Thursday, May 07, 2009

MTA Money Pit

Well, the deal to bail out the MTA was finally struck and voted on yesterday; but the state's unaccountable money pit is till standing-poised for future cash outlays with no relief in sight. In spite of the failure to really reform and revamp the agency, however, city motorists were spared the tolls that one and all claimed was absolutely necessary to save the system: "In December, a state commission appointed by Paterson, and headed by former MTA Chairman Richard Ravitch, recommended a payroll tax and tolls on the East and Harlem River bridges to raise transit subsidies. Tolls, however, were opposed by a handful of Senate Democrats."

The MTA did receive a deserved tongue lashing from the senate leader, but no concrete action appears to be part of the deal: "But even as he championed the plan on the Senate floor, Smith blasted the MTA, calling it "bloated," "a black hole" and a "runaway train." "We inherited a mess," he said, promising to bring about an improved authority through a series of reforms." Let's hope so.

But right now, we have a rescue plan that adds additional tax burdens on a struggling New York economy. As Nicole Gelinas points out in the NY Post this morning: "For what taxpayers are giving up here, they should've gotten more in return. Lost in the relief over the averting of MTA bankruptcy is the fact that the $1.5 billion annual payroll tax created to fund the deal is a tax on jobs. New York is already the least business-friendly state -- and Downstate is already hemorrhaging jobs."

Make no mistake here, this rescue is a band aid-and the future of the transit system hasn't received long term resolution: "The numbers that state legislators and the MTA have laid out in the MTA budget leave little room for error. For example, for the seven months left in this year (if all goes perfectly) the budget's higher taxes, fees and fares will bring in $1.3 billion. But the MTA was facing a deficit of at least $1.5 billion, even after making cuts that didn't involve service."

The mayor, for his part, was tepidly supportive of the deal; still chagrined that there are no tolls to keep the riff raff out of Manhattan: "The mayor reminded the press (including DN City Hall Bureau Chief Adam Lisberg, who kindly provided me with the transcribed quotes) that he had preferred the tax-and-tolls plan proposed by Richard Ravitch because it had the added benefit of being likely to reduce congestion - a pet issue of his."

What's needed now, is for the legislature to take a long hard look at the MTA; and determine whether the authority, as currently constructed, deserves to remain. The deal struck yesterday is simply a stop gap-and if the regional economy doesn't improve, the Moneypit Transit Agency will continue to absorb our tax dollars like a sponge.