Gov. Andrew Cuomo, seen here with a bridge, has been making a flurry of MTA moves lately to further cement his grip on the organization he controls, but the why of it all remains murky.
Over the past few weeks, thanks to Reinvent Albany’s lengthy report on MTA reform [pdf], I’ve been thinking a lot about the structure and role the MTA Board plays in agency governance. When you really drill down on it, you can easily reach the conclusion that the MTA Board is a meaningless entity designed for one thing and one thing only — giving the Governor of New York apparent cover for all matters MTA and serving as a convenient whipping boy when things go wrong.
Think about it: What exactly does the MTA Board do? It doesn’t hire or fire any part of the MTA management. The governor does, through his appointment of the MTA Chair and CEO (and approval of any agency president or other high-profile hires). It doesn’t negotiate contracts. It doesn’t set policy. It doesn’t develop a budget. It simply votes — up or down — on initiatives prepared by MTA staffers, who are all under the purview of gubernatorial appointees. Sometimes, the MTA Board raises a question or two and delays a vote for want of information, but the Board doesn’t and can’t shape policy. Ultimately, the Board just rubber-stamps major procurements and other initiatives put in front of it by the governor or those acting on his behalf.
Take, for example, the recent hullabaloo over overtime spending. It seems likely that some of the LIRR overtime accrual is the result of fraud that should be prosecuted, but most of the overtime spending at non-LIRR agencies and at New York City Transit in particular is a direct result of Gov. Andrew Cuomo’s Subway Action Plan and ongoing emergency order. As I detailed in a post on this subject in May, the Subway Action Plan and the Governor’s insistence on pushing through everything as fast as possible led to a huge spike in overtime spending.
By itself, that’s fine. The subways needed to be blitzed by repair work, and while I still believe Save Safe Seconds has had more of an impact on improved subway performance than the action plan, the action plan has helped (for example, by focusing on basics such as clearing out clogged drains). But Cuomo has been so obsessed with overtime spending that he can’t or won’t focus on the good overtime vs. the bad overtime. It’s all just a negative to him, and so he’s pushing through his own plan to combat overtime, exposing the MTA Board for the empty vessel it is.
During last month’s contentious meeting, most of the board members overruled the objections of Larry Schwartz, Cuomo’s enforcer on the MTA Board, to turn down a request for the agency to hire a prosecutor to investigate fraud. These board members instead recommended a consultant to help the MTA reform its time-and-attendance practice while relying upon the new MTA Inspector General (appointed by Cuomo) and the proper state or county Attorneys General to prosecute the fraud. But that led to one disgruntled governor, and so he went to work.
As Dana Rubinstein reported for Politico New York last week, Cuomo simply overruled the MTA Board and decided that the agency will hire a former prosector to investigate overtime abuses anyway. As Rubinstein notes, Carrie Cohen, the Morrison & Foerster partner who will be approved next week, will cover similar ground as the new MTA IG, and those who opposed the appointment initially weren’t happy. “This was all debated once and defeated,” John Samuelsen, TWU International president and MTA Board member, said to Rubinstein. “This has now become an example of, ‘If I don’t get my way the first time, we’re going to ram it down throats anyway.’”
Cuomo is a master at this type of exploitation, and he’s using the overtime scandal to dubious ends. Following the appointment of the new MTA IG and a subsequent tampering of a time-tracker at an LIRR office, another time clock was damaged, this time at a New York City Transit facility. Cuomo lumped the incidents together, but I’ve since been told by multiple MTA sources that the second incident was an accident. Furthermore, it impacted a time clock used by managers and not rank-and-file who are accused of running the overtime fraud. Cuomo, in public statements, claimed they were all related, and this may be another part of his unnecessary and one-sided battle with Andy Byford. I’ll come back to motive shortly.
Meanwhile, Cuomo is barely even trying to hide the way he’s manipulating the MTA. Take the makeup of the Board. We know Cuomo controls the plurality of Board seats, for what that’s worth when discussing a rubber-stamp organization, and lately, he’s taken to making the most of it. Word recently emerged that Cuomo was looking to name Albany-based state budget director Robert Mujica and Linda Lacewell, the current nominee for Superintendent of the New York State Department of Financial Services, to the Board, but the governor doesn’t currently have two seats to fill.
The Post got to the bottom of things: Reportedly, Michael Lynton, confirmed to the MTA just this spring, will be (or has been) booted from the Board, allegedly for being too independent. Fernando Ferrer will also be leaving his post. Replacing Lynton with Mujica will require the state legislature to waive residency requirements, and it’s not at first clear why they should. Is Mujica that important to the MTA Board for the legislature to waive these requirements in a last-minute hearing this week or next? If they do waive these requirements, what’s stopping Cuomo from naming upstate allies to a downstate board anyway?
Cuomo, in a radio appearance on Alan Chartock’s show last week, claimed Lynton’s independence had nothing to do with the move. Said the governor to his pal on WAMC:
Michael Lynton, when I put him on, the need was to bring new tech firms into the MTA sphere because the MTA keeps contracting with these bad contractors who I believe they have an incestuous relationship with. And the new issue became these, over the past couple of weeks, the US attorney’s investigation the Queens DA in vandalism of time and attendance systems. So, the way a coach will shift players depending on what’s happening on the court, basketball, and the need Michael Lynton, who’s great, and is from the tech world and I think that bringing new tech vendors. Today the need is financial expertise, anti-fraud systems. So I switched for the state budget director, who is a financial wizard, in my opinion, and can safeguard the state money and the Department of Financial Services commissioner who is a former federal prosecutor and is very good on financial fraud. It had nothing to do with Fernando Ferrer or Michael Lynton, who are both great, I’m going to put them on other boards.
But this move isn’t an innocent one. In a long and rambling statement released during the height of the L train debate in January, Mujica called for full gubernatorial control of the MTA Board. It was a bit of a sleight of hand since, as I’ve detailed above, the governor already controls the management and operations of the MTA, but you can see why and how Cuomo is stacking the board with third-term loyalists. These appointees play fast and loose with their own financial disclosure requirements and may not even live in the MTA service area. This doesn’t strike me as a shift toward better governance.
So back to the question of motive. For all of these machinations, maneuvers and public misdirections, I’m hard-pressed to figure out what Cuomo is after and why. He may, as has been loudly discussed in transit circles over the past few weeks, be looking to push out those who are outside of his circle and who get credit for good work they do. He may be leaning on the MTA, a prominent organization and one that plays a large role in the city and state, as a way to reward those still loyal to him after nearly nine years in office. He may simply have it in his head that he can fix things. But as with many areas, his moves seem to be responsive and reactive rather than proactive, and he’s not attacking the roots of the MTA’s many problems (or allowing those who can free rein to operate).
The MTA sits on the edge of a cliff, and one push in the wrong direction can send everyone and everything tumbling off it yet again. Is Cuomo chipping away at the foundation or building a stronger one? I lean toward the former but wish for the latter, and I don’t know why or where it all goes from here.
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What will Governor Cuomo do about LIRR employee overtime and pension abuse has been going on for years? It has been repeatedly documented by internal MTA, Office of MTA Inspector General, State Comptroller, Citizens Budget Commission, Empire Center for Public Policy audits and reports, along with numerous newspaper stories. Governor Cuomo and his appointed MTA Chairman Patrick Foye and MTA Finance Committee Chairperson Larry Schwartz outrages on this issue remind me of Captain Renault from “Casablanca” who said “I’m shocked…shocked to find that gambling is going on” while at the same time collecting his winnings. Union leadership has out negotiated management at contract renewal time for decades. It is evident that MTA & LIRR do not have an up to date payroll system which would flag such abuses. Supervisors who routinely sign off on overtime work hour abuses by employees need to be held accountable. The same is true for those who manage agency budgets, along with MTA board members, MTA senior management team, agency Presidents and the MTA Chairman.
Diogenes is still searching for someone to represent riders and taxpayers who foot the bills. Asking MTA police to serve as truant officers makes no sense. Fighting crime and fare evasion along with protecting MTA capital assets is clearly their primary mission. Besides, MTA police periodically have their own excessive overtime problems. What’s next, will the MTA hire retired teachers to serve as part time “hall monitors” to insure overtime is legitamate.
At the upcoming contract negotiations, will Cuomo direct MTA management that he controls to insist that future union contracts include more flexible work assignments and reduce salary increases? What about contracting out more work to the private sector or hiring part time employees? Will they ask employees to increase their contributions toward medical coverage (LIRR non union workers only have to contribute 2%) for medical insurance and retirement pensions? Most other public and private sector workers pay far more out of their pay checks for their respective health care coverage. Will future pensions be calculated based on the final year’s base salary and not inflated by overtime? Talk is cheap while actions speaker louder. Why has Cuomo not signed on and endorsed Assemblyman Michael Fitzpatrick submitted legislation that would prohibit overtime payments from being factored into a retiree’s pension calculations. You could also use the federal employee civil service model. Federal employee civil service retirement pension calculations are based upon the average past three years salary prior to retirement. It doesn’t include overtime. Will Cuomo (who will ask for transportation union endorsements, campaign contributions and volunteers) when running for a fourth term in 2022 stand up against his benefactors and openly support MTA management in instituting these reforms during contract renewal negotiations? Will riders have the stomach to put up with potential work slow downs, service disruptions, employee sick outs and potential strikes by unions who are not going to be willing to give up these perks? Without these changes, it will continue to be the status quo.
Project cost containment along with fast tracking procurements and contract change orders for the Metropolitan Transportation Authority is sometimes is easier said than done despite Cuomo’s promises of reform in this area due to other significant obstacles.
MTA union work rules sometimes prevent contracting out work to the private sector. Third party private contractors require MTA NYC Transit, Long Island and Metro North Rail Roads agency Force Account (their own employees) to provide both supervision and protection. when they work on or adjacent to active right of way track. There sometimes are excessive numbers of MTA supervisory or employees assigned, adding to costs.
The MTA, State Department of Transportation, Thruway Authority, along with Bridge and Tunnel Authority receive billions each year from the Federal Transit and Federal Highway Administrations. “Buy America” requirements for both transit, bridge and highway projects are one of many requirements for receipt of federal funding. This impacts the MTA’s ability get the best bang for the buck, when spending $7 billion in direct federal formula grant funds, potentially several billion more in competitive discretionary, New Starts and Hurricane Sandy relief and resiliency dollars under the MTA $32 billion 2015 – 2019 Five Year Capital Program. The MTA has its own “Arts in Transit” 1% expenditure requirement. Governor Cuomo has his own “New York Buy America Act” as well. These issues will continue under the next MTA 2020 – 2024 Five Year Capital Plan.
FTA “Buy America” requirements continue to play a role in the ability of the MTA to both speed up capital projects and contain cost growth. Second is the Davis Bacon requirement of paying prevailing wages. Third is US Cargo preference requirement for private companies to use only American vessels when shipping product from abroad. Finally, prime contractors sometimes have problems finding qualified Disadvantaged Business Enterprise (DBE) sub contractors with specialized skills to meet required federal and state civil rights goals.
Is the FTA in a position to waive any of these requirements for transit projects? Anyone in the transit industry knows that compliance with federal Buy America rules and regulations frequently adds both time and cost to a project. Both the East Side Access to Grand Central Terminal and the Second Avenue subway are good examples of how federal requirements add to costs. You can count on one hand the number of Buy America waivers issued by FTA to transit agencies in recent years.
(Larry Penner is a transportation historian, writer and advocate who previously worked 31 years for the United States Department of Transportation Federal Transit Administration Region 2 New York Office. This included the development, review, approval and oversight for billions in capital projects and programs for the MTA, NYC Transit, Long Island Rail Road, Metro North Rail Road and MTA Bus along with 30 other transit agencies in NY & NJ)
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Cuomo’s motivation? Self-aggrandizement. He really knows nothing about policy of any sort, but he wants to make himself look like a big man.
He’s occasionally bright enough to jump in front of a parade. So the way to get something done with Cuomo is to build an unstoppable grassroots movement and dog him at every turn, until he announces that he’s going to do what you want, and it was his idea, and he’s a big leader.
He’s pretty pathetic, really. I wish we could elect a better Democratic governor.
“MTA IG and a subsequent tampering of a time-tracker at an LIRR office, another time clock was damaged, this time at a New York City Transit facility. Cuomo lumped the incidents together, but I’ve since been told by multiple MTA sources that the second incident was an accident.”
He wants to slash funding to the city to make up for scams in the suburbs as a matter of fairness. If all the other Governors got to do it, why not him?
If there was fraud committed on the subway, I’ll bet it was committed by NYCT workers who live on Long Island. It’s really the NYC corruption of a century ago, relocated to the suburbs, where it is killing them — and even now, us.
New York City residents and users of the subways are prisoners of Albany. With so little control over the system other than voting for governor and state representatives, it’s amazing to me that the City’s state representatives and our own City Council and mayor are essentially silent and therefore, in a way, complicit in this. For a variety of reasons, including poor mass transportation in NYC and the region in general, I have wound never voting for incumbents – they don’t do anything.
When Governor Crony is in charge, especially when he’s running for a fourth term, he forces the residents of NYC to fend for themselves against Albany and Upstate NY, the Hudson Valley and Long Island. This issue goes all the way back when the MTA first founded in 1969.