Transit Coalition: Proposed Fare Hike is Divisive
October 24, 2012
By Marc Bussanich
The new coalition,The Campaign to Move Transit Forward, formed in response to the MTA’s upcoming fare increases in 2013. MTA Chairman Joseph Lhota recently unveiled four different pricing plans that will raise the base fare from $2.25. But the coalition argues that before the MTA raises fees on commuters, it should renegotiate inflated interest rate swaps with the major banks, which would immediately net the agency about $100 million to be used for service restoration of cuts made in 2010.
A joint report, Money for Nothing, issued last year by United NY, Center for Working Families and Strong Economy for All, reveals that interest rate swaps have turned into a major stream of cash moving directly out of public budgets and into the pockets of the biggest banks. As a result of the financial crash and the subsequent bailout of the major banks by the federal government, interest rates have remained at historical lows. But as of 2011, New York State, New York City and other New York public entities are today paying over $236 million to the big banks on just a few of these swap deals, according to the report.
The report also shows that the “MTA’s net swap payments in 2010…could have spared the riding public from deep subway and bus service cuts, as well as 1,012 MTA workers at New York City Transit from layoffs.”
Mona Davids of the NYC Parents Union, which is a coalition member, along with UPROSE and La Fuente, said the coalition was formed because financially struggling New Yorkers need a “truly independent voice that is going to advocate and speak for the majority of New Yorkers who cannot afford a fare hike with poor service and lack of safety.”
“If working families bailed out the banks after they almost brought our country to the brink of destruction, they most certainly can renegotiate with the banks; that’s the very least the banks can do.”
She noted that the MTA’s proposed tiered fare is divisive because it’ll pit different communities against each other along income and demographic lines.
“The demographics of buyers of monthly MetroCards are usually higher-income professionals, not working families. The MTA has set the stage for a battle amongst communities. All of this doesn’t have to happen if the MTA would simply renegotiate its interest rate swaps,” said Davids.
The first proposal consists of two different plans that raise the current base fare to $2.50 and single ride ticket to $2.75. In addition, Plan A raises the 30-Day unlimited pass from $104 to $112, while Plan B raises it to $109. But though the cost of the monthly pass is increasing in both plans, the number of trips will decrease from the current 50 to 48 in Plan A and 44 in Plan B.
The second proposal maintains the base fee and single ride ticket at $2.25 and $2.50, respectively. As with the first proposal, however, the monthly-unlimited pass will increase to $125 in Plan A and $119 in Plan B. But riders will benefit from an increased number of trips, from the current 50 to 59 in Plan A and 53 in Plan B.
While more affluent city residents in Manhattan will argue for Plan A because they’ll be able to afford it, working families in Brooklyn and Queens will argue that they don’t need the monthly pass and don’t want the fare of the Express Service between Co-Op City, Bronx and Midtown, Manhattan to increase from the current $5.50 to $6.00, noted Davids.
Davids said the coalition favors the second proposal’s Plan B because it maintains the current base fare and the express bus fare.