WPCNR ALBANY ROUNDS. By Assemblyman George Latimer. March 22, 2009: The print and electronic media of New York City has been focused, non-stop, on the impending mass transit crisis ahead if the State Legislature (“Albany” in shorthand) does not approve the Ravitch Plan to bailout the MTA. That plan, has, as on its express track, a plan to place tolls on East River and Harlem River bridges that have long been free – the Brooklyn, Manhattan, Williamsburg, Queensboro Bridges, et. al.
Assembly Speaker Sheldon Silver offered a compromise plan, lowering the prospective tolls from $5 to $2 to satisfy the outer borough outrage, but as yet, some number of Senators and Assembly members are unconvinced. Their constituents abhor the toll plan. In return, the editorial boards and columnists assert that only a reckless public official would risk mass transit calamity by fighting the toll plan.
In all of this, there is been a wilfull disregard for the impacts of the other, “forgotten” track of the MTA bailout – the imposition of a payroll tax that would equally hit all employers throughout the MTA region, from Montauk in Suffolk County to Middletown in Orange County.
By calling this levy a “mobility” tax, the Ravitch Plan softens the sound but not the impact of the action. It assesses $0.33 on every $100. of payroll paid for every employer – including every school district, every local government, every hospital, every not-for-profit entity. The rate appears to create a low impact. But for the New Rochelle School District it is an unfunded mandate of nearly $400,000; for the Mamaroneck School District, it is a $200,000+ charge. And not merely for school districts: for all the employers mentioned, as well as every corporation and business large or small. At a time where some want to cap school taxes, others want to end County government, and all are outraged by the cost of rising property taxes, we are prepared to add yet one more burden that will increase our property taxes.
I spoke recently with the executive of a small business – under 20 employees – who said this is one more hit on his bottom line…and it may mean he will layoff an employee or two. His profit margins are minimal, and whatever the MTA may think, he can’t just absorb another uncontrolled cost. That’s exactly what we don’t need in this time when we are spending trillions to jump start the economy. Another business has spoken of picking up their operations and moving it a few miles east into Connecticut, beyond the reach of this and many other taxes. My Rockland and Orange colleagues face the same challenge in holding onto businesses who have the option of New Jersey on their doorstep. And further: while it doesn’t affect my district, who can honestly say that the meager MTA service into Rockland and Orange Counties warrant this levy in equal proportion to those based in Manhattan? How can, in good conscience, Putnam and Dutchess employers feel connected to the MTA for their employees’ and customers’ “mobility” and therefore, an equal partner to a Wall Street firm in paying this tax?
If it must be that there is to be a payroll tax, then it should be graded by sub-regions within the MTA world. Manhattan corporations – the largest beneficiary of the commuter rail system in bringing their employees to market – should pay a proportionately higher rate, than those from the suburbs. Local taxing entities – villages, towns, school
districts, small cities – should be exempted from the tax; if not, this payroll tax will quickly become one more element of higher property taxes when these governments prepare their budgets.
The legislators objecting to tolls have raised a very legitimate point, glossed over by their critics: who trusts the MTA’s numbers? Who believes they have done everything they can to reduce costs, scale back compensation, provide full transparency to their budgeting? Where is the independent audit that verifies their numbers? If we must act now, then sunset provisions for a year, subject to a full public audit. We can revisit the matter with the benefit of a full MTA audit before us.
There is no question that raising rates 30% and cutting back service is a draconian outcome for riders. But that is the threat offered by the MTA designed to make us subordinate any legitimate critique or concerns over their plan.
We are rolling down this forgotten track far too fast. We will live to regret these decisions made in the haste of the moment.
