The MTA, along with the rest of the world, is in crisis. As social distancing has become the norm in New York City and the service industry has disappeared within the span of a few weeks, the bottom has dropped out of the MTA’s once-rosy ridership projections. After the city witnessed sustained subway ridership growth for the first time in a few years, no one is riding as ridership has plummeted by about 60% earlier this week, and the numbers should look worse in a few days.
Along with this ridership drop comes a huge loss in potential revenue. Already, the MTA is incurring massive extra costs in its attempt to clean subways, buses, commuter rail cars and stations to combat the spread of the coronavirus, and without riders, the revenues are gone. The agency is warning its bondholders of significant material events (a financial term for “very bad news”), and Pat Foye has asked the federal government for a direct $4 billion bailout.
As MTA Chairman Pat Foye said on Wednesday when announcing the MTA’s plans to draw down its credit line, the agency has “encounter[ed] a fiscal cliff.” I’ll have more on the grim details once the situation stabilizes, but today, I have an emergency podcast. Joining me to discuss what this current pandemic means for the MTA’s budget is Nicole Gelinas of the Manhattan Institute. We spoke for about 25 minutes, and Nicole talked us through the dire fiscal straits the MTA is in.