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How the MTA Stole Millions from Tram Riders

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Did you know that the MTA stole millions from Roosevelt Island Tram riders? Thefts started in 2010. It was New York State government bungling at its worst. Stories last week covering RIOC’s clownish mishandling of the new OMNY system touched on the scam, but it’s time for a closer look.

by David Stone

The Roosevelt Island Daily News

The MTA stole millions for over a decade

On a sunny winter day, the Roosevelt Island Tram descends. The MTA stole millions from riders, starting in 2010.

When the Roosevelt Island Tram joined the MetroCard system in 2004, the fare was $2.00 per ride. Residents ditched their historic Tram tokens – each had a distinctive hole in the middle – when MetroCard became the only gate opener.

Roosevelt Island Tram in View

Locals were thrilled. Led by Matthew Katz, the Residents Association pushed for it for years. An additional shove by activist City Council Member Jessica Lappin got it over the top. With MetroCard readers installed, riders transferred freely between MTA buses and subways, relieved of the burden of extra fares.

Although RIOC seemed, more or less, lost in the shuffle, having added little muscle to the efforts, a contract with the larger agency was necessary. That agreement resolved revenue sharing as passengers transferring between buses, subways and the Tram no longer paid a second time.

All well and good, but something got left out. Whoever negotiated on behalf of Roosevelt Islanders muffed a crucial element: there is no escalation clause. RIOC’s share was set in legal concrete at two bucks. They’ve known about this for a long time and there was ample time for hammering out a fix, but RIOC, not surprisingly, sat on its hands. As a result, the MTA legally stole millions from Roosevelt Island.

What happened?

In 2010, fares throughout the city’s MetroCard system went up to $2.25, including the Tram. But because there was no escalation clause in the contract, the MTA kept 100% of the increase. That’s when the local community got gypped for the first time.

The MTA upped the thievery in 2013 and 2015 when fares jumped to $2.50 and $2.75 respectively. Losses to Roosevelt Island went into the millions. And it continues every time you swipe $2.75 into the Tram’s MetroCard readers. We’re treading 2004 water. We get $2.00, and the MTA skims the rest.

Not only is RIOC feeble in its whiney attempts to get the money, the MTA is more than deaf enough in ignoring them. Even if we finally get an update, years of legal thefts will be ignored.

Understanding why this matters requires an appreciation of Roosevelt Island’s unique form of governance. It’s undemocratic and plagued with expensive incompetence, but neither is the point. The point is that RIOC is primarily funded by residents via the hidden RIOC Tax.

That little kink in the universe makes the community very likely the highest taxed in America, hit for federal, state, city and RIOC taxes.

The result: When the MTA steals millions from RIOC, it forces the community to pick up the shortfall.

Tangible results from the MTA stealing millions

No question, RIOC is a bloated giant squatting on a little, disempowered Island, but take a single example. Each year, the ballooning state agency grudgingly gives up $150,000 in Public Purpose Grants supporting local nonprofits. (Legally, they can give out around $1 million.) Yet, since 2015, they’ve let the MTA keep an unearned million or more without serious protest.

In reality, it may be that patronage and favoritism has so encumbered RIOC with ineptitude that it can’t act effectively as an advocate. And maybe, without ever having to stand for a vote, the execs simply lack the cojones for doing the right thing.

But what we can surmise, honestly, is that a change is needed, starting with recouping the millions the MTA stole from Roosevelt Island. That money should be gifted to our starved nonprofits without RIOC stuffing is pockets. If RIOC President/CYA Shelton Haynes and company can’t rally for something so obvious, as it appears, the bumblers ought to go and stay gone.

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