Over the years, the MTA has not always used its best judgment when giving away money. In December of 2005, for instance, facing a variety of unfunded obligations — many of which still exist today — the agency reduced fares to $1 for the month as a way to give back. Some board members wanted to bank the surplus, but it passed anyway. A few weeks into the the discount program, the TWU went on strike, and eight years later, we’ve all but forgotten that brief fare blip.
Today, in 2013, the MTA has, in a sense, announced a different sort of giveaway. With various economic indicators on the rise and internal restructuring identifying perennial savings in excess of projections, the agency may not need to rely on fare hikes to cover large gaps, as originally projected. With the TWU’s contract situation outstanding, the agency’s current forecasts rely on a net-zero wage increase, but still, the MTA is confident enough to announce that out-year fare hikes will be lower than originally planned. Instead of increases every two years of 7.5 percent, the agency is looking to generate a pair of four percent hikes.
Many observers feel this is the right move. The 7.5 percent jumps were aggressive. Fares are still lowering in adjusted dollars today than they were before the onset of unlimited ride MetroCards in 1996, but the planned increases far outpaced inflation. It seemed too tough to ask passengers to continue to foot these bills every other year with no end in sight, and the IBO predicted $168 30-day cards by 2023. It was, some say, too much to ask of riders.
In today’s amNew York, the editorial board of the free daily makes that argument. Noting that fares went up, in some sense, by nearly 25 percent during an economic downturn, the paper politely applauds the MTA for showing some restraint:
While the MTA’s smaller projected fare hikes are plenty welcome now, they’re still not what we’d call a great leap forward. They’re just a smaller step backward. The plan — which the MTA board still must vote on — would slap riders with separate 4 percent increases in 2015 and 2017 instead of 7.5 percent increases. That’s roughly in line with inflation.
We’re pleased that the MTA — in its own tough-love way — does seem sensitive to recent sacrifices by riders. There are other ways it might have chosen to spend this windfall, which comes from internal belt-tightening and a pickup in real estate and ridership revenues. T
he agency — more than 68,000 employees strong — must hammer out a labor contract with the Transport Workers Union soon, and the TWU has had its eye on this money for awhile. There’s also the eternal imperative for upkeep — stations that need rebuilding, signal systems that need updating, track that needs replacing — an agenda made all the more urgent after the devastation of Sandy. So, while everyone has a hand out, the MTA wants to give its customers a break. It’s a smart move, and a good way to build a stronger base of customer support.
Allow me to play Devil’s advocate for a second, and question the smart move. Right now, the MTA can maybe promise a smaller fare hike, but what if everything collapses around it? If the TWU wins a big wage increase and if tax revenue drops, if the state raids its coffers, if another disaster strikes, that money is now gone. The MTA would have to swallow its pride and suffer at the hands of indignant riders and politicians if they roll back the decreased fare hikes, and it’s just impossible to predict the economics in a few years.
So instead the MTA has given up a few hundred million dollars of guaranteed money. Fare hikes remain the only way the agency can control its fate, and now, four years away, they’ve been reduced. I’m happy not to pay even more in 2015 and again in 2017, but if anything goes wrong, that’s a tough pill to swallow.