MTA Politics

Assembly representative Annie Rabbitt believes lowering the MTA CEO's salary would help job retention.

When Jay Walder came to New York, he did so from the lucrative consulting firm McKinsey after working for Transport For London. Based on somewhat recent figures, TFL executives make upwards of $800,000, and top-flight McKinsey consultants make even. When he accepted the job in New York, then, Walder, a leader everyone would agree has impeccable credentials, had to take a paycut to re-enter the public sector in the United States.

His high-profile departure, then, two weeks ago came after years of hand-wringing over his $350,000 annual salary with the MTA. High by most standards, that figure is a small portion of what he will make when he starts his job with Hong Kong’s MTR, and New York’s inability to offer salary competitive with international public transportation agencies or the private sector will likely hinder its ability to find top talent in the future.

For months, the TWU and New York politicians took aim at Walder’s salary. He was, after all, making more than Gov. Andrew Cuomo and only $50,000 less than the President. He was also in charge of a sprawling organization that has over 68,000 employees and operates trains, buses and bridges 24 hours a day, 7 days a week, 365 days a year. Balancing the salary needed to lure qualified hirings against the economic realities of the organization and public perception of high-paid workers has become a tall task.

Still, Albany isn’t helping. Annie Rabbitt, an Assembly Republican from Greenwood Lake in Orange County, has penned an open letter to Gov. Cuomo urging him to lower the salary of the next MTA CEO and Chairman, because clearly that will help attract the kind of people we need to see the MTA through its dark economic hours. She writes:

While I am confident that you are giving careful consideration to candidates – with special consideration to their ability to stand up to the corruption that has long-plagued the MTA – before announcing your appointment, I would like to respectfully suggest that the salary of the MTA chair and chief fiscal officer be reduced to no more than your own current salary.

As you stated during your executive budget presentation in February, in reference to the salary of school superintendents, managing their budgets is certainly difficult but cannot be more difficult than being the governor of New York state.

Furthermore, given the MTA’s request this week to incur another $6.9 billion in debt, I am sure you will agree that restoring fiscal balance to this agency must be a top priority and anything we can do, including limiting the $350,000 per year MTA chair salary, will help send a message throughout the agency that a new day has come – a day that I hope will bring fiscal solvency to the MTA, help restore and expand services, reduce fares, and most importantly, repeal the job-killing payroll tax once and for all.

As we continue working together to reform New York State and restore our economic prospects, I believe this small, but meaningful step will help bring some much-needed reforms to the MTA. I look forward to your response and continuing our efforts to better the lives of New Yorkers, particularly those in Orange and Rockland counties.

Rabbitt’s “small but meaningful step” will bring the wrong kind of reform to the MTA. Instead of sending a message of fiscal responsibility, it will broadcast to the world that qualified candidates need not apply because New York politicians clearly won’t respect your job or reward you for the work that needs to be done. It’s reverse psychology at its worst.

The ultimate issue isn’t whether or not its tougher to run the MTA than it is to run New York State. It’s probably tougher to run New York State than it is to run Hewlett Packard, but no one says its CEO shouldn’t get his $1.2 million. It’s going to cost something to reform the MTA. It’s going to cost something to get top minds in top positions. Until Albany comes to terms with that, we’ll be left with unqualified, independently wealthy political cronies and campaign supporters who haven’t ridden a train in years. That isn’t real reform.

Remember that Captain Obvious report buried on a Sunday by Comptrollers John Liu and Thomas DiNapoli that highlighted how the MTA handles service changes and track work? It seems that some folks did not take too kindly to Liu and DiNapoli’s blustering attempt at a blatant headline grab. The Daily News’ editorial board, for one, found the report misguided and petty.

Here’s how they put it:

The press release trumpeted that the state and city controllers had conducted their first joint audit in more than a decade. Thomas DiNapoli (Albany) and John Liu (New York) had trained their collective investigative firepower on the Metropolitan Transportation Authority, their highly paid publicity aides announced. Gee, they must have discovered something huge. Right?

No, not exactly.

The report released Sunday by DiNapoli and Liu was more like a junior high school research paper than a serious examination of the state of mass transit in New York City. Did you know that auditors visited 39 subway stations where service had been diverted for track repairs? And did you know, horror of horrors, that the transit authority posted no more than 20 signs in each station alerting riders to the disruption? Well, now you do, thanks to the crusading of DiNapoli and Liu, who want every straphanger to know whose side they are on.

While this is one of the oldest PR tricks in the book, rarely have two such high officials attempted it with such feeble results. It goes this way: Zero in on something that annoys riders, such as service disruptions for repairs. Then count up the numbers and look for anything that suggests the MTA is bollixing up the work.

The News, not exactly a friend of the MTA’s over the years, has a better solution: Focus on the big picture and show how “the MTA is struggling to complete necessary repairs and system upgrades without proper state funding.” The paper is probably being a little tougher on Liu and DiNapoli than they need to be, but their point — that nothing new comes out of the comptrollers’ offices — is one I’ve made before. All we hear about from them are issues the MTA has already vowed to address or institutional problems that transcend an audit.

Once upon a time, the Citizens Budget Commission explored how funding from Albany for the MTA’s capital plans had dried up over the course of the Pataki Administration. If DiNapoli and Liu want to make waves, they should conduct that forensic audit of the MTA’s books while looking at Albany’s support as well. Perhaps then they would find real savings and real reform rather than the complaint that stations which see a few thousand riders per day have only 20 service change posters instead of 50.

I missed this gem when Jay Walder originally announced his resignation a few weeks ago, but as Gov. Andrew Cuomo has yet to name a successor, it’s still timely. From Little Littlefield comes a job description:

Wanted, politically savvy transit manager willing to preside over the gradual re-collapse of New York City’s transit system due to deferred maintenance while denying it is occuring, be publicly blamed for the consequences by those actually responsible (all of whom drive everywhere to parking spaces reserved for them by placard), and hated by the suckers who believe them. In exchange for decent pay, little work, and a fat pension.

The successful applicant is expected to live outside New York City in an undisclosed location, and not appear in public except during the first half hour of public hearings, during which elected officials castigate them for the very situation they created while the MTA head sits in silence. Among the key selection criteria are the willingness to not object to an assertion that a 20/50 pension enhancement wil cost nothing, the willingness to go on borrowing money the MTA cannot possibly repay, and the ability to make sure those affluent municipal bond holders and Florida residents get paid, no matter what. Any interest in actual transportation is optional, as most public services are optional as well. However, the ability to come up with cutsey distractions like shifting the transit map around to generate favorable New York Times press is always helpful. Apply to Sheldon Silver and Dean Skelos Andrew Cuomo.

Larry might be slightly more pessimistic about the MTA’s physical future than I am. I believe we’re witnessing only the political and economic collapse of the transit system and not the physical collapse as well. Yet, this critique is right on the money, and it highlights how the next MTA head will be in a very tough position with little support and a future that does not look too bright.

For two years, Jay Walder was literally and figuratively the center of attention at the MTA. (Photo by Benjamin Kabak)

The week of Jay Walder has continued into August as civic leaders and politicians are still coming to grips with Waler’s departure. The biggest news came from a Times article published on Saturday that illuminated Walder’s motivations for leaving.

As I’ve heard from the beginning, much of the impetus behind the MTA CEO and Chairman’s decision came about because of money and circumstances. The MTR offer simply overwhelmed his current MTA salary, and he had grown tired of politicians who would use the MTA as their personal whipping boy without offering political or fiscal stability. But our new Governor, who hasn’t embraced transit and never warmed to Walder, had much to do with it as well.

Michael Grynbaum and Christine Haughney report:

Jay H. Walder, chairman of the embattled Metropolitan Transportation Authority, traveled to Albany earlier this year seeking help for a transit system in peril. Mr. Walder, a kid from Queens who rose to the top of his field and harbored big ambitions for his state, was not unlike the man he had hoped to see: Gov. Andrew M. Cuomo.

And he did see him. For a moment.

Mr. Walder was meeting the governor’s staff at the Capitol when Mr. Cuomo walked in. The governor greeted Mr. Walder, then promptly turned his attention to his director of state operations, Howard Glaser, with whom he spoke for several moments before departing, said two people familiar with the meeting. Mr. Cuomo and the man in charge of the biggest mass transit system in the nation did not meet in person again, suggesting a lack of interest by Mr. Cuomo that irked and discouraged Mr. Walder, several officials said.

The Times notes that Cuomo was “caught…by surprise” by Walder’s departure and “had no plans” to replace him before his term expired. Yet, still, Cuomo reportedly shunned Walder and has garnered more headlines for his collection of muscle cars than he has his support of transit.

During his campaign last year, Gov. Cuomo vowed to stand behind the MTA. “I believe the governor should be accountable for the MTA,” he said in October. “These authorities that are often nameless and faceless–I understand the theory behind an authority. I also understand the theory behind accountability. In a situation like the MTA. I think that people have the right to know who’s in charge, who’s responsible and I think it should be the governor of the state.”

Now, Cuomo can put his money where his mouth is, and he will have some fight on his hands. The Times has urged him to avoid naming a political friend as head of the MTA and urged him to find someone who will “provide the best service for 8.5 million commuters.” Crain’s New York suggests two women for the job: either Karen Rae, currently with the Federal Railroad Administration, or Polly Trottenberg, assistant secretary for transportation policy at the U.S. Department of Transportation who once worked for Senator Chuck Schumer.

No matter who Cuomo picks, the next MTA head will have to negotiation with the labor unions, deal with fare hikes and debt levels and confront a system that must move forward with its capital plans as money grows ever tighter. It’s an unenviable job, and the number of people qualified to take it are quickly dwindling. Soon, Cuomo will have to name a replacement. For now, though, we’ll continue to find out just how the governor’s lukewarm embrace of the MTA head helped push him toward a decision to depart.

When The New York Times broke the news earlier this week that weekend subway ridership was on the rise, I knew it would only be a matter of time before New York politicians began to call for investigations, studies and audits of the MTA. With weekend service marred by construction projects and route diversions, these politicians wouldn’t let an opportunity for exposure slip by, and perhaps, something good could come of their calls as well.

The representative who rode to the proverbial rescue is one who has worked closely with the MTA, and his results have produced good in the past. Daniel Squadron, the State Senator from New York’s 25th District who represents the Lower East Side and Williamsburg, put out a call for a study. This isn’t the first time Squadron has issued such a call. In fact, in 2009, he urged the MTA to assess the F train performance, and the authority eventually vowed to make some improvements to the much-maligned route in Brooklyn.

This time, Squadron has written to request a review of the L train’s performance. Using the report from The Times, the Senator said in a statement, “Today’s report underscores the fact that weekend subway service is simply not keeping up with New York. Working together in 2009, we improved F service and created a model for future progress. Now we must reapply that experience and ensure dependable service every day of the week.”

A letter he penned to Transit president Thomas Prendergast expressed similar sentiments. “At some stations on the L and F lines weekend ridership is as high – or higher than – weekday ridership,” he wrote. “Yet the trains’ schedules do not account for the higher weekend usage. I would also like to request that the MTA review weekend ridership on the L in Williamsburg and the F in the Lower East Side, with the goal of creating a schedule that is more reflective of ridership patterns. This would not just make the subway more convenient for riders. By drawing weekend visitors to these neighborhoods underground and off of surface transit, it would also improve quality of life in these areas.”

I am certainly sympathetic to Squadron’s calls, and I’m glad he’s the one latching onto the report. But from the get-go, I wonder how much Transit can do to improve the situation. I took a look at the turnstile data from June to check out what The Times discovered, and I was surprised to see a nearly negligent difference between weekend and weekday ridership at the Bedford Ave. stop in Williamsburg. But east of Williamsburg, ridership drops precipitously. The same happens to the F when you compare weekend travel to Second Ave. with the rest of the line.

It seems as though Squadron and others want the MTA to add service to the lines for the weekends, but it doesn’t make much sense. As long as train crowds are within load guidelines and demands further along the routes do not dictate more frequent service, the MTA likely won’t add routes to service a few stops. They could, however, look to shorter service. The L train has a switch just east of Bedford and one past Myrtle/Wyckoff. It’s possible that the authority can run extra trains from 8th Ave. to Myrtle Ave. and then them back around to provide more service over the popular parts of the route.

Right now, though, the MTA has its request, and it knows its limitations. Work must go on, and service demands generally aren’t as high on the weekends as they are during the week. The authority can’t handle a few isolated peaks at the expense of its bottom line, and the valleys are steep. But Squadron has issued its charge, and the authority will respond in turn.

Dean Skelos and the Republican Senate majority up in Albany know they have it good right now. As the Assembly is still controlled by Sheldon Silver and a Democrat sits in the Governor’s Mansion, the Republicans can pass a series of measures designed to fulfill promises made to constituents and interest groups without actually delivering on the policies. Lopsided bills will pass one house and not the other as State Senators can go back to their constituents to point out faux-accomplishments.

Of course, if either party or both parties in Albany are going to play politics with anything, it will be with the MTA, and the Republicans in the Senate did not disappoint. We first start with S04637. This is a fun bit of legislation in that it mandates that the MTA contract and pay out of pocket for a forensic audit with results delivered by January 1, 2013. If anything, it shows that the State Senators are learning.

Now, for much of the past few years, we’ve heard repeated calls for a forensic audit, and the term is a vague one. While Thomas DiNapoli as State Comptroller has the authority to straight-up audit the MTA, a forensic audit is one usually conducted at the target’s expense designed to root out not just wasteful practices but criminal expenditures. For example, a forensic audit would search for examples of embezzlement, fraudulently procured contracts and other types of criminal waste.

Within the past few months, a group of Independent Democrats have put out a call for a forensic audit. Citing the ever-popular “two sets of books” charge and begrudgingly admitting that the MTA’s budgeting process is far more transparent than it was eight years ago, the IDC claimed that the MTA should spend the $10 million because it might find evidence of improper spending practices that could lead to criminal charges, and it might find savings to cover the expenditures. It (perhaps rightly) doesn’t seem to trust the MTA, but as the politicians are the ones arguing for a forensic audit, shouldn’t they fund it too?

The point is largely a moot one; the Assembly isn’t likely to approve the forensic audit bill. In fact, the last time it did so, it expressly included language that required the state to pay for the audit, and the funds never materialized. Here, at least, the GOP in the Senate can say they tried as Jay Walder has continued to push for internal financial reform and a streamlined process of expenditures.

The forensic audit though is hardly the worst of the bills. The one that came out of the Senate concerning the payroll tax is. I briefly touched upon this bill yesterday, but it bears another look. Essentially, Lee Zeldin’s plan to repeal the payroll tax for the suburban counties while shifting the tax burden onto the city without identifying other equitable sources of revenue for the MTA cleared the Senate.

And, boy, was Zeldin pleased with himself. “I am very pleased to announce to my constituents, residents of Long Island and the rest of the 12-county MTA region that the state Senate has passed legislation to repeal the job-killing MTA Payroll Tax,” he said. “There is absolutely no doubt that the MTA, without increasing fares or cutting services, can balance its books after this legislation is implemented. One must question the motives and veracity of any individual or group that attempts to dispute this fact going forward.”

Except there is doubt. It’s impossible for the MTA to find $1.5 billion in annual savings without significantly curtailing services or jacking up the fares. In a classic political twist, he blames those who would dare defend transit subsidies or the MTA’s budget. Now, I don’t care much for the payroll tax, but I’ve spent a lot of time looking at the MTA’s budget documents. This is not an agency that can cut an additional $1.5 billion out of its $12 billion budget. Between debt payments, fixed operating costs and employee costs, the savings just aren’t there, no matter how stridently Zeldin claims them to be.

Another State Senator issued an equally laughable claim. “It’s time for the MTA to stop balancing its budget on the backs of hard-working New Yorkers,” Senator Greg Ball said. Does he think by raising the fares the MTA won’t also be balancing the budget on actual hard-working New Yorkers who can’t afford automobiles and soon won’t be able to afford monthly rail passes? Does Ball think only non-hard-working New Yorkers would suffer from service cuts or fare hikes? Do politicians in Albany doubt our ability to think critically?

To make matters worse, the Republicans tied in the payroll tax repeal with a measure for which advocates have been pushing: a transit lockbox. In the same bill as the repeal, the lockbox, which I discussed in May, cleared the Senate. So with one hand, the State Senate is supporting transit while with the other hand and in the same piece of legislation, they are robbing transit.

Ultimately, this piece of legislation doesn’t matter much in the short term. Sheldon Silver has said that the payroll mobility tax isn’t going anywhere. He at least recognizes that to remove the tax revenue would require a different source of funds, albeit congestion pricing, bridge tolls or much higher fares, and that’s not a conversation he’s ready or willing to have right now. But the moves tonight provide a glimpse into the thinking of those in charge, and it’s clear that no one is willing to lead on transit with good, sound, practical policy ideas. It’s only about scoring points with constituents while the millions of people who need the buses and subways and commuter rail lines are looked down upon and ignored.