In 2011, Nassau County Executive Edward Mangano sold a sweet deal: The county didn't need to pay the Metropolitan Transportation Authority the $35 million it was demanding to run Long Island Bus in 2012, or even the $9 million Nassau had been paying the MTA annually. Just $2.5 million from the county, to meet federal and state matching standards, would be enough, if Nassau could find a competent private bus operator. The wasteful MTA would be replaced by private-sector efficiency, Mangano argued.
Could privatization be that easy and profitable? Let's put up some "Sewers for lease" signs, quick.
But according to the county and officials at Veolia Transportation, the company that won the bid to run Nassau's buses, it became clear almost immediately after Veolia took over this year that the $106 million annual price tag -- the MTA had slated $142 million from all sources -- was impossibly low.
Within two months the county and company publicly announced $7 million in route and service cuts for the renamed Nassau Inter-County Express service. Meantime, the county quietly told Veolia to spend the $113 million it would take to maintain an acceptable level of service. What had been sold as a $106-million deal would have cost $120 million to provide, and even the reduced service will cost $113 million for the year.
Veolia has also had trouble serving disabled riders, but says new global positioning devices on all buses and a respite from its aggressive efficiency drive for Able Ride will help.
The Veolia takeover has produced good news, too. Accidents are down. Riders surveyed are happier with the equipment and drivers. Routes have been cut, but others improved. And even with $7 million in cuts, and expenses another $7 million higher than advertised, Veolia is providing service for at least $20 million less than the MTA said it would.
But where is this trend headed? NICE got the extra $7 million through larger-than-expected aid: $4 million more from the state than budgeted and $3 million more from the federal government. But the state money was part of a one-year deal to move cash away from the MTA and toward other public transportation; the New York City-centric Assembly balked at making the change permanent, so it can't be counted on for next year. And the $3 million extra from Washington also cannot be counted on to recur.
Mangano announced that extra $7 million last week. The legislature amended the NICE budget Monday. But NICE was spending at that rate, with the public none the wiser, for most of the year.
So, seven months in, the private takeover of Long Island Bus is cheaper, but not nearly as cheap as promised. With this much financial dancing in such a short period, it's impossible to guess how much NICE will cost in the future, or how much service will have to be cut.
Now, Mangano is pursuing a highly unusual $750-million quasi-privatization of the county's sewers. The control board overseeing Nassau's finances says it's a badly constructed loan in a lease's clothing. County legislators and taxpayers would be wise to keep in mind how complex the comparatively simple bus privatization is turning out to be as they mull this exponentially more radical sewer scenario.