New York State Withholding a Fortune in Transit Taxes From MTA

How many ways can New York state raid the MTA piggy bank? Here’s one to keep an eye on.

As the state budget deadlock drags on into its third month, Albany is withholding hundreds of millions of dollars in dedicated transit tax revenue from the MTA. 

The state, which collects transit taxes before distributing the revenue to the MTA, has yet to deliver a quarterly payment originally scheduled for May 10. According to an article published earlier this week in the Bond Buyer (it’s behind a very steep pay wall), $275 million in tax revenue that’s ostensibly dedicated to transit is being withheld.

While the state says it will deliver the funds when a budget is finally passed, the MTA could be forced to take on additional debt in the meantime. That means subway and bus riders will effectively be helping to pick up the tab for the state’s budget mess. It also means transit advocates should keep their attention fixed on Albany to see whether the state eventually replenishes the full $275 million, or steals the dedicated MTA funds like it did in December.

The MTA is not the only public agency feeling the pinch. To keep from going broke, the state has also withheld payments to school districts and threatened to shut down state parks. But the state’s latest MTA money drain has so far escaped public scrutiny, in what might become another case of Albany avoiding any political consequence for making transit riders worse off.

"In the political economy of scapegoating, the MTA is at the top of the charts," said one insider who’s watched electeds perfect the art of blaming the MTA for budget woes inflicted by Albany.

Perhaps the only person in a position to shift that dynamic is Andrew Cuomo, who notes on page 100 of his "New NY Agenda" [PDF] that the MTA is "teetering on the edge of financial collapse." That leaves one huge unanswered question for the prohibitive favorite in the governor’s race: What are you gonna do about it?

ALSO ON STREETSBLOG

Albany Didn’t “Cut” the MTA Budget. They Stole From It.

|
As part of December’s deficit reduction package, Albany lawmakers took dedicated transit tax revenue from MTA operations to fund other parts of the state budget. The $190 million pot of money is known as the state’s 18-B obligation to the MTA. The total MTA operating budget is nearly $12 billion (with a "b"). When the […]

Albany’s Selective Theft of Transit Funding: Only NYC Pays

|
Earlier this month we described how Albany made off with more than 100 million dollars in dedicated transit taxes that should have gone to the MTA, using revenues collected from the New York City region to plug the statewide deficit. So we wondered, what’s happening to the state’s other transit authorities? It turns out that […]

Fare Hike 2010: Your Chance to Prop Up Albany

|
Straphangers, are you ready to subsidize the runaway state budget? By popular demand, here’s an updated graphic depiction of how the state of New York stole dedicated transit tax revenue from the MTA in last year’s deficit reduction package. The $190 million pot of money is known as the state’s 18-B obligation to the MTA. […]

Albany Grabs Another $16.7 Million From MTA

|
Last week, the MTA announced it lost another $16.7 million to an Albany raid [PDF]. Because of lower-than-expected federal assistance for Medicaid, Albany instituted an across-the-board budget sweep of 1.1 percent, cutting state spending and also siphoning off theoretically separate revenue streams dedicated to specific programs and agencies, like the MTA. It’s a reminder that the […]
No matter how bad the service gets, transit riders will always have these USB ports.

Cuomo Breaks Another Promise to Transit Riders

|
Five years ago, Cuomo promised to allocate $320 million annually to the MTA to make up for cutting one of the agency's dedicated revenue streams. At the time, advocates warned that Cuomo wouldn't keep his promise for long. They were right: This year the governor's draft budget calls for a $65 million cut to MTA funding.