Thomas DiNapoli, the New York State Comptroller, issued a brief report on the state of the MTA ridership levels yesterday. The report is written in a way to draw headlines. “Ridership declines cost MTA $100 million,” screams his press release, but behind the figures is another story about the MTA’s precarious economic position.
First, the news, as DiNapoli’s office put it:
State Comptroller Thomas P. DiNapoli today released a report [PDF] showing 75 million fewer customers used the Metropolitan Transportation Authority’s (MTA) system through October 2009 than during the same period in 2008, costing the MTA more than $100 million in lost fare and toll revenue. DiNapoli attributes the sharp decline to the 110,000 jobs lost in New York City between October 2008 and October 2009.
“The MTA is vital to the strength of the regional economy – and the health of the economy has a huge impact on ridership,” DiNapoli said. “People don’t commute when they’re unemployed.”
In 2008, more than 2.6 billion riders used the MTA’s buses, subways, and commuter railroads and about 300 million vehicles crossed the MTA’s bridges and tunnels. Subway ridership, which had grown by 242 million trips between 2000 and the peak year of 2008, accounted for the biggest decline in 2009, with about 44 million fewer riders from January 2009 through October 2009 than during the same period in 2008.
As far as the facts go, nothing DiNapoli says is wrong. As the MTA’s own internal indicators show subway ridership is down in 2009 over the same period in 2008. DiNapoli is right to blame job loss figures and the overall state of the economy as well. Those out of work are taking fewer rides into Manhattan’s central business district, and fewer people are taking extraneous subway trips.
His conclusion though — that the decline in ridership has cost the MTA over $100 million — isn’t quite right. It is certainly headline-grabbing. Nearly all of the articles about the report lead with that news. But that’s now how the MTA’s budget calculations work.
The MTA each year calculates ridership revenue based on their expected ridership figures. When the authority issued its 2009 budget at the end of 2008, it allowed for the economic downtown and projected lower ridership figures and lower farebox revenues. Through November, subway ridership totals were just 3.9 million passengers lower than projected while Bridge & Tunnel and bus ridership totals were higher than expected. In the end, the MTA hasn’t really lost revenue, but as with any business, in a better economy, the authority would draw in more money. That seems to be the more obvious point DiNapoli is trying to make. Charging the MTA with a $100 million loss when it wasn’t expecting that $100 million in the first place is a bit misleading.
DiNapoli’s report brings up an interesting quandary about the MTA and the city’s subway system. It’s clear that the subways are a part of everyone’s daily life, and the ridership and revenue totals hew closely to the state of the economy. To me — and to many urban policy experts — the subways are a public good then. The city exists on a large geographical scale with a highly concentrated business district in Manhattan because people can get from the Rockaways and Coney Island to the Bronx for a MetroCard swipe. The public good aspect of the subways are also why the fares are so low. For the subways to serve their purpose, fares must remain affordable and, in a sense, artificially low.
Yet, when it comes to funding, politicians prefer to treat the transportation network as a luxury good. It takes political arm-twisting and threats of “Doomsday budgets” to gain even modest concessions and half-hearted funding plans. The MTA is a creature of the state. It was established by the state to serve the public in a vital role, and the people in power refuse to recognize it.
DiNapoli’s report underscores why the MTA shouldn’t have to rely heavily on farebox recovery for its primary source of funding. When will the politicians realize this as well?