Skip to Content
Streetsblog New York City home
Streetsblog New York City home
Log In
State Legislature

Budget Deal Prevents MTA Collapse, But Keeps Fuse Lit on Debt Bomb

Because Albany decided not to pay for the rest of the MTA's capital plan, the amount of debt that transit riders must carry is just going to keep growing. Image: Office of the State Comptroller.

The MTA doesn't face an immediate crisis thanks to the budget deal struck by Albany's leadership yesterday. But with the deal continuing to rely on debt to pay for the next three years of repairs and expansions, it doesn't put the region's transit system on firm financial footing either.

Earlier this month, Senate Republicans issued a major threat to the MTA. Their one-house budget proposal would have cut the $770 million in capital funding budgeted by the Cuomo administration, and would have clamped down on the agency's bonding cap, preventing it from borrowing more money.

The proposal was widely seen as setting up a bargaining position, most likely to help upstate legislators win still more state support for their roads and highways, but had it passed, it would have devastated the transit system. With neither the state support to pay for construction now nor state permission to pay for it later, everything from routine track repairs and new train cars to mega-projects like East Side Access and the Second Avenue Subway would have been in jeopardy.

As of yesterday, the small possibility of that devastating outcome has been eliminated. The rest of the MTA's current capital program, $13 billion of spending over the next three years, will move forward. "This gives the go ahead to vital projects that mean reliable service, such as bus and subway car purchases, subway station fix-ups and track and signal overhauls," said the Straphangers Campaign's Gene Russianoff, who applauded the arrangement.

That doesn't mean, however, that MTA finances look any better than they did in January. Yesterday's agreement simply preserves the status quo for the capital plan. The bonding cap increase will allow the MTA to borrow up to $41.9 billion dollars even as debt service makes up the fastest-growing piece of the MTA budget. The debt increase would be the second for a single five-year capital program, which is unprecedented in recent years.

Those ebullient statements that paint the deal as setting up a rosy future for transit are far out of line. "This represents the greatest commitment to the MTA from a governor in recent memory," said a completely unidentified source in the Daily News. But the commitment extends only to spending, not revenue. If the two aren't brought into line, the MTA will be forced to raise fares even beyond its planned biennial hikes.

Said Russianoff, "The challenging news is that the MTA will have to receive new revenues in years to come to meet the ongoing needs of its riders, as MTA Chairman Joseph Lhota has said."

Transportation Alternatives Executive Director Paul Steely White blasted the deal for not providing those revenues now, and for sticking future transit users with the bill. "Today’s plan doubles down on the state’s dangerous commitment to funding transit through debt," he said. "Governor Cuomo and the state legislature must invest in transit through secure and sustainable sources of revenue."

Monday's deal means that Albany won't torpedo the MTA. Completing the capital plan is necessary for the basic health of the region's transit service; even paying for it on the straphangers' credit card is preferable to letting the system collapse. But that unattractive choice should underscore the need for sustainable and sufficient MTA funding options. There's no way to get out of paying for your transit system.

Stay in touch

Sign up for our free newsletter

More from Streetsblog New York City

Friday’s Headlines: Hochul’s Fantasy World Edition

The governor has gone off the deep end. Plus other news.

July 19, 2024

Speaker Adams: Council May Not Use its ‘Sammy’s Law’ Power to Lower Speed Limits

The Council may not lower the speed limit, even though it fought so hard to get that very right from the state legislature.

July 19, 2024

Parks Dept. Has Money But No Timeline to Finish Eastern Queens Greenway

There's tens of millions of dollars for the greenway, so when will parks build it?

July 19, 2024

Thursday’s Headlines: Paris is a Lot Cooler than NYC Edition

The City of Light has figured out how to reduce the heat island effect. Plus other news in today's daily digest.

July 18, 2024

Exclusive: Legal Team Announced for Suit Against Hochul’s Congestion Pricing ‘Pause’

Attorneys from three firms have inked a joint defense agreement to fight "the governor’s illegal decision to cancel congestion pricing," Comptroller Brad Lander said.

July 17, 2024
See all posts