The loss of congestion pricing revenue will affect more than just the long-term expansion of the MTA’s transit system — it could leave aging subway cars to run on poorly maintained tracks and sideline normal repair and replacement activities for years, a Daily News analysis has found.
The potential budget hole is so deep that If the MTA cut every new train car, locomotive or bus out of its current capital plan — a move that would leave the LIRR’s obsolete M3 in service, keep 80s-vintage R68 subway cars on the B, D, N, Q, W and Franklin Ave. Shuttle lines, and possibly leave some 70s-era R46 subway cars on the A, C, N, Q and W lines — the transit agency would still be in the hole for remaining repair costs to the tune of $2 billion.
“The reality is that the MTA will not be able to do the nuts and bolts repair projects needed to keep the system from falling apart without congestion pricing,” said Rachael Fauss, senior policy advisor for Reinvent Albany, a government watchdog group that supported the tolling plan.
“There is no viable Plan B that will not cannibalize future revenue sources from the upcoming 2025-2029 capital plan, which will also have massive costs for repair and replacement projects,” Fauss added.
With Hochul’s abrupt about face on congestion pricing, the loss of $15 billion in expected bond revenue from the congestion tolling program has left the MTA scrambling to cover $28 billion in projects with only $13 billion to spend.
The News’ analysis found that a massive 78% of that outstanding budget — nearly $22 billion — is for what the MTA calls “normal replacement” or “state of good repair” work — work agency brass says is necessary to keep the system safe and running.
And, since Gov. Hochul’s indefinite pause on congestion pricing — and failure to identify alternative revenue streams — that figure is $9 billion more than the MTA has.
The congestion pricing toll — a planned charge of $15 or more a day to motorists entering surface streets in Midtown and lower Manhattan — had been expected to raise $1 billion a year in revenue. That regular revenue, in turn, was expected to serve as collateral on $15 billion in bonds that the MTA was told by state lawmakers to use toward the current capital budget.
But now, unable to count on $15 billion they thought they had, the transit agency’s budget gurus are conducting triage — trying to figure out what of the $22 billion in maintenance and replacement can get kicked down the road, and what needs to stay. The task has been assigned to Tim Mulligan, MTA’s deputy chief development officer, who’s been charged with taking a hatchet to the agency’s current capital plan.
MTA officials have acknowledged that maintenance work will suffer without additional funding — but they’ve been reticent to say just how much repair and replacement work could need to be cut. “We’re probably not going to be able to do all of the ‘state-of-good-repair’ work,” MTA chairman Janno Lieber said earlier this month after Hochul put congestion pricing on pause, “we have to prioritize.”
The MTA declined to comment for this story, stating that Mulligan is expected to present his bare bones budget to the MTA board at its upcoming meeting on Wednesday.
But it’s expected that the most expensive repair and replacement items — new subway rolling stock — will be the first on the chopping block.
As drastic as that sounds, even that will barely make a dent.
Despite some trouble with the gearbox on a few early trains, the shiny new R211 train cars that entered service last year have been largely seen as a success — replacing aging R46s on the A line and ancient R44s on the Staten Island Railway with modern amenities like wider doors, LED lighting, and the ability to operate with modern computer-based signaling.
The MTA was expecting to purchase an additional run of 437 R211s for $1.4 billion, meant to replace the 80’s vintage R68s, which average a breakdown every 130,000 miles. The system’s newer cars can regularly run 300,000 miles or more before mechanical failures that require them to be taken out of service..
Another $1.1 billion had been set aside towards an R211 counterpart cars capable of running on the subway system’s numbered lines — known internally as the “A division.”
In a worst-case budget scenario, the MTA could even try to back out of a partially-fulfilled, $1.9 billion contract option with Kawasaki for 640 R211s, necessary to continue phasing out the old R46s on the A and C lines. Those cars, first introduced in 1975, average a mechanical failure once every 50,000 miles, according to MTA records — more than four times as often as modern rolling stock.
“It’s a lot of money,” said Lisa Daglian, head of the Permanent Citizen’s Advisory Committee to the MTA, said of rolling stock costs.
“But its also a lot of time on hot platforms, waiting for hot train cars that might not come,” she said of the prospect that new rolling stock could get cut.
Even if both rolling stock programs are axed, it will still cost the MTA some $19.5 billion to keep the system running as planned — $6.5 billion more than it has to spend.
Backing out of the existing Kawasaki contract — if possible — wouldn’t save the MTA more than $1.75 billion.
And if the MTA cut or delayed the expected M9A car for the LIRR, locomotive replacements on both LIRR and Metro North, and every new bus, diesel-powered or electric, the remaining maintenance work would still cost over $15 billion, according to the MTA capital plan. That’s $2 billion more than the MTA has on hand.
That list of projects includes jobs as varied as the $600 million replacement of the Jamaica Bus Depot, $82 million in fire alarm and sprinkler replacements, and many millions in track replacement, structure repainting, repairs to bridge spans, and upgrades to substations and updates to pumping systems.
If, as Lieber has indicated, all $13 billion in the MTA’s capital pot go toward repair and replacement work, then other projects — like a planned $7.7 billion “phase two” extension of the long delayed Second Ave. Subway into East Harlem — will have to be delayed into the next capital plan.
That could turn the Second Ave. subway back into a “zombie project,” said Eric Goldwyn, a professor and program director at NYU’s Marron Institute of Urban Management.
“If push comes to shove, you’ve got to maintain your system rather than expand it,” Goldwyn said. “Historically, that’s what’s happened. The buses have to run on time. The stations can’t be crumbling.”
The MTA announced this week that it had issued a stop-work order on the only contract yet awarded for Second Ave. subway’s phase two, a utlility-relocation contract worth $182 million.
“We have in a couple of cases issued stop-work orders on projects that do not strictly meet our ‘state of good repair’ requirement,” MTA’s construction and development head Jamie Torres-Springer said Tuesday.
But if the MTA waits too long to expand the Second Ave. subway, it risks leaving serious money on the table.
A federal grant of $3.4 billion towards the project — which would extend service north from E. 96th. St., to three new stations at E. 106th St. and Second Ave., E. 116th St. and Second Ave., and E. 125th. St. and Lexington Ave. — will disappear if the MTA can’t pony up a “local match” of $4.3 billion.That money, along with the $22 billion for repair and replacement work, was supposed to come from congestion pricing bonds.
Hochul has repeatedly said that she remains committed to both the Second Ave. subway expansion and the MTA’s necessary repair work.
“There is no lack of creativity around the ability to find the necessary funding sources to offset loss — complete loss [or] partial loss — in one area [of the budget] with other areas that can get us to the billion dollars that is required to allow projects like the Second Ave. subway to go forward,” she said at a press conference Thursday.
Asked by The News how Hochul planned to fund the $4.3 billion required to keep the Second Ave. subway’s federal grant money in play while also funding at least $2 billion in needs for repair work, a Hochul spokesman reiterated the governor’s commitment while providing no details.
“As the Governor has made clear, she is committed to funding the MTA and its Capital Plan, and is working with partners in government on funding mechanisms for the MTA while congestion pricing is paused,” Hochul’s communications director, Anthony Hogrebe, said in a statement.
With Cayla Bamberger
