Levy: MTA payroll tax unfair to Suffolk

Suffolk County should not be forced to pay $253 million in taxes to the MTA at the same time as the transit agency cuts service to the East End and Long Island Rail Road employees abuse their benefits, County Executive Steve Levy said Friday.

At a Hauppauge news conference, Levy called upon state legislators to repeal an onerous Metropolitan Transportation Authority payroll tax, and for federal lawmakers to overhaul the pension system that has allowed nearly all LIRR retirees to collect disability payments in recent years.

"We're being taxed for a service we hardly use, and being taxed to the gills," said Levy, who is running for governor.

The payroll tax, enacted last year to plug a $1.8-billion MTA budget gap, charges employers in the 12-county MTA service area 34 cents on each $100 of payroll.

Levy said the tax is particularly unfair to residents of Suffolk, which gets no bus service from the MTA and scarce railroad service in much of the county.

Levy noted that the LIRR plans to eliminate some service between Ronkonkoma and Greenport and that there is no "evidence that our service is going to be improving in the future.

MTA spokesman Jeremy Soffin declined to comment Friday, but LIRR president Helena Williams said earlier this week that a plan to spend $80 million on new, light diesel trains will benefit customers in Suffolk and lead to increased service in the county.

Levy also took aim Friday at the unusually high rate of LIRR employees collecting federal disability benefits. The U.S. Railroad Retirement Board, which administers the disability program, remains under investigation by several agencies for approving nearly all disability applications by LIRR employees.

Levy called it an "absolutely corrupt" system and urged federal lawmakers from Long Island to put an end to abuses.

In 2008, Sen. Charles Schumer and other federal lawmakers brokered a deal with the retirement board to firm up standards for LIRR employees applying for disability. A Government Accountability Office investigation last year found that little had changed since the new standards were enacted.