Messes Mayor Can't Ignore
GOV. Spitzer last week said he was eager to move ahead on Mayor Bloomberg's plan to charge drivers to enter parts of Manhattan during peak traffic hours. But Bloomberg wants the fees to go to mass transit via a new joint city-state authority - and Spitzer's reportedly not so keen on that. He'd rather use those funds to patch the looming billion-dollar deficits at the state-controlled Metropolitan Transportation Authority.
Spitzer's stance should be a reminder to the mayor: It's hard to improve mass transit without fixing the MTA.
Bloomberg's congestion-pricing plan makes some sense. Manhattan's roads are a scarce resource, and the only two ways to allocate scarce assets are 1) waiting and 2) pricing. Right now, we do waiting - in the form of gridlock traffic. Despite some problems in the details - e.g., fears that Manhattanites will be plagued by even more noisy nighttime truck traffic as drivers dodge daytime tolls - the mayor makes a reasonable argument that it's time to try pricing instead.
The fees would mean a windfall for the city of at least $400 million a year. Bloomberg wants the money to go for things like getting subway assets into a "state of good repair," and for investment in technology to run trains on tighter schedules.
But there's a catch: While the MTA would carry out these projects, the mayor hopes the city can have some control. He wants to start a city-state public authority to control the new money gusher, to ensure that the MTA doesn't waste it. To prevent the MTA from using the cash for day-to-day costs, he wants the new authority to transfer funds to the MTA only for worthy projects and only if it thinks the MTA can complete the projects efficiently.
And to do all this, the mayor needs the approval of Spitzer, Assembly Speaker Sheldon Silver and Senate Majority Leader Joe Bruno.
That's where political and fiscal reality intrudes.
Last Monday, the city's Independent Budget Office reminded us that the MTA will soon face massive deficits in its budget for day-to-day operations. The shortfall deficit could reach $800 million next year, or nearly 8 percent of projected spending for operations; the year after, it balloons to nearly $1.5 billion; by 2010, it hits nearly $2 billion, or a whopping 16 percent of the operating budget.
Why the deficits? In part, they're just business as usual, delayed: The MTA has collected record real-estate-related taxes during the city's property boom of the last few years. But instead of using the time that money gave it to cut costs, it pushed its problems to future years. Under Gov. George Pataki, the MTA refinanced billions in debt and made sure the pain wouldn't come until he was out of office.
So now the MTA has to find more money or cut spending or both. But cutting spending means forcing the Transport Workers Union to improve productivity and modernize pension and health benefits so that they're comparable to what's on offer in the private sector. The MTA can't do that without unified support on the part of city and state politicians, and it can't do it before 2009, when the current union contract expires, anyway. (MTA management could stand some cuts, too - as the state comptroller reported a couple of years ago, the authority's front offices are also bloated.)
It's far likelier that the MTA will move to hike fares and tolls. Subway and commuter-rail riders would see prices jump as much as 40 percent, depending on whether the state and city also increase their MTA subsidies. The cost of a single subway ride could hit $3.
Economically, there's nothing wrong with hiking fares; from milk to movie tickets, all costs go up. In fact, the MTA should index its fares automatically to inflation, rather than delay until it has no choice.
But, politically, governors hate it; Spitzer said just a few months ago he'd do "everything possible" to avoid a hike. Silver won't like the idea much, either.
That political hurdle suggests Bloomberg's plan might get hijacked. With those operating deficits coming down the track, will Silver and Spitzer really agree to allow Bloomberg's new public authority to control $400 million a year in revenues?
It's far likelier that Albany will support congestion pricing for the very reason Bloomberg didn't intend. The governor's MTA will covet that money to cover its costs so that it - and the governor, who gets the flak for fare hikes - can keep any such hike to a minimum.
Last Wednesday, Bloomberg suggested that his plan would indirectly help the MTA with its operating costs, anyway, by investing in new projects and encouraging more riders - but such thinking isn't likely to convince Albany.
The mayor may soon learn that while his plan to do an end run around the MTA's storied dysfunction was creative, the MTA is simply too big, and too dysfunctional, to ignore.
Original Source: http://www.nypost.com/seven/06112007/postopinion/opedcolumnists/mike_vs__the_mta_opedcolumnists_nicole_gelinas.htm