Thank you for having me on the program on Tuesday morning. I always appreciate the opportunity to talk with you and to answer questions from our customers who are your listeners.
We are reaching out via Facebook to the caller who spoke of problems reaching an employee with the intercom at 181st Street. I’ve also spent some time after the show looking at the comments that your listeners left on your website. Seeing the volume of the comments reminds me how fundamental the MTA’s services are to our lives as New Yorkers. There were nearly 100 responses within an hour of my segment on the program. I can't respond to every comment individually, but I wanted to share some thoughts on some of the major topics that came up.
The MTA was able to limit the fare revenue increase to 7.5%, as agreed to with the Governor and Legislature in May 2009 as part of the MTA rescue package, despite a $900 million shortfall for 2010 resulting from cuts to State assistance and dramatic downturns in tax revenue. We were able to do this through the most comprehensive internal cost cutting initiative ever undertaken at the MTA, which will save the agency $380 million in 2010, translating into more than $500 million in annual recurring savings.
The fare proposal is designed to raise the necessary revenue while maintaining ridership as much as possible, minimizing impacts to lower-income customers, and increasing efficiencies of fare collection. Some listeners asked about of the customer impacts of increases to different types of MetroCards. From a recent survey of customers, we know that the median household income for users of the 30-day MetroCard is $63,000. Users of the 30-day unlimited card have a median household income of $63,000, which is the highest of all New York City Transit customers. They would continue to benefit from significant discounts on a per-ride basis as compared with pay-per-ride users. (A rider taking 90 rides in a month would pay $1.16 per ride.) By comparison, users of the 7-day card have a median household income of $38,000.
As I said on the air, there are two different toll proposals. The first would fairly evenly distribute the increase to both E-ZPass and cash customers. The second would increase tolls paid by our cash customers by a slightly larger amount while leaving E-ZPass tolls unchanged. Clearly there's a healthy debate between cash customers and the E-ZPass customers about which proposal we should take. Both proposals are on our website. We'll be looking at both options, and the decision will be made at end of October.
I agree with Rob from Brooklyn who notes that our countdown clock effort is not about breaking new ground technologically or adding a fancy, never-before-seen new feature. The countdown clocks are about providing a level of service that is in place in much of the world. However, the monetary investment in these clocks has already taken place. What we've done is taken a new approach to the way the clocks are being managed so the benefits are realized more quickly. I believe that being able to know how much longer until your train or bus is coming is a very real and significant benefit, potentially transforming the way our customers use our services. While we have had service cuts, the reality is we move 8.5 million a day and we have an obligation to continue to improve service in cost effective ways.
Balancing the MTA budget
Finally, a number of your listeners, like Lucy from Brooklyn and Carter from EV, raise questions about how efficient we are at the MTA, asking whether we're really using the money wisely. As noted above in response to the fare questions, we are fundamentally overhauling the way the MTA does business. This has so far included eliminating more than 3,500 administrative and operating positions through layoffs, voluntary separations and elimination of vacant positions, freezing pay for management employees, increasing efficiency of paratransit and Bridge and Tunnel operations, dramatically reducing the use of overtime, eliminating or deferring projects, consolidating functions, renegotiating contracts with vendors and more efficiently managing our inventories.