Wednesday, November 16, 2011

Deep cost-cutting is key to NYMTA budgets

Written by 

New York’s Metropolitan Transportation Authority has released its Final Proposed Budget for 2012 as well as an updated four-year Financial Plan.

mta_logo.jpgMTA said the plan “assumes $850 million in annual recurring savings by 2015 as a result management of actions, including reducing administrative payroll expenses, consolidating back office functions, reducing overtime costs, renegotiating contracts with suppliers, reducing the non-revenue vehicle fleet and leased office space, creating paratransit efficiencies, and rebidding the healthcare program.”

The Financial Plan includes implementation of fare and toll increases in 2013 and 2015, each designed to yield revenue increases of 7.5%, and achieving $323 million in wage savings for 2015.

MTA also on Wednesday presented an update on proposed funding the final three years of its 2010-2014 Capital Program. A final proposal will be presented to the MTA board in early 2012.

“The MTA has achieved a fragile fiscal stability by reducing expenses and operating more efficiently,” said MTA Executive Director Joseph J. Lhota. “It's clear, though, that we’re still feeling the impact of the economic crisis and must continue to reduce costs even as we work to improve service.”

“In the context of the ongoing economic crisis in New York State, this proposal advances our critical capital investments in an affordable way,” said Robert Foran, MTA chief financial officer. “It relies on revenues already dedicated to capital expenses and keeps debt service at a manageable level, with the percentage of debt to capital investment the lowest in 15 years.”