In September 2004, the Board of the Metropolitan Transportation Authority (MTA) approved a $28 billion capital program for 2005-2009: $17.2 billion for the core program (state of good repair, normal replacement and system improvement items); $9.9 billion for network expansion projects; and $600 million for security and interagency programs. While there is broad agreement on the need for this expansive program, there has been little concrete discussion of how to pay for it.
This report examines potential financing sources that could be considered as part of a comprehensive financing strategy. The report is not an exhaustive list of all potential revenue sources. Rather, it focuses on new revenue options that may be particularly suitable as dedicated funding streams for long-term transportation projects. All of these sources have a strong nexus with the benefits that these projects would bring to the New York region, either by reducing congestion for auto users and improving road access for buses, taxis, and emergency vehicles, or by promoting job opportunities and economic growth.
Attaining buy-in for any of these options would be challenging, but the alternative is an outdated, deteriorating transportation system that is unable to support a growing economy. We have reached a point where neither continued borrowing nor marginal increases in existing revenue sources will be sufficient to maintain the current system and provide capacity for growth. Some combination of new dedicated revenues, along with increased support from general state and city revenues, will be needed to carry out this agenda.
