Road Pricing Still the Big Missing Piece in MTA Funding Puzzle

It’s been 20 months since the state legislature passed an MTA funding package with a conspicuous missing piece. In early 2009, the transit agency was reeling from the recession, and straphangers were about to get walloped by deep service cuts and a 23 percent fare hike. Albany responded by enacting just a partial fix: a regional payroll tax and a smattering of new fees on taxis and car rentals. Tolls on the East and Harlem River bridges were supposed to be part of the deal — getting car commuters who benefit from the congestion-busting effect of transit to contribute their fair share. But the State Senate insisted on preserving the free ride for motorists.

At the time, it was no secret that the package was insufficient, leaving the MTA capital program largely unfunded. The news quickly got worse. Revenue from the payroll tax, which was supposed to raise about $1.5 billion per year, kept coming up short. Throw in state raids of dedicated MTA funds, and Albany’s neglect of transit has hit straphangers with the deepest service cuts in a generation and the third consecutive year of fare hikes.

Tom Namako reports in the Post today that the payroll tax shortfall is not a temporary glitch, as State Senators claimed when the problem first cropped up. In fact, every piece of the 2009 funding packing is not meeting projections, and it’s starting to look like a fact of life:

And the latest jostle for commuters is that the wide-ranging “bailout” package of fees and taxes approved in 2009 is coming in about $400 million short of projections that were established earlier this year, statistics show.

The controversial business tax — which hits all business owners in the MTA region with a 34-cent levy for every $100 of payroll — appears to be $321 million under expectations, MTA data show.

Overall, it will bring in about $1.34 billion instead of the $1.66 billion that bean counters projected.

And the “MTA aid” levies — like a 50-cent surcharge on every yellow-cab ride along with car-rental, garage-parking and license fees — are under projections by $60 million, the numbers show.

Road pricing was the missing piece in 2009, and it’s the missing piece today, MTA board member Andrew Albert told the Post:

“The riders have done their part with service cuts and fare hikes, but motorists aren’t doing their part,” fumed Andrew Albert, an MTA board member.

He added that the bailout bill “is not a good package” and that city’s free bridges should be tolled to help finance mass transit.

The state legislature is not thinking about completing the transit funding picture, however. They’re talking about weakening transit funding that’s already in place. As soon as they gained the majority in the State Senate, Dean Skelos’s Republicans immediately made noise about repealing the underperforming payroll tax.

With Albany set to wrestle with a budget gap greater than $9 billion next year, the payroll tax could be an irresistible bargaining chit — the temptation will be strong to give up the payroll tax revenues in suburban counties as part of a larger deal to win the votes of those legislators.

Andrew Cuomo and NYC legislators can’t let that happen. The MTA still has a $9 billion hole in its capital program, and the slightest tremor in its operating budget could set off another round of service cuts or fare hikes. The payroll tax, while not meeting projections, is now a bulwark against utter disaster for straphangers. Trading away any part of it would be a betrayal of New York City transit riders.

  • J:Lai

    bike lane opposition is the tiniest whisper of an objection compared to the resistance facing tolling the bridges.
    This is the big fight in allocating resources between drivers and everyone else in the region, and the driver constituency should be expected to fight by any means to preserve their entitlement.

  • Gary Reilly

    Let’s not forget that drivers too will benefit from road pricing in the form of reduced congestion and aggravation.

    Cashless two-way tolling throughout the NYC region would eliminate inefficiences in collection, reduce congestion, eliminate artificial bottlenecks and reduce travel times for drivers.

    This is a policy that works well for everyone. Yes, opponents will try to characterize this as an unfair transfer from drivers to riders. But in addition to pricing externalities from driving behavior and raising funds for transit, it must be hammered home that drivers are getting value for money when full speed, cashless tolling is implemented.

    There are no losers here.

  • Larry Littlefield

    Just remember that you can’t charge the whole transportation system to drivers and also have less driving. The problem of all “sin” taxes or environmental/resource use taxes.

    Also, don’t forget about freight movement. It also benefits from less crowded streets.

  • Larry, we have to worry about overcharging drivers in America today like we have to worry about spending government surpluses. 🙂 We shouldn’t be troubled by the contradiction of profiting from something we aim to reduce the supply of until we are in the same league of auto taxes and tolls that have nurtured balanced, efficient transportation in most of Europe.

  • Sharon

    “Let’s not forget that drivers too will benefit from road pricing in the form of reduced congestion and aggravation.”

    the only people driving are those who need to drive.

    “This is a policy that works well for everyone. Yes, opponents will try to characterize this as an unfair transfer from drivers to riders. But in addition to pricing externalities from driving behavior and raising funds for transit”

    It is unfair to drivers that the proceeds from said tolls(taxes) just gets funneled into higher and higher pay rates for the way overpaid compared to market level twu salaries. They have grabbed any extra money when it has been introduced. Just refer to the so called mta bailout (tax businesses out of state plan) plan. The money was funneled into 11% raises for the TWU in a time when real inflation was flat and the agency was in the red tens of billions of dollars. The mta takeover of The triborough bridge and tunnel authority funneling tolls into the mta just led to a period of cash and spend on ever increasing salaries.

    Once the 11% twu raises go through we will be paying a person pushing a broom $25 an hour plus $10 benefits. Market rate for unionized porters (who do more) is $16-$18 an hour.

    Leave all the liberal leftist mumble jumble for another blog. The facts of the matter are motorists already PAY THROUGH THE NOSE. Most motorists in the outer boroughs are working class people or middle class people who with all the taxes live not much better then the people under the poverty line and worked much harder to have something for their family. Most of NYC is not Brooklyn Heights or the Upper West Side. They are Sheapshead bay, East New York, Bay Ridge, Midwood. Places where families live and need to drive to pick up a daughter from a school event on a cold night. People who do not have a rite aid or starbucks every 2 blocks. People who do not a zip car lot withing a half hour mass transi trip. People who need to go grocery shopping a half mile or more away.

    There are $2 billion in savings if the Unions contribute there fair share in common sense and fair work rule changes. They have cost riders and taxpayers $5 billion in dragging their feet in the last 10 years. First they must agree to regional bus which will allow the mta to better schedule buses to save tens of millions in unneeded spending. Station agent and maintainer titles need to be broad banded or in lay mens terms reducing the number of titles so that a train cleaner could also clean stations or buses as needed. Why can’t station agents hang service change notices in stations. Currently a second set of workers does this. Revenue people who collect money could drop the notices off and the agents could tape them up. the list goes on and on. THE PUBLIC HAS BEEN HELD HOSTAGE and now you want motorist who have shouldered their fair share and took on more last year . ENOUGH IS ENOUGH.

  • Sharon

    “We shouldn’t be troubled by the contradiction of profiting from something we aim to reduce the supply of until we are in the same league of auto taxes and tolls that have nurtured balanced, efficient transportation in most of Europe.”

    One difference, the layout of many towns in Europe facilitate the “nurtured balance” you speak of. America and most parts of NYC are not laid out for such “balance”.

    “something we aim to reduce the supply ”

    The only people who have this view are those who have enough money to take a cab when mass transit is not fast enough. They are not those who live in places where cars are needed.

    FYI Europe except for Germany is a financial mess. Ireland, Italy, Spain are on the verge of going bankrupt. Germany is thinking of jumping ship and getting out of the Euro . The people of germany have enough of subsidizing the socialist nut cases in southern europe.

    Also europeans are smaller. Personally I drive a honda fit. It is the perfect city car. great fuel economy and great for parking. Not everyone fits in one. People have families. So you are saying go F$#$#@ all the families who do not want to live like a poor person

  • Sharon

    Middle class and working class people are struggling enough under the burden of unfair taxes to support a bloated public workforce. Motorists and all the good paying jobs they support in this city and taxes they pay more then cover the costs of the roads that would be needed anyway for public safety and deliveries.

    Try having three children in two schools and being a working mom. Without a car living in Bensonhurst you can not get through your day. There is not enough hours in the day to get everything done. Come out to where I live on 16th ave and 70th street. Where the nearest bus line is a 14 mile away.

  • Joe R.

    @Sharon,

    As an outer borough ( Flushing, Queens, near Jewel Ave and 164th Street to be specific ) resident, I agree to some extent that there is some Manhattan-centric thought from the other posters. I get by without a car or driver’s license although I know people in the neighborhood for whom a car is essential, or at least if not essential, enables them to get more done. What we really need is a coherent policy to reduce auto use in the places where it causes the most problems without unduly penalizing those who presently need to drive. This is why heavily charging private vehicles to enter Manhattan and possibly the central business areas of the outer boroughs makes some sense. Charge people more to drive when they’re going to places which can easily be reached by alternative means ( and let’s be honest, it’s almost always quicker taking the subway or commuter rail into Manhattan than driving there from most parts of the city anyway ). Let’s NOT penalize people who run errands solely in the less congested parts of the outer boroughs. What we need to recognize here is yes, cars are sometimes necessary, but at the same time they are overused in a city like this with good public transit. We could use some of the funding from tolling entrances into Manhattan to expand public transit in the outer boroughs. Long term the goal should be to make public transit ( and also cycling ) a viable enough way to get around that few city residents would feel the need to own a car. Admittedly, we have a way to go, particularly in the outer boroughs. We can thank Robert Moses and his aversion to public transit for setting us back a good 50 years.

    Another thing which seriously needs to be looked at is somehow charging non-city residents who drive into the city to get to work. These people consitute a significant portion of the auto traffic in both the outer boroughs and Manhattan. Right now they pay nothing for the problems they create. Maybe it’s time to bring back the commuter tax, but perhaps give an exemption if you have proof of using public transit to get to work. Again, the goal should be reducing unnecessary auto use. Many of these people have a park-and-ride rail station within a few minutes of home. Many also instead choose to drive all the way in for whatever reason even though it costs more in terms of time and money than taking the train. I’m not talking here about people who work off-hours when commuter rail hardly runs, but people who illogically choose to drive into Manhattan during rush hours, even though it takes WAY longer than the train and costs more.

    And yes, we need to reign in all these ridiculous union work rules. They’re making mass transit more costly than it needs to be.

  • mike

    “the only people driving are those who need to drive.”

    Except that’s utterly false, particularly when it comes to driving into the CBD during rush hour. There was a whole bunch of research done during the congestion pricing campaign a few years back that shows this is not true.

    Sharon, I sympathize with your frustration, but your perception of things is completely off-base.

  • J:Lai

    Some drivers would benefit from congestion pricing – those who are rich enough to not care much about the fees. Drivers at the margin face either a significant new cost or a switch to a transportation mode they consider inferior.

    It is this marginal driver who represents the major opposition. And while only a minority of drivers are mariginal in economic terms, a majority identify with or consider themselves in this class (eg working families, middle class, etc.)

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