Governor Plans to Boost MTA Budget by Taxing NYC

By Tim Minton
|  Monday, Feb 8, 2010  |  Updated 7:27 PM EDT
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Governor Plans to Boost MTA Budget by Taxing NYC

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Nevermind that the MTA serves the suburbs, too, the New York City businesses are the ones who will be getting taxed.

The MTA's budget could be back on track if Albany adopts a new tax proposal drawn up late today by Governor Paterson.

The plan would cut payroll taxes in suburban counties -- and shift the burden of closing the MTA's budget gap to New York City businesses.

"The new proposal I am putting forward will provide relief to straphangers, as the MTA makes the difficult decisions necessary to balance its budget during an historic fiscal crisis that is significantly impacting all levels of government," Governor Paterson said. "In addition, it also makes key improvements to the current tax structure, promoting regional equity and delivering relief to small businesses."

If the new tax is approved and actually generates the revenue Albany claims it will  one might think that drastic additional service cuts might not be necessary.

But the MTA  said that the governor's budget boost is just a drop in the bucket.

"The MTA is grateful to Governor Paterson for his continued focus on funding the MTA and the critical service we provide to 8.5 million New Yorkers every day," said agency spokesman Jeremy Soffin. But, he added, "It would not eliminate the need for the service cuts and administrative reductions included in the MTA Budget passed in December."

Mayor Bloomberg, of course, wsn't happy with the plan.

“First the Governor proposed a state budget that slashes support for New York City but not the suburbs, and now he proposes to wallop city businesses with more taxes while lightening the load for businesses in the suburbs," the mayor said in a statement. "The idea that the State can spare the suburbs while sacking the City is terrible economics, grossly unfair, and contrary to every principle of good regional development."

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