The Metropolitan Transportation Authority provides essential subway, bus, and commuter rail services to millions of New Yorkers, requiring complex financial management and ongoing infrastructure investment. This page covers CBC’s work on MTA capital planning, structural operating budget deficits, fare and toll evasion, labor productivity and work rules, and transit affordability programs.
This page was created with AICBC Insights uses AI to group, analyze and present data and recommendations from CBC's publications. Always reference the cited sources to verify important details..
The City should raise the Fair Fares NYC eligibility threshold to 250 percent of the FPL to better serve low-income residents.
The City should improve low uptake and utilization of Fair Fares NYC through expanded education, outreach, and enrollment strategies.
The City should leverage proven strategies, such as signal priority and physically separated busways, to make the City’s streets more conducive to faster bus traffic.
The City should work with the MTA to further improve bus speeds through operational and infrastructure changes.
Refine and continue a multi-faceted approach to reducing fare and toll evasion, including improving enforcement, educating riders on the importance of fare payment, and better securing the transit system environment.
Accelerate the rollout of new faregates funded in the 2025 to 2029 Capital Plan.
Accelerate the rollout of proof-of-payment to allow EAGLE Team inspectors to enforce fare payment on local and express buses without having to directly witness fare evasion.
Publish comprehensive and regular data on fare and toll evasion.
Work with the City to assess the cost-effectiveness of deploying police officers to enforce fare payment.
Work with the City to assess the effectiveness of the Fair Fares Program and consider expansion.
Key Data
In May 2026, the CBC reported that Fair Fares NYC enrolled nearly 400,000 New Yorkers (31% of the 1.23 million eligible), costing $86 million in fiscal year 2025. The analysis also noted that NYC's buses average 7.0 miles per hour, which is 29.3% slower than the 9.9 miles per hour average of other major US systems.
A September 2025 report estimated that fare and toll evasion cost the MTA approximately $1 billion in 2024, including $568 million in unpaid bus fares and $350 million in unpaid subway fares. To combat this, physical turnstile modifications like fins and sleeves led to a 60% decrease in turnstile jumping where deployed.
In August 2025, watchdogs highlighted that implementing One Person Train Operation (OPTO) systemwide could save the MTA $442 million annually. Conversely, prohibiting OPTO on the A, G, M, 5, and shuttle lines would cost the agency up to $10 million annually.
A March 2025 analysis of the MTA's capital program revealed that the proposed 2025-2029 Capital Plan of $68.4 billion had only $35 billion in identified funding, leaving a $33.4 billion gap. This gap grew to $35.4 billion under the State Fiscal Year 2026 Executive Budget, which reduced city and state contributions by $1 billion each.
In September 2024, the CBC warned that the MTA's structural budget gap is projected to exceed $1 billion by 2027. Funding this gap with $10 billion in new MTA bonds is considered fiscally unsustainable because it would further widen the operating deficit.
John (“Janno”) Lieber was confirmed as Chair and CEO of the Metropolitan Transportation Authority (MTA) in January 2022, following his nomination by Gov. Kathy Hochul. Lieber has been serving as MTA Acting Chair and CEO since July 2021 and is the Authority’s 15th Chairperson since it was founded in 1968.…
Expanding the Fair Fares NYC program to individuals earning up to 250 percent of the federal poverty level would provide affordable transit to an additional 722,000 residents at a projected annual cost of $146 million. Rather than implementing costly fare-free bus policies that exceed $900 million annually and fail to improve transit speeds, the city should focus on targeted affordability programs and operational improvements like signal priority and dedicated busways.
Recommendations related to MTA Reforms
The City should raise the Fair Fares NYC eligibility threshold to 250 percent of the FPL to better serve low-income residents.
The City should improve low uptake and utilization of Fair Fares NYC through expanded education, outreach, and enrollment strategies.
The City should leverage proven strategies, such as signal priority and physically separated busways, to make the City’s streets more conducive to faster bus traffic.
The City should work with the MTA to further improve bus speeds through operational and infrastructure changes.
Key Data
$900 million
— The estimated annual cost to the City to replace MTA bus fare revenues if buses were made fare-free.
$146 million
— The projected annual cost to the City to expand Fair Fares NYC eligibility to 250 percent of the federal poverty level.
722,000
— The number of additional New Yorkers who would become eligible for Fair Fares NYC if the eligibility threshold were raised to 250 percent of the federal poverty level.
7.0 miles per hour
— The average speed of New York City buses, which is significantly slower than the national average.
29.3 percent
— The amount by which New York City bus speeds are slower than the 9.9 miles per hour average among other major bus systems in the U.S.
31 percent
— The current enrollment rate of the 1.23 million New Yorkers eligible for the Fair Fares NYC program.
Proposed legislation restricting the MTA's use of one-person train operations threatens to block modern staffing efficiencies and risk squandering over $10 billion in subway signal modernization investments. Opposing these bills would allow the transit system to adopt global best practices, where fewer than 6% of international rail lines require multiple operators.
Recommendations related to MTA Reforms
Legislative leaders should oppose S9586 and A10706, which would restrict the MTA’s use of one-person train operation (OTPO), the industry standard for subway systems in the U.S. and internationally.
The MTA should be able to follow facts and implement national and international best practices for staffing and technology investments.
Legislative leaders should focus their efforts on forward-looking investments, not policies micromanaging subway staffing and operations.
Key Data
less than 6%
— of 400 rail lines around the world use two or more train operators.
94%
— of 400 rail lines around the world use one or fewer operators, with many completely automated.
1996
— is the year since which the MTA has safely and successfully operated one-person subway trains on shuttles and at off-peak hours.
$5.4 billion
— is allocated in the 2025-29 capital program to modernize subway signals.
$5.0 billion
— was allocated in the 2020-24 program to modernize subway signals.
Fare and toll evasion cost the Metropolitan Transportation Authority approximately $1 billion in 2024, draining resources needed to maintain the system and shifting costs to other riders and taxpayers. To address this, the agency should continue its multi-faceted enforcement approach, accelerate the installation of new faregates, and improve data transparency regarding evasion rates and the effectiveness of interventions.
Recommendations related to MTA Reforms
Refine and continue a multi-faceted approach to reducing fare and toll evasion, including improving enforcement, educating riders on the importance of fare payment, and better securing the transit system environment.
Accelerate the rollout of new faregates funded in the 2025 to 2029 Capital Plan.
Accelerate the rollout of proof-of-payment to allow EAGLE Team inspectors to enforce fare payment on local and express buses without having to directly witness fare evasion.
Publish comprehensive and regular data on fare and toll evasion.
Work with the City to assess the cost-effectiveness of deploying police officers to enforce fare payment.
Work with the City to assess the effectiveness of the Fair Fares Program and consider expansion.
Key Data
$1 billion
— Estimated cost of fare and toll evasion in 2024.
$800 million
— Structural operating budget gap the MTA faces.
44 percent
— Bus fare evasion rate in the first quarter of 2025.
330
— Number of subway fares evaded every minute during 2024.
710
— Number of bus fares evaded every minute during 2024.
36 percent
— Decrease in fare evasion at locations where unarmed gate guards were utilized.
Prohibiting one-person train operation (OPTO) would cost the MTA $10 million annually and prevent potential savings of $442 million, while hindering the agency's ability to modernize and improve service. By mandating the presence of conductors on all trains, the proposed legislation restricts management's operational flexibility and ignores the global standard of using OPTO to provide efficient, cost-effective transit.
Recommendations related to MTA Reforms
The Governor should veto A4873/S4091, which would prohibit the Metropolitan Transportation Authority from using one-person train operation.
State officials should leave operational strategies and decisions to management as the best, most flexible path to high quality service at the lowest cost.
State laws should focus on ensuring agencies are high performing and transparent, and that management is accountable.
Key Data
$442 million
— The estimated annual savings from using one-person train operation systemwide, which could be reinvested to close the MTA’s structural operating budget gap or improve service.
$10 million
— The estimated annual cost to the MTA if it were forced to cease using one-person train operation on the A, G, M, 5, and all shuttle services.
The Metropolitan Transportation Authority faces a $33.4 billion funding gap in its 2025-2029 Capital Plan, requiring a balanced approach that includes increased state and city contributions, modest fare and toll hikes, and operational efficiencies. To ensure fiscal stability and project delivery, the state must prioritize "rebuild and improve" projects while implementing accountability measures like improved project reporting and labor flexibility.
Recommendations related to MTA Reforms
Focus the Capital Plan exclusively on Rebuild and Improve projects to shrink the funding gap.
Increase the City and State contribution by $9.0 billion in pay-as-you-go (PAYGO) financing to support the capital plan.
Modestly increase fares, tolls, and vehicle registration fees to generate revenue to support a $6.8 billion investment.
Require the MTA to publish project plans, user-friendly capital project status reports, and regular updates on asset repair status.
Ensure labor provides the flexibility to generate at least $500 million in recurring operating budget savings to support debt obligations.
Require a study to identify any State or City laws or regulations that increase MTA capital costs.
Include provisions to provide tools to the District Attorneys, police, and the MTA to dramatically turn the tide on fare evasion.
Key Data
$68.4 billion
— Size of the 2025-2029 Capital Plan.
$33.4 billion
— The funding gap in the 2025-2029 Capital Plan.
$35.4 billion
— The financing gap following the State Fiscal Year 2026 Executive Budget.
$14.0 billion
— The MTA's expected federal aid to the capital plan.
$3.6 billion
— Funding gap reduction achieved by removing expansion projects.
$9.0 billion
— Proposed increase in City and State contribution via PAYGO financing.
The MTA's proposed $69 billion five-year capital plan faces a significant funding gap, exacerbated by the pause on congestion pricing and the inclusion of non-essential expansion projects. To ensure the system's reliability and financial stability, state leaders must prioritize essential repairs, unpause congestion pricing, and empower the agency to improve operational efficiency and reduce fare evasion.
Recommendations related to MTA Reforms
One-third of the funding gap is congestion pricing; it should be unpaused.
Albany also should trim and hyper-focus the plan.
Focusing exclusively on rebuilding and improving would direct billions more to ensuring the system doesn’t increasingly break down.
The MTA should reduce fare evasion and increase efficiency to stabilize its operating budget and finance debt.
State leaders should support a tightly focused and smartly financed MTA capital plan and empower the MTA to reduce fare evasion and increase efficiency.
Key Data
$69 billion
— Proposed 5-year capital plan for the MTA.
$15 billion
— Funding hole created by pausing congestion pricing.
$90 billion
— MTA’s 5-year commitment goal.
$1 billion
— MTA structural budget gap.
39%
— Portion of transit station ventilation systems in poor and marginal condition.
Karen Keogh serves as Secretary to the Governor of New York, the highest-ranking appointed position in state government. Kathryn Garcia serves as Director of State Operations and Infrastructure, where she oversees over 70 state agencies and authorities, including the MTA and Port Authority.
The MTA's proposed 2025-2029 capital plan focuses on essential system repairs, but faces significant financing challenges and relies on an ambitious investment pace that may exceed capacity. To ensure fiscal stability and necessary infrastructure improvements, the state must unpause congestion pricing, prioritize core repairs, and implement efficiency measures like reducing fare evasion.
Recommendations related to MTA Reforms
The State should unpause congestion pricing and then identify a funding plan that is sustainable in the long run, ensures those who benefit pay their share, and does not harm New York’s competitiveness.
Critical state of repair projects should be front-loaded, or they may not be committed in the plan period given the extremely ambitious proposed pace of investment.
To fund more capital investment and stabilize the operating budget, the MTA will have to reduce fare evasion, and the labor unions should agree to operating changes that increase efficiency.
Key Data
$68 billion
— The total investment proposed for the MTA 2025-2029 Capital Program.
$96 billion
— The total investment amount when previously planned but not yet committed projects are included.
90 percent
— The portion of the proposed Capital Program focused on projects that rebuild and improve the system.
$8.6 billion
— The amount in proposed and previously planned expansion projects that diverts resources from essential rebuilding efforts.
$10 billion
— The amount of new MTA bonds proposed, which is deemed not fiscally sustainable.
$1 billion
— The MTA's projected structural budget gap by 2027.
The Metropolitan Transportation Authority faces a long-term structural budget gap exceeding $900 million annually, necessitating operational reforms to ensure financial stability beyond the current five-year plan. To address these deficits, the agency must implement one-person train operations, align maintenance costs with peer benchmarks, and negotiate flexible work rules with labor unions to better match service with evolving rider needs.
Recommendations related to MTA Reforms
The MTA should implement one-person train operation (OPTO) on subways and proof of payment on commuter rail to increase efficiency.
The MTA should reduce maintenance and operating costs by targeting peer benchmark levels to ensure operations are efficient and cost-effective.
The MTA should negotiate work rule changes with labor unions to allow the MTA to adjust schedules and services to meet shifting rider needs.
Key Data
$2.6 billion
— The MTA's budget gap for 2023, driven by declining ridership, skipped fare increases, and fare evasion.
$900 million
— The projected annual budget gap the MTA will face in 2029 once federal COVID-related aid is exhausted.
$1.6 billion
— The estimated potential annual savings from meeting benchmark maintenance and operations levels.
$442 million
— The estimated annual savings from expanding one-person train operation (OPTO) systemwide.
$300 million
— The estimated annual savings from reducing commuter rail costs by verifying fare payment at turnstiles or with proof of payment systems.
$330 million
— The annual cost by which the Transport Workers Union (TWU) Local 100 collective bargaining agreement exceeds budgeted raises.
The Metropolitan Transportation Authority faces significant financial and operational challenges, requiring labor unions to collaborate on modernizing work rules, shift scheduling, and health care benefits to ensure long-term stability. Implementing efficiencies like expanding One Person Train Operation and improving employee attendance could save hundreds of millions of dollars while addressing the 50 million customer trips canceled in 2022 due to crew shortages.
Recommendations related to MTA Reforms
Transit workers need to return to pre-COVID attendance levels to improve service and reduce crew shortages.
The MTA should expand One Person Train Operation (OPTO) to modernize operations and utilize capital investments in automatic train control.
The MTA and labor unions should modernize the shift-picking process by replacing the current in-person, on-paper system with an online platform.
The MTA and TWU should switch retirees to a high quality Medicare Advantage plan to restrain ballooning health care costs.
The MTA and labor partners should implement more creative and flexible work assignments and scheduling to improve service and adapt to changing ridership needs.
Key Data
50 million
— Subway and bus customer trips canceled in 2022 due to crew shortages.
19
— Average number of days worked annually lost by subway and bus workers over the last two decades.
$400 million
— Savings targeted by the MTA through increasing its own productivity.
$1.1 billion
— Increase in the Payroll Mobility Tax on New York City businesses to narrow future budget gaps.
$165 million
— Increase in city support of paratransit.
$1 billion
— Revenue from congestion pricing to support infrastructure investments.
Kathryn Garcia serves as Director of State Operations and Infrastructure, where she oversees over 70 state agencies and authorities, including the MTA and Port Authority. Kathryn has over 14 years of government experience delivering services that New Yorkers rely on every day. Previously, she served as the Commissioner of the…
The Metropolitan Transportation Authority's financial stabilization plan relies too heavily on New York City taxpayers and lacks necessary labor-related productivity improvements and recurring state funding. To ensure long-term fiscal health, the plan should incorporate operational reforms, redistribute the financial burden across the region, and reinstate regular biennial fare increases.
Recommendations related to MTA Reforms
Productivity improvements, including changes in MTA operations that require agreement from labor, should constitute at least half of the gap-closing plan.
The State should include a recurring State contribution to the stabilization plan, supported by redistributing existing resources.
The balance of the financial plan should be appropriately allocated among those in the MTA region rather than placing a disproportionate burden on New York City.
The MTA should resume regular biennial fare increases to maintain price sufficiency and fiscal stability.
Key Data
$2.9 billion
— Potential annual savings identified from operational reforms.
$800 million
— Annual revenue generated from increasing the Payroll Mobility Tax top rate from 0.34% to 0.50%.
$640 million
— Estimated portion of the $800 million Payroll Mobility Tax increase likely to come from New York City businesses.
$500 million
— Annual payment required from New York City's operating budget for certain MTA expenses.
$400 million
— Current plan for annual operational efficiencies.
The Metropolitan Transportation Authority faces a $2.5 billion annual structural operating budget deficit and is seeking $600 million in aid to balance its 2023 budget. Stabilizing the agency's operating budget requires a greater reliance on efficiency savings rather than just new revenue sources.
Recommendations related to MTA Reforms
Stabilizing the MTA’s operating budget should rely significantly more on efficiency savings.
Key Data
$2.5 billion
— Annual structural operating budget deficit for the Metropolitan Transportation Authority.
$600 million
— Aid the Metropolitan Transportation Authority is seeking to balance its 2023 budget.
The Metropolitan Transportation Authority faces a structural operating deficit of at least $2.5 billion annually, necessitating significant efficiency reforms and capital investment to maintain service levels. To ensure long-term viability, the agency must prioritize state-of-good-repair projects over expansions, implement congestion pricing, and negotiate labor contract changes to align costs with industry benchmarks.
Recommendations related to MTA Reforms
The MTA should increase efficiency by adopting operating strategies common to other public transit systems and aligning costs with industry benchmarks.
The MTA's leadership and labor unions should work together to identify and phase in efficiency reforms through changes to labor contracts.
The MTA should keep laser-focused on increasing its capital project throughput and use techniques such as Fastrack closures to facilitate repairs and upgrades.
The MTA should prioritize the state of good repair before expansion projects.
Congestion pricing should be implemented expeditiously, and revenues should not be diverted to narrow the operating budget gap.
Key Data
$2.5 billion
— Recurring annual expenses that exceed revenues, creating a structural operating budget deficit.
$750 million
— Prepandemic structural deficit of the MTA.
$35 billion
— Capital investment needed in the next few years to bring tracks, cars, and signals to a state of good repair.
$100 million
— Amount of the MTA's current efficiency plan, which would close just 4% of its gap.
44%
— Amount by which the productivity of New York City Transit subway facility maintenance work is lower than the national median.
$25 billion
— Amount of planned projects that will remain outstanding at the end of 2024 despite recent success in capital contracting.
The Metropolitan Transportation Authority faces a recurring annual structural deficit of approximately $2.5 billion, exacerbated by declining ridership and potential economic risks that could further increase annual deficits by up to $1 billion. To achieve fiscal stability, the agency must implement efficiency-focused operating reforms and restructure its long-term debt while balancing its budget through planned fare increases and potential new state revenue sources.
Recommendations related to MTA Reforms
The MTA should seize the opportunity and runway created by federal aid to implement efficiency-focused operating reforms.
The MTA should restructure its long-term debt to reduce its structural deficit before the region’s critical transit system risks falling off the fiscal cliff.
The organization supports a multi-year phase-in plan starting with efficiencies under the purview of management, followed by implementing changes collectively bargained with labor over time.
Key Data
$2.5 billion
— The MTA's projected annual recurring structural deficit.
$7.0 billion
— The amount of American Rescue Plan Act (ARPA) federal stimulus funds proposed to cover deficits through 2024.
$3.9 billion
— The projected savings from 2024 through 2028 if the MTA uses federal aid to restructure and defease long-term debt.
33 percent
— The share of operating expenses covered by farebox revenue in September 2022, down from 51 percent in 2019.
$1 billion
— The potential annual reduction in tax revenues if the economy slides into a recession.
$2.9 billion
— The amount borrowed from the Federal Reserve Board’s Municipal Liquidity Facility during the pandemic.
The Metropolitan Transportation Authority faces an annual structural deficit of at least $2.0 billion, which is currently being covered by federal aid and borrowing. To stabilize finances and avoid future service cuts or tax hikes, the agency should implement operational efficiencies and maintain planned fare increases.
Recommendations related to MTA Reforms
The MTA should continue planned fare increases, which would be coupled with the City’s increased funding for Fair Fares to stabilize the MTA’s finances.
The MTA should implement changes that increase the efficiency of its operations to address the structural deficit.
The MTA should pursue initiatives that require labor participation, such as facility maintenance improvements or one-person train operation, to improve operational efficiency.
The MTA should restructure operations and preserve the fare policy to stave off possible future service cuts or dramatic tax or fare increases.
Key Data
$2.0 billion
— Annual structural deficit faced by the MTA.
$11.9 billion
— Total federal aid and borrowing used to cover the structural deficit from 2021 to 2025.
$1.6 billion
— Amount provided by selected re-estimates over the plan period.
$321 million
— Amount by which MTA operating expenses ended 2021 below plan.
$2.9 billion
— Amount borrowed from the Municipal Liquidity Facility (MLF) to support operations.
4%
— Target yield for the planned 2023 fare increase.
The Metropolitan Transportation Authority faces a structural budget imbalance exceeding $2 billion annually that will emerge once federal aid is exhausted. To ensure future stability, the state should prioritize operational efficiencies, implement congestion pricing to support capital investment, and continue biennial fare and toll increases.
Recommendations related to MTA Reforms
The Governor should vigorously support the MTA to improve the efficiency of its operations, including working with the leaders of its unionized workforce, to stave off future service cuts, tax increases, or extraordinary fare increases.
The MTA can save up to $2.9 billion annually by increasing subway and bus operations and maintenance productivity, increasing bus speeds, reforming how it deploys conductors, and reducing employee and retiree health spending.
The State should encourage the MTA to continue the practice of increasing fares and tolls biennially to keep up with inflation.
The State should expeditiously implement congestion pricing to generate net annual contributions for the MTA capital plan.
The City should aggressively roll out its discounted Fair Fares program to support transit affordability.
Key Data
$2 billion
— The MTA operating budget has a structural imbalance exceeding this amount annually that will emerge when federal aid runs out.
$2.9 billion
— The MTA can save up to this amount annually by increasing subway and bus operations and maintenance productivity and reforming operations.
$1 billion
— The congestion pricing program is expected to generate this amount in net annual contributions for the MTA capital plan.
$15 billion
— The net annual contributions from congestion pricing would support this amount in investment.
The Metropolitan Transportation Authority faces a structural annual deficit of at least $2.0 billion, which is currently being managed through federal aid and borrowing. To ensure future stability, the agency needs to improve operational efficiency and proceed with planned fare increases while the city expands the Fair Fares program.
Recommendations related to MTA Reforms
The MTA should use this runway to implement changes that increase the efficiency of its operations.
The MTA should continue planned fare increases.
The City should aggressively roll out Fair Fares.
Key Data
$2.0 billion
— The MTA faces a structural annual deficit of at least this amount.
$2.9 billion
— The amount of MLF debt that will support operations through 2025.
$9.8 billion
— The portion of the 2020-2024 capital plan funding that was considered 'at risk' in the summer.
$618 Million
— The total 2021-2025 savings identified for the Transformation Plan.
$819 Million
— The total 2021-2025 revenue expected from the November 2021 fare increase.
$632 Million
— The total 2021-2025 savings from service reductions.
The MTA Open Data Act would require the transit authority to designate a data coordinator and establish a three-year schedule for releasing open data to improve transparency. Currently, the agency has only published 76 datasets, significantly fewer than other state departments, despite managing an $18 billion operating budget.
Recommendations related to MTA Reforms
Governor Hochul should sign A1442B (Carroll)/S4625A (Comrie), the MTA Open Data Act, into law.
The MTA must designate a data coordinator to oversee compliance with open data requirements.
The MTA must create a schedule for release of open data in the next three years, which is provided to the Legislature and the public.
Key Data
$18 Billion
— The MTA's annual operating budget.
76
— Number of datasets the MTA has published on the state's open data portal.
563
— Number of datasets the NYS Department of Health has published on the state's open data portal.
180 days
— Timeframe within which the MTA must create a schedule for the release of open data.
The Metropolitan Transportation Authority faces a $2.7 billion annual structural deficit that requires immediate operational reforms, including productivity improvements, conductor deployment changes, and health care spending reductions to achieve up to $2.9 billion in annual savings by 2024. Without these measures, the system risks severe financial instability, necessitating either a 28 percent increase in fares and tolls or service cuts 50 percent greater than mid-pandemic projections.
Recommendations related to MTA Reforms
The MTA must implement a two-year wage freeze starting next year.
The MTA must implement service cuts starting in 2023.
The MTA must implement the regularly scheduled 2021 and 2023 fare increases, intended to keep up with inflation of costs.
The MTA should continue the smart practice of increasing fares and tolls biennially to keep up with inflation.
The City should undertake robust efforts to promote its Fair Fares program, which provides half-price transit service to lower income residents.
The MTA should increase its subway and bus operations and maintenance productivity, which could save $1.6 billion.
The MTA should focus on increasing bus speeds, which could save $268 million.
The MTA should reform how it deploys conductors, including one person train operation (OPTO) on subways and fare payment modernization on commuter rail, which could save $512 million.
The MTA should focus on reducing employee and retiree health care spending, which could save $663 million.
Key Data
$2.7 billion
— The MTA's annual long-term structural deficit, where recurring expenditures exceed recurring income.
$2.9 billion
— The total amount of annual savings the MTA could realize by 2024 through identified reforms.
$1.6 billion
— Potential annual savings from increasing subway and bus operations and maintenance productivity.
$268 million
— Potential annual savings from increasing bus speeds.
$512 million
— Potential annual savings from reforming conductor deployment and modernizing fare payment.
$663 million
— Potential annual savings from reducing employee and retiree health care spending.
The Metropolitan Transportation Authority faces a long-term structural fiscal imbalance exceeding $2 billion, necessitating significant operational reforms to avoid massive fare increases or service cuts. By improving productivity in maintenance, bus operations, and conductor staffing, and aligning health care contributions with state standards, the agency could achieve nearly $2.9 billion in annual savings by 2024.
Recommendations related to MTA Reforms
The MTA should increase subway facility maintenance productivity to the national peer median to save $981 million annually by 2024.
The agency should implement one-person train operation (OPTO) on subways to reduce the need for conductors and align operations with national peer systems.
The MTA should modernize commuter rail fare collection by adopting proof-of-payment systems to reduce the conductor workforce.
The MTA should increase bus speeds by 15 percent to reduce the number of buses needed and lower operating costs.
The MTA should align retiree health care premium contributions with the current cost-sharing agreement for retired New York State employees.
The MTA should increase active employee health insurance premium contributions to match the 18 percent level paid by non-represented employees.
The MTA should implement a value-based health plan redesign to achieve savings of approximately 12 percent of projected health spending.
The MTA should align LIRR work rules and operating practices with Metro-North Railroad to lower operating and maintenance costs.
Key Data
$2.9 billion
— Total annual savings from implementing the proposed reforms by 2024.
$2.4 billion
— The MTA's projected shortfall in 2024.
13,000
— The number of full-time positions the proposed reforms would reduce by 2024.
$981 million
— Annual savings from subway facility maintenance improvements by 2024.
$512 million
— Annual savings from conductor operating reforms by 2024.
$268 million
— Annual savings from a 15 percent increase in local bus speeds by 2024.
The Metropolitan Transportation Authority faces a $15.9 billion budget gap through 2024, necessitating a combination of service adjustments, efficiency improvements, and potential fare and toll increases. To address this fiscal crisis, the agency must prioritize operational savings, such as aligning maintenance efficiency and health benefit contributions, while carefully managing debt and service levels.
Recommendations related to MTA Reforms
The MTA should focus on improving the system’s operating efficiency to mitigate the need for drastic service cuts and layoffs.
The MTA should equalize employee and retiree health benefit contributions to those of State employees to generate annual savings.
The MTA should recalibrate service levels to match depressed ridership during the pandemic, even if it requires a break with the tradition of 24/7 service.
The MTA should pursue greater toll increases as a prudent measure, given that driving has returned more than ridership.
The decision to convert short-term debt to long-term debt should be made only after increasing efficiency, adjusting service levels appropriately, and determining federal aid levels.
Key Data
$15.9 billion
— Total budget gaps facing the MTA between 2020 and 2024.
$4.5 billion
— Amount of gap-closing initiatives the MTA has already begun implementing.
40 percent
— Proposed service cut on New York City Transit services.
50 percent
— Proposed service cut on commuter rail services.
$1 billion
— Potential savings from bringing bus operations and subway maintenance efficiency in line with other large systems.
$200 million
— Potential annual savings from equalizing employee and retiree health benefit contributions.
New York City taxpayers provide 71 percent of the Metropolitan Transportation Authority's non-fare and non-federal revenue, meaning the debate over whether the City or State pays its fair share ignores that City residents and businesses already foot the majority of the bill. Future funding sources, including new surcharges and taxes, will further increase the City's share of these subsidies, ensuring that local taxpayers continue to bear the primary financial burden for the transit system.
Key Data
71 percent
— of the MTA’s non-fare and toll, nonfederal revenue is provided by New York City taxpayers.
$1.7 billion
— of its own tax revenue was contributed by City taxpayers to the MTA in 2018.
$5.5 billion
— in State-authorized taxes were allocated to the MTA in 2018.
$3.9 billion
— was the amount City taxpayers contributed of the $5.5 billion in State-authorized general and regional taxes.
$6 billion
— was the total amount City taxpayers contributed to non-fare and toll, non-federal MTA revenue in 2018.
93 percent
— of new funding sources will be paid by City taxpayers in 2020.
The Metropolitan Transportation Authority's current emergency debarment regulations, which automatically penalize contractors for project delays or cost overruns exceeding 10%, discourage vendor participation and reduce competition for critical infrastructure work. Revising these policies to allow for administrative discretion would better balance contractor accountability with the need to maintain a robust pool of qualified vendors for the agency's $55 billion capital plan.
Recommendations related to MTA Reforms
The MTA Board should revise the regulations to not mandate automatic debarment, but rather follow the law to allow the MTA discretion to take into consideration the circumstances of each project and the pool of vendors able to perform the particular work.
Key Data
$55B
— The size of the MTA's largest ever capital plan, which faces challenges due to the current debarment policies.
$38.8 million
— The value of a design-build contract for station accessibility upgrades that failed to attract three potential vendors due to excessive risk.
three
— The number of vendors that declined to submit proposals for a design-build contract due to concerns over contract terms including debarment.
ten percent
— The threshold by which projects going over budget or schedule trigger automatic debarment for contractors.
The MTA faces a dire financial situation with projected deficits, yet plans to hire 581 new police officers, which will cost $260 million over the 2020-2023 financial plan and push the operating deficit to $1 billion. Before proceeding with these hires, the MTA must identify how to fund this expenditure without further increasing its operating deficit or reducing transit service.
Recommendations related to MTA Reforms
Before authorizing the hiring of 581 new officers, the MTA Board needs to know exactly how the MTA will find the funds to pay for them without increasing the operating deficit.
The MTA should work with the NYPD and its own officers to establish clear goals and expectations and maximize the effectiveness of existing policing.
The MTA Board must identify how it will cover the cost of this expenditure without increasing the MTA’s operating deficit.
Key Data
$56.1 million
— The cost of increasing the MTA police force by 500 officers and 81 supervisors in the first year.
$119.9 million
— The cost of increasing the MTA police force by 500 officers and 81 supervisors in the tenth year.
$260 million
— The cost of the new officers over the 2020-2023 financial plan.
$1 billion
— The projected operating budget deficit after accounting for the new officers.
$40 million
— The amount the Manhattan DA announced it would give the MTA over four years to reduce fare evasion.
2,500
— The number of NYPD officers currently assigned to patrol subway and buses.
The Metropolitan Transportation Authority's 2020 financial plan projects cumulative deficits reaching $740 million by 2023, relying on optimistic assumptions regarding savings, wage growth, and economic stability. To address these fiscal challenges, the Authority must refine its Transformation Plan, clarify budget reduction strategies, and pursue zero-cost labor agreements.
Recommendations related to MTA Reforms
MTA leaders should focus on developing and detailing the Transformation Plan.
The Authority should realistically assess its savings potential and pursue the changes on which it depends.
MTA leaders should specify the elements of the Budget Reduction Program and integrate them with the Transformation Plan without causing a negative impact on service.
The Authority should seek zero-cost wage settlements in current collective bargaining.
MTA leaders should monitor economic developments to adjust as needed to potential downturns.
Key Data
$740 million
— Cumulative deficit projected for the MTA in 2023.
$538 million
— Annual savings the financial plan counts on from the Transformation Plan in 2023.
$376 million
— Savings from the Budget Reduction Program in 2023.
$1.7 billion
— Potential revenue loss if a recession similar to the average of three previous recessions occurs.
2 percent
— Annual salary increase assumed in the financial plan.
57 quarters
— Duration of unbroken economic growth through 2023 if the current expansion continues.
The Metropolitan Transportation Authority should reconsider a proposed rule that mandates a five-year debarment for contractors who exceed project timelines or submit invalid claims by more than 10 percent. Instead of relying solely on punitive measures, the agency should incorporate discretionary authority and implement incentive-based procurement reforms to encourage efficient contractor performance.
Recommendations related to MTA Reforms
The MTA should reconsider the proposed rule regarding five-year debarment of contractors that exceed the timeline for substantial completion or submit invalid claims.
The MTA should grant the MTA discretion whether to debar a contractor when debarment would disadvantage the MTA.
The MTA should incorporate a debarment remedy as part of an overall reform to the MTA procurement process.
The MTA should introduce incentive-based measures to award the best performing contractors alongside discretionary debarment for the worst performing contractors.
Key Data
10 percent
— The threshold for exceeding the timeline for substantial completion or submitting invalid claims that triggers mandatory debarment.
five years
— The duration of the proposed debarment for contractors that violate the new rules.
40 percent
— The portion of an unused contingency account awarded to the contractor as an incentive payment during the JFK Airport AirTrain project.
$12 million
— The value of the incentive payment awarded to the contractor for the JFK Airport AirTrain project.
The Metropolitan Transportation Authority faces a dire fiscal outlook with projected annual cash deficits reaching $976 million by 2022, necessitating a shift toward self-funded wage increases and productivity improvements. To achieve financial stability, the authority should negotiate labor contracts that include increased employee contributions to health insurance and work rule reforms, such as more flexible scheduling and reduced penalty payments.
Recommendations related to MTA Reforms
The MTA should revise its financial plan to ensure that any pay increases are conditioned on generating offsetting savings.
MTA management and labor should set productivity goals and collaboratively develop an agenda of collective bargaining changes that would allow both sides to achieve these goals.
New collective bargaining agreements could reduce penalty payments made to bus operators scheduled to work across both morning and evening peak periods and eliminate allowances for time not worked.
The MTA should eliminate restrictions on hiring more part-time bus operators and restrictions on express bus scheduling to allow the authority to orient service toward peak periods.
Management should be allowed to schedule split runs for subway train operators and conductors to allow for more efficient scheduling of those workers.
Key Data
$976 million
— Projected annual cash deficit for the MTA in 2022.
$3.4 billion
— Amount spent by the MTA on fringe benefits for workers and retirees in 2018.
$444 million
— Estimated annual savings if MTA bus productivity matched the median of selected U.S. systems.
$496 million
— Estimated annual savings if subway maintenance productivity increased to the median for selected U.S. systems.
$86 million
— Estimated savings if the Long Island Rail Road matched the total productivity of Metro-North.
$84,955
— Median annual earnings for MTA workers in 2017.
$175.5 billion, the size of the NYS Budget for FY 2020 enacted by the Legislature. The budget includes several notable policy changes, such as funding and new reforms at the MTA. CBC's David Friedfel and Patrick Orecki discuss the key takeaways.
The New York State budget agreement includes the implementation of a congestion pricing program to fund the Metropolitan Transportation Authority, alongside new dedicated tax revenue streams. While these measures aim to improve transit efficiency and capital project execution, concerns remain regarding the potential for fee exemptions to undermine revenue and the administrative burden of mandated design-build contracting requirements.
Recommendations related to MTA Reforms
It is critical to limit fee exemptions in the congestion pricing program in order to preserve projected revenues and traffic reduction.
New revenues for the MTA should not replace resources already promised by the State.
The State should reconsider the mandate to use design-build contracting on all projects greater than $25 million, as it may be counterproductive and the waiver process is unnecessarily burdensome.
The 10-Point Plan to Transform and Fund the Metropolitan Transportation Authority represents positive progress by addressing key financial needs through congestion pricing and regular fare increases. The plan requires further clarification regarding the Regional Transportation Committee's oversight role and should avoid earmarking uncertain revenue sources like marijuana excise taxes in statute.
Recommendations related to MTA Reforms
The MTA requires the participation of labor and increased productivity by all segments of the workforce to achieve cost containment and management improvement.
New revenue sources like internet sales taxes and marijuana excise taxes should be allocated in the budget process and not 'earmarked' in statute.
Clarification is needed on the Regional Transportation Committee’s (RTC) role in reviewing the capital program and toll and fare increases required to fund it.
The Regional Transportation Committee should not become an obstacle to timely approval of the capital program or fare increases.
The New York State Senate is urged to conduct public confirmation hearings for all appointees to the Metropolitan Transportation Authority to ensure robust legislative oversight and accountability. This process would allow for the public evaluation of candidates' qualifications, potential conflicts of interest, and commitments to transit accessibility and transparency.
Recommendations related to MTA Reforms
The State Senate should conduct confirmation processes for appointees to the Metropolitan Transportation Authority (MTA) through public hearings.
The State Senate should follow the example of the 2009 public hearing for the appointment of Jay Walder as Chairman/CEO in consideration of any forthcoming appointees for the MTA.
The Metropolitan Transportation Authority requires regular fare and toll adjustments to maintain fiscal health and fund necessary service improvements, as fares currently cover less than half of operating costs. Without these increases, the transit system faces significant budget cuts and growing deficits that threaten the $40 billion Fast Forward modernization program.
Recommendations related to MTA Reforms
The MTA board should ensure both that the authority is adequately funded and that management is pursuing — and achieving — adequate standards of service.
The MTA must be leaner and must right-size service as it restores the transit system from the depths of its state of emergency.
The board must approve the planned fare and toll increase to avoid performance declines and a return to a fare policy often characterized by larger, sporadic and politically fraught jolts.
A renewed board effort for stricter oversight of MTA performance could benefit the system and its users.
Key Data
44%
— Portion of the cost to run the transit system covered by rider fares.
$1.93
— Average cost paid per trip by most transit riders.
$250 million
— Amount the MTA would have to cut from its 2019 budget without revenue from fare and toll increases.
$1 billion
— Projected cash deficit for the MTA by 2022.
$40 billion
— Total cost of the 10-year Fast Forward program to restore and modernize the transit system.
New York State should implement a comprehensive congestion pricing plan to provide necessary funding for the Metropolitan Transportation Authority. This initiative must be paired with significant management reforms to ensure the transit system operates efficiently and effectively.
Recommendations related to MTA Reforms
The State should enact congestion pricing to support the MTA.
The Governor should implement a full congestion pricing plan in concert with reforming MTA management.
The State should ensure that all of the revenue from congestion pricing is dedicated to the MTA.
The December 2018 Metropolitan Transportation Sustainability Advisory Workgroup Report highlights significant fiscal and managerial challenges facing the Metropolitan Transportation Authority. Addressing these issues requires implementing congestion pricing, conducting independent audits of capital costs, and enacting procurement and operational reforms.
Recommendations related to MTA Reforms
Establish a congestion pricing zone in Manhattan and devote all resulting revenue exclusively to MTA capital investments.
Conduct an independent audit of capital costs and state of good repair needs.
Implement procurement reforms to improve MTA fiscal health.
Increase flexibility in closing subway lines for construction and maintenance.
The New York City subway system faces a critical need for significant investment to restore its aging fleet to a state of good repair, as past deferred maintenance and reduced capital spending have led to declining reliability. Achieving this goal requires prioritizing subway car investments within future capital plans to ensure the fleet can support a modernized signal system and meet performance standards.
Recommendations related to MTA Reforms
MTA leadership should increase significantly its commitment to subway cars in the 2020-2024 capital program to return car reliability to its previous highpoint.
The MTA must prioritize subway car investments to avoid placing added pressure on the fleet’s maintenance and squandering hard-fought gains in reliability.
The MTA must ensure that the Fast Forward plan is fully funded in future capital plans and administered effectively to achieve anticipated results.
The MTA should accelerate the procurement of new cars and the retrofitting of existing cars to restore the fleet to a state of good repair.
Key Data
$9 billion
— Estimated total procurement cost for subway cars.
35 percent
— Decline in mean distance between car component failures (MDBF) from 2011 to 2016.
$8.3 billion
— Combined cost of R211s and additional cars.
$40 billion
— Initial estimates of the entire Fast Forward program costs.
$1.8 billion
— Cost of the Subway Action Plan (SAP) to reverse declining performance.
$3.9 billion
— Amount invested in bringing the subway car fleet to a state of good repair between 1982 and 1991.
The "Fast Forward" plan to modernize New York City Transit offers a promising approach to improving subway reliability and safety, particularly through the acceleration of signal modernization. To ensure long-term success, the Metropolitan Transportation Authority should prioritize a state of good repair for all system components and transition to a ten-year capital planning cycle.
Recommendations related to MTA Reforms
The Metropolitan Transportation Authority should explicitly relate the measures identified to progress toward achieving a state of good repair for all system components including stations, track, and line equipment.
Equal attention should be given to the more hidden elements of the system that are vital to reliability and safety.
The Metropolitan Transportation Authority might benefit from moving from the current system of five-year capital plans to a ten-year capital plan that is revised every five years.
The Long Island Rail Road is significantly less efficient than the Metro-North Railroad, with higher operating costs per hour, mile, and ride, partly due to legacy costs and work rule inefficiencies. To improve financial sustainability, the Metropolitan Transportation Authority must prioritize productivity reforms and standardize work rules across its commuter railroads during collective bargaining.
Recommendations related to MTA Reforms
Simply standardizing work rules across the two railroads could help generate savings.
MTA management should begin identifying its agenda for improved productivity ahead of the next round of collective bargaining.
The MTA should seek commitments to increase productivity in future collective bargaining agreements, as previous deals have lacked these provisions.
The MTA should increase the share of LIRR costs covered by fares to match the recovery ratio of Metro-North.
Key Data
$1,453 million
— LIRR operating expenses in 2017.
$1,310 million
— Metro-North operating expenses in 2017.
$130 million
— LIRR overtime expenses in 2017.
$92 million
— Metro-North overtime expenses in 2017.
$60 million
— LIRR retiree health insurance expense in 2017.
$32 million
— Payments to cover the unfunded portion of the closed LIRR pension plan in 2017.
The Metropolitan Transportation Authority's Enhanced Station Initiative, which allocates nearly $1 billion to upgrade 32 subway stations with aesthetic and technological improvements, diverts critical funding from essential infrastructure repairs and system-wide performance needs. Given the system's declining reliability and the fact that many selected stations are not among the most heavily used or dilapidated, the agency should reevaluate whether these cosmetic enhancements are the most effective use of limited capital resources.
Recommendations related to MTA Reforms
The MTA should reexamine whether the enhancement of 32 stations is worth the trade-off against other capital needs as part of its 60-day review.
The MTA must consider whether future riders will be better off waiting out the delays at enhanced stations as it reviews its capital program to address the current state of emergency.
Key Data
$2.8 billion
— Amount added to the size of the 2015-2019 capital program.
$1 billion
— Additional capital funds allocated for enhancements that precludes their use for component projects.
$64 million
— Project reserve included in the plan and designated for the Enhanced Station Initiative.
$1.1 billion
— Amount added to the existing plan for subway stations projects.
$4 billion
— Total funding for subway stations projects following the amendment.
$340 million
— Funding supported increases in commitments to making stations accessible for the disabled.
This week's data point is 30 days - the period in which MTA New York City Transit will conduct a "top-to-bottom" review to identify changes necessary to improve its performance. CBC's Director of Infrastructure Studies Jamison Dague discusses underinvestment and how resources are being directed in the capital plan with…
The Metropolitan Transportation Authority faces significant challenges, including declining subway and bus performance, increased train cancellations, and a substantial backlog of uncommitted capital projects. To address these issues, leadership must prioritize cost-effective investments, improve transparency in capital spending, and accelerate the modernization of the transit system.
Recommendations related to MTA Reforms
The MTA will need to work with regional partners to ensure the riding public is spared as much inconvenience as possible and ensure scheduled trains run on time.
As the MTA reevaluates the current capital program and looks to the 2020-2024 plan, leaders should prioritize those investments needed to restore the system and enhance capacity in the most cost-effective manner.
A more transparent process should be pursued so that the public may hold the board responsible for distributing limited capital dollars wisely.
To modernize the system, these investments should be accelerated to the maximum extent possible.
Key Data
84 percent to 66 percent
— The share of subway trains reaching their scheduled terminal on time fell from 84 percent to 66 percent between January 2013 and 2017.
165,946 miles to 119,090 miles
— The 12-month rolling average for the mean-distance-between-failure of subway cars declined from 165,946 miles to 119,090 miles as of March 2017.
91 to 197
— The 12-month rolling average of Long Island Rail Road trains canceled and partially canceled per month more than doubled from 91 to 197 between January 2013 and May 2017.
$33 billion
— As of March 2017, $33 billion in capital investments has been authorized but remains uncommitted.
The Metropolitan Transportation Authority's recent capital plan amendment prioritizes new expansion projects over critical maintenance and modernization, despite ongoing service deterioration. To improve system reliability, the agency should shift funding toward essential state of good repair work and signal system upgrades rather than deferrable expansion efforts.
Recommendations related to MTA Reforms
Future amendments should reprioritize funds for more appropriate state of good repair work and for the modernization of the subway’s aging signal system.
The board should require more transparency of changes to the capital program going forward.
The agency should emphasize what it can accomplish if capital funds are spent on state of good repair projects, existing system improvements, or both.
Board members and the public must remain engaged in the MTA’s capital planning process to ensure the region does not squander another opportunity to reinvest.
Key Data
$2.8 billion
— Amount of new investments added to the current five-year capital plan.
$29.5 billion
— Total value of the current five-year capital plan following the latest amendment.
$20 billion
— Estimated cost of continuing needs for New York City Transit in 2017 dollars.
$2 billion
— New capital commitments allocated to the Long Island Rail Road Expansion Project.
$700 million
— New capital commitments added for Phase II of the Second Avenue Subway.
14%
— Share of New York City Transit capital funding dedicated to signal modernization in the 2015-2019 plan.
The Metropolitan Transportation Authority faces a projected deficit exceeding $2.7 billion in 2017, driven by operating expenses that have grown by an average of 3.9 percent annually since 2009. To address these fiscal challenges, the agency should increase transit fares by more than 4 percent and implement additional motor vehicle charges to better align revenue with rising costs.
Recommendations related to MTA Reforms
The Board should continue the policy of regular and predictable fare increases and move toward a long-term goal of covering approximately half of mass transit expenses with fare revenue.
Additional revenue should be raised from motor vehicle users to achieve a long-term goal of fully covering bridge and tunnel expenses and generating a surplus sufficient to fund one-quarter of mass transit operating expenses.
Transit fares should increase greater than 4 percent in 2017 and 2019 to better align with rising operating expenses.
The MTA should seek additional motor vehicle use charges to cross-subsidize transit, such as tolling East River Bridges or introducing a vehicle-miles traveled user fee.
The MTA should ensure the contractor and the agency have the capacity to implement an income-conditioned fare structure so that it can be implemented quickly if adopted by the City.
The MTA should explore peak pricing on subways and buses to reduce rush hour crowding.
The MTA should cap the number of allowed rides for weekly and monthly passes to improve services and finances.
Key Data
$2.7 billion
— The MTA's projected deficit using Generally Accepted Accounting Principles in 2017.
3.9 percent
— The average annual increase in operating expenses since the MTA implemented a fare increase in 2009.
42 percent
— The increase in fringe benefits for employees and retirees since 2009.
$90 million
— The estimated potential yield from capping the number of allowed rides for weekly and monthly passes in 2015.
$1.86
— The average revenue per ride on the transit system.
40 percent
— The portion of relevant expenses currently covered by transit fares.
NY1 About 150,000 disabled New Yorkers use the MTA's pricey Access-A-Ride service to get around the city each day. Two new studies are proposing ways to dramatically improve service and save taxpayers more than $100 million a year.
New York City's Access-A-Ride paratransit program is the most expensive in the nation, costing $461 million in 2015 with a high cost per trip of $71. To improve efficiency and reduce the heavy reliance on internal MTA cross-subsidies, the agency should shift ambulatory trips to lower-cost providers, increase the use of feeder services, and pursue Medicaid reimbursement for eligible medical trips.
Recommendations related to MTA Reforms
The MTA should shift ambulatory trips to its broker car service (BCS) program, which could save the MTA up to $126 million annually.
The MTA should establish a subsidy program for paratransit trips completed by taxicabs and Transportation Network Companies (TNCs) like Uber and Lyft.
The MTA should double the paratransit fare, which could save as much as $184 million annually by reducing trips and increasing fare revenue.
The MTA should increase the use of feeder service, which connects users with accessible fixed-route stops rather than door-to-door service, to save up to $20 million annually.
The MTA should seek Medicaid reimbursement for non-emergency medical transport to generate an additional $10 million to $14 million annually.
The MTA should consider an overhaul of the contracting relationships by moving to a full-service brokerage model to potentially save up to $30 million annually.
Key Data
$461 million
— The total cost of the Access-A-Ride program in 2015.
$71
— The cost per trip for Access-A-Ride in 2014, the highest among 29 cities with large paratransit programs.
17
— The number of people registered to use the service per 1,000 residents in New York City.
$126 million
— The potential annual savings from shifting all ambulatory customers to the broker car service program.
$184 million
— The potential annual savings from doubling the paratransit fare.
$646 million
— The projected total program expenses for Access-A-Ride in 2020.
The potential impact of an economic downturn on the MTA could reach $1.5 billion, representing 3.9 percent of the agency's 2018 budget. The MTA should proactively prepare for a future recession to mitigate these risks without increasing long-term costs.
Key Data
$1.5 billion
— potential impact of an economic downturn on the MTA
3.9 percent
— of the MTA's 2018 budget that could be impacted by an economic downturn
The Metropolitan Transportation Authority struggles to maintain subway stations in a state of good repair, as current capital plans fail to address the backlog of deteriorating structural components. To improve progress, the agency should reallocate funds from expansion projects, enhance project management to reduce cost overruns, and utilize public-private partnerships to secure additional capital.
Recommendations related to MTA Reforms
The MTA should reallocate funds from system expansions to state of good repair work to prioritize the maintenance of existing assets.
The agency must improve the management of projects to avoid delays and cost overruns, allowing more work to be completed with available funds.
The MTA should develop new public-private partnerships to secure additional private capital investment in stations and lower rehabilitation costs.
The agency should identify opportunities for introducing station conservancies to marshal resources for rehabilitating and maintaining stations on an ongoing basis.
Key Data
15,275
— Total number of structural components in the subway system.
3,195
— Structural components that will not be in a state of good repair after the 2010-2014 capital plan.
$5.5 billion
— Funding allocated for expansion projects across the mass transit system in the proposed 2015-2019 plan.
$1.3 billion
— Funding allocated for projects to improve station components in the proposed 2015-2019 plan.
$997 million
— Funding allocated for investments in elevators, escalators, and accessibility improvements in the proposed 2015-2019 plan.
The Metropolitan Transportation Authority faces significant financial instability due to recurring deficits and heavy reliance on borrowing for capital projects. To address this, a new "25-50-25" funding formula is proposed, which would rebalance costs among motorists, transit riders, and taxpayers to ensure long-term fiscal stability and infrastructure maintenance.
Recommendations related to MTA Reforms
The cost of bridge and tunnel facilities should be funded entirely through user fees paid by motorists.
Motorists’ tolls and fees should also generate a surplus large enough to cover approximately one-quarter of the cost of providing mass transit services.
Mass transit users should pay fares sufficient to cover approximately one-half the operating cost of those services.
State and local tax subsidies to mass transit should cover at least one-quarter of the operating cost of those services and fund “catch-up” capital investments needed to bring the system to a state of good repair.
The MTA should stop running large deficits and lower its future debt burden by funding regular replacement needs with operating revenues rather than borrowing.
Key Data
$17.1 billion
— Annual operating and financing expenditures of the MTA’s agencies budgeted for 2012.
$32 billion
— MTA debt outstanding in 2011.
$3.6 billion
— Projected deficit in 2016.
53%
— MTA system-wide farebox operating ratio in 2010.
$16.8 billion
— Total investment for five "megaprojects" with cost overruns of more than $3.6 billion.
$2.6 billion
— Additional annual revenue the 25-50-25 policy would provide by 2016.
The Metropolitan Transportation Authority's capital plan requires $32 billion, but faces a $15 billion funding gap and criticism for prioritizing expansion projects over essential infrastructure repairs and signal modernization. To address this, a '25-50-25' funding model is proposed, relying on a combination of tax subsidies, fare increases, and increased motor vehicle user charges like tolls and congestion pricing.
Recommendations related to MTA Reforms
The MTA should prioritize bringing aged infrastructure to a state of good repair rather than focusing on new expansion projects.
The MTA must accelerate the modernization of signal and communication systems, specifically the installation of Communications-Based Train Control.
The MTA should implement a '25-50-25' funding approach, where 25 percent of costs are covered by tax subsidies, 50 percent by user fares, and 25 percent by motor vehicle cross-subsidies.
The MTA should pursue modest fare increases to bring revenue closer to the 50 percent target for user fees.
The MTA should explore innovative revenue mechanisms like the Move New York plan, which includes a vehicle-miles-traveled tax to increase motor vehicle user contributions.
The MTA should require better planning and greater transparency before committing funds to new network expansion projects.
Key Data
$32 billion
— Total investment amount called for in the MTA's early capital plan version.
$15 billion
— The funding gap identified in the MTA's capital plan.
$5.5 billion
— Amount allocated in the proposed plan to projects that would expand the network.
$2.6 billion
— Cost overruns on the East Side Access project.
$1.6 billion
— Annual increase in funding from the payroll mobility tax authorized in 2009.
$167 to $293
— Annual increased costs motorists would face under the Move New York plan.
The MTA's 2015-2019 capital plan, which calls for $32 billion in investments, faces a $15.2 billion funding gap and fails to adequately prioritize essential repairs and signal modernization. Instead of committing to new expansion projects like the $10.8 billion East Side Access, the agency should establish clear criteria for project selection and adopt a more aggressive schedule for upgrading subway infrastructure.
Recommendations related to MTA Reforms
The proposed plan should be revised to address the insufficient progress in bringing aged infrastructure to a state of good repair.
The MTA should embrace a more ambitious schedule for Communications-Based Train Control (CBTC) installation and provide the necessary funding in the 2015-2019 plan.
Explicit criteria should be established for selecting priority projects and evidence should be considered as to how well a range of potential investments meet these criteria.
A prudent course for the MTA would be to postpone commitment to new expansion projects until an improved planning process is established and used to assess multiple potential projects.
Attention should be given to rethinking the management of large-scale projects, especially those for expansion and for improvements in the signal and communication systems, to promote more effective implementation.
Key Data
$32 billion
— Total investment amount called for in the MTA's 2015-2019 capital plan.
$15.2 billion
— The unfunded gap remaining in the MTA's 2015-2019 capital plan.
$5.4 billion
— The total shortfall in funding for major asset categories compared to the needs assessment.
$815 million
— The amount by which funds designated for communication and signals at NYCT were reduced from the needs assessment to the adopted plan.
$5.5 billion
— The amount allocated in the adopted plan for expansion projects.
$10.8 billion
— The current estimated cost of the East Side Access project, which was originally approved at $6.3 billion.
The Metropolitan Transportation Authority requires a fundamental restructuring to achieve long-term fiscal stability, including balancing its budget on a GAAP basis and implementing a more equitable revenue strategy that increases reliance on auto user fees. Additionally, the agency must modernize its labor relations, accelerate the adoption of advanced signaling technology, and prioritize capital investments to ensure physical assets reach a state of good repair.
Recommendations related to MTA Reforms
A reinvented MTA should balance its budget on a GAAP basis.
A reinvented MTA should have explicit policies for how it seeks to raise adequate revenues; the share from auto users should be significantly higher than is now the case.
A reinvented MTA would have a legal framework for labor relations that permits all its employees to bargain under the same set of rules and effectively prohibit strikes.
A reinvented MTA would have a timely plan for bringing its assets to state of good repair and would give highest priority in its capital investments to achieving that goal.
A reinvented MTA would make the financial investment and operational changes necessary for far speedier conversion to CBTC.
A reinvented MTA would quickly initiate planning and deployment of a new fare collection system that reduces collection costs, permits flexibility in future fares, and speeds passenger flow.
A reinvented MTA would take the lead in working with the other major regional transportation agencies to develop a plan for expanded trans-Hudson rail capacity.
Key Data
$33 billion
— The MTA’s long-term debt outstanding in 2013.
$10 billion
— The MTA’s unfunded OPEB liability at the end of 2013.
15 percent
— The current estimated cost of fare collection.
$115 billion
— Total capital investments made system-wide since 1982.
$106 billion
— The planned investment by the MTA over the next 20 years.
The Metropolitan Transportation Authority faces a severe long-term financial deficit, with GAAP-based annual shortfalls projected between $3.0 billion and $3.4 billion over the next four years. To address this, the agency should adopt a "50-25-25" funding model that balances costs between riders, tax subsidies, and auto-user fees while prioritizing renewed cost-reduction efforts.
Recommendations related to MTA Reforms
The MTA should adopt a funding model where fares cover 50 percent of full operating costs, a tax subsidy covers 25 percent, and a cross-subsidy from auto users covers the remaining 25 percent.
The agency should continue moderate but regular fare increases to ensure revenue covers operating costs.
Policymakers should enact new forms of auto-cross subsidy such as higher bridge and tunnel tolls, increased motor vehicle registration fees, or congestion pricing to secure major new funding.
The MTA must put renewed energy into cost reduction efforts to improve its financial standing.
Key Data
$2.8 billion
— The MTA's current annual deficit when calculated using Generally Accepted Accounting Principles.
$26.6 billion
— The estimated cost for core capital needs related to state-of-good-repair and rolling stock replacement between 2015 and 2019.
$1.3 billion
— The amount of annual savings the MTA intended to achieve by 2017 through cost-reduction measures launched in 2009 and 2010.
$67 million
— The actual annual savings generated by 2017 from cost-reduction initiatives outside of the paratransit program.
$1.9 billion
— The amount of new resources identified by the MTA since February 2013.
The Metropolitan Transportation Authority faces recurring deficits and inadequate capital investment, necessitating a new financing strategy to ensure long-term stability. A proposed "25-50-25" formula suggests allocating costs among auto user fees, transit fares, and state and local tax subsidies to create a more equitable and sustainable funding model.
Recommendations related to MTA Reforms
The cost of bridge and tunnel facilities should be funded entirely through tolls and fees paid by the motorists who use them.
Motorists’ tolls and fees should also generate a surplus large enough to cover approximately one-quarter of the cost of providing mass transit services.
Mass transit users should pay fares sufficient to cover approximately one-half the operating cost of those services.
State and local tax subsidies to mass transit should cover at least one-quarter of the operating cost of those services and fund 'catch-up' capital investments needed to bring the system to a state of good repair.
The MTA should stop running large deficits and lower its future debt burden by funding regular replacement needs with operating revenues rather than borrowing.
Key Data
$17.1 billion
— Annual operating and financing expenditures of the MTA’s agencies budgeted in 2012.
$2.6 billion
— Additional annual revenue the 25-50-25 policy would provide by 2016 without new taxes.
$32 billion
— MTA debt outstanding in 2011, which increased from $14 billion in 2000.
$16.8 billion
— Total investment represented by five "megaprojects" including the South Ferry Terminal, Flushing Line Extension, Second Avenue subway line, East Side Access, and Fulton Street Transit Center.
$3.6 billion
— Cost overruns for the five "megaprojects" mentioned in the report.
$2 billion
— Current annual depreciation at the MTA.
The Metropolitan Transportation Authority faces a significant debt burden, with $32 billion in long-term obligations that consume nearly one-third of its fare and toll revenue. To manage this, the agency should pursue debt refunding strategies that prioritize long-term savings and adhere to strict guidelines, rather than deferring costs to future taxpayers through back-loaded or stretched payment schedules.
Recommendations related to MTA Reforms
The MTA should follow guidelines that promote the greatest total savings and prevent the unfair passing of costs onto future taxpayers and straphangers.
The MTA Board should not seek any exemptions from the State Comptroller's guidelines regarding debt issuance.
Refunding strategies should not be used to balance the operating budget or to permit additional new borrowing in the absence of new revenue streams.
Key Data
$32 billion
— Long-term debt outstanding for the Metropolitan Transportation Authority.
$14,000
— Amount of debt for each worker commuting daily into New York’s central business district.
$2.1 billion
— Debt service cost in 2012, consuming nearly one-third of the revenue the MTA receives from fares and tolls.
$2.6 billion
— Projected debt service cost by 2015.
$39 billion
— Projected outstanding debt by 2015.
$180 million
— Minimum present value savings required for a $6 billion refunding under the MTA board's 3 percent policy.
The MTA faces significant financial deficits and must balance the need for fair employee compensation with the necessity of maintaining affordable fares and reliable service. Implementing structural reforms, such as merging conductor and train operator roles and increasing employee contributions to health insurance, is essential to achieving fiscal stability without further burdening riders.
Recommendations related to MTA Reforms
The arbitration award should include work rule changes that produce savings to allow for enhanced maternity benefits and the accelerated installation of clear partitions for buses.
A more ambitious award could provide for small wage increases, not to exceed inflation, funded by additional productivity concessions or added employee responsibility for health insurance costs.
The MTA should pursue merging the position of "conductor" and "train operator" to shift toward more efficient operations.
Awarding "net-zero" wage increases is fair and appropriate given the current economic climate and the fiscal outlook of the MTA.
The MTA should implement premium-sharing, increase the contribution toward retiree health insurance, or end the partial Medicare Part B reimbursement to offset costs.
Key Data
$720 million
— Projected savings from the MTA's wide-scale efficiency program in 2012.
$1.4 billion
— Total revenue expected to be raised from fare increases by 2015.
$92.4 million
— The budget gap that would be opened in 2012 by an award along the lines of projected inflation.
$42 million
— The cost increase for every one-point wage increase awarded to the TWU.
$2.50
— The proposed base fare if wage increases in line with inflation were funded by a 4 percent fare increase.
$500 million
— Recurring savings generated by the MTA's "top-to-bottom" efficiency program launched in 2010.
The Metropolitan Transportation Authority's bus systems rank among the lowest in the nation for cost efficiency and labor productivity, despite handling over 2.6 million daily passenger trips. Slower average speeds in New York, with NYCT Bus operating at 7.7 miles per hour compared to a 10.7 miles per hour median for major systems, contribute to these operational inefficiencies.
Key Data
2.6 million
— The Metropolitan Transportation Authority's buses handle more than 2.6 million passenger trips each day.
2.3 million
— NYCT Bus daily passenger trips total 2.3 million.
1.1 million
— MTA Bus daily passenger trips total 1.1 million.
873,000
— Chicago bus system daily passenger trips total 873,000.
7.7
— NYCT Bus operates at a speed of 7.7 miles per hour.
8.6
— MTA Bus operates at a speed of 8.6 miles per hour.
The Metropolitan Transportation Authority's subway system is relatively efficient compared to other large U.S. transit systems, though non-vehicle operations like station maintenance offer room for improvement. Conversely, the agency's bus and commuter rail operations are significantly less efficient, indicating a need for targeted reforms in vehicle maintenance and administrative functions.
Recommendations related to MTA Reforms
The MTA should utilize benchmarking of unit cost measures against other large urban transit agencies to identify and prioritize new efficiency initiatives.
The MTA should pursue efficiency improvements in non-vehicle operations for the subway system, such as addressing staffing patterns for stations.
The MTA should prioritize reforms for the two large bus systems, which are inefficient compared to national peers and represent a significant portion of operating expenses.
The MTA should address inefficiencies in commuter rail operations, specifically targeting high costs in vehicle maintenance and non-vehicle operations.
Key Data
$935 million
— Total projected savings from all identified initiatives in 2014.
$525 million
— Recurring savings expected from efficiency measures and service cuts.
$8.0 billion
— Total 2009 operating expenses for the five MTA passenger transport divisions.
The Metropolitan Transportation Authority should adopt a long-term policy to cover 50% of operating expenses through fare revenue, necessitating biannual fare increases greater than 7.5%. Additionally, the agency should investigate implementing peak pricing on subways and buses to shift ridership patterns and reduce crowding.
Recommendations related to MTA Reforms
The subway, bus and railroad fare increases to be approved for January 2011 and proposed for January 2013 should move toward establishing a long-term policy to cover 50% of mass transit operating expenses with fare revenue.
The MTA should explore the feasibility of incorporating in its fare policy for subways and buses the practice of “peak pricing.”
Growth in expenditures should be constrained through all available means including aggressive collective bargaining to limit wage and fringe benefit costs.
Fare increases greater than 7.5% biannually will be needed to move fare revenue closer to 50% of relevant expenses.
Key Data
39%
— In 2009, fares covered about 39% of the operating expenses of the MTA net of bridge and tunnel operations.
50%
— The target for fare revenue coverage of mass transit operating expenses is 50%.
39%
— Typical peak hour fares for a single ride on the LIRR are about 39% higher than at off-peak.
28%
— In London, the typical premium for a peak hour subway ride is about 28%.
22%
— In Washington DC, the typical premium for a peak hour subway ride is about 22%.
50%
— Single rides account for a reported 50% of total rides on subways and buses.
The proposed 2010-2014 MTA capital plan outlines $28 billion in investments but identifies only $18 billion in funding, leaving a $10 billion gap that requires a more realistic approach to project management and financing. To address these shortfalls, the plan's priorities should be re-examined to focus on critical infrastructure repairs and a more balanced funding model that relies less on general tax subsidies.
Recommendations related to MTA Reforms
New reporting requirements mandated by the Legislature should be implemented to improve the transparency of capital projects.
The MTA should commit to greater transparency in informing the public about the status of its capital projects.
The MTA should improve its capacity to manage mega-projects and improvements in signaling and communications systems.
The capital program should be amended using a pragmatic approach: the size of the plan should be downsized to reflect a realistic assessment of what can be accomplished.
Planning for the capital plan should be tied more directly to the needs assessment, and priorities should be altered in favor of achieving a state of good repair.
The MTA should publish an unconstrained needs assessment to better inform the composition of the capital plan.
More funds can and should be raised from the farebox and from auto-users to support the capital program and operating needs.
Key Data
$28 billion
— Investment amount outlined in the proposed 2010-2014 capital plan.
$18 billion
— Funding sources identified for the proposed 2010-2014 capital plan.
24 percent
— Cost increase above the initial estimate for the South Ferry Terminal project.
90 percent
— Cost increase above the initial estimate for the Fulton Street Transit Center.
$130 billion
— Adjusted needs estimate for the 20-year period (2010-2029).
$10 billion
— Funding gap existing for the full five-year capital plan period.
The Metropolitan Transportation Authority's capital planning process suffers from significant delays and cost overruns, with many projects failing to meet initial schedules or budgets. To improve accountability, the agency must adopt a more realistic assessment of project feasibility and implement a transparent, centralized management information system for tracking capital projects.
Recommendations related to MTA Reforms
The MTA should commit to an improved management information system for tracking capital projects and to greater transparency in informing the public about the status of its capital projects.
The MTA should improve its capacity to manage mega-projects and improvements in signaling and communications systems, as these are the areas of greatest delays and cost increases.
The next five-year plan should be based on a realistic assessment of what can be accomplished, rather than overly ambitious projections that lead to deferred work.
Key Data
$18.6 billion
— Total estimated cost of the 798 capital projects examined by the commission for the 2005-2007 period.
$28.1 billion
— Proposed total commitment amount for the 2010-2014 MTA capital plan.
90 percent
— Amount by which the cost of the Fulton Street Transit Center exceeded its initial estimate.
24 percent
— Amount by which the cost of the South Ferry Terminal exceeded its initial estimate.
35 percent
— Cost increase for the Automatic Train Supervision project.
$1.9 billion
— Estimated cost of the 80 projects that were dropped from the capital plan by 2007.
The MTA requires a revised funding strategy that relies more heavily on fare increases and auto user fees rather than new tax revenues, while simultaneously implementing stricter spending controls and transparency measures. To achieve a goal where fares cover 50 percent of expenses, annual fare hikes of approximately 7 percent are necessary, alongside improved governance and accountability for all capital projects.
Recommendations related to MTA Reforms
The MTA board should be required to accept responsibility for substantially lowering the growth in operating expenses through targets in multi-year financial plans.
A two or three year schedule of fare increases should be implemented to bring the share of expenses covered by the fare to approximately 50 percent.
The proposed tolls on East River Bridges and Harlem River Bridges should be higher than the Commission recommends to provide a greater incentive to shift to mass transit.
The transparency recommendations should apply to projects in the current capital plan as well as future ones to ensure accountability for all dollars.
The governance of the MTA should be improved by revising the roles of the Chair and Executive Director, specifically by giving the chair executive authority.
Key Data
50 percent
— The target share of operating expenses that should be covered by passenger fares.
7 percent
— The approximate annual fare increase required to reach the 50 percent cost-coverage goal by 2011.
8 percent
— The initial fare hike recommended by the Commission, which is considered too low.
300
— The number of projects in the 2000-2004 capital plan that had nearly a quarter of total commitments still uncommitted at the end of 2004.
The MTA faces significant budget shortfalls, requiring a restructuring of funding sources to balance the burden between riders, drivers, and taxpayers. Implementing a 50/25/25 funding formula would necessitate fare increases and higher contributions from drivers to ensure long-term financial stability without relying on new major tax hikes.
Recommendations related to MTA Reforms
Fares should cover half of mass-transit operating costs.
The MTA must link fares to costs to create an incentive for efficiency and depoliticize fare-hike decisions.
Drivers should pay a quarter of the cost of mass transit, in addition to the full cost of MTA bridge and tunnel operations.
A general tax subsidy should cover the remaining 25 percent of mass-transit costs.
The commission should avoid proposing major new taxes dedicated to the MTA, such as a payroll tax or increased sales tax.
Key Data
$1.2 billion
— The MTA's 2009 cash shortfall.
$2.7 billion
— The MTA's projected 2012 cash shortfall.
46 percent
— The portion of mass-transit operating costs currently covered by fares.
15 percent
— The required fare increase in 2009 to reach the 50 percent coverage target.
$1.3 billion
— The additional revenue needed from drivers in 2009 to meet the 25 percent funding target.
13 percent
— The current portion of mass-transit costs covered by driver revenues.
The Metropolitan Transportation Authority faces growing operating deficits and capital investment shortfalls, requiring a restructuring of its financing model to ensure long-term sustainability. A more balanced approach would align bridge and tunnel tolls, farebox revenue, and government subsidies with the actual economic costs and benefits of the services provided.
Recommendations related to MTA Reforms
The cost of bridge and tunnel facilities should be paid for entirely through user fees paid by motorists.
User fees paid by motorists should also generate a surplus large enough to cover one-quarter of the cost of providing mass transit services.
Mass transit users should pay fares sufficient to cover one-half the operating cost of those services.
State and local subsidies to mass transit should cover one-quarter of the operating cost of those services and fund "catch-up" capital investments needed to bring the system to a state of good repair.
Key Data
$9 billion
— MTA operating expenses budgeted for 2006.
$1.1 billion
— The amount by which operating deficits exceeded this figure in two of the five years preceding 2006.
$22 billion
— Total debt outstanding for the MTA at the end of 2005.
$32 billion
— Projected debt for the MTA in 2010.
$1.3 billion
— Estimated annual cost of replacing capital used in operations.
$1.382 billion
— Estimated annual net gain from implementing a London-like congestion pricing plan.
The New York region's transportation system suffers from inadequate maintenance, fragmented planning, and inconsistent pricing, with mass transit facing a $1.2 billion annual deficit. To address these issues, the region should establish a unified policy board, dedicate motor vehicle user fees to transportation, and increase transit fares to cover half of operating costs while accelerating the elimination of maintenance backlogs.
Recommendations related to MTA Reforms
The governors of New York and New Jersey should create a new entity with authority to set and enforce regional transportation policies and priorities.
The region’s transportation agencies should have sufficient resources to meet all necessary operating expenses.
Motor vehicle user fees should be dedicated to transportation agencies to cover the operating costs of roads and bridges and provide a cross-subsidy to mass transit.
Mass transit riders should pay a fare sufficient to cover one-half the transit agencies’ operating costs.
New capital for improvements and expansions should be generated by borrowing and ensuring that contributions to capital from third parties are used for this purpose.
The existing backlog in maintenance and repairs should be eliminated at an accelerated pace and be financed by general fund appropriations.
Key Data
$13 billion
— Combined annual operating expenditures of the 25 transportation agencies in the region.
$1.2 billion
— Total mass transit operating deficit in 2001.
37 percent
— Percentage of bridges in both New York and New Jersey that are structurally deficient or obsolete.
$5.7 billion
— Total user fees collected from auto users in the region.
$3.5 billion
— Total fares collected from mass transit riders in the region.
39 percent
— Percentage of urban roads in New York that are in unacceptable condition.
New York's transportation infrastructure is extensive but faces significant challenges, including high operating costs and a substantial backlog of capital needs for state-of-good-repair projects. To improve competitiveness, the city must focus on modernizing signaling systems, optimizing off-peak ridership, and addressing the multi-billion dollar funding gaps in both highway and mass transit maintenance.
Recommendations related to MTA Reforms
An initiative aimed at identifying modern human resource measures could help enhance New York’s future competitiveness.
Experiments with higher fares at the busiest time could identify effective ways to shift some ridership to the less crowded hours.
The initiative could be made even more effective if employers were encouraged to cooperate by facilitating flexible working hours.
Modern signaling and train control systems are capable of reducing safe headways.
Attracting more riders to the existing system would reduce average costs per passenger.
Key Data
$12.2 billion
— Estimated funding needed for New York City highways over the ten-year period spanning fiscal years 1998 to 2007.
$8.1 billion
— Amount allocated by the City for highway infrastructure over the ten-year period spanning fiscal years 1998 to 2007.
$20.4 billion
— Estimated funding needed to achieve and maintain a state of good repair for facilities operated by the Transit Authority.
$9.7 billion
— The funding gap in four capital budget categories—line structures, signals, line equipment, and stations and communications.
1.1 billion
— Total subway trips made in 1998.
2.0 billion
— Total subway trips made in 1946, the peak year for ridership.
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