The Metropolitan Transportation Authority (MTA) is facing ongoing financial uncertainty, despite improvements in its fiscal outlook, according to State Comptroller Thomas P. DiNapoli’s latest annual review. The authority’s stability depends on its ability to reduce costs, increase ridership, and efficiently manage capital projects, as federal funding uncertainties continue to threaten future investments.
“The MTA’s budget is currently balanced, but outyear gaps persist as the Authority faces substantial fiscal uncertainties, led by funding threats from the federal government,” DiNapoli said. “It’s imperative that the MTA stay focused on improving the system and bringing riders back, which is one of the surest ways it can help stabilize its fiscal outlook at the farebox, and by following through on its savings initiatives.”
Although the MTA has managed to narrow projected budget gaps, it still anticipates deficits of $345 million in 2027, $354 million in 2028, and $428 million in 2029. The authority relies on certain revenue streams outside its control, such as reimbursements from the Federal Emergency Management Agency (FEMA) for Covid-related expenses and casino licensing revenue. Delays or reductions in these sources could result in an $800 million budget gap in 2026. FEMA recently postponed reimbursements for Covid expenses for the 2025 federal fiscal year and indicated it may cancel these funds entirely, which would create a $300 million gap this year.
The MTA has more direct control over farebox revenue and cost-saving initiatives. According to the July Plan, fares and tolls are expected to generate $205 million more than previously forecast over four years. The plan also delays a fare and toll increase to January 2026. The authority is working to achieve $500 million in annual savings, but must reach this goal to maintain budget balance. Paratransit costs, which have risen in recent years, are identified as a potential area for further savings.
DiNapoli has urged the MTA to clarify its capital project priorities in light of uncertain federal support and the need to accelerate financing for its $68.4 billion 2025-2029 capital program. Through the first eight months of 2025, the MTA committed $9 billion to capital needs, with $6 billion allocated to major projects such as rolling stock purchases and the Second Avenue Subway extension. The authority is on track to meet its $12.6 billion commitment goal for the year.
Potential cuts to federal transit formula funding could leave a $4 billion shortfall in the MTA’s capital budget. Nearly $7 billion in federal funding for the Second Avenue Subway Phase 2 is also under review, though it is covered by an existing grant agreement. Legal challenges over congestion pricing, which is expected to provide $15 billion for the MTA’s 2020-2024 capital program, add further uncertainty.
If federal or congestion pricing funds are reduced or lost, the MTA may have to take on more debt, find efficiencies in capital projects, or delay or cancel planned work. While the authority has recently worked to lessen the impact of debt on its operating budget by leveraging capital lockbox funds, this progress could be reversed if new borrowing is required.
System ridership in 2024 was at 68% of 2019 levels. However, paid subway ridership exceeded projections, reaching 76% of pre-pandemic levels in July 2025—higher than the expected 73% for that month. Increased perceptions of safety may have contributed; in June 2025, 75% of riders reported feeling safe on trains and in stations, compared to just 45% in March 2024.
The MTA projects that subway ridership will gradually return to 77% of pre-pandemic levels by 2029, though recovery varies by neighborhood, with some areas lagging behind. The Comptroller provides station-by-station ridership data on his Subway Ridership Dashboard.
Bus ridership has recovered more slowly, with paid ridership at 68% of 2019 levels in July, up from 60% in September 2023. The MTA has made progress reducing fare evasion on buses, but it remains a significant issue for revenue.
Commuter rail lines are seeing faster recovery, with Long Island Rail Road expected to reach 90% and Metro-North Railroad 83% of pre-pandemic ridership in 2025.
For more information, readers can access the Comptroller’s reports on the Financial Outlook for the Metropolitan Transportation Authority, the Subway Ridership Dashboard, trends in subway delays, and updates on MTA debt.
