Ravitch Commission Faces Difficult Task of Shoring Up MTA’s Future
The panel headed by former MTA chief Richard Ravitch held its first public hearing yesterday at NYU’s Kimmel Center. Representatives of advocacy groups, local government, think tanks, trade associations, and unions gave the commission a variety of proposals, including but certainly not limited to road pricing, to help the MTA navigate its funding crisis.
Streetsblog observed the afternoon session, which did not yield headline-grabbing ideas like the morning session (a media favorite: selling bridges to the MTA for a dollar and then tolling them) but did provide a good overview of which options the commission is likely to take seriously before making its recommendations in December.
It would be an exaggeration to say that a consensus emerged from the testimony. (The one thing everyone could agree on was that the collective well-being of the city and the region depends on the MTA.) However, several themes surfaced repeatedly over the course of the afternoon. Here’s a brief rundown:
Responsibility for adequately funding the MTA should fall on those who benefit from its services. This encompasses a fairly broad swath of people, including straphangers, the real estate industry, and car commuters (who get less traffic on the street when more people use transit). Many of these "stakeholders" already contribute something to the MTA in the form of fares or dedicated taxes, and could be asked to pay higher rates going forward. Several people testified that some form of road pricing or bridge tolling would be an additional stream of revenue consistent with this philosophy.
The MTA needs more consistent and reliable revenue streams. Congestion pricing fits the bill in this regard, too. The need for predictable revenue also led speakers to suggest more broad-based taxes, unlike the targeted taxes mentioned above. (Taxes collected from the real estate industry have proven especially fickle recently.) Kevin Corbett of the Empire State Transportation Alliance recommended both road pricing and a payroll tax, saying that "if you have multiple parties sharing in the pain, it’s easier to do a deal." He added, "Looking at the enormity of the task, we suspect it will be a combination of the various taxes [and] fees."
The city and state have been derelict in their contributions to the MTA, and debt financing has gone too far. These observations tended to go hand in hand. Pointing out that 13 percent of the MTA’s expenses now go toward debt payments, rising to 16.5 percent in the next few years, Bill Henderson of the Permanent Citizens Advisory Committee to the MTA slammed the city and state for not holding up their end of the bargain. "We should not always have to make a periodic visit to the brink of disaster," he told the panel. "The question is not whether debt should ever be used, but what is the level of debt that can reasonably be used without imperiling the agency’s financial well-being."
It is reasonable, even desirable, to institute regular and predictable fare increases, but straphangers are currently shouldering too much of the burden. Henderson noted that, through the farebox, MTA riders fund 55 percent of the agency’s operating costs, the highest share in the nation. (The figure is 44 percent in Chicago and 37 percent in Philadelphia, he said.) While several other participants echoed that number, the Kheel Plan would not have found a welcome reception among them. Corbett appeared to encapsulate the general sentiment when he called for "modest and regularly scheduled [fare increases], not more than once every other year."
The MTA must become more efficient and financially transparent. Many speakers praised the progress Lee Sander has made in streamlining the MTA, and just as many wanted to see further opportunities for efficiency identified. Two speakers, Gene Russianoff of the Straphangers Campaign and City Comptroller Bill Thompson, recommended creating an independent watchdog agency to monitor the MTA’s finances. When Ravitch questioned whether another level of bureaucracy would prove effective, Russianoff implied that it may be a matter of political necessity. "The legislature will come to you and say, ‘How will we know the money is well spent?’," he said. "You should have an answer."
Throughout the proceedings, Ravitch asked pointed questions but rarely betrayed his position on any single idea, giving the impression that he is genuinely open to all suggestions. The one question he posed again and again to those giving testimony was how to prioritize the potential solutions.
"How would you rank the various tax options available?" he asked Corbett. "Which would have the most deleterious effect on the economy, and which the least? No one likes any of them. The reason our task is difficult is that no one likes recommending charging anything to anybody. It’s only when you compare it with the deterioration of the transportation system that you conclude you have to make nasty choices."