Wednesday, September 18, 2013

An MTA Senior Director talks to us about his daily subway commute... and the MTA's debt crisis

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If you're an NYU alum, then it's very likely that you have used the NYC subway system. The subway is an invaluable and inexpensive way to get from point A to point B. Whether you're going from Brooklyn to the Bronx, or from West 4th to Penn Station, the subway is always an option. Love it or hate it, it's integral to every day life in NYC. And to a certain extent, it's an influence on, and extension of, city culture.

Bill Ciaccio (WSC '77) has been an MTA employee since 1979. Currently, he serves as a senior director in operations and handles about 5 billion dollars of infrastructure projects each year.

Over the past three decades, he followed his passion for mass transit and built a successful career with the MTA. We had the pleasure of speaking with Bill about a lot of different things, including his time at NYU, things we've seen in the NYC subways, and the MTA's current debt crisis.

*In the comments section, feel free to share your opinions. We'd like to hear from you, whether you have thoughts on the MTA's financial issues or just an interesting NYC subway story!*

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What do you remember most about your time at NYU?

I think at NYU it was the friendships I made. I graduated in 1977 and was very active in a lot of organizations. I was president of the Newman Club, I was President of the senior class, President of Pre-Law, and I made a lot of really close friends who I am still quite close with after forty years. Even some professors.

NYU also helped me develop a lot of my talents in managing groups and organizations.



So you started with the MTA just two years after graduating from NYU?

Correct. I graduated from NYU in 1977, I got an MPA from Columbia University, and then I started with the MTA in 1979. 

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How did you first get involved? 

I always had an interest in transportation. I started working here in the procurement area, which was interesting. I came in basically as a procurement analyst and became a section head within two years. When I left that area, I jumped around departments for a number of years. In the 80’s I started working in the Capital Program Management department. I was in charge of facilities, I was in charge of graphics, and then, since 1988, I’ve been working in some capacity of operations. 

Currently I have a senior director title and I am responsible for all the infrastructure projects, all the Hurricane Sandy projects. You may already know that after Hurricane Sandy, the MTA received several million dollars to do some remediation work—Hurricane Sandy projects. But besides that, there’s a lot of infrastructure work. So I’m in charge of all the budgeting and financial administration. We handle about 5 billion dollars in infrastructure projects per year. 

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What do you do on a day to day basis?

My job is kind of like jack of all trades. I put out fires. Day to day I’m basically handling a staff of about 20 people directly, and indirectly I’m responsible for about 400 people. I manage the staff, I manage special presentations for the board or to politicians, we make sure all the routine work is done. For example, right now I’m working on project status reports which are done every month and track individual projects and schedule issues, and we have about 200 of them. First it’s completed by the project managers, then it goes to my staff to review it, and then it comes to me to approve everything. But I like to review everything pretty closely, so it takes some time. Also, a lot of personnel issues come to my desk. A lot of everything comes to my desk.

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What lessons did the MTA learn from Sandy and Irene?

Well, as you know, with Irene we did stop service. We were quite lucky with Irene. We just missed everything being flooded by about three inches. Literally, we were about three inches away from what happened in Sandy. 

What happened with Sandy is that we did get reports of a major hurricane on its way, we did stop all service, we moved all our rolling stock to high ground so it wouldn’t get flooded. For instance, if you’re aware of what happened with New Jersey Transit, they moved all their rolling stock to an area that got flooded, so there was a lot of damage to their train cars. But we were in a situation where we were able to get things running fairly quickly. I mean, the damage was much worse than we ever anticipated. All the subway tunnels were flooded, and of course we lost power in Manhattan, which didn’t help. 

And as a person who lives in lower Manhattan, I particularly didn’t like it either! Our office here at 2 Broadway, which is our central office, was flooded. We put sandbags in front of the building which faces Battery Park and Ellis Island. Behind us, of course, we didn’t anticipate flooding, and the water did come from behind and flooded the basement area. Our building was out of service for about two weeks. We put our command center in the Law Library. We were literally sitting in the library with our cell phones and laptops trying to figure things out, which was interesting. It was quite an interesting two weeks sitting on those wooden benches in the Law Library. That was our command center. 

But anyway, lessons learned. We did receive money from Hurricane Sandy, so we’re using that to harden our facilities even further and prevent more flooding. We have about 2 billion dollars invested in projects that will protect from future flooding.

How often do you ride the subway?

Every day. I ride the subway every day. I commute to work every day, and occasionally I’ll go see projects that are going on. So at least twice a day or more. I’m a strong believer in the subway system, I’ve been riding it every day since 1973 pretty much. 

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Wow. After all that time, what’s the most surprising thing you’ve seen on the subway? 

Well, I hate to be cynical at this stage of the game, nothing surprises me anymore! I mean, we’ve had all sorts of issues, especially in the 70’s and 80’s. We’ve had homeless people living in the subway. We’ve had homeless people literally running electrical lines in and setting up little houses in some of the abandoned tunnels. I mean, when you’re carrying so many people every day, things are bound to happen. 

My view is that I try to be a good Samaritan. I work at 2 Broadway which is Bowling Green, the stop that is the Statue of Liberty. And I look around and see these tourists all the time with dazed expressions over their eyes, they’re looking at maps but you can tell they’re lost. So I explain, ok, this is where we are, you get out here, and this is where the Statue of Liberty is. I just figure we have to do little things to make NYC a little more tourist-friendly. Give them a good impression. So that’s my little thing that I do. Usually once a week, maybe more, when I see tourists with that befouled expression in their eyes.  

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Is there anything you’ve learned about the culture of New York by being on the subway so often?

Well, I was born in NYC, I was raised in NYC, I went to school in NYC, and I’ve lived here pretty much my whole life. But I look at NYC like a microcosm of the city. You have the homeless, occasionally, but not as much as there used to be. You have the panhandlers, you have the musicians. You have the beggars, of course, which is always interesting when you see someone begging, and then once in a while I’ve seen them screaming at each other, “Hey, I saw you on the other line and you just made up a different story!” I mean, the system, as I said, has improved dramatically over the years. When I first took it there was no air conditioning. So you can imagine what it was like down there in the hot days. it was like going to Hell! And now of course we have buses air conditioned, subway cars air conditioned, even some of the stations are semi-air conditioned. 

So I would say, in terms of the microcosm, since I was taking trains in the 1970’s—fires, chaos, insanity—if you look at it in terms of how it’s improved, I’d say it’s similar to New York. In the 80’s the city started to improve, and especially in the 90’s and the 00’s. And the system has dramatically improved. The danger level in the subway has gone down dramatically from when I was riding in the 70’s till now. It’s a pretty safe, secure place, like the city is a pretty safe and secure. It’s not a bad way of commuting. I take relatives coming from out of town, and they seem to like the system. And they like the city. So in a way, I’d say the system reflects the city. The city has become a much, much better place to live in the last three decades, and the transit system has also become a better place.

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Over the time you've been at the MTA, has anything changed about the way decisions are made— concerning new lines being built, safety, customer service…

Well when I first started, the transit system was in terrible, terrible shape. You probably don’t remember but subway cars were literally going on fire all the time, there were derailments all the time. Money was not poured into the system—we were starved of all our funds. So it was in horrible, terrible shape. We’re talking about a system that was starved for money, that the politicians basically abandoned. There were basically just a lot of issues here that the higher leadership didn’t give a damn about. 

I’d say it started changing in the early 80’s when David Gunn came in as President. And what he did was push through the MTA’s first capital program. The MTA has been dealing with a 5 year capital program, which is basically where our funding is. It varied from program to program, but there were all these multi-billion dollar capital programs. The money started pouring into the system in the ‘80’s, and slowly but surely things were refurbished. Things were redone—new subway cars, new infrastructure work, new busses. We poured a lot of money into the system, and the system has dramatically improved. 

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What is the difference between the MTA of the 80's and today's MTA? 

The difference between now and the 80’s, 90’s and even the early ‘00’s is that we had dedicated funding from the state, but under Pataki that funding was basically taken away. So we started borrowing money for the capital programs. The programs are basically no longer funded by aid. I mean, we do get some tax revenues and money from the fares—but most of the money right now is borrowed money. 

Unfortunately right now we have something around 45 billion dollars of debt. We’re the third most heavily indebted organization in the United States. I think first is California, then New York State, and MTA is number three. I think our interest payments alone are about 2 million dollars per year. That’s interest payments alone from the money we’ve been borrowing. 

We used to get dedicated 5 year plans, but the last few years have basically been much more uncertain than in the past. We used to have people that were here for a long time, you know, chairmen who were here for a long time, and in the last few years, as you know, we’ve had rotating chairmen.

Over the past few years I’d say the problems we’ve encountered are, number one, severe financial problems in terms of borrowing and no guaranteed source of funding. And number two, changes in executive leadership. For instance, one president comes in and has certain objectives and things he wants to push, and a new president comes in and changes everything. That’s been an issue for the last few years with us.

On the other hand, we have responded wonderfully to crises. For instance, with Hurricane Sandy, we got up and running fairly quickly.  

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Looking into the future, do you see the MTA’s debt as the biggest challenge you will face over the next ten years?

Yes, I think it’s definitely going to be a major problem. The interest just a couple years ago was about a billion, now we’re up to two. In the next three or four years I think it’ll go up to three billion dollars. Yes I see the financial situation, unless we get a dedicated source of funding and we do not rely on borrowing, it’s going to be a major, major problem. Interest rates are going to continue to go up. 

Our wages have not gone up. We’ve basically been in a wage freeze. Management hasn’t had a raise since January 1st, 2008. And the union people haven’t had an increase here either. They’ve been working without a contract for a number of years. So wages have been frozen, but the problem is that we have increased borrowing costs. So I do see the biggest problem for the agency as the continuing increase in interest rates and payments that will just get higher and higher every year.

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Are there any talks about possible ways to overcome or deal with the debt?

No. To be honest, no. There aren’t. I don’t know if you’ve been following all the battles with the capital program up in Albany, but there have been ideas about ways of getting dedicated core savings—they had a commuter tax for instance that was abolished up in Albany. No, there’s no real long term planning right now. They figure the next governor will handle that one.  

And how do you think that could affect the MTA in the next decade or so?

Well if the amount of money we’re paying in interest goes up, we could be paying up to three or four billion dollars a year just in interest payments alone. And obviously, if we’re paying that much money, the work that we do is going to be curtailed to some extent. The number of projects we do, repairs, rehabilitation—it will all be impacted if we continue to pay more and more in interest debt.

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One more question. The subway is full of people who show off interesting talents in exchange for your generosity, and New Yorkers tend to have pretty strong opinions about whether to oblige. Even though it’s technically illegal, have you ever given your spare change to a subway performer?

Honestly, no. We do know that a lot of them are fakes. Some of them amuse me. Some of the musicians amuse me over the years, and some of the acrobatic shows are interesting. But I typically don’t. I figure there are plenty of tourists who give them money. 

Do you have anything else to add about anything we've talked about?

The only thing I would say is that NYU did prove good training grounds for me in terms of developing talents and friendships, leadership ability, management ability. What I developed in the clubs and organizations that I was actually running proved to be a very good training ground for the future. And friendships developed my ability to meet people, deal with all types of people from politicians to track workers. So it was a very good training ground for me in many ways, my four years at NYU.

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