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The New York Times

 

Is There Any Hope for New York City Transit?

October 07, 2013

By Nicole Gelinas

From a skim of the first page of last week’s report from the state comptroller, Thomas P. DiNapoli, a reader might think that all is well with the M.T.A. DiNapoli said that the transportation authority will have $1.9 billion more than it expected over the next four years. He even said the M.T.A. should consider "reducing the size of planned fare and toll increases." But the M.T.A. can’t think of cutting back fare hikes until it and the state make progress on two goals: cutting health care costs and securing money for capital investment.

As the comptroller points out, the M.T.A. will increase fares and tolls by more than twice the inflation rate over the next half-decade, following similar increases over the past half-decade.

But the M.T.A. is increasing fares so steeply because key costs are also increasing quickly. Health care costs for M.T.A. workers will rise nearly 42 percent over the same period, to nearly $2 billion annually. Annual debt costs will rise nearly 30 percent, to $2.9 billion. Pension costs have nearly leveled out, rising to $1.4 billion in 2017 from $1.3 billion this year. But they have quadrupled in a decade. Even with planned fare and toll hikes, the M.T.A. faces a $100 million annual deficit in four years.

The M.T.A. faces two big financial risks, too. The first is employee raises. As DiNapoli notes, "all of the M.T.A.’s labor agreements with its unionized employees have expired, some as long as four years ago." The M.T.A.’s agreement with the Transport Workers Union, its biggest labor force, ended nearly two years ago.

If the next mayor awards city unions, including the teachers union, retroactive raises, M.T.A. management will face pressure to do the same.

The M.T.A.’s other risk is its long-term investment budget. The authority must spend $26.6 billion before 2019 "just to fund core capital needs," says DiNapoli. This money goes not toward new projects like the second phase of the Second Avenue Subway, but toward maintaining and replacing aging assets.

And the M.T.A. still doesn’t know how badly Hurricane Sandy damaged the subway system. If parts wear out far faster than the M.T.A. expects, it may face higher costs long after federal money has run out.

If the M.T.A. doesn’t get state or federal grants to cover these investment costs, it will have to raise even more debt increasing deficits.

Governor Andrew M. Cuomo should direct the M.T.A. to use its current budgetary reprieve to achieve some fixes. The authority must get health care costs under control. Controlling these costs is a place where management and labor should agree, as some savings could go toward worker raises.

But the governor must take the lead himself on another issue: rationalizing toll revenue.

The governor should convince the state legislature to adopt some version of the Move NY plan, proposed by the former city traffic commissioner Sam Schwartz. The plan would charge truck and car drivers to come into congested parts of New York via currently free bridges, reducing traffic (and truck and car crashes). The money would go toward lowering tolls on expensive bridges like the Verrazano-Narrows from Staten Island to Brooklyn and toward long-term investments in transportation and transit.

Only after these reforms can New Yorkers expect fares and tolls that don’t exceed inflation. Absent such political bravery, straphangers can expect more of the same.

Original Source: http://www.nytimes.com/roomfordebate/2013/10/07/is-there-any-hope-for-new-york-city-transit/two-looming-risks-for-future-mta-budgets

 

 
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