The Metropolitan Transportation Authority (MTA) sits on one of the greatest monopolies in the world, transporting people in and around New York City. When they decide to add a subway station the value of the surrounding real estate skyrockets. It is inconceivable that they could be in dire financial straits but due to decades of mismanagement and corruption they are. As such, they are looking to raise fares and tolls as well as “searching for new sources of revenue” which is their double speak for congestion pricing. As such, the MTA is looking to hammer trucks and small business to supplement their incompetence.
Fare revenue will be approximately $1 billion lower between 2018 and 2022 than what was forecasted in 2017, and dedicated tax revenue will be more than $580 million lower than the 2017 forecast. Paratransit costs are also increasing by $321 million compared to the July forecast. These figures are partially offset by debt service costs that declined by $194 million since July, mostly due to refinancing, and energy costs that declined by $101 million since July due to lower energy costs and a new agreement with the New York Power Authority.
Though the MTA claims to be able to balance its 2019 budget, the out-year budget deficits will hit $510 million in 2020, $816 million in 2021 and $991 million in 2022. Also, by 2022 the MTA’s debt service is expected to reach $3.3 billion and the MTA currently carries $38.6 billion in debt, which is why their bond rating was lowered by S&P. The issue of MTA debt needs to be discussed in further detail. The MTA blew through tens of billions of dollars on the Second Avenue subway, Fulton Center, and Hudson Yards, three grandiose projects that did nothing for the outer-boroughs. That money could have easily paid for the signal upgrades that are so desperately needed. Instead, the MTA is crippled with debt. For comparisons sake Toys R Us had to file for bankruptcy because of $5.2 billion in debt. Sears went bankrupt due to a $5.6 billion hole. The combined debt of Toys R Us and Sears is ONLY a third of the MTA’s debt and worse they are looking to add more.
There is a plan to create a ring around the central Manhattan core and charge all vehicles who enter. Under the most recent proposal trucks would be hit with a $25 fee. This is known as congestion pricing but that is not what it is, it is a debt scheme. The tolled revenue will be used to secure almost $12 billion in new debt while creating more unelected, unaccountable levels of bureaucracy. About 30% of tolling revenue goes to create, maintain, and collect the system. As such the MTA will always be playing catchup and tolls will have to be raised frequently, which will cripple commerce. Below are two toll increase proposals on trucks for 2019.
For their part the MTA is trying to convince New Yorkers to hand over more money because they claim they will be responsible this time around. They’ve created both a “Cost Containment” and “Procurement Reform” Task Force. Because at the MTA reform means let the inmates run the asylum.
The MTA will have public hearings to discuss the various fare and toll increases, small business owners and those in trucking must make their voices heard.