Save the MTA
Transit can’t survive without federal funds
THE New York City region’s transit system is facing its worst crisis since the 1970s. As the recovery begins, reliable and safe public transit must be front and center.
Because of the COVID-19 crisis, ridership has plunged by 93 percent on the subways and even more on the LIRR and Metro-North. For the Metropolitan Transportation Authority, this will result in an estimated $8.5 billion shortfall in 2020 — about half its annual operating budget.
Losses can be expected to grow in 2021. Even after the economy reopens, it is likely to take some time to fully recover. Both ridership and revenues will remain depressed, and these will be far worse if there are subsequent waves of the pandemic, as many epidemiologists predict.
The MTA received nearly $4 billion in emergency relief in the CARES Act and has requested an additional $3.9 billion in the next federal rescue bill to keep it solvent through the rest of 2020.
Without this desperately needed federal revenue, the agency has limited options. Clearly, the MTA needs to accelerate all the efficiency improvements that it can, but these will take time and won’t come close to making up the shortfall.
To bring in more revenue, the MTA can raise fares or borrow more money. It could ask for more from tax revenue, but the state and city have their own fiscal crises.
To cut expenses, it can either reduce service, delay capital projects or default on bond payments. All of these are bad choices at a time when the region faces a deep recession and the future viability of the transit system is at risk.
With ridership so low, raising fares would bring in little revenue in the short term and further delay the return to anything approaching normal passenger volumes.
It would also be an unjust burden to place on the essential, usually low-paid workers who have no choice but to take the subway or bus when their more fortunate fellow New Yorkers can stay at home or take a car.
With the agency’s credit rating dropping, borrowing more money would be costly and exacerbate an already unsustainable level of debt.
Debt payments already account for 16 percent of operating expenses and were projected to rise to 21 percent by 2023 even before the COVID crisis. Further increases could put the authority in a deeper hole. Cutting more service might seem like an appropriate response since ridership has dipped, but the pandemic has created a unique dilemma. It is even more critical to maintain adequate service so that essential and frontline workers have a means to get to work.
And reduced service would hinder physical distancing and make it even harder for the economy to get back up and running.
Some reprioritization of capital projects is inevitable. But any large-scale delay of essential work like track repairs or signal upgrades risks creating a vicious cycle of decay similar to what the transit system experienced in the 1970s, and contributes to job losses.
Defaulting on bond payments is a nonstarter. It would wreck the MTA’s credit and send a terrible signal to the rest of the world. Capital markets would likely shut off access to credit, making the capital program — including essential state-ofgood-repair investments — grind to a halt.
Any deterioration of transit will land hardest on the most vulnerable. The majority of households in New York City don’t own cars, meaning they have to use trains and buses to get to jobs, health care and school.
The path is clear. We need immediate federal support for transit operations to get us through this year and beyond. Even with these funds, the MTA will need to make tough choices on which services are most critical to maintain.
City government could also help by dedicating more street space for buses, for example. And longer term, we need a unified push for a broader infrastructure program that puts people to work. Providing safe and reliable public transit will be a crucial part of a just and fair recovery.
Chris Jones is senior vice president and chief planner, and Kate Slevin the senior vice president of state programs and advocacy, at the Regional Plan Association.