MTA warns proposed federal cuts could remove $250 million a year and jeopardize projects

# What happened

MTA Chair and CEO Janno Lieber warned the agency's board that pending Republican-led legislation would change how the Infrastructure Investment and Jobs Act (IIJA) is funded and would eliminate a category called advanced appropriations. That change, Lieber said, would reduce the MTA's federal formula funding by about $250 million a year.

A stopgap three-month extension that implements the same reductions went into effect Oct. 1 and will expire after the midterm elections on Dec. 11 unless Congress passes a different measure.

# How big the cuts are, locally and nationally

Locally, Lieber said the proposal "significantly" underfunds what the MTA historically received. The MTA currently receives less than 17% of federal formula transit funding, even though New York's transit system accounts for over 40% of national transit ridership.

Nationally, Lisa Daglian of the Permanent Citizens Advisory Committee to the MTA summarized the extension's impact: $4.2 billion in transit funding lost (about 20% nationwide) and roughly $12.9 billion in rail funding cut (about 81% nationwide). Daglian warned these reductions would reduce money available for accessibility and state-of-good-repair projects and could directly affect riders through worse service or canceled projects.

# What MTA officials are doing now

Lieber described an outreach campaign aimed at New York's congressional delegation and leadership in both houses to communicate the consequences for the MTA if the bill becomes permanent.

# Other federal pressure points the MTA flagged

Separately, Lieber and other senior officials told the board that the federal administration's tariff policies could add roughly $1 billion to the MTA's costs for new trains and buses. That potential added cost sits on top of the $23 billion the agency expects to spend on rolling stock in its current five-year capital plan.

Advocates and watchdogs have linked the IIJA extension's cuts to other federal proposals under discussion, such as the BUILD America 250 Act, which would make comparable funding reductions.

# What this would mean for riders and projects

According to Daglian, the immediate risk is a squeeze on capital investments: fewer funds for accessibility upgrades, state-of-good-repair work, and other projects that maintain or improve reliability. That can translate into degraded service over time and slowed or canceled capital projects that riders depend on.

# Where the process stands now

The short-term extension implementing the funding reductions is in effect as of Oct. 1 and runs until Dec. 11. The longer-term legislative package being floated in Congress would make these changes permanent unless lawmakers restore advanced appropriations or otherwise revise the formula.

# Bottom line

The MTA says it faces a potential annual loss of roughly $250 million in federal formula support if the proposed changes to IIJA funding become permanent. The agency is pursuing political channels to fight the proposal while warning that the cuts would affect capital investments and rider experience, and that tariffs could further raise procurement costs.