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February 18, 2021
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Amidst Financial Crisis, MTA Urges Swift Passage of the American Rescue Plan and Calls on Congress to Deliver $8 Billion in Federal Relief |
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MTA Continues to Face $8 Billion Deficit Through 2024 from Drastically Reduced Revenue and Increased Expenses as a Result of the COVID-19 Pandemic
MTA Board Adopts Toll Increase to Take Effect in April; Resident Discount Programs Preserved
With Improving Financial Results, MTA Avoids ‘Worst Case’ Service Cuts in 2021 and 2022; Additional ‘Worst Case’ Reductions Remain on the Table in 2023, 2024 Without Future Federal Aid
The Metropolitan Transportation Authority (MTA) today urged Congress to quickly pass the American Rescue Plan, including delivering an additional $8 billion in federal relief for the agency amidst its ongoing financial crisis. The MTA continues to face a cumulative deficit of $8 billion through 2024 and is urgently requesting additional Federal assistance to power the region’s recovery from the pandemic in the years to come. To continue to provide as much subway, bus and commuter rail service as possible to customers, the MTA Board today approved a toll increase on MTA Bridges and Tunnels while preserving the resident discount programs.
As a result of recent modest financial gains, the MTA will avoid the “worst case” service reductions that had been eliminated in 2021 but had been discussed as a possibility for 2022, as well as any immediate associated layoffs. Drastic service reductions remain on the table, however, for 2023 and 2024 without future federal aid to support the remaining $8 billion deficit. This short-term stability was a result of $2.9 billion in deficit financing through the Federal Municipal Liquidity Facility, improved re-estimates in dedicated taxes and fees as well as the receipt of $4 billion in Federal aid through the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 (CRRSAA) that was passed by Congress in December.
“The Federal funding provided by Congress in December – that was made possible by the advocacy of Majority Leader Schumer and the entire New York delegation – has allowed the MTA to avoid the worst case cuts not just in 2021 but also 2022,” said MTA Chairman and CEO Patrick J. Foye. “But the pandemic is projected to continue to wreak havoc on the MTA’s finances for the next four years as ridership gradually rebuilds. We continue to urgently request $8 billion in additional Federal aid as part of the American Rescue Plan so we can serve as the economic engine leading New York’s recovery from this devastating pandemic.”
“The MTA agencies have generated $500 million in critically needed new annual recurring savings, but our financial picture remains extremely challenging,” said MTA Chief Financial Officer Robert Foran. “We have avoided worst-case service cuts in 2021 and 2022, but this remains the most difficult financial challenge the MTA has faced – an order of magnitude worse than anything the agency has ever faced in its history.”
Compared with the 2021 Budget and 2021-2024 Financial Plan that was announced in November and adopted by the MTA Board in December, the MTA anticipates $1.15 billion in additional resources. This improvement is the result of four major factors that are partially offset by three significant setbacks. The improvements are an anticipated additional $550 million in subsidies from the State of New York, an unused 2020 general reserve of $170 million, an end-of-year cash balance from 2020 that was $514 million more than had been anticipated, an increase of $268 million in other subsidies, and debt service costs reduced by $66 million. These are offset by a remaining federal need of $500 million following the passage of the CRRSAA, MTA cost savings that are $92 million lower than had been estimated, and a delay in the 2021 fare/toll increases reducing revenue by $32 million. The MTA predicts a gradual return to normal ridership levels, with increases in 2021 and 2022 leading to a “new normal” ridership that stabilizes in 2023 and 2024 between 80% and 92% of pre-pandemic levels. Toll Increases, Resident Discount Programs Preserved and the Creation of New Mid-Tier Rate for New York Customer Service Center (NYCSC) E-ZPass Users Not Using Their Tags Properly
The financial plan detailed today anticipates that the MTA will generate additional revenue through an increase in toll rates at its nine bridges and tunnels that will take effect in April and is expected to raise $62 million in 2021 and $116 million annually as of 2022, the first full year it is in place. Continuing the pattern of regular toll increases every other year that has been in place since 2009, the MTA Board today approved the increase, which will raise current tolls rates by an average of 7.08% to yield a 6% increase in revenue and preserves the resident discount programs.
Toll discount programs and rebates for Rockaway and Broad Channel residents using the Cross Bay Bridge are being maintained for those who properly use their NYCSC E-ZPass tags. The Cross Bay Bridge and Marine Parkway Bridge toll for Rockaway and Broad Channel residents will increase to $1.60. The Cross Bay Bridge toll remains fully rebated for Rockaway and Broad Channel residents properly using their NYCSC E-ZPass.
For those who properly use their NYCSC E-ZPass tags, the toll discount programs and rebates for Staten Island residents using the Verrazzano-Narrows Bridge are being expanded by MTA to provide the same discount plan regardless of the number of trips made per month. The marginal increase to the base toll will be the first since 2013 and is below the inflation rate since that time.
The Board also approved the creation of a new mid-tier toll rate for motorists who are NYCSC E-ZPass holders but are nevertheless tolled via license plate because they are not using their E-ZPass tags properly. Motorists with NYCSC E-ZPass who properly use their tags will continue to get the lowest rate. Motorists who hold NYCSC E-ZPass accounts, but who do not properly use their E-ZPass tag at the time they cross an MTA bridge or tunnel will be now be charged a special rate that is lower than the Tolls by Mail rate, but higher than they would be charged had they properly used their E-ZPass tag. NYCSC E-ZPass customers who are charged this mid-tier rate can help ensure they get an even better rate by properly mounting their E-ZPass tag (for most cars this means affixing it to the middle of the windshield, just below the rear-view mirror mount).
“Affixing your E-ZPass correctly is important because it ensures that your E-ZPass will be read as you pass through our facilities, and it can save you money if you’re a NYCSC customer,” said Daniel F. DeCrescenzo Jr., President of MTA Bridges and Tunnels. “Tracking down motorists by license plate is a process filled with back-office labor and expenses that amounted to $4.9 million in 2019. We hope the new three-tiered toll structure will encourage all E-ZPass users to affix their tags properly to ensure they get the best toll rate.”
The new rates for motorists to take effect in April are below:
Toll rates for trucks, buses and motorcycles will be posted online at MTA.info.
The MTA Board approved elimination of a little-used program that had offered discounted toll rates for registered carpooling motorists who used the Verrazzano-Narrows Bridge and lived in Staten Island. Elimination of the program, which was costly to manage and had been designed for the previous tolling environment involving toll booths and stop-and-go traffic, will save $1.4 million in expenses per year.
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