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Continuing this summer’s subway saga, Mayor de Blasio announced a plan on Sunday that would tax the wealthiest 1 percent of New Yorkers to fund the system’s much-need repairs and renovations. The proposal, which requires Albany’s approval, would also provide half-price MetroCards for low-income straphangers. As the New York Times reported, the “millionaires tax” would increase the tax rate of the city’s wealthiest residents to 4.4 percent from roughly 3.9 percent for married couples with incomes over $1 million and for individuals who make more than $500,000 annually.
De Blasio’s new tax would potentially generate between $700 and $800 million each year for the Metropolitan Transportation Authority, with more than $500 million allocated for capital costs for subways and buses and $250 million for the half-price MetroCard initiative. As many as 800,000 New Yorkers, those at or below the poverty level, are expected to qualify for half-price fares. According to the city, about 32,000 New York City tax filers would pay this tax, fewer than 1 percent of all tax filers.
In a statement, de Blasio said: “Rather than sending the bill to working families and subway and bus riders already feeling the pressure of rising fares and bad service, we are asking the wealthiest in our city to chip in a little extra to help move our transit system into the 21st century.”
The mayor’s proposal comes amid an ongoing dispute between de Blasio and Governor Cuomo over who actually bears responsibility for fixing the subway. While Cuomo oversees the MTA, he, along with the authority’s chairman Joe Lhota, has called on City Hall to fund half of the roughly $800 million short-term emergency plan for immediate repairs. Up until this week, de Blasio has maintained that the city, which contributed $2.5 billion to the MTA’s capital plan in 2015, would not provide any additional funding to the authority.
Any tax changes for city residents would require approval from state lawmakers, which would be difficult for de Blasio with a Republican-controlled Senate. Lhota, while happy the mayor finally agreed the MTA needs more money, responded to the mayor’s proposal in a statement. “There’s no question we need a long-term funding stream, but emergency train repairs can’t wait on what the State Legislature may or may not do next year.”
The mayor’s plan stipulates the state must pay $8 billion towards the MTA’s current capital plan with the additional $1 billion for the subway Cuomo committed earlier this summer. Plus, the new funding would be separate from the short-term rescue plan and city officials expect the state to return money to the MTA it had previously diverted elsewhere. According to the mayor, the MTA has not spent billions under its control and also said the state took $500 million from the authority’s budget to put into the state budget.
The Riders Alliance, a group that advocates for affordable transit options, said they’re on board with the mayor’s proposed tax in a statement: “A millionaires’ tax would require some New Yorkers to pay, but the status quo requires literally millions of New Yorkers to pay in the form of lost wages, missed work and days ruined by breakdowns and delays. It’s fair to ask the New Yorkers who benefit the most from our city’s prosperity to pay a little more to repair the infrastructure that the entire economy relies on.”
[Via NY Times]
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