New York MTA chief renews call for more federal aid
The chairman of New York's Metropolitan Transportation Authority on Wednesday reinforced the need for additional federal funding while the effects of the COVID-19 pandemic has pushed its finances into freefall.
"This is undoubtedly the toughest time in MTA history," Patrick Foye at said Wednesday's virtual board meeting. Foye himself has recovered from the coronavirus. As of Wednesday, 83 employees from the 70,000-plus workforce have died from the virus.
The MTA, which received $3.8 billion under the federal CARES Act, has asked Congress to double that amount.
Stay-at-home requests, business closings and social-distancing have triggered ridership drops of more than 90% on the state-run authority's subway and bus system.
Toll revenue from the interborough bridges and tunnels it operates are way down while massive disinfecting of stations, vehicles and facilities have sharply driven up operating costs. Subway cleaning costs alone could reach $500 million this year.
The board on Wednesday unanimously ratified a COVID-19 family benefits agreement. The MTA, calling it the first in the nation, said it reached 41 agreements with 26 different unions, and will extend it to non-represented employees.
Benefits include a payment of $500,000 from the MTA to the spouse, beneficiary or estate of any worker who died as a result of COVID-19, in addition to providing health insurance for three years to the spouse and dependent children for three years up to age 26.
Additionally, the MTA supports calls for the federal government to provide hazard pay for front-line MTA employees who continue to work during the pandemic.
The MTA, one of the largest municipal issuers with $45.6 billion of debt including special credits, stands to lose up to $8.5 billion this calendar year, according to a report by consulting firm McKinsey & Co.
Moody's Investors Service, S&P Global Ratings and Fitch Ratings downgraded the authority over the past month, citing the coronavirus' effects. Moody's now rates the MTA's transportation revenue bond credit A1, while S&P and Fitch rate the bonds A-minus and A-plus, respectively. Kroll Bond Rating Agency has the MTA on review for possible downgrade.
According to data on the Municipal Securities Rulemaking Board's EMMA website, a block of Series 2016-2A transportation refunding bonds maturing in 2038 that originally priced at 111.235 cents on the dollar and a 2.74% yield sold to a customer Wednesday at a price of 99.925 cents and a 4.006% yield.
Chief Financial Officer Robert Foran said the MTA has $3.4 billion of liquidity and is soliciting additional lines of credit from commercial banks. He cited "positive indications of interest."
Foye said keeping the transit system open is essential to transport healthcare and other essential personnel.
Challenges the MTA will face post-pandemic include how it mitigates crowding fears through train traffic management and other means. Subway crime has also spiked during the crisis.
"The ridership is essential. If we don't have enough riders, we don't have the revenue and if we don't have enough riders, it means people aren't really going to work," said Mitchell Moss, director of New York University's Rudin Center. "It's not something that is optional."
Protecting MTA workers and riders is also a must, according to Moss.
"There are some things that are doable and some things that will take long-term," Moss added. "The subway materials are going to have to be ones which are more resistant to bacteria. There are different kinds of poles, different kinds of handles, different kinds of materials.
"And we should find a way, and I really mean this, to take our fashion designers and turn them loose on masks. We should do to masks what the athletic footwear industry has done to sneakers."