Paterson Calls MTA’s Capital Plan 'Unaffordable’

The Metropolitan Transportation Authority’s $28.08 billion five year-capital plan is unaffordable, New York Gov. David Paterson said yesterday, adding that the State Department of Transportation’s $25.8 billion five-year plan is too costly as well.

“Unfortunately this plan, and the plan the MTA submitted on Oct. 1, are simply unaffordable given New York’s current fiscal condition,” Paterson said in a statement. “We cannot afford a multiyear plan until the economy improves, the federal government provides adequate multiyear funding, and the Legislature joins me to seriously address the structural imbalance in the state budget.”

Paterson said the state’s road and bridge plan must be “need-based” and “fiscally prudent without relying heavily on bonding.”

Funding details of the Transportation Department’s capital plan, released yesterday, were not available at press time, but like the MTA it relies on a combination of sources, including bond proceeds.

The federal transportation program is currently operating on a 30-day extension that expires at the end of the month because Congress did not pass a new one before the last program ended on Sept. 30. Lawmakers have pushed for longer extensions ranging from three to 18 months.

Raising taxes to fund the state transportation and MTA programs in the absence of federal funding and in the face of declining state revenues was not an option, according to Paterson.

This week he ordered $500 million of spending cuts to state agencies to help close a $2.1 billion current year deficit that has been caused primarily by falling personal income tax revenue.

The MTA board approved its five-year capital program last month and sent it to the capital program review board, an oversight body made up of representatives from the governor’s office, the Senate majority, Assembly majority, and New York City mayor. Each member of the board has veto power.

The plan assumed the MTA would receive $8.4 billion of federal funding, which state Comptroller Thomas DiNapoli’s office said was a 56% increase that “may not materialize.” Even with increased rederal funding, the plan faced a $9.91 billion shortfall.

Although the capital plan assumed the MTA would sell $6 billion of bonds backed by new revenue streams enacted this year, the comptroller’s office said in a report last month that the financial plan assumed it would sell $16.5 billion of bonds if it didn’t receive additional funding to fill the nearly $10 billion gap. The increased bonding would cause annual debt service to more than double to $3.5 billion in 2020 from $1.5 billion in 2009, the comptroller’s office said.

MTA spokesman Aaron Donovan said that the authority was aware of the regional economic situation and the state’s weak financial picture.

Paterson’s statement drew a mix of responses from state lawmakers.

“Instead of a five-year transportation capital program, Gov. Paterson saw fit to release his take on the plan while simultaneously striking it down and placing the onus on the Legislature,” Sen. Martin Malavé Dilan, chairman of the Senate Transportation Committee, said in a statement. “I would like the time to review the plan before it’s publicly written off.”

Dilan, a Brooklyn Democrat, said that the governor’s actions served to “undermine the Legislature.”

Assemblyman Richard Brodsky, D-Westchester, said the state needed to find a way to fund its transportation programs.

“Our infrastructure is the backbone of our economy, and we cannot allow it to be crippled,” he said in a statement. “We must find a way to do the road and bridge program. New York needs the jobs, New York needs the roads, and New York needs the bridges.”

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