Gotham Gazette https://www.gothamgazette.com/component/tags/tag/35 Fri, 20 Sep 2019 08:09:17 +0000 Joomla! - Open Source Content Management en-gb webmaster@gothamgazette.com (Webmaster) The MTA Needs a Real Capital Plan, Not Unrealistic Promises https://www.gothamgazette.com/130-opinion/8799-the-mta-needs-a-real-capital-plan-not-unrealistic-promises https://www.gothamgazette.com/130-opinion/8799-the-mta-needs-a-real-capital-plan-not-unrealistic-promises gov mta transit

(photo: Don Pollard/Governor's Office)


On Monday, the Metropolitan Transportation Authority (MTA) released an 11-page slideshow “overview” partially summarizing the details of its nearly $55 billion 2020-2024 capital plan. The unveiling seemed like Christmas morning - according to MTA CEO/Chair Pat Foye, the plan will sell itself. Everyone will get the pony that they asked for. NYCT President Andy Byford was “ecstatically happy” and elected officials and advocates were told they’d get their top priorities, ranging from costly expansion projects to new subway and commuter rail cars, buses, signals, and elevators. 

Who wouldn’t want a huge infusion of funds into a century old, workworn transit system? We too want to believe! Unfortunately, the numbers just do not add up.

We question both the availability of the funding coming in and the ability of the MTA to spend this massive outlay. Historically, transit advocacy has centered on finding funds, but last year we started looking at actual expenses -- not “commitments” or authorizations to spend, as the MTA does. We found that the real constraint on MTA capital plans has become the ability to spend, not finding funding. (A related problem is keeping costs down so that what can be spent is done so efficiently.)

This plan is really Governor Cuomo’s. He controls the MTA, as described in great detail in our OpenMTA report. There are a few reasons we think his $55 billion “five-year” plan is not tethered to reality. While the Governor’s plan shows that he wants the MTA to spend  70% more on its 2020-2024, the MTA’s capacity to spend that much will not grow nearly as quickly.

In 2018, the MTA spent a record $6.6 billion on capital projects. However, only $4 billion of that was for current projects -- the other $2.6 billion was to complete projects from previous plans.

For about two decades the MTA has gotten further and further behind spending its capital funding. As a result, there is a growing hangover of past-year projects that must be completed every year. We estimate there will be at least $20 billion worth of 2015-2019 projects for the MTA to finish during the 2020-2024 plan.

Let’s assume the MTA can keep capital spending at the record pace of $6.6 billion a year. If it finishes the 2015-2019 plan in five more years, spending an average of $4 billion of the $20 billion per year, it leaves only $2.6 billion a year for 2020-2024 projects. And wait, the MTA still hasn’t finished the 2005-2009 or 2010-2014 plans. Clearly, something is off here. 

We believe that projects that will not be built for at least a decade are more aspirational than real. By promising everything to everyone, the Governor is actually making it impossible to know which projects are real and which are not.

Given what was released this week is still technically a draft (and we’ve still only seen an outline, not a full plan) that must be approved by the MTA Board and Capital Program Review Board (CPRB), there is still time for the MTA to release a real implementation plan showing how it intends to finish this new plan along with all its current projects.

How Much Can the MTA Really Spend On a Five-Year Plan During the Plan?
Bluntly, we think it will be difficult for the MTA to spend even half of the $55 billion proposed for the 2020-2024 plan during that five-year period. MTA capital plans often taking more than 10 years to be completed. While this is not a new challenge, a capital program of nearly $55 billion is unprecedented and presents a good opportunity to figure out how to fix this ongoing structural MTA problem.

The MTA’s ability to spend capital dollars during plan years has decreased, not increased. In 2018, the MTA spent $6.6 billion on capital projects, but only $4 billion was for 2015-2019 projects. The MTA’s best-ever year for spending on projects from the current capital plan was in 2009, when it spent nearly $4.5 billion (see chart below). 

reinvent albany ex

With the 2015-2019 plan’s late start in 2016, there is a lot of work still left to do on that plan. The 2015-2019 plan has $33 billion worth of projects, but the MTA has only received $12 billion in funds as of June 31 of this year, and as of the end of 2018, only $20 billion worth of projects were committed. (A commitment is not the same as actually spending the money, it is the intent to use employees to complete a project or execution of a contract). 

Can the MTA effectively manage more than $6.6 billion a year total in capital spending?

Given the MTA’s limited spending capacity, questions about the credibility of delivering a nearly $55 billion capital plan are warranted. With the recently-approved MTA reorganization, consolidating capital construction staff to headquarters will mean that the MTA will have to do even more with even less. Whether centralization will indeed lead to meaningful efficiencies will take time to determine.

Even if we give the MTA the benefit of the doubt and it does as well as it has in the past, getting $4.5 billion out the door every year, it will take 12 years to finish the 2020-2024 plan. This is all while it has a lot more to do on the current, 2015-2019 plan.

Given the limited ability to manage projects, what will the MTA prioritize?

The slideshow proposes what would be the largest investment in signals for MTA New York City Transit ever, at $7.1 billion. This comes with other large investments for elevators and subway cars, all while large expansion projects are continuing, such as East Side Access and LIRR Third Track.

With limited spending and staff capacity, the MTA will have to choose which projects come first and which come last. Janno Lieber, the MTA’s head of capital construction, has said that signals will come in the five-year window, but as of now, the MTA has not released an implementation plan or detailed project list with schedules of when it will commit to projects, as it has shown in prior plans.

Revenue Dependent on New Federal, State and City Fundings
The nearly $55 billion plan outline makes a number of big assumptions about funding that has not yet been secured. New funding is supposed to come from the federal government ($10.7 billion), the state government ($3 billion), and city government ($3 billion), totalling nearly $17 billion. These numbers are not real until the cash actually arrives from all parties involved.

Is it realistic to expect $10 billion in federal aid?

Under a Democratic president, the federal government contributed $7 billion to the last capital plan. This plan assumes even more federal dollars will come in, including a large contribution for Second Avenue Subway Phase 2: $2.9 billion alone. The feds provided $1.3 billion for Phase 1, so this would double that contribution to this project. While the President indicated support for the project via Twitter, a tweet is not a funding commitment of $2.9 billion.

Is it realistic to expect the state to provide $3 billion in direct aid?

While Governor Cuomo has said the state will provide $3 billion to the new plan, this is subject to legislative approval. The proposal of the Mayor’s match of $3 billion is also under review. Meanwhile, the state still owes $7.3 billion to the MTA for the 2015-2019 plan: it had pledged $8.3 billion in 2016 and only $1 billion has come in so far. 

State Comptroller  Tom DiNapoli, in his recent report on the MTA’s finances, noted that the remaining $7.3 billion will not start to come in until next fiscal year (beginning April 2020). The state also may not provide this as direct aid. It could authorize the MTA to issue its own bonds based on existing or new revenue, meaning that the impact on the MTA and taxpayers is still unknown.

Debt Service and the Operating Budget Crisis
Beyond the MTA’s huge capital needs, it already doesn’t have enough money to pay for the costs of running the system everyday. This is due in large part to debt service payments on previous capital plans. Debt service payments eat up 17% of the MTA’s operating budget now, and the MTA faces even larger out-year deficits. 

Even without new borrowing, the MTA forecasts that its debt will increase 31% by 2023 and will cost more than $3.5 billion a year. A hiring freeze and cuts to staff such as subway car cleaners have meant that MTA workforce morale is low, while customers are increasingly unhappy with the quality of service. And “service guideline” cuts are on the horizon for this fall. 

Will riders endure even more cuts as a result of this plan?

The operating deficit is already significant, and the MTA’s 2020-2024 capital plan outline assumes the MTA will pay for part of the plan with $10 billion in new debt. How much this debt will increase the MTA’s debt service payments, and therefore its operating deficit has not yet been explained to the public. This information is needed to understand exactly what impact the capital plan will have on the MTA’s ability to actually deliver service for its riders, its primary objective.

Real Transparency is Honesty
Reinvent Albany and our colleagues last week announced the Build Trust campaign, asking the MTA to release an implementation plan to show exactly how it will deliver on its promises, and provided a blueprint for better transparency and cost control.  To us, transparency is not merely about putting more data online, but presenting real, honest information to the public.

To comply with state law, the MTA will have to hold a vote on the complete draft capital plan at its September 25 board meeting. As soon as the MTA Board receives the actual capital plan, it is required to be put it online where the public can see it. Yet with less than a week remaining before a Board vote on the $55 billion spending plan, the MTA has not released two important things: (1) the “20 Years Needs Assessment” with a detailed analysis of how much money is needed to repair the system and (2) the full, detailed list of capital projects in the proposed capital plan, with a detailed implementation plan.  

When will the MTA release its 20-year needs assessment and federal TAM plan?

In theory, the MTA is supposed to follow a logical process to determine how much it needs to spend restoring the transit system.

First, the MTA is supposed to compile an inventory of its equipment and infrastructure, including the condition of its assets, and then it is supposed to compile its needs assessment of how much it will cost to repair the system so it can provide good service.

The inventory of its equipment is part of a new federal requirement called the Transit Asset Management or “TAM” plan. The needs assessment has taken the form of a 20-year needs assessment, last released in October 2013 for the last plan. Neither of these documents is publicly available for the next plan.

Without a 20-year needs assessment, or the underlying data about its assets, the public cannot know how much the MTA should be spending to replace very old, but crucial, subway and rail components, like decades old mechanical switches, electrical systems, pumps and fans. (See Reinvent Albany’s report on the MTA capital plan process.)

Decisions on capital spending don’t have to be political - they should be based on real data that takes the subjectivity out of the process. 

When will the MTA release its full capital plan, with an implementation plan?

The MTA’s 11-page slideshow does not differentiate between “core” repairs versus expansion projects, lumps together costs over multiple plans, omits large capital projects, and provides no implementation schedules. This is troublesome and again raises questions about the MTA’s commitment to public transparency. 

Project lists from prior capital plans have tallied more than 60 pages, itemized and coded by type of project. This allows the public to see exactly how the plan breaks out, such as how many fixes to broken equipment there are versus spending that may be more cosmetic, like the last plan’s Enhanced Station Initiative.

Expansion projects are usually expensive, representing an opportunity cost for fixes that don’t involve ribbon cuttings but are crucial like new power stations needed to run additional trains.

These lists have also included project commitment schedules, showing when the MTA intends to commit to projects (again, not spend) during the five-year window. This is the basis for developing a real implementation plan, and should be expanded upon by the MTA as recommended by the Build Trust campaign.

Before the new MTA capital plan is final, the public and stakeholders like the State Legislature -- which should hold hearings this fall before the plan is approved by the CPRB -- need a lot more detail than 11 pages to fully buy in. It is the public’s money after all, and members of the public deserve to be treated like investors who have been given a real, honest plan before staking their own money on the MTA’s future.

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Rachael Fauss and John Kaehny are, respectively, senior research analyst and executive director of Reinvent Albany. On Twitter @ReinventAlbany.

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The MTA Needs a Real Capital Plan, Not Unrealistic Promises Wed, 18 Sep 2019 04:00:00 +0000
The State’s $7 Billion MTA IOU Comes Due https://www.gothamgazette.com/130-opinion/8766-the-state-s-7-billion-mta-iou-comes-due https://www.gothamgazette.com/130-opinion/8766-the-state-s-7-billion-mta-iou-comes-due govcuomoprogre

(photo: the governor's office)


MTA officials acknowledged at their June 2019 board meetings that the agency is borrowing money to be repaid through a New York State law that promised to have the State of New York provide the MTA $7.3 billion once the authority had exhausted its own funds on spending for the current five-year capital program.

The 2016 state law was merely an “IOU," there had been no specific source of funds identified for how the state would pay the money, nor has there been any plan developed since enactment in the state budget that year.

The state's total commitment was $8.6 billion, including some new capital funds it added as part of the newer Subway Action Plan and other promises, which to date have provided about $1 billion in actual funds. It is the $7.3 billion IOU that is still outstanding. New York City was also required to provide $2.7 billion to the agency as part of a mutual obligation with the state. The city has provided about $800 million to date.

These commitments refer to the current 2015-2019 Capital Construction Program, not the 2020-2024 Program to be released in a few weeks by the MTA. That new program, not yet adopted, will have its main funding coming from the congestion pricing system passed earlier this year, with revenue from the tolls scheduled to begin in 2021.

The elements of the 2015-2019 MTA Capital Program were patched together in the 2016-2017 state budget (a year late), my final year in the State Assembly while I was still chair of the Assembly Committee on Corporations, Authorities, and Commissions. The full 2016 package that became the Capital Program was about $30 billion; some $3 billion has been added since I retired. The MTA Capital Program Review Board adopted the plan in 2016 shortly after the budget was enacted.

The question of the state’s outstanding commitment to the MTA capital program, written into the law as the last dollars to be spent in the overall plan, has been the source of limited scrutiny, but is now in the spotlight as the IOU comes due and the next capital program is designed.

At the June 26 public meeting of the MTA Board Finance Committee, finance chair Larry Schwartz and board member Veronica Vanterpool expressed concerns about an agenda item authorizing the MTA to borrow an extra $2 billion to fund the capital program.

Per the minutes of that MTA Finance Committee meeting (page 12):

"Ms. Vanterpool voiced her reservations about increasing the amount, noting that there is that $7.3 billion commitment from the State that has not been received, as well as the commitment from the City. Mr. Foran [the MTA's Chief Financial Officer]... noted that the commitment from the State is predicated on MTA to spend MTA dollars first and that MTA is already beginning to commit against the State's portion (about $2 billion commitment, with some expenditures already incurred) and the State has agreed to that.”

The discussion continued (page 13), "Mr. McCoy [MTA Finance Director] commented that regarding the State funding, the $1.2 billion in BANs [bond anticipation notes] were issued in two components; $1 billion for MTA funded projects, and $200 million is designated for the projects under the State Commitment. Mr. McCoy stated that it was clearly communicated with the State that, when the notes are due, the State will need to provide the funding."

The MTA Board proceeded to add the $2 billion in new borrowing at its main June 26 board meeting two days after this finance committee discussion. State Comptroller Thomas DiNapoli, in an August 7 report on New York City's financial condition, stated (on page 34), "According to the MTA, it has committed all of its capital resources and has begun to commit up to $3 billion against the State's obligation. Consequently, the MTA will require funding from the State beginning next State fiscal year (2020-21) to cover the cash cost of these capital commitments"

Where Will The Money Come From?
The question now is: How will the state meet this new commitment in the coming budget?

The state has the option of itself providing the MTA the money directly, or creating a stream of funding for the MTA to enable the agency to secure the borrowing of the funds, or some combination thereof. But there are serious challenges, the first of which is that 2020 is an election year for the state Legislature.

To enable the MTA to borrow $7.3 billion, a revenue source, i.e. another tax, would need to provide the authority about another $400 million a year. Does the Legislature want to do another tax increase in an election year? Maybe 2021, not 2020. Seven of the eight new Democratic State Senators that won the Democratic party the majority come from the New York City suburbs. Four of these seven suburban races were super-close, with the Democrats winning by just 2-3 percentage points, or even less.

Several other races were won by less than ten points. Many of these newly-minted legislators could be uncomfortable voting for another tax increase for the unpopular MTA, after voting this year for congestion pricing, a real estate transfer tax surcharge, and internet sales taxes. They are already likely to face Republican attacks in the election for these votes.

The state's ability to borrow the funds directly (the MTA does not need all $7.3 billion next year, but over several years) is also severely constrained by limits on the state government established by the Debt Reform Act of 2000. This law limits state-supported debt to 4% of the state's total personal income from the preceding calendar year. The following chart from a July 2 state comptroller report on the 2019-2020 budget shows how the state's capacity to borrow is dwindling.

divisionbudget chart

Next year the state's ability to borrow funds in support of the entire state budget and the entire capital program will be limited to about $1.36 billion and by 2023-24 will be nonexistent. Borrowing for the MTA would be competing with roads and bridges, water and sewer, the state and city public university systems, mental hygiene, and the environment. Little could be anticipated from this source given the constraints.

Another possibility would be for the state to provide the MTA money from the financial industry settlement windfall. Some $2.6 billion is available in 2020-21 from this source, but, once again, the MTA would be competing with upstate economic development commitments, Javits Center and transportation commitments, and general budget relief. But Governor Cuomo and the Legislature could make several hundred million dollars available from this source -- once again, very limited, given the competition for other funds.

Of course, the Legislature could do a tax/fee hike in 2021, even something as simple as extending the for-hire vehicle surcharge on Uber and Lyft to trips with outer borough destinations or adding to the Manhattan business district price. But it is a tax increase of sorts.

Late in the 2015 legislative session, as we struggled to deal with funding the 2015-2019 MTA Capital Program, I worked with MTA senior officials to introduce legislation to provide the MTA a new source of money without a tax increase. The bill provided for a staggered diversion of existing personal income tax revenue from the MTA region over a four-year period to enable the MTA to borrow what was viewed then as $6-7 billion, providing about $400 million a year in revenue to which the agency would be entitled at the end of four years.

Growth in the state's personal income tax revenue would now bring in about $500 million a year under the formula in the bill (A. 8227-a from the 2015-2016 session), so the percentage amount in the old bill could be shaved.

The critical concept of the bill was that it statutorily entitled the MTA to the revenue, enabling it to borrow the money itself and not be a debt of the state subject to the Debt Reform Act and the limits on the state’s capacity to borrow. As written, it would start in the first year with a small three-tenths of one-percent diversion of PIT revenue in the region to the MTA , reaching 1.2% in the fourth year. Each year's revenue piece was separated in a schedule pursuant to law, so if a recession hit, the state could suspend the following year's diversion and preserve revenue in the general fund.

The governor and the Legislature should continue to examine this concept, which was believed to be workable by MTA officials at the time, though viewed by senior Assembly Ways and Means staff as just not needed. But the $7 billion IOU has come due.

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

 

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The State’s $7 Billion MTA IOU Comes Due Thu, 29 Aug 2019 04:00:00 +0000
State Campaign Financing Commission Holds First Public Meeting https://www.gothamgazette.com/state/8752-state-campaign-financing-commission-holds-first-public-hearing https://www.gothamgazette.com/state/8752-state-campaign-financing-commission-holds-first-public-hearing govcuomo justice

The State Capitol (photo: Mike Groll/Governor's Office)


The New York State Public Campaign Financing Commission, tasked with devising a voluntary system of public funding for state elections, held its first meeting Wednesday at the CUNY Graduate Center in Manhattan. The commission has inspired a measure of optimism among government reformers that it will limit the influence of money in state elections and reduce pay-to-play politics that have long defined state government.

The commission, which was named in July, was created in this year’s state budget as a compromise between legislative leaders and Governor Andrew Cuomo when they could not come to an agreement on the specifics of a public campaign finance system for state elections. Seven of the commission’s nine members were appointed by Cuomo, Senate Majority Leader Andrea Stewart-Cousins and Assembly Speaker Carl Heastie, all Democrats, with each selecting two commissioners and jointly appointing another. Republican minority leaders, Senator John Flanagan and Assembly Member Brian Kolb, each had one appointment.

The goal of the commission is to reduce the sway of large-dollar political donors in elections by incentivizing candidates to seek smaller contributions that can be matched with public funds. It would be modelled after the program administered in New York City’s municipal elections by the Campaign Finance Board, which matches small dollar contributions at a 6-to-1 or 8-to-1 ratio depending on what restrictions candidates opt to operate under.

The state commission is charged with developing a plan to distribute up to $100 million in public funding annually to candidates running for legislative and statewide office. In order to participate in the program, candidates will have to adhere to spending limits, lower contribution limits, and stricter disclosure requirements.

The commission’s mandate also includes examining the state’s fusion voting system, which allows candidates to run on ballot lines for multiple parties at the same time. The system gives third parties such as the Working Families Party and Conservative Party a measure of influence in state elections as candidates seek their endorsement and ballot line. In order to maintain their place on the ballot for four years, the parties must receive at least 50,000 votes in a gubernatorial election, which would be threatened if the state commission moved to end fusion voting.

“I hope and expect...that they deal with public campaign finance where small dollars will be matched at least 6-to-1...and I’m hoping that they do not try to get rid of fusion voting,” Senator Robert Jackson, a Manhattan Democrat, told Gotham Gazette at the meeting. “The bottom line is if...smaller parties are out, then you’re dealing with two parties -- and that’s not democracy,” he added.

The purpose of Wednesday’s meeting, where many of the commissioners met for the first time, was to establish procedures for the work that lies ahead. “The first thing we have to do...is organize ourselves and lay a framework for what the commission is going to do and how it is going to do it,” said Commissioner Jay Jacobs, a Cuomo appointee and the chair of the state Democratic Party.

The commission will hold five sessions to solicit input from members of the public, with the fifth meeting reserved for testimony from invited experts. Its final report is due December 1 and will become binding if legislators do not return from break to modify it within 20 days.

At the outset of the meeting John Nonna, the Westchester County Attorney appointed to the commission by Stewart-Cousins, asked whether the commission had the authority to lower contribution limits for candidates who opt out of a public matching program, “because there’s a relationship there that needs to be taken into account.”

“That’s one of the issues that we’ll have to discuss and see where we go on that. I think that’s an issue before us,” replied Henry Berger, a well-known election lawyer appointed to the commission jointly by Cuomo, Stewart-Cousins, and Heastie.

Another issue raised by commissioners was whether the final plan had to be approved in a single vote of the commission at the end of it’s roughly three-month timeline. Jacobs, who submitted a resolution that aspects of the ultimate proposal cannot be separated into multiple votes, explained his reasoning: “The idea being that this is a package and we have to all agree on the components of the package and we can’t pick it apart à la carte.”

“We’re going to vote on it as a single piece of legislation, and that piece of legislation will probably include a severability clause, they usually do,” Berger later added.

The two commissioners appointed by Republican leaders -- David Previtte, selected by Senator Flanagan, and Kimberly Galvin, chosen by Assembly Member Kolb -- voted against the resolution, which carried.

“I voted against the resolution because I had never seen the resolution,” Galvin told Gotham Gazette after the meeting. “I think it’s unfortunate that at an organizational meeting, one of the commissioners would pull out a resolution and expect an immediate vote when we hadn’t seen it, reviewed it, discussed it or talked about it.”

With the commission also looking at the issue of fusion voting, third parties say they are being targeted by Cuomo. Both the WFP and the Conservative Party, along with a handful of state legislators, have filed lawsuits challenging the commission’s authority to change or even eliminate fusion voting, saying the appointed commission cannot change statutes that have been upheld by the courts. Advocates saw Jacobs’s resolution to package the final proposal as a way to bind the issue of fusion voting with the prospect of a public campaign finance system.

“It's a transparent effort to tie public financing and ending fusion voting together. This is Cuomo's poison pill to eliminate fusion voting,” said WFP executive director Bill Lipton, in a statement addressing the resolution.

The WFP has a sour history with Cuomo. The party backed actor and education activist Cynthia Nixon in her primary challenge against the governor last year and supported progressive state Senate candidates challenging members of the erstwhile Independent Democratic Conference. The now-defunct IDC was a group of eight breakaway Democratic state senators who shared power with Republicans and whose then-leader Senator Jeff Klein was a Cuomo ally, allowing the governor to hold sway in a divided Albany.

During the budget session, Cuomo, who repeatedly said he supported creating a public matching system, raised what fusion voting proponents called unfounded concerns about how a public financing system could be administered, and the effects of independent expenditures and fusion voting on the proposed system. “Cuomo has put fusion in the cross-hairs to attack us. Fortunately, the State Constitution protects this important right,” Lipton said

At the meeting, the commissioners also touched on the need to consider the administrative costs of implementing a state public matching system and methods for receiving and considering public testimony, including public hearing procedures and electronic submissions. In a closed executive session, which came at the end of the hour-long meeting, Galvin said the commission considered the issue of staffing, or a lack thereof. “[W]e just all talked about it and tried to figure out some way to [staff the commission], and I don’t think that’s been resolved yet,” Galvin told Gotham Gazette.

For years, advocates have sought a state-level public financing program. Fair Elections for New York, a coalition of labor unions, good government organizations, and community groups, which led the push for public campaign financing during the legislative session and budget negotiations, rallied outside the building prior to the meeting to push for what they hope to see the commission accomplish.

“We are...committed to expanding the democratic process in this state to make sure that big money donors, that corporate dollars, that real estate do not suffocate our democracy,” said Jawanza Williams of Vocal-NY, a multi-issue community organizing group and member of the Fair Elections coalition.

The coalition called for the commission to create a 6-to-1 matching program for both primary and general elections. The group says the high matching ratio must be accompanied by lower contribution limits for both participating and nonparticipating candidates in order to incentivize small-dollar fundraising and participation in the program. The group would also like to see the commission set up an independent enforcement unit separate from the State Board of Elections, whose commissioners are selected by party leaders and which has been criticized for lacking independence.

On Tuesday, Reinvent Albany, a good government watchdog and member of Fair Elections, issued a list of 18 recommendations for the commission, which include establishing clear and granular expenditure guidelines, and lower contribution limits for party committees and entities with business interests before the state.

The overriding goal of reformers is to limit opportunities for pay-to-play politics, which has only worsened in the decade since the Citizens United decision, where the U.S. Supreme Court ruled that political contributions are a form of constitutionally protected speech. New York State also had lax campaign finance laws until they were amended earlier this year, and has seen years of unending corruption scandals with lawmakers regularly going to prison.

“We’re here today to let the Commission and the leaders who appointed them know that New Yorkers are paying attention and expect them to craft a model for the nation to lessen the influence of big money and give power back to constituents,” said Laura Friedenbach, deputy campaign manager for the Fair Elections coalition, in a statement.

The Public Campaign Finance Commission will hold four public hearings throughout the state during September and October. The fifth meeting for invited experts has yet to be scheduled.

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by Ethan Geringer-Sameth, reporter, Gotham Gazette      

Read more by this writer.

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State Campaign Financing Commission Holds First Public Meeting Wed, 21 Aug 2019 04:00:00 +0000
'It's What I Was Elected To Do': State and City Leaders Take Different Approaches to Pension Fund Divestment from Fossil Fuel Companies https://www.gothamgazette.com/state/8735-new-york-pension-fund-divestment-fossil-fuel-companies-different-city-state https://www.gothamgazette.com/state/8735-new-york-pension-fund-divestment-fossil-fuel-companies-different-city-state pension divestment stringer de blasio

Mayor de Blasio & Comptroller Stringer (photo: Benjamin Kanter/Mayor's Office)


Amid the larger discussion about addressing climate change before it’s too late, debate is raging in New York over whether government-run and -affiliated pension funds worth hundreds of billions of dollars and responsible for payments that support hundreds of thousands of retirees should divest from fossil fuel company stock.

Advocates, elected officials, and others have been pushing at the city and state levels for full divestment so that the pension funds are not supporting or tied to companies that are leading contributors to greenhouse gas emissions, a warming planet, and the negative consequences of climate change.

But some officials have warned, and practiced, caution, putting forth arguments that the primary priority of pension fund investment must be return for current and future retirees, and that it is important not to overly politicize investment decisions, especially given how uncertain the future is and that some of the leading fossil fuel companies are at the front lines of figuring out the renewable energy future.

There’s also the argument, often made by State Comptroller Thomas DiNapoli, that by remaining invested with fossil fuel (and other) companies, it is possible as activist investors to help shift their behavior. And while New York City Comptroller Scott Stringer often espouses and practices that philosophy, when it comes to fossil fuel company divestment, Stringer has worked with Mayor Bill de Blasio, labor union leaders, and others to move city pension funds toward dropping stake in those companies.

The New York City and State pension fund pictures are significantly different, with responsibility at the state level much more concentrated in DiNapoli’s office than the city’s in Stringer’s. But the different approaches being taken by the two Democratic comptrollers, who are the popularly-elected chief fiscal officers of their respective jurisdictions, show divergent paths in this particularly fraught political, financial, environmental, and existential moment.

While he’s one of a number of key decision-makers, Stringer is pushing full speed ahead toward fossil fuel divestment by the city pension funds. DiNapoli, meanwhile, has cautioned against that approach, even criticizing it as overly political and reactionary, while taking his own steps to diversify investments, experiment with a carbon-free energy stock portfolio, and push fossil fuel companies toward new policies. 

Advocacy groups like Fossil Free New York and New York Communities for Change are pushing for the $210-billion state pension fund, known as the Common Retirement Fund (CRF), to divest from fossil fuel companies completely. The CRF has about $13 billion in fossil fuel-related investments, according to Fossil Free New York.

In April 2018, as the Democratic primary in his bid for a third term was heating up, Governor Andrew Cuomo declared the state’s pension fund should divest from fossil fuels. But in New York the Governor does not control the pension fund; the State Comptroller is the sole fiduciary of the CRF and, as such, has final say over when investments are made and retracted.

Cuomo DiNapoliWhile he took that stance, Cuomo has not made divestment a major focus, applying minimal pressure to DiNapoli to take more aggressive action. His office recently told Gotham Gazette that the governor is working with the DiNapoli on a path toward divestment, in large part through an advisory group they established together.

Advocates did celebrate in March of this year when Cuomo took a significant new step, calling on state agencies and authorities such as the Metropolitan Transportation Authority (MTA) to examine divesting whatever funds they have in fossil fuel companies.

“As part of the Green New Deal, Governor Cuomo directed State authorities, public benefit corporations, and the State Insurance Fund, which collectively hold approximately $40 billion in investments, to study divesting from fossil fuels. They are reviewing and evaluating the feasibility and appropriateness of such a measure,” Jordan Levine, a spokesperson for Cuomo, said in a statement to Gotham Gazette.

The governor’s office was unable to identify at this time how much of that $40 billion is currently invested in fossil fuel companies.

Back in early 2017, DiNapoli and Stringer both argued that engaging with major fossil fuel producers like ExxonMobil as shareholders would yield better results than immediate divestments.

However, in 2017, Stringer and the five municipal pension funds initiated an analysis of their investments’ carbon footprint in 2017. Then, in January 2018, after the study concluded, Stringer changed his stance. He, Mayor de Blasio, and other pension fund board members announced their plan for three of the five pension funds (the police and firefighter pension funds are not currently part of the plan and account for less than a third of total pension assets). The city’s five funds have about $5 billion invested in fossil fuel producers out of almost $211 billion in pension fund investments. 

In a celebratory announcement that month alongside de Blasio and others, Stringer asserted that he and other city pension fund trustees “would be shirking our fiduciary duty if we were not exploring all options to address climate risk.”

An involved divestment process is underway, at least at three of the funds -- the Comptroller and the Mayor have seats on the boards of all five pension funds but cannot make unilateral or even bilateral decisions about their investments.

State Response - DiNapoli and His Critics
Under considerable pressure to divest state pension funds from fossil fuel companies, in April 2018, Governor Cuomo and Comptroller DiNapoli convened the Decarbonization Advisory Panel to study the issue. In April of this year, the panel released its report, which made several recommendations and put forward “examples” of what the comptroller could do to mitigate the fund’s carbon footprint. However, the report was criticized by climate activists like 350.org’s Richard Brooks for not including a timeline or benchmarks to achieve divestment.

But even before the panel was assembled, DiNapoli had been taking steps around the question of divestment, creating a $10 billion portfolio of investments into green companies. “We’ve done a lot already to allocate money to climate solutions,” DiNapoli said during a May interview on The Capitol Pressroom with host Susan Arbetter, “they’d like to see us do even more there.”

But the comptroller’s stance has caught the ire of local climate activists, who are the ones who want him to “do even more,” as the comptroller put it. Pete Sikora, the climate and inequality campaigns director at New York Communities for Change, said the comptroller “continues to finance the climate crisis.”

“Not to be too sarcastic, but if you’re going to finance evil stuff that destroys our future, you'd hope the state would at least make - not lose - money off it,” Sikora said, noting that the energy sector “continues to trend down over a decade...of industry under-performance.”

“It’s simply insane to not divest, and losing money on the proposition makes it even more absurd,” said Sikora.

Despite growing pressure from activists and lawmakers on the issue, DiNapoli has maintained that his more moderate approach is what is in the best interest of the CRF and its members. He believes that implementing standards such as the ones suggested in the panel’s report will naturally lead to fossil fuel investments being phased out over time and would avoid the negative impacts of wholesale divestment.

In a June 2019 interview with WAMC’s Capitol Connection, DiNapoli said “when we make judgements about where to put the pension fund, we put it in the best interests of the state.” He went on to defend his approach in significantly more harsh terms than the mild-mannered and reserved DiNapoli typically uses.

Some state lawmakers disagree with the comptroller’s assessment and want to force the his hand on the issue.

The Fossil Fuel Divestment Act would require the CRF to withdraw all investments in the 200 largest fossil fuel companies. The FFDA sets a five-year deadline for this to happen and would allow the comptroller to stop or reverse divestment if it can be demonstrated that it would significantly hurt the CRF’s value.

Senator Liz Krueger, a Manhattan Democrat and the FFDA’s prime sponsor in the state Senate, said in a statement that while the proposal did not pass during this year’s legislative session, she “continue[s] to have conversations with my colleagues about the importance of” the bill. She also added that she is “working on amending the bill based on testimony we heard, both to make it stronger and to address various concerns that were raised.”

“With all due respect to the Legislature, for the Legislature to start micromanaging the pension fund is a recipe for disaster long-term,” DiNapoli said on WAMC, adding that “it may be climate change today, but what will it be tomorrow?”

DiNapoli has previously divested the pension fund from gun companies following the 2012 Sandy Hook Elementary School shooting and from the private prison industry over concerns about the treatment of immigrants and people of color in 2018. Both are cited by critics who want the comptroller to act more decisively on fossil fuel companies.

Krueger said she “strongly believe[s] that [DiNapoli] is wrong on divestment” when it comes to fossil fuels, while noting that they “have talked about divestment extensively” and the comptroller has “been a long-time champion of the environment and climate action.” Despite their talks, “neither of us have managed to convince the other,” she said.

Krueger criticized DiNapoli’s “strategy of engagement with major fossil fuel producers like ExxonMobil” for not “providing any consequences when they repeatedly brush him off. It’s time for some consequences.”

“New York should begin the process now or our retirees will be left holding the bag,” Krueger concluded.

“Does anybody think if we sell the stock tomorrow that’ll make the air cleaner? No,” DiNapoli said during the WAMC interview.

“Since it's become clear that Comptroller DiNapoli currently lacks the moral and fiduciary courage to stand up to the fossil fuel industry and Wall Street, this legislation is necessary,” said Sikora, referring to the Fossil Fuel Divestment Act, in an interview with Gotham Gazette.

“It’s clear we have our work cut out for ourselves in both houses,” said Sikora, assessing the bill’s likelihood of passage next session, which begins in January. During the last session, the FFDA had 28 sponsors in the 63-seat Senate and 37 in the 150-seat Assembly.

DiNapoli plans to follow the advisory panel’s recommendations. According to the DAP’s report called the Climate Action Plan, “rather than making a narrow recommendation to divest from specific stocks, the panel supports the concept of minimum standards to guide the fund in its decisions to sell securities and/or avoid investment managers whose operations and strategies are not sustainable.”

The report argues that divestment from unsustainable companies is “baked in” to this plan of action and that the fund will only invest in sustainable assets by 2030.

The panel’s report says that the CRF should have a minimum standard for where its funds are invested. The panel recommends that the criteria for these minimum standards be set through contracts, but only gave “examples” of what the standards could be, such as requiring “an appropriate corporate governance system for the management of climate-related issues” and “a lobbying policy actively supporting government actions to address climate change.”

The report also suggests examples of actions and timeline that the comptroller’s office could pursue, including “excluding all companies that derive more than 10% of revenue from mining thermal coal or account for more than 1% of global production” by 2020 and “if less than 5% decreased in [greenhouse gas] emissions year on year after” several engagements then “consider a shareholder resolution.”

When DiNapoli released the climate action plan, Fossil Free New York called it “a weak plan at a time when we need bold and transformative action,” and said it is “lip service and incrementalism.” The advocacy group further said “the plan includes no benchmarks, no firm delivery deadlines, no parameters to measure companies’ actions, and doesn’t even commit to divest from thermal coal companies, including ones on the edge of bankruptcy.” FFNY supports the Fossil Fuel Divestment Act.

On WCNY’s The Capitol Pressroom in May, DiNapoli said his opposition to divestment stemmed from his responsibility as fiduciary of the state’s pension fund, saying “this is my job, it’s what I was elected to do.”

He also brought up his 2018 reelection, in which he received more votes than he did in 2014, while Mark Dunlea, the Green Party candidate who campaigned almost exclusively on pension divestment from fossil fuel companies, did worse than the previous Green Party nominee when DiNapoli sought reelection in 2010.

“I actually feel that those in the broader public who’ve looked at this issue are more on our side,” the comptroller said. DiNapli’s Republican opponent in the race, Jonathan Trichter, criticized the comptroller from the right, saying he was playing politics by making the moves he had to explore divestment and create the Sustainable Investment Program, in which $10 billion of pension assets are invested in low-emissions or green companies.

Ceres, a sustainability nonprofit, praises Comptroller DiNapoli as “a global leader in the fight against climate change, addressing material risks and pursuing opportunities for the Fund’s investments.” Ceres supports the “active” investor strategy that DiNapoli has claimed is a better path forward than divestment.

During a debate last fall, Dunlea claimed “if we divested a decade ago, we’d have about $22 billion in the state pension fund,” referring to a 2018 assement from Corporate Knights. A competing unions-funded study said the opposite.

While there are competing studies, Bloomberg News reported recently that some private investment funds are beginning to divest themselves from fossil fuel producers, based solely on the financial risks involved.

DiNapoli regularly notes that while he is the sole fiduciary, he does not make his decisions alone by a long shot, with a chief investment officer, a board of advisors, and others who help determine all aspects of pension fund management. On The Capitol Pressroom, DiNapoli said he was unfairly being singled out by activists and other critics, while also noting that New York City was still in the study phase and that two of the five city pension funds had not agreed to divest.

“So the pressure on me is that we guarantee retirement security for the 1.1 million members of the pension plan, which is a lot of pressure,” DiNapoli said.

New York City Divestment
City Comptroller Scott Stringer has changed course from his previous stance and is now leading an initiative to divest the city’s pension funds from fossil fuel companies, although he is encountering his own challenges in doing so.

“New York City is planting the seed for a clean, green, and thriving economy that can truly support future generations,” Stringer said in a statement to Gotham Gazette. The city has “taken this first-in-the-nation step toward divestment to protect both the retirement security of our city’s workers and the future of our planet,” the comptroller added.

The plan announced by Stringer and Mayor de Blasio in January 2018 set a goal of total divestment within five years. As of July 2019, the city is still in the planning stages, having sent out a request for proposals (RFP) for financial advisors to come up with a divestment strategy last December. The comptroller will select a plan to move forward by December 1 of this yea. But, a key wrinkle in the process is that two of the city’s five municipal pension funds are not on board with divestment as of now.

Unlike the state pension fund, New York City’s public employee pensions are not unified under one system. Instead, there are five separate funds, each with their own boards. In total, the pension funds account for over $195 billion in assets. The largest is the New York City Employees Retirement System (NYCERS), which handles the pensions for most municipal employees.

There were two pension funds for the city’s education-related employees, the Board of Education Retirement System (BERS) covers most non-teacher civil service employees of the city’s school district, while the Teachers’ Retirement System (TRS) is for educators employed by the Department of Education, CUNY, or charter schools in the city. The NYPD and FDNY each have their own pension funds, the Police Pension Fund (PPF) and Fire Department Pension Fund (FDPF), respectively.

Also unlike the state pension fund, each of the five funds has its own board and the city comptroller is not the sole fiduciary of the funds. Each board has its own composition requirements. The Mayor or a mayoral appointee sits on all five boards, as does the city comptroller. The Public Advocate sits on the NYCERS board. Also, relevant city officials sit on some of the boards, such as the Police Commissioner on the PPF board and the schools chancellor on the BERS board.

The NYCERS board includes a mayoral appointee, the comptroller, the Public Advocate, and the five borough presidents, along with representatives from labor unions including AFSCME, the Teamsters, and the Transport Workers Union, which are the three unions with the most members in the fund.

Primarily, pension fund board members are representatives of pension-eligible employees. Eight of the twelve board members for the both the PPF and the FDPF are either union leaders or elected representatives of pension fund members.

In 2017, all five pension funds initiated a study of climate change’s effects on their funds, which was led by the comptroller’s office. However, a year later, the police and firefighter pension funds did not join the other three funds in announcing plans to divest from fossil fuels.

The PPF and FDPF’s bylaws both require a seven-twelfths majority of the board to take action on anything, such as a divestment proposal. The comptroller and mayoral appointees on both boards fall far short of having the votes to divest without buy-in from at least some of the union leaders or employees. 

In a statement, Sikora praised the comptroller, along with Mayor de Blaiso and other trustees, for “taking real action to fight the climate crisis and we look forward to complete divestment.” Sikora also said that New York Communities for Change is “satisfied with the progress to date” of the city’s divestment plan.

The Patrolmen’s Benevolent Association and the Uniformed Firefighters Association did not respond to repeated requests for comment regarding their positions on the city divestment plan.

***
by Andrew Millman, Gotham Gazette
   

Read more by this writer.

Ben Max contributed to this article.

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'It's What I Was Elected To Do': State and City Leaders Take Different Approaches to Pension Fund Divestment from Fossil Fuel Companies Mon, 12 Aug 2019 04:00:00 +0000
As New York’s Ambitious Energy Plan Breaks Offshore Wind Records, Report Identifies Challenges and Opportunities https://www.gothamgazette.com/130-opinion/8722-as-new-york-s-ambitious-energy-plan-breaks-offshore-wind-records-report-identifies-challenges-and-opportunities https://www.gothamgazette.com/130-opinion/8722-as-new-york-s-ambitious-energy-plan-breaks-offshore-wind-records-report-identifies-challenges-and-opportunities energy gov nrel gov 2

(photo: Energy.gov/NREL.gov)


The offshore wind energy revolution has arrived on American shores. In a relatively short period of time, East Coast states are breaking offshore wind records as they compete with each other over wind power. A recent report, though, by the Business Network for Offshore Wind finds that industry challenges will slow growth unless offshore wind states work together to find solutions.

Recently, New York Governor Andrew Cuomo launched the largest offshore wind project in the country. His climate change bill codified 9,000 megawatts of offshore wind power into law, which will produce clean energy for over 3.4 million homes. Similar record-breaking news has been announced in other East Coast states but problems with grid connections, transmission lines, port infrastructure, marine logistics, and employee training can stand in the way of reducing carbon emissions with ocean power quickly and efficiently.   

The speed behind the development of ocean power is one of the most important races the United States must run to strengthen our environment, our economy, and our job growth. Today the U.S. has one offshore wind farm consisting of five turbines, compared to Europe’s 4,543 grid-connected offshore wind turbines across 11 countries. During the next two decades, East Coast states and California will have over two-dozen offshore wind farms under development in various stages. 

Our states have demonstrated they can and will play a critical role in the global renewable energy market, but we have work to do if we wish to ascend to a top leadership position globally. With the help of over 100 offshore wind experts, the Network’s Leadership 100 report focuses on the demands facing the industry with recommendations to meet them.

For example, New York, New Jersey, and Massachusetts are accelerating their goals for a total of almost 16,000 megawatts (MWs) in offshore wind power. But, as of right now, the Northeast grid will be challenged in capacity to produce beyond 4,000 MWs.

The report argues that a project-by-project approach to grid connection is necessary to get the first turbines in the water. However, once the first few projects are constructed and connected to the grid, it will be difficult to reach the goals set forth by states without a coordinated grid approach. This means states need to build and pay for one grid for all states on the East Coast.

Port infrastructure is another obstacle. The report recommends that port infrastructure for offshore wind should be built and its use distributed among states, meaning some states will use port infrastructure in other states to support different parts of a project, and other states may not need to build offshore wind ports at all.

Unique and customized solutions for the U.S. offshore wind industry will give way to yet unknown spin-offs. For example, a bonus industry for the East Coast region is a marine logistics industry. With multiple developers and utilities involved in different states, marine logistics will be critical for coordinating the use of vessels and ports.

Also, as the report explains, bottlenecks will occur, along with setbacks, if the U.S. does not inventory what it can do well and focus on these few things. State competition needs to be resolved and a recognition that not everything can be built in the U.S. is also required.

Overall, there is confusion within the states about the labor, skills, and training needed for offshore wind production. Industry leaders also are confused on where to access training. Our workforce development system is daunting and needs improvements.

The Network’s report includes recommendations for offshore wind states for advancing grid and transmission projects, developing an industry road map and launching a public engagement campaign. The offshore wind supply chain has the potential to reach every state. We all want an American industry operated with American content, intelligence, and know-how. Let the race for ocean power begin but let’s all get on the same team.

***
Liz Burdock is President and CEO of Business Network for Offshore Wind. Jay A. Borkland is Senior Engineering Manager for Lloyd’s Register Boston Office of Renewables. On Twitter @LizBurdock1 of @offshorewindus.

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As New York’s Ambitious Energy Plan Breaks Offshore Wind Records, Report Identifies Challenges and Opportunities Tue, 06 Aug 2019 04:00:00 +0000
As Cuomo and Heastie Trade Comments on Anti-Poverty Efforts, a Closer Look at What They've Done https://www.gothamgazette.com/state/8693-as-cuomo-and-heastie-trade-comments-on-anti-poverty-efforts-a-closer-look-at-what-they-ve-done https://www.gothamgazette.com/state/8693-as-cuomo-and-heastie-trade-comments-on-anti-poverty-efforts-a-closer-look-at-what-they-ve-done albany gov cuomo carl heastie

Speaker Heastie & Governor Cuomo (photo: the governor's office)


Despite previously lauding the 2019 state legislative session as the “most productive session in modern political history,” Governor Andrew Cuomo went on to call the session “not progressive enough,” citing a need “to do more on poverty.”

At his celebratory, mostly upbeat end-of-session press conference on June 21, Cuomo was asked about what did not get done, and cited three issues he said he would work on next year: legalizing adult-use marijuana and paid gestational surrogacy, and expanding prevailing wage requirements on construction projects that receive state incentives. He did not mention poverty.

But just three days later during a radio appearance, Cuomo questioned whether the legislative session was “progresive enough,” and rhetorically asked WAMC’s The Roundtable host Alan Chartock, “what happened, doctor, to discussion of poverty and civil rights and the minority community?”

It was an apparently off-hand comment that seemed to catch many people by surprise, especially Assembly Speaker Carl Heastie, a Democrat whose district is in the Bronx, which is home to some of the highest poverty rates in the country.

While Cuomo has made significant strides with anti-poverty policies in the past, most notably the minimum wage hike he ushered through a split Legislature in 2016, the third-term Democratic governor did not push any landmark anti-poverty legislation or initiatives this session, which featured a long list of other progressive accomplishments with Democrats in control of both legislative houses for the first time in many years.

Soon after Cuomo’s comment about the session lacking a focus on poverty, Heastie was asked about it.

“If we’re talking about things like poverty, that necessitates putting more money in the budget,” Heastie said on June 25, appearing on WCNY’s The Capitol Pressroom with host Susan Arbetter. “If that’s the governor’s sentiment, next year we should see a robust poverty agenda in the executive budget,” he said.

When asked about the Assembly’s anti-poverty efforts, Heastie mentioned boosting community college enrollment and said such schooling can serve as a key stepping stone to the workforce.

“Every place has a different type of industry, and community colleges can put together training linked with local businesses,” Heastie said on Capitol Pressroom.

In New York, 2,908,471 people live in poverty, according to the New York State Community Action Association in its 2019 annual poverty report. That’s about 15% of the state’s 19.8 million residents; a rate just above the U.S. poverty rate of 14.6%. For white New Yorkers, the poverty rate is 11%, while it jumps to 22.5% for black New Yorkers and 24.4% for Hispanic New Yorkers. Of the 1.8 million adult New Yorkers with no high school diploma, 29% live in poverty.

Though they give both Cuomo and Heastie’s Assembly majority credit for significant steps toward fighting poverty in New York, advocates and other experts believe both have indeed been lacking in moving a number of anti-poverty measures.

Several proposed anti-poverty bills have stalled in the Assembly, and those that have passed the Assembly have not been signed into law by Cuomo, in part due to a lack of support by the governor, who was friendly with the Republican Senate majority that ruled the upper legislative chamber for all of the governor’s first two terms.

As Heastie indicated, some see the need for more state spending on anti-poverty measures, which may only be possible through tax increases, which Cuomo generally opposes. Some say a significant roadblock to many anti-poverty programs is the 2 percent cap on annual state spending increases that Cuomo has insisted on, though he has repeatedly broken that pledge. Still, Cuomo has largely kept state agency operational spending flat year over year and is loathe to add new expensive programs to the budget, especially those that don’t fit his carefully crafted agenda.

But while he has not supported key policies that advocates say would help fight poverty in New York, Cuomo has moved several significant anti-poverty measures, from the minimum wage hike to the Empire State Poverty Reduction Initiative (ESPRI), which provides state grants to localities to fund anti-poverty efforts, to the creation of the Child Care Availability Task Force, which is currently studying how to make childcare more affordable in New York.

Heastie said on Capitol Pressroom that the Assembly focuses on high poverty communities and tries to find ways to revitalize them, including through working with Cuomo to add localities to the ESPRI. Most parties point to the state’s high levels of local education funding as evidence of efforts to fight poverty through educational investments, but that focus has been criticized, even by Assembly Democrats, who believe the state owes billions in funding to poor schools, and Cuomo, who recently started saying he wants more state funding to go to poorer schools without corresponding increases to wealthier schools.

During Heastie’s four years as speaker thus far, the Assembly has pushed anti-poverty efforts, including as a key force behind the minimum wage increase and the paid family leave program that also passed the same year. But there are also some question marks.

In January 2016, Heastie announced an “Anti-Poverty Work Group,” with the goal of finding “ways to break the vicious cycle that forces people to focus on getting by and never allows them to focus on getting ahead,” he said in the press release. The work group consisted of 13 Assembly members, and was specifically tasked with coming up with ideas to improve nutrition, literacy, supportive housing, shelters, rental assistance, fair labor practices, and job training, and increase access to quality child care and health care.

However, little came of the work group -- there’s no other record of its existence in Assembly press release archives or on the Assembly website more broadly.

The work group was organized with the goal of breaking “down the silos we deal with in the Assembly,” Queens Assemblymember Andrew Hevesi, who served on the work group and has chaired the chamber’s social services committee, said in an interview with Gotham Gazette.

According to Hevesi, when former Assembly Majority Leader Joe Morelle left the Assembly at the end of 2018, the work group “fell off the top of everybody’s radar.” But even that would have been nearly three years after the group’s creation, and Morelle did not serve as its chair. Hevesi said the group had only a “couple of meetings.”

Anti-Poverty Initiatives Left on the Table
There are a variety of anti-poverty measures that could be considered by the Legislature and Cuomo. For example, a proposed bill aimed at reducing homelessness would have created a homeless housing task force by each social services district in the state to “develop a ten-year homeless housing plan addressing short-term and long-term housing for homeless persons,” according to the bill. The bill has not moved in the Assembly social services committee.

Anti-poverty measures can be bipartisan. Republican Assembly Minority Leader Brian Kolb is the lead sponsor on a bill to raise the state earned income tax credit (EITC) from 30 percent to 45 percent of the federal level. Currently, a family with three or more children can earn a maximum of $8,682 in their EITC, and a filer without children can earn a maximum of $701 in their EITC, including state, city, and federal credits, according to the New York State Department of Taxation and Finance. Another Assembly bill would expand the EITC to include workers who are 18-24 years old, a demographic that is currently not eligible for the EITC. The state EITC was last raised by Republican Governor George Pataki in 2003.

Neither the Assembly nor the Senate took up state EITC expansion this year.

That Assembly Republicans are leading the fight to raise the EITC is “both ironic and shameful,” said Ron Deutsch, executive director of the Fiscal Policy Institute, a think tank, in an interview with Gotham Gazette. “For the Assembly minority to be to the left of the governor on an issue like this really speaks to the fact that the governor is far more fiscally conservative than he paints himself,” he said.

According to data from the Fiscal Policy Institute, 85,345 young adult workers in the state that would be eligible for the childless EITC are currently excluded because they cannot be claimed as a dependent. These workers earn less than $15,270 as single filers or less than $20,900 as married filers.

Another proposed anti-poverty bill, championed by Hevesi, is known as Home Stability Support (HSS) and would increase rent supplements to families at risk of eviction, homelessness, or loss of housing due to domestic violence or hazardous living conditions. While the Assembly has pushed HSS for several years, it has not made it into the state budget, apparently due to Cuomo’s opposition.

HSS is widely seen as a way to prevent homelessness, and has many backers in both city and state government, as well as the advocacy community. According to data from the Assembly Committee on Social Services’ annual report, each year about 250,000 New Yorkers experience homelessness, and three of five homeless New Yorkers are school-aged children. In 2018, 23,000 more people became homeless, the report says. The number of homeless school-aged children has grown by 69% since 2011 (Cuomo’s first year as governor).

According to data from city Comptroller Scott Stringer’s office, over 10 years HSS could reduce the shelter population in New York City by 80 percent among families with children, 60 percent among adult families, and 40 percent among single adults. As Hevesi and others regularly point out, the cost of HSS subsidies are projected to be recouped in savings where governments spend less on shelters and other aspects of the social safety net.

HSS is projected to cost $9,865 per year for an individual in New York City, $7,320 per year for an individual in Westchester County, and $2,784 per year for an individual in Monroe County, according to data from the proposed plan. HSS advocates argue that the legislation would save the state money, as it would keep individuals and families out of shelters, which cost significantly more per individual per year to maintain. Providing an individual with temporary housing, or shelters, costs $25,925 per year in New York City,  $36,000 per year in Westchester County, and $10,950 in Monroe County, according to data from the plan.

The legislation has had support in both houses, but not enough to move it through both and to the governor. Neither majority appeared to make it a priority this year as the Legislature moved a long agenda of progressive bills.

“Home Stability Support will be a lifeline for thousands of New Yorkers to avoid falling into the cycle of homelessness, and it will also save millions of dollars for towns, counties and cities throughout the state,” State Senator Liz Krueger said in a press release supporting HSS.

Hevesi said that the reason the bill has never been passed is that Cuomo is against it. However, Hevesi said he is confident that the bill will get passed eventually, either legislatively or in the budget.

“It was in the Assembly one-house budget, Senate one-house budget, and the governor unilaterally stopped it,” Hevesi told Gotham Gazette.

HSS has been supported by a number of advocacy groups fighting poverty and homelessness in the state. Still, there was no clear, concerted effort by the Assembly and Senate majorities to push HSS over the finish line and into the state budget before it was voted through on April 1.

“Unfortunately over the past several years, in our advocacy to pass HSS, the governor has been one of the primary roadblocks,” said Helen Strom, a benefits unit supervisor at Urban Justice Center (UJC), an advocacy organization and think tank focused on bringing people out of poverty.

Hevesi accused Cuomo of profiting off of homeless shelters via Help USA, a nonprofit providing shelter that Cuomo founded many years ago and is now led by the governor’s sister.

“I don’t think he’s fighting homelessness,” Hevesi said. “I think he’s making money off of homelessness. Every policymaker in the state is for stopping the growth of the crisis except for him,” he said.

Via a spokesperson, Cuomo’s office pushed back against Hevesi’s accusation, calling it an “irresponsible lie” in a statement to Gotham Gazette, and saying the governor makes no money from Help USA.

Another issue some advocates and lawmakers raise around fighting poverty is health care, and while the state has very high rates of health care insurance coverage -- roughly 95% of New Yorkers are enrolled, in part due to robust government programming -- costs are still high for many. The Assembly majority had for several years passed the New York Health Act, which would create a universal, single-payer health care system in New York, but did not push the policy, which is opposed by Cuomo, this year, when it actually had a chance of passage in the newly-Democratic Senate. While most of the senators in the new majority had either co-sponsored the New York Health Act last year or expressed support for it during last year's campaigns, the legislation did not move in either house this year. Cuomo has said he believes single-payer health care is the best goal, but that it should be done nationally, that to do it in New York would be unrealistic given how much it upheaval it would require, including raising taxes on many New Yorkers and roughly doubling the state budget.

While advocacy groups agree in their criticism of Cuomo, “no one,” including Cuomo and the Assembly, has made anti-poverty measures “a real priority,” Deutsch said. “We can’t continue down this path any longer.”

Assembly Accomplishments
According to the Assembly majority, in March 2016, it successfully added municipalities to the governor’s Empire State Poverty Reduction Initiative (ESPRI), though it does not appear this was a direct result of the anti-poverty work group given it had just been assembled and seems to have done little overall.

ESPRI invests money directly into 16 communities with high poverty rates. Among communities introduced by the Assembly to the initiative are Troy, Hempstead, Buffalo, Oneonta, Albany, Rochester, and Broome County. Upon being added, these communities became eligible to receive ESPRI funding, which began with a $25 million investment in 2015 and received $4.5 million in the 2020 budget.

ESPRI funding supports programs including financial literacy, job training, mental health and substance abuse counseling, and more.

While advocacy groups agreed that no substantial, explicit anti-poverty measures passed this legislative session, some programs that did move are likely to help fight poverty.

“Despite the state’s fiscal constraints, the Assembly ensured this year’s state budget invested in services for families struggling with the costs of housing, child care and after-school programs while restoring critical cuts to Medicaid and education,” Speaker Heastie said in a statement to Gotham Gazette. “The Assembly Majority remains focused on advancing our Families First Agenda, which includes identifying ways to lift New Yorkers out of poverty,” he said.

The state approved a program to end cash bail in most instances, allowing most people accused of a non-violent crime to remain out of jail while awaiting a court date. In pushing for major limits on cash bail, one central argument was that the use of it criminalized poverty, essentially making it that poor people who can’t afford a few hundred dollars in bail would sit in jail, and risk losing their jobs and other community ties.

In Schenectady County, those arrested spend an average of 40 days in jail before they are charged, with some let go without being charged at all, according to Citizen Action State Organizing and Training Director Jamaica Miles.

“The people most likely to be sitting in jail are those that cannot afford to pay the bail or bond to get out,” Miles said in an interview with Gotham Gazette. “You’ve made their lives more difficult before convicting them of a crime,” she said, if they are ever convicted at all.

Additionally, the state’s newly approved rent regulations, highly favorable to rent-regulated tenants, are expected to be beneficial to many low-income families.

“The hope is they won’t be evicted as easily as they are being evicted now,” Deutsch said.

Looking ahead, the Assembly will be re-introducing a package of bills that “overhauls” the public assistance system, Hevesi said.

With the current public assistance system, many low-wage workers can earn enough to work themselves out of the benefit and lose their vouchers, but when they lose public assistance they can no longer afford to live where they’re living, Strom said.

To remedy the system, the state can raise the eligibility income levels for public assistance or create a different income level for housing vouchers, so those receiving public assistance can retain their vouchers while they transition to being off of benefits and on an employment income, Strom said.

“As it’s currently structured it’s a trap. Once people are on public assistance they are trapped in perpetuity. We have an opportunity to break that system up and give people the incentives they need to get off public assistance,” Hevesi said.

The Assembly had a hearing on the overhaul set for the end of the previous legislative session, but it didn’t come together in time, Hevesi said. The bills have veto proof support in the Assembly, including backing of Minority Leader Brian Kolb, and are over the 32 vote threshold to have a majority in the Senate, but still do not have the support of the governor, Hevesi said. 

The Assembly also pushed the governor for the creation of 20,000 units of supportive housing for the chronically homeless, Hevesi said.

“After a several-year battle [Cuomo] agreed, but then stalled again when we had to force him two years ago to release $1 billion to get the first 6,000 units,” Hevesi said.

Cuomo’s Efforts
Until his June comments on WAMC radio, just after the end of the budget and legislative session in Albany, Cuomo had said very little directly about poverty in 2019.

He did not explicitly discuss “poverty” in any of his three major speeches (a December “First 100 Days” address, his January 1 inaugural remarks, and his State of the State speech later in January) that set the stage for this year in Albany, the first under full and functional Democratic control of both the governor’s office and Legislature in several decades.

Cuomo did mention several programs, both already passed and on his 2019 agenda, that relate to poverty, though, including the minimum wage hike, which has seen the wage hit $15 per hour in New York City, with other increases around the state.

In his December 2018 speech outlining his agenda for the “first 100 days” of his third term, Cuomo called the lack of affordable housing “a crisis,” and promoted what he says is the state’s largest ever investment in affordable housing, which appears to have meant continuation of an ongoing $20 billion program that requires new budget investments each year.

He also called for renewed rent regulations that would improve certain tenants’ rights, which ultimately passed in the Legislature and were signed by the governor to much acclaim by activists, advocates, and lawmakers.

In his inaugural address, Cuomo again avoided the issue of poverty directly, but touted the state’s accomplishments and agenda related to fighting climate change, ending cash bail, legalizing marijuana (which failed to pass during the legislative session), and investment in affordable housing.

In his State of the State address, Cuomo again did not explicitly discuss poverty, but he put forth budgetary and legislative proposals to alleviate burdens for those in or near poverty. Cuomo’s executive budget plan proposed providing more state aid to poorer schools and school districts, while moving ahead with planned funding for affordable housing and to fight homelessness, among other measures that stand to help people living in or near poverty, like cash bail reform and green economics.

In his State of the State policy book, Cuomo did include a short section on “Combating Poverty,” with two planks: one, further supporting the Empire State Poverty Reduction Initiative (ESPRI) and establishing ESPRI representation on Regional Economic Development Council workforce development committees; and two, “reduce hunger and food insecurity.” Cuomo would “establish a goal to reduce household food insecurity in New York State by 10 percent by 2024,” the policy book reads, and will do so by “directing the following actions: create a food and anti-hunger policy coordinator; simplify access to SNAP for older and disabled adults; enhanced resources and referrals in clinical settings; participate in SNAP online purchasing pilot; and expand food access in Central Brooklyn.”

Asked about the governor’s anti-poverty record in light of his comments and Heastie’s response, the governor’s office highlighted a number of programs.

“New York State is leading the fight against poverty through a holistic approach, including raising the minimum wage to $15 an hour, and a $20 billion plan to combat homelessness and create or preserve more than 100,000 affordable homes and 6,000 providing supportive services,” Cuomo Press Secretary Caitlin Girouard said in a statement to Gotham Gazette.

According to the Governor’s office, Cuomo’s poverty reduction programs include 2013’s anti-hunger task force, 2015’s $25 million ESPRI to address regional pockets of poverty across the state, and the $15 per hour minimum wage program that he ushered through in 2016, which is phased in over several years and sets different wages in different regions of the state.

According to data from the “Unheard Third,” a regular opinion poll of low-income households conducted by the nonprofit Community Service Society, half of low-income hourly workers in New York City say that the recent increases in the state minimum wage is making them better off.

The percentage of New Yorkers in poverty decreased every year from 2013 to 2017, from 16 percent of New Yorkers living below the poverty line in 2013 to 14.1 percent in 2017, according to data from Talk Poverty, an organization that tracks poverty levels in every state. Since the minimum wage has passed, 247,775 fewer New Yorkers are living below the poverty line, according according to data from Talk Poverty. (The aforementioned New York State Community Action Association in its 2019 annual poverty report estimates 15% of New Yorkers living in poverty, using recent Census data from 2013-2017.)

Moving ahead, Cuomo has said he wants to continue to invest in education, but with aid directed disproportionately toward poorer K-12 schools. When the new state budget passed in April, education funding increased to $27.9 billion, with over 70% of the increased funding going to schools in poorer districts, according to the budget.

The state has increased funding for higher education, too, which has a distinct budget of $7.6 billion, by $1.6 billion, or 27 percent, since 2012 (Cuomo took office in 2011), according to data from the Governor’s office. Still, Cuomo has faced criticism related to funding for CUNY and SUNY public higher education institutions, and how his signature Excelsior Scholarship program is working.

In December of last year, Cuomo announced the Child Care Availability Task Force, a group of experts assembled to develop solutions that will improve access to affordable child care. The task force examined “access to affordable child care, the availability of child care for parents with non-traditional work hours, statutory and regulatory changes that could promote or enhance access to child care, business incentives to increase child care access, and the impact on tax credits and deductions relating to child care,” according to a press release announcing its creation.

"We want to ensure that working families are provided with the resources for safe, accessible and affordable child care. By promoting and investing in child care, we know it can improve women's participation in the workforce and narrow the gender wage gap,” said Lieutenant Governor Kathy Hochul, who is a co-chair of the Child Care Availability Task Force, in the press release. Hochul has said she expects its initial recommendations to help inform the Cuomo administration’s 2020 agenda.

***
by Noah Berman, Gotham Gazette

Read more by this writer.

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As Cuomo and Heastie Trade Comments on Anti-Poverty Efforts, a Closer Look at What They've Done Wed, 24 Jul 2019 04:00:00 +0000
Cuomo’s Getting His Belmont Arena, But the Numbers Don’t Add Up https://www.gothamgazette.com/130-opinion/8687-cuomo-s-getting-his-belmont-arena-but-the-numbers-don-t-add-up https://www.gothamgazette.com/130-opinion/8687-cuomo-s-getting-his-belmont-arena-but-the-numbers-don-t-add-up belmont park redev

Belmont arena rendering (rendering: Sterling Project Development)


Delayed appraisal, dubious benefits analysis, interest-free financing complicate rosy outlook

Three lessons from the long battle over Atlantic Yards/Pacific Park and the Barclays Center in Brooklyn are that promises of huge financial benefits deserve skepticism, that independent studies trump promotional ones, and that scenarios should be presented as a range of outcomes, rather than just the best case.

Unfortunately, those lessons have been ignored regarding the new sports-and-entertainment arena complex planned at Belmont Park in western Nassau County, with the New York Islanders as anchor tenant and Gov. Andrew Cuomo, surely anticipating a big ribbon-cutting in 2021, as the chief cheerleader.

The near-final step toward approval of “the transformational $1.26 billion Belmont Park Redevelopment Project” came in a Cuomo press release July 8 announcing that a new Long Island Rail Road station would help serve the project, which also includes a hotel and “luxury outlet stores.” (That retail, as I explain below, might be the priority for the Islanders’ owners.)

The press release came with a chorus of praise—the new station might lessen the likelihood of arena-related traffic chaos—but left seeds for doubt.

Unfortunately, as the project comment period ends August 1 and approval votes loom soon after, the Cuomo administration has obfuscated public assistance for the station and an overall deal that gives the developers the project land essentially rent-free, while presenting an economic benefits analysis with glaring gaps, and delaying the delivery of promised data.

Who’s paying for the station?
The estimated cost of the station is $105 million. According to the press release, “The arena developer will cover $97 million— 92 percent of the total cost — and the State will invest $8 million.” The developer is New York Arena Partners, or NYAP, involving Sterling Equities, the Scott Malkin Group (Islanders’ owners), Madison Square Garden, and the Oak View Group.

That scenario was belied by a “Fiscal and Economic Benefits” report attached to the Final Environmental Impact Statement (or Final EIS), which said NYAP would initially contribute $30 million for that new station, then pay $67 million over the course of 30 years.

That sounds like the equivalent of interest-free financing, a huge bonus for the developer. Unfortunately for the public, Newsday, Long Island’s dominant newspaper, initially accepted Cuomo’s framing, while an editorial columnist echoed Cuomo’s take, gaining an enthusiastic tweet from a spokesperson for Empire State Development (ESD), Cuomo’s economic development authority, who essentially called alternative explanations fake news.

By contrast, Neil deMause, writing in Gothamist, estimated that the financing offered a $33 million public bonus to the developers.

To me, it recalled the 2009 deal in which Forest City Ratner, which had bid $100 million for the right to build over the Metropolitan Transportation Authority’s Vanderbilt Yard in Brooklyn, negotiated relaxed terms: permission to put $20 million down (for the parcel necessary for the Barclays Center), then pay, over 21 years, the equivalent of $80 million in 2009 dollars: approximately $173 million, at an implied 6.5% interest rate.

Four days after Cuomo’s announcement, Newsday reported that NYAP was, in fact, getting the equivalent of interest-free financing for the station, and was essentially getting the entire 43-acre site in exchange for payments being reinvested into project infrastructure. One sports economist quoted in the story thought the rail deal was fair while another thought the deal might stimulate the economy, even if the land was a bargain. 

New public revenue?
I have more doubts, and not just because of Cuomo’s record on transparency. Consider: the ESD board meeting July 8 to accept the Final EIS was scheduled with exactly one business day’s notice, a decision that provoked project opponents to protest to the Joint Commission on Public Ethics (JCOPE).

According to Cuomo’s press release, the state-commissioned analysis “found the new arena, hotel and retail village will generate nearly $50 million in new public revenue per year and produce $725 million in annual economic output” (spending, apparently).

Sure, building on underutilized land adds significant jobs and tax revenues, especially from the retail, but Cuomo’s numbers deserve scrutiny rather than blind endorsement.

The state's fiscal estimates ignore the cost of additional public services and infrastructure, as well as the value of various tax exemptions. Unbiased agencies, like the New York City Independent Budget Office, typically weigh benefits and costs. The watchdog group Reinvent Albany has asked ESD for an analysis of Belmont subsidies, without results. (In Streetsblog, Reinvent Albany also raised several questions about the new train station, including operating costs and cost overruns.)

Moreover, the report by BJH Advisors performed for Cuomo doesn’t consider “whether the spending and jobs are moving from one site presently in New York State to the new project location.” That’s said to be reasonable, “given the type and unique nature of the retail uses and the newly generated demand for hotel and accommodation services.” 

Maybe, but that excludes the nearby Nassau Coliseum, clearly an arena rival, as explained below. 

The new luxury outlet mall
And if, as the state says, “there are currently no direct comparable development [sic] to Value Retail's luxury outlet product within the United States,” shouldn’t the developers of such high-end retail be paying for the land?

We haven’t heard much about Value Retail, founded by Islanders’ co-owner Malkin, but Belmont would represent the first United States example of a successful European chain, of which Bicester Village, not far from London, is now the United Kingdom’s second-busiest attraction and generates more sales per square foot than any retail outlet in the world. 

Consider: at 315,000 square feet, if Belmont achieves sales at $2,000 per square foot, that means annual revenue of $630 million, and big success for Value Retail, which typically charges brands 12.5% of sales: meaning $78.8 million in annual rent given that estimated revenue. (Is $2,000 per square foot realistic? Well, sales at less-exclusive Woodbury Common, as of early 2018, were $1,624 per square foot, and Bicester achieved sales of $4,000 per square foot, as of 2016. Even at Woodbury Common results, the Belmont numbers would be formidable.)

No wonder Value Retail founder Malkin has let Islanders’ co-owner Jon Ledecky be the public face of the project. 

Rent goes back into the project
Beyond the rail station financing and tax breaks, the Cuomo administration has figured out how to mask significant public help for what was long portrayed as an “entirely privately funded” project. (Now, I suppose it’s “almost entirely privately funded.”)

Along with that initial $30 million payment for the station, NYAP will pay $20 million upfront for Project Site infrastructure. However, these payments fulfill the developer’s seemingly sweet land lease: announced at just $40 million to control 43 acres for 49 years.

So, instead of paying New York for the site, that money—plus an extra $10 million—goes back into the project.

What about the appraisal?
Is the land worth just $40 million (or even $50 million)? The annual payment, per acre, is but 10 percent of the cost paid for the right to build a “racino” at Aqueduct, another racetrack. In March 2018, ESD promised the Village Voice an appraisal would be done before “the conclusion of the environmental review in 2019.”

Apparently appraisals exist. ESD, in the Response to Comments Chapter of the Final EIS released July 8, said that “The transaction between ESD and the Applicant is a fair market transaction confirmed by appraisals received by ESD.” 

However, ESD has not released them. Despite that July 8 statement, Newsday reported five days later that an appraisal would be complete “in the coming weeks”—just in time for the final approval votes.

The Belmont process suffers from opacity, as I’ve written. A rival bidder for the site withdrew in 2017, citing (to Long Island Business News) “extraordinary requirements, preconditions and reviews” that pointed to a wired deal for a hockey arena; LIBN’s editor opined that the state “only solicited proposals tailor-made for the Islanders and their well-heeled backers.”

Impact on the Coliseum
The claim that spending and jobs won’t move within the state has a huge blind spot: the county-owned Nassau Coliseum, less than ten miles away. The state review fudges the new arena’s likely devastating impact on the Islanders’ former (and now part-time) home, which, after being downsized and renovated, seats only 13,900 for hockey—too small for the National Hockey League—and up to 15,000 for concerts. 

The new arena would seat 18,000 for hockey and up to 19,000 for concerts—and, of course, would contain many more luxury suites. Unlike Barclays, announced in 2012 as the Islanders’ new permanent home as of 2015 but making an awkward fit for the team, it would be built to accommodate hockey.

Asked in the public comment period about the need for another arena, the state responded, “The arena would meet the demand for larger events that cannot be hosted at smaller venues such as Nassau Coliseum.”

Well, it might meet the demand for Islanders games. But it’s dubious that the Coliseum couldn’t host “larger events.” Even at Barclays, which offers far better transit access and a denser population nearby, only a few supernova performers, like Jay-Z and Barbra Streisand, have consistently sold out, while concerts averaged between 9.711 and 11,944 over the first four years, as I reported. Even the Belmont Final EIS (Chapter 7) notes that non-sporting events at Barclays averaged 8,468.

Nonetheless, the Final EIS Project Description chapter quotes the Belmont arena developer without question: “In addition to the approximately 44 to 60 New York Islanders home games, NYAP envisions approximately 145 non-NHL arena event days annually, including: approximately 50 marquee concert/entertainment event days that would fully utilize the arena’s space (approximately 19,000 seats); approximately 65 large to medium event days (utilizing between 6,000 and 11,500 seats), such as Disney on Ice, Cirque Du Soleil, E-Sports, or high school sports; and approximately 30 small or non-ticketed event days (3,500 seats or fewer).” 

“Assuming the above-described events were to sell out at the utilization levels indicated, attendance on arena event days would average approximately 15,000 patrons,” the document states. That’s extremely dubious. Even Madison Square Garden—the region’s premier event venue, in the heart of Manhattan—falls short, averaging 14,825 for non-sporting events, as acknowledged elsewhere in the Final EIS.

If the attendance estimates are overblown, that also lowers the expected number of jobs, and tax revenue from new spending, further undermining the projections.

Dancing around the damage
Another commenter during the environmental review asked how, if visitors to non-sporting events are expected—according to a previous project document—from “a catchment area of no more than a 20-30 minute drive to the arena,” Belmont would compete with the Coliseum. 

The ESD response acknowledged that the arenas “would overlap significantly,” but asserted that “both venues attract visitors from throughout the entire MSA [Metropolitan Statistical Area], which is significantly large enough to absorb the additional supply of events and entertainment.”

That’s an astounding leap of logic. The MSA, while it contains 20 million people, extends to New Jersey and even Pennsylvania. How many people would travel long distances to attend shows at Belmont? Remember, many Islanders fans decided they had little interest in attending weeknight games at Barclays, the team’s temporary home, given the travel commitment. In other words, demand depends on logistics.

The response, however, continued in fantasyland: “One venue might focus on larger shows, both venues could host the same acts on different nights, or perhaps host events marketed at different audiences.”

Sure, events are marketed to different audiences. But most shows too big for the Coliseum don’t exist, as attendance figures show. As to hosting “the same acts on different nights,” that’s not just dubious business practice—why would an arena coordinate with a rival?—but also a logistical nightmare: why would an act that has loaded in equipment and sets move nearby for a second performance?

Where’s the audience?
The Final EIS Socioeconomic Conditions chapter claims that “the Nassau Coliseum would continue to focus on smaller-scale events than those hosted at the Barclays Center and the proposed [Belmont] arena.” When that passage appeared in the Draft EIS, I pointed out—in a January op-ed for the Daily News—that the Coliseum relies on family shows, which Belmont plans to pursue.

That contention remains un-rebutted. Instead, both the Draft and Final documents confidently assert, “Overall, the metro area is considered sufficiently large to comfortably absorb additional non-sporting events from the proposed arena without having a significant impact on the existing venues.” 

Such passive-voice phrasing, backed by no independent analysis, severely undermines the claim and further undermines the credibility of the state review.

***
Norman Oder is a Brooklyn journalist who writes the daily blog Atlantic Yards/Pacific Park Report and is working on a book about the project. On Twitter @AYReport.

***
Have an op-ed idea or submission for Gotham Gazette? Email opinion@gothamgazette.com

Note: this piece has been updated: the original version referenced the 15,000 attendance estimate without including the Islanders' games, and didn't clarify that the MSG attendance figures were for non-sporting events.

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Cuomo’s Getting His Belmont Arena, But the Numbers Don’t Add Up Tue, 23 Jul 2019 04:00:00 +0000
New York Builds on Its Extensive Climate Leadership https://www.gothamgazette.com/130-opinion/8688-new-york-builds-on-its-extensive-climate-leadership https://www.gothamgazette.com/130-opinion/8688-new-york-builds-on-its-extensive-climate-leadership offshore wind gov

(photo: offshore-wind-govMike Groll/Office of Governor Andrew M. Cuomo)


New York Already has the Lowest Greenhouse Gas Emissions Per Capita of Any State in the Nation and is Moving Forward

New York State has just enacted a plan to bring its planet-warming greenhouse gas emissions to 15% of its 1990 levels by 2050 and provide enough “carbon-emission offsets“ like forestation and wetlands reclamation to bring total carbon-emissions to “net-zero“ by that same year. These goals put New York at the forefront of the United States in addressing climate change.

Governor Cuomo had submitted a similar proposal in his executive budget in January of this year, entitled the Climate Leadership Act, but the Legislature did not adopt it in the April budget. Instead, it reformulated the proposal to provide a more highly developed and detailed planning process to implement the transition to a carbon-neutral society and economy by the goal year of 2050.

To be sure, the governor deserves great credit for already moving New York in this direction, using the state’s powers to usher in substantial increases in wind and solar power over the past several years and repeatedly enunciate and affirm goals of increasing renewable energy and setting a policy of achieving 80% reduction in greenhouse gas emissions by 2050. 

In June, the state Legislature passed a bill -- The New York State Climate Leadership and Community Protection Act -- at the end of its 2019 legislative session, which Governor Cuomo just signed into law, creating a broadly inclusive public participation process along with a step-by-step planning and regulatory decision-making structure for the energy transformation.

A Climate Action Council is created consisting of 12 New York State agency heads and 10 non-governmental individuals who will spend several years scoping out a plan to implement the transition and vote to present their recommendations to state government leadership by 2022.

In 2023 the state agencies will then incorporate the recommendations into ongoing regulatory actions to bring the residential, commercial, industrial, transportation, and electricity-generation sectors of New York’s economy toward the greenhouse gas emission reductions needed to reach the goals.

The legislation also mandates that disadvantaged communities, which have borne the brunt of pollution and climate change, share in the benefits of the transformation in a major way, to receive a goal of 40% of the benefits and a legal minimum of 35% of the benefits.

By 2030 New York’s goal will be to reduce greenhouse gas emissions 40% below its 1990 levels, including achieving electricity generation from 70% renewable sources of energy, and a carbon-neutral electricity-generation sector by 2040. The State Public Service Commission (PSC), regulator of the state’s electric utilities, is directed to a more expedited schedule for the electric generation renewable goals since 2030 is in fact not really so far away for this important sector of the state’s economy.

The goals are far from unrealistic, because in part we are much closer to them than many people realize. New York’s greenhouse gas emissions are already nearly 20% below its 1990 levels, according to the 2019 State Energy Patterns and Trends published by the New York State Energy Research and Development Authority. 

 

GHG Emissions by Sector (in million metric tons carbon dioxide equivalent)

               

Year

Residential

Commercial

Industrial

Transportation

Electric

ElecImports

Total

1990

34.3

26.5

20

59.4

63

1.7

205

2016

30.9

20.7

10.2

73.7

27.7

3.8

167

% Change

-9.8%

-22.2%

-48.9%

24.20%

-56%

120%

--18.5

1990-2016

           

 

New York’s electricity-generation system is already in an advanced stage of transformation from a fossil-fuel based system. Coal is nearly gone; only 1% of New York’s electric generation came from coal in 2018, and the last coal-fired plants will be deactivated in 2020.

Only 37% of New York’s electricity use now comes directly from fossil fuels consumed in New York. 16% of New York’s electricity use is imported from Canada and other parts of the United States. There is some fossil fuel use in that mix but it also includes hydroelectric and nuclear power. 26% of New York’s electricity comes from nuclear power, and nearly 20% comes from renewables, primarily hydroelectric power.

The Transmission System Needs Extra Capacity
Although New York’s electricity grid has made major progress shifting from fossil fuels, its transmission infrastructure needs upgrades and new investments to keep up the pace of bringing in more renewable power, according to the Independent System Operator (ISO), manager of the state’s electric grid.

Some wind power produced in Upstate New York has to be curtailed off the grid now because it can’t be economically transmitted downstate due to capacity limitations; the same goes for some Canadian power generation and even some of New York’s own hydroelectric generation. The ISO and the PSC have moved to permit several new transmission-line upgrades to bring power around the state more effectively, from Canada, from western New York to Eastern New York, and from Upstate to Downstate.

The Cuomo administration foresees offshore wind power around New York City and Long Island as major new sources of renewable power, and, once again, the transmission systems need to be upgraded to absorb that wind energy production. When he signed the bill on Thursday, the governor also announced the two winners of a procurement process to add 1,700 MegaWatts of offshore wind power, which may eventually produce about 5% of New York's electric power. It may realistically be 2035 before New York can get to 70% renewable power, but the Public Service Commission is authorized to modify the timetable in the CLCPA to get there.

Several of New York’s nuclear power plants will be deactivated by that time, but several nuclear plants will still be in operation in 2040 and the legislation permits that power to be counted as part of the carbon-neutral goal for the electricity-generation system.

The Independent System Operators’ most recent analysis of New York’s electric grid, Power Trends 2019, even forecasts New York will have the ability to absorb increasing use of the grid by electric vehicles, and that energy storage systems, energy efficiency measures, and demand control systems can manage the electric system’s gradual transition to renewables, along with the investments in new transmission capacity.

New York Energy Use and Renewable Transition
Although there is plenty of attention, and credit for the environmentally-beneficial progress of New York’s electric grid, greater challenges will remain for transportation, industrial, and building energy use. That’s because fossil fuel use in New York’s electricity-generation system is now only 20% of the state’s greenhouse gas emissions. The non-electricity-generation sectors, namely transportation, industry, and buildings in the commercial and residential sectors, emit 80% of New York’s greenhouse gas emissions.

Even if New York eliminated fossil fuel use from its electric generation and electricity import sectors, its greenhouse gas emissions would still be at 66% of its 1990 levels. According to its energy profiles from the United States Energy Information Administration, New York’s current baseline already has the lowest greenhouse gas emissions per capita in the nation among the 50 states, at only 50% of  the national average! New York has the second lowest energy consumption per capita of the 50 states already (Rhode Island is first). 

New York’s efficiencies in large measure predate the big renewable push of recent years and are merely the general characteristics of New York’s economy. Transportation accounts for 44% of New York’s greenhouse gas emissions but it is still cleaner than the rest of the country. The New York City metropolitan area mass transit system carries millions to their destinations using much less energy per capita than the rest of America. New York is 6.1% of the U.S. population but uses only 4% of the energy consumed in the transportation sector of the U.S. (per USEIA, State Energy Data 2016). 

One of President Trump’s chief environmental lunacies is the rollback of President Obama’s fuel efficiency standards for the American automobile industry. But the industry itself is highly resistant to the rollback, as are many states and foreign markets, as well as foreign producers, and progress will continue there.

As the vehicle fleet in New York turns over, efficiency improvements will continue and greenhouse gas emissions will decline. The state government and municipalities will need to promote the transition to electric vehicles and powering them from renewable energy, continue to invest in public transportation -- not just in the New York City metropolitan area but the state’s other communities as well -- and promote alternative methods of transportation.

New York has little in the way of heavy industry and its industrial sector uses only 1% of the energy used in the industrial sector in the United States. But its commercial and residential sectors use energy in closer proportions to New York’s share of the U.S. population. The residential sector uses less electricity than normal because of the high proportion of small apartments in New York City, but overall household energy use is still 15% greater than the average household because of New York’s colder weather and the fuel needed for space heating and hot water. 

Improving energy efficiency in New York’s commercial and residential buildings presents serious challenges. Conservation investments for many homeowners may be too costly because they are of modest means and they will need help and subsidies to improve efficiencies. Commercial and apartment building owners may also find energy investments costly and may need tax incentives to stimulate those investments. But there is time for the residential and commercial building sectors to change.

New York’s new law directs the Climate Action Council to hold public hearings for several years throughout the state as it develops its plans, and the Council must establish advisory panels from different sectors of society, including labor and industry, to examine how to go forward. It must also work with environmental justice and just transition groups with plans for fair treatment and beneficial participation of disadvantaged communities.

New York’s state and local governments will need these inclusive processes to establish buy-in from sectors of society that may be fearful or skeptical of what a transition will look like or how they could be affected. The goals can be achieved, or New York can come very close, with the collaborative process the state has outlined for carbon-neutrality by 2050.

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

 

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Have an op-ed idea or submission for Gotham Gazette? Email opinion@gothamgazette.com

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New York Builds on Its Extensive Climate Leadership Sun, 21 Jul 2019 04:00:00 +0000
Advocates See Irony in Cuomo's Thinly-Veiled Shots at De Blasio Over City Problems https://www.gothamgazette.com/city/8677-advocates-see-irony-in-cuomo-s-thinly-veiled-shots-at-de-blasio-over-city-problems https://www.gothamgazette.com/city/8677-advocates-see-irony-in-cuomo-s-thinly-veiled-shots-at-de-blasio-over-city-problems cuomo bdb amazon

Cuomo & de Blasio (photo: Ed Reed/Mayor's Office)


Governor Andrew Cuomo believes in action, rather than rhetoric, and rarely shies away from criticizing those who he believes fail to live up to their promises, including his fellow Democrats. He’s also appeared particularly irritated by the ascendent progressive wing of the Democratic Party, which has challenged him, unfairly he argues, and offers what he says are pie-in-the-sky talking points over the types of achievable results he’s delivered.

Cuomo brought the critiques together on Friday in an op-ed in the New York Daily News, where he inveighed about underfunded schools, the problem-plagued Rikers Island jail complex and the plan to close it, New York City’s homelessness crisis, and the mismanaged city public housing authority (NYCHA). That same day, Cuomo complained of a rising homeless problem on the city’s subways, calling on the Metropolitan Transportation Authority (MTA), an entity he effectively controls, to confront it in its upcoming reorganization plan. 

But on each of those issues, Cuomo, now in his third term, offered no concrete solutions of his own, and advocates who have watched him hold the reins of power for eight-and-a-half years say his rhetoric distracts from his own policy failures while pinning the blame on others. In this case, the unnamed target was clearly New York City Mayor Bill de Blasio, who is now running for president on what the mayor calls a long list of progressive accomplishments in the nation’s largest city.

In many instances, including the op-ed, Cuomo’s indulges in discussion of “what it means to be progressive” appear to be his attempts to differentiate himself from de Blasio, among others.

“The common denominator of these great failures — Rikers, poor schools, NYCHA — is obvious,” Cuomo wrote in the op-ed, “poor, powerless minorities and basic civil rights violations. Addressing them should be the cornerstone of a true progressive agenda, and yet they continue to languish.” 

He went on to criticize “Democratic failures” that fuel Republican success, before taking a shot at the 2020 Democratic presidential field. “Today, every 2020 Democratic presidential candidate is articulating the same basic ‘progressive’ goals: more economic opportunity, better public education, affordable health care, etc. To me, the far more important question is how we achieve these goals and who has the ability to get it done,” he wrote (Cuomo has repeatedly expressed support for former Vice President Joe Biden). 

The governor all but shouted from the rooftops that the common denominator on all those issues is de Blasio, a favorite target of his criticism despite the long history the two share. Cuomo’s acrimony towards what he sees as faux progressivism is never as obvious as when it’s directed at the second term mayor, and the two have spent more time arguing over issues they agree on rather than working on solutions.

Cuomo has been quick to fault de Blasio for the city’s homelessness crisis, the long-running problems at NYCHA, and what he inaccurately called a “stalled” plan to close Rikers. Inequity in school funding is another area where Cuomo, despite his own significant power to effect change, has taken a cudgel to the mayor. While de Blasio has struggled to varying degrees with each of the problems Cuomo mentioned, the mayor and others have also sought more state support than the city has received.

The mayor’s office clearly understood who the op-ed was targeting. “We agree - being progressive requires more than just talk,” said Jane Meyer, a spokesperson for de Blasio, in an email. “That’s why we back our words up with action. Our plan to close down Rikers is one year ahead of schedule, we have helped over 117,000 New Yorkers avoid or exit shelter, and we are testing 135,000 NYCHA apartments for lead to eradicate exposure.”

It is not lost on many close watchers and stakeholders that the issues Cuomo has railed about, and targeted de Blasio on, have of course been ripe for gubernatorial action, especially from a governor who has repeatedly sought to outshine, undermine, and overstep the mayor, whose shortcomings are not to be dismissed.

But overall, those working on solutions in the areas Cuomo mentioned say his op-ed says as much, if not more, about him than anyone he sought to call out. 

Rikers Island
In a conference call with reporters on Friday, Cuomo repeated his criticism of the Rikers closure plan, saying the state Legislature should have acted to close it long ago and that de Blasio’s plan “was unworkable from the day it was announced” -- a claim that does not appear supported by fact at this point in the process currently unfolding.

Though he was ready to offer help -- “Tell me what you need from the state’s point of view and we’ll be however helpful that we can,” Cuomo said -- he did not provide any concrete ideas. And he seemed to suggest that elected officials in the city would be best served if they moved ahead with the plan despite community opposition, which is what appears to be happening, contrary to Cuomo calling the plan unworkable and stalled. 

Brandon Holmes, the New York City campaign coordinator for JustLeadershipUSA, which has spearheaded the #CloseRikers campaign, chalked up Cuomo’s rhetoric to a “political game” with the mayor and one that undermines a successful ongoing effort to move towards a closure of the jail complex. Instead, he called out Cuomo’s yearslong efforts to either oppose or water down criminal justice reforms making their way through the state Legislature. 

Holmes noted, for instance, that Cuomo opposed the complete elimination of cash bail (it was severely limited for use in non-violent offenses under new legislation this year, which will be a big boost to the Rikers closure efforts given the expected reduction in remand), did not voice support for reforms to the parole system or eliminating solitary confinement.

“Cuomo didn’t support all of these things that would not only improve conditions for people who are currently incarcerated but also ensure that thousands more New Yorkers would never come into contact or return to prison in the first place, and he didn’t support any of that,” he said. “This is really just a political move. I don’t know what games he thinks he’s playing but he really should stay out of the picture and allow advocates and people who are formerly incarcerated to continue leading this movement to decarcerate New York which we’ve had to force him and drag him along the way to doing.”

While Cuomo did champion major bail and other criminal justice reforms that did move this year after Democrats won the state Senate, the governor’s critiques of de Blasio’s efforts to close the Rikers Island jails appear to boil down to calling the timeline too long, which is certainly debatable, though the governor has not followed up that criticism with anything concrete, and the unfounded jabs at the replacement plan, which is moving through the city’s land use review process.

Homelessness
Cuomo has repeatedly criticized the rise of homelessness in New York City, which continued to climb during de Blasio’s first several years as mayor but has plateaued after billions of dollars in additional spending by the city administration. De Blasio has himself repeatedly mentioned homelessness as his biggest failing as mayor, where he said he did not quickly enough grasp the magnitude of the problem and how many city resources needed to be dedicated toward it.

But Cuomo’s more recent tirade was directed more specifically at homelessness on the subway system. “[I]t's something we've all lived with as New Yorkers, but what's striking to me is how much worse it is and it's not just a question of looking at the numbers and the statistics, it's visibly worse,” said Cuomo, who has not ridden the subway in two-and-a-half years, on the press call. 

Cuomo called on the MTA, which is currently undergoing a top-to-bottom reorganization of its bureaucratic structure, to tackle the issue without relying on assistance from the city, while he again appeared to distance himself from actually providing state help.

“We need social service outreach workers. We need police in a supporting role. We need transportation accommodations. And the MTA has to have a concerted, efficient, professional effort where outreach workers make contact with homeless people on trains and in terminals doing assessment on-site as to the issues that are being presented by the homeless individual,” he said. “If the homeless individual is violating the laws or the regulations of the MTA, then help that person get the assistance they need. Be it a shelter, supportive housing, mental health facilities.” 

But the governor’s comments about additional policing, just a month after a separate announcement that the MTA would add 500 new police officers to patrol the subways for fare evasion (funded by the Manhattan District Attorney’s office), struck some experts as misguided.

Jacquelyn Simone, policy analyst at nonprofit Coalition for the Homeless, said in a statement Friday that the state should redouble its investments in permanent solutions such as affordable and supportive housing. “However Gov. Cuomo’s reference to increased policing of homeless people in the subways is misplaced,” she added. “We have always advised State and City leaders that the answer is most definitely not more policing because summonses and harassing vulnerable people to make them move simply pushes them deeper into the shadows without helping them obtain the services and housing each one of them needs. If Gov. Cuomo wants to fix the problem, let him step up with more housing and services specifically targeted for homeless people, stop shifting the cost of shelters off to localities, and stop the prison-to-shelter pipeline from the State’s correctional facilities.”

Cuomo’s has touted state investments in affordable and supportive housing, but experts have shown it has been slow to materialize, and the governor has refused to support a more significant state investment into housing subsidies that the city has provided to those leaving shelter.

JustLeadershipUSA’s Holmes offered rhetorical questions: “He comes out with this investment saying he’s gonna fund additional police officers into the MTA to solve those problems. What if he actually put that money towards providing permanent housing for people who are experiencing chronic homelessness? What if he put that money into repairing public housing buildings across the city?”  

NYCHA
The city’s public housing authority has suffered a series of setbacks and self-inflicted problems over the last many years, not the least of which involved the falsification of lead inspection records that led to a federal lawsuit and eventual oversight from a federal monitor. The authority also has an estimated $32 billion capital repair backlog, though the de Blasio administration was able to bring its operational expenses under control after years of deficits, in part by putting more city funds toward the authority.   

For over two years, however, while the agency faced investigation, Cuomo has refused to release about $450 million in state funding allocated for repair and maintenance, citing the agency’s mismanagement. “Progressives all espouse the need for affordable housing, but the incompetence of NYCHA has been tolerated for years with children being housed without heat and exposed to lead poisoning, without any coherent solution,” Cuomo said in his op-ed.

The governor also seized on NYCHA as an issue last year, as he was running for a third term, holding a number of NYCHA-related government events at various public housing developments, promising some conditional funding, and threatening a state monitor, pending the outcome of the federal examination.

The governor has not been a frequent NYCHA visitor since winning his primary last September, and he did not allocate any additional NYCHA funding in the new state budget passed April 1.

School Funding
“On public education, I think the op-ed is a bit of an indictment of his own policies,” said Billy Easton, executive director of the Alliance for Quality Education, an education advocacy group, and a frequent Cuomo critic who supported the governor’s primary opponent, Cynthia Nixon, in last year’s election.

AQE has long pushed for fully funding the Campaign for Fiscal Equity court decision, which would require billions more in state “foundation aid” funding for underfunded schools in poorer schools districts. Cuomo has repeatedly denied that funding, arguing that the state has no remaining obligation under the CFE decision, and this year pushed his own alternative “education equity” formula that would require districts to direct more funding toward their poorer schools.

In his op-ed, Cuomo critiqued the state Legislature for failing to increase funding for poorer school districts without also increasing funds for richer ones, but his formula accomplishes the same outcome. The governor pushed through additional requirements for New York City to report on how state education aid is being delivered to specific schools. 

“He has utterly failed to deliver for high-need schools in this state,” Easton added. “This year the Legislature proposed a plan that would increase funding over the next four years for high-need school districts by $3 billion and he aggressively blocked it.”

Cuomo has at once touted that the state continues to increase overall education funding to record levels each year, and also said that the state cannot keep throwing more money at education, citing the highest per-pupil spending in the country, by far.

He’s backed an expansion of charter schools, particularly in New York City, an effort that stalled this year under full Democratic control of the Legislature despite the state cap on charters for the city having been hit. De Blasio and Easton are staunch opponents of charter schools, which supporters point out often deliver better education than traditional public schools in low-income communities of color, while critics say they often don’t educate representative student bodies, are test-prep factories, and starve district schools of resources.

Easton derided the governor’s so-called pragmatism as one driven more by fiscal conservatism, and noted that the disparity in per-pupil funding between richer and poorer school districts has only gone up under Cuomo’s tenure (though the Legislature certainly has a hand in that as well). 

“I think he’s just lashing out. He’s lashed out at de Blasio, he’s lashed out at AOC, he’s lashed out at Cabán,” he said. “He’s lashing out at anyone who’s actually a progressive. He wants the definition of progressive to probably be center-right like he is. That’s just not the reality. The truth is, what the op-ed also shows is that progressives are defining the agenda that Democrats have to respond to. He’s got that intuition, he’s always had the intuition that he needs to brand himself as a progressive but he’s a lot better at branding than he is at delivering on some of the most important progressive priorities.”

***
by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

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Advocates See Irony in Cuomo's Thinly-Veiled Shots at De Blasio Over City Problems Tue, 16 Jul 2019 04:00:00 +0000
A French Lesson in Fare Evasion https://www.gothamgazette.com/130-opinion/8668-a-french-lesson-in-fare-evasion-mta-cuomo https://www.gothamgazette.com/130-opinion/8668-a-french-lesson-in-fare-evasion-mta-cuomo govcuomo 96th

(photo: Kevin P. Coughlin/Office of Governor Andrew M. Cuomo)


I just returned to New York City from a month in Paris, where my husband was doing legal work. A regular public transit user at home, I was the same in Paris, making use of its Metro system. But because I did not inform myself of all the rules, I violated one of them and had to pay a fine. The experience helped me think about the fare evasion challenge we’re dealing with in New York. 

As in our subway system, there is one fare to travel throughout the city on the Paris Metro. I bought discounted “carnets” of 10 tickets at a time at a cost of about 14.90 euros, approximately $18. The tickets are small white cards; you put them in a slot on the way in, and if the ticket is valid it pops up in another slot to be retained; high plastic doors then open to let you through. When you leave the station at your stop, you walk through exits (sorties), which have high doors that open when you press on them with your hand.

Since there is no need to use the tickets to exit (they are needed at stations where you transfer to rail connections) and they are only good for one fare, I was throwing them away after entering a station. Of course this was silly of me; why wouId the entrance machines give you back the tickets if you weren’t supposed to keep them? But I wasn’t thinking it through and didn’t want to get used tickets mixed up with new ones from my carnets.

After a few weeks, while transferring between one train line and another at Gare St. Lazare, a major metro transfer point, I encountered a line of transit employees (they have orange vests like our MTA New York City Transit workers) stopping passengers walking through a tunnel. They asked to see my ticket.

In halting French with English mixed in I explained that I had thrown it away. Non, non madame, said one of the inspectors.  You must retain your ticket. I shrugged, explained that I was a tourist, that I had been using the system for several weeks and no one had stopped me, and said I would go and buy a new ticket to present to the inspection team. Non, non madame, one of them said; you have to pay a fine right now.

She showed me a chart with different fines for different types of violations. I was shocked at how high they were. She ‘settled’ for a payment of 30 euros, about $35, whipped out a handheld charge machine, inserted my credit card and gave me a special receipt. The same thing was happening to people around me, who contended they had lost their tickets or didn’t have them for whatever reason. 

At about the same time this happened to me in Paris, back home in Manhattan Governor Cuomo announced a comprehensive fare evasion deterrence program for the subways and buses, including the assignment of 500 personnel, including New York City and MTA police officers and 70 “Eagle Team” members, as well as a number of structural changes like securing emergency exits at subway stations and installation of video cameras.

Fare evasion has been a growing problem on New York City subways and buses in the last few years, according to the MTA. An MTA report issued in March estimated annual lost revenue due to fare evasion at $225 million in 2018; the projection for 2019 had grown to $260 million by the time of the governor’s June press conference.

The problem is particularly acute on buses where one of every five riders doesn’t pay the fare, the MTA says. It is infuriating to sit on a bus and watch others simply walk on without paying; drivers cannot be expected to take the risk of arguing with these passengers. But it is also a problem on the subways; I am sure everyone reading this column has seen people walking into stations through the emergency exit doors.

Stopping fare evasion should not be about criminalization or persecuting poor people—it’s about the money. Evasion hurts all transit riders by depriving the system of much-needed revenue and making the costs higher for those who do pay. $260 million a year is A LOT of money – enough, for example, to pay for half-fare Metrocards for all low-income riders eligible under the recently adopted “Fair Fares” initiative by the City Council and Mayor de Blasio. The worthy program should be fully implemented as quickly as possible and soon evaluated for possible expansion.

The heightened presence of law enforcement personnel and other initiatives to discourage fare evasion in the new plan are all worth trying, but they must be done carefully. And I suggest that, in addition, the MTA consider doing what the French are doing in the Paris Metro. It is not as big as New York’s system, of course, but does carry more than 4 million people a day and is the second busiest in Europe (after Moscow). It devotes 1,200 staff to fare evasion.

Instead of issuing summonses for non-payment that can be ignored with minimal – and no immediate – consequences, the Paris inspectors assess “penalty fares” that must be paid on the spot; 1 million of these penalties are issued a year in Paris. 

New York City Transit, the MTA’s division that runs the subways and buses, should explore using  the technology that Paris has employed to give members of the Eagle Teams who go onto buses to look for evaders hand-held devices that can check whether someone’s Metrocard (if they have one) has been used for that trip and if not, charge and collect a penalty fare, much higher than the regular fare but lower than the $100 civil fine for fare evasion. Do the same in the transfer tunnels in large subway stations like Penn and Grand Central.

Those who want to challenge the fine or cannot pay on the spot should have the option to pursue administrative appeals, but I strongly suspect this method will have more of a deterrent effect than simply issuing paper summonses to everyone. I certainly was very careful to save my Metro tickets after this happened to me!

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Carol Kellermann was president of Citizens Budget Commission from 2008 through 2018.

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Have an op-ed idea or submission for Gotham Gazette? Email opinion@gothamgazette.com

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A French Lesson in Fare Evasion Mon, 15 Jul 2019 04:00:00 +0000