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The Metropolitan Transportation Authority (MTA) announced yesterday it is undertaking the largest cost-cutting program in the agency’s history to help solve billions of dollars in deficits the agency is facing as a result of the COVID-19 pandemic.
MTA is projecting a deficit of $16.4 billion by 2024, including $3.2 billion for 2020, $5.8 billion for 2021, $3.5 billion for 2022, and between $1.8 billion and $2 billion for the following two years, MTA officials said in a press release.
The agency initially identified $1 billion in savings in 2021 by reducing overtime, consultant contracts and non-labor expenses. Through 2024, MTA has identified $5.13 billion in-house savings through “aggressive budget reduction efforts,” officials said.
The agency will consider wage freezes, delaying the start of new capital projects, reducing the scope of the 2020-2024 Capital Program, non-personnel expense reductions, employee reductions, scheduled fare and toll increases, service reductions and long-term deficit financing.
The MTA is currently losing $200 million a week in revenue from fares, tolls, subsidies and COVID-related expenses. This year alone the MTA projects $4.2 billion in fare losses, $2.1 billion in reduced subsidies, $880 million in toll losses and $500 million in increased expenses.
MTA officials said the agency this month will exhaust all federal funding previously secured in the Coronavirus Aid, Relief, and Economic Security Act.
As the U.S. Senate considers the next relief package, MTA is requesting $3.9 billion to get through the year and $10.3 billion for 2021.