The MTA's Dire Financial Straits

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Brian Lehrer: Brian Lehrer on WNYC. Now we turn to the MTA where historically low ridership has put the agency into a $12 billion deficit. That's the number I've seen most recently. New York City and New York State have serious deficits because of the pandemic, but the MTA's fiscal house is on fire as it awaits emergency funding from Congress, very uncertain. It's in the process of considering layoffs, fare hikes, and service cuts. Joining me now is Stephen Nessen, WNYC transit reporter. Hey, Stephen. Good morning.

Stephen Nessen: Hi, Brian, how are you?

Brian Lehrer: How bad is it?

Stephen Nessen: Like you said, it's on fire. I think the chairman of the MTA repeatedly refers to it as a fiscal tsunami which, like you mentioned, part of it is related to-- all of it is really related to the drop in ridership from the pandemic. It was historically low. It's never been as low as it was at the height of the pandemic, like in April and March where ridership was down more than 90%. They say like, even during the great depression, it was nowhere near that bad because at least people were riding at that time but this is unprecedent for the MTA and they've really dug themselves in deep here.

Like you were saying, their projected deficit going for the next four years is actually up to $16 billion now, one, six, and they're asking Congress for $12 billion to get them through the next four years. They say if that money doesn't come soon and I'm talking early next year or sooner, there's going to be some major cuts coming to our transit system in the region. It's the commuter rails, the buses, and the subways.

Brian Lehrer: I think these are your reported numbers on Gothamist. They threatened to lay off more than 9,000 employees and cut service by 40% if Congress doesn't provide $12 billion in emergency pandemic relief by the end of this year. How real do you think those numbers are and how hyperbolic to get attention?

Stephen Nessen: It's a great dream that this is hyperbolic, but the MTA has been saying this for months now, and they've been warning and maybe they put too many of their eggs in the federal basket in hopes of a bailout, in hopes that a Biden administration will solve this problem but Biden doesn't take off until January. The MTA budget for next year is due by the end of this year.

You've been following Congress like everyone else, and it doesn't appear that there's going to be a new relief bill anytime soon. If there is, it's not going to include, that we've seen anyways, $12 billion for the MTA or anywhere close to the amount of money that all the transit agencies in this country need at this moment. Those cuts are what they say they need to do to keep the lights on, to keep things running.

You said 40%, that's just for the subway. They're also talking about 50% for the commuter rail that it might even include accessing certain lines that are less frequented. It would mean on the commuter rails, riders could be waiting up to half

an hour or an hour for a train that they would normally take much every 15, 20 minutes. On the subways and the buses, that could also mean an additional 15-minute wait, if they're cutting service. Cutting service like you said, also means cutting jobs, and the union, the Transit Workers Union strongly opposes this and say they'll fight it. Though, it looks like we're in for a very messy financial struggle in the very near future.

Brian Lehrer: Of course, the cycle is that fears of COVID-19 are one of the main reasons that ridership is so low and then that affects fair revenue. Then that affects potential layoffs and service cuts. Then ridership would probably go down even more because people wouldn't feel served, but you probably saw the NYU study that just came out that found the subways are actually pretty safe in COVID-19 terms. There've been other studies like that. Have you seen this latest one? Is it clear from it, if you have seen it, that the subways are safe for reasons other than that they're being sparsely populated?

Stephen Nessen: Right. The NYU study which I saw, I wrote about yesterday, actually looked at 120 cities over the past 10 years. They were looking at influenza, the flu spread similar to COVID and found there was not a connection between cities with high public transit ridership and the number of people who died from influenza or the flu. They drew the connection that the likelihood of people contracting the flu on public transit, there wasn't necessarily a connection.

There've been other studies of SARS, for example, in Hong Kong, in Beijing, as well as studying coronavirus in Korea, I believe, that there just wasn't a connection between the virus being spread and people riding public transit. Part of the study also was saying that-- the authors were saying that the way people ride the subways, it's not like people are shouting, generally, you've been on some loud cars, I'm sure, but generally, people keep to themselves, they read, they get on, they get off, they move along.

The doors open frequently, the subways have a lot of air circulation. There's been some fear and it seems like, "Oh, my God, I'm in a controlled small space. Someone has their mask down under their nose. Oh, my God, am I going to get it?" That hasn't shown itself, it hasn't bared itself in any researcher studies or scientific findings that the subway is the main source of COVID transmission.

Brian Lehrer: Is there any tension in terms of funding between the MTA and the state of New York? Now, the governor pretty much controls the MTA, but the state has a deficit too, but it's not nearly as in an emergency situation as the MTA is. Are they asking for more money from state coffers and getting resistance?

Stephen Nessen: That is certainly one of the avenues in which the MTA could help to shore up its funding so it doesn't have to make those cuts. Actually from what we've seen is the state has actually siphoned off about $600 million from funding that should go to the MTA. You may recall last year we got a bunch of taxes-- a bunch of new revenue sources passed for the MTA, like the internet sales tax, mansion tax, things like that.

I believe in one of Cuomo's many executive orders, allowed some of that money to be used for other purposes other than just the MTA's capital plan, which is now on ice because of the pandemic. It's used for other operating things. Yes, like you said, the state controls the MTA and they have the ability to move funding wherever it's absolutely necessary, wherever they deem it needed.

Brian Lehrer: Last question, with this MTA fiscal emergency congestion pricing of fee for driving in the prime Manhattan business districts, it was supposed to help fix the MTA's budget woes was which, of course, existed to some degree before the pandemic. I'm seeing congestion pricing is on shaky ground now. What does the pandemic have to do with delaying congestion pricing?

Stephen Nessen: Congestion pricing would have helped fund all these amazing subway improvements that everyone was looking forward to before the pandemic, now with the pandemic, all of that work is on hold. Congestion pricing was in a holding pattern because of the Trump administration. They were supposed to-- a routine paperwork, rubber-stamped, like, okay, here's what you need to do to conduct an environmental review because some of the roads that would be told, were funded with federal dollars.

It was just this routine thing. It's just another way that Trump's transportation administration was able to hold off and delay some of the projects in New York. That said, once the Biden administration comes in, there's great hope that they, of course, will be more favorable, and they've been very positive on transit, public transit, and that they will do the necessary thing that the MTA needs, but then the MTA still needs at least another year.

Recently, they said it could take up to 2023 before the congestion pricing program is up and running, and it would generate a lot of money for the MTA, a billion-dollar year in tolls, which they can then use to get bonds for $15 billion. That would really help their finances right now but right now it's not going to happen [crosstalk]

Brian Lehrer: WNYC, transit reporter, Stephen Nessen. Thanks, Steve.

Stephen Nessen: Thank you.

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