The base subway and bus fare in New York City would rise to $2.50, up from $2. A 30-day MetroCard would cost $103, up from $81. A monthly ticket on the Long Island Rail Road for a commuter who travels between Ronkonkoma and Pennsylvania Station would increase to $352, up from $278.

The Times yesterday asked the Chairman of the MTA whether he had a message for lawmakers in Albany: “Mr. Hemmerdinger said, with his voice cracking slightly: ‘How about just, Help.’” The drama of that statement plus all of the quotes coming from MTA affiliates and commuter groups blaming Albany (usually those groups are quick to attack the MTA) gave me the impression that the MTA was playing hardball with the state government. The great thing about working at a large PR firm is that, regardless of the topic, there is someone who knows a lot about it. I talked with a coworker and he very politely informed me that I have no idea what I was talking about.

His first point is that the MTA is required to balance its budget every year so they never really play politics, they just try to meet their dealines. I think this is somewhat unique to the MTA since I remember in Boston people bemoaning the massive debt of the MBTA. I also found out that the main source of the MTA’s revenue (after ridership fees)  is real estate transfer taxes. If I buy a brownstone, or if Trader Joe’s opens a new store in Brooklyn Heights, there is a surcharge that goes to the MTA. This worked great when Tishmen-Speyer was buying multi-billion dollar developments and the taxes from that transaction alone were able to fund the MTA for an entire year. However, the real estate market has collapsed and along with it that revenue stream.

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I am not 100% sure about this next part and am going to start doing more homework, but during the 70s the MTA pretty much completely collapsed (along with the rest of New York) because of a combination of economic stagnation and crime driving down ridership (Charles Bronson notwithstanding). That, I think, is when they added a commuter tax to anyone who lives in the Greater Metropolitan area (I don’t know how they knew who worked in New York City) and combined it with a real estate transfer tax. Things went well and during the 90s, when things were booming, the commuter tax was repealed. This seems similar to a lot of the things that have been hurting the economy. Organizations based financial models on the theory of never-ending growth, so as things start to slow down it becomes a downward spiral.

There are several proposed rescue packages being worked on in Albany. However, there hasn’t been a lot of public outcry (yet) and Albany is facing such a huge budget gap itself it isn’t racing to send money away. Additionally, times are tough so I think people are just expecting to pay a little more for services. There are a few bailouts being discussed and it looks like the main conflict is basically between Senate Majority Leader Malcolm Smith and everyone else.

I don’t know nearly enough about the details (yet) to be able to have an opinion on the various plans being discussed. However, it seems to me that, in theory, MTA basic services should be funded by a combination of fares and a tax that isn’t reliant on growth (I think one of the plans is proposing a payroll tax, that sounds about right) and the real estate transaction fee should go into a special fund for new developments and capital improvements.

I will be trying to follow this issue a little more. The first step is subscribing to the RSS feed of the excellent Streetblog and I am eager for any book suggestions that anyone might have about the MTA specifically or subways in general.