Resistance Grows Against Cuomo’s $40 Million ‘Transit Fund Raid’

March 3, 2014 Updated: March 3, 2014

NEW YORK—A small bullet point at the very bottom of Gov. Andrew Cuomo’s proposed transportation budget briefing is unsettling politicians and transit advocates in New York City.

In that item, the governor proposes to divert $40 million in dedicated transit funds from the Metropolitan Transportation Authority (MTA) toward repaying bonds previously issued on behalf of the MTA.

The move may seem harmless and the governor has portrayed it as such. How could it be wrong to use the MTA funds to repay MTA bonds? But the governor’s move isn’t that simple and politicians and transit advocates in New York City are up in arms, calling the diversion a “transit fund raid.”

“Instead of $80 million going to the subway system, $40 million for bonds and $40 million for operations, there would now only be $40 million,” State Assemblyman Richard Gottfried said at a press conference in Lower Manhattan Sunday. “However you slice it, it’s a $40 million cut to the transit system and that’s wrong.

Given that the MTA’s budget is in the billions, a $40 million reduction is merely a drop in the bucket. But the lawmakers said that small amount could be used to restore essential services in Queens and Brooklyn that were cut during the financial crisis. The MTA slashed $91 million in services in 2010, only half of which have been restored.

“Subway and bus riders have taken a lot of hits in recent years,” State Assemblyman Jim Brennan said. In addition to restoring services to Queens and Brooklyn, he also suggested the money could be used to hold down the cost of fares.

Queens, Brooklyn Service

The costs of the MTA bonds have been covered for about a decade from the general fund, an arrangement made when the agency was struggling in the 1990s. But last year, Cuomo diverted $20 million from the dedicated transit funds toward repaying MTA bonds. He now proposes to divert funds every year until the bonds are paid off in 2031, diverting some $350 million from the MTA budget.

“In Queens we have been devastated by the bus service reductions. The outer boroughs do not have integrated train services as well as the borough of Manhattan does. We depend on our bus services,” said Assemblyman Michael DenDekker. “Therefore, rather than sweeping the $40 million it is my hope that the governor will redirect those funds specifically to increase bus service in the borough of Queens.”

A total of 32 state assembly members signed a letter to Sheldon Silver, the speaker of the state Assembly in Albany, urging him to direct the Assembly to reject the governor’s proposal. They are hoping both the Assembly and the Senate will adopt a resolution by mid-March that could help strike the governor’s proposal from the budget.

Last year, both chambers of the state Legislature voted near-unanimously to pass a bill to create a “locked box” for transportation funds, requiring legislative action to divert money from it. Cuomo vetoed that bill.

“It takes me 40 minutes to get to the subway from where I live,” said George Christman, a transit rider and a member of the Riders Alliance, a grass-roots group advocating on behalf of New York City commuters. “With the budget cut it would mean less buses, so it would take longer to get there.” 

Follow Ivan on Twitter: @ivanpentchoukov