Ravitch Commission's MTA Funding Report Released

The NY State Commission on MTA Financing, led by former MTA chair Richard Ravitch, has released its report (available on TSTC’s website) outlining a comprehensive proposal to save transit riders from the agency’s doomsday scenario, put the MTA on stable footing for years to come, and support a major capital plan — similar to the one proposed in February that would finish the MTA’s megaprojects, bring the system closer to good repair, and begin work on major improvement projects. The report also recommends major expansions of bus service throughout the region and management and government reforms to make the MTA more transparent and politically independent.

The plan outlines three main funding sources:

  • A regional “mobility tax” applied to business payrolls of 0.33% within the 12-county MTA region. The tax would raise $1.5 billion a year, which would plug the MTA’s operating deficit in 2009 and be used only for capital expenses after that. Tax revenues would go to a new Capital Financing Authority, which would assume the debt for current and future MTA expansion projects, relieving the debt pressure on the MTA’s operating budget.
  • Tolls on the East River and Harlem River bridges, which would net revenues of $600 million annually. The report recommends setting East River bridge tolls equivalent to the MTA’s other crossing tolls (currently $5) and setting the Harlem River bridge tolls at the price of a subway fare. All tolls would use high-speed, cashless collection that would not impede traffic. In doing so, the MTA would take over responsibility for maintaining the bridges from NYC (a clear benefit for the city). Revenues would go towards bridge maintenance first and then to mass transit (specifically, to expanding bus service).
  • An 8% fare and toll increase in 2009 (down from the 23% increase needed in the “doomsday” scenario). The plan also recommends automatic, bi-annual fare and toll increases based on the rate of inflation that would not be subject to public hearings (public testimony would still be heard at MTA committee and board meetings; more frequent or larger hikes would require hearings). This is the weakest part of the plan and seems to go against the spirit of the transparency reforms outlined later in the report.

Other major proposals include the creation of a regional bus authority which could take control of suburban bus systems like Long Island Bus and Westchester’s Bee-Line Bus, potentially ending the annual battles over funding and resulting in substantial service improvements for bus riders.

Transparency reforms include putting on the MTA’s website all reports by NYC’s Independent Budget Office and the state comptroller that deal with the agency, and asking the state comptroller to do a follow-up to its 2003 “two sets of books” report that would describe whether the MTA is complying with the recommendations of that report. The commission also recommends putting online up-to-date budgets for all major capital projects, and says the next capital plan should include detailed justifications for large capital projects (including the consequences of not doing them).

The commission also calls for significant changes to MTA management structure. It recommends that full executive authority be vested in the chair, which would require modifying a 2005 law separating the chair and CEO roles. In the commission’s view, a re-empowered chair would have more political independence than the current CEO, which the report compared to an agency head serving at the governor’s will. The report also recommends that board members step down within six months of the expiration of their terms and that new board members have relevant experience in transportation, finance, labor relations, or other areas of expertise.

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