John Petro

Cuomo Budget Cuts MTA Operating Funds, Puts a Bandage on Capital Budget

The MTA will have $200 million less to run its trains and buses this year but will have slightly more money for its capital program, according to Governor Cuomo’s executive budget.

The budget would slash $200 million from the pool of tax dollars used to support the MTA’s operations, called MMTOA funds. The state used a similar budget maneuver last year, taking $140 from the transit authority’s dedicated tax revenue. That move resulted in the worst service cuts in memory along with a 17 percent fare hike for 30-day Metrocards.

Transit advocates hope that this year’s cut to the MTA’s operating budget won’t have the same effect. Gene Russianoff of the Straphanger’s Campaign has stated that MTA officials have assured him that there won’t be any service cuts or fare hikes this year. However, there are ways of reducing service without calling it a “service cut,” including less frequent cleanings or allowing bus runs to go unfilled if a driver calls out sick, that the MTA may need to employ.

What Cuomo’s budget takes away with one hand, however, it gives with another. The budget would put an additional $100 million into the MTA’s capital budget—the money used for new rail cars and buses, track and station maintenance, and expansion projects. This money isn’t nearly enough to begin addressing the almost $10 billion hole in the transit authority’s capital budget over the next three years. The $100 million included in the Cuomo budget would be repurposed from economic development funds, a good move since investments in mass transit are generally effective at spurring economic development.

Additionally, the budget raises the possibility of $194 million for the capital budget from 2005 Bond Act funds. It is unclear whether this constitutes new transit funding.

Essentially, Cuomo’s budget transfers money from the operating to the capital budget. Of the $200 million being cut from the operating budget, $165 million will be used to pay down the state’s past borrowing on transportation bonds. The remaining $35 million will go to the state’s general fund.

While it is essential that the governor and legislature find ways to fully fund the MTA’s capital program, which has a nearly $10 billion hole, taking critical funds used to maintain good service is not appropriate. Nor is $100 million, or even $294 million if the Bond Act funds are included, enough to begin plugging the capital budget hole.

The governor has repeatedly insisted that he would not raise taxes or implement new taxes. But without a new source of revenue for the capital program, there will be more pressure placed on the MTA’s operating budget. The MTA can trim its costs only so much before more service cuts or fare hikes are on the way. Some of these service cuts will only be slightly perceptible—dirtier train cars and stations, abandoned bus runs. If this trend of cutting operating funds continues, more severe service cuts will need to be considered.

Cuts like these will make it nearly impossible for the MTA to improve service and to update the region’s mass transit system for the 21st century.

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Posted at 11:44 AM, Feb 01, 2011 in
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