Transit advocates are calling on the MTA to use the unanticipated $330 million revenue windfall the agency recently announced to stop a fare hike in 2005. But the agency says it wants to save most of the money to apply to its looming 2006 budget gap, especially if the revenue picture worsens again.

The funds at issue come from better-than-ex-pected revenues from real estate-related taxes that the MTA gets a piece of.

The agency plans on placing $200 million in a reserve fund, in case future revenue does not meet expectations, or simply to apply to its 2006 operating budget, which could be $600 million or more in the red.

But transit advocates oppose the plan, especially at a time when top NY City and State officials have yet to acknowledge the huge mass transit budget problem that is upon us.

"The MTA’s plan — to roll over the $200 million reserve into 2006 — would be a one-shot that does nothing to address the MTA’s long-term structural deficit. The rollover also smacks of being timed to give maximum help to the Mayor and Governor at a key time in the political calendar," said the Straphangers Campaign’s Neysa Pranger at an MTA board meeting last week.

Using the extra revenue next year would win time for the governor and state legislature to find a way to raise new revenue for the agency without socking riders and motorists with the second hike in three years. The agency faces a skyrocketing annual deficit, potentially reaching $1.6 billion by 2007. It also needs to find at least another $11 billion for its proposed 2005-2009 capital plan.

MTA officials last week seemed determined to raise fares and tolls in 2005. Their hopeful scenario seems to be that if they are able to harbor the $200 million windfall and any other better-than-expected revenue receipts, the smaller 2006 deficit can be more easily handled by potential revenue-raising action by the governor and legislature. Before that can happen, however, Governor Pataki needs to admit that there is a problem. If he doesn’t, the transit system is looking at serial fare increases, service cuts and the reversal of 25 years of progress rebuilding the mass transit infrastructure. 

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