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PCAC Testimony – Nov 10, 2008 – MTA Finances

MTA Board Committee on Finance – Special Meeting
November 10, 2008

We are here today to hear the latest estimates of the MTA’s future revenues and expenses. While we have not yet viewed today’s presentation, the members of the PCAC recognize that the MTA’s financial position is grave. The people of the MTA region recognize that decisive action must be taken to safeguard the future of our transportation system and of our region. The seriousness of the financial crisis that faces the MTA, however, cannot lead us to act contrary to the long term interest of the MTA system, its riders, and the region as a whole.

The PCAC opposes any reductions in transit service that are not justifiable by reasonable level-of-service standards. We maintain that cuts in service generate small cost savings in comparison with the pain that they inflict upon the riding public and the damage that they do to the local and regional economy. Because of the substantial fixed costs incurred by the MTA and its operating agencies regardless of the level of service provided, reducing service is not an efficient means of balancing the budget.

Ridership on the MTA services has risen to levels not seen in many years, and in some cases has risen to an all time high. This growth has been dramatic, but there have been only modest increases in service provided as a response to ridership increases. While declining employment will doubtless affect ridership growth, MTA trains and buses are already bursting at the seams in many locations and we cannot reasonably bear reductions in service even if ridership growth ends. In addition, in times of economic hardship the people of this region depend on public transportation even more greatly than in times of prosperity. It is particularly important now that we act to maintain affordable travel options.

We recognize that resolving the MTA’s financial crisis will require sacrifice. We adamantly insist, however, that riders not be saddled with a disproportionate share of this sacrifice. The MTA and its operating agencies have always been financed through a partnership among those who benefit from public transportation in the region. The riders certainly will do their part, but so should employers, property owners, street and highway users, other transportation providers, contractors, and suppliers. Our regional and state economy profits from countless direct and indirect impacts of the MTA system and all who benefit have a responsibility to provide for the system.

The solution to the MTA’s financial dilemma must be a broad-based answer that accounts for these benefits and their recipients. In crafting a solution to the present financial crisis we must recognize that users of MTA services already pay a higher percentage of the cost of system operation than riders in any major transit system in the nation. While we understand that the system’s users will have to pay more, we reject any proposal that calls on riders to increase the share of the cost of system operation that we bear.

Finally, the MTA itself must shoulder some of the necessary sacrifice. The MTA must continue to work diligently to increase the efficiency of its operations. It is necessary, however, to distinguish between increasing efficiency and destroying capability. There is a difference between reducing fat and cutting muscle and bone. At this critical point in our history, we need a transportation system that remains a key element in our region’s economic competitiveness and is prepared to and capable of supporting a return to prosperity.