By Edward Krudy
NEW YORK (Reuters) - New York's Metropolitan Transportation Authority passed a 5-year investment program with a $15.2 billion shortfall on Wednesday, and its chief executive said it may take years before the agency secures full funding.
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While the first few years of the $32 billion plan would be fully funded, it would cast doubt over out years at a time when the MTA is already facing the prospect of delays to existing projects and growing demands on its aging infrastructure.
The current five-year capital plan, which began in 2010, was only funded for the first two years before additional money was obtained, and chairman and chief executive Tom Prendergast said the 2015 to 2019 plan could follow a similar pattern.
"We need to keep the program going, so if that's the way it happens, fine. But we come back to the board, we're not going to make any revisions," Prendergast told the board.
The board's approval of the plan was the first step in a process that needs the agreement of a panel of state and city appointees. Prendergast said the agency would aggressively take the case for full funding to city and state officials, referring to the MTA as the steward of a $1 trillion asset vital to the success of the region.
Chief Financial Officer Robert Foran said it was too early to say how much of the $15.2 billion would be covered through borrowing, but added that funding the entire amount that way would increase the MTA's debt service costs by about $1 billion.
The agency currently spends about $2.4 billion servicing a $34 billion debt, Foran said. Debt service to operating expenses is about 17 percent, he added.
The current plan calls for issuing $3.9 billion of MTA bonds. It also envisions raising $530 million through securitizing $1.2 billion annually of a controversial payroll tax introduced in 2009.
As well as tapping the market to fund the hole in its capital plan, the MTA might tap state, city and federal funds for important infrastructure projects. It could also sell assets, Foran said.
The program envisions spending on investments for projects such as replacing subway, bus and commuter railroad fleets, and a major $10 billion project to enhance access to east Manhattan.
There is also a plan to extend the New Haven commuter line from Grand Central station in east Manhattan to Penn Station, improving access to the west of the borough that is less well served by public transport.
(Reporting by Edward Krudy; Editing by Andre Grenon)