MTA Board Approves $17 Billion Budget Despite Concerns Over Looming Fare Increases
December 12 2018 - 5:31PM
Dow Jones News
By Paul Berger
The Metropolitan Transportation Authority board on Wednesday
approved its $17 billion budget for 2019, even though the authority
still needs about $400 million in fare increases and cost
reductions to balance its books.
Before the vote, board members discussed the mounting challenges
facing the nation's largest public transit agency next year as
commissioners weigh a fare and toll increase for March amid rising
commuter frustration and a looming budget crisis.
"We are standing on a precipice with our budget and with the
quality of the service we are providing," said board member Susan
Metzger, who represents Orange County, N.Y., during the meeting at
the MTA's headquarters in lower Manhattan.
The MTA's four-year financial plan forecasts a deficit of almost
$1 billion by 2022, unless the authority can cut costs or find new
sources of revenue. Because of declining subway and bus ridership,
officials lowered fare revenue forecasts through 2022 by $485
million.
The authority will only balance its budget next year if it finds
more than $100 million in as yet unidentified cost reductions and
if the board passes a fare and toll increase expected to net the
authority $270 million in 2019.
Those measures are on top of $400 million in already identified
cost-cutting moves that include reducing staffing for subway car
cleaning and bus fare evasion patrols. The authority recently
enforced a hiring freeze for all nonessential staff.
The MTA began a program of fare increases every two years in
2009 with the aim of keeping adjustments as small and predictable
as possible. The latest proposals include eliminating the 5% bonus
currently added to MetroCard purchases over $5.50 and raising the
cost of a 30-day MetroCard by 5% to $127.
Board members chafed at having to approve a budget that assumes
a 4% net increase in revenue from fares on subway, buses, commuter
rail and tolls at the authority's nine bridges and tunnels. Many
expressed unease about raising prices at a time of heightened rider
frustration with subway, bus and commuter rail service. New York
Gov. Andrew Cuomo and Mayor Bill de Blasio have also spoken against
a fare increase.
Board members are expected to vote on the proposed increase in
January, though some have suggested delaying the vote until the
state and city approve their own budgets during the first half of
next year. MTA officials have warned that every month of delay will
cost the authority $30 million.
Board member David Jones, who was appointed by Mayor Bill de
Blasio, said he wished MTA officials would say what cuts need to be
made if the increase isn't implemented in March so that riders
understand what is at stake. "There are consequences here not being
laid out to the public," he said.
Several board members suggested that the MTA needs to be
restructured. Lawrence Schwartz, an appointee of New York Gov.
Andrew Cuomo, told board members that he would push for reforms in
2019. "We are going to be a lot more aggressive and assertive and
proactive next year," he said.
(END) Dow Jones Newswires
December 12, 2018 17:16 ET (22:16 GMT)
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