Gotham Gazette Thu, 22 Mar 2018 00:15:01 +0000 Joomla! - Open Source Content Management en-gb (Webmaster) Congestion Pricing Train Already Running Late in Albany andrew cuomo mta columbus circle trs

photo via the Governor's office

There is plenty of debate ongoing about the pros and cons of congestion pricing - but little discussion yet about the purpose of creating such a large flow of money -- $1-$1.5 billion a year -- that logically must be a way to fund the next MTA capital plan. That plan is due out in the fall of 2019 for a five-year cycle from 2020 through 2024.

The MTA had estimated that both the existing plan (2015-19) and the prior plan (2010-14) would cost about $30 billion each. For both plans, the MTA, the Governor, and the Legislature had trouble figuring out how to raise the money to cover such immense costs, and the 2010 plan was ultimately downsized. The next cycle will have the same problem: where to find money to pay for it. In fact, the problem of paying to keep the subway, bus, and commuter rail system in a state of good repair and pay for expansion projects will continue for decades.

In October 2013 the MTA put out its 20-year Capital Needs Assessment, 2015-2034, and identified needs which would cost $106 billion (in 2012 dollars) to pay to keep the system in a state of good repair, without even considering the cost of expansion projects. The cost of the expansion projects, East Side Access, Second Avenue Subway, and the LIRR Main Track, are $7 billion in the current plan. The State of Good Repair (replacing track, signals, stations, subway cars and buses, etc.) for the existing system is $25 billion in the current plan.

Governor Cuomo, MTA Chair Joe Lhota, and the Fix NYC panel have said very little about just how problematic the MTA’s long-term funding needs really are. There is a proposal in Gov. Cuomo’s new executive budget plan to force New York City to pay half the recurring maintenance costs of Lhota’s Subway Action Plan, estimated at $300 million a year by 2020, which Mayor de Blasio is refusing to support, but that is primarily for a step-up in regular maintenance, not capital projects.

The current capital plan had a shortfall of half the needed funds, $15 billion, until the Governor and the Legislature patched up the problem in 2016 by promising in state law the MTA would get the money when it needed it, meaning it would have to spend down what it had available first.

There is still no congestion pricing bill submitted by the Governor for the Legislature to consider, although in January the Governor’s Fix NYC panel issued its report that framed a congestion pricing scenario about the same time as he released his budget. A new state budget is due by the April 1 start of next fiscal year. That means the current discussions are more about whether the Legislature will even entertain the idea of charging vehicles to enter the Manhattan business district, without considering the specifics of the charges or what to do with the money.

The Legislature will skip convening in Albany during its annual mid-February break and not return until the end of the month at which point the Assembly and Senate will develop their one-house proposals for the budget. That begins a process in March to negotiate and adopt the next state budget by the April 1 deadline. The budget itself is controversial, as usual, with the Governor seeking $1 billion in new revenue to plug the deficit, and New York City complaining that his budget plan reduces or limits state aid to the city, or forces cost shifts, of $750 million, not counting proposed MTA cost-shifts.

For each house to prepare its budget proposal, scheduled for passage in mid-March, decisions will need to be completed by the end of the first week in March. With so many tough perennial issues to resolve for the budget, it is very possible that resolving major mass transit issues will be delayed until after the budget, with congestion pricing an open question.

State Comptroller Tom DiNapoli reported last fall the MTA was likely to face another $15 billion shortfall for the 2020-24 capital plan, and possibly much more because phase two of the MTA Subway Action Plan indicated a need for another $8 billion for New York City Transit. But right now the Governor, Chair Lhota, and legislators aren’t articulating this problem.

It is always important to note that it is an election year. If congestion pricing fails there will be a shortfall for the MTA of at least the sum of money congestion pricing would raise. If that was the case, there would be no place to go except another tax increase (and/or several large fare hikes) to fund the mass transit system. The City of New York can only raise the property tax. Only the state government can raise the payroll tax, the personal income tax, the corporate income tax, the sales tax, real estate transaction taxes, etc., or approve the City of New York raising any of its own taxes beyond the property tax.

Chair Lhota claimed the City is responsible for the capital needs of New York City Transit ($16-17 billion in the current 5-year plan) on the grounds that a 1953 law said so. That law, Section 1203 of the Public Authorities Law, did in fact say that but added that the City was responsible for $5 million a year, with anything more than that requiring mayoral approval.

That $5 million cap has not been changed since 1953; the law is an anachronism. When the MTA was created in 1968 the Legislature allowed the City to draw on bridge and toll surpluses for the mass transit system, and in 1981 began passing new state taxes within the MTA region, to dedicate to the MTA, for the obvious reason that the City can only raise the property tax. It is my considered opinion that the Legislature will not raise taxes (and the MTA will not do a fare hike) in an election year, so it’s congestion pricing or bust this year as far as mass transit is concerned.

Jim Brennan was a member of the New York State Assembly for 32 years, where he chaired four committees. On Twitter @JimBrennanNY.

Have an op-ed idea or submission for Gotham Gazette? Email

Congestion Pricing Train Already Running Late in Albany Thu, 08 Feb 2018 05:00:00 +0000
With MTA Facing Massive Shortfall, A Lot Riding on New Congestion Pricing Push Cuomo MTA subway escalator

Gov. Cuomo in the subway (photo: The Governor's Office)

Governor Cuomo’s “Fix NYC” commission produced a framework for a congestion pricing plan, released just after the governor’s Executive Budget for the 2018-19 Fiscal Year, which begins April 1. The congestion pricing framework outlines a three-year phase-in that would provide revenue of $1 billion to $1.5 billion a year starting in 2020, most of which would be intended for the MTA Capital Plan.

That is also the year the MTA must begin its next five-year capital plan for continued investment in the upgrade and preservation of the subway, bus, and commuter rail systems. The current $30 billion plan, the 2015-19 plan, faced a shortfall of $15 billion when initially proposed in 2014, and it was not until 2016 that the governor and the Legislature finally adopted a framework for that plan. The 2020-2024 plan likely faces a similar funding shortfall of $15 billion, so money flowing from a congestion pricing program for the MTA in 2020 would arrive just in time to fill much of that shortfall, although the Fix NYC framework did not outline a specific disposition of the money from a congestion pricing set-up.

A November 2017 report by State Comptroller Tom DiNapoli, “ Financial Outlook for the MTA,“ stressed that the MTA’s capital funding shortfalls could be even larger than $15 billion because more than $7 billion in the 2015-19 plan that the state government committed to providing the MTA still does not have an identified funding source.

Beyond that, MTA Chair Joseph Lhota’s Subway Action Plan Phase Two indicated a need to add $8 billion in capital funding for the subway system. The MTA is not under an obligation to offer the details of its 2020-2024 Capital Plan until the fall of 2019 so it is not clear how all these unmet needs and proposals might fit together. But a shortfall of more than $20 billion is likely.

The comptroller’s office suggested the MTA accelerate the release of the details of its 2020-24 plan to enable greater public engagement in the process of coming to terms with these important decisions. The MTA should do this -- the governor, the Legislature, and the public need to get a handle on what the MTA thinks is needed sooner rather than later. (The comptroller’s report confirmed the concerns raised in my September column: “The MTA’s Long-Term Financial Problem is Severe and May Soon be Worse.”)

If the Legislature does not enact a formidable congestion pricing plan, worth $1 to $1.5 billion a year, enough revenue to support $10 billion or more in bonded funds for the mass transit system, or find some other alternative, it will be catastrophic for the subway, bus, and commuter rail systems, the fundamental infrastructure that allows for the wealth of the New York City metropolitan area. In fact, even if the proposed congestion pricing plan is adopted, the MTA’s greater than $20 billion shortfall would only drop by half and there would still be $10 billion to find unless the federal government were to step in to provide much larger amounts of money than at present.

Mayor de Blasio’s proposal to tax millionaires was envisioned to raise $750 million a year, with $500 million to fund $8 billion worth of bonds for the MTA, and $250 million to subsidize low-income New Yorkers’ subway and bus rides with half-fare MetroCards. Together the congestion pricing plan and the millionaires tax might raise nearly $20 billion for the MTA, coming close to closing the gaps in meeting mass transit capital needs.

Both proposals face significant opposition in the Legislature, from State Senate Republicans opposed to the millionaires tax, to everyday legislators of both parties who simply don’t wish to impose new charges or fees on their constituents to drive into Manhattan, either because they feel the charges are unfair or won’t solve the congestion problem.

Governor Cuomo has not yet submitted a bill to the Legislature that provides the details of the congestion pricing plan or how the money would be used. He has said he wants to discuss the issue with the Legislature first, although he has embraced the concept advanced by Move New York that the tolls on the outer borough bridges that don’t feed the Manhattan central business district should be reduced. That means some of the Fix NYC revenue would be diverted to reduce those particular tolls and not available to the MTA for its capital needs.

The governor has also submitted bills in the budget to force New York City government to come up with much more money for the MTA, a move the de Blasio administration is strongly opposing.

One bill would force the City to pay the 50% of Chair Lhota’s Subway Action Plan that the chair had demanded of the City and that Mayor de Blasio had refused to pay. Another bill would give the MTA the power to create special districts in New York City where subway expansions add property value and allow the MTA to obtain portions of city property taxes related to the new value created for the MTA Capital Plan. The concept was used to pay for the 7-train extension by dedicating revenue from property in the Hudson Yards area to cover the costs, although that plan was a creation of the City of New York and the City controlled the dispositions of funds, unlike the governor’s proposal here, where it does not appear the City would have a say in the matter.

Another Cuomo budget bill is perhaps the most dramatic of all -- it says the City of New York must pay the full cost of the New York City Transit Authority capital plan. The City of New York has a seat on the MTA Capital Review Board and a vote on the New York City Transit Authority Capital Plan, so it has the power to veto that part of the plan. This power does not quite fit with the obligation to fund the plan, nor does it square how parts of the New York City Transit Authority Capital Plan might get funded from other sources of revenue and how the City negotiates the package. The MTA’s capital needs are so immense it is reasonable to ask New York City government to increase its contribution, perhaps even in a major way, but the governor’s proposals are orders rather than requests and may simply be opening gambits for negotiation.

Another major issue is the gargantuan expense of the MTA’s construction programs and purchases. A recent New York Times series described the immense waste of funds in the projects. The MTA, the governor, and the Legislature cannot ignore the problem -- the size of the MTA’s needs just costs too much money and the City and State just can’t afford to write checks to cover $20-30 billion shortfalls.

Right now congestion pricing is the main issue on the table. Mayor de Blasio and the Legislature should support it.

Governor Cuomo and Mayor de Blasio should bury the hatchet, at least as far as the mass transit system goes. There needs to be a consensus about addressing the giant shortfalls faced by the capital needs of the system. It’s also worth mentioning that both former Mayor Bloomberg and the newer Move New York plan sought to use congestion pricing funds to improve express bus service in areas of the City poorly served (or not served at all) by the subway system, and that issue, among others, certainly needs to be taken into account.

The MTA needs an astonishing $2 billion a year in new sources of revenue for the cash and debt service on bonds to cover more than $20 billion needed through 2024-25. If congestion pricing fails and there is no meaningful replacement the prosperity and public safety of the metropolitan area will be threatened.

Jim Brennan was a member of the New York State Assembly for 32 years, where he chaired four committees. On Twitter @JimBrennanNY.

Have an op-ed idea or submission for Gotham Gazette? Email

With MTA Facing Massive Shortfall, A Lot Riding on New Congestion Pricing Push Wed, 24 Jan 2018 05:00:00 +0000
Contrary to Cuomo Claim, Upstate Economy Faltered This Century, Not Last Cuomo upstate jobs

Gov. Cuomo upstate (photo: The Governor's Office)

Governor Cuomo described the Upstate New York economy as suffering from a “bad 50 years “ as he tried to explain why it was hard to stimulate rapid growth in the region’s economy, which has grown far more slowly than the rest of the state and nation (see my prior column: Upstate New York is Home to Heavy Voter Turnout, Major State Investment, and Minimal Job Growth).

Cuomo also said that his administration had changed the trajectory upward. Residents of the state should be concerned about how successful these efforts are: Upstate York has more than a third of the state’s residents and is nearly 50 percent of the vote in gubernatorial elections; the state has enacted intensive programming to uplift that region’s economy, and the state must make major decisions about the allocations of its resources and assets every year and set policy directions.

When I wrote the earlier column, I assumed the governor’s description of Upstate’s economic decline was generally true. But in the course of verifying the accuracy of the 50-year decline claim in order to elaborate on the issue, I learned that it was not true.

The Upstate New York economy only slowed to a crawl in the years after 2000, largely due to the two recessions that occurred between 2000 and 2010. This major slowdown did, of course, occur before Andrew Cuomo became governor in January 2011.  But a detailed look at the history of the state’s economy and employment growth shows that Upstate New York’s employment growth actually outpaced the rest of the state in the 1980s, and continued a moderate climb forward in the 1990s, although both regions grew more slowly than the rest of the nation. Employment grew 20% in each of the two decades across the United States.

New York State Labor Department figures show Upstate employment growing at 17% in the ‘80s, versus 12% Downstate (1). Downstate consists of New York City, Nassau, Suffolk, Westchester, Rockland, and Orange counties (2). Upstate is the remainder of the state.





Growth %














Governor Cuomo seemingly was expressing a public perception that manufacturing job loss broke the back of the Upstate economy decades ago. Manufacturing job loss has in fact been relentless, in Upstate New York and Downstate New York, and the nation as a whole. In 1979 the United States reached its peak manufacturing employment with 19.5 million jobs. New York’s manufacturing employment history since then, divided between the regions:

NYS MANUFACTURING EMPLOYMENT, 1979-90(1),1990-2010(1)

(there are two figures for 1990, see footnote (1) below)



















In 1979-80, manufacturing jobs were 29% of Upstate New York employment, and 17% Downstate. Manufacturing job losses were seriously affecting employment in New York, but in the 50-year lookback to the late ‘60s and ‘70s, it was New York City’s economy that was in freefall in the early ‘70s. New York City lost 600,000 jobs, including 300,000 manufacturing jobs, from 1969 to 1976 (according to the Federal Reserve Board of New York, quarterly review, summer 1977). But the city economy recovered in 1977 and beyond.

Two recessions, in 1980 and ‘81-’82, hit the steel and auto industries in Western New York hard. The huge Bethlehem Steel plant in Erie County closed in 1982. Erie and Niagara Counties lost 41,000 manufacturing jobs from 1979-85. IBM and Kodak began their manufacturing job declines in the mid-to-late ‘80s and continued through the ‘90s. Despite these cutbacks, the Upstate economy as a whole still continued to expand once the recessions were over and grew by more than 400,000 jobs in the ‘80s.

In the 1990s, both regions saw their employment grow at a pace of about 5% for the decade, including the severe recession of the early ‘90s. In 1990, manufacturing was still 18% of Upstate employment but had fallen to 9% Downstate, meaning Downstate’s transformation to a service-based economy had effectively been completed. After the recession was over, the Downstate area did grow more rapidly, but Upstate employment growth still gained over 200,000 jobs and had 7.4% growth over a seven-year period.































Foreign immigration, especially into New York City, began to make a major difference in population growth in the two regions in the 1990s. According to New York City Planning reports, the city gained 800,000 foreign immigrants in the ‘90s .This gain in the City, where two-thirds of the Downstate population lives, roughly mirrored the 800,000 person growth in population in that decade for the Downstate region. Between 2000 and 2015 the city gained another 340,000 foreign immigrants and Downstate gained another 425,000 persons. Between 1990 and 2016 Downstate gained more than 1.6 million people and more than 14% increase in population. Upstate New York gained only 2% in population. With population growth comes new demand for goods and services and employment gains.

pop growth

By 2000 manufacturing employment was 14% of employment in Upstate New York and only 6% Downstate. The United States entered another recession in 2001 and employment actually declined for two years, including a loss of 2 million manufacturing jobs. The terrorist attack that destroyed the Twin Towers and killed thousands also had significant effects on employment in New York beyond the impact of the recession.

After the recession ended employment in the Downstate region grew rapidly until 2008. But the growth rates of the two regions differed sharply, with Upstate growing only 1.7% in the five years versus 6.1% in the Downstate region, when the Great Recession hit New York and the nation. New York City’s economy took off after the Recession, but Upstate New York had lost another 145,000 manufacturing jobs in the decade, more than a third of its remaining factory jobs from 2000. By 2010, Upstate New York had fewer jobs than it did in 2000.

The Upstate economy had a very bad ten years, from 2000 to 2010, and the manufacturing and other job losses during this period truly shook the base of the Upstate economy.







Growth 2003-2008

Growth 2000-2010




























The past column reported that Upstate private sector economic growth from 2010 to 2016 was 5.8%, with slightly faster growth in the bigger metro areas like Albany, Buffalo, and Rochester, but weak-to-no growth in other areas. How and where the state government is allocating its resources and assets will be the subject of the next column, along with a continued look at its economic development policies and overall strategic efforts to leverage meaningful improvement in the Upstate economy.

[Read: Upstate is Home to Heavy Voter Turnout, Major State Investment and Minimal Job Growth]

(1) Older historical employment data contained different employment classification systems, that mixed proprietors and payroll together, among other differences, so the series used for 1980-1990, and for manufacturing from 1979 to 1990, is not comparable to a later 1990 base that uses only payroll employment coming forward from that time.

(2) The New York State Labor Department metro area employment data places Orange County in a Westchester-Rockland-Orange region, so Orange County is counted in Downstate employment.

Jim Brennan was a member of the New York State Assembly for 32 years, where he chaired four committees. On Twitter @JimBrennanNY.

Have an op-ed idea or submission for Gotham Gazette? Email

Contrary to Cuomo Claim, Upstate Economy Faltered This Century, Not Last Tue, 02 Jan 2018 05:00:00 +0000
New York Becomes 17th State to Call for Constitutional Overturn of Citizens United squadron et al demand democracy

Sen. Squadron and "Demand Democracy" ralliers (photo: @DanielSquadron)

Amid increasing calls for New York to pass bold government ethics reform and minimize the role of money in elections, a bipartisan majority of state lawmakers has taken a symbolic but somewhat significant step in calling for an amendment to the U.S. Constitution overturning the Supreme Court’s 2010 decision in the Citizens United case.

In Citizens United v. Federal Election Commission, the Supreme Court ruled that corporations and unions can be considered individuals as far as their political contributions are concerned and that restricting their ability to donate to candidates amounted to a violation of their First Amendment right of free speech. That decision opened the floodgates to unlimited amounts of money in elections, including through outside groups supportive of candidates that must not coordinate with official campaigns but can raise and spend unlimited sums. Nearly 80 percent of Americans agree that the decision needs to be overturned. As of Wednesday, so do 76 New York State Assembly members (of 150 seats) and 32 State Senators (of 63 seats), a bare majority in each house.

Lawmakers and advocates announced at a news conference at the Capitol Building in Albany on Wednesday that a majority of members had signed letters to Congress calling for an amendment. The declaration came barely a week after Governor Andrew Cuomo proposed legislation to blunt the effects of Citizens United. In his announcement, the governor called the decision of the Supreme Court’s worst and said, “This decision ignited the equivalent of a campaign nuclear arms race and created a shadow industry in New York — maligning the integrity of the electoral process and drowning out the voice of the people. Citizens United must be reversed.” This week, he said one of his six priorities for the remaining legislative session is moving forward with his legislation to combat Citizens United that further restricts coordination between candidates and supportive “independent” committees, known as Super PACs.

New York is the first state with a Republican-controlled chamber to call for an amendment, though only two Republicans supported it. (The last vote that gave the Senate effort a majority came from Democratic Sen. Todd Kaminsky, who was recently elected to the chamber, replacing Republican Dean Skelos, who was removed from office upon a felony corruption conviction.) New York now joins the ranks of 16 other states which have done so through resolutions and ballot initiatives. More than 700 municipalities across the country have also passed resolutions, including 21 in New York.

On Wednesday, Assemblymember James Brennan, who led the effort in his chamber, said in a statement, “When we think about the intent behind campaign finance laws, they are supposed to protect our democracy from corruption while preserving the integrity of our elections. Citizens United has done the opposite. By allowing corporations the same rights as individuals, campaigns across the country are being fueled by obscene amounts of money. This has to stop. I call on Congress to do the right thing and pass a constitutional amendment to right this wrong.”

In the Senate, there were four letters with largely the same language. Twenty-four Democrats signed one letter. The five-member Independent Democratic Conference signed the same letter, albeit separately. Democratic Conference Leader Andrea Stewart-Cousins signed one independently. The Republicans, Sen. Phil Boyle and Sen. Kemp Hannon, signed their own version with slightly different language.

“There is motion now in Republican-controlled legislatures to support an amendment,” said Jonah Minkoff-Zern, co-director of the Democracy Is For People campaign at Public Citizen, a nonprofit group that led a coalition of advocates calling on state lawmakers to support an amendment. “The state legislature also needs to follow through and pass state reform,” he added.

Lawmakers more than agree. “It’s great news that a bipartisan majority of State Senators and Assemblymembers support closing the corporate contribution floodgate Citizens United opened,” said Senator Daniel Squadron, in an emailed statement. Squadron led his colleagues in the Democrats’ letter. “It's critical that legislation also move forward to show New York’s strong support for the voice of everyday Americans in the political process.”

Squadron has been one of the leading proponents for closing New York’s infamous “LLC loophole,” which ostensibly allows wealthy individuals and corporations to give unlimited funds to political candidate campaigns through a variety of limited liability companies. Cuomo, a Democrat, has called for closing the loophole and Assembly Democrats have passed such a measure - but the Republican-controlled Senate has balked, defeating the efforts of Squadron and his allies. Good government groups have been calling for closure of the LLC loophole for years, along with a slew of other government ethics and campaign finance reforms in New York, most of which have gone nowhere.

Sen. Boyle, a Long Island Republican, echoed the call for reform in the final legislative package of the year, insisting that his Republican colleagues were equally concerned about the influence of big money on elections both at the state and national level. He said it was important that the same restrictions on campaign contributions apply to corporations, unions, and individuals, hitting one of the key sticking points for Republicans: that unions are treated similarly to corporations. Boyle recognizes that signing a letter to Congress is a symbolic move, but one that can have a strong impact. “I think it’s going to energize the debate and hopefully draw the attentions of our federal legislators,” he said in a phone interview. “As much pressure on Washington D.C. as we can exert, the better.”

Sen. Stewart-Cousins was also encouraged by two Republicans signing on to the petition and called for additional action on legislative reform. “Addressing the negative impact that the Citizens United decision has had on our democracy is important,” Stewart-Cousins said in a statement to Gotham Gazette, “but also we must take action to fix our own glaring campaign finance and ethics issues in New York State such as closing the LLC Loophole which also allows special interests to contribute endless amounts of money. The people of New York deserve an electoral system and government that they can trust.”

by Samar Khurshid, City government reporter, Gotham Gazette

Read more by this writer.

New York Becomes 17th State to Call for Constitutional Overturn of Citizens United Thu, 16 Jun 2016 04:00:00 +0000