State legislative leaders reject MTA capital plan, intend to include it in budget talks

ALBANY — The Democratic leaders of the state Legislature on Tuesday rejected the Metropolitan Transportation Authority’s capital proposal intended to pay for billions of dollars in critical upgrades and repairs on the massive transit system, according to a letter from Assembly Speaker Carl Heastie and Senate Majority Leader Andrea Stewart-Cousins.

The Democratic leaders said the plan must be part of budget deliberations with Gov. Kathy Hochul. The 2025 state budget is due April 1.

In September, the MTA board approved a $68.4 billion capital plan that included several critical improvements to the Long Island Rail Road. The program included $6 billion for the LIRR over the next five years, with the planned work to include electrifying the Main Line to Yaphank and the Port Jefferson branch.

But the legislative leaders said the proposed program includes a deficit of at least $33 billion.

That hole "is a specific concern that needs to be addressed before we can approve the program," stated Heastie and Stewart-Cousins. The legislative leaders are also members of the MTA Capital Program Review Board, which gave them the authority to reject the proposal.

"It’s not the plan, it’s the money that’s lacking and where the money is coming from," said a state official familiar with the leaders’ effort who wasn’t authorized to comment.

The MTA said the Christmas Eve rejection was a surprise, after the capital program was prepared and announced without objection.

"This Capital Program was grounded in our 20-year needs assessment, and we haven’t heard any concerns or objections from the Legislature since it was approved by the MTA Board in September," said John J. McCarthy, the state authority’s chief of policy and external relations. "It will unlock dozens of transformative projects — many of which are funded and ready to go on January 1st. We remain optimistic that the Legislature will join the governor in supporting safer, more reliable, and expanded transit."

Hochul spokesman Avi Small said in a written statement that the MTA's plan would improve subway service, support suburban commuter rail and meet other needs.

"Now that the Legislature has raised these objections to the capital plan," Small said, "we look forward to seeing their recommendations on which of these projects should be deprioritized and which revenue streams they are willing to propose."

Federal help?

Heastie spokesman Michael Whyland, however, said Tuesday that several MTA capital projects are already underway and the rejection shouldn’t delay or derail any major work. The state legislative leaders also noted that the state needs to see how much the Trump administration, which takes office Jan. 20, will contribute to the capital program for the nationally critical transit system.

"The federal government needs to step up and do its part because we don’t know if we can do it alone," Whyland told Newsday.

The MTA program was funded in part by fees from the congestion pricing plan approved by the state Legislature and then-Gov. Andrew M. Cuomo in 2019. But days after the MTA approved its capital program in September, Hochul "paused" the congestion pricing plan. She eventually reduced its revenue by decreasing the basic fee to $9, from $15. She said New Yorkers hit by inflation and recovery from the COVID-19 pandemic couldn’t handle the $15 fee.

Stewart-Cousins and Heastie said in the letter that filling the gap may require action by the state Legislature, which isn’t scheduled to start to 2025 session until Jan. 8. That would allow for development of "non-state revenue sources," such as federal funding.

The legislative leaders said they will work to create a "fully funded capital program."

But placing the MTA capital program into Albany’s closed-door budget negotiations between Heastie, Stewart-Cousins and Hochul means the issue could be part of horse-trading of disparate items.

"Given that the Governor has the upper hand in both controlling the MTA and the budget process, the Legislature is using the leverage they have to influence their capital plan," said Rachael Fauss of the Reinvent Albany good-government group.

By Michael Gormley

michael.gormley@newsday.com@GormleyAlbany

Michael Gormley has worked for Newsday since 2013, covering state government, politics and issues. He has covered Albany since 2001.