New York's Metropolitan Transportation Authority yesterday asked the state, city, and subway and commuter train riders to pony up more money to help the agencyy close a budget gap that would rise to $903 million in 2009.
The MTA's finances have taken a double hit from a weak economy and rising fuel costs, executive director and chief operating officer Elliot Sander said yesterday during a presentation on the preliminary 2009 budget and 2009 to 2012 financial plan.
Dedicated real estate tax revenues in 2008 and 2009 are now expected to be $443 million below forecast while fuel and energy costs are expected to be $208 million above forecast. Other dedicated state taxes are now expected to come in $60 million below forecast.
In a move that is opposed by Gov. David Paterson, the MTA proposed accelerating a fare and toll increase scheduled for 2010 to take effect next July and to increase the yield of the increase to 8% from 5%. The authority would also move up a 5% fare increase scheduled for 2012 to 2011.
The increase was unpopular with a number of board members as well who said the authority should do more to find savings and other revenue sources before asking commuters to bear a fare and toll increase so soon after the MTA implemented an increase this year yielding 3.85%.
"Before we ask the riding public to take an 8% fare gain, which is a substantial amount for hard working people, I think we need to redouble our efforts to find every nickel, every quarter in expense reductions," said finance committee chairman Andrew Saul.
The preliminary budget calls for about $300 million of additional state and city contributions which includes full reimbursement by the city and state to pay for reduced fares for students and seniors which costs the authority $104 million annually.
The MTA's agencies would reduce costs by 6% over four years without cutting service for a savings of $212 million in 2008 and 2009.
Another gap-closing measure would be for the authority to borrow $135 million in 2009 and 2010 from an other post-employment benefits fund set up to prepare for future OPEB liabilities. The MTA would repay the loan in 2011 and 2012.
Another rising cost the MTA faces is debt service which will rise from $1.51 billion in 2008 to $2.02 billion by 2012. As a percentage of fare and toll revenue, debt service will rise from 27% in 2008 to 37% in 2012.
The MTA board will vote on the budget in December.
Also yesterday, the board approved an amendment to its 2005-2009 capital program that would defer some $2.7 billion of projects. Although at $23.72 billion, the amendment increased the current capital plan by $1.13 billion, most of that increase is due to increased federal funding for the Second Avenue subway line and the East Side Access project. Construction cost escalation has driven up the price tag on other projects.