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.
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