De Blasio, Cuomo and MTA battle over financing (again)

“Under the 2015-2019 capital plan, New York City Transit receives 51 percent, and when you throw MTA buses in it, it’s 62 percent,” said Metropolitan Transit Authority Chairman Joe Lhota during a Tuesday conference call. Lhota was responding to accusations by New York City Mayor Bill de Blasio that the money made by the New York City Transit goes to projects that don’t help New York City.

City commuters contribute approximately 70 percent of the MTA’s revenue.

Tuesday marked yet another day in the battle over the MTA and, in particular, the subway. The Mayor’s Office and Lhota and MTA President Pat Foye held two separate conference calls addressing New York State Gov. Andrew Cuomo’s plans to fund and fix the subways.

Cuomo’s plan, included in his latest fiscal budget proposal, would allow the MTA, without city approval, to collect revenue from the rising value of real estate in the city. Referred to as a “Value Capture Plan,” the MTA would establish transportation improvement districts around the city from which the MTA can usurp money.

“Value capture has been effective around the country,” said Foye during the MTA conference call. “It’s an effective and progressive way to fund the MTA.”

During the other conference call, New York City First Deputy Mayor Dean Fuleihan and city lawyer Zach Carter said that the money generated by the city needs to be used for other city-related projects. Fuleihan said the city has “many urgent needs” and that the city needs to collect all of the real estate taxes to fund its $86 billion annual budget.

“We certainly object to the arbitrary nature of the value capture proposal, which targets in a way that’s unprecedented for local governments that targets specific projects in New York City and takes most of what they claim would be of value determined without any local input by the MTA,” said Fuleihan. “The city has significant obligations that we need to keep, that we need to make sure we are able to commit to—safest big city in America, universal pre-K for 4 years old, expansion of pre-K, we can go on—addressing the opioid crisis.”

After hearing of the city’s conference call, Lhota said that he needed to provide a retort to the mayor’s team.

“When the mayor’s people were having their telephone call, I was meeting with Speaker Corey Johnson regarding the subway action plan,” said Lhota. “As I was leaving City Hall, I was briefed on it and felt like we needed to respond.”

But one nonpartisan organization has the mayor’s back. Carol Kellerman, president of the Citizens Budget Commission, said that putting the onus on the city to fund capital improvement to the subway is unjustified.

“The Executive Budget asserts the responsibility for funding New York City subway and bus capital improvements should rest solely with the City of New York, which would require a sevenfold increase in city capital contributions,” Kellerman said in a statement after the budget was revealed. “In addition, the Metropolitan Transportation Authority would be authorized to establish Transportation Improvement Districts within New York City that capture revenues from rising property values—without the city’s approval.