Despite a struggling economy and fewer federal dollars, many mass transit projects are still on track in New York. That's because the Metropolitan Transportation Authority's capital plan is fully funded in the state budget that takes effect next week. Zack Fink has the story.
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NEW YORK STATE -- About $770 million in direct state funding will be made available for the remaining three years of the MTA’s capital plan. But that's not the only money being allocated.
Lawmakers began voting on the budget Wednesday and one of the bills authorizes borrowing $7 billion more dollars to keep the capital plan solvent.
"That would bring the total debt for the MTA to over $40 billion, which is a serious concern for me as a representative of Staten Island and Brooklyn, the community that has the highest one way toll. The Verrazano Bridge," Assemblywoman Nicole Maliotakis said.
The capital plan includes East Side access for the Long Island Railroad in midtown, the Second Avenue subway and the Fulton Transit Center in lower Manhattan, among other projects. Funds will also go toward general maintenance and upkeep.
Many city lawmakers say raising the debt limit is a necessary evil.
"In this particular case, the needs outweigh the downside to that," Assmblyman Michael Dendekker said.
Last September, a rating agency downgraded some MTA debt, the first time that had been done in recent memory. When that happens, it can actually cost more to borrow, so debt service payments go up.
"As ridership improves and as the economy recovers and New York City has more jobs the MTA will have more revenue and be able to cover the additional debt service," said Assemblyman James Brennan.
But some transportation advocates say when debt service payments go up, that comes out of the operating budget which hurts service for riders.
In a statement, the advocacy group transportation alternatives said, “Once again, Albany is putting the cost of our transit system on a credit card and riders will foot the bill by paying higher fares. We already endure the highest fare burden in the nation."
MTA Chairman Joe Lhota says he is confident the agency's bond rating will not be affected by new borrowing and the funds will be used in part to purchase new subway cars.