The agency now faces an addition $350 million deficit that could eventually go as high as $400 million. The state budget office is blaming this on falling revenue from the state payroll tax. The final numbers will be presented when the governor presents his 2010-2011 budget on February 9.
In a statement, the MTA said, "The MTA is considering a variety of cost saving and other measures in addition to those proposed in the December Plan to deal with the anticipated additional revenue shortfalls in its operating budget. MTA remains prepared to take needed actions in order to maintain a balanced budget."
Asked what exactly it means for riders, spokesman Kevin Ortiz said the situation is serious, but officials need to take a closer look at what it means.
"Service cuts are already on the table. A new set of decisions will need to be made by the MTA board," Ortiz said.
All told, the MTA is dealing with $733 million less then they thought they'd have for the 2010 fiscal year.
The increased deficit may change again when the state releases amendments to Governor Paterson's $134 billion budget on February 9. Paterson said on Wednesday that New York's budget gap next year will be 10 percent wider than projected two weeks ago because Wall Street cash bonuses are less than forecast.
Word of the new potential deficit led Moody's Investors Service to cut its rating on a portion of the MTA's $28.6 billion of bonds, which makes it more difficult for the agency to borrow money. The Straphangers Campaign is calling on MTA to use currently available federal stimulus money to keep running as much transit service as possible.
"It's also a wake-up call to press hard for a new federal jobs bill to fund subway, bus and commuter operations in a tough economy and keep people working," the Straphangers' statement said.
MTA carries 2.6 billion people annually, runs New York City's buses and subways, the Long Island and Metro-North commuter railroads, seven bridges and two tunnels.