Quiet Provision in State Budget Raises MTA Debt Ceiling, Allows Much More Borrowing
A little-noticed provision quietly tucked into one of the state budget bills raises the debt ceiling for the MTA, allowing significantly more borrowing for the mass-transit agency. State House Reporter Zack Fink explains.
After staying up all night, the New York State Senate finally voted on the last budget bills before 9 a.m. Friday.
One of those bills raised the debt ceiling for the Metropolitan Transportation Authority (MTA), allowing the agency to borrow up to $55 billion.
"What kind of message does that send, that we're allowing one state authority to issue more debt than the entire state of New York is allowed to?" said State Assembly Member Nicole Malliotakis of Staten Island and Brooklyn. "It's going to lead in the future to higher tolls, fares, and service cuts."
The State of New York is currently authorized to borrow up to $48 billion, but debt before April 1, 2000 is exempt.
So, the state's level of debt authorized is actually closer to $123 billion.
"Comparing an amount of debt authorized to an amount of debt outstanding is apples to oranges," Morris Peters, a Gov. Andrew Cuomo Administration official, said in a statement.
Observers said the new MTA debt ceiling explains how Cuomo will fund the agency's ambitious capital program construction, which includes East Side Manhattan access to the Long Island Rail Road and the Second Avenue Subway.
"Cuomo said he's going to give $8.3 billion to MTA; he only showed up with $1 billion," said Nicole Gelinas of the Manhattan Institute. "And so where is he going to get the rest of this money? Obviously there's your answer."
Critics say commuters will ultimately get hit with the bill.
"Somebody has to pay for this. The MTA already has budget gaps over the next several years, so people's fares and tolls will go up to pay for all this debt," Gelinas said. "It's just that the governor probably expects that this will happen after he leaves office."
The debt ceiling increase was attached to the same budget bill that raised the state's minimum wage.
"An important vote like that — to jam it in an omnibus piece of legislation that has to do with education funding, a minimum wage increase — is really irresponsible," Malliotakis said.
Cuomo was asked Wednesday about lawmaker complaints that they had no time to read the budget before voting:
"Then they should talk to their conference leader, because we had been negotiating for months," Cuomo said.
The final word on the MTA capital plan comes from yet another obscure Albany panel, the Capital Program Review Board. It is expected to meet within the next month and give final approval.