The Jay Train: M.T.A. Chief’s Tough Sell

jay walder kurt raschke 300x225 The Jay Train: M.T.A. Chiefs Tough SellThe perennial attempt to hike subway and bus fares is one of the more ritualistic political dances in New York. Any leader of the Metropolitan Transportation Authority who ever tries logic (fares, adjusted for inflation, are virtually the same as in the mid-1990s) is inevitably met with a blast of criticism. Politicians decry the move. Riders voice disgust. Protests ensue. The M.T.A. just doesn’t get what it does to the little guy.

Such is the position of Jay Walder, the M.T.A.’s still-new leader, who has many an innovative, rider-friendly idea (Countdown clocks! Cell-phone service underground! Fast buses throughout the city!), but who has spent much of his nine months on the job cutting costs, scouring for efficiencies, rolling back service and, now, increasing fares.

On Wednesday, July 28, the M.T.A. chairman and CEO is expected to plunge into an inevitable public swamp when he unveils the agency’s latest set of hikes, to be implemented in January, including a $10 jump, with new restrictions, for the monthly unlimited card-a 7.5 percent overall increase that Albany legislators initially gave a nod to last year.

“Notwithstanding the shortfall in resources that have come, we have held to the number that had been previously agreed [on],” Mr. Walder said, speaking from behind a worn wood conference table in the M.T.A.’s midtown offices Monday, wearing a white shirt with subway token cuff links. “The speaker of the Assembly, the Senate majority leader, the governor-all stood together and said we expect a seven-and-a-half percent increase on the transit system in January 2011. That’s what we’re doing.”

The question for Mr. Walder, then, is whether he will ever be able to unshackle himself from fiscal issues sufficiently to install more noticeable, meaningful changes-an undertaking that would take time and money-or will he continue to have to put out these fiscal fires, started long before his arrival, with viciously unpopular actions?

A bit of background on M.T.A. finances: Even within the context of a state government barreling toward fiscal ruin, the M.T.A.’s financial situation is especially problematic, as the elected classes treat the agency a bit like a sick patient never given enough nourishment to stand on its own.

Rather than devote to the M.T.A. enough long-term funding sources so that it can sustain itself over time on fares, tolls and specific taxes, New York has settled on a system where funding runs dry for capital projects-repairs and new construction-about every five years. At that point, the M.T.A.’s chief either goes hat-in-hand to Albany, seeking some sort of new M.T.A.-specific tax (this happened last year, to some success), or to the general public, attempting a referendum to allow the agency to essentially borrow from the state’s general fund (this happened in 2005).

And when one or both fail (like in 2000), the agency-semi-independent from both the city and the state-simply resorts to borrowing billions, often beyond its means, leaving the next M.T.A. chair to worry about how to pay for it.

Add to that an economic crisis that has drained revenues, expansion projects that are billions over budget and $800 million in unexpected shortfalls that have emerged within the past year, and you get the situation in which Mr. Walder, who left a nice job at consulting giant McKinsey & Company, finds himself.

“When I heard that he was possibly going to do it, I said, ‘There’s no way this guy is going to want to take a pay cut to take this,'” said an M.T.A board member.


MR. WALDER, 51, is a physically imposing figure at 6-foot-6. He towers over most other speakers at public events, creating an amusing contrast with the foot-shorter Mayor Bloomberg, with whom he enjoys a good relationship. He talks with a subtle Queens accent-he was raised in the Rockaways-and he rocks back and forth as he speaks.

He is a career transit professional, a veteran of the M.T.A., in fact, who worked as its chief financial officer in the 1990s, helping craft, among other efforts, the unlimited MetroCard, which he now wants to tweak. He was wooed away to London in 2000 for a top post at the tube, where perhaps his most visible contribution was the Oyster Card, a tap card that replaced tickets (a time-saving feature seemingly every large city now has except New York). And when the Paterson administration decided on a change at the top of the M.T.A. late last spring, officials reached out to Mr. Walder.

He is the first M.T.A. chairman in two decades who was not a campaign contributor to the sitting governor. Instead, he is simply a pure transit technocrat, one whose well-regarded analytical approach-a “performance indicators” report on the agency’s Web site shows month-by-month changes to things like on-time performance-speaks of his time at McKinsey.

Still, his tenure has been mostly devoted to dealing with surprise new budget gaps, installing major cuts that eliminated two subway lines and trying to find new efficiencies-tasks on which he has delivered some notable successes, such as a pledged savings of $40 million from negotiating better rates with contractors.

On the one hand, the fiscal situation and the lack of a reelection campaign for his boss this fall empowers Mr. Walder to slash and cut in ways that predecessors in his seat lacked-a big step for the agency.

On the other, he has to somehow keep the riding public from revolting as service diminishes and nice conveniences like station agents vanish. The carrot he’s offered, in a sense, is a big push on relatively low-cost measures that are highly visible, such as installing countdown clocks in stations and piloting an Oyster Card-like initiative that allows people at certain stations to tap a card over a reader rather than swipe a MetroCard.

“He’s made all the right moves so far,” said Lieutenant Governor Richard Ravitch, himself a former M.T.A. chairman. “I think his goal is to try to get through the next year, and see what happens to the economy, and what the new governor’s disposition is, and what happens to the fiscal situation.”


NOW, NEARLY A year in, on the cusp of a fare increase, much of Mr. Walder’s legacy is out of his hands, including, chiefly, how he will be received by the next governor. Mr. Walder has a six-year contract with an expensive clause if he is ousted, but governors often like to install their own M.T.A. chairs.

The presumptive governor, Attorney General Andrew Cuomo, has been noticeably silent on the M.T.A., at least so far. A lengthy campaign book only mentions the M.T.A. in passing, although future policy papers on specific items are expected. His office declined to comment on Mr. Walder.

Yet it’s difficult to understate the value to an M.T.A. chief of a strong governor in his or her corner, given the challenges ahead: The agency runs out of state funding for repairs and maintenance at the end of 2011, and it expects to develop a plan to presumably ask the Legislature to approve some sort of a new funding plan-likely a tough sell.

There is also the 2012 expiration of the transit workers contract; the union, thus far, enjoys a poor relationship with Mr. Walder.

At least in his rhetoric, Mr. Walder seems quixotic about the politics, acknowledging the standard process. “I, however, retain the view that our elected officials are going to recognize what the M.T.A. has done in a very difficult climate,” he said. “I think they will recognize what’s happened.”

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