Doomsday Budget

While New York sits in fear of fare hikes to come, straphangers can spy a slight glimmer of hope at the end of the fare hike tunnel. The MTA isn’t planning on preparing to implement the 23 percent fare hike and the massive service cuts approved this week until May. That still gives Albany until the end of April to act.

“We really have the month of April before people get impacted,” MTA CEO and Executive Director Elliot Sander said this week. “You could reverse some of these actions in May, but they will already start taking place in terms of hitting our customers.”

As the MTA gears up for the latest fare hike, Pete Donohue explained how Albany action could stave off the hikes before the end of April:

The higher subway and bus fares take effect May 31. Commuter train fare increases take effect on June 1 – but June passes go on sale in May. Most service cuts would be phased in between June and December.

With each passing day it becomes more expensive and difficult to halt or scale back the service cuts and hikes, officials said. Subway and bus fares aren’t changed with the simple push of a button, officials said.

New fare tables have to be compiled and then downloaded to every turnstile, token-booth computer, MetroCard vending machine and bus fare box in the bus and subway system, NYC Transit spokesman Paul Fleuranges said. Staffers must go to thousands of individual pieces of equipment and verify data in advance of the May 31 fare-hike date, officials said.

The Tri-State Transportation Campaign echoed Donohue’s report. “There are many paths elected officials can take, but only two possible futures,” Steven Higashide wrote. “In one, state elected officials get behind a comprehensive, long-term plan that addresses the MTA’s operating and capital budgets and allows for continued investment in the region’s transportation network. In the other, they pass a half-solution or do nothing at all, and the system steadily deteriorates.”

Hopefully, Albany will pick the former. But as time ticks on and nothing emerges from the State Senate, I grow less optimistic by the day.

As the MTA Board voted to pass a Doomsday package consisting of a 23 percent fare hike, the elimination of two subway lines and the scaling back of late-night and weekend service, the New York State Senate finally passed a comprehensive bailout package. The tax-and-toll plan will scale back the fare hike to a mere eight percent, avoid the service cuts, pare down the MTA debt and fund the agency’s ambitious capital expansion program.

Oh wait. Just kidding. Let’s try that again.

As the MTA Board voted to pass a Doomsday package consisting of a 23 percent fare hike, the elimination of two subway lines and the scaling back of late-night and weekend service, State Senators fell back on the same finger-pointing and party bickering that has come to dominate the Albany discourse. Our politicians again tried to blame a supposedly uncooperative MTA for Senate inaction and offered up the red herring of the commuter tax, another D.O.A. politically infeasible plan.

After fielding G.O.P.-targeted criticism in the city’s papers this week, Republican leader Dean Skelos blamed the Democrats for inaction. “The closed door discussions by the three New York City Democrats running state government have failed to produce an agreement on the MTA to prevent fare hikes, just as the closed door discussions on the state budget have failed to produce an agreement, with the deadline just a week away,” Skelos said in a statement.

Skelos has offered Republican support for an MTA bailout plan if it is tied to a road-and-bridges package for the upstate area.

Meanwhile, as Mayor Bloomberg urged the Senate to “do something,” one Senator took it upon himself to try. Martin Dilan, the head of the Senate Transportation Committee, proposed reinstating a commuter tax.

Support for the bill is dicey, and those who want the commuter tax reinstated believe the benefits should flow to the City and not the MTA. “The New York City commuter tax should be for New York City,” Senator Tom Duane said. “And if we hadn’t lost those millions from the commuter tax years ago, we wouldn’t be in such a dire situation with regard to the M.T.A.”

What the difference is, I don’t know. The City will benefit from a healthy and funded MTA. There’s also no guarantee that at any point the Senate would have diverted the flow of funds from the city to the MTA, as Duane suggests.

Furthermore, this proposed plan just won’t cut it. When the commuter tax was repealed during a good economy in 1999, it was estimated to bring in between $210-$360 million — or $267-$458 million in 2009 dollars. The MTA’s budget gap is $1.2 billion and climbing.

The tax has also suffered from historica bipartisan opposition. Upstate and Westchester-based Senators from both sides of the aisle felt the commuter tax unfairly burdened their constituents. With today’s G.O.P. mounting an ideological attack on the Ravitch Plan’s payroll tax, to assume a commuter tax — a plan far less equitable than bridge tolls — would pass defies reality.

(For an interesting debate on the commuter check, check out these two 2002 articles from the Gotham Gazette: pro and con. In a bad economy, the “con” argument seems a lot stronger to me.)

In the end, Senate Majority Leader Malcolm Smith issued another half-hearted plea for patience in an attempt to defend himself. “We are clearly still working towards a solution for them,” Smith said. “There’s still some time before they actually institute the raise.”

If this is the Senate “clearly” working toward a solution, I’d hate to see what they do when they actually want to get something done. Smith inspires no confidence, and while there is indeed some time before the cuts and hikes are implemented, I don’t have any faith in the State Senate. Do you?

Friend-of-SAS Chris O’Leary, better know as the East Village Idiot, also happens to be a fellow transit advocate. Today, in advance of the MTA Board’s approval of the 23 percent fare hike, he penned an excellent piece disputing some common misconceptions about the state of the MTA’s finances. I was getting set to write a very similar post, and Chris offered to allow me to reproduce his.

So below is a guide to popular myths about the MTA’s budget problem. City Room comments certainly could use this primer. Be sure to check out East Village Idiot for a mostly humorous and sometimes serious look at life in New York City.

Today, the MTA will vote to raise fares again… this time to the tune of 23%. Your monthly Metrocard that cost you $81 this month will cost you $103 in June.

Yes, it’s outrageous. Yes, it’s unfair. But no, it’s not entirely the MTA’s fault. In fact, this fare hike could have been easily prevented by Albany in the past and present, but everyone finds it easy to blame the MTA for this. Stop blaming the MTA, and blame the people who deserve to be blamed.

Myth: The MTA can find the money, somewhere, to stop this hike

When people say this, I ask, how? Nobody has an answer, they just have a feeling. Well, I invite anyone who wants to make this claim to go into the MTA’s financial statements and find enough money to fill their $1.3 billion deficit. It’s not possible. They are out of money. And there’s a good explanation, which brings me to my next myth.

Myth: The MTA got into this deficit by spending too much on big projects

Updated (1:30 p.m.): Say good bye to the W and Z trains, good weekend service and low fares.

In a 12-1 vote, the MTA Board has approved its so-called Doomsday budget in its legally mandated effort to balance its budget.

The new fare structure will be as I detailed last night (and as presented below), and the new fare rates are set to go into effect on May 31. Late-night and weekend service cuts could go into effect even earlier, and the Z and W trains along with numerous bus routes will be eliminated in their entirety.
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This is truly a sad day for supporters and riders of transit in New York City, and the blame for this lies squarely with Albany.

While the battle for now has been lost, there is a faint glimmer of hope. The MTA Board said that today was not the final Doomsday. If Albany acts soon, the Board could put off the service cuts and reduce the fare hike. Politicker NY’s Eliot Brown reports:

Still, the drama continues, as this was not actually the drop-dead deadline for avoiding the fare hike. As many MTA board members noted, the board can take back the action should Albany agree on a new funding package. The fare hikes are slated to go into effect in June, while the service cuts would start earlier.

The Mayor’s Office however warned of at Albany punt. Albany could enact a short-term measure that is a politically popular measure but does nothing to address the inherent problems of the MTA. Writes Brown:

Jeff Kay, a mayoral appointee on the board and director of the mayor’s Office of Operations, was rather pessimistic, suggesting that even if there is a rescue, it will only be a short-term fix that doesn’t get at the root of the problem (not enough long-term reliable funding).

It’s possible, Kay said, that “they’ll come through with what’s politically expedient, which is, make sure fare hikes don’t go into effect.” But even so, “we will be back in two months saying we still have a problem if they just do the politically expedient thing.”

The drama continues.

At 9:30 a.m., the MTA will meet — or will have met, depending upon when you read this — to vote on, among other items, a 23 percent fare hike and massive service cuts to its transportation offerings. While a prior commitment will prevent me from live-blogging the proceedings, you can catch a webstream here. The fare hike happenings will be early on, and I’ll have an update on site as soon as I’m back at my computer.

Meanwhile, on Doomsday Budget Eve, New York politicians and the newspaper editorial boards that love and loathe are all pointing fingers at one august body. Right now, the State Senate and its leaders on both sides of the aisle are getting creamed by pols and papers alike.

The party started earlier this week when the Daily News based both Malcolm Smith and Dean Skelos, the Senate Majority and Minority leaders respectively, for their failing to support the MTA. These politicians, both from transit-dependent districts, have known for a year about the transit doom heading New York City’s way, and then two of them stood by idly as comprehensive proposals to fix the MTA’s finances were supported by everyone else but the Senate.

Late yesterday afternoon, Sheldon Silver, the man responsible for killing congestion pricing in 2008, hopped on the Blame the Senate bandwagon. While Silver’s obstructionism last spring shut off one source of dedicate revenue for the MTA, he guaranteed that the Assembly would pass the Ravitch Plan. His statement:

Let me be clear, the Assembly Majority is ready to pass a plan to save the MTA and prevent a massive fare hike. Our plan would prevent the proposed cuts and fare hikes by sharing the burden of transit costs. Those who use the bridges would pay a toll that is equal to what New Yorkers pay for a subway or a bus ride, and employers would invest in the system through a small payroll tax. We had hoped that the Senate would support our plan. The Assembly is prepared to act on this proposal to avoid the huge fare increases and draconian service cuts that would have a devastating effect on all New Yorkers.

Mayor Bloomberg, echoing a famous line from Network, urged New Yorkers to call their Senators in Albany to urge them to save transit. “If Albany doesn’t come through, then the straphangers are going to have to bear the brunt of this. I don’t think that’s good for the system. I don’t think it’s good for our economy,” Bloomberg, a man who knows a thing or two about money, said. “But we cannot walk away from mass transit. We have to have it. So I hope it doesn’t get to that, but if it does, what I would suggest when you see what’s going to happen to your commuting costs, you should call your state legislators and say, ‘I’m mad as hell and I’m not going to take it anymore.'”

And finally, today’s editorial in The Times names names. Writes the Grey Lady of Republican Senators from New York who won’t deviate from the strict anti-Ravitch stance of the state G.O.P.:

Among city Republicans who should be interested in helping the M.T.A. are Senators Martin Golden of Brooklyn, Frank Padavan of Queens and Andrew Lanza of Staten Island. There are also a few Republicans upstate who should be trumpeting the Silver plan because of businesses in their districts that depend on the M.T.A. They include Senators Elizabeth Little of Glens Falls, Joseph Griffo of Rome and George Winner of Elmira.

As the State Senate turns its back on eight million riders a day, the M.T.A. can’t just wait. They could start preparing fare machines and scheduling delays set for June — unless Albany wakes up and comes to the rescue.

So that’s that. In 10 hours from my writing this, the MTA Board will have approved a fare hike/service cut plan to balance its budget as required by state law. Those who write the laws, though, won’t act and won’t take responsibility for their inaction. As Bloomberg and Silver do, as The Times and The Daily News do, I too blame our State Senate for the decline and fall of transit in New York City at a time when we need it most.

When the MTA Board meets tomorrow morning, they will approve a drastic fare increase that will look something like this:

• Pay-per-ride subway and bus fares increase from $2 to $2.50. Whether the 15 percent discount will remain is up for debate.
• Express bus fares will increse from $5 to $6.25.
• 1-Day Unlimited Ride MetroCards increase from $7.50 to $9.50.
• 7-Day Unlimited Ride MetroCards increase from $25 to $31.
• 14-Day Unlimited Ride MetroCards increase from $47 to $59.
• 30-Day Unlimited Ride MetroCards increase from $81 to $103.

The math, by the way, for figuring out the value of the unlimited card remains virtually the same. If the MTA retains the 15 percent discount, anyone who rides 48 or more times a month should buy a 30-day card. Otherwise, just pay per ride.

As New Yorkers adjust to these 24-27 percent hikes, transit advocates and news outlet alike are wondering how subway-dependent straphangers are going to adjust to the increase costs. City Room posed the question yesterday, and Streetsblog followed up with their own thread today. The Times also wants to know who among us constitute the 2.1 percent of riders that buy single-ride cards. I say tourists.

In response to these questions, most people claim they will change their habits. Some people say they were bike more; others say they will turn to cabs; still others say they will simply cut back on a drink or two. We’ll see if that comes to pass.

I plan to do nothing diffrent. The extra $22 a month is a pain especially in a bad economy and with worse service on the way. In the grand scheme of things though, unlimited access to all of New York City for $103 a month is still a great deal. It’s far cheaper than taking a cab. It’s far cheaper than owning a car and driving

But that’s just me.

The MTA Finance Committee is currently meeting to debate and vote on the fate of the Doomsday budget. I’ll be liveblogging the event for you.

At 11:45 a.m., the MTA’s Finance Committee will meet to approve recommendations for a fare hike and service cuts in an effort to close a budget gap in excess of $1.2 billion. While Richard Ravitch had proposed a plan that, through East River bridge tolls and an equitable payroll tax, would minimized the hike and cuts, a bitterly divided Senate could reach an agreement, and while Sheldon Silver’s Assembly was prepared to pass a modified Ravitch Plan, the Senate has tabled any MTA rescue package for now.

As this drama has unfolded over the past few weeks, Gov. David Paterson has taken up a lot of airtime urging Senate Majority Leader Malcolm Smith to get his caucus in line. The Democrats, who hold a 32-30 majority in the Senate, have been bitterly divided on the issue with many objecting to the tolls. On Friday, Paterson changed his stance a bit and based the State Republicans for doing exactly what he wants the Democrats to do: holding rank. The Republicans refuse to support the Ravitch Plan because it includes a payroll tax, and while it would be far worse to let mass transit in the city fail, the New York GOP is closing ranks on ideological grounds.

Pete Donohue and Glenn Blain talked about Paterson’s ire in the Daily News this weekend:

Paterson rapped Senate Republicans for taking a partisan stance against a revenue-raising plan, crafted by former MTA Chairman Richard Ravitch and featuring tolls on the East and Harlem River bridges. “I’ve been talking to them about this for the last four months,” Paterson said, referring to the GOP. “And I think that if 30 members of a party all vote the same way – what we used to call that when I was in the Senate was a party vote.”

There are 32 Democrats in the Senate and 30 Republicans. Several Dems oppose tolls, so the Ravitch rescue needs the support of at least some Republicans. Paterson said the package would not only avert whopping fare hikes and service cuts, but fund the MTA’s capital construction and maintenance program.

The program is a significant source of jobs in several upstate districts where there are subway and bus assembly plants, and other businesses with MTA contracts. “I don’t see any reason why they wouldn’t be voting for it because it has a direct economic, imperative affect on their districts,” Paterson said.

While Republicans denied to the Daily News reporters Paterson’s statements, the sentiments ring true. If even a handful of New York Metropolitan Area GOP Senators were willing to support the Ravitch Plan, not only would the MTA stave off a 23 percent fare hike and massive service cuts, but the entire state would benefit from sage investment in transit infrastructure.

Alas. It is not likely to be. New York politics remains stuck in a heavily bipartisan world where compromise between parties is unlikely and even sanity among a solitary party, as the Democrats have shown lately, is not to be expected.

Later this morning, the first of many days of reckoning will arrive. Just remember that the politicians — and not the MTA heads — are the ones responsible for this mess.