A new report from NYC’s Independent Budget Office examines the many dedicated taxes and fees that help underwrite the health of the MTA and keep transit riders moving in downstate New York. Dedicated taxes and fees represented about 40% of the MTA’s $10.9 billion operating budget in 2010, with the rest coming from fares, tolls, and other revenues such as advertising. One of the most controversial of these taxes and fees has been the payroll mobility tax introduced in 2009. But a graph in the report underscores how important the payroll mobility tax is to the health of the region’s transit network:
The report also illustrates how the extreme volatility of another set of dedicated taxes — the property transfer taxes — has wreaked havoc on the MTA budget. During the last decade’s real estate boom, soaring tax revenues hid underlying structural budget problems at the MTA. When the recession hit, transfer tax revenues plummeted, touching off a funding crisis:
One important topic not mentioned in the report is the impact of New York’s debt-heavy plan to fund the rest of the MTA capital construction program. Most of the plan relies on new debt backed by transit fares, which will put more pressure on the operating budget and force future fare increases, service cuts, or another difficult conversation about new taxes and fees.