ALBANY—New York State Comptroller Thomas DiNapoli has issued a report that warns that the Metropolitan Transportation Authority‘s next capital program could face a funding gap of at least $12 billion.
While he notes that the MTA has made significant progress in repairing and modernizing the regional transit system, a great deal of work remains and financing these capital investments over the next 20 years will be difficult.
“Millions of New Yorkers rely on the MTA transit system and while it is in far better condition than it was 30 years ago, much more needs to be done,” DiNapoli says. “The MTA has to find a way to finance improvements without putting the financial burden on riders. This can be achieved only by working closely with the federal government, New York State and New York City to develop a long-term financing program and by using resources effectively and efficiently. Otherwise, needed repairs will be pushed even further into the future, and fares and tolls could rise even faster.”
The State Comptroller says that the MTA’s $90 billion in capital investments since 1982 have not been sufficient to keep its transit system in a state of good repair. He says the sub-par conditions could be blamed on the agency not receiving all of the funding it had sought and cost overruns on large capital projects, such as the East Side Access job, which is now projected to cost $10.7 billion, double its original estimate.
The current 2010-2014 capital program had an initial funding gap of $9.9 billion, which was closed mostly by reducing the size of the program and by increasing borrowing. Borrowing for the 2010-2014 capital program is projected to reach a record $14.8 billion, which represents 61% of the program’s $24.3-billion estimated cost. Debt service (excluding the cost of the 2015-2019 capital program) is forecast to exceed $3 billion by 2018, triple the level in 2005. That debt service could reach $4.4 billion by 2025 if the MTA borrows to fill the funding gap for the 2015-2019 capital program, the State Comptroller says.
The MTA estimates that it will need to invest $26.6 billion during 2015 through 2019 to maintain and modernize its assets. Billions more will be needed to finish current expansion projects, such as future phases of the Second Avenue Subway.