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Jul 31, 2024 View in browser
 
POLITICO New York Playbook PM

By Jason Beeferman

Governor Kathy Hochul and MTA Chair and CEO Janno Lieber today rode the inaugural Long Island Rail Road train to Grand Central Madison, which arrived at the terminal platform at 11:07 a.m.

MTA CEO Janno Lieber said he trusts Gov. Kathy Hochul's promise to find the funding now missing after the congestion pricing pause. But he also wanted to show the public what will happen if she doesn't. | Office of Gov. Kathy Hochul

¿QUÉ SERÁ SI NO SERÁ?: The MTA really, really wants to take Gov. Kathy Hochul at her word that she’ll fully fund the critical transit projects thrown in flux because she halted congestion pricing.

But just in case Hochul won’t be able to find $16.5 billion in the couch cushions despite saying she will, the MTA would like to show what could happen to its operating budget.

“The chief executive of the state of New York saying a dozen times that she intends to fully fund the existing MTA capital program, as well as to fully provide for the next MTA capital program, is a commitment that we have to take account of,” MTA CEO Janno Lieber said at a press conference today, following the MTA board meeting.

“But we're also doing our job, I believe,” he added. “We're all providing the information about what would take place if for any reason those commitments were not to be met, and that's what I call being business-like.”

The information is pretty ugly.

If the revenue expected from the congestion toll money never materializes, it’s going to cost the agency’s operating plan anywhere from $800 million to $1.5 billion over three years starting in 2025, according to MTA data and calculations from the group Riders Alliance, among others.

Those costs would stem from the need to deal with debt earlier, having to use the operational funds to pay employee salaries that would’ve been paid for out of the capital plan, lower expected ridership and fare revenue, significantly increased maintenance costs and slower-than-expected buses.

Remember, that would be in addition to the $15 billion (which later became $16.5 billion when the risk of losing federal grants started becoming clear) hole that still hasn’t been resolved, despite Hochul repeating that “nothing that was on the drawing books is going to be delayed.”

And there’s only so many ways to fund the MTA. If the governor does deliver on $15 billion in funding — through taxes or tolls or other measures — that could mean there are less options to bail out the MTA when it encounters other non-congestion pricing related fiscal problems.

And the MTA says those problems already exist.

The agency announced today that it expects to face a $428 million deficit in 2027 due to fare evasion, lower ridership and lower real estate taxes — irrespective of any congestion pricing developments.

But the governor’s team remains adamant she is committed to finding a solution. On Tuesday, she took a $54 million step toward ensuring the federal dollars tied up in the Second Avenue subway extension would not dry up.

“After saving the MTA from the ‘fiscal cliff’ in last year’s budget, Governor Hochul remains committed to funding the MTA Capital Plan, and she is working with partners in government on funding mechanisms while congestion pricing is paused,” said John Lindsay, a spokesperson for Hochul. — Jason Beeferman

 

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From the Capitol

Mayor Eric Adams shakes hands with Gov. Kathy Hochul

Mayor Eric Adams and Gov. Kathy Hochul shake hands at an announcement celebrating the closure of illegal cannabis shops in the Bronx on Wednesday. | Ed Reed/Mayoral Photography Office.

CROP COPS: Mayor Eric Adams and Hochul announced they’ve closed more than 750 illegal cannabis shops in the city and over 1,000 statewide.

Today’s announcement in the Bronx is the result of Hochul delivering on a key priority for Adams — who had requested more support in shutting down the illegal shops as one top five asks on his state budget wishlist. (Hochul came through on all five.)

“The beauty is, you have a mayor who listens, who understands the power of the office of the mayor,” Hochul said. “That is the kind of partnership I so appreciate.”

It’s a marked shift from the relationships between past New York governors and mayors.

Today’s announcement is the latest of the mayor’s several appearances over the summer to highlight the success of “Operation Padlock to Protect,” the multi-agency effort to shut down illegal cannabis shops across the city. The program has seized $41 million of illegal products and issued over $65 million in violations since beginning in May, Adams said.

And it comes as he is fending off increasing challenges to his management chops from mayoral hopefuls who want to unseat him next year.

Adams also outlined the next steps in the fight against illegal shops, including going after landlords who rent to unauthorized shops, and ensuring violations are paid in full.

“We intend to collect every dollar,” Adams said. — Rich Mendez

BIDEN PICKS BRINDISI: Former member of Congress and the state Assembly Anthony Brindisi has been nominated for a judgeship on the Northern District of New York, President Joe Biden’s office announced this morning.

Brindisi represented the Utica area in the Assembly for four terms before toppling Republican Rep. Claudia Tenney in 2018. Tenney won a comeback bid two years later after an election so narrow that the recount lasted until February. Brindisi lost a 2021 bid for a supreme court seat, but was nominated by Hochul for the Court of Claims in 2022. — Bill Mahoney

THE MINIMUM: New York Democrats want to flip five GOP-held House seats in New York — and today Hochul set a floor for victory in November.

Hochul on CNN indicated winning half of the contested six seats — one is held by Democratic freshman Rep. Pat Ryan — would be sufficient.

“I want all six. I think three minimum and that'll be enough,” she said. “But I feel very confident. We have strong candidates.”

Democrats and Republicans view New York as central to the fight for control of the narrowly divided House.

The GOP made gains in pivotal seats on Long Island and the Hudson Valley in 2022, and Hochul received some of the blame for the party’s poor showing in New York when she led the ticket.

Now the state Democratic Committee is building out its infrastructure to aid down-ballot candidates, a move that is meant to be a departure from prior elections in which the state party largely served the political needs of the sitting governor.

Hochul in recent days has framed the push around building a large Democratic majority in Congress to aid a possible Kamala Harris administration.

The governor, who had been a staunch ally for President Joe Biden, does not have a favorite in the running mate selection. And she said this morning she’s not concerned that the leading contenders — including Govs. Andy Beshear of Kentucky, Josh Shapiro of Pennsylvania, Tim Walz of Minnesota and Arizona Sen. Mark Kelly — are all white men.

“The beauty of what we have here is we have a lot of talent,” Hochul said, adding, “Whoever she picks — it’s going to be a dynamic duo.” — Nick Reisman

IN OTHER NEWS...

— ADAMS’ CAMPAIGN FUND WOES: A draft audit into Adams 2021 campaign found millions of dollars in undocumented expenses and the potential of a $3 million fine. (Gothamist)

— GO DEEPER: Still want to read more about the MTA today? Here’s a deep dive on the other topics — including the ballooning cost of fare evasion — that were discussed at today’s MTA board meeting. (Bloomberg)

— BRONX LEADER’S PASSING: Stanley Simon, former Democratic Bronx borough president, is dead at 93. (The New York Times)

— MIGRANT BUS SUIT: Mayor Eric Adams’ $700 million lawsuit against bus companies that transport migrants to the city has been denied by a judge. (New York Post)

Missed this morning’s New York Playbook? Read it here.

 

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