December 17, 2009 / 12:13 AM / in 10 years

UPDATE 2-MTA passes huge NYC service cuts to shut deficit

(Updates with MTA chairman’s response to Straphangers, adds comments from MTA board members)

By Joan Gralla

NEW YORK, Dec 16 (Reuters) - New York’s Metropolitan Transportation Authority approved drastic service cuts on Wednesday as part of its new budget to close a deficit of nearly $400 million.

The service cuts would include closing two subway lines, cutting station agents, slashing weekend and overnight service, and forcing pupils to pay for their travel to school.

But MTA Chairman Jay Walder, at a webcast board meeting, promised to review the cuts over the next few weeks to see if their impact can be reduced.

“There won’t be an answer that will take the pain away,” Walder told reporters. “We may be able to do it a little better.”

There is still a risk that subway, bus and commuter rail fares and tolls on bridges and tunnels will have to be raised this year if revenues again fall short, Walder said. Fares and tolls are scheduled to rise in 2011 and 2013.

The deficit-plagued MTA, the largest U.S. mass transit agency with about 10 million daily riders, had dodged the service cuts in the spring after a state bailout. But the state rescue unexpectedly fell short, causing a late-year deficit.

The MTA’s new budget is just the beginning of the process of slashing service. The proposed cuts are subject to public hearings before they can be put in place.

Asked if he would support other options, such as a bid by Mayor Michael Bloomberg to revive his congestion-pricing plan, Walder said his first priority was “using my position to show the taxpayers from the State of New York that we are using all of the money we receive as efficiently as possible.”

The state Legislature blocked Bloomberg’s proposal in 2008 to charge motorists an $8 fee for driving in congested areas of midtown Manhattan during peak hours.

Last month, Bloomberg, an independent, won election to a third term as mayor of New York City.

Bloomberg, who attended the global warming summit in Copenhagen, told reporters: “I don’t think that congestion pricing or those kinds of things are dead.” Next March, the state Senate might revisit the plan, he said.

Governor David Paterson, a Democrat who appointed Walder to the MTA’s top job, told Albany reporters he did not have “any specific plan” to fix the MTA’s cash crunch. He added that any revival in tax revenues should be used to ensure that pupils would not have buy Metrocards to go to school.


Walder again promised to ferret out any wasteful spending on expenses ranging from headcount to purchasing goods and services.

“There will be layoffs; we must not be afraid to eliminate work that is no longer necessary,” he said.

The agency employs about 70,000 people. Managers will take a 10 percent pay cut and 700 unionized workers will be laid off in the new plan.

“Frankly, having 5,000 people working in administration is too many,” Walder said.

The City Council, led by Democrats, and the Straphangers Campaign, a transit advocate group, said the MTA should redirect some capital money to avoid the service cuts.

Walder promised to consider this, but the MTA chairman called it the same “slippery slope” approach the MTA took in the 1970s, which caused damage to the system that he said took nearly 20 years to repair.

MTA board members found different candidates to blame for the cuts. Some, including Andrew Saul, who runs an investment firm, faulted the state government and New York City for underfunding the mass transit agency and forcing it to take on costly new projects.

Another MTA board member, Doreen Frasca, a Wall Street executive, said the city and the state resembled “two deadbeat Dads,” or fathers who fail to pay child support.

Yet others, including Nancy Shevell, a trucking company executive, blamed unionized workers for “archaic” work rules and the costly 11 percent raises an arbitrator granted transit workers over the next few years. Saul was among the MTA board members who also criticized the transit union.

In response, MTA board member Norman Brown, the legislative director of the New York State Council of Machinists, said the MTA itself had sought some of the work rules. He urged the MTA to negotiate the rules with the unions, noting it was a mistake to give that job to deputy mayors and lawyers.

Andrew Albert, another MTA board member and the executive director of the West Manhattan Chamber of Commerce, said ending the only bus links to distant subway stops will hurt some of the city’s poorest areas, summing it up this way:.

“It’s just crazy.” (Editing by Jan Paschal)

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