New York MTA's Foye: $12B Needed To Save Transit Services

New York City's Metropolitan Transportation Authority needs $12 billion in federal funding to save cuts to its subway and commuter rail service after ridership took a drastic decline during the coronavirus pandemic, and unless it gets the money, the decline will also affect the national economy, MTA Chairman and CEO Patrick Foye said Wednesday.

"The remarkable thing is the decline in ridership," said Foye on CNBC's "Squawk Box." "It is in order of magnitude worse than what happened during the Great Depression."

The low point in subway ridership during the depression was a 13% decline, but during the worst days of the pandemic this year, ridership was down by 95%, said Foye. In addition, this past Monday alone, subway ridership was only at 29% of the normal number of riders before the pandemic, he said.

"What's really at stake is the economic revival of the New York City region, and to a large extent, the national economy," said Foye. "If we don't get federal funding, and our ask is $12 billion over the next several years, we may be forced to make service reductions on subways and buses of up to 40% and on the Long Island Railroad and Metro-North, 50%."

Foye said there will not likely be any COVID-19 relief bill money this year for mass transit agencies.

"The effects on the New York economy from a transportation point of view, environmental point of view, job point of view, social equity point of view, will be devastating if we don't get that $12 billion of funding.

The agency has come under fire from many quarters that it has been mismanaged, noted CNBC, adding that there will be lawmakers reluctant to give the MTA the funding.

"I think that's a legacy of the past," said Foye. "I will tell you that over the last several years we've taken $2.8 billion of expense out of the MTA. In 2021 we will take an additional billion dollars out of the MTA's costs from a construction point of view.

Meanwhile, Anthony Simon, general chairman of the International Association of Sheet Metal, Air, Rail, and Transportation Workers, is calling on the agency to dismantle its Transformation Team, which was put in place last year with a goal of cutting back $1.6 billion in internal costs, including consolidating departments, reports Newsday.

Most of the savings have already been made, Simon wrote, leaving "no need for millions of dollars to be spent on any other consultants, salaries, and expenses."