“How does this make sense?” That is the question Assembly Member Jim Brennan, the chair of the Committee on Corporations, Authorities and Commissions, asked when faced with Gov. Andrew Cuomo’s smoke-and-mirrors approach to MTA funding during a recent hearing. His has hardly been the only incredulous voice throwing all levels of shade toward Cuomo’s proposal, and as we sit in Month 15 of a stand-off over funding for the MTA’s capital plans, planning for work to be performed under the current five-year program has slowed to a crawl.
The problem began back in October when Cuomo announced a funding agreement covering the MTA’s capital funding gap. Along with coercing the city to give $2.5 billion to the plan, Cuomo promised around $8 billion of additional state funding, but he was ambiguously vague about the source of the money. A noted motorist, Cuomo has never tried to use his political capital to push through any congestion pricing plan or Sam Schwartz’s tolling plan, and transit advocates and economists were concerned Cuomo would force the MTA to fund the capital plan through debt. The $8 billion, in other words, wasn’t really there at all, and the state would simply enable more MTA borrowing.
That is essentially what’s happened but worse. In his budget release [pdf], The state’s additional contributions beyond an initial grant of $1 billion would, as Cuomo noted, be available to the MTA only “after MTA capital resources planned for the capital program…have been exhausted,” and the state anticipated fulfilling its funding pledges for the 2015-2019 capital program by 2025-2026. For those keeping score at home, 2025 is supposed to be the launch year for the MTA’s second five-year program after the one currently under endless review.
With the measure also increasing the MTA’s debt ceiling to $55 billion for capital expenditures from 1992-2019, it’s clear that the governor wasn’t too interested in ponying up the billions in a way that would prevent future pressure on the MTA’s operating costs in the form of ever-increasing debt service obligations. Thus, his October promise was anything but a promise and simply consisted of debt, debt, and more debt. The capital program, meanwhile, still hasn’t been approved, and the MTA can’t spend money on needed projects yet.
No one watching the watchers is too happy about Cuomo’s proposal. Brennan pushed MTA CEO and Chairman Tom Prendergast a few weeks ago on sources for the money, but Prendergast’s lack of concrete answers pushed the legislators toward pointed criticism. “At some point,” Brennan said, “it would be nice to see a proposal from this person who’s the elected leader of the state.”
Senator Marty Golden was similar skeptical. “I have no idea how we can actually do a capital program and actually approve a capital program with language that it’ll be there when you need it. Corporate America would laugh at this. Any country would be surprised with this type of approach in funding.”
Advocates have written pleading op-eds urging the Governor to right this wrong, and the New York City Independent Budget Office has thrown up some serious red flags as well [pdf]. In a report released late last week, the IBO warned that both the city and state are likely to delay their actual contributions until the MTA exhausts its borrowing capabilities and then delays repayment until 2025-2026. This, in turn, could affect access to federal funding, delay budgetary considerations until after the next rounds of state and city elections and jeopardize actual contributions to the 2020-2024 plan, if not that plan in its entirety (which, by the way, is when I would expect to see the bulk of Phase 2 of the Second Ave. Subway receiving funding).
The state and city have continued to push back on this narrative by claiming their budgetary contributions are “iron clad,” but it’s hard to take Cuomo or Mayor Bill de Blasio as their words. They have hardly been transit boosters before, and the budgetary shenanigans are just another way to stick it to New York City’s transit riders without tackling the larger issues of mobility and capital funding. It’s the same old song and dance, and 15 months after the capital program was due to start, we are still no closer to a real solution.