MTA projects an additional shortfall

April 27, 2009 1:41:52 PM PDT
Things went from bad to worse for the Metropolitan Transportation Authority today. The MTA re-forecast its annual revenues, projecting a $621 million deficit for 2009 even after approved fare/toll increases and service cuts are implemented.

The growing deficit is due to the continuing decline in the real estate and dedicated taxes that support the MTA, all of which are economically sensitive.

In addition, increasing unemployment and higher fares led the MTA to predict a 7.2% drop in ridership for the year.

The re-forecast identified the following specific changes from the revenues assumed in the budget passed by the MTA Board in December 2008:

  • Real estate taxes: Down $336 million
  • Fare/toll revenue: Down $221 million
  • State dedicated taxes: Down $113 million
  • The picture is even bleaker for 2010, with a $1.022 billion deficit now projected, up from $290 million at the start of the year.

    "The budget that was passed in December assumed large decreases in revenue, but we now know that the reality is even worse," said Elliot G. Sander, MTA Executive Director and CEO. "With this re-forecast in hand we have begun identifying ways to fill the new gap, but there are no easy solutions."

    News of the shortfall comes as lawmakers in Albany consider a bailout for MTA.

    The Democratic Senate is scheduled to vote on a proposal this week. The Assembly's Democratic majority has a competing plan and Governor Paterson favors most parts of a program developed by an expert panel to rescue the MTA.

    Paterson is pushing back Monday against a dollar-per-ride taxi fee to raise MTA funds.

    A bailout is intended to avoid a 23-percent increase in fares for buses and subways as well as cuts in service and layoffs this summer.


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