In 2003, the MTA was no better off in the eyes of the public than it is now. That year, the agency was accused of cooking up two sets of books in order to justify a fare hike. One set showed the agency operating a deficit; the other showed a historic surplus.
At the time, Alan Hevesi unleashed a scathing report about the MTA’s behavior, and the agency was judged permanently guilty in the eyes of public opinion. It would be a watershed moment in the history of government — or quasi-government — agency corruption.
Fast forward to 2009. None of the MTA officials or board members responsible for the “two sets of books” scandal is still in power. Instead, the MTA Board is headed up by people with bona fide transit credentials, and the agency has attempted to be more transparent. Still, after years of governmental neglect, the MTA’s finances are in legitimate disarray, and if to close what may be nearly a $2 billion budget gap, the MTA will have to implement a Doomsday budget on March 25 if the state doesn’t act.
For its part, the State Senate can’t get over a scandal six years in the past. Glenn Blain and Pete Donohue tell of state Democrats questioning the MTA’s credibility:
Majority Leader Malcolm Smith (D-Queens) said the Metropolitan Transportation Authority “does not have a history of being forthright in terms of their budget. You know, they kept two books at a time.”
Senate Dems planned a “full vetting of MTA finances” and want to strengthen the state controller’s oversight of the authority, Smith said in a statement last night. Senate action on any bailout plan wouldn’t happen this week, a Smith spokesman said.
The “two sets of books” phrase was popularized in a legal challenge of MTA fare hikes in 2003. A suit based on reports by the state and city controllers claimed the MTA misled the public by exaggerating its financial situation. Two trial judges agreed, but an appeals panel overruled them. It unanimously declared “the record does not support the lower court rulings that the 2003 and 2004 deficit was ‘fictional.'”
Smith, it seems, is willing to penalize the MTA — and by extension, all New Yorkers — for a story that broke six years ago and was resolved by the state courts half a decade ago. At what point does this fishing expedition become simply that? Smith doesn’t want to confront the hard truth of Senate inaction and would rather pawn off these problems on the good old public scapegoat version of the MTA.
Ignore the fact that 22 of 62 State Senators weren’t even in the legislative body when this scandal broke. Ignore the fact that we should vote out any who don’t support the MTA. Just think about that time when bad MTA leaders cooked the books. Clearly, the only logical result is another audit, and by golly, that’s just what the Senate Dems are getting three weeks before doomsday.
Elliot Sander, the current MTA head who actually knows what he’s doing, had the best response to the Albany inanities: “The time for excuses is over. Albany needs to act.” Hear, hear.
19 comments
If you think the MTA doesn’t still have two sets of books you are naive and most likely new to New York so I guess… welcome to our city. Everything here is run by political machines / the mafia and that is a fact. This is the same reason why “Ground Zero” is still a mud pit. There is no possible way that a transit system that hasn’t increased in size in almost 70 years yet has had a dramatic increase in ridership and fares can be losing money.
The subways used to exist as a private companies, one of the three was still showing a profit when the MTA took control of it… during the great depression and all of a sudden a system that literally millions of people depend on and pay money into needs to start taking in money from bridge tolls and fair hikes? The answer here is that some wiseguy is living in a nice mansion in Queens thanks to all of us suckers.
Now you want Albany to act fast. This, as all real New Yorkers know, is a huge joke. They lack the capability to do so steeped in their own tradition of corruption. Upstate legislators killed congestion pricing, which was a good idea, and all of a sudden you want these same people coming in to save us? Give me a break.
Furthermore, why should we move past the “cooked books scandal.” No one got in trouble for it, its par for the course in NY government/agencies and there better not be one WHIFF of ANY WASTE if they want to raise fairs again AND bring in tolls to non MTA bridges. Damn straight they need to be completely vetted through and through, unfortunately Albany needs it too.
All these crooks should be in jail.
I appreciate your taking the time to comment, Michael, but the tone of your comment is just flat-out nasty from the first line to the last. I don’t need to defend myself from point blank attacks, and I’ve lived in New York City my entire life. Have you?
That said, you are welcome to accuse me of naivete, but if you believe the State Senate is not engaged in some good old fashioned delay politics here, I wonder who’s naive. You can accuse the MTA of cooking the books, but the numbers this year have been subject to fairly robust scrutiny with comptrollers at the state and city level noting that action is necessary to stave off this Doomsday budget.
Feel free to support inaction. When nothing is passed and you’re suffering from bad service, I’ll just say, “I told you so.”
The MTA should probably be audited, but 20 days before they have to enact at Doomsday budget when the State Senate has known about it for four months is point blank ridiculous.
Do you think its possible that if the MTA were to continue to fail so epicly that the gov’t could seize the agency’s assets and issue bids to private companies to buy up the system? Seems like NYC transit is a goldmine that any efficient private company would have interest in not only being able to turn a profit, but use these profits to increase the system and ultimately make a bigger profit
Public transit is never a gold mine. Fares cover less than 50% of the operating budget and advertisement is not going to make up the rest. Have you ever ridden on an empty train at night or in the outer stretches of the system? There would be no trains at that time and at that location if the MTA were run for profitability.
The 2 sets of books scandal should NEVER be forgotten!!! The MTA used the FAKE set of books to get concessions and give a lesser contract to it’s work force and when caught with the REAL set of books showing a HUGE surplus they didn’t reopen the contract. That’s money that the hard working blue collar employees lost for the length of there careers and “bread out of there childres mouths”!
If a massive public Authority such as the MTA isn’t being audited on a regular basis, something’s rotten in Albany…. Remember, Authorities are set up specifically to escape certain responsibilities & risks that ordinary companies are subject to. That’s how they got away with cooking their books in the first place.
You’re right they should be audited MORE than any public companies.
[…] « Albany trying to exploit a six-year-old scandal Mar […]
Only THEN will decimated real estate transfer tax revenues not require service cuts, fare hikes, and/or more reliable sources of revenue!
Many of these posts ignore one crucial fact: the subway is public property, and the MTA is a creature of the state. Yelling at the MTA is like walking into your own home and saying, “Who made this mess?” It is your house, and whatever mess it’s in is your own fault.
The MTA, which the legislature created, is saying that it will need to raise fares and cut service in order to balance its budget—a requirement also created by the legislature. The legislature, if it wanted, could fire every last one of them and run the subway itself. It could make Shelly Silver an L Train motorman if it wanted.
So all the levers necessary to fix the subway are entirely within the legislature’s control. Right now, the guys they hired to run it are saying they are out of money. Complaining about the guys who ran it in the past, and are no longer there, is just stupidity. It’s like saying your house is a mess because the housekeeper you had six years ago did a poor job.
The reason the MTA exsists is so that the polititians don’t have to be held responsible at times like this.
You say the subway is public property but it is NOT a city OR state agency running it. It is a gray area rogue agency that reports to only one person the governor and at the moment he is horribly illequiped to handle the job that he was forced into.
A “rogue agency”? Please. I think you’re reading too many conspiracy theory tracts. There are many, many problems with the MTA, and I wouldn’t be surprised to see it disappear in a few years. But it’s not a rogue agency.
For those of us that have intimate knowledge of the TA along with what is reported by the media KNOW that the MTA is a rogue agency.
When they got caught with the 2 sets of books how many people went to jail for that FELONY offense? ZERO!!!!
Even if you think it is a rogue agency, it exists only because state law permits it to exist. If it is under the governor’s control, that is only because the law gave the governor that power. If you are unhappy, the people you should be complaining about are your state legislators. It is they (or their predecessors) who created the MTA, and it is they who permit it to be run the way it is run. If they take no action, then they will continue to get the same results.
[…] To The MTA, Long Live The MTA In 2003, the MTA was no better off in the eyes of the public than it is now. That year, the agency was accused of cooking up two sets of books in order to justify a fare hike. […]
[…] “we must get away from this notion that the MTA keeps two sets of books.” Why? Because it’s just not true. It was an accusation made of the MTA by Alan Hevesi six years ago – a charge that was resolved in […]
[…] “we must get away from this notion that the MTA keeps two sets of books.” Why? Because it’s just not true. It was an accusation made of the MTA by Alan Hevesi six years ago – a charge that was resolved […]
[…] “we must get away from this notion that the MTA keeps two sets of books.” Why? Because it’s just not true. It was an accusation made of the MTA by Alan Hevesi six years ago – a charge that was resolved […]
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