MTA Commuter Tax Pits New York City Against Suburbs

The 12-county downstate commuter tax is vilified by many living outside New York City - forced to pay a payroll tax to support transit that they may not use. They sued the MTA and won last August, but MTA had the ruling reversed on appeal on June 26.

2 minute read

June 30, 2013, 11:00 AM PDT

By Irvin Dawid


Benjamin Kabak describes the on-going saga (in Second Ave. Sagasfounded in 2006 to track the progress of Manhattan's long-awaited Second Ave. subway) of a vital revenue mechanism for the Metropolitan Transportation Authority that provides transit service - bus, subway, and commuter rail - for the five boroughs of NYC and seven surrounding suburban counties, including funds for the struggling Long Island Bus.

Round I (also reported here) went to Nassau County Executive Edward Mangano on August 22 with a ruling by a single N.Y. Supreme Court justice ruling that the payroll mobility tax (also referred to as the commuter tax) was unconstitutional. On June 26, a four-judge panel of the Appellate Division overturned that ruling, allowing the MTA to continue to collect the vital tax that had been authorized by the state legislature in 2009, accounting for 12% of its annual budget

The PMT, a 34-cent tax on every $100 of payroll paid by public and private employers in the 12-county MTA region, generates $1.2 billion annually. (Streetsblog, 2012)

Kabak questions the wisdom of using the courts to strike down the tax, offering an alternative venue for such efforts. 

In Albany, efforts to repeal or pare down the payroll tax will continue, but that’s the right approach. A legislative response is now required, and the payroll tax, imperfect but necessary, lives on as a permissible, constitutional exercise of legislative power that clearly serves a substantial state interest.

On June 28, Kabak writes that "Nassau County isn’t giving up. The Long Island plaintiffs will appeal this week’s decision to the Court of Appeals, the highest state court in New York’s judiciary system, Newsday reported today.

Kabak adds that "it seems that Nassau County Executive Edward Mangano is content to spend more taxpayer dollars pursuing a lawsuit he has no chance of winning." Without commenting on his chance of winning, we noted here that while Nassau may be a wealthy county, under Mangano's leadership the county found itself in dire financial straights just two years ago.

From the suburbs north of NYC, Mid-Hudson News Network writes "several upstate municipalities and the Orange County Chamber of Commerce were among those joining the Nassau County lawsuit challenging the tax. Nassau paid all of the legal fees."  

Orange chamber President John D’Ambrosio said he is disappointed with the ruling but is not giving up the fight to have the tax revoked. He said the business community will continue to lobby state lawmakers in Albany to eliminate it.

To sum up, Round I went to the suburbs; Round II went to MTA, and Round III just began. Stay tuned.

Thursday, June 27, 2013 in Second Ave. Sagas

View of Mount Hood at golden hour with Happy Valley, Oregon homes in foreground.

Clackamas County Votes to Allow ADUs, Residential RVs

County officials hope the zoning changes will help boost the housing supply in the region.

June 18, 2024 - Mountain Times

Single-family homes in a suburban neighborhood in Florida.

New Florida Law Curbs HOA Power

The legislation seeks to cut down on ‘absurd’ citations for low-level violations.

June 16, 2024 - The Guardian

Aerial view of intersection in New York City with yellow cabs and zebra crosswalks.

Planners’ Complicity in Excessive Traffic Deaths

Professor Wes Marshall’s provocatively-titled new book, "Killed by a Traffic Engineer," has stimulated fierce debates. Are his criticisms justified? Let’s examine the degree that traffic engineers contribute to avoidable traffic deaths.

June 13, 2024 - Todd Litman

View of Palos Verdes Drive along Pacific Ocean in Palos Verdes, California at sunset.

Erosion Threatens SoCal Road, Lloyd Wright Icon

The city of Palos Verdes is closing parts of a roadway to cyclists, citing safety concerns as the land underneath moves between 7 and 12 inches per week.

June 23 - Daily Breeze

Faded image of vacant storefront in rural area with American flag stars painteind on windows.

COVID Isn’t to Blame for the Retail Vacancy Crisis

A drop in demand for retail space began well before the seismic shifts of the pandemic.

June 23 - Slate

Heavy New York City traffic headed toward Holland Tunnel in Manhattan.

Judge Rules in Favor of MTA in Congestion Pricing Suit

Advocates of the program are calling on Gov. Hochul to reinstate the program in light of the decision.

June 23 - StreetsBlog NYC

City Planner I

Department of Housing and Community Development

City Planner II

Department of Housing and Community Development

City Planner Supervisor

Department of Housing and Community Development

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.