Cuomo Seems To Be Zeroing In On "Surprising" Choice For Next NY MTA Chair

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Joe Lhota.

(New York, NY) - The committee appointed by New York Governor Cuomo to find the next CEO and chairman of the NY Metropolitan Transportation Authority has completed its work. The governor is now mulling a short list with six names on it, culled from eleven candidates interviewed for the job. Sources familiar with the process say the name at the top of the list is Joseph Lhota, executive vice president of Madison Square Garden and former right hand man to Mayor Rudy Giuliani.

Lhota served in the Giuliani administration for six years, first as budget director and then as deputy mayor of operations. He also worked as an adviser to Giuliani's presidential campaign in 2007-2008.

Other known finalists are NYC Transit President Thomas Prendergast, who oversees 50,000 subway and bus employees; Nuria Fernandez, senior v.p. at an infrastructure management company and former deputy administrator with the Federal Transit Administration; Karen Rae, deputy administrator of the Federal Railroad Administration and a former commissioner of the New York State Transportation Department; and Daniel Grabauskas, the Mitt Romney-appointed general manager of the Massachusetts Bay Transportation Authority who resigned under pressure from Governor Deval Patrick in 2009.

Lhota is considered the leading candidate by those familiar with the search process. Reaction among transit watchers, none of whom would speak on the record to avoid alienating the possible next chief of the NY MTA, was part puzzlement and part wait-and-see.

"I was a little surprised that Joe Lhota rose to the top of that pool," said an official from a previous mayoral administration. "He understands inter-governmental relations and he understands the politics but he’s more of a political operative than a manager."

Both Cuomo and outgoing MTA chairman Jay Walder have said in the past few weeks that the next chair did not need to have a transit background. “I think it is helpful to have a knowledge of mass transit," Walder said at the NY MTA's September board meeting. "I don’t know that it’s an absolutely essential quality.”

Lhota fits that profile. His resume shows no transportation posts. But he did manage large governmental agencies in the Giuliani administration and ran the city when the mayor was out of town. Since then, he has navigated the executive suites of the Cablevision Systems Corporation and Madison Square Garden. And Lhota has served as a board member at the City University of New York for the past ten years.  Lhota was one of two board members who did not support withholding an honorary degree from playwright Tony Kushner last May.  The vote to table the degree past last spring's commencement was much-criticized and later reversed.

Jonathan Bowles, director of the Center for an Urban Future, a policy think tank, said he didn't know Lhota well enough to comment specifically.  But he said that from a leadership perspective, "It’s important someone be selected who can really make a strong case for transit and can convince legislators that this is so critical to the city’s future and that we’re on the precipice of something bad happening."

Bowles added that the stakes are enormous: "If there’s one thing Governor Cuomo could do now to boost the city’s economy, it’s shore up the transit system."

The precipice on which the NY MTA teeters consists of several difficulties: a 2012-2015 capital construction plan with a $10 billion dollar shortfall; a looming contract negotiation with Transport Workers Union Local 100 that, by all signs, will be acrimonious; a threat from a group of state legislators to cut the dedicated revenue stream that is the regional payroll mobility tax, which last year contributed $1.3 billion to authority coffers. That's about an eighth of the authority's operating budget.

Sources differed on Lhota's ability to rise to those challenges. The NY MTA needs someone "who can handle the union relationships, the crisis of money, and Lhota will get it faster than most people," said one. Another thought the Republican Lhota could help the Democrat Cuomo beat back a Republican-lead push in the state legislature to eliminate the payroll mobility tax.

But a third believed Lhota was the front-runner precisely because he won't speak up too loudly for the needs of mass transit: "He’s gong to be the person who makes the cuts without making any demands on the state budget. He may even then turn around and say to the city, 'It’s all your fault.' He’s going to protect Andrew Cuomo from the hard choices."

Earlier today, the governor said at a press conference: “We’re going to have an announcement on the MTA shortly." He added that the public would know his nomination for the chairmanship within “days.” Cuomo has told members of the search committee that he wants to name that person before Jay Walder decamps from the $350,000 a year post on October 21 to run a private rail and real estate company in Hong Kong.