Home MTA Economics Cuomo removes $100M in dedicated transit dollars

Cuomo removes $100M in dedicated transit dollars

by Benjamin Kabak

Click the image to see Gov. Cuomo's proposed budget.

Gov. Andrew Cuomo has, as feared, removed $100 million in dedicated funding from the MTA’s budget as part of his effort to close a state spending gap that reaches the billions. For the authority, this is the second year in a row that the state’s chief executive has striped money intended for downstate transit, and while the MTA says it will not raise fares this year, history is not on the agency’s side.

Basically, the net losses to the MTA will be $100 million overall but such a relatively slim cut was accomplished only through an accounting sleight-of-hand. Essentially, Cuomo is removing $200 million in dedicated operating funds and granted the MTA’s capital fund — with its $10 billion gap — a meager $100 million in economic development money. The loss to the operating side far outpaces the $143 million Gov. David Paterson removed from the budget in late 2009.

John Petro from the Drum Major Institute has some analysis. Despite the potential for another $194 million infusion in capital funding only, Petro warns of the looming spectre of future service cuts if operating dollars aren’t restored. He writes:

Essentially, Cuomo’s budget transfers money from the operating to the capital budget. Of the $200 million being cut from the operating budget, $165 million will be used to pay down the state’s past borrowing on transportation bonds. The remaining $35 million will go to the state’s general fund.

While it is essential that the governor and legislature find ways to fully fund the MTA’s capital program, which has a nearly $10 billion hole, taking critical funds used to maintain good service is not appropriate. Nor is $100 million, or even $294 million if the Bond Act funds are included, enough to begin plugging the capital budget hole.

The governor has repeatedly insisted that he would not raise taxes or implement new taxes. But without a new source of revenue for the capital program, there will be more pressure placed on the MTA’s operating budget. The MTA can trim its costs only so much before more service cuts or fare hikes are on the way. Some of these service cuts will only be slightly perceptible—dirtier train cars and stations, abandoned bus runs. If this trend of cutting operating funds continues, more severe service cuts will need to be considered.

In its own statement, the MTA pledged to avoid service cuts or fare hikes. The authority had said the same thing a few years ago, but in mid-2010, it was forced to axe two subway lines and countless bus routes. Here’s their statement:

We understand that the State’s fiscal crisis requires sacrifice from every area funded by the State, including the MTA. Because the MTA has already taken unprecedented measures to reduce costs, finding an additional $100 million in 2011 will be very painful, especially with sizable deficits still projected for 2012 and 2014. As we continue cost-cutting, further reductions become harder and harder to achieve.

But we must fill this gap, and we will fill it without resorting to fare and toll increases or service cuts, because our riders have already been hit with these painful measures over the past year. Instead, we will work to find additional cost-savings through efficiencies and improved productivity throughout our company. We are hopeful that this year we can work with our labor unions to find productivity improvements that protect jobs even as we reduce costs.

Making these cuts will be painful, but we can only spend as much money as we have. Given the financial pressures facing the State, local governments, and every New Yorker, our only choice is to manage the MTA so that every dollar counts.

The Straphangers Campaign, meanwhile, applauded the MTA for avoiding service cuts and fare hikes — or at least promising to — and urged the state to use dedicated transit money only for transit. “In the view of the Straphangers Campaign and many other groups, those funds should be used to meet transit needs. However, the MTA says it will not have to turn to service cuts or fare increases to make up the shortfall. That’s very welcome after an unprecedented three years in a row of higher fares – as well as last year’s service cuts, the worst in memory,” Gene Russianoff said in a statement. “The MTA says that it will have to take ‘painful’ actions. The Straphangers Campaign and other groups will monitor the agency’s response closely to see that the transit system has adequate resources to provide safe, reliable, well-maintained, secure and clean service.”

Transportation Alternatives was even more direct in its statement. “Governor Cuomo campaigned on restoring honesty and ethics to Albany, but when it comes to transit nothing much has changed,” Paul Steely White, the group’s executive director, said.. “Cuomo is taking dedicated funds away from the riders.”

It’s hard to take this as anything other than bad news. It’s not a surprise, and every agency in the state is suffering under Cuomo’s budget. But the MTA has had it bad lately, and if stations get even dirtier and personnel begin to disappear from those stations again, we’ll know why. This is Albany’s doing through and through, and now it’s up to the MTA to minimize the impact of these cuts.

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Anon February 1, 2011 - 9:07 pm

Justin Samuels February 1, 2011 - 9:18 pm

They are putting in subtle service cuts. Today I saw a sign that basically said from now on, the M train service to Forest Hills ends at 11:00pm, instead of 12 am. This is a service cut, and I think there will be many such service cuts occuring. On certain lines, instead of trains running at every 20 minutes they may run at every 30 or 40 minutes.

Justin Samuels February 1, 2011 - 10:06 pm

Correction: I just found out the signs for the service for the M ending earlier are temporary and because of the bad weather………..

pea-jay February 2, 2011 - 5:58 am

Is Cuomo banking on the MTA putting the screws on labor costs on the operational side? I mean key contracts are up this year and is it possible that some of this cut could be absorbed via a salary reduction amongst the rank and file? Maybe a 5-10% salary reduction or staffing rule change that allows fewer employees to do the same thing?

Overhead two bus drivers complaining that Cuomo was “no good” for labor unions…

Marc Shepherd February 2, 2011 - 8:17 am

Ben, why do you keep saying “countless bus routes” were axed? It is not countless. It is an easily countable number. People who come to this site who are not transit junkies won’t know if you’re talking about tens or hundreds (it’s tens).

John February 2, 2011 - 9:13 am

I was wondering that too. There’s a definite number of bus routes that were axed, and it’s not that hard to find the number (I don’t think).

Streetsblog New York City » Today’s Headlines February 2, 2011 - 9:01 am

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Chris February 2, 2011 - 9:28 am

This is a pretty moderate cut compared to those experienced in other areas. It’s clear that Cuomo expects the MTA to join him in taking a hard line on union concessions in 2011. As well, this is 100% reflective of what Cuomo campaigned on in the election in which he was overwhelmingly selected. It’s hard to argue that this is not what people want.

Francis Menton February 2, 2011 - 2:22 pm

As long as the MTA has full retirement at age 55, overtime spiking in the last years of work, and extensive featherbedding (e.g., no split shifts, no part time, two operators on every train) there is no amount of funding that the state could afford that will be able to maintain the service. If we care about the service, just pleading for more money won’t work. The money gets diverted to pay the retired people playing golf in Florida and the service keeps getting cut. Advocates for the service need also to advocate for union realism.

nycpat February 2, 2011 - 4:28 pm

The MTA’s seperate agencies have different plans. Full retirement at NYCT is 50% after 25 years service if you are older than 55. Are NYCT’s labor expenses inordinate? What pecentage of any enterprise’s expenses is payroll?
I’d like to see split shifts on the subway and then be ordered to work overtime. What the hell, it’s only 18-20 hours out of someones day. Oh i guess you want part timers. Maybe they could shape up at 3:30am to see if there is any work available, if not come back at 3:30pm. So long middle class it was a great ride.
I see Wilkiefarr + gallagher is part of the race to the bottom. Was the time spent writing your post billable?

al February 3, 2011 - 1:51 am

You can rejigger the shifts to have more personnel for rush hr and fewer for off peak. It has been mentioned that train operators could spend more time at the controls like other union friendly systems around the world.

Cramming in overtime prior to retirement needs to go (union, white collar, blue collar, managers, executives, technical, etc). It distorts the pension, and thus inflates operating budgets that we all pay for through fares or taxes.

I remember there was a program for part time (20 hr/week) motormen for college students (4yrs). I know plenty of rail fans who would love to work as part time motormen or conductor for 4 yrs. There are many people who could use part time work due to family responsibilities.

MTA should do more thinking outside the box. The BusTime pilot is a good example. Open source development, and commercial off the shelf equipment (COTS) adapted for mass transit use. It could use a higher refresh frequency for higher positional resolution, but it is a good start. Perhaps we could install high resolution cameras, connected to COTS hardened computers/laptops, with photo recognition software, and tracking software at stations, and slow curves/switches. They could prick out the train’s routing via the train signs, and use car numbers to recognize the individual train. The fiber-optic backbone is already in place for network connectivity. Another is a RFID based system where each train car has a chip installed so that wayside readers can “see” it. Think contactless payment but more powerful.

jj February 2, 2011 - 3:55 pm

3 weeks in office and Andrew Cuomo is swinging the budget axe like Babe Ruth and Ted Williams combined

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[…] away! At least the subway inspires mirth in some fashion — Governor Cuomo this week announced a decision to cut $100 million in transit dollars in efforts to balance the State’s budget, which looks grim for the MTA’s promise to […]


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