Legislature Passes on Deficit Fix, Putting MTA Raids In Cuomo’s Hands

In Albany this week, legislative leaders declined to take action to close the state’s current $315 million budget deficit. That pushes the problem into 2011, when a new governor and likely a Republican State Senate will be in power. Whether dedicated MTA funds will still be used as a piggy bank, at the expense of transit riders, will be up to next year’s leadership.

Governor Paterson had been urging the legislature to pass a deficit reduction package similar to the one that passed this fall, which sliced away $16.7 million from the MTA. Under the same formula, the MTA stood to lose more than $18 million in dedicated funds if the legislature had followed Paterson’s wishes.

The legislature’s inaction grants the MTA a short reprieve, but doesn’t remove the fundamental pressure that the state budget places on the MTA. The current deficit, which Comptroller Tom DiNapoli warns may actually be as high as $1 billion, must be closed by the end of the state’s fiscal year on March 31. How the new state leadership decides to tackle it will be an early indicator of their willingness to protect transit funding.

Will Cuomo propose a budget fix that includes further transit raids, or will he protect dedicated funds and look for extra savings elsewhere? Will Senate Republicans, who loathe the payroll mobility tax, continue to allow that billion dollar revenue stream to be exempt from state raids?

Cuomo has already suggested that he’s comfortable with shifting dedicated transit funds around through the budget. By the end of March, we’ll know whether he’s willing to let straphangers absorb another hit.