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|Tuesday, July 30, 2013, 10:30 a.m.||Gene Russianoff (917) 575-9434|
(New York, NY) The NYPIRG Straphangers Campaign today released an analysis of future fare increases for subways and buses, showing that fares could soar by 50% over the next decade.
The review was conducted by the New York City Independent Budget Office (IBO) at the request of the Campaign. The IBO is a publicly-funded City agency that provides non-partisan information about the Citys budget and economy to the public and their elected officials. (For more information on the IBO go to: www.ibo.nyc.gov.)
The IBO analysis assumes continuation of subway and bus fare increases of 8.4% every two years, which the MTA started in 2011 and repeated in 2013.1 The MTA has called these increases moderate. (See IBO Fiscal Brief.)
The current MTA four-year financial plan includes another 8.4% hike in 2015 and again in 2017. An 8.4% increase in transit fares in 2015 is projected to raise $409 million annually and an 8.4% fare increase in 2017 for ten months would raise $380 million.
In discussing its 2014 preliminary budget last week, MTA officials said that the actual amount of increase would be decided at the time of MTA fare increase hearings and would depend on the agencys overall finances.
Given the pattern of two implemented biennial increases of 8.4% adopted in the MTAs financial plan, the IBO and the Straphangers Campaign concluded five 8.4% increases over the coming decade was an appropriate gauge. (Current and projected fares can be found at Tables One and Two.)
In its Fiscal Brief, the IBO concluded that after 10 years of MTA subway and bus biennial increases of 8.4%:
Constant fare hikes will overburden riders, discourage use of mass transit, and cannot be sustained over time, said Gene Russianoff, staff attorney for the Straphangers Campaign. Without more financial support from Albany, the MTA might as well start making announcements that there is a fare hike right behind this one.
Russianoff said he was looking to Governor Cuomo and state legislative leaders to find new funding sources to avoid or soften the looming steep increases. He noted that the MTA had cut $700 million from its annual operations and was planning hundreds of millions more.
The New York City transit system already places a heavier burden on its riders than other transit systems in America, according to the IBO.
The agency noted that: The MTA relies more heavily on fare revenue from riders than many other transit system operators.
The IBO reviewed federal data to estimate that the overall farebox recovery ratiopassenger fare revenue divided by operating expenseswas 58 percent for New York City subway and buses, compared with ratios of 44 percent, 38 percent, and 36 percent for local transit in Chicago, Boston, and Philadelphia, respectively.
The IBO Fiscal Brief included discussion of the average fare paid per trip. According to the MTA, the average fare for 2013 which counts a free transfer as a trip is $1.76.
Russianoff said that the notion of an average fare may make accounting or bookkeeping sense for the MTA, but was meaningless to millions of riders.
He noted, for example, that each trip on a pay-per-ride MetroCard cost a passenger $2.38 for each subway trip no matter how many trips are taken.
Russianoff added: Try telling a long-time user of a 30-day MetroCard that an average fare has only risen from $1.38 in 1996 to $1.76 in 2013, when the cost of a 30-day MetroCard has gone from $63 to $112 in the same time period.
The IBO Fiscal Brief ended on a likely-to-be-prophetic note of uncertainty:
Given the financial pressures the MTA will face over the next decade, some fare increases are likely. The timing and amount of those increases, however, may be very different from those analyzed here.