When the MTA releases its 2024 Preliminary Budget this week, its updated estimates of revenues and expenses will show how much the State rescue plan improved the MTA’s fiscal position during the financial plan five-year window. In Stabilized, for Now: The MTA's Operating Budget's Long-Run Outlook, CBC reveals the budget should be manageable over the next five years, but the MTA still has a long-run structural gap—$900 million—that will reemerge in 2029.

With a runway to plan and negotiate needed changes with labor, the MTA should start now to bring its spending in line with its recurring revenues, lest it return to taxpayers and riders for a new infusion of extraordinary taxes or fare hikes in just a few years.

CBC's analysis of currently available financial data also found that:

• The MTA’s budget gap for 2023 had widened to $2.6 billion largely due to declining ridership, the decision to skip the 2021 fare increase, and a substantial increase in fare evasion;
• The cost of the Transport Workers Union (TWU) Local 100 collective bargaining agreement, extended across the MTA, exceeds budgeted raises by $330 million annually;
• Operating costs are currently projected to grow 3.3 percent per year from 2023 to 2026, outstripping planned fare and toll increases of approximately 2 percent a year; and 
• The MTA budget is subject to risks that could reduce revenue or increase costs but may also benefit from positive economic and ridership changes.

Substantial efforts are needed to contain costs; taxpayers and riders should not pay more than is necessary for reliable, high-quality service. To stabilize finances, the MTA should:

1. Implement one-person train operation (OPTO) on subways and proof of payment on commuter rail, industry standard practices that would increase efficiency;  
2. Reduce maintenance and operating costs by targeting peer benchmark levels; and 
3. Negotiate work rule changes with labor unions to allow the MTA to adjust schedules and services to meet shifting rider needs.