Since the Port Authority announced its new budget on Friday, the New York City transportation scene has been a-flutter with interesting takes on the situation. Yesterday, we discussed how the new toll and fare structure could usher in a congestion pricing scheme that would generate more revenue for transportation and transit while reducing the traffic that currently chokes Manhattan. Today, I want to pick up a different thread involving the lessons New Yorkers should take from the Port Authority’s situation.
While the MTA and the Port Authority are intertwined, the two agencies operate off of a set of very different assumptions. The Port Authority is entirely self-sustaining. It relies on the revenue from PATH fares and bridge and tunnel tolls — mostly those bridge and tunnel tolls — to fund its capital and operating budget. The MTA, on the other hand, does not. While MTA Bridge and Tunnel revenues have long been used to subsidize bus and subway operations, they don’t come close to covering the operating and capital costs associated with running the MTA.
At Transportation Nation last night, Andrea Bernstein wrote an encompassing look at the fare proposal, and she discussed the differences between the PA and the MTA and how they impact each other. She writes:
Unlike, say the NY MTA, which gets (dwindling) subsidies from the government and from taxes, the Port Authority raises all its own revenue from tolls and fees. The bi-state authority is controlled by two governors, in this case, NJ Governor Chris Christie and NY Governor Andrew Cuomo. Both men have cut taxes, and have made it clear they don’t intend to raise any more. Which means the Port Authority revenues look increasingly attractive to both men — who, after all, do have to pay for infrastructure one way or another.
Governor Christie has asked the Port Authority to use the $1.8 billion it would have contributed to the ARC tunnel to improve roads, which solves part of the budget hole created by Christie’s decision not to raise the gas tax to fund the state highway trust fund, which is broke. And the NY MTA — controlled by Cuomo – has asked for $380 million from the Port Authority for the NY MTA’s capital plan. “These raids are pressuring the fares,” says Kate Slevin, executive director of the Tri-State Transportation Campaign. “Christie is using the $1.8 billion to plug holes in the state’s transportation program.”
But Tom Wright, executive director of the Regional Plan Association, backs the plan to raise tolls. “Tolls should not be off-limits. There has to be some way to pay for surface transportation.”
This difference inevitably leads to another question: Should the MTA be self-sustaining? Should New York’s authority pull a PA and raise tolls and fares to the point where everything can pay for itself? The answer to that question gets to the heart of the meaning of public transportation, and rational minds can certainly disagree.
The general nationwide perception about mass transit is that it’s a way to improve mobility for poor people. In the City Hall News article about congestion pricing, one source even says as much: “How does transportation affect the ability of the region to grow in a sustainable way? It’s a way to invigorate a center city and bolster mass transit, which is what poor people use.”
But in New York, that perception does not align with reality. Because jobs are concentrated on the isle of Manhattan and parking space is necessarily at a premium, people from all classes need public transit, and our city’s economy depends on it. The cost of use then must be low enough for the stereotypical poor people, but it also must be low enough to disuade people who might consider driving from doing so. (Similarly, the costs of driving must be high enough to do the same.)
That argument is a roundabout way, then, of making the case for subsidies. Earlier this week, I discussed the IBO report on the MTA’s uncertain revenue streams. By relying on a volatile mix of taxes and fees, the MTA is risking financial instability. Fares and tolls provide a far more constant source of revenue, but higher fares risk pricing out people who most need transit.
The MTA then is at the fulcrum of a political fight. Some in the state want to further reduce subsidies raised by taxes and fees. Others understand the need to fund transit but only to a certain extent. Eventually, the MTA will have to rely more and more on higher fares and toll hikes to pay the proverbial bills. Without subsidies, that swipe will only get higher. Just ask PATH train riders how they feel about that.
44 comments
Raise taxes, fares, tolls so it can be self-sustaining. Make the fare $3. It sucks, but something has to be done. Show the public videos from the 80’s, remind them what it was like and what we’re trying to avoid. Remind the sheep that the MTA has had its budget raided by the State in recent years and that the MTA can’t just lower fares and improve service. The problem is not that it can’t be done, it’s that people want magic, and that hasn’t quite been invented yet.
$3 wouldn’t even come close to making the MTA self sustaining. The mistake to begin with was the creation of the MTA. In order to make a self sustaining MTA it would have to be broken up into separate entities but still maintain minimal administration in all entities. $3 fares with increased tolls under a NYCT model where NYC related bridges, roads tunnels managed by the MTA can be combined with the subways and buses.
The MTA was created to get Moses out of power, and instead of Moses replowing bridge profit into new highway construction, it would subsidize the unprofitable public transit system and remove political responsibility for NYC’s public transit from City Hall. Nothing more.
$3 should come pretty close to making the subway’s operations self-sustaining. Buses are obviously more expensive, and the suburban railroads are a financial mess.
But the labor union suck up what ever revenue hike comes down the pike. The last arbitrator used the new “bailout taxes” as a justification to give 12% raises when the rest of the city was getting pink slips. Until you get the labor situation under control NO NEW TAXES. The mta already has huge pools of taxes and sky high tolls that subsidize it. But that money was blown on poor operations and sky high labor costs. We are paying broom sweepers over $75,000 a year with benefits. REALLY IT IS TRUE. No company can operate with those types of costs. Fair wages for all!!!!!!
i am definitely willing to give the PA more $ to cross out of jersey, because the port authority is a bloodline of NYC (JFK, EWR, LGA, 42nd., and obviously, the WTC project which they are currently building at a fast pace) but can it be done in such a gradual manner where i don’t feel like 20 guys punched me in the face and stomach? $8 to $15 dollars? and PATH, i don’t mind the fare increase – but even the MTA sets it straight. do you know how insane everyone would of got if the MTA didn’t raise the $3.50 fare for years and suddenly it becomes $6.50???? they are self-sustaining, yes, i love it, but could you give us warning?
Why doesn’t the MTA & PA authority merge?
MTA already has NY & CT. Let’s do NY, NJ & CT.
and let’s extend that 7 train to New Jersey!
Interesting way to adopt a CEO —-Christopher O. Ward would run the show.
Throw in NJT while you’re at it.
Well, parts of NJT. The parts serving South Jersey should be merged with SEPTA.
I like your thinking
Would never work. After politicians and special interests are done, the difference in quality of service (vehicle cleaning, age, service frequency) between rich and poor area in TSATA would only increase.
Actually, it could work pretty well.
I agree with the sentiment that the MTA tolls and fares ought to pay for the operations of the MTA. I think it’s pretty obvious that one day soon the East River bridges will also be tolled and the money raised will go to MTA operations.
The problem with having the MTA Bridges & Tunnels pay for the subway, however, is that there’s no guarantee that those revenues would be allocated to the subway vs LIRR or MN. LIRR/MN/PATH/NJT all provide a valuable resource and reduce the inflow of cars into Manhattan.
As I’ve said elsewhere, the best long term solution for the region is an MTA that contains MTA Bridges & Tunnels, MTA NYC Transit & MTA SIRR. This would ensure that the MTA focuses on it’s job which is ensuring people can around the city.
MTA LIRR, MTA MN, NJT, PATH etc ought to be merged into a Regional Transportation Authority. The RTA’s focus should be on regional development and linking the various downtown areas in the region in a more comprehensive manner.
Revenues from the MTA should be used to pay for improvements in NYC, after all, city residents are paying a price in terms of congestion and pollution so people can drive through our neighborhoods when other transportation options are available to them.
But what you fail to understand is a part of the people paying tolls on mta bridges are from long island thus LIRR needs to get funding
ONCE AGAIN WE ARE ARGUING THE WRONG POINT. We need to cut operating costs and make people who break rules pay not people struggling to live in this city who’s taxes make it so expensive to live in even if you live in no peak areas.
There is $1-$2 billion in operating cost changes at mta agencies if the people will stand up to the labor union bullies. With these changes the workers will still be getting above market pay for there work. These changes include far better management of everyday tasks. Read over on Subchat where people are complaining that the brand new Brighton station keep getting hit by vandals while we pay a station agent to sit in a booth and do nothing at over $80,000 a year in salary and benefits. That agent should be a security officer (which in the non union world gets $10 an hour NO BENEFITS)
As long as the MTA get run as a social service agency for it’s workers TRANSIT will be unaffordable
Don’t forget about the “Port” in Port Authority — PANYNJ also has a revenue stream from the tankers, freighters and other boats that dock in Port Newark and New York Harbor that the MTA has no access to. So it’s not just a tolls-vs.-mass transit subsidies we’re talking about here.
Remember the MTA used to own Airport(s?)
http://books.google.com/books?.....38;f=false
The Port Authority also has airport revenues. And they have rental revenues from various real estate that they own (the WTC was a part of this).
What does “self-sustaining” truly mean? As long as airport revenues are being used to pay for the WTC, and bridge tolls are being used to pay for subways, there is some semblance of one revenue stream subsidizing the other. Self-sustaining, to me, means that rail pays for rail (though its fair to lump subways, PATH, NJT, LIRR, and MNR together), bridges and tunnels pay for bridges and tunnels, airports pay for airports, etc – on a regional level. Which, as suggested above, means merging parts of MTA with parts of the PA. As it stands, the NY Thruway Authority must be shaking in their boots over how the PA just shortened the life of the brittle Tappan Zee bridge with its GWB fare hike.
In this case it means the PA does not have to call the Governors of each state for a bailout. It doesn’t necessarily matter how they use airport revenues. Most airport construction is funded by the feds anyway.
The mta bailout was a bailout of the labor unions.
The best way to support the mta is to take action to improve the economy and ridership levels and to right size labor costs. The mta is in the red up to it’s ears but it’s workers are some of the most highly paid Government workers in the state.
It is not fair to the riders
The article offers two main reasons to keep fares low: to keep them affordable for the poor and to make transit use attractive relative to driving. The first is an admirable motive, but would be better accomplished through direct cash transfer. Right now instead of giving a poor person $2, New York gives the MTA $4 – $2 to subsidize a poor person’s ride, $2 to subsidize a banker’s trip from the Upper East Side to Midtown. It’s pretty clear the second person does not need a public subsidy.
To the driving issue, it’s not obvious to me why New York state has an interest in spending hundreds of millions to dissuade people from driving. Especially when we are already spending hundreds of millions to subsidize driving!
I like breathing air without particulates.
Your plan to ban diesel trains and eliminate the electricty that powers electric trains (and the Internet) is noted. Our air will be as clean and fresh as it was during pre-industrial time swhen many people lived well into their late 20s.
Or maybe it’ll be as clean and fresh as it was in 1900, when first-world infant mortality was 100 and London had smog episodes that make today’s LA look pristine.
You think the air is like that now? You should go outside once in a while.
No, but neither is it like the air in Geneva. Or for that matter Syosset.
It isn’t all that much cleaner in Syosset. Lots of pollution in New York City blows in from New Jersey, Lots of pollution in New Jersey blows in from Pennsylvania. Lots of pollution in Pennsylvania blows in from Ohio. … and so on. You could stop any burning of anything in New York City and the air quality would still suck.
…. much better than it used to be when, like London smog, it killed people.
I will settle for the mta shutting the diesel train off when not in use instead of what they are doing now.
Thank the FRA for that.
That’s a good argument for taxing particulate production – whether it comes from personal driving or public transit operation. We could make good progress in moving the installed automobile platform, and our energy infrastructure generally, toward non-polluting options. And we’d raise revenue as opposed to spending it.
But let’s not delude ourselves into thinking that somehow MTA subsidies are a sort of environmentally-friendly spending. If we care about reducing particulate production we should be talking about how to pass the MTA’s carbon tax costs on to its users, not how to subsidize its activity.
“Right now instead of giving a poor person $2, New York gives the MTA $4 – $2 to subsidize a poor person’s ride, $2 to subsidize a banker’s trip from the Upper East Side to Midtown. It’s pretty clear the second person does not need a public subsidy.”
The banker is the one who is paying the taxes that support the subsidy therefore he is paying for himself. The solution is to have fewer poor people by expanding said person money making potential .
Instead labor union and politicians are more interested in social justice and making money for themselves
The case of the Stella Dora cookie factory and the armory project in the bronx are perfect examples
The banker pays taxes privately and collects bailouts publicly.
Maybe he’s paying taxes, maybe not. We don’t check that someone’s a New York state taxpayer in good standing before letting them on the subway.
One way to handle subsidies while keeping the operation self-sustaining is to do what higher education is doing it these days: set the fare to a level that covers your costs, then offer financial aid to the less fortunate.
It’s also important to note that the Port Authority is subsidizing what amounts to two subway lines with its bridge and tunnel tolls. Meanwhile, the MTA has the entirety of the NYC Subway system to run on (very roughly) the same amount of bridge and tunnel tolls. Not to mention the LIRR and the MN. And they don’t have the airport and harbor revenue the PA does. So if anyone tries to make the “self sustaining” argument based on the PA, it’s definitely an apples to oranges comparison.
Proportionately NYCT gets less subsidy than LIRR+MN. In fact if you got rid of buses the subways with B+T could probably support themselves operationally at a fare of …..what? $3.25…. $3.75?
How about proximity based taxes assessed to each (occupied) residential unit and (leased) trip generating commercial/industrial/whatever space with the amounts varying by proximity to subway stop or bus line? Charge the highest to those places nearest transit service and decrease as distance increases. Charge more for subway access, less for bus service. Those uses not within a 10 minute walk from service would pay nothing. Use those funds to pay for capital improvement. Those apartments and stores nearest to transit ALREADY benefit from their proximity even if some choose not to use it.
Thanks to GIS, we can calculate this sort of thing
Unworkable and still does not address the fact that the MTA ALREADY GETS TONS OF SUBSIDES. You must right size operating costs and work rules. The unions are squeezing the system dry and no new revenue will change that.
you have ticket collectors on LIRR making six figures . INSANE
New Revenue
1) $25 mta surcharge on all moving violations
2) camera’s on front of all buses that automatically take pics of people parked in bus stops and in bus lanes or double parked blocking bus movement
3) major roll out of red light cameras in mta service area with all money going to the mta
4) doubling of fare beating, littering and door holding fines. Former conductors on trains and station agents can assist the police.
Let people who violate the rules pay
We can not run service to get politicians re-elected. In Brooklyn 1) the R shuttle has two person train operation for political reasons only
2) Express bus service is run on weekends (and now sundays since mta bus takeover) with virtually no one on the bus when subways are nearby.
There are so many problems the way the mta operates and these need to be addressed FIRST
I don’t see the big deal with holding the doors open. I mean, the train is delayed for a few seconds, but it isn’t causing major delays.
In any case, there aren’t a whole lot of express bus lines that carry nobody on the weekends. There are just a few (the QM4, BM4, QM15, BxM4 and just a few others)
Ride the 4,5,6 during rush hour and let me know if people holding doors is OK. Delays of a few seconds on the Lex express are a nuisance and cause delays on a line with such small headways.
The city and state can not enforce basic tax laws such as the tobacco tax.
20% of residents are illegal aliens . Any such tax scheme will fail.
I am in favor of using current transit assets that can improve the value of real estate. ala west side 7 line. Some of this increased real estate value should be returned to the mta.
O RLY?
I sure am. I also collect welfare, social security, medicaid, section 8, disability, a union salary, and food stamps under numerous assumed names (including Reginald Bolwerk). When I shop, I use a car service service to bring home t-bones to my malnourished children, even though I get a free Metrocard. I also deal drugs, and bought a mansion in the Hamptons with the proceeds. Ronald Reagan warned you about me back in 1976, but you didn’t listen!
But you have to consider that some services are more useful than others. A person living near a bus line running every 5 minutes would pay the same as a person living near a bus line running every 30 minutes. The first line (every 5 minutes) makes a greater impact than the second line (every 30 minutes).