Cash-Strapped MTA Sells Bonds in Desperation; Bloomberg Sees Fare Hike and/or Service Cuts
Oh great: In light of the newly-discovered MTA $400 nillion budget shortfall because payroll tax revenues aren't up to expectations, Mayor Bloomberg suggested during a Q&A that "the MTA is either going to have to raise rates dramatically or cut back service dramatically or, what's more likely, some combination of the two."
And MTA just dumped about $650 million worth of bonds to pick up some badly-needed cash. The proposal of the sale caused a credit downgrade by Moody's.
The MTA revisited the budget in December and instituted new reductions in bus and subway service, which have yet to take effect. They're still holding hearings on doing away with student discount fares. It seems as if they've already cut a lot without reaching the bone, but they may be getting there.
Some transit watchers are suggesting that federal stimulus funds be redirected to the MTA budget. (They're thinking similarly in Chicago, too, where the transit budget is also a mess.)
The Authority's finances are sufficiently dire that Chairman Jay Walder has admitted the MTA isn't keeping the stations as clean as it used to. "During each financial downturn, the first thing to go is the cleaning and maintenance of the stations," he says.
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