Plenty of news coverage has described the shortfall Governor George Pataki’s recent budget plan represents for the Metropolitan Transportation Authority’s 2005-2009 capital program. The Governor outlined only a $19 billion five year program, in contrast to the nearly $28 billion sought by the MTA.

A new report by NY State Comptroller Alan Hevesi’s office also describes what the Governor’s budget means for MTA annual operating budgets, even with the dramatically scaled-back capital program the Governor’s plan implies. The paper describes extremely troubling scenarios that the agency and its millions of transit-riding customers may face over the next few years. Budget pressures could force the MTA to impose significant service cuts and additional fare increases in the near future, according to the analysis. The Hevesi report says the MTA "is facing its worst crisis since the 1980s."

The report predicts a $181 million annual deficit in 2006 and a $400 million gap in 2007 if Governor Pataki’s budget is approved. If the MTA cannot find significant administrative savings to reduce the shortfalls, then riders may see serious service cuts in 2006, including the elimination of 33 bus routes, elimination of certain LIRR lines and reduction of nighttime bus and subway service, on top of 5% toll and fare hikes in 2007. The report says the MTA is conducting environmental reviews this year to prepare for the possibility that it will have to enact these draconian cuts.

The report predicts that by 2008, the MTA’s annual deficit would total $459, reaching $834 in 2009, and $1.1 billion in 2010.

The problem comes from city and state support not meeting the needs of MTA capital programs and operating budgets over the past decade or so. This, along with increasing health, pension and other costs, has forced the agency to borrow increasing amounts of money to pay for previous and existing capital programs. The report finds that if new revenues sources are not found, over half of the (dramatically reduced) 2005-2009 capital program would have to be paid for with new debt (more than ever before). Debt payments could make up 23% of the MTA’s annual costs by 2015. Debt payments in 2004 were 11.1%. Full report: osc.state.ny.us. 

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