The end of Albany’s legislative season on June 10 only heightened the state-controlled Metropolitan Transportation Authority’s state of suspended animation. Gov. Andrew Cuomo waited until the final three days of the session to present a proposal changing both the structure of the MTA’s leadership, and the people atop it. Lawmakers were reluctant to make these big changes in an artificially induced hurry. Despite a last-minute near-compromise, they left town without acting.
The episode is a reminder of Cuomo’s weakened state – and of the unresolved questions about the MTA’s future. The authority has yet to provide clues on two issues that will help determine the course of New York’s recovery: how to grapple, fiscally and operationally, with ridership that may remain depressed for years, and if, how and when to bring congestion pricing to a wounded New York City.
On June 7, Assembly Member Amy Paulin of Westchester, and state Sen. Diane Savino of Staten Island submitted a short Cuomo-backed bill that would split the MTA’s top post in two. This includes a chair atop the board, but with no full-time management duties, and a chief executive to run the place on a day-to-day basis. A measure of how rushed the bill was were its blatant errors: The first version repeatedly referred to the MTA as the “Metropolitan Transit Authority.”
Current MTA Chair and CEO Pat Foye would leave to be succeeded by Interim NYC Transit head Sarah Feinberg, as chair, and MTA Construction & Development head Janno Lieber, as CEO. In a functional corporate or government world, a company or public authority can operate smoothly whether its chair and CEO are the same person, or whether the role is split. The argument for combining the role is to avoid any inconsistency between policymaking (done by the board) and execution (done by the CEO). The argument for splitting them up is to avoid having the CEO have too much control over the board, which sets the CEO’s pay. The bigger issue is whether the people in individual roles – chair, board members and CEO – can freely act with some measure of independence.
But the MTA isn’t a normal corporation, and the way its leaders interact with the governor is not exactly functional. For example, the chair is supposed to serve a fixed term, so that they can make decisions about fares or labor agreements without fear of being fired by the governor. Yet two separate news reports claim that Foye, who led the authority through the pandemic, isn’t thrilled about leaving, and his term doesn’t end until 2023.
If even partial MTA independence from the governor is a fiction, the Legislature should confirm it before naming another chair who serves (in practice if not in law) at the pleasure of the governor, just like any other state agency head. If so, and if the board is superfluous, it’s past time to rethink the whole public-authority structure.
Cuomo’s proposal would have injected even more potential for dysfunction. Though the chair would still need state Senate approval before serving, the CEO would not. The CEO would be (both in practice and in law) someone the governor could hire and fire at will.
This peculiar structure could lead to conflict. The chair and the board could set policy, only to see it undermined by a call from the governor to the CEO to execute the opposite of the determined policy. The chair could easily become a figurehead, thwarted in practice by on-the-ground decisions within the MTA itself.
It may be paranoid to suspect that this toxic tension was exactly what Cuomo meant to happen – except for there was no other reason for this split. Feinberg reportedly is not interested in a full-time CEO position, yet she has shown an intricate grasp of the MTA’s fiscal, managerial, and public safety challenges, and could serve as a probing chair member. But there is no reason, under the current leadership structure, that she couldn’t serve as chair and simply delegate a full-time deputy CEO to carry out her policies – unless Cuomo’s idea is for her to say one thing, and for the MTA CEO to do another.
It’s tempting to say: “Who cares?” We all know that Cuomo exerts undue influence over the MTA, right down to personally executing its labor agreements. He has already created a muddle of the MTA’s management structure over the past three years during which the organization brought in outsiders in new titles – Anthony McCord as “chief transformation officer,” and COO Mario Peloquin – only to see them flail (Peloquin left early this year). What difference does it make if it all gets even more muddled?
Yet the Legislature shouldn’t pass some watered-down version of Cuomo’s bill without noting: The MTA faces critical decisions in the next year or so, the direction and execution of which will help or hurt New York’s recovery.
First, how does the MTA approach service and staffing if ridership remains double-digit percentages below pre-pandemic levels? As of early June, subway ridership has reached about 40% of 2019 normal; commuter-rail ridership is about one-third of normal. Ridership should increase in the fall, as commuters return to Midtown and downtown offices and tourism begins to rebound. Yet few forecasters predict a five-day-a-week return to the office; the MTA itself projects that ridership will eventually recover only to 86% of normal.
This gap may be too optimistic, but it leaves massive deficits – covered only until late next year by federal relief money. For 2023 and 2024, the MTA faces deficits of at least $4.4 billion, or 11% of its budget.
Does the authority respond by slashing service – thus driving more riders away? Lack of express service on commuter rails is already a deterrent to resuming commutes that are now more than twice as long in some cases. Or does it start a gradual but firm process of asking its labor unions – particularly at the overtime-heavy Long Island Rail Road – for productivity savings? The Citizens Budget Commission's Alex Armlovich outlined a program for such savings in a recent paper.
There are more mundane questions, as well: Does a part-time, unpaid chair face restrictions on outside income?
The MTA also needs a plan for implementation of congestion pricing. More than two years ago, the Legislature authorized the authority to charge car and truck drivers a fee to drive below 60th Street in Manhattan. They left virtually all of the details, from whether and when the MTA ever executes congestion pricing at all, to the toll to be charged, and any exemptions or discounts to that toll entirely up to the MTA.
It’s clear from trying to traverse Midtown’s streets that New York City needs congestion pricing sooner rather than later; as car and truck traffic has largely recovered.
But the details matter. For example, will congestion pricing favor nighttime deliveries by charging a low price at night and a high one during the day? And if so, will city enforcers coordinate in ensuring that truck drivers make their deliveries inside loading docks, and not on the street to avoid disturbing Manhattan residents and hotel guests?
Will the MTA’s congestion pricing program allow the city the flexibility to ask the MTA to charge a “surge” price during a pollution alert day, or just after a snowstorm, or during the two weeks just before Christmas? A six-member advisory board will eventually advise the MTA on these matters – but the final decision is entirely up to the MTA’s board.
State lawmakers may return as early as this summer to reconsider a version of Cuomo’s bill. They should hold full hearings before they do so, not on the people involved (Feinberg and Lieber are more than capable), but on the political conditions under which they would operate.