New York's MTA Epitomizes Crisis in Transit (& other Essential Service Agency) Finance

Whenever we talk about the state and local fiscal crisis, we should always emphasize that it is driven by tax and FEE revenue shortfalls caused by the Greater Recession. If we fail to include the "F" word, we run the risk of reducing attention to the public enterprises on which particularly our urban economies rely.

Like many other state, regional and local essential public service authorities which are heavily or completely dependent on fee revenue, the New York State MTA is now in such dire financial straights that this authority's leadership is planning a roughly 40% reduction in train, subway and bus service. and commensurate lay-offs of workers, deepening and prolonging the Greater Recession directly and indirectly.

The NYTimes story of yesterday and the blog posting of today, by Christina Goldbaum and Juliana Kim, respectively, tell this terrible tale quite well. My colleague Institute Senior Fellow Dr. Jack Wells and research intern Zanagee Artis (Brown University /Watson Institute) are continuing to work on documenting the Greater Recession's impact on mass transit in the Northeast-Midwest states and give us a little deeper dive into this enormous problem as it emerges region-wide, but for the time being, good press coverage like this July NYTimes piece and this July Washington Post article, by reporters Pranshu Verma and Justin George, respectively, are well worth reviewing.

The supervening state and local governments' own tax and fee revenue shortfalls make it unlikely that these agencies and the toll-road, airport and other transportation authorities operating and maintaining their essential public service infrastructure can be assisted by those levels of government, although New Jersey's rail and bus transit networks operated by NJTransit, may prove to be an exception, given Governor Murphy's ambitious crisis borrowing and spending program, as reported in June by Larry Higgs of nj.com.