New York MTA Identifies $427M in 2024 Proposed Budget Savings

New York’s Metropolitan Transportation Authority (MTA) released its preliminary operating budget for 2024, the second of five years to have a projected balanced budget.

The November Financial Plan outlines $427 million in operating efficiencies, exceeding the target of $400 million in savings as projected in the July Financial Plan. The MTA is ahead of schedule toward identifying $500 million in savings annually beginning in 2025.

The MTA’s Budget Savings

The MTA has identified specific savings across all its agencies, delivering on its promise in the New York State Budget agreement of achieving $400 million in savings in annual operating efficiencies. These savings include improving employee availability while reducing overtime costs by strategically managing assignments within compliance of timekeeping rules within New York City Transit.

Identified efficiencies within Long Island Rail Road and Metro-North Railroad include collaborating to identify best industry practices in equipment shops and ensuring appropriate inventory availability for required maintenance. Bridges and Tunnels reviewed staffing requirements, reducing vacancies. These efficiencies together will save the MTA $427 million in 2024, going beyond what was promised in the New York State Budget.

“Governor Hochul’s State Budget stepped up for the MTA and — more importantly — for transit riders. One key element was an agreement that the MTA implement $400 million in operating efficiencies, and the 2023 November Financial Plan delivers — the cost savings surpass our 2024 goal and set us on a path to achieve $500 million in annual recurring savings by 2025,” said MTA Chair and CEO Janno Lieber. “Fiscal stability allows us to continue to deliver frequent, reliable service while executing our historic capital program, including unprecedented investments in State of Good Repair work and ADA accessibility.”

Ridership and Tolls

While paid ridership on subways and commuter railroads continues to increase in accordance with the midpoint scenario as projected by the consulting firm McKinsey, paid bus ridership is now trending below the low case scenario. Crossings at MTA Bridges and Tunnels continue to track at or above pre-pandemic levels.

In July, the board approved a 5.5% toll increase and 4% fare increase for 2023, which went into effect in August. Those moves are projected to generate $117 million in 2023. The five-year plan assumes an additional 4% increase in both 2025 and in 2027.