MTA Board Forwards $29B Capital Plan to Albany
The $29 billion capital program of New York's Metropolitan Transportation Authority is on a train bound for Albany.
On Wednesday, the MTA's board unanimously approved the intricate, five-year plan that city and state officials announced two weeks ago after a year of acrimonious give and take.
Sealing a funding gap that last year stood at $14 billion, it includes $8.3 billion from New York State subject to legislative approval, and $2.5 billion from New York City – quintuple the city's original commitment. Nearly $3 billion is self-funded through bridge and toll revenue.
The state component, should the legislature approve it, would probably come through bonding. Upstate and Long Island lawmakers might push to bundle it with a statewide road- and bridge-fix initiative, possible through a 30-year bond.
Speaking with reporters at MTA headquarters in lower Manhattan after the meeting, Chairman Thomas Prendergast likened the difficulties of the past few months to a steeplechase, a race in which runners must clear a series of hurdles and water jumps.
"We had it in senior gym," he said, chuckling. "They had steeplechase and they made the hazards up as they went along."
Funding variables such a state approval and means of dispersal still exist.
"We're not there until we're there, but I'm very confident that we'll get there," Prendergast said.
According to board member Jeffrey Kay, work still needs to be done.
"This is not new," he said. "We've seen money come several ways. The details are very, very important."
Moody's Investors Service called the deal a credit positive for the agency, which operates the 100-year-old city subway system, two commuter rail lines and several bridges and tunnels.
"Without the additional funding, the MTA's options were to cut or defer projects or issue additional debt supported by fares," said Moody's.
A state capital program review board, which rejected a $32 billion request without prejudice in October 2014, must ratify the plan.
Gov. Andrew Cuomo urged the MTA, one of the largest municipal issuers with roughly $36 billion in debt, to whittle its request through efficiencies such as procurement cost savings.
"Whenever the issue how much debt we have out there, we have those healthy tension dialogues, whether it's too high or too low," said Prendergast. "Then the board makes an informed decision. We'd like not to have any debt, but then you won't be able to do state of good repair or normal replacement."
According to board member Jonathan Ballan from Westchester County, new ways of doing business, such as public-private partnerships, could usher in an era of innovation at one of the nation's oldest transit systems. "We could be in for some very exciting times at the MTA," he said.
If approved, the plan will enable the MTA to continue with its East Side access megaproject to enable Long Island Rail Road trains to enter Grand Central Terminal; commence the second phase of its Second Avenue subway extension from 96th Street to 125th Street; and expand Metro-North Railroad's New Haven line service into Penn Station, providing added system resiliency and constructing four stations in the Bronx.
The core of the program, $21.6 billion, is for replacing subway, bus, and commuter railroad fleets, completing the so-called positive train control security mechanism for the Metro-North and Long Island commuter railroads; and continuing the rollout of communications-based train control signaling for the subway.
MTA bonds and pay-as-you-go "paygo" funding, account for $7.7 billion, including $200 million in bond proceeds generated by savings due to low-interest federal loans under the Railroad Rehabilitation and Improvement Financing program.
Bridge and tunnel bonds and paygo account for nearly $3 billion, and a further $1.2 billion will come from MTA local funds, including asset sales and leases, bonds and paygo capital attributable to debt-service savings from the issuance of an anticipated new payroll mobility tax credit.
The funding will also help the authority continue fortifying its system from future storms such as Hurricane Sandy.
"We will use new technology to build smarter," said Craig Stewart, senior director for capital programs.