Fiscal Pressures Heighten for MTA
The largest transit system in the U.S., the Metropolitan Transportation Authority (MTA) continues to face financial challenges following the dramatic drop in ridership and ridership revenue during the pandemic according the recent Economic and Policy Insights article released by the New York State Comptroller’s Office. Especially critical to the economic health of New York City and its residents, the MTA has the largest share of commuters who use public transit among comparable U.S. metro areas served by combined bus and heavy rail (subway) operations. In addition to fostering foot traffic and economic activity in and around travel hubs, neighborhood stations and bus stops, public transit also effectively improves the city’s affordability of living by reducing the need for a vehicle.
Ridership and farebox revenue at the MTA were particularly hard hit due to the severe impact of the pandemic on New York City, regional density of employment, the number of jobs that were lost and a higher reliance on mass transit in the New York metropolitan area. According to the latest year-to-date data from May 2022, the farebox ratio for New York City Transit (NYCT) was 31.9%, compared to the budgeted 40%; while in 2019, the NYCT’s and MTA agency-wide farebox operating ratio was 52.8% and 51.1% respectively. Once federal relief aid is exhausted, MTA will need to take creative measures to close the financial gap between pre-pandemic, budgeted and actual farebox operating ratios system-wide, such as a possible recalibration of service to meet shifting trends in demand amid continued office tenants’ remote and hybrid work policies — a challenge that will dictate the options the agency has to close its structural budget gap, while keeping in mind the potential impact of such changes on services and the regional economy.