'WE HAVE TO PRIORITIZE' TO MAKE 'SURE THAT THE SYSTEM DOES NOT NOT FALL APART,’ MTA PREZ SAYS.

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$3.4 billion in lost federal funds to extend the Second Avenue subway into Harlem could be just the beginning of the fallout from Gov. Kathy Hochul's last-minute decision to "indefinitely pause" New York's congestion pricing plan—a decision she claimed to make on behalf of working class New Yorkers.

Her Tik Tok-ready video decree immediately blew a $15 billion hole in the Metropolitan Transit Authority's budget.

"We're going to do our best to prevent it being put at risk,"  New York's subway czar, Janno Lieber, the MTA's top official, said during a news conference late Monday afternoon. "Though that is a challenge."

Also on the chopping block are new signal systems to increase speed on existing subway lines, the Interborough Express light rail line to connect transit deserts in Brooklyn and Queens,  electric buses and scores of new disability-access stations.

"We have to prioritize," Lieber, the MTA's president and chair of its Board, explained. The MTA can only afford to do work that "assures the safety of our transit system. This is the basic stuff that makes sure that the system does not fall apart."

Lieber directly contracted Gov. Hochul, who earlier on Monday told reporters "funding will be there." 

Instead, Lieber said the MTA was taking "very serious steps to carve up the capital program and make sure we don't let the system fall into disrepair back into the 70s and 80s." The MTA has to "reprioritize, re-sequence and shrink the current MTA capital program."

The capital program is the MTA's construction budget, which is separate from its operating budget.

Congestion pricing was supposed to go into effect June 30. Gov. Hochul pulled the plug on the program last Wednesday. It was projected to generate $1 billion in revenue every year. The MTA planned to take the guaranteed cash and turn into $15 billion in bonds to fund modernization of the 120-year-old transit system.

Not only does the MTA lose money because of Gov. Hochul's decision, it could cost it more money because of increased operating costs.

If congestion pricing remains "paused," the MTA is going to have to borrow money to make up for the lost revenue. That adds to the MTA's operating budget because that's the part of the MTA's budget debts are paid from, Lieber said.

Relatedly, two credit rating services issued a "negative" credit warning which could increase the MTA's borrowing costs, possibly by as much as $300 million a year, Lieber disclosed.

Disabled public transit riders are also going to suffer because the MTA would not be able to afford to make its subway stations accessible. 

The retrofit was ordered as part of a legal settlement of a civil rights lawsuit by disabled New Yorkers. The agreements include a safety valve allowing the MTA to back out of the deal in what Lieber called "downside scenarios." 

When it comes to congestion pricing, Lieber said federal Department of Transportation rules say the MTA can not legally start the program without "a New York State DOT sign-off."

But, Lieber revealed, Gov. Hochul has instructed the Commissioner of New York's Department of Transportation to not sign-off.

"The governor's been very upfront about the fact that ain't coming at this time from the State of New York. They're not going to sign off on it. And therefore we're stuck," he said.

Still, he added, the MTA would "make sure that we're ready, if, and when, we get the green light."

Bottom line, Lieber said, the MTA was facing a "huge challenge" to keep the trains running on time.

"We're going to fight like hell to make sure we don't have to reduce service," Lieber said. "We got a tall order and we're behind the 8-ball right now." 

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