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NEW YORK, NY July 26, 2007 —The MTA's proposed fare hike is just one part of a four year financial plan that will be closely scrutinized by board members before the end of the year. WNYC's Beth Fertig has more.

REPORTER: The MTA's pension and welfare costs are rising and so is its debt service. That's why some budget and transit watchdogs are praising the MTA's leadership for proposing to apply this year's expected surplus from real estate taxes to close next year's estimated $800 million deficit.

REPORTER: The authority is also planning to save money by purchasing diesel fuel in advance and asking its agencies to trim fat without cutting services. And it says small fare hikes should be expected every two years so riders aren't hit with sudden increases.

REPORTER: But, riders groups and the transit union think the state could contribute more. The MTA's budget calls for $600 million from Albany in 2010. Meanwhile, if there is a fare hike, the Straphanger Campaign is proposing a two week Metrocard, which would be cheaper than a monthly pass but offer a greater discount than a weekly card. For WNYC, I'm Beth Fertig.