Gov. Kathy Hochul seeks to plug an enormous finances hole on the MTA with a tax hike on companies, revenue from new casinos and a funding enhance from New York Metropolis, her workplace mentioned Wednesday.
MTA officers nonetheless plan to hike fares by 5.5% this yr to assist shut the hole.
The brand new revenue streams might be launched as a part of her govt finances — which state officers mentioned will deliver the transit company one other $1.3 billion yearly.
The MTA desperately wants the revenue as money streams from transit fares stay down roughly 40% from earlier than the pandemic. The company wants an additional $600 million to steadiness its books this yr. The MTA faces a deficit of $1.2 billion in 2024, which is predicted to develop to $1.6 billion in 2026.
The proposal by Hochul — which should be accepted by the Legislature — would enable the MTA to keep away from draconian service cuts and big layoffs. For greater than a yr, MTA Chairman Janno Lieber has known as for brand spanking new devoted revenue streams to steadiness the company’s books.
A type of proposed revenue streams is a rise to the state’s payroll mobility tax, which at the moment takes 0.34% of the payroll for many employers in New York Metropolis, Lengthy Island and elements of the Hudson Valley for the MTA. Hochul needs to increase the tax to 0.84%, which she estimates would generate $800 million a yr for the transit company.
The governor additionally needs to amend state regulation to use tax revenue from deliberate casinos for the MTA — and is asking Mayor Eric Adams to chip in one other $500 million yearly to steadiness the MTA’s books.
“Any new MTA revenue sources must be dedicated and lockboxed to ensure they are reliable and protected from the whims of the Governor and Legislature every budget cycle,” Rachael Fauss with the nice authorities group Reinvent Albany wrote in an e mail.