Transit officials and advocates on Thursday blasted a state judge's ruling that an MTA tax is unconstitutional, saying it could lead to "devastating" service cuts and "radical" fare hikes if it is not reversed.
MTA chief Joe Lhota called Judge R. Bruce Cozzens Jr.'s decision to strike down a payroll tax "flawed," saying he expected it to be overturned on appeal. But he warned that if the state's appeals court upheld the ruling, it could lead to an annual $1.8 billion hole -- a 15% reduction -- in the fiscally challenged agency's budget, requiring service cuts and larger than anticipated hikes.
On Wednesday, Cozzens said the Payroll Mobility Tax, which charges employers 34 cents for every $100 of payroll, was unconstitutional because it "does not serve a substantial state interest." He said state legislators should have gotten the OK of local municipalities to pass the law, or get two-thirds approval, which didn't happen.
On Thursday, Gov. Andrew Cuomo said, "we believe the ruling is wrong and we believe the ruling is going to be reversed."
The decision was received warmly by businesses in counties, towns and villages in suburbs outside of New York City, which had argued that they did not directly benefit from MTA services.