Gotham Gazette

The Place for New York Policy and politics

Topics

MTA's On the Wrong Track


 

In the wake of the Enron and Worldcom scandals, a reasonable expectation could be that the Metropolitan Transportation Authority – a quasi-corporate entity with an annual budget of $7 billion – would have learned a thing or two about the dangers of shoddy accounting practices.

Unfortunately, recent audits by City Comptroller William Thompson and State Comptroller Alan Hevesi suggest otherwise.

With the revelations that the transit authority secretly kept two sets of books, one for public and another for internal use, and also hid more than $500 million in order to justify higher bus and subway fares, the MTA is now caught in its worst crisis of public confidence in its 35 year history.

Over the years, the MTA has not given the people of this city much reason to think that we are treated fairly. After all, we move about 84 percent of the transit riders in New York State, but we receive only 63 percent of all state aid for mass transportation. At a time when the city is being forced to cut back on basic services like fire and police, this costs us more than $300 million a year.

But now public opinion threatens to turn even more forcefully against the MTA. As one straphanger from the Bronx put it, “They’re always going to cheat us. We’re always going to get a raw deal out of it.”

Such feelings are understandable – but they should not go unchallenged. The MTA should face up to its crisis of confidence and take concrete steps to win back the public’s trust, both for their own sake and also for the sake of the city. For all its problems, the MTA performs a vital service and we need it to be strong in order to finish essential projects like the transit hub at Ground Zero and the 2nd Avenue Subway.

As the person primarily in charge of appointing officials to the MTA, Governor George Pataki also shares in the blame for this crisis of public confidence. Throughout his re-election campaign last year, he maintained that no fare hike would be necessary. Immediately after the election, however, the MTA suddenly announced that it faced a two-year deficit of nearly $3 billion and would have to raise fares in order to close it.

To address this crisis and restore the public’s confidence, the MTA should take three steps.

First, give New York City its fair share of state aid for public transportation. We pay far too much to the state in terms of taxes when you compare the amount we get back in services. This must end.

Second, shed light on its finances. In order for New Yorkers to feel that they are not being cheated, the MTA must submit to a full airing of their accounts. This is only fair given that they are asking subway and bus riders to plunk down more of their hard earned cash.

Third, the MTA should postpone the fare hike scheduled to begin on May 4 as a good faith gesture to New Yorkers.

For its own sake, the MTA should take these very reasonable steps. Public institutions work best when they are trusted by the people. And right now, the MTA has a great deal of work to do in order to repair that trust.

New York City Councilmember John Liu represents the district 20 in Queens and chairs the transportation committee.

RELATED ARTICLES:

The Fare Hike Mess by Bruce Schaller
The MTA’s Numbers Don’t Add Up by New York City Comptroller William C. Thompson Jr.

The MTA's Numbers Don't Add Up


 

The Metropolitan Transportation Authority is facing a crisis of credibility. In just a few days, subway and bus riders will be hit with the largest fare hike in history. Earlier this year, when talk of a fare hike was growing, I urged the MTA to delay consideration of an increase and open its books – so all New Yorkers could know if such an increase was necessary.

Had the MTA heeded my call, their integrity would not be in question.

After three months of analyzing the New York City Transit Authority’s finances, I have concluded that the MTA has broken its public trust and misled New Yorkers with unclear and inaccurate reporting of its financial position.

The issue is clear: Straphangers should not be asked to accept a fare hike without accurate evidence detailing its necessity. That is currently not the case. We have found that the books used by the MTA’s Board to determine the need for an increase were incomplete, misleading and obfuscating. There is simply no way these books could have provided the board with the basis for sound policy making.

My audit made five key findings:

• Specifically, it found an undisclosed $300 million account that was characterized as an “investment pool.” What this money was for, how it was spent and when it was spent remains a mystery, because the MTA refused to disclose this information.

• Furthermore, the Transit Authority’s numbers just did not add up. For example, in 2001 and 2002 financial reports, the Transit Authority overstated its operating expenses by more than $850 million. This kind of accounting error gave the impression that the authority’s operating deficit was actually larger than it was – and exaggerated the need for a fare hike.

• The Transit Authority’s 2003 operating budget proposal was woefully incomplete. It lacked basic, critical information, such as the costs associated with the recent collective bargaining agreement and the additional revenues that transit officials believed a fare hike would produce. Conveniently, the board voted to approve a revised budget that included this information three weeks after approving the fare increase. The agency even tripped over its own numbers. The proposal contained conflicting deficits – on one page it put the deficit at $1.632 billion and, on another, $2.009 billion. The public, elected officials, and the MTA Board put their faith in a document that told two different stories.

• The Transit Authority overestimated the drop in ridership due to the fare increase, contrary to its own historical data. This served to deflate future revenues and further justified their call for a 33 percent fare hike.

• My audit confirmed that New York City subway riders get shortchanged by paying a larger share of their system’s budget compared to their suburban counterparts, who ride the MTA’s commuter lines.

The MTA Board should re-examine the need for an increase, this time using clear and accurate financial information. At least then, all New Yorkers could be confident that a hike of this magnitude, while painful, may also be necessary.
Yet there is a larger issue at stake. We need to change the culture that leads transit officials to believe that the system belongs to them – and that they are accountable to no one.

The city’s transportation system belongs to the people. The people have a right to understand its finances and make judgements about its policies. It is the responsibility of the MTA to ensure that it answers not only to its board but also to the public and their elected officials.

William C. Thompson, Jr. is the Comptroller of the City of New York

 

RELATED ARTICLES:

The Fare Hike Mess by Bruce Schaller
The MTA’s On The Wrong Track by Councilmember John Liu, chair of the transportation committee.

The MTA's Numbers Don't Add Up


The Metropolitan Transportation Authority is facing a crisis of credibility. In just a few days, subway and bus riders will be hit with the largest fare hike in history. Earlier this year, when talk of a fare hike was growing, I urged the MTA to delay consideration of an increase and open its books – so all New Yorkers could know if such an increase was necessary.

Had the MTA heeded my call, their integrity would not be in question.

After three months of analyzing the New York City Transit Authority’s finances, I have concluded that the MTA has broken its public trust and misled New Yorkers with unclear and inaccurate reporting of its financial position.

The issue is clear: Straphangers should not be asked to accept a fare hike without accurate evidence detailing its necessity. That is currently not the case. We have found that the books used by the MTA’s Board to determine the need for an increase were incomplete, misleading and obfuscating. There is simply no way these books could have provided the board with the basis for sound policy making.

My audit made five key findings:

• Specifically, it found an undisclosed $300 million account that was characterized as an “investment pool.” What this money was for, how it was spent and when it was spent remains a mystery, because the MTA refused to disclose this information.

• Furthermore, the Transit Authority’s numbers just did not add up. For example, in 2001 and 2002 financial reports, the Transit Authority overstated its operating expenses by more than $850 million. This kind of accounting error gave the impression that the authority’s operating deficit was actually larger than it was – and exaggerated the need for a fare hike.

• The Transit Authority’s 2003 operating budget proposal was woefully incomplete. It lacked basic, critical information, such as the costs associated with the recent collective bargaining agreement and the additional revenues that transit officials believed a fare hike would produce. Conveniently, the board voted to approve a revised budget that included this information three weeks after approving the fare increase. The agency even tripped over its own numbers. The proposal contained conflicting deficits – on one page it put the deficit at $1.632 billion and, on another, $2.009 billion. The public, elected officials, and the MTA Board put their faith in a document that told two different stories.

• The Transit Authority overestimated the drop in ridership due to the fare increase, contrary to its own historical data. This served to deflate future revenues and further justified their call for a 33 percent fare hike.

• My audit confirmed that New York City subway riders get shortchanged by paying a larger share of their system’s budget compared to their suburban counterparts, who ride the MTA’s commuter lines.

The MTA Board should re-examine the need for an increase, this time using clear and accurate financial information. At least then, all New Yorkers could be confident that a hike of this magnitude, while painful, may also be necessary.
Yet there is a larger issue at stake. We need to change the culture that leads transit officials to believe that the system belongs to them – and that they are accountable to no one.

The city’s transportation system belongs to the people. The people have a right to understand its finances and make judgements about its policies. It is the responsibility of the MTA to ensure that it answers not only to its board but also to the public and their elected officials.

William C. Thompson, Jr. is the Comptroller of the City of New York

 

Responding To The Terrorist Threat


With the government’s official “threat level” up a notch and the war in Iraq under way, New Yorkers know they are potential targets of international terrorists. Transportation facilities such as the region’s airports, the city’s subway system, Grand Central Terminal, seaports and ferry boats rank high on the list of potential targets.

How unnerved should New Yorkers feel about the threat as they move about the city? How comforted should they feel from the extensive measures the authorities are taking?

Answering these questions is very difficult. Since terrorists value surprise, they often strike at times and places that people do not expect. In addition, police and security officials are understandably secretive about their diagnosis of the risks and the steps they are taking.

Nevertheless, published news reports show that the New York Police Department’s strategy is focused on international terrorist threats such as that posed by al-Qaeda. This threat is characterized by very carefully planned attacks. Therefore, the department dispatches heavily armed police officers day and night throughout the city in unpredictable patterns. The department’s aim is to disrupt terrorists’ reconnaissance and planning efforts. Police Commissioner Ray Kelly explained the strategy on CBS’s 60 Minutes, saying, “We know that any change in the security pattern can be disruptive of their plans. So if you change the pattern of normal security or normal enforcement, we believe that can be disconcerting and disruptive.” For the same reason, checkpoints are established without warning at bridges, tunnels and highway exits, where vehicles are tested for radioactive material.

These steps illustrate the deterrence part of Kelly’s strategy. Equally important are monitoring and reporting. The NYPD has set up posts in Tel Aviv, London and Lyons, France, to monitor overseas threats. A command post in the city monitors foreign television reports. Within the city, the police department monitors video images from 100 cameras at landmarks, bridges, tunnels and the subway system.

The public is also asked to be involved. The Metropolitan Transportation Authority is running an advertising campaign with the headline, “If you see something, say something.” As the New York Times reported, focus groups shown the ad felt that they would know what “something” is if they saw it. People are taking the cue. The police department is now getting 100 to 150 tips about suspicious activity a day, up from 30 to 40 calls per day before the war began.

Internally to the transit system, New York City Transit has put 2,500 front-line employees like token clerks through a two-hour training session with a focus on “Identify, Notify and Evacuate,” reports the Queens Times-Ledger. (Newsday reports, however, that some subway workers objected to receiving an abbreviated 20 minute version that instructed workers to flee rather than help passengers in case of an attack.)

Another aspect to the strategy is presence. The police department’s anti terrorism task force has over 1,000 police officers, many of whom patrol the subways, some with bomb-sniffing dogs. Seven hundred National Guard troops and New York State troopers have been deployed to transportation sites in New York State that include Grand Central Terminal and commuter trains. Ferry boats are carrying armed escorts to ward off suicide attacks. And as any air traveler knows, every bag is now run through a $1 million scanner or swabbed for explosive traces, or both, and some travelers are asked to take off their shoes when passing through security.

”Tightening the protective net around New York City,” Commissioner Kelly’s declared goal, is a costly enterprise, with the city’s Operation Atlas costing an already budget-strapped city government $5 million a week.

Sometimes it seems to pay off. The Williamsburg Bridge was closed from 8 a.m. until 10:20 a.m. on March 28 after three men were seen on top of the bridge. It turned out they had spent the night drinking and somehow decided that climbing the bridge cables would be a suitable capstone to the evening. Mayor Bloomberg said the situation showed the effectiveness of the city’s heightened alert for potential terrorists.

But authorities cannot be everywhere and security appears to lag in some areas. The New York Times reported that only two percent to three percent of the millions of truck-size shipping containers arriving in New York harbor each year are inspected -- "just a slight increase from before Sept. 11.”

The public seems both unnerved and reassured. In press interviews, randomly chosen members of the public express appreciation for the efforts to protect the city. But they also recognize the perceived threat. Interviewed at Grand Central Terminal by the Christian Science Monitor, John Pena commented, "I saw military guys with machine guns in the mezzanine. To some degree it makes me feel safe, but also, not safe at all."

In a USA Today poll, 78 percent of air travelers said they feel safer as a result of the efforts to tighten airport security. About the same percentage said they are growing accustomed to enhanced airport security and do not mind it.

They might not feel safe if they thought about shoulder-fired missiles. Shoulder-fired missiles can be launched from as far away as 30 miles and reach altitudes of up to 18,000 feet. Heat-seeking technology directs the missiles toward an aircraft. The weapons weigh 35 pounds and typically cost $25,000 to $80,000 each. American intelligence and law enforcement agencies say that al-Qaeda and affiliated terrorist groups are thought to have an arsenal overseas of dozens of shoulder-fired missiles, some left over from the American-backed guerrilla effort in Afghanistan in the 1980s.

The Washington Post reported that in May, a Russian-built SA-7 missile was fired at a U.S. military plane taking off from an air base in Saudi Arabia. It missed. In November, two similar missiles nearly hit an airliner full of Israeli tourists after it took off in Mombasa, Kenya. The Transportation Security Administration administrator said that the Kenya incident "was outside the confines of the normal 'combat zone' and underscores how this threat has grown and now must be taken very seriously, everywhere."

Another newspaper, the Sun-Sentinel of southern Florida, reported that federal inspections showed that several of the nation's largest airports would be vulnerable to attack by terrorists using shoulder-fired missiles. A spokesman for the Port Authority of New York and New Jersey, which manages Kennedy, La Guardia and Newark Liberty International airports, said it was aware of the missile threat and was responding to it, but would not discuss any details of its security planning.

Threats like heat-seeking shoulder missiles illustrate how difficult it is for the city to protect its transportation networks. Yet they may also suggest a reason not to be unnerved all the time. International terrorists go after high visibility targets. They went back to the Trade Center after failing to topple it with a bomb in 1993. Most of us, standing on our neighborhood subway platform, are probably pretty safe, after all.

Bruce Schaller is Principal of Schaller Consulting, which provides research and analysis to government, business and non-profit groups seeking to identify and meet customer needs in the transportation sector. He is also a Visiting Scholar at the Center for Transportation Policy and Management at New York University.

The Two Dollar Fare


 

Transit officials approved an increase in subway and bus fares for the same reason that Jesse James once visited banks: they needed the money. The Metropolitan Transportation Authority expects the fare increase to generate over $350 million a year, helping to close a billion dollar budget shortfall.

Prior to the fare increase, the MTA faced sharp criticism from newspaper editorial boards, transit advocates and even the city and state comptrollers for not fully disclosing its finances and demonstrating the need for the fare increase. But there was no broad public uprising against the fare increase, which upped the cost of a single ride by 33 percent, from $1.50 to $2.00. The new fare takes effect on May 1.

One reason for the relative public quiescence is a widespread view that avoiding cuts in transit services is more important than avoiding a fare increase. Riders would rather have their pocketbooks squeezed than be any more squeezed while riding subways and buses. This preference partly reflects how crowded the transit system has become with rapid ridership growth over the past half-dozen years. It also reflects memories of cutbacks three decades ago that led to a downward spiral in both service and ridership. In fact, the public complained far more extensively about the proposed closing of 177 token booths and cutbacks in their staffing, and the authority backed off of that proposal; it now plans to close just 62 token booths instead, the biggest change from the MTA's initial proposals.

Another factor in the public receptivity to a fare increase is the MetroCard fare incentives. Riders have saved millions of dollars as a result of the various fare discounts implemented in the mid to late-90s. The MTA points out that even with this fare increase, the average fare will still be lower than it was after the last fare increase -- $1.30 per ride after this increase compared with $1.38 in 1995.

A third factor is the passage of time. With almost eight years since the last fare increase, many riders figured that their time has come.

Since this was the first fare increase since the fare discounts were put in place, transit officials faced important decisions about the structure of the new fare. They chose to make incremental extensions to the fare innovations begun in the mid-1990s. Most notably, the 30-day unlimited ride pass will be more attractive. At a price of $70, the 30-day pass will be 42 times the cost of a bonus per-ride MetroCard, down from 46 times under current fares. Riders will save money with the 30-day pass if they use transit in order to commute and an occasional additional trip.

The new fare also increases the discount for bonus MetroCards. Currently, riders get 11 trips for the price of 10, making the effective cost per trip $1.36 instead of $1.50. The new fare introduces a 6-for-5 bonus (or 12 for 10), making the per-trip cost $1.66 instead of $2.00. The threshold for getting the bonus is also reduced from $15 to $10.

The one area where transit officials backed away from MetroCard discounts came with the one-day pass. This so-called "Fun Pass" is becoming a more expensive lark, rising from $4 to $7. Some officials considered the $4 Fun Pass to be underpriced when it was first introduced. It is also used fraudulently by enterprising folks who buy several passes and re-sell trips to people at subway turnstiles. The new $7 price makes that fraud a little less profitable.

The new fare also incrementally addresses issues raised by transit advocates who sought to make the MetroCard discounts more accessible to a wider range of riders. Reducing the threshold for getting the bonus to $10 is one step in this area. Another step is the MTA's plan to begin offering this fall to replace lost or stolen 30-day passes for an unspecified "insurance" fee.

Another innovative step is a pilot "City fare" on the commuter railroads for off-peak travel in the city. Riders will be able to travel within the five boroughs on the railroads for $2.50, thus opening additional opportunities for rail travel.

Even with these steps forward, the effects of the new fare are likely to be regressive across income groups. Low-income riders are the group most likely to pay the base fare, which will cost 33 percent more. High-income riders are the group most likely to buy the 30-day pass, the cost of which increases by only 11 percent.

The overall fare increase for transit riders is 25 percent, the same as for the commuter railroads. Drivers will be less affected by the MTA actions since bridge and tunnel tolls are increasing by only 15 percent.

The new fare is likely to affect individual riders in several ways. First, a fare increase always reduces ridership - the MTA estimates by more than 70 million annually for this increase. The subways and buses are likely to be a little less crowded as a result.

Second, riders will be recalculating what they want to purchase. It may make sense to buy a 30-day card instead of a 7-day card. The $70 is a large up-front cost but the savings will be larger. For those not buying a pass, it will make even more sense to take advantage of the bonus, which will be twice as large and available for smaller purchases.

A RECAP OF THE KEY NUMBERS

Base fare: $2.00 instead of $1.50

Bonus MetroCards: 6 rides for $10 instead of 11 rides for $15 (or $1.67 per trip instead of $1.36)

7-day pass: $21 instead of $17 (you save money with the 7-day pass compared with the bonus MetroCard if you make 13 trips a week - no change from the current situation)

30-day pass: $70 instead of $63 (you save money with the 30-day pass compared with the bonus MetroCard if you make 43 trips a month, down from 47 trips currently)

One-day pass: $7 instead of $4 (you save money with the one-day pass compared with the bonus MetroCard if you make 5 trips a day, up from 3 trips currently)

Bruce Schaller is Principal of Schaller Consulting, which provides research and analysis to government, business and non-profit groups seeking to identify and meet customer needs in the transportation sector. He is also a Visiting Scholar at the Center for Transportation Policy and Management at New York University.

The Two Dollar Fare


 

Transit officials approved an increase in subway and bus fares for the same reason that Jesse James once visited banks: they needed the money. The Metropolitan Transportation Authority expects the fare increase to generate over $350 million a year, helping to close a billion dollar budget shortfall.

Prior to the fare increase, the MTA faced sharp criticism from newspaper editorial boards, transit advocates and even the city and state comptrollers for not fully disclosing its finances and demonstrating the need for the fare increase. But there was no broad public uprising against the fare increase, which upped the cost of a single ride by 33 percent, from $1.50 to $2.00. The new fare takes effect on May 1.

One reason for the relative public quiescence is a widespread view that avoiding cuts in transit services is more important than avoiding a fare increase. Riders would rather have their pocketbooks squeezed than be any more squeezed while riding subways and buses. This preference partly reflects how crowded the transit system has become with rapid ridership growth over the past half-dozen years. It also reflects memories of cutbacks three decades ago that led to a downward spiral in both service and ridership. In fact, the public complained far more extensively about the proposed closing of 177 token booths and cutbacks in their staffing, and the authority backed off of that proposal; it now plans to close just 62 token booths instead, the biggest change from the MTA's initial proposals.

Another factor in the public receptivity to a fare increase is the MetroCard fare incentives. Riders have saved millions of dollars as a result of the various fare discounts implemented in the mid to late-90s. The MTA points out that even with this fare increase, the average fare will still be lower than it was after the last fare increase -- $1.30 per ride after this increase compared with $1.38 in 1995.

A third factor is the passage of time. With almost eight years since the last fare increase, many riders figured that their time has come.

Since this was the first fare increase since the fare discounts were put in place, transit officials faced important decisions about the structure of the new fare. They chose to make incremental extensions to the fare innovations begun in the mid-1990s. Most notably, the 30-day unlimited ride pass will be more attractive. At a price of $70, the 30-day pass will be 42 times the cost of a bonus per-ride MetroCard, down from 46 times under current fares. Riders will save money with the 30-day pass if they use transit in order to commute and an occasional additional trip.

The new fare also increases the discount for bonus MetroCards. Currently, riders get 11 trips for the price of 10, making the effective cost per trip $1.36 instead of $1.50. The new fare introduces a 6-for-5 bonus (or 12 for 10), making the per-trip cost $1.66 instead of $2.00. The threshold for getting the bonus is also reduced from $15 to $10.

The one area where transit officials backed away from MetroCard discounts came with the one-day pass. This so-called "Fun Pass" is becoming a more expensive lark, rising from $4 to $7. Some officials considered the $4 Fun Pass to be underpriced when it was first introduced. It is also used fraudulently by enterprising folks who buy several passes and re-sell trips to people at subway turnstiles. The new $7 price makes that fraud a little less profitable.

The new fare also incrementally addresses issues raised by transit advocates who sought to make the MetroCard discounts more accessible to a wider range of riders. Reducing the threshold for getting the bonus to $10 is one step in this area. Another step is the MTA's plan to begin offering this fall to replace lost or stolen 30-day passes for an unspecified "insurance" fee.

Another innovative step is a pilot "City fare" on the commuter railroads for off-peak travel in the city. Riders will be able to travel within the five boroughs on the railroads for $2.50, thus opening additional opportunities for rail travel.

Even with these steps forward, the effects of the new fare are likely to be regressive across income groups. Low-income riders are the group most likely to pay the base fare, which will cost 33 percent more. High-income riders are the group most likely to buy the 30-day pass, the cost of which increases by only 11 percent.

The overall fare increase for transit riders is 25 percent, the same as for the commuter railroads. Drivers will be less affected by the MTA actions since bridge and tunnel tolls are increasing by only 15 percent.

The new fare is likely to affect individual riders in several ways. First, a fare increase always reduces ridership - the MTA estimates by more than 70 million annually for this increase. The subways and buses are likely to be a little less crowded as a result.

Second, riders will be recalculating what they want to purchase. It may make sense to buy a 30-day card instead of a 7-day card. The $70 is a large up-front cost but the savings will be larger. For those not buying a pass, it will make even more sense to take advantage of the bonus, which will be twice as large and available for smaller purchases.

A RECAP OF THE KEY NUMBERS

Base fare: $2.00 instead of $1.50

Bonus MetroCards: 6 rides for $10 instead of 11 rides for $15 (or $1.67 per trip instead of $1.36)

7-day pass: $21 instead of $17 (you save money with the 7-day pass compared with the bonus MetroCard if you make 13 trips a week - no change from the current situation)

30-day pass: $70 instead of $63 (you save money with the 30-day pass compared with the bonus MetroCard if you make 43 trips a month, down from 47 trips currently)

One-day pass: $7 instead of $4 (you save money with the one-day pass compared with the bonus MetroCard if you make 5 trips a day, up from 3 trips currently)

Bruce Schaller is Principal of Schaller Consulting, which provides research and analysis to government, business and non-profit groups seeking to identify and meet customer needs in the transportation sector. He is also a Visiting Scholar at the Center for Transportation Policy and Management at New York University.

Token Booth Closings


Two years ago, a Brooklyn graduate student was raped on a platform at the Canal Street subway station. Police caught the assailant quickly, thanks to a token booth clerk who witnessed the attack and called for help.

Because of her gratitude to the quick-thinking clerk, the student, then 25, took the courageous step of speaking publicly about her ordeal just a few months after the attack, at a City Council hearing on a plan to close token booths. Removing clerks, she testified, would be a dangerous mistake.

"If not for the help of the token booth clerk," the student said at the July 2001 hearing, "my perpetrator would still be on the streets today."

Subway crime is down sharply in recent years but many New Yorkers still fear underground violence. That is one reason why there was a sharp outcry when New York City Transit recently announced another plan to shut down a number of token booths, this time an unprecedented number — 177, which is almost a quarter of the total — and replace them with MetroCard vending machines and high entrance/exit turnstiles. As part of the plan, some 450 clerk positions will be eliminated through attrition. In demonstrations and in a series of hearings that ended last week, residents, political leaders and community groups argued that safety and service are being sacrificed for the sake of the bottom line.

"The subways are a service industry and there's a combination of both safety and convenience that a station agent serves that cannot be duplicated by a vending machine," said Gene Russianoff, staff attorney with the Straphangers Campaign, a riders' advocacy group that has been working to preserve the booths. The proposed change, he said, "is about saving money, not serving the customers."

But transit officials say the agency's plan makes sense from almost every point of view. Yes, shutting the token booths will save $8 million for the remainder of this year and more than $20 million in 2004. But the plan, they say, could actually help deter crime in the subway while providing riders with better service. By taking clerks out of sealed, bulletproof booths and training them to help customers face-to-face, officials say that transit employees will become more responsive, whether they need to summon help or simply give directions.

What's more, replacing part-time booths with MetroCard vending machines and high entrance/exit turnstiles increases convenience by allowing more entrances to be accessible 24 hours a day.

"What we're doing is just what's done almost everywhere else in the world," Lawrence G. Reuter, the president of New York City Transit, told The New York Times recently.

PAYING MORE FOR LESS SERVICE?

The controversy over token booths has erupted at what is already a contentious time for the Metropolitan Transportation Authority, New York City Transit's parent agency. After bitter contract talks that narrowly averted a strike by the Transport Workers Union last fall, the transit agency says it faces a $1 billion deficit and must raise fares to help close it. The bus and subway fare might go up to $2.

In December, several Democratic state senators announced they would try to force the authority to open its books and threatened to establish a state oversight board to audit the MTA's finances every year. The authority, the senators said, has been unable to satisfactorily explain how it went from a surplus of $300 million to a projected deficit next year of $1 billion. Governor George Pataki has called the senators' demand partisan grandstanding.

The Metropolitan Transportation Authority released seven options for higher subway and bus fares and conducted ten public hearings in New York City and the suburbs. It calls these options "several examples indicating the range of possibilities" for fare pricing structures. The "possibilities" include raising the average fare paid by riders by 10 percent, 20 percent and 33 percent. The Metropolitan Transportation Authority projects that a 33 percent fare hike would produce $574 million more in revenue annually while reducing ridership by 110 million. On the other side of the spectrum, the 10 percent fare hikes would raise about $190 million in revenue while reducing ridership by 25 million.

Local public officials have also been quick to condemn both the fare hike and the token booth proposal, saying that people will end up paying more for less service. Several local leaders have seized on planned closings in their neighborhoods to rally constituents and to assert that the transit authority is planning on removing personnel from stations at time of heightened concern about terrorism in the subway system.

Brooklyn Borough President Marty Markowitz, for one, recently joined members of the Straphangers Campaign in handing out leaflets protesting the closings. He has issued statements castigating the transit authority.

"MetroCard vending machines, which often malfunction, can't call the police or an ambulance or help you with directions," Markowitz said. "We all realize the severity of our fiscal problems, but we should never do anything that will sacrifice the safety of our subway riders."

The current booth closing plan revives an idea floated more than a year ago, even before the Metropolitan Transportation Authority announced that it expects a deficit. The plan ended up being put on hold after a judge ruled that transit officials could not change the hours of booths without first holding hearings and putting the matter to a vote of the MTA board.

The hearings held around the city this month were part of the effort to comply with the court's wishes.

24-HOUR ENTRANCES, EMPTY STATIONS

Although every station would still have at least one 24-hour booth after the proposed closings, critics argue that the plan would diminish safety by forcing passengers who need assistance, especially the elderly and disabled, to venture through empty station corridors or along dark streets in search of an attended entrance. The blind, the elderly, the disabled and people with baby strollers or large packages would be especially affected.

The Utica Avenue station on the Brooklyn IRT (3, 4) line in Crown Heights is a case in point. At this station, New York City Transit wants to close a part-time booth at Schenectady Avenue and Eastern Parkway. By replacing the booth with vending machines and high-entrance/exit turnstiles, an entrance that now closes at 9 p.m. will be accessible around-the-clock.

But it also means that riders looking for help from a token clerk will have to walk 550 feet to Utica Avenue, almost the length of two football fields. Early this month, Brooklyn Democratic Councilmember James Davis brought a crowd to the intersection to protest the closing. Davis, a member of the council's public safety committee, complained that the closure would create both an inconvenience and a hazard.

A TOKEN CHANGE

"Token booths" underground actually predate the subway token by almost half a century. When the first IRT subway line opened, the station clerks, positioned inside ornate oak-and-brass booths, sold tickets that passengers then presented to a guard, who chopped it in half and let them enter the platform.

With the advent of the nickel-in-the-slot turnstile around World War I, the choppers disappeared and the ticket booths became simply a place to get change. The first tokens were introduced in 1953, when a fare increase to 15 cents made it impossible to pay with a single coin.

Ever since MetroCard debuted in 1994, New York City Transit has been working on ways to wean people off tokens, although officials insist that they have no plan to leave the stations completely unstaffed.

"We appreciate the significance of some token booth presence in our various stations, which is why each affected station will maintain a full-time booth in the complex," Katherine N. Lapp, the executive director and chief operating officer of the Metropolitan Transportation Authority told the City Council Transportation Committee in January. "It is also important to keep in mind, however, that the MTA's significant investment in the MetroCard and its enormously successful transition to the MetroCard as the primary fare instrument was intended to move NYC Transit into a state-of-the-art system and reduce reliance on token booths as the primary means of purchasing fare instruments."

Machines, the transit authority points out, give riders choices: they can accept ATM cards and credit cards in addition to cash and they can be programmed to operate in many languages. And by drawing riders away from tokens, they shorten lines at booths.

There are now 2,226 vending machines in the subway. According to the transit agency, almost 85 percent of riders now use MetroCard and 56 percent of them buy their cards from vending machines. Since 1999, sales at vending machines have grown 168 percent. In addition, the installation of new high entrance/exit turnstiles in tandem with the vending machines has made 93 part-time subway entrances accessible at all times.

And although some people complain about the vending machines, transit officials contend that most passengers like them. The authority says its own recent surveys indicate that 67 percent of the people who use the machines, which are designed to resemble ATMs, rate them either "excellent" or "very good."

VENDING MACHINES COMMON ELSEWHERE

Transit users in other cities might be surprised at New Yorkers' fear of booth closings. On other systems in both the U.S. and abroad, automatic fare systems and even unattended stations are common.

From day one, riders of the Washington, D.C. Metro and San Francisco's BART (Bay Area Rapid Transit), both of which opened in the 1970s, have required riders to use fare cards purchased from vending machines to enter stations. Even Calcutta's subway has relied on an automated fare system since 1994. Closer to home, the Newark City Subway (yes, Newark has a subway), which is basically an underground trolley line, has no booths either. Riders pay when they board the cars, using either cash or a ticket purchased from a machine.

And while many subway riders don't realize it, there are already five rapid transit stations in Manhattan that are completely unstaffed. Riders of the PATH system, which serves New York and the New Jersey communities of Hoboken, Jersey City, Harrison and Newark, buy fare cards from vending machines or put cash directly into the turnstiles.

There are no booths or station attendants. Closed-circuit cameras watch the platforms and stairwells and passengers can get help or information by picking up hotline phones located near entrances and exits.

NEW YORK IS 'DIFFERENT'

What other cities do, however, may not be applicable in New York, critics of the transit authority's plans say.

New York's subway, with 468 stations and six million riders a day, is among the largest in the world and it dwarfs other systems in the U.S., making it hard to patrol. Even PATH, which has unstaffed stations in Manhattan, is comparatively tiny, serving less than 300,000 riders a day.

What's more, the New York system is an old one. While subways like Washington's were designed to have bright lighting, clear sight lines and other safety features, New York's subway is a warren of twisting passageways and dark corridors, a legacy of both its age and the fact that it was cobbled together from three competing systems.

Nevertheless, even some critics believe that change is inevitable and replacing token booths could work — if it is not done hastily.

"We agree that we are probably coming to the end of the era of humans vending transit," the Straphangers Campaign's Russianoff says. "But this plan is just about budget numbers. There is no evidence that they are training people to become station agents, to handle the changeover to dealing directly with the public instead of working in a bulletproof, climate-controlled booth. So far, it's just rhetoric."

But transit officials believe that, eventually, riders and employees will find that automation actually makes their trips faster and easier. As NYC Transit President Reuter told the Times, though, it will take time to persuade people: "The skeptics are there initially, but I think they will be converted."

 

Options For The Fare Increase; Bridge And Tunnel Tolls; Transportation Plans In Lower Manhattan


 

Governor George Pataki and the Metropolitan Transportation Authority (MTA) made separate announcements in the last several weeks about the future of Lower Manhattan and increases in subway and bus fares and bridge and tunnel tolls. These announcements begin, but only begin, to show what New Yorkers can expect in these critical areas.

SUBWAY AND BUS FARES

The Metropolitan Transportation Authority released seven options for higher subway and bus fares and is now conducting ten public hearings in New York City and the suburbs. It calls these options "several examples indicating the range of possibilities" for fare pricing structures. The "possibilities" include raising the average fare paid by riders by 10 percent, 20 percent and 33 percent. The Metropolitan Transportation Authority projects that a 33 percent fare hike would produce $574 million more in revenue annually while reducing ridership by 110 million. On the other side of the spectrum, the 10 percent fare hikes would raise about $190 million in revenue while reducing ridership by 25 million.

The MTA presents variations for the first two options, most of which would encourage use of unlimited ride passes, because pass prices would increase less than the base fare. Under several options, it would make sense for workers who know they will commute to work every day to buy an unlimited ride pass -- not currently the case except for riders who make several other trips a week.

By asking the public to comment on seven different options the agency has given the public much to chew on. But it also leaves open a number of questions. It is not clear whether the authority is considering adopting any specific option, much less which one that might be. It is not even clear how much revenue the authority aims to raise through this fare increase. Finally, officials have not said whether they will give the public time to comment on a final proposed fare. It is possible that the Metropolitan Transportation Authority will both announce and approve a fare increase at the same meeting, most likely in March.

The agency's presentation also mentions several other fare innovations such as insurance against losing the 30-day card,  a new bi-weekly pass (they call it a "forthnightly") and  a new five-day pass that could be used on nonconsecutive days. These are proposals advocated by the NYPIRG Straphangers Campaign and other pro-transit groups. These proposals hold the potential to continue MetroCard fare innovations and attract more riders, thus offsetting some of the ridership loss that inevitably occurs after a fare increase. (See my report on this topic.) It is not clear whether the MTA is seriously considering these ideas, however.

BRIDGE AND TUNNEL TOLLS

While much of the focus has been on the subway and bus fare, the Metropolitan Transportation Authority  also proposed higher commuter rail fares and bridge and tunnel tolls. Under the authority's proposals, tolls for the major bridges and tunnels connecting the five boroughs would rise from $3.50 to either $3.75 or $4.00. Tolls on the smaller crossings, such as the Henry Hudson Bridge, would increase from $1.75 to $1.90 or $2.00. In both cases, the 50 cent discount for EZ-Pass users would continue.

The Tri-State Transportation Campaign countered with a report (available as a pdf file) advocating a peak-period pricing scheme in which rush hour tolls would rise to $5.00 and non-rush tolls would stay at $3.50. The peak-period tolls would follow the example of the Port Authority, which charges more during rush periods on its Hudson River crossings. The idea is that drivers should pay more when demand for crossing the bridge is highest, hopefully causing some drivers to switch to off-peak periods and relieve peak hour congestion. Tri-State's report concluded that peak-period pricing would slightly increase traffic speeds during the rush hour.

The Metropolitan Transportation Authority is unlikely to adopt peak-period tolls, however, fearing that if it did so many rush hour drivers would divert to the free city-owned bridges instead of pay the toll. This idea may have to await tolling of the free bridges, which Mayor Bloomberg has proposed to help plug the city's budget gap.

Finally, the MTA proposed to close 128 part-time and 49 full-time token booths. The token booth closings, originally floated just before the Sept. 11 attacks put this and numerous other transportation issues on hold, have received particularly sharp resistance from subway riders who fear greater crime without the watchful eyes of token clerks, and who need the clerk's assistance to buy fare media and enter or exit through the turnstiles.

LOWER MANHATTAN PLANS

Meanwhile, on February 7 Governor Pataki released his long-awaited priorities for spending $4.55 billion in federal aid to rebuild Lower Manhattan transportation facilities. (See New York Times article). Topping the governor's list are a new PATH terminal at the World Trade Center site, revamping the Fulton Street complex and its maze of subway lines, and connecting both transit terminals with an underground pedestrian concourse. These proposals would rationalize and unite the Trade Center and Fulton Street transportation hubs and create a transportation terminal with a strong identity, similar to Grand Central.

The governor's plan will also rebuild the subway terminal at South Ferry and connect the station with the Whitehall Street subway station and a new Staten Island Ferry Terminal. In the South Ferry station, the obsolete single-track 5-car station would be replaced with a 10-car, three-track, two-platform terminal. These improvements would cut down on delays on the 1/9 line and thus speed commuter access between Lower Manhattan and Penn Station, a key goal for Lower Manhattan.

These three proposals would be completed later in this decade at a cost close to $3 billion.

Several other high profile projects were mentioned on the governor's list. Some appear likely to move forward, such as work on West Street and World Trade Center site infrastructure work that is necessary to support surface transportation. On the other hand, prospects are murkier for new rail links to the region's airports and new ferry terminals around Lower Manhattan. The total cost of these projects far exceeds the funding that is currently available. A rail link to Kennedy Airport, which is strongly desired by Lower Manhattan property owners and Mayor Bloomberg, would cost $3.7 billion by itself, according to the mayor, an uphill climb in the current fiscal climate.

Bruce Schaller is Principal of Schaller Consulting, which provides research and analysis to government, business and non-profit groups seeking to identify and meet customer needs in the transportation sector. He is also a Visiting Scholar at the Center for Transportation Policy and Management at New York University.

Bringing Back The Commuter Tax


There are three good arguments for the restoration of New York City's commuter tax: history, budget stability, and basic fairness.

From 1966 to 1999, commuters shared in the city's tax burdens, at least partially. For the suburbanite with an annual salary of $100,000, the commuter tax, which was set at a mere .45 percent of wages, totaled just $450 a year.

But if the city had the tax today, it would benefit by as much as $500 million. Or, to put another way, a commuter tax would pay for all of the city's youth, senior citizen, and parks services.

It is unfair for commuters to have a virtual free ride on the essential services they use. (Some commuters pay a different tax, the unincorporated business tax.) Police, fire, sanitation, and transportation services are among the most obvious.

New York City is the economic engine of the entire metropolitan region, and it seems reasonable for the beneficiaries of the engine to pay for some of the fuel.

ALBANY'S SHARE

When it comes to taxes, New York City is at the mercy of the State Legislature and the governor. With the exception of its real property tax, the state must approve any city tax change.

The impetus for eliminating the commuter tax in 1999 came from both Democratic and Republican leaders in Albany who wanted the upper hand in a special election. Both sides saw the repeal as a way to woo suburban voters. Albany rolled over New York City and raw politics triumphed over sound fiscal policy. Democratic Speaker of the Assembly Sheldon Silver who represents lower Manhattan played a shortsighted political game and voted to repeal the commuter tax, an act that benefited only upstate voters.

What makes the repeal especially galling to many New Yorkers is that it underscores the state government's general disregard for the city.

New York City already carries a unique burden in paying for Medicaid and public assistance costs, which now exceed more than $3.5 billion a year. In much of the rest of the nation, the state government funds these items almost exclusively. Similarly, state education aid has historically denied the city its fair share based on the number of children enrolled in schools. Another recent blow to the city budget was last year's repeal of a $114 million state payment that over more than two decades had made up for revenues lost when the city's stock transfer tax was eliminated.

It is no wonder that this anti-city, nonpartisan heavy handedness in Albany has finally prompted a political response in New York City.

THE COST OF COMMUTERS

Beyond the historical and political arguments for restoration of the commuter tax is the argument that the fiscal costs to New York City of providing services to commuters ought to paid for, at least in part, by commuters themselves.

A recent report by two Hunter College economists Howard Chernick and Oleysa Tkacheva estimates that commuters cost the city between 2.2 and 3.8 percent of the city budget, or between $1.2 and $1.9 billion a year. The annual cost to the police force alone is an additional $185 million. The same report found that on average commuters earned 37 percent more than residents. The authors concluded that "the elimination of the commuter tax imposed a significant, and in our view, unfair fiscal burden on the City of New York."

With the New York State Financial Control Board, the agency that oversees the city's fiscal plans, projecting a possible budget deficit of $6 billion in 2006, the restoration of the $500 million commuter makes political and fiscal sense.

In fact, little more than a doubling of the tax to one percent would raise over $1 billion. Commuters would still be paying less than a third of the top personal income rate for residents, and they would be helping stabilize the city's budget that funds the services they use.

Glenn Pasanen, former associate director of City Project, teaches political science at Lehman College of the City University.

 

For the opposite view, see "The Tax Whose Time Has Gone," by E.J. McMahon

 

The (Proposed) Trains To The Planes


New York City is one of the few premier international cities without direct rail access to its airports. Mayor Bloomberg wants to fix that. A centerpiece of the mayor's vision for the revival of Lower Manhattan is to build rail connections between Lower Manhattan and John F. Kennedy and Newark Liberty International airports. Bloomberg believes that direct rail access is pivotal to making downtown Manhattan a global center that can compete with the likes of London, Berlin and Hong Kong.

Under Bloomberg's "Vision for Lower Manhattan" the AirTrain elevated guideway system, currently under construction by the Port Authority, would be extended from Jamaica, Queens through a new tunnel to Lower Manhattan. Under current plans, AirTrain will connect JFK terminals with each other, airport parking lots, the Howard Beach subway station and subway and Long Island Rail Road train lines in Jamaica, Queens. AirTrain's opening, scheduled for this year, has been delayed by an accident last summer that killed one worker. Extending AirTrain from Jamaica to lower Manhattan would provide air travelers with a one-seat ride (i.e., no need to transfer) from the airport to downtown, and would also connect Lower Manhattan to LIRR trains in Jamaica.

Bloomberg also proposes to extend the PATH train from Newark's Penn Station to Newark Liberty airport. This extension would provide direct rail service from Newark to a new PATH station at the World Trade Center site as well as PATH stations as far uptown as 33 Street.

Bloomberg estimates that the AirTrain extension would cost $3.7 billion and take nine years to complete. The Newark PATH extension would cost $775 million and presumably could be built more quickly than the AirTrain tunnel.

Bloomberg says that a one-seat ride between JFK and Lower Manhattan "is key to our success." The concept of a one-seat ride is attractive for many reasons. It offers faster and more reliable travel times by eliminating transfers between trains. It also offers greater convenience, especially for air travelers lugging bags. The simplicity of direct rail service also contributes to the image of a city as an easy place to visit and do business.

On the other hand, spending nearly $4 billion for a one-seat ride from JFK to Lower Manhattan offers few benefits to the much larger number of travelers originating in or bound for other parts of New York City. Air travelers using JFK come from locations throughout the metropolitan area. Although it requires the transfer in Jamaica or Howard Beach, AirTrain will let travelers reach JFK by rail from throughout the city via the subway connections and from throughout the LIRR service territory via the Jamaica LIRR connection.

In his Lower Manhattan speech, Bloomberg cited Heathrow airport's 30 minute transit access to Paddington Station in London's West End, alluding to the high-speed Heathrow Express service. What he did not point out, however, is that ridership is higher on the Piccadilly Underground line from Heathrow than on the faster Heathrow Express service, according to the 2000 Transit Cooperative Research Report, Improving Public Transportation Access to Large Airports. The Piccadilly line is slower but it serves a larger geographic area. It is also cheaper,another advantage that is particularly important to airport employees, who far outnumber air travelers at major airports such as JFK.

In comparing New York with other international cities, the mayor also raises the question of whether as many travelers can be attracted to public transportation at American airports as at airports in Europe and Asia. Rail serves 25 percent of air travelers using Heathrow Airport in London, 35 percent of travelers at Tokyo's Narita Airport, 25 percent in Hong Kong and 20 percent in Paris (DeGaulle). A substantial additional fraction of travelers take buses to the airport, ­ 15 percent in the case of Heathrow.

American cities with direct rail access have attracted much lower levels of transit ridership. The best case is Reagan National airport outside Washington, DC, where 15 percent of air travelers use the excellent Washington Metro trains. Virtually all of these travelers are domestic travelers, many of them traveling on business and going to offices or hotels close to a Metro station. The walk from the terminal to Metro is very short, Metro service is frequent and the fare is relatively cheap.

Rail's share of airport travel is much lower in other U.S. cities. Direct subway service between downtown business districts and the airport draws 12 percent of air travelers for Boston's Logan airport, eight percent for Atlanta's Hartsfield airport, eight percent for Chicago's Midway airport and four percent for O'Hare.

According to an update (in pdf format) to the Improving Public Transportation Access to Large Airports report, about four percent of air travelers from JFK use the bus to A train connection. International leisure travelers are most likely to use the A train and are easily spotted with backpacks by anyone who has traveled through Howard Beach. Despite this low ridership level, the A train carries a substantial and growing JFK ridership. About 900,000 people used the Howard Beach station entrance that connects to shuttle buses in 2001, a 125 percent increase from a decade earlier. Many of these riders are airport employees.

In many ways more promising than the expensive JFK direct rail link is the mayor's proposal to connect PATH to Newark airport. It is not clear from the mayor's speech whether he has in mind connecting PATH to Newark's AirTrain system or extending PATH trains directly to airport terminals. The Port Authority has been looking at the first option, however, which seems the more likely option although here again, it would require travelers to make a transfer between AirTrain and PATH.

Will New Yorkers ever enjoy truly direct rail access from Manhattan to any of the region's three major airports? The coming of AirTrain at JFK and possible extension of PATH to connect with the Newark airport's AirTrain would offer two-seat rail access to travelers who originate or are destined for many locations throughout the metro area. A one-seat ride is a more distant goal. But it may not be a bad thing that it is distant. The two-seat rides take advantage of the region's extensive rail infrastructure which offers access to numerous destinations with frequent and reasonably reliable service. It is not hard to argue that a two-seat ride to where you want to go is better than a one-seat ride to select locations, such as Lower Manhattan, that will serve only a thin slice of the flying public.

Bruce Schaller is Principal of Schaller Consulting, which provides research and analysis to government, business and non-profit groups seeking to identify and meet customer needs in the transportation sector. He is also a Visiting Scholar at the Center for Transportation Policy and Management at New York University.



Print Friendly and PDF

Editor's Choice


Gotham Gazette: New York Voters Approve $4.2 Billion Environmental Bond Act
New York Voters Approve $4.2 Billion Environmental Bond Act
Gotham Gazette: 
New York City Voters Approve Racial Justice Ballot Measures
New York City Voters Approve Racial Justice Ballot Measures
Gotham Gazette: 
Housing Development in New York City Slows to a Crawl as Officials Debate Tax Incentives
Housing Development in New York City Slows to a Crawl as Officials Debate Tax Incentives
Gotham Gazette: 
City Council Examines Low Voter Turnout, Moving Local Elections to Even Years City Council Examines Low Voter Turnout, Moving Local Elections to Even Years