The New York Metropolitan Transportation Authority's finance committee yesterday passed a detailed toll and fare increase schedule as already depressed dedicated tax revenue collections weakened further.
Unless the Legislature acts on a rescue proposal, fare and toll increases outlined in the schedule yielding an additional 23% in revenue are expected to be passed by the cash-strapped authority's full board tomorrow.
Under the new fare structure, subway riders beginning in June will pay $2.50 for a single ride instead of $2 and a monthly pass will cost riders $103 instead of $81.
In recent years, the once white-hot New York City real estate market helped the MTA balance its budget with dedicated taxes. But the market has gone cold. Dedicated real estate taxes reported this month have come in at $25.2 million, 65% below the budgeted $73.4 million and 68.2% lower than the $79.3 million collected in March 2008.
MTA collects a portion of mortgage recording taxes in the 12 counties it serves and commercial real estate transfer taxes and commercial mortgage recording taxes within New York City. Year-to-date dedicated real estate taxes have come in at $96.7 million compared to $306.3 million at the same time last year.
Petroleum business tax receipts in March also come in lower than budgeted at $44.5 million. That was $8.1 million, or 15.4%, lower than expected.
Chief financial officer Gary Dellaverson called the tax revenue numbers "sobering" and said the authority may not wait until its scheduled mid-year budget revision in July to revisit the budget.
Fewer drivers using bridges and paying tolls and fewer passengers on subways and commuter rail in February depressed toll and fare collections by 0.6%. At $393.5 million, that was $2.4 million less than the budgeted forecast.
The MTA uses several dedicated taxes, subject to appropriation, to back its dedicated tax fund bonds. The weakened economy has reduced expected debt service on those bonds from 7.8 times from 2004 through 2008 to a projected 6.4 times from 2009 through 2012, according to a Fitch Ratings report.
"There's definitely very strong coverage," said Fitch director Chad Lewis. "The coverage is there because the excess cash flow flows back to fund operations."
Fitch rates the bonds A-plus with a stable outlook.
In a sign of how the fiscal difficulties are affecting the MTA's capital budget, the authority said yesterday it plans to cut back on a third track used to relieve congestion at a station on the Second Avenue subway line currently under construction to save a net $65 million.
"This is a real crisis," said vice chairman Andrew Saul. "The MTA is really in a very deep hole and unfortunately I think the hole is getting deeper."
The authority passed an $11.42 billion "doomsday budget" in December that included slashing services and raising fares in order to close a $1.2 billion budget gap.
The fare and toll increases are expected to bring in an additional $670 million in 2009 and $1.15 billion in 2010. But a delay in implementation has given lawmakers time to work on alternate funding sources.
Resistance in the state Senate blocked a proposal that would have created new revenue streams and a new bond issuing authority.
Spokesmen for the Assembly and Senate yesterday said talks are ongoing.