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Building Congress paying MTA payroll tax despite being exempt

For the third consecutive year, the New York Building Congress is voluntarily paying the Metropolitan Transportation Authority Payroll Mobility Tax (PMT), which it had been exempted from as a result of New York State legislation passed in December 2011.

The PMT was originally approved by the State Legislature in 2009 to address chronic funding shortages at the MTA, which currently faces a $15 billion funding gap for its five-year, $32 billion capital program.

The tax, which was initially levied on all businesses and all other employers in the 12 New York counties served by the MTA, charges just 34 cents for every $100 of company payroll.

Ever since the tax was adopted, however, a small number of elected officials, mostly representing counties and towns served by the MTA outside of New York City, have fought to roll back the tax.

While attempts to abolish the PMT altogether through the court system ultimately failed, opponents did manage to enact State legislation in 2011 to exempt schools, non-profit organizations (including the Building Congress), and businesses with annual payrolls of less than $1.25 million, costing the MTA more than $300 million annually.

Despite the exemption, the Building Congress submitted a payment of $3,978 to the State’s Department of Taxation and Finance to cover the estimated amount it would have owed for the 2014 tax year.

Richard Anderson
Richard Anderson

“While our individual contribution obviously won’t make a dent in the context of the MTA’s $15 billion shortfall, we feel it is important to pay our fair share toward the maintenance and expansion of a transit network upon which our industry and the entire regional economy depends,” said Building Congress President Richard T. Anderson.

“Unfortunately, by exempting thousands of organizations that operate within the MTA’s territory from such a miniscule tax, the State Legislature is depriving the transit system of critical funding for the capital program. The Governor mercifully replaced some of this money with State funds. But, unlike the PMT, this money does not grow with the economy, can be taken away at any point during the budget process, and leaves the system in the exact same hole it started in.”

The MTA’s $32 billion capital program for 2015-2019 allocates $17.5 billion for capital improvements to New York City subways and buses, $3.1 billion for the Long Island Rail Road, $2.6 billion for Metro-North, and $3.1 billion for the MTA’s bridges and tunnels.

In addition to state-of-good-repair and ongoing expansion projects, the MTA’s current five-year program is notable for the investments that are being made to create a more resilient system in the wake of Superstorm Sandy.

Anderson concluded, “The ongoing maintenance and rebuilding of the region’s mass transit network is a collective responsibility. We hope all those who depend on a seamless, reliable and fully-integrated regional transportation network will recognize the enormity of the problem and lobby their elected representatives to reinstate the full PMT or find other, viable revenue sources that can help fill the MTA’s funding gap.

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