Dec. 19 (Bloomberg) -- Joseph Lhota, who was widely praised for reviving the New York City subway system after Hurricane Sandy, will resign as chairman of the Metropolitan Transportation Authority to explore a run for mayor.
Lhota’s announcement, which came minutes after the largest U.S. transit agency’s board voted to raise fares and tolls, will clear a path for him to pursue a bid for mayor of New York City as a Republican. The MTA chairman is barred from participating in political activity.
The 58-year-old Bronx native is no stranger to City Hall, having served as deputy mayor under Rudy Giuliani. He will decide whether to declare his candidacy within weeks, he said, and described as “bittersweet” his departure so soon after Sandy caused the worst damage to the subway system in its 108-year history. He will step down Dec. 31.
“I never expected this opportunity to arise, but I will use every part of this opportunity to support the MTA,” Lhota said in a news briefing following the board meeting. Resigning on the same day as telling New Yorkers they will have to pay more to commute, Lhota said to laughter, was “an act of courage.”
The board voted to raise its base fare for subways and buses by 25 cents to $2.50 and monthly unlimited passes by $8 to $112. The increases will take effect in March, marking the fourth fare boost in five years. Also included are higher prices on river crossings and railroads, part of a plan to net an annual $450 million in additional revenue.
Lhota’s announcement, just over a year after he took over daily operations, threatens to disrupt the already struggling state agency. Sandy’s destruction has officials lobbying Congress for $5 billion in repairs, in addition to billions more to prevent future damage. Even before Sandy hit Oct. 29, the MTA wasn’t done digging itself out of a fiscal hole exacerbated by the 18-month recession that ended in 2009.
The MTA has also yet to reach a contract deal with the Transport Workers Union Local 100, the agency’s biggest bargaining unit, after building into its budget three years of no wage increases. And the authority is fighting a legal battle over a payroll tax projected to pump $1.26 billion into its coffers. A state judge struck down the levy in August as unconstitutional.
Under the fare and toll plan, weekly unlimited passes for subways and buses will rise $1 to $30, and a 7 percent discount on purchases of $10 or more will fall to 5 percent and apply to those as small as $5. Base fares on express buses will jump to $6 from $5.50.
Tolls on most MTA crossings, including the Robert F. Kennedy Bridge and Queens Midtown Tunnel, will increase to $5.33 for E-ZPass users from $4.80 and to $7.50 for those paying cash, from $6.50. Long Island Rail Road and Metro-North riders will continue to pay based on length of trip, time of day and type of ticket purchased. The price of most tickets will go up by 8.2 percent to 9.3 percent.
Lhota said the increases were unavoidable due to rising labor and debt costs. They were set in motion years ago when the agency planned to enact biennial fare and toll increases to make up for insufficient state and federal support, he said.
“We are not the fat, profligate, out-of-control agency that people have tried to make the MTA out to be,” Lhota told the board. “We are an agency that 8.5 million people rely on every single day” and without it, the economy of the New York City metropolitan area couldn’t function.
Riders already pay the second-highest share of operating costs of any transit system in the country, according to the Citizens Budget Commission. The MTA will continue lobbying Washington and Albany lawmakers to win more funding in hopes of staving off the next fare and toll increase planned for 2015, Lhota said.
Gene Russianoff, a commuter advocate, said the constant managerial changes at the top of the MTA threatens that quest.
“There have been six MTA leaders in the last six years,” said Russianoff, senior attorney at the Straphangers Campaign. “That has not helped the cause of winning safe, reliable and affordable transit.”
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