Can New York Afford Rail Transit?

The Antiplanner has often said that New York City is the one city in America that truly needs rail transit because the concentration of jobs in midtown and downtown Manhattan is too great to be served by surface streets alone. But can New York afford rail transit? The city’s transit system has been getting by on bridge tolls, loans, deferred maintenance, unfunded pension and health care obligations, and turning a blind eye to major structural problems with its rail system.

The New York’s Metropolitan Transportation Authority (MTA) latest financial statement says that, at the end of 2016, the agency had long-term debts of $37 billion (p. 25). By now, it is above $38 billion, more than that of many small countries. The statement also says the MTA has $18 billion in unfunded pension and health-care obligations (p. 83).

Unlike some transit agencies, MTA hasn’t made public any estimates of its maintenance backlog. But its latest capital improvement program calls for spending more than $32 billion over the next five years, mostly on maintenance and rehabilitation of the subways, Long Island Railroad, and Metro North railroad. This is more of a goal than a plan, as it will require $7.5 billion in further borrowing plus getting several billion dollars from federal grantmaking programs that the administration wants to cut. Even if fully funded, it probably would not completely eliminate the rail systems’ maintenance deficits.

The capital improvement plan includes a token amount for the Second Avenue Subway. The first two miles of this subway opened at the beginning of this year at a cost of $4.5 billion, but the city wants to spend at least $12.6 billion adding six more miles, of which just $1.7 billion is in the capital plan.

Then there is the Gateway Program, a plan to rebuild the rail line between Newark and Manhattan, including the tunnels under the Hudson River. This is estimated to cost $20 billion. This route is used by Amtrak trains, but most of the trains using it are run by New Jersey Transit.

New Jersey Transit has its own maintenance problems, which probably contributed to some of the 150 accidents the agency has experienced in the last five years. Like MTA, the agency hasn’t published estimates of its maintenance backlog, but it is probably significant. It’s capital improvement plan calls for spending $13.9 billion over the next five years, mostly rehabilitating worn out rail lines.

Again, I am dubious that this will be enough to eliminate New Jersey Transit’s maintenance backlog, and also again, I suspect the agency won’t be able to find $13.9 billion partly because the Trump administration wants to end some of the federal programs they are relying on. On top of this, New Jersey Transit has $2.8 billion in debt and unfunded liabilities.

In all, then, New York is looking at needing at least $65 billion to rehabilitate MTA and New Jersey transit lines, and this doesn’t even count trains coming into New York from Connecticut. The region obviously doesn’t have that money or it wouldn’t have borrowed more than $50 billion to get where it is today and have nearly $20 billion in unfunded liabilities.

Where is this money going to come from? New York is the nation’s largest and probably wealthiest urban area, yet it hasn’t been able to maintain the system it has even as it spent or plans to spend nearly $30 billion on new rail lines (Second Avenue, East Side Access, and the 7 subway line). The region, including northern New Jersey and southwest Connecticut, has about 19 million people, so the total debt and planned capital expenses adds up to around $8,400 per person.

Just as elsewhere, the real problem is that rail transit is an expensive technology. More than $2 billion a mile to build new subway lines? That’s enough to build a hundred miles of four-lane freeway. The secondary problem is that politicians aren’t willing to ask people to pay for what they use and prefer to put off costs to far enough in the future that they are no longer in office.

It’s time to start thinking about alternatives. I previously said that New York needs two levels of traffic to move 2 million workers into Manhattan every day: the surface streets and the subways. But nothing says that the subways have to be rail. Why not start planning to replace the trains with driverless electric buses? Capital costs are far lower (railcars cost about ten times as much as buses, and three or more times as much after adjusting for capacities and lifespans), maintenance costs are far lower, and–if the buses are driverless, which should be technically easy to implement on former rapid transit routes–the operating costs will be a lot lower. Perhaps I should reconsider my statement that New York is the only city that needs rail transit.

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