Spring 2003, p.8
In double bombshell accusations, the New York State Comptroller and New York City Controller issued separate reports in April showing that the MTA kept two sets of books and hid $500 million over several years in order to justify the 50-cent city bus and subway fare increase. The reports were based on MTA financial records that the officials obtained through legal subpoenas after repeated refusals by the MTA to provide complete records. State Comptroller Alan Hevesi said that the MTA "stonewalls, hides information, hides money, misleads the public" and has a "culture of deceit…and is in tremendous need of reform."
MTA Chairman Peter Kalikow, a Republican and close friend of the Governor Pataki, blasted Hevesi and said that his report is a "Political document filled with lies, half-truths and innuendos." However, though Hevesi and City Controller William Thompson are both ambitious Democratic career politicians, they also have reputations for being cautious, sober-minded and low-key.
Indeed, even though New York State is gridlocked by partisan politics, Hevesi and Thompson's accusations were front page news, with big implications for the MTA, governor and transit riders. Riders interviewed by reporters were outraged, with many calling for jail time and even "heads on sticks." Despite their blistering criticism of the MTA, neither auditor claimed that the MTA had committed any criminal misdeeds.
Judge Slams Bogus Hearings, Tells MTA to Rollback Fare
On May 14, Manhattan State
Supreme Court Justice Louis York ordered the MTA to roll back the fare
increases on city subways and buses, the Long Island Rail Road, MetroNorth and
Long Island Bus by May 28 and to hold a new round of public hearings. The
judge also halted the closure of 62 subway station booths.
The MTA faces its worst crisis of public confidence in its 35-year history. Whatever the fate of the $2 fare, the decision should force sweeping changes in the way that the MTA reports its finances.
The state legislature is considering a range of reforms, including an Independent Budget Office for the MTA, a computerized registry for MTA contracts and more independence and clout for the MTA inspector general. Many of the most important changes are in a bill sponsored by Assemblymember Richard Brodsky. The legislature should act on these ideas.
Governor George Pataki, Mayor Michael Bloomberg, the state legislature and the MTA need to take immediate action to restore the MTA's credibility. Pataki should appoint an independent blue ribbon panel-known under state law as a "Moreland Act" commission-with subpoena power to investigate the MTA's budgeting and finances and charges of corruption in the agency's contracting. Bloomberg should use the City's considerable resources to audit the MTA's finances and to call off his proposal to slash City payments to the MTA.
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