August 19, 2025 • 17 mins
MTA Chief Financial Officer Jai Patel talks fare increases and subway ridership recovery amid the Trump administration's effort to roll back congestion pricing. Patel also discusses fare evasion and the MTA's efforts towards enforcement. She speaks with Bloomberg's Tim Stenovec and Emily Graffeo.
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Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:07):
The MTA runs New York City subways, buses, and commuter
trains that six million people rely on each weekday, and
on Monday, board members approved close to a two billion
dollar contract to expand the Second Avenue subway line into
East Harlem. Jpitzel is the CFO of the MTA. She's
charged with quite the task, which I think is fair
to say many would find unenviable, charting a sustainable path
(00:31):
through one of the agency's most financially trying periods in
its six decade history. She joins us here in the
Bloomberg Business Week studio. Jay, Welcome, how are you.
Speaker 3 (00:40):
I'm good, how are you? Tim?
Speaker 4 (00:41):
Thank you for having me.
Speaker 2 (00:42):
Yeah, thanks so much for joining us. I want to
start with the numbers and just ridership here. Weekday subway
ridership is still twenty five percent below pre COVID levels
in your modeling, does that ever come back to where
it was?
Speaker 3 (00:55):
I you know, we have a financial plan that's a
five year period, and originally we were projecting that we
would see our subway ridership up to ninety percent, but
a couple of years ago we revised that because we
weren't seeing that, but we're hopeful we see an eighty
percent by twenty twenty nine ridership.
Speaker 4 (01:13):
Recovery for subways.
Speaker 3 (01:15):
But on the railroads, we're seeing that recovery even higher.
Today we see eighty five percent ridership recovery on our railroads,
which is amazing, something that we thought was going to
be slower our railroad customers than our subway customers originally
coming out of pre pandemic.
Speaker 2 (01:31):
So is there a way to tap into that growth financially,
perhaps with higher prices for those commuters rather than here
in the city for subway and bus riders.
Speaker 3 (01:43):
So you know, what we have is very small, predictable
far increases that help balance the financial plan, and so
we don't want to burden one rider or over another.
It's really about distance space and commuters, and so we
keep that equitable.
Speaker 4 (01:59):
You know that we do two.
Speaker 3 (02:00):
Percent fare increase every other you know, every other year,
and that keeps our financial plan and balance.
Speaker 5 (02:07):
How do you plan to get that number, I think
you said eighty percent ridership? How do you bring people
back into the subways?
Speaker 3 (02:15):
We bring writers back by providing reliable on time performance. Right,
our service matters to customers and delivering the service that
we promise and schedule is something.
Speaker 4 (02:26):
That we strive for. But also safety.
Speaker 3 (02:29):
Our customers need to feel safe safe, and our customers
feel that right. We've had the lowest safety you know
numbers or crime numbers in July, and so our customers
are telling us.
Speaker 4 (02:41):
That by taking the subway, but also.
Speaker 3 (02:44):
Our customer surveys right tell us that customers are satisfied
with the service that we're providing.
Speaker 2 (02:50):
The MTA phases it combined one point one billion dollar
deficit over three years starting in twenty twenty seven. It
already owes close to fifty billion dollars. It needs to
spend sixty eight billion dollars more for vital improvements. There's
some federal aid that's up in the air. The Trump
administration is trying to roll back congestion pricing. What's the
backup plan if the aid EVE operates and the President
(03:13):
is successful in rolling back congestion pricing.
Speaker 3 (03:16):
You know, Tim, I would be remiss if I didn't
mention that. Back in twenty twenty three, we were the
first transit agency to solve our fiscal cliff thanks to
Governor Holcal, chairliber and the legislature, we were able to
come out of a deficit unlike any other transit agency today.
You've heard SEPTA's facing deep cuts Chicago, but we were
(03:36):
the first to say we need state, federal and local aid,
and we got our state federal funding for us. We
also as the MTA contributing to our solving our deficit. Right,
the MTA contributes five hundred million to operating efficiencies, and
those deficits that we have in twenty seven and twenty
eight and twenty nine are very small compared to our
(03:58):
operating budget, and we are committed to doing our part
in saving money to help ensure that we can balance
our budget in the out years.
Speaker 5 (04:07):
We were talking a little bit about the base fares
of subways increasing regularly. I'm wondering if there is there
a set area within the MTA that that revenue goes toward.
Because the base fare for a subway in New York
City it's expected to increase to three dollars in January.
Speaker 3 (04:25):
Correct, So our fares help our operating budget, right, So
they seventy percent of MTA's cost our labor and fringe,
and so that pays for seventy thousand employees and then
the small fraction is for the non labor contract, so
every fair contributes to operating cost.
Speaker 2 (04:45):
On our side, let's talk about fares and fair evasion.
Usually when we talk fair evasion, I think of people
jumping over subway turnstyles, and I know there have been
some mitigation efforts in place. But I took the bus
to LaGuardia on Thursday. It was a great experience. But
when I got on the sp Bs and Queens, I
got on it was like an articulated bus, so you know,
it was a long one. I got off and on
(05:06):
in the back and out of like more than half
a dozen people, I think I was the only one
who paid, And I was thinking to myself, I didn't
know it was optional to pay to get on the bus.
Speaker 1 (05:15):
What are the numbers there?
Speaker 3 (05:17):
So it's not optional right to pay the fair. We
are encouraging every customer to pay our pay their fair share.
Speaker 2 (05:23):
To but there's no enforcement on the bus.
Speaker 3 (05:25):
So there's a couple of things that we're doing for
fair evasion. And our chair has been tackling this first
when he became chair. So on the subways you've heard
of us talking about we're doing fins, sleeves, gate guards
enforcing the exit gate, which is the fair you know,
evasion highway. And so we've made great strides on the subways.
(05:46):
We've reduced fair evasion in over a year by thirty percent.
We've dropped that rate from a high of fourteen percent
to nine point eight percent, So we know those efforts
are working. On the buses, it's a little bit more difficult,
but we're also working there.
Speaker 4 (06:02):
We've decreased fair.
Speaker 3 (06:03):
Invasion on our buses as well in the last year
from fifty percent to forty four percent because all the
tactics the President of New York City Transit is employing.
Speaker 4 (06:13):
We have eagle teams that are looking, you know.
Speaker 3 (06:15):
On different bus routes to make sure that they are
enforcing the pay your fare right.
Speaker 4 (06:21):
Our bus operators.
Speaker 3 (06:22):
Do their due diligence, but really our eagle teams are
enforcement out there riding different routes and making sure customers
fair pay their fare or they're getting a summons or
they're getting off the bus. And that's how we're working.
Speaker 4 (06:35):
How does that work?
Speaker 5 (06:36):
Because I heard of a friend who was on a
bus and someone had come around and like scanned their
phone to see if they had paid the fare. Is
that how it works explained to us.
Speaker 3 (06:46):
So right now what we are doing is if you're
boarding the bus, you have to pay, because there's two
different ways you can pay right today is the Metro
card and the OMNI, and when we go to full
OMNI next year, there's going to be proof of payment.
And so what you can do is European style proof
of payment for customers is you can tap their phones
or credit cards the method of payment to see if
(07:07):
they pay their fare and if they didn't pay their fare.
That's something that we will work with on a summons
or you know, you need to pay your fare for
our customer, and so that's something that's coming. We're really
excited about that for OMNI and proof of payment, but
right now there's two different methods and so we're working
on different ways to combat fair evasion.
Speaker 2 (07:27):
I want to talk a little bit about proposals from
mayoral candidates or in Mumdani. For example, it's proposal to
make all New York City buses free. What do you
think of that and does it create a sort of
a two tiered mass transit system where people who ride
buses don't pay for it, but then people who ride
the subway do and then kind of offset like people
not necessarily taking the right mode of transit for their destination.
Speaker 3 (07:50):
So we've heard the maurial candidates proposal for a fair
free buses. What I'd like to emphasize again is fairbox
revenue is important to the operations of the MTA. It's
twenty six percent of our revenue, and buses is about
a billion dollars in the out years of revenue for
the MTA bus for the MTA, excuse me, and that's
(08:12):
important to us, and so we want to make sure
revenues equal service. And that is something that's hypothetical right now,
but we rely on fairbox revenue.
Speaker 2 (08:24):
So you said a billion dollars in revenue is what
it brings in. Mom Donnie estimates that's about seven hundred
and fifty million dollars annually to make buses free. Is
that an accurate assessment on his part.
Speaker 3 (08:34):
I think there's pieces that he's he's looking at just
the New York City Transit bus fair We have MTA
bus that we also run that the city contributes to,
and that is also fairbox revenue for buses.
Speaker 2 (08:45):
So what would take away that revenue from the MTA
due to the authorities finances or would it just be
I mean, look again, it's a proposal, you said, it's
something that you know is not a plan yet. But
to be fair, he is by far the favored candidate,
and there are a lot of questions about what power
he has to actually follow through with a campaign promise
such as this. But this is certainly a central part
(09:07):
of his campaign, so you got to be looking at
it closely.
Speaker 3 (09:09):
We are looking at it. But one thing that I
would like to emphasize right right now in New York City,
fares are affordable. We make transit and buses the most
affordable at two dollars and ninety cents, and it's affordable
with fairfares, reduce fair for our customers. But you know,
it is something that we will look into as the
mayoral candidate has proposed.
Speaker 5 (09:32):
What about mitigating climate issues that affect particularly the subway stations.
You go online, you see videos of flooding in station,
trying to.
Speaker 1 (09:41):
Get home and on a rainy day.
Speaker 5 (09:43):
Right and water in the subway station. Do you guys have,
at least as part of the upcoming capital plan, a
plan in place to update the infrastructure.
Speaker 3 (09:53):
A couple of points on that right, A couple of
the issues that arise in the subway systems are not
the MTA's fault. New York City right contributes to the
flooding issues that we face in the subways, whether it's
through dep manholes, the sewage. So that is one aspect
of the flooding that you see on the New York
City Transit. But our historic capital plan that sixty eight
(10:16):
point four billion dollars does have climate resiliency of hardening
the system in certain stations in proposed And therefore.
Speaker 2 (10:25):
Let's talk a little bit about congestion pricing. Not as
hot of a topic as it was a few months ago,
it seems like it's died down a little bit in
your view.
Speaker 1 (10:37):
Is it working?
Speaker 3 (10:38):
Congestion pricing is working. It is reducing traffic by eleven percent.
Speaker 4 (10:42):
What does that mean?
Speaker 3 (10:43):
Seventy thousand cars are off the road every single day.
Speaker 4 (10:47):
What else is it doing.
Speaker 3 (10:48):
It's moving our buses faster, it's moving people faster. We've
seen a change in ridership, but also we've seen safety increases.
Speaker 4 (10:56):
There's a fourteen.
Speaker 3 (10:57):
Percent decline in pedestrian crashes. And on top of it all,
it is bringing in the revenue that we had projected originally.
Speaker 2 (11:05):
It's being watched very closely, not just by proponents and
opponents of it, but also by other cities that might
want to put this into practice. Have you or has
the MTA heard from other cities about congestion pricing, about
the model and about questions about implementing it in their
own cities.
Speaker 3 (11:21):
The MTA has heard from other cities and transit properties
and engaged with them to have conversations about the process
that New York implemented for the successful congestion pricing program
that we're having, So they're looking at it at us
as a model.
Speaker 5 (11:36):
We have to ask about the second Second Avenue subway
expansion as well. Just walk us through some of the
plans and the timeline here, because this has been something
that's been in the work, something that any New Yorker
who's lived in New York for.
Speaker 1 (11:51):
The last ford how many years, forty decades.
Speaker 3 (11:53):
Fifty yards fifty I think we've talked about that at
our special board meeting on Monday.
Speaker 4 (11:59):
You know, the contract that our board just approved.
Speaker 3 (12:02):
Is almost one point nine billion dollar contract to start boring, right,
what does that mean? It's starting the tunneling for the
three stations that are vital to Second Avenue Subway Phase two.
And we are committed to expanding Second Avenue Phase two
here at the MTA, and we think it's going to
be a great service to our customers. It's going to
(12:29):
serve about one hundred thousand customers in addition to the
two hundred thousand customers that's Second Avenue Subway Phase one
serves today.
Speaker 5 (12:38):
Do you have a timeline or an expected timeline.
Speaker 3 (12:41):
I think the twenty thirty two was the service date
that we have said publicly.
Speaker 2 (12:48):
It's a very like I said at the beginning, it's
an enviable task that you have ahead of you. Some
people would argue, I would imagine that you spend quite
a bit of time studying other transit systems around the
world's worked and what hasn't worked. If you could waive
a magic wand here in New York City to overcome
some of the barriers that the MTA has experienced, whether
(13:09):
they're financial barriers, whether they're CAPEX barriers, what.
Speaker 1 (13:13):
Would those be like?
Speaker 2 (13:14):
What is the biggest obstacle to making the service even
better here?
Speaker 3 (13:18):
So I think tim one thing that I would say
is MTA is a leader and being the largest agency
in North America, other agencies look to us. I think
I said this before we led with the fiscal cliff,
we lead with our capital program as well. We have
started to do things differently since Janel Lieber took over
for CND and now Jamie Torres Springer. We do design, build,
(13:41):
we do faster, cheaper and better. But we're employing definitely
different ways of doing capital programs as well as operating
for us to be better.
Speaker 2 (13:55):
I want to go back to congestion pricing and some
financial questions around at specifically about selling debt off of revenues?
Do you have plans to sell debt off of revenues
from congestion pricing?
Speaker 3 (14:08):
So, as you know, the congestion revenue is dedicated to
the twenty to twenty four capital program. It is expected
to generate fifteen billion for that program, and once we
see a stable market in the revenues coming in.
Speaker 4 (14:21):
We do plan to issue debt. We've talked about it.
Speaker 3 (14:24):
That's not sometime until twenty twenty six for US. Once
we see a comfortable stream of revenue. We've projected five
hundred million for the next three years and we want
to make sure that we see that revenue and the
markets are comfortable issuing that debt for us.
Speaker 2 (14:38):
You've talked about fare increases on MTA services, what about
increases in congestion pricing?
Speaker 1 (14:45):
And what is the timeline for that?
Speaker 3 (14:46):
So, as the governor has said to us, right, it's
the toll will continue to be nine dollars for three years,
then it'll increase gradually to the next three years at
twelve dollars, and then in the final the seventh year,
it'll be a fifteen dollars. SI is a toll, So
we've already had that phased in based on the schedule
(15:06):
we approved.
Speaker 2 (15:07):
Can you just bring us I know there's litigation around
this with the federal government and with the state, but
can you just take us into conversations that you've had
with counterparts at the Department of Transportation over the last
few months about making sure that the MTA stays on
a sustainable financial path.
Speaker 3 (15:25):
So I think you know what I would say is
the federal government contributes two billion dollars to the MTA,
and that's a revenue source that we rely on to
keep the system in a state of good repair, and
so we would continue to want that funding. You know,
MTA moves forty percent of riders across North America but
(15:46):
receives only a fraction of federal dollars from Washington. And
so we continue to rely on the federal dollars that
we get and it's important for us.
Speaker 1 (15:54):
But what's the backup plan if that evaporates.
Speaker 3 (15:57):
Yeah, we're confident, right that the MTA and the federal government,
the federal judge that is designed, right, we we're confident
that we would win that lawsuit. You know, Judge Lineman
issued a positive finding for the MTA just a few
months ago. And congestion pricing is, you know, continuing to
operate and we're generating the funding.
Speaker 4 (16:18):
I imagine.
Speaker 5 (16:19):
You know, you get a lot of people who hear
these numbers. Congestion pricing is on tractoris five hundred million.
They say, wow, that sounds like a lot of money.
Why are you know, why are the subways still the
way that they are? Delays, crime on cleanliness? Help us
just understand. I know that you said that a lot
(16:41):
of those fares go towards paying workers, But a number
like this, a number like five hundred million, what does
it mean in the context for the broader MTA organization
is that a lot of money.
Speaker 4 (16:52):
So I'll give you context.
Speaker 3 (16:54):
Our operating budget every every year is about twenty billion dollars, right,
That is to on subways, buses, commuter rails and the
services for six million commuters every day. But in order
for us to keep that system running, you have to
maintain it, right, and so sixty eight point four billion
dollars a good majority of that funding is to keep
(17:16):
it in a state of good repair. That means new railcars,
new buses, new signal upgrades, track maintenance, and everything else
that goes with operating a system that's so vast in size.
So five hundred million dollars is just one stream of
revenue that generates when we leverage it fifteen billion dollars
(17:36):
to continue with the capital side of the world, but
the operating side has different funding sources. But we're confident
that we, you know, move six million customers every single day,
and we're happy to do that safely.
Speaker 2 (17:50):
Jpittel, CFO of the Metropolitan Transit Authority, joining us here
in the Bloomberg BusinessWeek studio
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:07):
The MTA runs New York City subways, buses, and commuter
trains that six million people rely on each weekday, and
on Monday, board members approved close to a two billion
dollar contract to expand the Second Avenue subway line into
East Harlem. Jpitzel is the CFO of the MTA. She's
charged with quite the task, which I think is fair
to say many would find unenviable, charting a sustainable path
(00:31):
through one of the agency's most financially trying periods in
its six decade history. She joins us here in the
Bloomberg Business Week studio. Jay, Welcome, how are you.
Speaker 3 (00:40):
I'm good, how are you? Tim?
Speaker 4 (00:41):
Thank you for having me.
Speaker 2 (00:42):
Yeah, thanks so much for joining us. I want to
start with the numbers and just ridership here. Weekday subway
ridership is still twenty five percent below pre COVID levels
in your modeling, does that ever come back to where
it was?
Speaker 3 (00:55):
I you know, we have a financial plan that's a
five year period, and originally we were projecting that we
would see our subway ridership up to ninety percent, but
a couple of years ago we revised that because we
weren't seeing that, but we're hopeful we see an eighty
percent by twenty twenty nine ridership.
Speaker 4 (01:13):
Recovery for subways.
Speaker 3 (01:15):
But on the railroads, we're seeing that recovery even higher.
Today we see eighty five percent ridership recovery on our railroads,
which is amazing, something that we thought was going to
be slower our railroad customers than our subway customers originally
coming out of pre pandemic.
Speaker 2 (01:31):
So is there a way to tap into that growth financially,
perhaps with higher prices for those commuters rather than here
in the city for subway and bus riders.
Speaker 3 (01:43):
So you know, what we have is very small, predictable
far increases that help balance the financial plan, and so
we don't want to burden one rider or over another.
It's really about distance space and commuters, and so we
keep that equitable.
Speaker 4 (01:59):
You know that we do two.
Speaker 3 (02:00):
Percent fare increase every other you know, every other year,
and that keeps our financial plan and balance.
Speaker 5 (02:07):
How do you plan to get that number, I think
you said eighty percent ridership? How do you bring people
back into the subways?
Speaker 3 (02:15):
We bring writers back by providing reliable on time performance. Right,
our service matters to customers and delivering the service that
we promise and schedule is something.
Speaker 4 (02:26):
That we strive for. But also safety.
Speaker 3 (02:29):
Our customers need to feel safe safe, and our customers
feel that right. We've had the lowest safety you know
numbers or crime numbers in July, and so our customers
are telling us.
Speaker 4 (02:41):
That by taking the subway, but also.
Speaker 3 (02:44):
Our customer surveys right tell us that customers are satisfied
with the service that we're providing.
Speaker 2 (02:50):
The MTA phases it combined one point one billion dollar
deficit over three years starting in twenty twenty seven. It
already owes close to fifty billion dollars. It needs to
spend sixty eight billion dollars more for vital improvements. There's
some federal aid that's up in the air. The Trump
administration is trying to roll back congestion pricing. What's the
backup plan if the aid EVE operates and the President
(03:13):
is successful in rolling back congestion pricing.
Speaker 3 (03:16):
You know, Tim, I would be remiss if I didn't
mention that. Back in twenty twenty three, we were the
first transit agency to solve our fiscal cliff thanks to
Governor Holcal, chairliber and the legislature, we were able to
come out of a deficit unlike any other transit agency today.
You've heard SEPTA's facing deep cuts Chicago, but we were
(03:36):
the first to say we need state, federal and local aid,
and we got our state federal funding for us. We
also as the MTA contributing to our solving our deficit. Right,
the MTA contributes five hundred million to operating efficiencies, and
those deficits that we have in twenty seven and twenty
eight and twenty nine are very small compared to our
(03:58):
operating budget, and we are committed to doing our part
in saving money to help ensure that we can balance
our budget in the out years.
Speaker 5 (04:07):
We were talking a little bit about the base fares
of subways increasing regularly. I'm wondering if there is there
a set area within the MTA that that revenue goes toward.
Because the base fare for a subway in New York
City it's expected to increase to three dollars in January.
Speaker 3 (04:25):
Correct, So our fares help our operating budget, right, So
they seventy percent of MTA's cost our labor and fringe,
and so that pays for seventy thousand employees and then
the small fraction is for the non labor contract, so
every fair contributes to operating cost.
Speaker 2 (04:45):
On our side, let's talk about fares and fair evasion.
Usually when we talk fair evasion, I think of people
jumping over subway turnstyles, and I know there have been
some mitigation efforts in place. But I took the bus
to LaGuardia on Thursday. It was a great experience. But
when I got on the sp Bs and Queens, I
got on it was like an articulated bus, so you know,
it was a long one. I got off and on
(05:06):
in the back and out of like more than half
a dozen people, I think I was the only one
who paid, And I was thinking to myself, I didn't
know it was optional to pay to get on the bus.
Speaker 1 (05:15):
What are the numbers there?
Speaker 3 (05:17):
So it's not optional right to pay the fair. We
are encouraging every customer to pay our pay their fair share.
Speaker 2 (05:23):
To but there's no enforcement on the bus.
Speaker 3 (05:25):
So there's a couple of things that we're doing for
fair evasion. And our chair has been tackling this first
when he became chair. So on the subways you've heard
of us talking about we're doing fins, sleeves, gate guards
enforcing the exit gate, which is the fair you know,
evasion highway. And so we've made great strides on the subways.
(05:46):
We've reduced fair evasion in over a year by thirty percent.
We've dropped that rate from a high of fourteen percent
to nine point eight percent, So we know those efforts
are working. On the buses, it's a little bit more difficult,
but we're also working there.
Speaker 4 (06:02):
We've decreased fair.
Speaker 3 (06:03):
Invasion on our buses as well in the last year
from fifty percent to forty four percent because all the
tactics the President of New York City Transit is employing.
Speaker 4 (06:13):
We have eagle teams that are looking, you know.
Speaker 3 (06:15):
On different bus routes to make sure that they are
enforcing the pay your fare right.
Speaker 4 (06:21):
Our bus operators.
Speaker 3 (06:22):
Do their due diligence, but really our eagle teams are
enforcement out there riding different routes and making sure customers
fair pay their fare or they're getting a summons or
they're getting off the bus. And that's how we're working.
Speaker 4 (06:35):
How does that work?
Speaker 5 (06:36):
Because I heard of a friend who was on a
bus and someone had come around and like scanned their
phone to see if they had paid the fare. Is
that how it works explained to us.
Speaker 3 (06:46):
So right now what we are doing is if you're
boarding the bus, you have to pay, because there's two
different ways you can pay right today is the Metro
card and the OMNI, and when we go to full
OMNI next year, there's going to be proof of payment.
And so what you can do is European style proof
of payment for customers is you can tap their phones
or credit cards the method of payment to see if
(07:07):
they pay their fare and if they didn't pay their fare.
That's something that we will work with on a summons
or you know, you need to pay your fare for
our customer, and so that's something that's coming. We're really
excited about that for OMNI and proof of payment, but
right now there's two different methods and so we're working
on different ways to combat fair evasion.
Speaker 2 (07:27):
I want to talk a little bit about proposals from
mayoral candidates or in Mumdani. For example, it's proposal to
make all New York City buses free. What do you
think of that and does it create a sort of
a two tiered mass transit system where people who ride
buses don't pay for it, but then people who ride
the subway do and then kind of offset like people
not necessarily taking the right mode of transit for their destination.
Speaker 3 (07:50):
So we've heard the maurial candidates proposal for a fair
free buses. What I'd like to emphasize again is fairbox
revenue is important to the operations of the MTA. It's
twenty six percent of our revenue, and buses is about
a billion dollars in the out years of revenue for
the MTA bus for the MTA, excuse me, and that's
(08:12):
important to us, and so we want to make sure
revenues equal service. And that is something that's hypothetical right now,
but we rely on fairbox revenue.
Speaker 2 (08:24):
So you said a billion dollars in revenue is what
it brings in. Mom Donnie estimates that's about seven hundred
and fifty million dollars annually to make buses free. Is
that an accurate assessment on his part.
Speaker 3 (08:34):
I think there's pieces that he's he's looking at just
the New York City Transit bus fair We have MTA
bus that we also run that the city contributes to,
and that is also fairbox revenue for buses.
Speaker 2 (08:45):
So what would take away that revenue from the MTA
due to the authorities finances or would it just be
I mean, look again, it's a proposal, you said, it's
something that you know is not a plan yet. But
to be fair, he is by far the favored candidate,
and there are a lot of questions about what power
he has to actually follow through with a campaign promise
such as this. But this is certainly a central part
(09:07):
of his campaign, so you got to be looking at
it closely.
Speaker 3 (09:09):
We are looking at it. But one thing that I
would like to emphasize right right now in New York City,
fares are affordable. We make transit and buses the most
affordable at two dollars and ninety cents, and it's affordable
with fairfares, reduce fair for our customers. But you know,
it is something that we will look into as the
mayoral candidate has proposed.
Speaker 5 (09:32):
What about mitigating climate issues that affect particularly the subway stations.
You go online, you see videos of flooding in station,
trying to.
Speaker 1 (09:41):
Get home and on a rainy day.
Speaker 5 (09:43):
Right and water in the subway station. Do you guys have,
at least as part of the upcoming capital plan, a
plan in place to update the infrastructure.
Speaker 3 (09:53):
A couple of points on that right, A couple of
the issues that arise in the subway systems are not
the MTA's fault. New York City right contributes to the
flooding issues that we face in the subways, whether it's
through dep manholes, the sewage. So that is one aspect
of the flooding that you see on the New York
City Transit. But our historic capital plan that sixty eight
(10:16):
point four billion dollars does have climate resiliency of hardening
the system in certain stations in proposed And therefore.
Speaker 2 (10:25):
Let's talk a little bit about congestion pricing. Not as
hot of a topic as it was a few months ago,
it seems like it's died down a little bit in
your view.
Speaker 1 (10:37):
Is it working?
Speaker 3 (10:38):
Congestion pricing is working. It is reducing traffic by eleven percent.
Speaker 4 (10:42):
What does that mean?
Speaker 3 (10:43):
Seventy thousand cars are off the road every single day.
Speaker 4 (10:47):
What else is it doing.
Speaker 3 (10:48):
It's moving our buses faster, it's moving people faster. We've
seen a change in ridership, but also we've seen safety increases.
Speaker 4 (10:56):
There's a fourteen.
Speaker 3 (10:57):
Percent decline in pedestrian crashes. And on top of it all,
it is bringing in the revenue that we had projected originally.
Speaker 2 (11:05):
It's being watched very closely, not just by proponents and
opponents of it, but also by other cities that might
want to put this into practice. Have you or has
the MTA heard from other cities about congestion pricing, about
the model and about questions about implementing it in their
own cities.
Speaker 3 (11:21):
The MTA has heard from other cities and transit properties
and engaged with them to have conversations about the process
that New York implemented for the successful congestion pricing program
that we're having, So they're looking at it at us
as a model.
Speaker 5 (11:36):
We have to ask about the second Second Avenue subway
expansion as well. Just walk us through some of the
plans and the timeline here, because this has been something
that's been in the work, something that any New Yorker
who's lived in New York for.
Speaker 1 (11:51):
The last ford how many years, forty decades.
Speaker 3 (11:53):
Fifty yards fifty I think we've talked about that at
our special board meeting on Monday.
Speaker 4 (11:59):
You know, the contract that our board just approved.
Speaker 3 (12:02):
Is almost one point nine billion dollar contract to start boring, right,
what does that mean? It's starting the tunneling for the
three stations that are vital to Second Avenue Subway Phase two.
And we are committed to expanding Second Avenue Phase two
here at the MTA, and we think it's going to
be a great service to our customers. It's going to
(12:29):
serve about one hundred thousand customers in addition to the
two hundred thousand customers that's Second Avenue Subway Phase one
serves today.
Speaker 5 (12:38):
Do you have a timeline or an expected timeline.
Speaker 3 (12:41):
I think the twenty thirty two was the service date
that we have said publicly.
Speaker 2 (12:48):
It's a very like I said at the beginning, it's
an enviable task that you have ahead of you. Some
people would argue, I would imagine that you spend quite
a bit of time studying other transit systems around the
world's worked and what hasn't worked. If you could waive
a magic wand here in New York City to overcome
some of the barriers that the MTA has experienced, whether
(13:09):
they're financial barriers, whether they're CAPEX barriers, what.
Speaker 1 (13:13):
Would those be like?
Speaker 2 (13:14):
What is the biggest obstacle to making the service even
better here?
Speaker 3 (13:18):
So I think tim one thing that I would say
is MTA is a leader and being the largest agency
in North America, other agencies look to us. I think
I said this before we led with the fiscal cliff,
we lead with our capital program as well. We have
started to do things differently since Janel Lieber took over
for CND and now Jamie Torres Springer. We do design, build,
(13:41):
we do faster, cheaper and better. But we're employing definitely
different ways of doing capital programs as well as operating
for us to be better.
Speaker 2 (13:55):
I want to go back to congestion pricing and some
financial questions around at specifically about selling debt off of revenues?
Do you have plans to sell debt off of revenues
from congestion pricing?
Speaker 3 (14:08):
So, as you know, the congestion revenue is dedicated to
the twenty to twenty four capital program. It is expected
to generate fifteen billion for that program, and once we
see a stable market in the revenues coming in.
Speaker 4 (14:21):
We do plan to issue debt. We've talked about it.
Speaker 3 (14:24):
That's not sometime until twenty twenty six for US. Once
we see a comfortable stream of revenue. We've projected five
hundred million for the next three years and we want
to make sure that we see that revenue and the
markets are comfortable issuing that debt for us.
Speaker 2 (14:38):
You've talked about fare increases on MTA services, what about
increases in congestion pricing?
Speaker 1 (14:45):
And what is the timeline for that?
Speaker 3 (14:46):
So, as the governor has said to us, right, it's
the toll will continue to be nine dollars for three years,
then it'll increase gradually to the next three years at
twelve dollars, and then in the final the seventh year,
it'll be a fifteen dollars. SI is a toll, So
we've already had that phased in based on the schedule
(15:06):
we approved.
Speaker 2 (15:07):
Can you just bring us I know there's litigation around
this with the federal government and with the state, but
can you just take us into conversations that you've had
with counterparts at the Department of Transportation over the last
few months about making sure that the MTA stays on
a sustainable financial path.
Speaker 3 (15:25):
So I think you know what I would say is
the federal government contributes two billion dollars to the MTA,
and that's a revenue source that we rely on to
keep the system in a state of good repair, and
so we would continue to want that funding. You know,
MTA moves forty percent of riders across North America but
(15:46):
receives only a fraction of federal dollars from Washington. And
so we continue to rely on the federal dollars that
we get and it's important for us.
Speaker 1 (15:54):
But what's the backup plan if that evaporates.
Speaker 3 (15:57):
Yeah, we're confident, right that the MTA and the federal government,
the federal judge that is designed, right, we we're confident
that we would win that lawsuit. You know, Judge Lineman
issued a positive finding for the MTA just a few
months ago. And congestion pricing is, you know, continuing to
operate and we're generating the funding.
Speaker 4 (16:18):
I imagine.
Speaker 5 (16:19):
You know, you get a lot of people who hear
these numbers. Congestion pricing is on tractoris five hundred million.
They say, wow, that sounds like a lot of money.
Why are you know, why are the subways still the
way that they are? Delays, crime on cleanliness? Help us
just understand. I know that you said that a lot
(16:41):
of those fares go towards paying workers, But a number
like this, a number like five hundred million, what does
it mean in the context for the broader MTA organization
is that a lot of money.
Speaker 4 (16:52):
So I'll give you context.
Speaker 3 (16:54):
Our operating budget every every year is about twenty billion dollars, right,
That is to on subways, buses, commuter rails and the
services for six million commuters every day. But in order
for us to keep that system running, you have to
maintain it, right, and so sixty eight point four billion
dollars a good majority of that funding is to keep
(17:16):
it in a state of good repair. That means new railcars,
new buses, new signal upgrades, track maintenance, and everything else
that goes with operating a system that's so vast in size.
So five hundred million dollars is just one stream of
revenue that generates when we leverage it fifteen billion dollars
(17:36):
to continue with the capital side of the world, but
the operating side has different funding sources. But we're confident
that we, you know, move six million customers every single day,
and we're happy to do that safely.
Speaker 2 (17:50):
Jpittel, CFO of the Metropolitan Transit Authority, joining us here
in the Bloomberg BusinessWeek studio
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