Update — January 2009
The Federal Economic Stimulus and New York City
While the economic forecast is grim across the country,
New York State and New York City have been hit particularly
hard. The financial sector contributes over 20 percent
of the tax revenues for the state and in the wake of
the current financial crisis, New York State is facing
a deficit of over $15 billion while New York City faces
a shortfall close to $4 billion. To address the deficit,
the Governor and Mayor have proposed billions of dollars
in cuts including dramatic cuts to healthcare, public
schools. Governor Paterson is proposing $3.6 billion
of cuts in healthcare, public schools will lose $2 billion
of aid, and $300 to $400 million would be cut from human
services, economic development, work force, and higher
education programs.
New York City would be hit hard by the proposed state
budget cuts, which would deprive the city of roughly
$1 billion. State funding for the Metropolitan Transportation
Authority would also be slashed by $285 million even
though the agency needs 23 percent more revenue. As
a result, the MTA will be forced to drastically cut
services while imposing a 25 percent fare hike to close
their budget gap.
Recognizing the severity of the situation, President-Elect
Obama has vowed to introduce an economic stimulus plan
within the first few weeks of his new administration.
The federal plan would look to increase capital spending
in order to create jobs and slow the economic downturn.
Increased spending on public infrastructure projects,
like rehabilitating subway stations or updating the
electrical grid, provide the most economic return per
dollar spent. The economic impact of capital spending
translates into roughly 8,700 jobs, $54 million in wages,
and $1.5 million in related economic activity for every
$1 billion spent.1
In New York City, there is an urgent need to capture
federal economic stimulus funds. Federal stimulus funds
can ensure that New Yorkers stay employed and help stabilize
the local economy.
1 www.gothamgazette.com/article/transportation/20081117/16/2760
SAVE THE DATE
The New Apollo Plan, the Economic Stimulus and New
York City
February 2, 2009 — 5:30-7:30 pm
New York City District Council of Carpenters
395 Hudson Street, 10th floor
(between Clarkson and Houston Street)
On February 2, 2009, the New York City Apollo Alliance
will host a forum addressing how federal level action,
such as the proposed economic stimulus and the New
Apollo Plan would affect New York City.
At the forum, leaders from the labor, environmental
justice, and business communities will address how the
federal economic stimulus could be used to expand New
York City’s green collar workforce and Jerome Ringo,
President of the national Apollo Alliance, will introduce
the New Apollo Program. The New Apollo Program is a
plan to invest $500 billion over the next ten years
to create over five million jobs and bring us closer
to energy independence. The forum will also address
the importance of federal economic stimulus funds for
the city and explore how they can be used to expand
New York City’s green collar workforce.
The discussion will be followed by a question and answer
period. Registration and check-in from 5:30-6 pm. The
program will begin promptly at 6pm.
Please RSVP at: www.urbanagenda.org/events.htm
Light refreshments will be served. Space is limited
so please RSVP early.
SPOTLIGHT
Transportation in Trouble: What does a threatened
transit system mean for New York City?
In light of the MTA’s financial crisis and $1.2 billion
budget deficit, the board is struggling to create a
viable budget for 2009. Their proposal (which passed
almost unanimously on December 17, 2008), includes the
elimination of $177 million worth of services, a 23%
fare hike, and a rise in fares for Access-a-ride. These
actions will place a substantial financial burden on
riders and further clog surviving lines. To soften the
blow, the governor-appointed MTA Financing Commission
(headed by Richard Ravitch) released a report on December
2nd with recommendations to produce revenue and improve
operating systems for 2009. The recommendations include
a Mobility Tax, a fare hike of 8%, and establishing
tolling on the East and Harlem River bridges, It also
recommended restructuring the governance practice of
the MTA to ensure more “transparency and accountability”
in its practices.
If New York City is going to move towards a greener
and more sustainable future, an affordable and reliable
transportation network for New Yorkers is vital. More
efficient transit means less car congestion on the streets
and highways, less traffic pollution, energy-efficiency
savings that could lessen dependence on foreign oil,
and better access to economic opportunities for workers.
It also means jobs, and many of them. The last five
year program instituted by the MTA saw the creation
of nearly 346,500 jobs over nine years. On the flip
side, the budget cuts proposed by the MTA Board will
mean the loss of 2,700 jobs. The health of the MTA’s
operating and capital budget directly impacts the lives
of workers.
Between the MTA, the City, the riders, the State government,
and the Federal government, the money for New York City’s
transportation system needs to come from somewhere.
In concern for borough residents, Comptroller William
Thompson has other suggestions to avoid the implementation
of bridge tolling. He proposes a weight-based surcharge
for vehicles that use the 12 counties serviced by the
MTA, and the reinstatement of the Commuter Tax. However,
the imposition of tolls and taxes are not within the
power of the MTA. Until word is received from Albany
or Washington, the MTA will prepare to adopt this budget
for 2009.
Read the Ravitch Report:
www.ny.gov/governor/press/pdf/press_1204082.pdf
NY Times article:
http://cityroom.blogs.nytimes.com/2008/12/17/
debate-on-mta-cuts-and-fare-increase/?scp=2&sq=mta&st=cse
