Apr
27

MTA deficit increases by $621 million

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As Albany dallies, so grows the deficit.

In a presentation to the MTA Board’s Finance Committee this afternoon, agency CFO Gary Dellaverson said that the MTA deficit has grown by $621 million this year. Even if the State Senate Transportation Committee passed a “conversation starter” funding plan bill to target the earlier $1.2 billion deficit, the agency will still be hundreds of millions of dollars in the red.

I had the opportunity this morning to watch, via webcast, some of Dellaverson’s presentation. What was notable about it was how utterly open it was. Anyone could have watched it; anyone could have walked into the MTA HQ to attend; and Dellaverson held nothing back. He talked about methodology and numbers; he talked about why the MTA projections last year were off and what external forces are causing the deficit to grow in hundred-million-dollar leaps and bounds. How anyone could claim that the MTA needs more transparency in that regard just shows me that the people saying that — our elected officials allegedly representing us in Albany — are just not paying attention.

Anyone, I digress. The real news here is a whopping $1.8 billion budget for 2009 with more bad news for 2010. That year, the MTA says their budget deficit will increase by $1 billion over original projections. The Senate is going to have to institute bridge tolls sooner rather than later. It’s just reality at this point.

During Monday’s presentation, MTA officials pinpointed three sources of the decline:

  • Real estate taxes: Down $336 million
  • Fare/toll revenue: Down $221 million
  • State dedicated taxes: Down $113 million

There was simply no way to soften the impact of this news. “The budget that was passed in December assumed large decreases in revenue, but we now know that the reality is even worse,” Elliot G. Sander, MTA executive director and CEO, said. “With this re-forecast in hand we have begun identifying ways to fill the new gap, but there are no easy solutions.”

“Today’s re-forecast is further proof that the MTA desperately needs stable revenue sources that don’t plummet during economic downturns,” MTA Chair H. Dale Hemmerdinger said. “This is terrible news for the MTA, our customers and the regional economy, and the MTA Board will do everything in our power to protect the transit network. Without assistance from Albany, however, it will be extremely painful for everyone who relies on MTA services.”



Categories : Doomsday Budget

13 Responses to “MTA deficit increases by $621 million”

  1. Scott C says:

    This should be interesting. Nothing puts the fun in dysfunctional quite like the elected clowns in Albany.

  2. Marc E. says:

    I’m curious to know where the link to the webcast was. As someone who is very intimate with the system, you may take knowing where to find this stuff for granted. I certainly don’t see it on the MTA’s main page. It’s not transparency if no one can find the information in the first place.

    Don’t get me wrong, I completely agree with your sentiments…though I often run into this problem in arguing with people about the MTA and transparency…where do they find this stuff? Further, it’s one thing to just have the information all there, but it’s another if the information is made easy to consume. New Yorkers who feel betrayed by the MTA see the long budgets and the raw data as a way to mask inherent corruption. What the MTA needs is a better media department to interface with its riders better. whitehouse.gov and recovery.gov are excellent examples of good attempts at transparency. The rarely updated MTA.info and the financial documents made available there, in their current form, are not…

    • Fair enough, Marc. You’re right that I take this stuff for granted. Here are the various paths you could take. I believe the MTA could make its website better overall, but for what it is, it’s not awful.

      From the home page, click on the MTA Newsroom link and then on the live webcasts link. You can watch the board meetings as they happen or archived two or three days later.

      Unfortunately, while the MTA does tell people this stuff, they don’t update the documents online in any sort of timely fashion or organized way.

  3. Alfred Beech says:

    What are the ramifications?
    I assume that the doomsday fare increase/service reductions were targeted at balancing the 2009 budget based on December’s numbers. Do the missed estimates mean that the board will have to revisit fare increases again in 2009, or are they allowed to run a deficit until 2010, and then look at solutions again (assuming Albany doesn’t find additional funding)?

  4. Ray says:

    Congrats to Dellaverson who always seems to deliver the TRUTH. At this point, we should start calling the agency structurally bankrupt. They’ll now need to raise revenues but must DEMAND tools for dealing with labor, pension, bloated HQ, deferred maintenance, debt and capital quagmire. Lots to do.

    Still, this quote stood out in the comments above. “Unfortunately, while the MTA does tell people this stuff, they don’t update the documents online in any sort of timely fashion or organized way.” Yep.

    Great concession and it highlights an embarrassing truth. With 259 professional staffers in marketing and public relations the MTA website should have the look and feel (and traffic) of MSNBC.com (Staff size per NY Post, Nov 2008 per MTA spokesman Aaron Donovan.) Perhaps its time to rethink the business model.

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