Home MTA EconomicsRavitch Commission State Senate Dems to support Ravitch recs

State Senate Dems to support Ravitch recs

by Benjamin Kabak

With the MTA’s financial future on the line, the Ravtich Recommendations are an important set of measures various state agencies can implement. While the city will eventually have to decide on the East River bridge toll centerpiece, the state senate seems to be doing its part to bail out the MTA.

As the Daily News reports today, State Senate Democrats are ready to support a new payroll tax as per the Ravitch Recommendations. The money from this one percent tax will help fill the MTA’s depleted coffers. Glenn Blain has more:

Senate Democrats are ready to support a new payroll tax to help rescue the MTA. Majority Leader Malcolm Smith, who previously opposed imposing new taxes, said Democrats would support the proposed tax if the business community agrees to it.

“It’s really the last thing we want to take a look at, however, this is a classic example, I think, of shared sacrifice,” Smith said Thursday.

The tax of one-third of 1% is a key component of the financial bailout plan crafted by former MTA Chairman Richard Ravitch. It would affect payrolls in New York City and the other counties the MTA serves. Smith noted that most business groups, including the Partnership for New York City, have expressed support for the tax. Ravitch’s plan, which has the support of Gov. Paterson, is intended to plug the MTA’s $1.2 billion budget gap and head off draconian fare hikes and service cuts.

According to Blain, Ravitch journeyed up to Albany to meet with State Senate leaders this week. Over the next month, in advance of the MTA’s March 25th drop-dead date, two State Senate committees will hold joint hearings on the Ravitch recommendations. Time is clearly of the essence.

Meanwhile, for MTA watchers, this development is clearly good news. If Albany passes half of the Ravitch-inspired bailout plan, the focus — and pressure — will shift to the city. Council members will face increased pressure to approve either the East River bridge tolls or some form of monetary relief — car licensing fees, congestion pricing — for the MTA. Our transit system might just be saved yet.

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Andy January 23, 2009 - 6:18 am

Well there will be no one left to ride the subways when all is sad and done – a host of new taxes in NYC, people are naive to think this wont affect business who will continue to leave NY. Understanding the mess the MTA is in is a problem, but it need ot be balanced by the utter financial mess NYC is in. Business taxes will come back to bite us all.

rhywun January 23, 2009 - 12:02 pm

That’s a little overdramatic. Here’s an equally overdramatic alternative: how are businesses going to be able to business if their employees can’t get to work?

Andy January 23, 2009 - 12:36 pm

Why can’t they get to work? There is infrastructure in place – imperfect as it may be -it’s there now. If you think higher payroll taxes wont have an effect on businesses than you have never run a business.

Alon Levy January 23, 2009 - 5:45 pm

If a 1/3% payroll tax is so disastrous, how come a 23% fare increase is not a problem?

Fritz January 26, 2009 - 12:58 am

Alon, I would assume because he believes in the mobility of business and their ability, likelihood of leaving the city. Conversely, he thinks that if businesses have lower taxes they won’t leave so even if individual laborers (those paying the 23% increased fares) have to leave they can be replaced by other mobile laborers. That’s my guess.

But, you do have to save the subway system and I hope they enact both the payroll tax and the bridge tolls.


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