NY Gov. Hochul signs bill to fully fund MTA capital plan

New York Gov. Kathy Hochul on May 9 signed legislation to fully fund the Metropolitan Transportation Authority's (MTA) $68.4 billion 2025-29 capital plan with a mix of local, state, federal and reappropriated MTA funding sources, as well as increased Payroll Mobility Tax (PMT) revenue.

PMT is revenue generated through regional taxes on employers in the Metropolitan Commuter Transportation District, calculated via the employers' payrolls. In the new financial plan, New York will increase the PMT rate by less than 1% for businesses in the region with payrolls of more than $10 million. At the same time, the state will lower PMT for small businesses, self-employed individuals making less than $150,000, and local governments outside of New York City, MTA officials said in a press release. 

With a fully funded budget, the MTA will be able to begin construction of the new Interborough Express light-rail line between Brooklyn and Queens; rehabilitate the 4-mile stretch on the Metro-North Railroad known as the Grand Central Artery; purchase thousands of new subway and rail cars; upgrade signals, maintenance facilities, electric power systems, bridges and tunnels; and make accessibility improvements, among other work.

The capital plan calls for $6 billion to be spent on improvements to Metro-North, including replacement of outdated rolling stock, upgrades to aging station platforms and investments at the most vulnerable locations during extreme weather. Another $6 billion is allocated for the Long Island Railroad, which will fund rolling stock replacements, power system improvements and accessibility upgrades.

Other highlights of the funding plan include the reallocation of $1.2 billion from the Penn Station redevelopment project to priority capital projects, such as the Interborough Express. In FY2026, New York city will be required to provide $3 billion in funding, and the MTA will be required to find $3 billion in efficiencies.