Veronica Vanterpool, associate director, Tri-State Transportation Campaign
Testimony at MTA Board Meeting
July 27, 2011
Today the MTA will outline how it plans to close a $9 billion budget gap in its construction program, the program pays for crucial investments like track work, station rehabs, and new subways and buses.
The agency’s financing plan, from what we understand, is based on a similar, unsustainable practice—taking out more debt. The grand plan on the table is to borrow up to $7 billion. We are still paying off debt from 11 years ago. Is this the transit legacy we want to leave behind?
This financial plan is incredibly precarious. It relies on one-shots from the Port Authority and the federal government. It assumes changes in labor agreements. It relies on an increase in support from New York City. It relies on an increase in the agency’s debt cap by the State, and approval by the State Legislature of new bonds. These are indeed possibilities but the variables and politics associated with each make them far from a sure bet.
The program will pay for needed investments that we support: station rehabs, signal modernization, track work, lighting, customer assistance. But, the Tri-State Transportation Campaign cannot support saddling future generations with debt, especially because the outlook for the system is grim. Imagine how difficult it will be to win support for transit in 5 years for the capital program when the public will be paying billions for a system slowing on the decline.
We recognize a lot of the problem is out of the MTA’s control. City aid to the agency has remained stagnant since 1995. The state used $250M in dedicated transit funds for other non-transit uses. New revenue, such as the payroll tax, has either come up short or been held hostage by suburban counties upset with the tax. And, the MTA can only implement but so many cost efficiencies before public safety, system cleanliness, and service delivery are compromised. We believe the agency is working hard to reduce costs, and applaud it for cutting $4 billion from this program.
There is no coincidence that the vibrancy of New York City today exists because of the investments we’ve made since the MTA’s first multi-year rebuilding program was created in 1982. The last capital program, fully funded, would generate 20,000 new jobs over thenext 9 years and generate nearly $37 billion in economic activity. It accounts for 25% of NYC’s construction jobs. It allows business to flourish and grow throughout the region and protects property values. Despite this, suburban legislators are pushing for the repeal of key funding sources for the system.
Straphangers, don’t be fooled just because service isn’t being cut this year. The MTA is in a bad financial situation. Money that should be going to improve your commute is going to pay off debt instead. Fare increases are being planned every two years from 2013 on. Where does that leave NYC and the riding public? Governor Cuomo and the state legislature, we’d like to know.