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A $48 billion debt is crushing the Metropolitan Transportation Authority. Paying it off could disrupt the future of New York City transit.
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- Published
- Jun 21 2023
- Word count
- 2195 words
Scary stuff. With ridership down, the agency is struggling to keep the lights on. They're not insolvent, but it's apparently "precarious." The current high interest rate environment certainly can't help anything.
The article also touches on some of the inefficiencies of the MTA. One of the reasons we're seeing budgetary issues is because the decision-makers at the agency "makes poor decisions with what it's going to spend that money on."
I imagine and hope that congestion pricing and other measures meant to reduce private vehicle use in New York City—beneficial for any number of social, environmental, financial, budgetary, and aesthetic reasons—helps shift ridership back toward the subways. But the MTA needs to think about the ways that its lack of standardization, strange project resource allocations, and overall strategy could be hurting its future.
As WFH continues to grow I think we'll see more and more of this. Which is frustrating because mass transit and public infrastructure is already pretty awful where I am in New Jersey. I'd kill for a good country wide rail infrastructure.
Wasn't there another post a day or two ago talking about how they wanted to spend $100M on some fancy platform barriers for a couple of stations? Seems like maybe they should hold off on stuff like that until they get their finances in order.
The article I shared on platform screen doors (PSDs) did quote some impressively high costs. Much of this is because New York's infrastructure is antiquated and the technology has almost never been deployed in the city. Though, to be honest, $100 million is a drop in the bucket for the MTA's $19.2 billion.
PSDs are actually a good capital investment, not just for safety reasons (they save lives) but just as importantly because they help reduce technical issues and improve service. The screens prevent debris from accumulating on tracks, which reduces the number of subway fires and otherwise helps improve operational efficiency. Additionally, the move toward greater automation via PSDs reduces personnel costs (or allows personnel to be allocated toward more pressing matters).
The MTA's biggest spending mishaps are mostly related to their disjoint infrastructure and equipment across different lines and stations, usually without a good reason. For example, while the subway track gauge is thankfully standardized, the A and B Divisions of rolling stock meaningfully increase equipment acquisition complexity and therefore cost. There are historical and logistical reasons we've ended up with different kinds of traincars on different lines, but it's one example of inefficiency.
More egregious spending is related to new station design. The MTA chooses to largely design new stations from scratch, often not even reusing simple internal structures like escalators and therefore requiring significantly more design work that dramatically increases cost. Unfamiliar designs also have unexplored caveats that cause delays. The use of a greater variety of components increases cost in the long run because supply chains are harder to maintain. Additionally, new stations are sometimes overbuilt for aesthetic reasons, especially new concourses. While it's nice to have a fantastic station overhaul, it's more efficient to build more, smaller stations according to actual demand requirements. The strange design of many stations also makes it difficult for them to be expanded when demand increases, requiring even more expensive overhauls. And so on.
I don't work for the MTA. I'm sure they have their reasons for all their spending. But they could take some inspiration from European transit agencies, who manage systems approximately the same size as the NYC subway for much less cost.
Yeah, the platform screen doors is certainly an infrastructure investment. And sure, it's important. But at what cost? It's easy to say that $100M is chump change for a $19.2 billion yearly budget. But when the organization is $48 billion in debt, ROI of investments is important. A problem here is that the more debt that you have, the more expensive it is to take on new debt. The bonds for an organization with the MTA's financial state (of a debt load that's more than 2x of their entire budget) will be pretty unfavorable for them.
This report on the state of their debt is pretty interesting. It looks like they have heavily-backloaded bonds where they're paying only interest and little to no principal. So financing $100M for their screen doors for 3 stations will cost them several hundred million in the end.
This sort of thing sucks for everyone, including other cities like mine who desperately need public transportation but can't find a sustainable way to fund it. Tax revenue only goes so far when it has to go to many different services, especially in a high-cost area like NYC.
I agree. It makes more sense to stop policing “fare jumpers” and use that money instead to pay down debts and/or on the quality of service to ridership stops going doing a bit.
Hmm, how many "fare jumpers" need to be discouraged from stealing in order to break even with the pay of a transit cop?
Obviously, collecting revenues through fares is an important part of their financial situation as well.
The "platform barriers" referred to aren't related to fare jumpers. They're called "platform screen doors": safety measures to separate the station from the tracks that also provide some logistical benefits.
Aaahhhhhh I am so used to MTA putting up barriers against the poor/fare jumpers that I didn’t even realize that these are to cover from the tracks when I read the article (I think I read it after my adderall wore off). That makes more sense for their existence, but I think there are still other issues they should fix before they do this for a whole three stations. :/