The New York Metropolitan Transportation Authority's new chairman, Jay Walder, warned at an MTA board meeting Wednesday that the agency's worsening fiscal crisis "demands that we permanently overhaul the way the MTA does business."
"The bottom line is that there is no more money for us in Albany, and we will learn to do more with the funding we have," he said.
New fare increases and work force reductions are coming, he said—it's only a question of size and timing.
MTA operates one of the world's biggest urban/suburban passenger rail systems; each day its trains move more than four million riders on New York City subways and hundreds of thousand more on the Long Island and Metro-North railroads.
Although MTA is a state agency and its chairman is appointed by the governor, the state legislature earlier this year balked at committing substantial long-term help.
At Wednesday's board meeting, which was Webcast, it was indicated that fares will rise by 7.5% in 2011 and 2013 and possibly earlier to help narrow rising budget gaps. Chief Financial Officer Gary Dellaverson said MTA would nave have to tap $150 million of reserves because the recession has caused revenue from an urban real-estate tax to fall far more steeply than anticipated.
Despite a sizeable fare increase and service cuts imposed earlier this year, MTA's farebox recovery ratios remain too low for comfort, especially in view of the vast new debt MTA is assuming as it presses ahead with such multibillion-dollar projects as the Second Avenue Subway on Manhattan's East Side, and also LIRR East Side Access to Grand Central Terminal.
MTA last week released figures showing that in this year's first eight months, subway riders paid only 34.4% of the total cost of their rides (including debt as well as operating expenses); Metro-Morth riders paid 39.2%; and LIRR riders, 28.9%.