While Richard Ravitch and his commission are hard at work identifying potential sources of revenue for the cash-starved MTA, Mayor Michael Bloomberg isn’t letting the issue pass him by. Bloomberg, ever the businessman, calls upon the state to collect taxes on Indian reservation cigarette sales. For the past 14 years, since the Supreme Court decided that states could collect taxes on reservation sales, New York has opted not to enforce this rule, and Bloomberg writes that the taxes would amount to $800 million annually or just enough to cover the MTA’s budget deficit. I wouldn’t say “no” to this idea, but I’m sure the same politicians who won’t push congestion pricing aren’t going to sign up for this one either. New York City and its transit system is stuck in neutral, and Albany is to blame.
This weekend, on two separate occasions, I had the opportunity to see first-hand the state of the subway system. On Saturday evening, I took the N train from Pacific St. to Coney Island, and on Sunday, I used the Smith/9th Sts. subway stop coming to and going from Red Hook. Neither of these experiences presented much hope for the state of stations in disrepair.
The Smith/9th Sts. station has gotten a lot of press of late. Originally, the MTA had planned a full station overhaul as part of the Culver Viaduct Rehabilitation project. But when parts of the project were scaled back, the station rehab plans were placed in limbo. The station itself is a mess. The paint is beyond peeling; there are holes in the staircase; and it’s generally one of the ugliest and most run-down stations in the system. With views of Brooklyn, Manhattan and the Bay of New York, it should be a crown jewel.
Meanwhile, on that N ride through Brooklyn, the Sea Beach line journeys through Gravesend and Bensonhurst en route to the modern marvel at Stillwell Ave. on Coney Island. As the N journeys through a trench in Brooklyn, decrepit station after decrepit station pass by. Walls are damaged by leaking pipes and dirty water. Paint is gone. Platforms are cracked. The train travels past a physically unsafe and visually unpleasant set of station.
These are just two examples of a widespread problem found in our subway system. The stations are in a state of disrepair, and according to New York City Transit President Howard Roberts, these conditions may be here to stay. Angela Montefinise and Kathianne Boniello had the story in The Post recently:
The head of New York City Transit acknowledges that less than a quarter of the Big Apple’s subway stations are in acceptable condition – and says the agency is an “unbelievably long distance” from bringing the rest up to par, even with higher fares.
“There’s not anything out there that anybody is very proud of,” NYC Transit President Howard Roberts Jr. told The Post in a wide-ranging interview about the fundamental problems plaguing the city’s 468 subway stations as the agency slashes its budget and talks about raising fares twice more in the coming three years…
Roberts’ response: It’s extremely bad, and it isn’t going to get better any time soon. Roberts said the number of stations in good condition could be “as low as 100,” far fewer than his agency’s capital plan suggests.
The issue, of course, is what it always is: The MTA doesn’t have the funds to do more than maintain the status quo. “We’re not doing as many rehabs, and we have very limited capacity to maintain and clean the stations we do have,” Roberts said to The Post. “We really do not have the funding to do a first-class job.”
According to the NYCT chief, the transit agency would have to employ over 800 more station cleaners and many more maintenance workers than it currently does. So as you look around at your surroundings each morning and wonder when those streaks of grimy water and patches of missing tiles are going to go away, just know that the answer is that they aren’t any time soon. As long as we have politicians who are reluctant to think out of the box in order to fund transit, our system will continue to suffer. And that status quo will just become more and more expensive to maintain.
We’re a long way from seeing our stations in a state of good repair, and that’s a damn shame.
With both the City and State of New York facing precarious financial situations and the MTA’s deficit growing, money is tight across the board right now. With David Paterson in power, the MTA may have little choice but to raise fares. Little did we know, earlier this year, just how much Eliot Spitzer’s resignation would cost the MTA.
In a recent Newsday column, Anne Michaud explored the current relationship between the MTA and New York’s governor. Things could be better.
The story begins, in a way, with Eliot Spitzer’s long trumpeting mass transit and working closely with MTA CEO and Executive Director Lee Sander, a Spitzer appointee, to ensure a healthy transit system for New York City. The tale collapses in on itself when Spitzer is forced to resign just before congestion pricing — a potential dedicated revenue stream for the MTA — is set for a vote. The man who takes over, David Paterson, does not share the same relationship with Sander that Spitzer has.
It is in this shifting power that Michaud sees potentially dark days ahead for the MTA. She notes that Paterson has maintained something of an arm’s distance between his office and Sander. He did not intervene after Sander fielded criticism for a pay raise, and he spoke out, as he should have, against the MTA Board’s free perks. He has also second-guessed the MTA’s need for all of their fare hikes and in doing so, could be jeopardizing the future of some very big and very important projects. Write Michaud:
Transit advocates worry that, as a result, Sander will lose confidence to advocate for important projects in the next capital budget, such as the Third Track for the Long Island Rail Road. Now is an even more crucial moment for transportation than when Spitzer arrived as governor. As gas prices climb, all eyes are turning to urban-centric, transit-oriented development. Downtowns will not only be cool again, they will be essential.
Insiders say that Paterson is as committed as Spitzer was to keeping the MTA in a state of good repair. But it’s possible that, faced with difficult choices, the governor will choose to stretch out the completion date of some expansion projects such as the Second Avenue subway, East Side Access and the Third Track.
This alarming news brings us back to the current budget crunch. As Paterson struggles to find money for key services, he will look toward New York City’s transit network and view certain projects as expendable. He will tell — not ask — the MTA to defer maintenance and upgrades and delay capital construction efforts.
Again, our eyes will fall on Richard Ravitch to rescue the system. He’ll have to battle through a hostile legislature and a skeptical governor. Hopefully, he’s up for the job.
We know the MTA is facing a financial crisis; we know the threat of a second fare hike in two years looms large; and we know the MTA has planned to cut services — but not yet service — to address what is now being labeled a $700-million budget gap.
Today, we find out that New York City Transit has been ordered to cut $61 million off its budget. Those cuts will come mainly from maintenance and service jobs. Much of that figure will come in the form of bureaucratic maneuverings. Jobs currently unfilled will remain unfilled while few others will lose their positions.
Matthew Sweeney, amNew York’s transportation writer, has more:
The search for savings is part of an overall Metropolitan Transportation Authority goal of reducing costs by 6 percent over the next four years as the agency faces a financial crisis. For its part, NYC Transit has projected saving $251.3 million from 2009 through 2012. The bulk of the savings in 2009 — $39.4 million — will come from reductions to maintenance…
Transit officials worked to reassure straphangers yesterday, saying in a statement that none of the proposed savings “will have an impact on safety, security or customer service levels.”
While Sweeney’s article notes that “subway service has been on a gradual but steady decline,” to me, this seems like a baseless assertion. The MTA has gone out of its way to stress that they would rather cut maintenance and upkeep positions before taking an axe to frequency of trains. In fact, NY1 reports that the MTA is doing just that.
According to reports, the services cut will include 12-year upgrades for buses, numerous platform controllers in the subways and efforts to fight strachiti along some of the more vandalism-prone lines. For those of us relying on the subways to take us to and from spots in New York, this news is guardedly optimistic, but the system suffers from it. We’ll see the same old train service, but an aging and ugly system badly in need of physical upkeep and upgrades will continue to deteriorate.
Critics of the MTA’s cuts will think back to the 1970s when the system fell out of its state of good repair, but for now, the MTA is dedicated to maintaining subway cars and track beds in that state of good repair. The rest of the system, however, will continue to slide, but as long as the trains run and as long as the system is safe from crime, the aesthetics can take second place to the system operation. For now.
The MTA hasn’t started advertising on its (non-existent) straps as they do in Seoul. (Photo by flickr user Queenbean79)
As the talk of the MTA’s budget problems has grown, we’ve heard stories, on and off, about the agency’s efforts to attract more advertising dollars. In April, I warned riders that more ads were soon to be a reality, and in May, word leaked of MTA plans to brand the outside of rail cars.
Today, we find out that the MTA wants to add even more advertising streams, including the ever-popular in-tunnel, flip-book style advertising found in both the Boston T and the Washington Metro. Pete Donohue has more:
Ad-generated income totaled $106 million last year, up from $90 million the previous year, the Metropolitan Transportation Authority said.
That figure is expected to top $110 million this year as the MTA continues to test new strategies to capture the attention of riders – including projecting commercials onto subway station walls in the line of vision of passengers standing on platforms.
After years of consideration, the MTA this year also will test the placement of ads on tunnel walls between stations that would unfold like a flip book or silent movie as a train rolls by, officials said. “It’s high priority of ours,” MTA CEO Elliot Sander said. “We’ve made strong progress in generating new revenues, which is critical, given the MTA’s challenging financial circumstances. We’ve done a very good job with this.”
While suggesting expanding subway advertising always seems to spark a debate, it’s hard to fault the MTA for this one. The agency needs money, and they certainly have a lot of space that could be turned over to advertising. It’s easy to ignore ads, and it’s a lot better to be subjected to more ads than another fare hike.
I do wonder if the MTA couldn’t coax more than four million additional dollars out of an expanded advertising program. The opportunities are out there; someone just has to sell it.
New York City Comptroller William Thompson holds forth on the MTA as Gene Russianoff, left, and firefighters union head Steve Cassidy, right, look on. (Photo from the Comptroller’s Office)
William Thompson, New York City’s Comptroller, has launched the latest salvo in the ongoing battle between New York officials and the financially-beleaguered MTA.
Speaking Wednesday in the subway station at 14th St. and 8th Ave., Thompson urged the MTA to delay passing its revised capital program amendment featuring millions of dollars of cuts until Richard Ravitch’s commission issues its report on funding the MTA later this year.
“I understand the severity of the MTA’s current financial crisis. Operating budget shortfalls are projected to run into the billions of dollars…The cost of capital projects has mushroomed,” Thompson wrote in a letter to MTA Board Chair Dale Hemmerdinger (PDF). But the MTA should not jump the gun by putting off vital projects before Chairman Ravitch and his colleagues examine the funding situation and issue their recommendations.”
To further stress his point, Thompson invited Steve Cassidy, the president of the Uniformed Firefighters’ Association, to stand with him in the subway yesterday morning. Cassidy leads the firefighters union, and the city’s comptroller is concerned that some of the MTA’s deferred capital improvements could impact firefighters’ safety underground.
“Every one of the New York City Transit projects proposed for deferral — signal upgrades, new buses and subway cars and station rehabilitations — is important,” he wrote. “However, I am especially concerned about the proposal to delay at least $366 million in fan plant projects. Delaying fan plant projects jeopardizes rider, worker and firefighter safety. In its own project descriptions, MTA New York City Transit notes that ‘fan plants enhance safety, especially in the post 9/11 environment’ and that they are vital for the ‘life safety’ of passengers.”
Cassidy support Thompson’s pleas. “Safeguarding riders on the New York City Subway is the responsibility of the MTA and FDNY,” he said. “It is imperative that these upgrades to the emergency ventilation system are carried out immediately to ensure both public and firefighter safety.”
The MTA, however, had a bone to pick with Cassidy and Thompson, long one of the MTA’s most vocal critics on issues concerning both the secrecy surrounding its bookkeeping and the state’s and city’s shirking of their respective financial duties to the transit authority. In a statement issued Wednesday afternoon, the MTA defending itself from these charges.
“Every project in the capital program is important, but the proposed deferrals, including several fan plants, are projects that were chosen because they can be delayed without impacting the safety of the system,” read the statement. “All of the MTA’s underwater tunnels are protected with new fan plants in case of emergency, and the MTA continues to invest in other initiatives to significantly reduce the risk of fire and smoke. The MTA’s transportation network is safer than ever, and none of the proposed deferrals put that safety record at risk.”
Meanwhile, the MTA also noted that “delaying the current capital program amendment will force the MTA to halt work on critical projects currently in the plan.” Those projects, of course, include our beloved Second Ave. Subway, the East Side Access Plan, and station renovations throughout the system.
I don’t know the answer to this one, but I have to hope the MTA would not put its passengers and those working to keep New Yorkers safe in danger through capital program deferrals. I do know that the MTA’s financialy doomsday clock continues to inch closer to midnight, and while Thompson may be right in urging the MTA to wait until Ravitch’s report arrives in December, that five-month delay could be too long for an agency so vital to New York’s economic health and so close to its own economic disaster.
High gas prices are pushing more commuters onto mass transit options. (Gas $4.37 by flickr user 54east)
As Americans prepare to hit the road later today for their Fourth of July weekend travels, gas prices are at an all-time high. The national average cost for unleaded regular gas checks in at $4.092 per gallon while New Yorkers are paying an average of $4.297 per gallon. These numbers, to Americans, are astronomical.
In New York City, however, the law of unintended consequences has taken over. As high gas prices drive Americans out of their cars, a few analysts are noting that the traffic-mitigation effects of the $4.30-gallon are mimicking, to a lesser extent, Mayor Bloomberg’s failed congestion pricing scheme. In a very well done article in The Times today, William Neuman explores how traffic volume is decreasing as gas prices increase.
The gist of it is as follows: As gas has climbed well past the $4-per-gallon mark, the MTA and the Port Authority have been reported decreases in traffic through their toll booths of around 4.2 to 4.7 percent. Meanwhile, subway ridership was up 6.5 percent over the same time period with smaller but noticeable increases on Metro-North (4.3 percent) and the Long Island Rail Road (5.5 percent). The PA’s PATH trains saw a jump in ridership of nine percent. Even parking garages in the area are reporting fewer cars.
In a way, then, the city isn’t too far from temporarily achieving Mayor Bloomberg’s goals of reducing congestion. Of course, as Neuman points out, the goal of congestion pricing was to reduce traffic at peak hours, and this current reduction is more spread out. Meanwhile, it’s clear that drivers who are opting not to drive will slip behind the wheel as soon as — or is that if? — gas prices dip again. So on the flip side, high gas prices aren’t at all like the congestion pricing plan, and a few traffic consultants believe that this is a questionable decrease as many drivers, looking to save all they can, are opting for free bridges instead of toll roads. The decrease in volume could be as little as two or three percent.
There is, of course, another catch as it relates to mass transit. The analysis is Neuman’s:
Gas price-induced traffic reduction might have a downside. Mr. Bloomberg’s plan was intended, among other things, to raise hundreds of millions of dollars a year for mass transit improvements by charging cars an $8 fee to enter the area of Manhattan below 59th Street. The plan was defeated in April when legislative leaders in Albany refused to bring it up for a vote.
In contrast, the current reduction in traffic at bridges and tunnels could actually take money away from transit, because a large portion of the tolls collected at the transportation authority’s crossings helps to finance the subways, buses and commuter railroads. In May, toll revenues were more than $4 million below budget projections, and Gary J. Dellaverson, the authority’s chief financial officer, said that June toll revenues appeared to be down even further.
So far, the drop has been more than offset by an increase in fare collections generated by higher transit and rail ridership, but Mr. Dellaverson said that the combination of slipping toll revenues and the increased cost of fuel for the authority’s buses and trains could eventually outpace ridership revenue gains.
In the end, then, it’s the same old story for the MTA. A lack of dedicated revenue not tied into market forces is forcing the agency into a corner. For our city’s air, for our roads, it’s encouraging to see traffic dipping as gas prices go up. But for the health of the MTA, this artificial free-market quasi-congestion pricing impact will only serve to deprive the agency of toll revenue while taxing train lines already at or near capacity without offsetting these increases with more revenue. And that is a recipe for disaster.
Neil deMause urges Mayor Bloomberg to find a dedicated source of revenue for the MTA. The agency can no longer rely on the volatile tax revenues, and the city, he argues, isn’t ponying up nearly enough money to keep the trains running. Well said. [Metro New York]
It’s no secret these days that the MTA is in financial trouble. While the word bankruptcy hasn’t been tossed around yet, with the agency facing a few billion dollars in debt, we’re probably not too far away from that point. But an unlikely source of funds — in the form of pork — may be riding to the rescue soon.
Yesterday, in The Observer, Eliot Brown summed up the financial straits in which the MTA currently finds itself. For the most part, Brown rehashes territory familiar to loyal SAS readers: The MTA doesn’t have a dedicated source of revenue outside of the volatile real estate taxes. Having spend years borrowing to fund both ambitious capital plans and operating budgets, the agency finds itself on the edge of a massive financial crisis.
But Brown touches upon a new source of potential revenue in the form of senior Democrat and chair of the House Transportation Committee Jerrold Nadler, one of the most influential New Yorkers in the House. Writes Brown:
At the center of the Congressional efforts is Mr. Nadler, the infrastructure devotee who is now the most senior Democrat from the Northeast on the House Transportation Committee, which is slated to reauthorize a 12-figure, six-year transportation bill in 2009 that would likely steer substantial money to the M.T.A.
“What helps is that not only am I very senior, but compared to five years ago or six years ago, we’re in the majority now, not the minority, and we have five Democrats from New York on the committee,” he said.
The M.T.A. is planning on more than $8 billion from the federal government, an amount Mr. Nadler said seemed reasonable. But much will depend on who wins the presidential election.
The presidential comment, by the way, is way anyone who cares about the New York City subways should take a good long look at the public transit policies of Barack Obama.
Anyway, the MTA is now relying on a substantial federal contribution which basically amounts to a big barrel of pork for the region from Nadler. They’re also hoping for a magically monetary solution from Richard Ravitch. Meanwhile, as MTA CEO Elliot Sander noted in Brown’s article, the agency can’t really trim the internal fat anymore. “The M.T.A. has already taken significant steps to tighten our belts,” Sander said to Brown.
This is, of course, a risky strategy for the MTA. While Nadler’s promise is refreshing and one our representatives in Albany should adopt, the federal transportation has a long way to go before funds reach New York City. The bills will have to clear the House and the Senate, and a president — Bush or whoever wins in November — will have to sign off on the bill. If John McCain captures the White House, it won’t be a result of any voters in New York.
The promised money from Nadler is a start, and it’s refreshing to hear from a New York politician who is willing to get money into the coffers of those agencies who need it. But I’m afraid that this might be too little, too late. We need Albany to take the MTA’s financial situation seriously. We need more money for our transit network before it gets much worse.
The rehabilitation plan for the Smith-9th Sts. subway stop is just one of more “deferred” projects. (Photo by flickr user Victoria Belanger)
Ah, to yearn for the innocent days of November when it seemed like the MTA would actually be rehabbing the stations along the Culver Viaduct while they did the necessary engineering work on the Viaduct itself. Or perhaps we could revisit the days of early June when the MTA said the 4th Ave. station wouldn’t be getting an overhaul, but the Smith-9th Sts. station would enjoy a face lift.
Now, it’s all gone.
One day after we heard the rumors, the MTA issued a series of financial statements that include alarming real estate tax projections and what officials are terming deferrals for various capital projects — including the Culver Viaduct station rehabilitation plans — in an effort to cull together nearly $3 billion in short-term savings. The long-term prognosis for the MTA is hazier and bleaker.
William Neuman reports on this alarming and expected story:
In a series of public meetings of authority board committees, officials said the authority would be forced to cut projects valued at $2.7 billion from its 2005-9 capital spending program, largely because of soaring costs on construction projects already under way.
The projects being cut include 19 subway station renovations and important projects for the modernization of subway signals and repair facilities. The authority’s chief executive, Elliot G. Sander, said those projects were expected to be included in the authority’s next five-year spending plan, which begins in 2010. But he acknowledged that the authority did not yet know how it would find the financing for that plan.
Officials also said the revenues from taxes on real estate transactions, which have buoyed the day-to-day operations of the transit system in recent years, were falling off at an alarming rate, resulting in a shortfall this year of $122 million. Revenues from the real estate taxes are on track to end the year about $280 million below budget projections.
With fuel costs skyrocketing, the MTA finds itself already $60 million over budget for 2008 with no sign of economic relief in sight.
According to Neuman’s report, the MTA is going all-out with the trimming. Foremost among the projects cut is the station rehab plans for the Viaduct. The Smith-9th Sts. station will remain as it is now, with boarded up windows, peeling paint and a generally unappealing aesthetic vibe. Joining it in rehab limbo will be a series of Brooklyn stations along the D and N lines and some Bronx 6 stations. The Brighton Line rehab plans may be saved simply because they aren’t too far along in the planning process.
The MTA is also sacrificing behind-the-scenes upgrades needed to keep the trains running. It is scraping parts of an in-progress signal modernization plan; it is doing away with proposals to install vents in the tunnels to clear the air in case of a fire emergency; and it is starting to cut aspects of their big-ticket items (but more on that later today). The MTA is, in other words, beginning to sacrifice quality due to money, not because they want to but because they have no choice.
In defense of these actions, the MTA officials say they will reapply for funding for these plans when the 2010-2014 capital plan comes up for review next year. These projects, officials maintain, will see the light of day. Of course, the problem with that assertion is that the MTA is facing capital budget deficits upwards of $10 billion, and unless Richard Ravitch can save the day again, we are facing a subway system in dire financial peril.
The problem, of course, lies with the way our public transportation network is funded. In short, it isn’t. The MTA relies on real estate taxes at the whim of a market and puts too much pressure on capturing fare revenue for operating and expansion plans. There is no secure dedicated source of revenue.
Apparently, no one learned any lessons from the 1970s. With the subways in shambles, the city collapsed. As the city rebounding and the subways did too, New York enjoyed a nearly unprecedented boom. Now, as the nation’s economy slows, our public transit network is paying the price of negligent overseers. Until Albany realizes that a healthy MTA is the key to the economic well-being of New York City, the agency is in for a rough ride.