three in the morning on a Sunday.

A second difference is that we don’t have 100 percent free subways anymore but we have something that is in some ways better, which is peak pricing. This will spread the peak load in the subways so that 22 out of 24 hours of the day -- and all the hours on a weekend -- there will be more subway use than there is now. During the two peak hours -- 8 to 9 a.m. and 5 to 6 p.m. -- there will be considerably less subway use than there is now, which means not only do we address the concerns that people had previously -- “My goodness the subway is so crowded now at rush hour, you’re going to make it worse!” -- we’ve defused that argument because during those two worst hours there’s going to be less subway use than there is now. And I should make clear the six hours a day in which we're going to charge on weekdays are 7 to 10 in the morning and 4 to 7 [in the p.m. rush].

There is a third important change. The taxi surcharge is now 50 percent; previously it was 25 percent. Now remember that medallion taxis under our plan are not going to pay a cordon fee. You couldn’t do it because they’d be going back four or five times. I wish we could charge for Manhattan residents who have cars that are just going to be driving within the CBD and not breaking the cordon. We can’t get to that and that’s got to happen in the future, but at the very least we can charge a healthy surcharge for medallion taxis and that accomplishes three things. One, it generates almost $700 million and the system needs money. Second, it acts as somewhat of a break on what could otherwise be a big boom in taxi use as the streets get less congested... And third -- and this is where the politics come in -- who is going to pay the lion’s share of this taxi surcharge? It’s going to be Manhattanites, so we are really trying to balance the equities geographically.

SB: So the major planning and environmental groups who lined up behind congestion pricing are starting to push the Ravitch plan, and at the same time we have the same opposing forces lining up against bridge tolls. How are you going to sell this politically?

The prime underlying principle in the Kheel Plan is, I would say, "When New Yorkers use transit everybody wins, when New Yorkers drive everybody loses." And what we ought to be doing is maximizing the incentives for New Yorkers to use mass transit and we ought to be de-incentivizing or discouraging New Yorkers from driving.

The real arena is with Brooklyn and Queens, and with the populist -- or faux-populist, as Streetsblog would say -- forces. Why will they come in? Why they ought to support it is because it is geographically balanced, and it’s providing an incredible value to everyone in the city, especially the boroughs, in the form of free buses -- buses being much more of a borough than a Manhattan medium -- and providing nearly free subways, 75 percent discounted subways. The way that I would put is the way that I put it a year ago to Brooklyn and Queens, "How are you going to tell your constituents that you turned your back on a plan that could make mass transit virtually or practically free?"

SB: You do lose a bit of the pitch if you can’t say totally free subways.

CK: We do, so why are we doing that? We’re doing it for $600 million, that’s what we get by holding on to the fare box for those hours. The fare box now [collects] about $2,300 million and we hold onto $600 million. I don't think it's trying to make a silk purse out of a sow's ear. I think it’s an ironclad answer to the very legitimate concerns about subway crowding, and if we had free subways during those three morning and three evening most-crowded subway rush hours we might stress the system just beyond what anybody is willing to tolerate.

It's a much easier sell and it's a terrific argument -- the time of day pricing on both modes -- it really solves a lot of problems and creates a lot of benefits.

SB: Does this plan recommend bus service improvements and reaching those parts of Brooklyn and Queens that say, "We don’t have a transit option?" Is that part of this plan or is it implicit that that will be added?

CK: It's an input that needs to be added. There are some things that we don’t have quite the reach to do, but we think it’s really important to do that. I will point out that the existing bus fleet will experience a 20 percent boost in productivity from this plan because of the combination of reduced traffic and the fare-free boarding. So in that sense the existing bus fleet will run much more efficiently, and it will be a much more attractive form of service. That admittedly begs the question of adding the routes and we think it's vital to do that.

SB: What’s the cordon in your model?

CK: It's the same as we had a year ago, but the so called "offset" -- so that if a driver was already paying on a Hudson River crossing or the Queens Midtown Tunnel, the fee would be deducted -- we don’t have that. Whatever tolls there are now stay in effect, and our cordon toll is in addition. When I say that our toll averages out to around $16, that’s $16 in addition to what a driver may now be paying to drive into the cordon.

SB: So it would not equalize prices at cordon crossings across the board, you would have some variation in those prices?

CK: Yes, but what that means is that it would equalize the political impact, so the legislators from Brooklyn and Queens who were very irate about the virtually no-impact cordon toll on Jersey, we’ve defused that argument. Now there may be more cries from New Jersey, from the other side of the Hudson, but at least we’ve laid to rest this idea of geographic inequality that was a big problem with the mayor’s plan.

SB: The Ravitch plan, they anticipate, would generate $2.1 billion per year. How does Kheel Plan 2 compare to that?

The existing bus fleet will experience a 20 percent boost in productivity from this plan because of the combination of reduced traffic and the fare-free boarding.

The other is that we are not at all averse to having the MTA be able to tap some of Bill Thompson's weight-based registration surcharge. Clearly we don’t think that that’s an optimal answer to the whole MTA funding situation, because it’s very unlikely that something of the magnitude Thompson is talking about is going to pass, and the Thompson plan -- just like the Ravitch plan -- isn’t really going to do anything for traffic congestion. In fact it’s not going to do anything for subway congestion either but there’s nothing wrong with having that in a scaled down form. That seems like the kind of revenue source that really is most suited to reducing the state’s budget deficit. It’s not a transportation measure. It’s a revenue raising measure and fine, I would support it as a tax measure primarily for the State of New York, so let the state tap it and then let the state earmark a fraction of it for the MTA.

SB: We are hearing a lot about the stimulus package coming up and how much the federal government might be putting towards transit projects, but once this crisis passes do you think we'll be able to count on heavy spending on MTA capital projects from the feds?

CK: It seems to me that if we can solve the problem of the moment, which is the MTA deficit and the fare, and if we can do it in a way that is as revolutionary and as liberating as [the Kheel Plan], I think we will have done enough and the landscape of transportation and transit will be so different five years after a plan like this has gone into effect. I don’t think we need to fret now about what are we going to do in 2020. Not very many years from now it will be possible to charge VMT fees throughout the city and throughout the region, which will be a more comprehensive funding source, and ultimately the cordon fee ought to be superseded by a VMT fee-based system that will charge more to drive in congestion, or to create congestion, and less for driving that doesn’t. People are beginning actually to talk about that in the transportation policy community, and that would be the next generation, but we're not quite there yet.

SB: One way to look at the Ravitch plan is as an attempt to shore up the MTA's finances according to the principle that every constituency who benefits from the transit system should pay into it. What would you say is the parallel principle undergirding the Kheel Plan?

CK: I don’t think the Ravitch plan meets its own objective, most starkly in the continued exemption of any charge on drivers [from the Upper West Side and Upper East Side] coming in via 60th Street, which is just a stark omission, it's a giant exception. It's a real class issue. Who lives in those neighborhoods [that would avoid paying bridge tolls]? Relatively wealthy New Yorkers.

Why [Brooklyn and Queens] ought to support it is because it is geographically balanced, and it’s providing an incredible value to everyone in the city, especially the boroughs, in the form of free buses -- buses being much more of a borough than a Manhattan medium.

And there hasn’t been that much discussion of the payroll tax. It seems to [Kheel] and to me that it’s practically insane to be raising payroll taxes in the face of a severe recession. It’s discouraging employment and it’s taking money away from workers and companies, and there’s no way to mitigate that. Everybody is going to pay regardless of who they are and what they do. That may seem equitable, but it’s really very penalizing and it goes completely in the wrong direction.

Probably the prime underlying principle in the Kheel Plan is, I would say, "When New Yorkers use transit everybody wins, when New Yorkers drive everybody loses." And what we ought to be doing is maximizing the incentives for New Yorkers to use mass transit and we ought to be de-incentivizing or discouraging New Yorkers from driving. Transit users are already giving something up. They are giving up the autonomy of getting around in a car. To me and to Kheel the playing field has been badly skewed to benefit drivers, the paradox being, of course, that they no longer truly benefit because there are now so many of them that they've gotten in each other's way, as well as our way. The principle that comes first for us, and certainly for Ted, is to provide all reasonable incentives for people to not drive and to use transit, and that makes for a better city.

SB: There’s been repeated mention of the idea that fare payers should be expected to keep up with inflation and pay more into the system as costs rise. The Kheel Plan would go in the opposite direction…

CK: It’s a standard argument that has as an implicit assumption that the current situation is equitable. For us it comes back to the feeling that the transit users are sacrificing through giving up or foregoing the use of cars, so we’re not starting from an equal situation that otherwise should be preserved proportionally. It is a very disproportionate situation.

SB: Last week Ravitch said that a brisk timetable is necessary to head off some of the most severe austerity measures for the MTA. Before you were talking about Kheel Plan 2 being an issue in the 2009 elections. Have you advanced your timetable?

CK: Absolutely. We have advanced the political timetable because the moment of crisis and decision is here. But it could be that the [City] Council and [State] Legislature debate and reshape and vote on a modified Kheel Plan within the next several months, absolutely. I don’t see any reason that they wouldn’t be able to.

I spoke to Kheel Planner Charles Komanoff about the new version, why politicians in Brooklyn and Queens should embrace it, and how it stacks up against the Ravitch Plan. We'll post the interview later today. Follow the jump for the major points from Kheel Plan 2.

The promo flyer:

More from the press release:

Kheel's plan, devised by a team of transportation planners and economists that Kheel has funded for nearly two years, contains these key elements:

• A dramatic cut in subway fares (75%  on average), including a complete fare elimination on weekends and holidays, overnight and mid-day,
• A variable fare during the weekday peak periods that’s lower than the current fare;
• Complete fare elimination on all NYC Transit buses at all times;
• Congestion pricing on car and truck traffic into the Manhattan Central Business District (CBD), with tolls varying sharply by time of day and averaging $16 per trip;
• A 46% surcharge on medallion taxi fares (note that medallion taxis, and no other vehicles, would be exempt from the congestion pricing charge);
• 25% higher tolls on MTA bridges that don’t directly access the Manhattan CBD.

Using their comprehensive proprietary model of the city’s transit system and road network, Kheel’s team concluded that the plan would:

• Yield over $1 billion in net revenue -- sufficient to wipe out more than three-fourths of the MTA's projected FY-2009 deficit;
• Increase overall subway ridership by 12% even as use of the system shrinks by 6% in the morning peak hour (8-9 a.m.) and 10% in the evening peak hour (5-6 p.m.);
• Raise traffic speeds in the chronically gridlocked CBD by one-third during the day and one-quarter overall, while also boosting travel speeds throughout the City.

They're talking about Barack Obama, why car-pooling doesn't seem to work in New York City, and saving the MTA in three separate segments.

Too bad Weiner's not sticking around for the MTA piece to talk about his plan to raise the federal gas tax to pay for transit improvements. 

Photo: New York Times

• Bridge tolls would be cashless, using E-ZPass and license plate capture technology, not toll booths. The city would transfer ownership of East and Harlem River bridges to the MTA. Ravitch described this process as "very complicated" and said discussions were ongoing, but did not specify which legislative approvals would be required.
• The payroll tax, expected to generate $1.5 billion yearly, would be used to finance bonds for the MTA capital program. Ravitch described this as a lockbox structure that would keep farebox revenue separate from capital funding. (The underlying principle is that straphangers should pay for operating the system, not the capital program.) An exception would be made during the first year the tax is in effect, when it would be used to stave off deep service cuts and hold down the fare hike to eight percent, as opposed to the 23 percent hike that was unveiled last month. The state legislature will have to approve the tax.
• Bus service would be extended before the bridge tolls take effect. Ravitch endorsed BRT as a vital component of the rescue package, but did not give specifics about the number of lines to be added. He referred instead to the city's plan for pilot routes in every borough. "The more we're able to demonstrate to the public that this is a good thing, the better," he said.
  
• Expect action in the state legislature soon. "Time is critical because the MTA is required by law to adopt a balanced budget in December," Ravitch said. The fare increase process will start in January if the legislature does not act by then.

Paterson and Bloomberg gave the plan full endorsements, with the governor portraying its release as a day of reckoning. "The delays, the ways in which responsibility has been shirked if not just ignored in the past, to live for another day -- that day has come," he said.

City Room has a good run-down of the press event and some early reactions from advocacy groups and local pols. Looks like many of our electeds see the commuter tax and car registration fees as their preferred alternatives to bridge tolls.

Former MTA chief Richard Ravitch stood with Governor David Paterson and Mayor Michael Bloomberg this morning to discuss details of his commission's plan to keep the cash-starved MTA afloat both in the short-term and in years to come. Streetsblog's Ben Fried attended the news conference and will have more later. For now, here are a few highlights:

• The Ravitch plan would bring a "mobility tax" of 33 cents per $100 that would be levied on payrolls across the region, expected to raise $1.5 billion annually.
• As expected, the proposals include tolls on East River and Harlem River bridges, projected to bring in net revenues of $600 million per year.
• Ravitch described the plan, to be translated into legislation immediately by the governor's office, as "a major stimulus bill for New York State," which would generate up to $15 billion in wages.
• The plan recommends the MTA be allowed to impose fare increases not more than every two years, pegged at the rate of inflation, without public hearings. 
• Ravitch described his commission's work as "an effort to spread the burden among the largest group that one possibly can." 
• Governor Paterson expressed full support for the recommendations. Echoing Ravitch, Paterson described the proposals as "holistic." Said the governor: "The ways in which responsibility may have been shirked, or ignored, in the past, to live for another day -- that day has come, and we're going to have to make those tough choices."
• Oddly, perhaps, MTA head Lee Sander did not participate in the announcement.

Here's some of what was said in advance of the report's release.

From the Times, "Paterson Voices Support for M.T.A. Rescue Plan": 

The governor said he was still reviewing the plan, but was "quite pleased with what I see so far." "As an alternative to a fare hike,” he said, "I think it’s very viable."

The governor said at a news conference in Manhattan, "The message we keep trying to deliver is that we are in a very difficult fiscal time, and so it’s either going to be fare hikes or it’s going to be tolls and a combination of payroll taxes, but it’s the only way."

"Those who are upset about this, what I would urge them to consider is, it’s the inaction in the past that’s led to this overwhelming deficit," he said. "This is a very difficult endeavor, but we are trying to show leadership."

Assembly Speaker Sheldon Silver said that he had not seen the final report, but that he favored keeping the fare affordable. "I am not afraid of reasonable tax proposals that will provide the revenues that are necessary to do that," he said.

"Even the businesses that might be called upon to pay it would be better served by having that affordable revenue stream there, and an affordable fare," Mr. Silver said. "We can’t afford service cuts that make the subways and buses inaccessible."

Asked about tolls on the bridges, however, he reiterated that he was waiting to see the report.

Some of the difficulty that proponents will face in winning approval for the plan could be seen at a meeting of Democratic members of the Assembly in Brooklyn on Wednesday, some of whom voiced misgivings about both tolls and taxes.

"This proposal is the beginning, not the end, of a process, and there’s going to be a tremendous amount of deliberation before a final product is acted upon," said Assemblyman Hakeem Jeffries of Brooklyn. "We have to make sure that the outer boroughs don’t bear a disproportionate share of the pain."

From the Daily News, "Gov. David Paterson: Panel to suggest much smaller MTA fare hike":

The commission "found a way to reduce the fare increases to 8% by distributing the responsibility among all those who use the service," Paterson said.

From Newsday, "Panel touts 8% fare hike, city bridge tolls for MTA":

"I think the MTA had a certain number of options, and what the MTA had done was to raise fares by 23 percent," Paterson said yesterday at a news conference in Manhattan about judicial appointments. "What the Ravitch Commission . . . did is they came in and found a way to reduce the fare increases to 8 percent by distributing the responsibility among all those who use the service."

From the Post, "Gov: $ave MTA":

"Let's not make the bridge tolls be the center of the proposal," said Assemblyman Micah Kellner (D-Manhattan). "There's been widespread opposition to it for decades. I'd hate to see Ravitch make that the centerpiece of a proposal and watch it go down in flames because of it."

Kellner said that even though he's in favor of the toll proposal, the panel should focus on options that are more politically possible.

From AMNY, "Familiar fix for budget crunch — Raise fares and toll bridges":

"They’re coming up with the same old tired solutions that the public has rejected already," said City Councilman Tony Avella (D-Bayside). "We have too many bureaucrats who can’t think out of the box."

Another critic of fare hikes, state Sen. Bill Perkins, (D-Manhattan), suggested the MTA sell some of its real estate holdings to raise money.

"I want to see some creativity," he said. "I’m very concerned about that old idea that keeps coming back: Raise the fares."

Perkins, a member of the Transportation Committee, called the East and Harlem River tolls a "Quixotic" idea that’s "been around for a while and never gone anywhere."

Gene Russianoff, an attorney for the Straphangers Campaign who has been sharply critical of the MTA, said the Ravitch Commission appears to have struck a good balance.

"(It’s) asking everybody who benefits from the subways, buses and commuter lines to help contribute to their maintenance," he said. "That includes drivers, riders and businesses."

Mobilizing the Region has scooped up some interesting nuggets about the Ravitch Commission's soon-to-be-released report:

...insiders tell MTR that Ravitch is likely to recommend improved bus service, including increased investment in bus rapid transit and the establishment of a MTA Regional Bus Authority. The latter would take control of suburban bus systems like Long Island Bus and Westchester's Bee-Line Bus, potentially ending the annual battles over funding and resulting in substantial service improvements for bus riders. The former could offer near-term improvements in transit service for many outer borough residents out of the subway's reach...

Improved MTA oversight, transparency and strengthening of governance may also make the short list of recommendations, according to those who have seen the report.

When the commission held its first public hearing this September, there were still a lot of unsettled questions about its exact purpose. Several speakers asked Ravitch to extend the scope of his recommendations beyond how to fund the MTA -- to examine the agency's operations and identify reforms that can build its credibility. Looks like that testimony will be reflected in the final product.

Photo of Select Bus Service: Brad Aaron

Thompson is also advocating a new surcharge on vehicle registrations in 12 counties served by the authority, which he estimates would raise an additional $1 billion a year for transit. As explained by Thompson's chief economist Frank Braconi on WNYC's "The Brian Lehrer Show" this morning, the surcharge, like the existing state fee, would be based on vehicle weight, and would result in an average fee of $200. Currently, motorists pay $30 in city registration fees every two years.

Naturally, Braconi was peppered with questions from indignant motorists, one of whom asked why he should "subsidize" transit. Braconi's reply:

"There are many hidden subsidies of auto drivers ... But the truth is that mass transit [riders] subsidize auto drivers in many ways. For example, the fact that we can park free on our streets for the most part ... But the fact is we are all one city, and we all benefit from mass transit. Parking and driving would be virtually impossible in this city, it would be so congested, without a functioning mass transit system, and vice versa. I think mass transit users benefit that there are automobiles to deliver goods, and taxis, et cetera, et cetera ... [Drivers and transit users should] realize there is some fair way to distribute the costs of making the city work properly."

Fielding a call about motorists dodging the fee through registration fraud, Braconi said that residential parking permits are included in Thompson's proposal.

Elliot "Lee" Sander

"The budget presented today fulfills the MTA’s responsibility to put forward a balanced budget for the coming year,” said Elliot G. Sander, MTA Executive Director and Chief Executive Officer. "While we attempted to identify the least harmful cuts possible, they will be painful and no one at the MTA is eager to implement them. Even in a period of austerity, continued investment in the MTA’s critical operating and capital needs must be a top priority for elected officials in Albany, New York City and Washington. That is why Governor Paterson appointed the Ravitch Commission, and we will work hard to ensure that its recommendations are implemented to restore financial stability to the MTA. It powers our economy and we cannot allow the system to move backward at this critical moment."

"The proposed budget presents the MTA Board with extremely tough choices that we must grapple with over the next month," said Chairman H. Dale Hemmerdinger. "We have an obligation to pass a balanced budget, but we all hope that service cuts and extreme fare increases can be avoided. We will be closely watching the Ravitch Commission and will support its efforts in any way we can, both on the operating budget and also on the critical capital program, which cannot be forgotten."

Before any gap-closing measures are implemented or prior-year carryover is included, the MTA’s budget deficits are projected to reach $1.441 billion in 2009, $2.394 billion in 2010, $2.647 billion in 2011, and $2.972 billion in 2012.

Further details are to be worked out "in the coming months," but the plan calls for a 23 percent increase in toll and fare revenue, with regular alternate-year increases to begin in 2011.

Also on the table:

• Paratransit fares will increase to twice the regular base fare, "as allowable by law and consistent with other bus agencies"
• Express bus fares will increase from $5 to $7.50
• Long Island Bus fares will increase by 20 percent "over and above the general proposed fare increase in the absence of additional support from Nassau County"

At the same time, the MTA has proposed the following cuts in NYC Transit service.

• Route modifications – shorten G, operate N via Manhattan Bridge late nights, eliminate W and extend Q to Astoria, operate M to Broad rush hours, eliminate Z, add J local service.
• Increased headways and loading guidelines during non-rush hours – headways increase from 8 to 10 minutes on ADEFGJMNQR on Saturdays and the ADEFGNQR on Sundays; headways increase from 20 to 30 minutes from 2 a.m. to 5 a.m.
• Reduced station booth and station customer assistant staffing; elimination of enhanced station area track cleaning program.

• Reduce or eliminate low ridership services, especially during weekends or late night, and services that largely duplicate subway service. (Specifics have appeared in the News and Post.)

Commuter rail lines would be affected as well, with reductions in staffing, cleaning and maintenance.

Today's announcement is posted on the MTA web site, where the full budget is "soon" to appear. A final decision on the proposed budget will be made on December 17, after the much-anticipated Ravitch Commission report, and the state executive budget, are released.

City Room has more from this morning's MTA board meeting.

File photo: Brad Aaron

Streetsblog observed the afternoon session, which did not yield headline-grabbing ideas like the morning session (a media favorite: selling bridges to the MTA for a dollar and then tolling them) but did provide a good overview of which options the commission is likely to take seriously before making its recommendations in December.

It would be an exaggeration to say that a consensus emerged from the testimony. (The one thing everyone could agree on was that the collective well-being of the city and the region depends on the MTA.) However, several themes surfaced repeatedly over the course of the afternoon. Here's a brief rundown:

Responsibility for adequately funding the MTA should fall on those who benefit from its services. This encompasses a fairly broad swath of people, including straphangers, the real estate industry, and car commuters (who get less traffic on the street when more people use transit). Many of these "stakeholders" already contribute something to the MTA in the form of fares or dedicated taxes, and could be asked to pay higher rates going forward. Several people testified that some form of road pricing or bridge tolling would be an additional stream of revenue consistent with this philosophy.

The MTA needs more consistent and reliable revenue streams. Congestion pricing fits the bill in this regard, too. The need for predictable revenue also led speakers to suggest more broad-based taxes, unlike the targeted taxes mentioned above. (Taxes collected from the real estate industry have proven especially fickle recently.) Kevin Corbett of the Empire State Transportation Alliance recommended both road pricing and a payroll tax, saying that "if you have multiple parties sharing in the pain, it's easier to do a deal." He added, "Looking at the enormity of the task, we suspect it will be a combination of the various taxes [and] fees."

The city and state have been derelict in their contributions to the MTA, and debt financing has gone too far. These observations tended to go hand in hand. Pointing out that 13 percent of the MTA's expenses now go toward debt payments, rising to 16.5 percent in the next few years, Bill Henderson of the Permanent Citizens Advisory Committee to the MTA slammed the city and state for not holding up their end of the bargain. "We should not always have to make a periodic visit to the brink of disaster," he told the panel. "The question is not whether debt should ever be used, but what is the level of debt that can reasonably be used without imperiling the agency’s financial well-being."

It is reasonable, even desirable, to institute regular and predictable fare increases, but straphangers are currently shouldering too much of the burden. Henderson noted that, through the farebox, MTA riders fund 55 percent of the agency's operating costs, the highest share in the nation. (The figure is 44 percent in Chicago and 37 percent in Philadelphia, he said.) While several other participants echoed that number, the Kheel Plan would not have found a welcome reception among them. Corbett appeared to encapsulate the general sentiment when he called for "modest and regularly scheduled [fare increases], not more than once every other year."

The MTA must become more efficient and financially transparent. Many speakers praised the progress Lee Sander has made in streamlining the MTA, and just as many wanted to see further opportunities for efficiency identified. Two speakers, Gene Russianoff of the Straphangers Campaign and City Comptroller Bill Thompson, recommended creating an independent watchdog agency to monitor the MTA's finances. When Ravitch questioned whether another level of bureaucracy would prove effective, Russianoff implied that it may be a matter of political necessity. "The legislature will come to you and say, 'How will we know the money is well spent?'," he said. "You should have an answer."

Throughout the proceedings, Ravitch asked pointed questions but rarely betrayed his position on any single idea, giving the impression that he is genuinely open to all suggestions. The one question he posed again and again to those giving testimony was how to prioritize the potential solutions.

"How would you rank the various tax options available?" he asked Corbett. "Which would have the most deleterious effect on the economy, and which the least? No one likes any of them. The reason our task is difficult is that no one likes recommending charging anything to anybody. It's only when you compare it with the deterioration of the transportation system that you conclude you have to make nasty choices."