(Source: The Transport Politic)

State Senate finally comes to agreement on system’s adequate funding; will vote today

The Metropolitan Transportation Authority, which has been threatening huge fare increases and drastic cuts in service, will be able to rest easy tonight, because its multi-billion-dollar budget deficit will be covered by a new, more stable source of revenue: a region-wide payroll tax. There will be no bridge tolls, but a small fare increase. Though this is no panacea, and more funding is still needed, but this is huge news for New York City and means that the city will continue to be able to offer its citizens high-quality transit at a reasonable price.

The solution — held up for weeks by the demands of a few Democrats in the Senate (no members of the GOP are willing to vote for the program) — was found by agreeing to reimburse school districts that are affected by the tax. 

According to Gotham Gazette (via 2nd Ave Sagas), the plan to be voted on this afternoon will raise a total of $2.26 billion a year for the transit agency. This plan will cover the $1.8 billion MTA’s budget gap for FY 2009 and the $2 billion gap for 2010 as well as provide a small amount for capital expenditures. The New York Timesclaims that the taxes will be enough to cover the first two years of the agency’s 2010-2014 capital program. The state is likely to have to get going over the next few months to shape a funding system for necessary subway and commuter rail repairs as well as expansion needs.

Here are the basic conditions:

• 34¢/$100 payroll tax in all 12 MTA counties, with no differences between them (meaning people in Manhattan pay the same amount as people in Nassau County, even though people in the former clearly are more likely to take advantage of the transit system than those in the latter): $1.5 billion/year.
• 10% fare increase, will likely raise the cost of a single ride to $2.25 from $2 today; monthly unlimited cards will go from $81 to $89: $500 million/year.
• 50¢ surcharge on taxi rides: $85 million.
• $25 vehicle registration fee on the MTA region: $130 million.
• Increase on car rental fee: $35 million.
• Increase on driver’s license fee: $10.5 million.

The plan also foresees fare hikes of 7.5% in 2011 and 2013 to keep up with inflation.

(Source:  PBS’ Blue Print America)

This afternoon I received a couple of alerts  from PBS’s Blue Print America.  There first report is about the Budgetary Issues facing transit agencies:   

As the economy has slumped, Americans have increasingly turned to mass transit, putting new pressure on transit agencies. In a new report for the “Blueprint America” series, correspondent Rick Karr examines the budgetary issues facing public transit.

Click here to view the video report. 

The second report focused on the subject of how the financial meldown has added to the woes of the transit agencies. The excerpt reads:

Amid the country’s economic crisis, some public transit agencies have found themselves linked to complex financial deals that have since soured. Rick Karr reports in the latest installment for the “Blueprint America” series on infrastructure on The NewsHour with Jim Lehrer.

Click here to watch the video report.

(Source:  PBS Blueprint America)

In a two-part series for Blueprint America on The NewsHour with Jim Lehrer, correspondent Rick Karr looks at budget disasters on both sides of the ledger for public transit agencies.

 In part one, Karr looks into the growing deficit in what it takes to run day to day operations of buses, subways, and trains — deficits that have prompted more than 60 agencies nationwide to propose fare increases, service cuts, or both, even as more Americans are using transit than at any time in the past 50 years. In part two, Karr looks into a looming crisis on the capital side of transit agencies’ budgets, the result of complex financial deals that the agencies made in the 90s to stretch their meager budgets, but which melted down with the rest of the financial sector — and could leave cash-strapped transit systems owing bankers hundreds of millions of dollars.

The following is a breakdown of Transportation and Infrastructure stimulus funding by state. In total:

• highways and bridges: $26,810,000,000
• transit capital: $6,733,700,000
• fixed-guideway modernization: $742,500,000
• clean water: $3,860,698,173

TOTAL: $38,146,898,173

(Source: NYTimes.com)

Plummeting tax and fare revenues that have been depressed further by the ailing economy could increase the Metropolitan Transportation Authority’s budget deficit this year by $650 million, according to a new estimate made public on Monday. If the doomsday forecast is borne out, the authority’s deficit this year could grow to nearly $2 billion.

Subway ridership fell 2 percent in January compared with last year.

The authority has already proposed a steep increase in fares and deep service cuts if it does not get a state bailout. But if its finances worsen significantly, it could be forced to take even more drastic measures.

“This is obviously breathtaking,” Gary Dellaverson, the authority’s chief financial officer, said as he presented the projections to a meeting of the authority board’s finance committee.

Click here to read the full article.