Under Lhota, MTA Doing Better

NEW YORK—The preliminary 2013 to 2016 budget for the Metropolitan Transportation Authority was detailed Wednesday amid optimism over recently announced service restorations.

About one-third of cut bus routes and subway lines will be restored, along with new routes and extensions, the MTA announced on July 19.

The mid-year forecast for 2012, which includes a balanced budget, shows the MTA’s finances have improved since February—the reason behind the restorations—and other recent years, when they faced up to a half-a-billion-dollar deficit.

That’s good news, though it’s not as good as, say 2007, according to Bill Henderson, president of the Permanent Citizens Advisory Committee to the MTA. The MTA had a stellar year in 2007 and was able to “catch up on pension obligations,” among other positive actions, said Henderson.

“But at least we’re stable and we don’t have these half billion dollar projected deficits in out years,” he added. “It seems, at least, that what’s being projected is manageable, whereas several years ago we had some very scary numbers.”

More than a dozen people spoke to the MTA board Wednesday. Many praised the entity for committing $29.5 million for adding new lines and restoring ones that had been cut, but advocated for starting the restorations sooner. The lines are slated to be rolled out from October this year through September 2013.

Another concern: the impending fare hikes. Fare hikes are pegged for next year and 2015, though the start date has been pushed back until March of both years.

Cost-cutting actions have enabled recurring savings for the MTA of $686 million in 2011, a number that is projected to grow to $1.13 billion in 2016.

Actions include eliminating positions within the MTA; reducing unnecessary overtime; and eliminating 20 percent of mobile devices; 1,000 computers; and 1,400 printers.

But, despite savings, expenses not under the MTA’s control—pensions, employee and retiree health care costs, and paying off debt—are the reason fares must be raised, said Joseph Lhota, MTA chairman and CEO. These three categories will cost the MTA more than $5 billion in 2012.

The 2013 proposed fare raise would garner $400 million annually; the proposed raise in 2015 would garner $500 million annually.

The MTA will make about $6.5 billion—52 percent of its revenue—from fares and tolls across its system in 2012, according to its mid-year forecast.

Also, funding from the state Legislature has not been enough, said an MTA board member, which has added to financial stress. One way the MTA receives funding, the payroll tax (a percentage of income from libraries, businesses, and the like), has been cut back by state legislators.

And the “number one risk,” said Lhota, is a pending labor agreement with Transit Workers Union 100. The budget forecasts three straight “net-zero” agreements, which means TWU workers could only get raises if the cost was, according to an MTA release, “offset by changes to costly work rules or increases to employee health care contributions.”

TWU 100 didn’t return a phone call before press deadline.

Lhota said the two sides are negotiating. “We are inching forward and I’m optimistic we’ll get it done sometime this year.”

Two TWU 100 members at the meeting called for rehiring all station agents previously let go.

Overall, though, the public on Wednesday seemed pleased with the MTA, mostly because of the service restorations.

“We believe the restoration of the B48 shows that someone’s listening, and when we appointed the new head [Lhota], he stated that he would listen, he would analyze, and he would be on the ground to hear concerns of people, so I appreciate you for doing so,” said state Sen. Eric Adams, relaying feedback from his constituents.

“That’s why I wanted this job,” Lhota told reporters after the meeting. “To make a difference.”

Public hearings will be held on extending the G line to Church Avenue permanently and the proposed fare raises in November. The final 2013 budget will be approved in December.

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