MTA chief says payroll tax provides critical funding

Proposals to further rollback the payroll tax that helps support the Metropolitan Transportation Authority would take away needed money, the transit agency’s head told a Senate committee in Albany on Tuesday.

“The MTA will officially oppose any thing like that,” MTA chairman and chief executive Joseph Lhota said. “It’s a significant portion of our revenues. It’s very, very important that we have that.”

Lhota said the tax on employers in New York City and the suburban counties served by the MTA generates $1.5 billion annually. In December, state lawmakers partially repealed the tax, exempting small businesses and schools whose payrolls totaled less than $1.25 million.

On Monday, the Senate passed a bill that would eliminate the tax for libraries. Sen. Jack Martins (R-Mineola) said in a news release following its passage that the tax was “unfairly placed on our libraries, which serve as centers for our communities.”

The libraries together pay $1.3 million, a small amount relative to the total collected, but it’s money Lhota said the MTA couldn’t afford to lose.  

“$1.3 million is $1.3 million that I don’t have,” Lhota said. “We’d have to find ways to do further cuts and further reductions.”

Lhota said he’s willing to talk about alternative funding sources, but for now he said the payroll tax is “critical” for the authorities operations.