MTA 2018 BUDGET AND FINANCIAL PLAN ADOPTION MATERIALS

Transcription

1 MTA 2018 BUDGET AND FINANCIAL PLAN ADOPTION MATERIALS MTA Finance Committee December 11, 2017 MTA Board December 13, 2017

2 MTA 2018 Budget and Financial Plan Adoption Materials Table of Contents I. Staff Summary MTA Consolidated 2018 Budget and Financial Plan.. I-1 II. Agencies Staff Summaries 2018 Budget and Financial Plan: Bridges and Tunnels II-1 Capital Construction Company..... II-13 Long Island Rail Road... II-19 Metro-North Railroad... II-31 MTA Headquarters... II-43 Inspector General... II-55 First Mutual Transportation Assurance Co. (FMTAC)... II-61 New York City Transit.. II-65 MTA Bus Company... II-77 Staten Island Railway... II-89

3 l. Staff Summary MTA Consolidated 2018 Budget and Financial Plan

4 Staff Summary Revised: Metrcpolltan Transportatlon Authorlty Page I of7 Subject MTA 2018 Budset and Financial Plan Department Chief Financial Officer Department Head Name Robert E. Foran Signature Project Manager/Dlvision las F. Johnson Board Actlon Order To Date Approval lnfo Other 1 Finance Comm. 12t11 2 Board 12t13 Date December 11,2017 Vendor Name Contract Number Gontract Manager Name Table of Gontents Ref # lnternal Approvals Order Aooroval Order Approval.- 1 leoal Hf ^ / 2 Chief ot Staff lvlz 3 Manaoino Directo(l Purpose: To secure MTA Board (i) adoption of the accompanying 2018 Final Proposed Budget and the Four-Year Financial Plan ("November Plan" or "Plan"), which includes approving the 2017 Final Estimate and Plan Adjustments (items below the baseline), and (ii) authorization of Budget and Plan adjustments, including MTA efficiency targets and policy actions, as set forth below in this Staff Summary, Discussion: This document summarizes the November Plan presented to the Board for information purposes at the November Board meeting, which projects ending cash balances of $78 million in 2017, $30 million in 2018, and $69 million in2019 with projected cash deficits of $352 million in2020 and $643 million in2021(see attachment A). Since 2010, MTA financial plans - which are developed in a disciplined, consistent, and transparent process - have included the impact of our continuous pursuit of operational efficiencies and recurring cost reductions which are used to temper the amount of revenues needed from biennial fare and toll increases and governmental subsidies and provide funding for the capital program and enhanced maintenance. The Plans have added service when sustainable while also addressing long{erm costs such as pensions, health care, paratransit, and debt service previously considered "uncontrollable." The November Plan captures the major assumpt ons that were first identified in the July Plan. lt is updated to reflect stakeholder input and the impact of new developments and risks. lt includes a revised current year forecast and finalization of the proposed budget for the upcoming year along with projections for the three outyears. The July Plan was based on three key inter-related elements: (i) fare and toll price increases ol 4o/o in 2019 and 2021; (ii) annually recurring cost reduction cost containment targets that will increase the level of annual savings to $2.3 billion peryear by 2021; and (iii) supportfor $100 million in additionalfunding needed forthe amended Capital Program. The July Plan also funded important new investments over the plan period including $484 million for im proved maintenance/operations and customer experience enhancements. I-1

5 Staff Summary Page 2 of 7 The July Plan included certain MTA actions to address unfavorable changes from the February Plan, most notably a significant reduction in real estate transaction revenue, which remain in the November Plan assumptions: Increased savings targets by $150 million per year, starting in 2018 with an incremental increase of $50 million per year thereafter, growing to $300 million in 2021; Restoration of PMT Replacement Funds to $307 million a year ($65 million per year); Suspended contributions to the B&T Necessary Reconstruction Reserve Fund from ($214 million ) instead of PAYGO; Use of $135 million of the $155 million in the 2017 General Reserve; and Suspended planned contributions to the GASB 45 OPEB reserves, set aside to fund Other Post- Employment Benefits (principally, retiree healthcare costs), beginning in 2018 ($101 million). The July Plan was balanced through 2019 with funding gaps of $112 million in 2020 and $493 million in Changes from the July Plan There have been revenue and expense re-estimates and other changes since the July Plan: Changes and re-estimates worsening financial results over the Plan period: Lower farebox/toll revenue estimates ($281 million) Lower real estate transaction forecasts ($147 million) Lower advertising revenue ($143 million) Lower MMTOA receipts ($80 million) Changes and re-estimates improving financial results over the Plan period: Lower debt service costs ($189 million) In total, changes and re-estimates, including the above, are $309 million unfavorable for the plan period. Highlights of the November Plan The November Plan continues to follow the approach reflected in earlier plans and contains many noteworthy items: Subway Action Plan (SAP). This $1.5 billion investment over the Plan period will target the key drivers of 79 percent of the major incidents that cause service delays, including signals, track and power issues. It also addresses water-related damage and corrosion, track fires, car breakdowns, police activity and station issues. The investment funds the following core areas: track/infrastructure, signals, power, fleet, stations and communications. The Subway Action Plan will jump start improvements over the next 14 months, then maintain this level of effort going forward. Using existing reserves and available cash, the MTA will provide the initial operating and capital cash-flow funding of this work with the expectation of full reimbursement in The Governor has committed to funding one half of the costs of this program. If new funding commitment for the remaining cost of the program is not forthcoming, the SAP will be scaled back to a sustainable level and the February Plan will be adjusted. The 2018 operating costs are reflected in the proposed 2018 budget. All capital costs are being presented in a proposed amendment to the Capital Plan. I-2

6 Staff Summary Page 3 of 7 Hold projected fare/toll increases to 4% in 2019 and The Plan continues to project 4% biennial fare/toll increases (the equivalent of 2% per year) which is lower than the projected two-year inflation rates of 5.5% and 5.3% in 2019 and 2021, respectively. Consistent with recent Plans, a March 1 st implementation is assumed for both the 2019 and 2021 increases. The annualized yield of these increases is projected to be $321 million and $336 million, respectively. Increase annually recurring savings targets. The Plan maintains the annual savings targets proposed in February and July ($200 million in 2018, $250 million in 2019, $300 million in 2020 and $350 million in 2021). While these aggressive targets will be harder to achieve, the MTA remains committed to meeting them. Some $593 million in savings have been implemented or identified in the July and November Plans. The July Plan captured $509 million of savings in areas including: health & welfare, headcount efficiencies, Enterprise Asset Management (EAM) program, paratransit, maintenance, and Information Technology (IT). The November Plan identifies $84 million in savings that include reduced prescription benefit costs at NYCT and operational efficiencies at B&T. Since 2010, the MTA has implemented initiatives with annualized savings of $1.9 billion. These programs, when combined with the additional targets from February and July will result in annual savings of $2.3 billion by Other MTA Actions As previously described, the July Plan was balanced in part by using $135 million from its $155 million General Reserve and by suspending planned funding to certain reserve accounts. In addition, the July Plan assumed the restoration of PMT Replacement Funds from NYS of $307 million ($65 million per year). This Plan retains all of those assumptions. In addition, it assumes that the $149 million GASB 45 OPEB Reserve and the remaining $20 million from the 2017 General Reserve used to advance the funding of the SAP in 2017 and early 2018 will be reimbursed by the State and other funding sponsors and then used to offset operating expenses in The Bottom Line Combined, the above noted changes and re-estimates and recommendations result in a net worsening to MTA s financial forecast over the plan period. As detailed in the following chart, this Plan is balanced through 2019; however, July projected gaps for 2020 and 2021 of $112 million and $362 million are increasing to $352 million and $643 million, respectively. Challenges Going Forward There are many challenges and risks ahead: Secure full funding for the Subway Action Plan. The implementation of the SAP will provide critical and measurable improvements to the performance of our subway system and in the quality of service provided to our customers. As previously mentioned, the MTA has received a commitment from the Governor that the State will fund half of the SAP s cost. If an additional funding commitment is not forthcoming, the SAP will be adjusted commensurate with available funding and the February Plan will be adjusted. Secure new sustainable funding for operations and capital. The plan assumes aggressive cost-cutting yet is still projecting significant out-year gaps. In order to sustain operations and protect investments made to date and/or planned, the MTA will almost certainly require a new source of future funding to support its operating and capital budgets. I-3

7 Staff Summary Page 4 of 7 Biennial fare and toll increases. While we work diligently to control costs, the reality is that combined fares and tolls only cover approximately half of operating costs ( Farebox Operating Ratio ) and a little more than a third of total costs, including capital costs ( Farebox Recovery Ratio ). Moreover, many costs are dependent on pricing factors beyond our direct control (e.g., energy, health & welfare and pensions). If projected fare and toll increases are not implemented, our financial situation will quickly deteriorate as revenue will not be able to keep pace with inflation and other cost growth. Achieve cost reduction targets. Efforts to reduce costs will continue, but it becomes increasingly challenging as much of the low hanging fruit has been harvested. Unidentified savings targets are $214 million in 2018, $309 million in 2019, $388 million in 2020, and $418 million in We recognize that these targets are aggressive and will be harder to achieve, but we are committed to meeting these goals. If we do not achieve our targets, operating gaps will occur earlier and be larger. We must also remain focused on existing cost control efforts to avoid backsliding, as we cannot afford to give back any of the savings that we have worked so hard to achieve to date. Increased investments in maintenance/operations and customer experience enhancements. Our challenge is to continue maintaining and improving our operations, even as growing ridership puts more demands on our aging infrastructure, including our 113-year old subway system. We need to find more efficient ways to improve our System, move our customers, and enhance their experience. General economic conditions. The finances of the MTA are highly influenced by economic factors. Passenger and toll revenues, dedicated taxes and subsidies (including real estate transaction tax revenue), debt service, pensions and energy costs are all impacted by the health of the economy. If the economic assumptions reflected in the Plan are not realized, the November Plan projected results could be adversely affected. Potentially higher interest rates greater than forecast. The November Financial Plan includes interest rate assumptions in line with the Federal Open Markets Committee s recent actions and policy statements on future actions. Changes in economic activity may result in increases of the federal funds rate, which in turn could lead to an increase in bond rates greater than projected in the Plan and ultimately increase our debt service costs. I-4

8 Staff Summary Page 5 of 7 Recommendation: It is recommended that the Board: Adopt the 2018 Final Proposed Budget and Four-Year Financial Plan (November Plan), which includes approving the 2017 Final Estimate and Plan Adjustments (items below the baseline). The approval of this Plan will supersede prior Board Plan approvals for this period. Note that the projected 2019 and 2021 fare/toll increase proposals will require separate Board action in advance of those dates. Authorize staff, under the guidance and direction of the Chairman, Managing Director, and Chief Financial Officer or their designees to take actions to implement the policy actions set forth in the Plan. Policy actions include the full funding of the Subway Action Plan. The Plan assumes NYS funding for half of the costs of the SAP, including debt service. The Plan assumes a new source of funding for the other half of the SAP cost. The Plan also includes the reimbursement of MTA s advance funding of SAP costs in 2017 and early 2018 (see below), and the operating budget will temporarily fund 2017 capital costs that are expected to be paid back from the Capital Program in The Plan assumes that if new funding commitments are not forthcoming, the SAP will be scaled back to a sustainable level. Recommend necessary changes to the scope of the Subway Action Plan in the February Plan to match available funding, as well as authorization to make corresponding changes to the Budget. Authorize staff to draw down the unexpended 2017 general reserve ($155 million). The July Plan assumed the drawdown of $135 million; the remaining $20 million will be used to provide advance cashflow funding of the Subway Action Plan (SAP) in The $20 million is assumed to be restored in 2018 upon the reimbursement from NYS and a new funding source, and will roll into the 2018 cash balance. Authorize staff to draw down $80 million of GASB 45 OPEB Reserves to provide advance cash-flow funding of the SAP in Funds are assumed to be restored to the GASB 45 OPEB Reserves in 2018 upon the reimbursement from NYS and a new funding source. Authorize staff to draw down the $149.5 million GASB 45 OPEB Reserves balance (after restoration of $80 million advance) to offset expenses in Authorize staff to suspend planned contributions to the GASB 45 OPEB Reserves beginning in This action would reduce operating-funded contributions by $101 million over the plan period. Authorize staff to suspend contributions to B&T s Necessary Reconstruction Reserve from 2018 to This action would reduce operating-funded contributions by $214 million over the plan period, still leaving $321 million in the fund. Authorize technical adjustments to MTA budgets and forecasts of a non-material nature in the February Plan. Authorize adjustment of MTA budgets and forecasts to reflect labor settlements approved from time to time by the Board. I-5

9 Staff Summary Page 6 of 7 Authorize staff, under the guidance and direction of the Chairman, Managing Director, the Chief Financial Officer or their designees (including the MTA Treasurer), to take additional budget and cash management actions, as has been done in past budgets, to draw on the general reserve and/or make budget adjustments to respond to unexpected expenses or revenue/subsidy shortfalls, and other actions described below: Advance of Bridges and Tunnels Operating Surplus The Board is requested to authorize Bridges and Tunnels to advance to MTA and NYC Transit, to the extent funds are available, all or part of the estimated operating surplus for the year Uses of MTA MRT-2 Corporate Account Monies Unlike many other forms of intergovernmental aid, these subsidy monies, by statute, can be allocated at the Board s discretion. It is recommended that the Board authorize that these funds be used as set forth in the Plan, authorize staff to administer these funds in a manner consistent with the Plan, and to temporarily help stabilize cash-flow requirements. As in the past, the advance of funds to the MTA and its affiliates and subsidiaries to stabilize cash-flow requirements may be made, provided they are repaid prior to the end of the fiscal year in which made. Uses of Payroll Mobility Tax (and Replacement Funds) and MTA Aid Like the MRT-2 Corporate Account moneys, these subsidy monies, by statute, can be allocated at the Board s discretion. It is recommended that the Board authorize that the revenues from the PMT (and Replacement Funds) be released as needed: (i) for pledged revenues by MTA to secure and be applied to the payment of bonds to be issued in the future, to fund capital projects of MTA, its subsidiaries, and MTA New York City Transit and its subsidiary and (ii) to pay capital costs, including debt service of MTA, its subsidiaries, and MTA New York City Transit and its subsidiary. It is further recommended that the Board authorize that subject to the provisions of any such pledge, or in the event there is no such pledge, the PMT Revenues be used by MTA to pay for costs, including operating and capital costs of MTA, its subsidiaries and MTA New York City Transit and its subsidiary. Further, it is recommended that the Board authorize that the revenues in the MTA Aid Trust Account (derived from four fees and taxes imposed in the Metropolitan Commuter Transportation District a supplemental motor vehicle license fee, a supplemental motor vehicle registration fee, a tax on medallion taxicab rides, and a supplemental tax on passenger car rentals) be released as needed and used as pledged revenues by MTA or pledged to the Triborough Bridge and Tunnel Authority to secure debt of MTA Bridges and Tunnels. Further, subject to the provisions of such pledge, or in the event there is no such pledge, the Board authorizes the release of these funds to be used by MTA for the payment of operating and capital costs of the MTA and its subsidiaries, and New York City Transit, and its subsidiary. Inter-Agency Loans The Board is requested to authorize staff acting under Section1266 (6-a) of the Public Authorities Law, to enter into inter-agency loan agreements among the MTA and its affiliates and subsidiaries. This authorization would allow the temporary movement of funds among agencies to meet cash flow requirements for operating or capital purposes resulting from a mismatch between the receipt of subsidies and other monies and cash flow needs. The statute requires that any such inter-agency loans be repaid no later than the end of the next succeeding calendar year. I-6

10 Staff Summary Page 7 of 7 Use of Stabilization Reserve: Provision for Prompt Payment of Contractual Obligations In 1996, the Board approved the establishment of a Stabilization Reserve, to be held by the MTA Treasurer (the Treasurer ), to stabilize MTA Agencies cash flow requirements. The fund consists of two accounts, the MTA New York City Transit Account (the Transit Account ) and the MTA Commuter Railroad Account (the Commuter Railroad Account ). The Board is requested to authorize the use of any balances in such accounts, plus any amounts authorized to be transferred to such accounts, to meet the cash flow requirements of MTA New York City Transit and the MTA Commuter Railroads and to authorize MTA New York City Transit to pay to the Treasurer for deposit in the Transit Account such amounts as it deems necessary to accomplish the purpose thereof, consistent with this Plan; and the Treasurer to pay into the Commuter Railroad Account, such amounts as are deemed necessary to accomplish the purpose thereof, consistent with this Plan. The Treasurer, upon request of MTA New York City Transit, shall pay to NYCT such amounts as are necessary to meet cash flow requirements of NYCT and shall transfer from the Commuter Railroad Account such amounts as are necessary to meet the cash flow requirements of MTA Commuter Railroads. The Treasurer shall also use such funds as from time to time may be necessary or convenient to timely make debt service payments on MTA bonds. Government Accounting Standards Board (GASB) Contributions In 2008, the MTA approved the establishment of the MTA Retiree Welfare Benefits Trust ( OPEB Trust ) to govern the administration and investment of the OPEB trust assets. Through 2014, $300 million was moved into the trust. The Treasurer will continue to hold the remaining funds set aside in discrete subaccounts that comprise the GASB Account. The Treasurer is authorized to use the GASB accounts to fund intra-agency loans as well as inter-agency loans. If an agency uses its own GASB funds to meet 2018 cash flow needs, the amounts withdrawn in 2018 must be paid back by December 31, If the GASB funds are used as inter-agency loans in 2018, they would be subject to repayment no later than December 31, 2019, consistent with the Inter-Agency Loan provision described above. As noted above, the Plan assumes that the remaining $149.5 million in the GASB 45 OPEB Reserves account will be needed to offset expenses in The Treasurer remains authorized to make intraagency and inter-agency loans in 2018 with any available funds. I-7

11 ($ in millions) Line No. Final 7 Non-Reimbursable Final Proposed 8 Actual Estimate Budget Operating Revenue METROPOLITAN TRANSPORTATION AUTHORITY November Financial Plan MTA Consolidated Statement Of Operations By Category Attachment A 11 Farebox Revenue $6,050 $6,172 $6,277 $6,308 $6,347 $6, Toll Revenue 1,870 1,906 1,923 1,937 1,946 1, Other Revenue Capital and Other Reimbursements Total Operating Revenue $8,608 $8,747 $8,886 $8,942 $9,023 $9, Operating Expense 18 Labor Expenses: 19 Payroll $4,839 $5,040 $5,360 $5,552 $5,676 $5, Overtime Health & Welfare 1,172 1,214 1,364 1,469 1,556 1, OPEB Current Payment Pensions 1,370 1,326 1,351 1,371 1,369 1, Other-Fringe Benefits , Reimbursable Overhead (425) (476) (426) (410) (388) (384) 26 Total Labor Expenses $9,238 $9,444 $10,033 $10,433 $10,768 $11, Non-Labor Expenses: 29 Electric Power $406 $444 $505 $519 $547 $ Fuel Insurance (21) Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Service Contracts Materials & Supplies Other Business Expenses Total Non-Labor Expenses $3,168 $3,471 $3,726 $3,644 $3,757 $3, Other Expense Adjustments: 41 Other $47 $52 $49 $50 $52 $53 42 General Reserve Total Other Expense Adjustments $47 $207 $209 $215 $227 $ Total Operating Expense before Non-Cash Liability Adj. $12,454 $13,122 $13,968 $14,292 $14,752 $15, Depreciation $2,443 $2,615 $2,674 $2,741 $2,808 $2, OPEB Liability Adjustment 1,562 1,681 1,776 1,871 1,975 2, GASB 68 Pension Expense Adjustment (219) (172) (235) (229) (246) (284) 50 Environmental Remediation Total Operating Expense after Non-Cash Liability Adj. $16,252 $17,250 $18,190 $18,681 $19,294 $19, Conversion to Cash Basis: Non-Cash Liability Adjs. ($3,798) ($4,128) ($4,222) ($4,390) ($4,542) ($4,677) Debt Service (excludes Service Contract Bonds) 2,459 2,525 2,604 2,800 3,029 3, Total Operating Expense with Debt Service $14,912 $15,647 $16,573 $17,092 $17,781 $18, Dedicated Taxes and State/Local Subsidies $6,666 $6,470 $6,659 $6,949 $7,119 $7, Net Surplus/(Deficit) After Subsidies and Debt Service $362 ($430) ($1,028) ($1,201) ($1,639) ($2,097) Conversion to Cash Basis: GASB Account 0 0 (8) (18) (29) (42) 65 Conversion to Cash Basis: All Other (594) CASH BALANCE BEFORE PRIOR-YEAR CARRYOVER ($232) ($342) ($1,028) ($1,012) ($1,572) ($2,114) 68 ADJUSTMENTS ,051 1,150 1, PRIOR-YEAR CARRYOVER NET CASH BALANCE $248 $78 $30 $69 ($352) ($643) I-8

12 METROPOLITAN TRANSPORTATION AUTHORITY November Financial Plan Plan Adjustments ($ in millions) Line No. Final 7 Final Proposed 8 Actual Estimate Budget Cash Balance Before Prior-Year Carry-over ($232) ($342) ($1,028) ($1,012) ($1,572) ($2,114) Fare/Toll Increases: 14 Fare/Toll Increase in March 2019 (4% Yield) Fare/Toll Increase in March 2021 (4% Yield) Subsidy Impacts of 2019/2021 Fare/Toll Increase - - (10) (10) (20) 17 Sub-Total $0 $0 $263 $313 $ MTA Efficiencies: 20 MTA Efficiencies - Not Yet Implemented (0) Additional MTA Efficiencies February Plan Additional MTA Efficiencies July Plan Sub-Total ($0) $214 $309 $388 $ Policy Actions: July Plan: 27 Restoration of PMT Replacement Funds GASB 45 OPEB Fund Reserves - Suspend Planned Contributions B&T Necessary Reconstruction - Suspend Planned Contributions Drawdown 2017 General Reserve November Plan: Subway Action Plan (SAP): 33 Remove SAP from NYCT Baseline SAP - Operating Costs (100) (408) (342) (301) (301) 35 Debt Service Expenses for SAP Capital Costs - (20) (21) (21) (21) 36 Pre-Funding of 2017 Capital Expenses (63) Additional State Funding for SAP New Sources of Funding for SAP Drawdown/(Redeposit) GASB 45 OPEB Reserves 80 (80) Drawdown/(Redeposit) Remaining 2017 General Reserve 20 (20) Drawdown GASB 45 OPEB Reserves Drawdown Remaining 2017 General Reserve Sub-Total $172 $766 $478 $450 $ TOTAL ADJUSTMENTS $0 $172 $979 $1,051 $1,150 $1, Prior-Year Carry-Over Net Cash Surplus/(Deficit) $248 $78 $30 $69 ($352) ($643) I-9

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14 II. Agencies Staff Summaries 2018 Budget and Financial Plan

15 Bridges and Tunnels

16 Staff Bridges and Tunnels Page 1 of 3 B&T 201 I B and Financial Plan Ad Office of the Chief Financial Officer Mildred Chua n Date December 4,2017 Vendor Name Contract Number Contract Manager Name Project Dore Abrams Name Table of Contents Ref # Board Action Order To Date Approval lnfo Other I B&T Committee X 2 Fi nance Committee X lnternal Approvals Order Approval Order Approval 2 President *-- Executive Vice President I VP & Chief Financial officer.fuu-' VP Procurement & Materials 3 MTA Board I 17 X Ceneral Counsel VP Labor Relations VP Operations VP & Chief Engineer lnternal Approvals r Order Approval Order Approval Order Aooroval Order Aooroval VP Safety & Health VP & Chief of Staff Other cont. /P & Chief Security )fficer VP Maintenance & )perations Support PURPOSE: To secure MTA Board adoption of the MTA Bridges and Tunnels' (B&T) 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan lor DISCUSSION: The 2018 Final Proposed Budget, which is consistent with information presented to the Board in November, provides sufficient funding to maintain B&T's planned service levels, as well as MTA's commitment to provide safe, reliable and efficient transportation service to the metropolitan New York region. The baseline projections exclude the estimated impacts from projected toll increases, unidentified MTA efficiencies, and MïA policy actions, These impacts will þe presented as part of MTA consolidated materials. B&T estimates that for 2017 and 2018 combined, $2,727.7 million will be provided in baseline net operating income NOVEMBER FORECAST:BASELINE The 2017 November Forecast projects $1,926.3 million in non-reimbursable revenues, of which $1,906.4 million is from Toll Revenue. Total non-reimbursable expenses before depreciation and other postemployment benefits are projected to be $545.6 million, consisting of million in labor expenses and $290.4 million in non-labor expenses. Total Support to Mass Transit is projected to be over $1.039 billion. Reimbursable revenue and expenses are both forecast at $23.9 million. Total end-of-year positions are projected at 1,589, including 1,502 non-reimbursable positions and 87 reimbursable positions. II-1

17 Staff Bridges and Tunnels Page 2 of FINAL PROPOSED BUDGET-BASELINE The 2018 Final Proposed Budget projects $1,943.4 million in non-reimbursable revenues, of which $1,923.2 million is from Toll Revenue. Total non-reimbursable expenses before depreciation and other post-employment benefits are projected to be $596.4 million, consisting of $278.3 million in laborexpenses and $318.1 million in non-labor expenses. Total Support to Mass Transit is projected to be nearly $1.020 billion. Reimbursable revenue and expenses are both forecast at $23.6 million. Total end-of-year positions are projected at 1,589, including 1,502 non-reimbursable positions and 87 reimbursable positions. MAJOR PROGRAMMATIC I NITIATIVES a New York Crossings Project (NYCP) - Major components of this initiative include: commute times, making it easier for New Yorkers to get where they need to go. Sensors and cameras are suspended over the highway on structures called gantries and vehicles are not required to stop. ORT began rolling out in November 2016 at the Henry Hudson Bridge, continued throughout 2017 with implementation at the Hugh L, Carey Tunnel, the Queens Midtown Tunnel, the RFK Bridge and the Verrazano-Narrows Bridge, and was completed on September 30th when both the Throgs Neck Bridge and the Bronx-Whitestone Bridge went live. ORT is now fully functional at all B&T facilities and this was achieved three months ahead of the original implementation schedule. approach in capturing MTA B&T's Total Cost of Ownership (TCO) for the new assets, systems and equipment that are now operational across the facilities. Best practice asset management principles aligned with operational goals and the overall strategic vision for MTA B&T's new business model for cashless toll collection provides a consistent approach and roadmap to ensuring sustainability of the agency across all aspects of the business and integrating the various departmental perspectives including safety, security, operations, engineering, maintenance, finance, law, procurement and administration. security efforts. Security teams have been combined with traffic enforcement at crossings and new operating protocols have been developed across agencies. o Programs to lncrease E-ZPass Usage > Marketing efforts promoting the savings and convenience of E-ZPass include a major media campaign on TV, radio and print supported by an informational campaign on MTA.info, social media and travelrelated mobile sites, as well as direct marketing in facility specific communities through handouts, door hangers, and pop-ups at community events. > MTA Reload Gard has made it significantly easier for customers to replenish their E-ZPass account with cash. To date, more than 171,000 cards have been issued to customers and approximately 20o/o of total cash replenishments are currently made using the reload cards. > E-ZPass Pay Per Trip enables customers to set up an E-ZPass account without a pre-paid balance by debiting their checking account through an Automated Clearinghouse (ACH) deduction on days when tolls are posted. To date, over 107,000 account holders have signed up for this program. II-2

18 Staff Bridges and Tunnels Page 3 of 3 IMPACT ON FUNDING The2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan , which are presented in the attached tables, are consistent with the proposed MTA Financial Plan. RECOMMENDATION It is recommended that the MTA Board adopt the 2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan for for MTA Bridges and Tunnels. The legal name of MTA Bridges and Tunnels is Triborough Bridge and Tunnel Authority II-3

19 MTA BRIDGES AND TUNNELS November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Toll Revenue $1, $1, $1, $1, $1, $1, Other Operating Revenue Capital and Other Reimbursements Investment Income Total Revenues $1, $1, $1, $1, $1, $1, Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead (6.680) (7.420) (7.568) (7.720) (7.874) (8.032) Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $5.803 $5.184 $7.027 $7.134 $7.559 $7.966 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $ $ $ $ $ $ Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (6.848) Environmental Remediation Total Expenses After Depreciation and GASB Adjs. $ $ $ $ $ $ Less: Depreciation Less: OPEB Liability Adjustment Less: GASB 68 Pension Exp Adjustment (6.848) Total Expenses $ $ $ $ $ $ Net Surplus/(Deficit) $1, $1, $1, $1, $1, $1, II-4

20 MTA BRIDGES AND TUNNELS November Financial Plan Accrual Statement of Operations By Category ($ in millions) Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Toll Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements Investment Income Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $7.974 $8.340 $8.506 $8.676 $8.850 $9.027 Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $ $ $ $ $ $ Net Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-5

21 MTA BRIDGES AND TUNNELS November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable / Reimbursable Page 1 of 2 Final Actual November Forecast Proposed Budget Operating Revenue Toll Revenue $1, $1, $1, $1, $1, $1, Other Operating Revenue Capital and Other Reimbursements Investment Income Total Revenues $1, $1, $1, $1, $1, $1, Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $5.803 $5.184 $7.027 $7.134 $7.559 $7.966 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $ $ $ $ $ $ Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (6.848) Environmental Remediation Total Expenses After Depreciation and GASB Adjs. $ $ $ $ $ $ Less: Depreciation Less: OPEB Liability Adjustment Less: GASB 68 Pension Exp Adjustment (6.848) Total Expenses $ $ $ $ $ $ Net Surplus/(Deficit) $1, $1, $1, $1, $1, $1, II-6

22 MTA BRIDGES AND TUNNELS November Financial Plan Accrual Statement of Operations by Category ($ in millions) Non-Reimbursable / Reimbursable Page 2 of 2 Final Actual November Forecast Proposed Budget Net Surplus/(Deficit) $1, $1, $1, $1, $1, $1, Deductions from Income: Less: Capitalized Assets $ $ $ $ $ $ B&T Capital Reserves GASB 45 Reserves Adjusted Net Surplus/(Deficit) $1, $1, $1, $1, $1, $1, Less: Debt Service $ $ $ $ $ $ Income Available for Distribution $ $ $ $ $ $ Distributable To: MTA - Investment Income $0.635 $0.987 $1.240 $1.240 $1.240 $1.240 MTA - Distributable Income NYCT - Distributable Income Total Distributable Income: $ $ $ $ $ $ Actual Cash Transfers: MTA - Investment Income - Prior Year $0.183 $0.635 $0.987 $1.240 $1.240 $1.240 MTA - Cash Surplus Transfer NYCT - Cash Surplus Transfer Total Cash Transfers: $ $ $ $ $ $ SUPPORT TO MASS TRANSIT: Total Revenue $1, $1, $1, $1, $1, $1, Total Expenses Before Non-Cash Liability Adjs Net Operating Income: $1, $1, $1, $1, $1, $1, Deductions from Operating Income: B&T Debt Service $ $ $ $ $ $ Capitalized Assets B&T Capital Reserves GASB Reserves Total Deductions from Operating Income: $ $ $ $ $ $ Total Support to Mass Transit: $1, $1, $1, $ $ $ II-7

23 MTA BRIDGES AND TUNNELS November Financial Plan Ridership (Utilization) (in millions) Actual November Forecast Final Proposed Budget TRAFFIC VOLUME Total Traffic Volume TOLL REVENUE Toll Revenue $1, $1, $1, $1, $1, $1, II-8

24 MTA BRIDGES AND TUNNELS November Financial Plan Budget Reduction Plan Summary ($ in millions) Favorable/(Unfavorable) Administration Pos Pos Pos Pos Pos Miscellaneous consulting (July Plan) Subtotal Administration Customer Convenience & Amenities None Subtotal Customer Convenience & Amenities Service/Service Support Open Road Tolling Subtotal Service/Service Support Maintenance/Operations Major Maintenance & Bridge Painting Lower negotiated E-ZPass tag price (July Plan) Subtotal Maintenance/Operations Revenue Enhancement None Subtotal Revenue Enhancement Safety/Security None Subtotal Safety/Security Enterprise Asset Management None Subtotal Enterprise Asset Management All Other None Subtotal All Other Agency Submission - $ $ $ $ $ II-9

25 MTA BRIDGES AND TUNNELS November Financial Plan Total Positions by Function and Department Non-Reimbursable/Reimbursable and Full-time/Full-time Equivalents FUNCTION/DEPARTMENT November Final Proposed Actual Forecast Budget Administration Executive Law (1) CFO (2) Administration EEO Total Administration Operations Revenue Management Operations (Non-Security) Total Operations Maintenance Maintenance Operations - Maintainers Total Maintenance Engineering/Capital Engineering & Construction Health & Safety Law (1) Planning & Budget Capital Total Engineering/Capital Public Safety Operations (Security) Internal Security - Operations Total Public Safety Total Positions 1,451 1,589 1,589 1,591 1,597 1,597 Non-Reimbursable 1,364 1,502 1,502 1,504 1,510 1,510 Reimbursable Total Full-Time 1,451 1,589 1,589 1,591 1,597 1,597 Total Full-Time Equivalents (1) Includes Legal and Procurement staff. (2) Includes Controller and Operating Budget staff (3) Includes Human Resources and Administration staff. II-10

26 MTA BRIDGES AND TUNNELS November Financial Plan Total Positions by Function and Occupational Group Non-Reimbursable and Reimbursable Total_Headcount_Reporting Final November Proposed Forecast Actual Budget FUNCTION / OCCUPATIONAL GROUP Administration Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Operations Total Administration Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies (1) Maintenance Total Operations Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies (2) Engineering / Capital Total Maintenance Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Public Safety Total Engineering Headcount Managers/Supervisors Professional, Technical, Clerical Operational Hourlies (3) Total Positions Total Public Safety Headcount Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Positions 1,451 1,589 1,589 1,591 1,597 1,597 (1) Represents Bridge and Tunnel Officers. These positions are paid annually, not hourly. (2) Represents maintenance personnel. These positions are paid annually, not hourly. (3) Represents Bridge and Tunnel Officers performing public safety. These positions are paid annually, not hourly. II-11

27 [THIS PAGE INTENTIONALLY LEFT BLANK] II-12

28 Capital Construction Company

29 Staff Canital Consbuetion Subject MTA CC 2018 Budget and20l Financial Plan Adoption Department Office of Executive Vice &v President & Chief Financial Officer Department Head Name I Anthony D'Amico Department Head Signature Project Manager Name Adam Rosenbloom Date December 1,2017 Vendor Name NA Contract Number NA Contract Manager Name NA Table of Contents Ref # NA Board Action lnternal Order To Date Approval lnfo other I I order Aooroval Order Aooroval I 12mn7 x President MTACC Finance Committee A/> t MTA Board r2n3n7 x Executive Vice President & Chief f inancial %t Oflicer Bufpose: To secure MTA Board adoption of the MTA Capital Construction's (MTACC) 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan for Ðiscussion: MTACC costs are 100 percent reimbursable from the MTA Capital Proglam. The Financial Plan contains costs that are non-project specific and are for the provision of company-wide construction support from specialty contractors and oversight agencies. The 2017 November Forecast project a staffing level of 146 by year-end and the 2018 Final Proposed Budget project a staffing level of 181 by year-end, which includes staff increases to support key MTA projects including LIRR Mainline Third Track Expansion as well as Penn Station Access November Forecast - Baseline: MTACC projects 2017 reimbursable expenses of $35.4 million. Non-labor costs are projected at $8.7 million. Approximately $4.4 million of those costs are required to fund audit service chargebacks, office space at 2Broadway, All-Agency Protective Liability (AAPL) insurance, budget system maintenance services as well as office space construction, renovations, furniture and associated moving costs at 2 Broadway. Monies are also budgeted for risk management software, legal, engineering and archeological services, reimbursement of NYCT for administrative support staff and services, and office costs including communications and upgrades to existing equipment, 2018 Final Proposed Budset - Baseline: MTACC projects expenses of S46. I million. The Final Proposed Budget contains non-labor costs projected at S9.5 million, which includes $4.2 million required funding for audit services, AAPL insurance, office space at 2 Broadway and budget system maintenance services. Similar to the November Forecast, the 2018 Budget includes reimbursement of NYCT for administrative support staff and services, consulting services to support project controls, change orders and claims management, legal, engineering and program management consulting services, office space construction, renovations, furniture and associated moving costs at 2 Broadway. Imnact on Fundine: The 2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan for , which are presented in the attached tables, are consistent with the proposed MTA Financial Plan. Recommendation: It is recommended that the MTA Board adopt the 2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan for for the MTA Capital Construction Company. II-13

30 MTA CAPITAL CONSTRUCTION November Financial Plan Accrual Statement of Operations By Category ($ in millions) Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime (0.002) Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $5.646 $8.714 $9.527 $9.259 $9.087 $7.961 Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Deprecation $ $ $ $ $ $ Net Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-14

31 MTA CAPITAL CONSTRUCTION November Financial Plan Cash Receipts and Expenditures ($ in millions) Cash Receipts and Expenditures Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements $ $ $ $ $ $ Total Receipts $ $ $ $ $ $ Expenditures Labor: Payroll $ $ $ $ $ $ Overtime (0.002) Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $ $ $ $ $ $ Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenditures $5.646 $8.714 $9.527 $9.259 $9.087 $7.961 Other Expenditure Adjustments: Other $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditure Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures $ $ $ $ $ $ Net Cash Balance $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-15

32 MTA CAPITAL CONSTRUCTION November Financial Plan Cash Conversion (Cash Flow Adjustments) Favorable/(Unfavorable) ($ in millions) Cash Flow Adjustments Final Actual November Forecast Proposed Budget Receipts Capital and Other Reimbursements $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Receipts $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Expenditures Labor: Payroll $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Non-Labor: Electric Power $0.000 $ $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenditures $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Expenditure Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditure Ajustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Cash Conversion Adjustments before Depreciation $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Depreciation $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 OPEB Liability Adjustment GASB 68 Pension Expense Adjustment Environmental Remediation Total Cash Conversion Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-16

33 MTA CAPITAL CONSTRUCTION November Financial Plan Total Positions by Function and Department Non-Reimbursable/Reimbursable and Full-Time/Full-Time Equivalents FUNCTION/DEPARTMENT November Final Proposed Actual Forecast Budget Administration MTACC Engineering/Capital MTACC East Side Access Security Second Avenue Subway Lower Manhattan Project Line Extension Penn Station Access 2 Total Engineering/Capital Total Baseline Positions Non-Reimbursable Reimbursable Total Full-Time Total Full-Time Equivalents II-17

34 MTA CAPITAL CONSTRUCTION November Financial Plan Total Positions by Function and Occupational Group Non-Reimbursable and Reimbursable Total_Headcount_Reporting Final November Proposed Forecast Actual Budget FUNCTION / OCCUPATIONAL GROUP Administration Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Operations Total Administration Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Maintenance Total Operations Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Engineering / Capital Total Maintenance Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Public Safety Total Engineering Headcount Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Positions Total Public Safety Headcount Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Positions II-18

35 Long Island Rail Road

36 D Long Island Rail Road Subject LIRR 2018 Budget & Financial Plan Adoption December 1, 2017 Department Vendor Name Office of Management & Budget Department Head Name Contract Number Francis Landers Depa~ ~ign~~e ~ AAA Project Manager Name 1JM Date Contract Manager Name Table of Contents Ref# Board Action Internal Approvals Order To Date Approval Info Other Order ApprovS~-1 Order Approval 1 MNR & LIRR ~.;ommittee 12/11117 X 3 President fj"j(_ VP Svc Ping Tech & CPM 2 Finance Committee 12/11/17 X Exec Vice President VP Mkt Dev & Public Affairs 3 MTA Board 12/13/17 X Sr. VP Operations General Counsel _ VP Labor Relations 2 VP& CFO 1o/ Internal Approvals (cont.) {1 Order Approval Order Approval Order Approval Order Approval. 1 Exec Dir Mgmt & Budgetf.'J.. Purpose To secure MTA Board adoption of the MTA Long Island Rail Road's (LIRR) 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan for Discussion The 2018 Final Proposed Budget, which is consistent with information presented to the Board in November, provides sufficient funding to maintain the Long Island Rail Road's commitment to provide safe, reliable and efficient commuter rail service to the metropolitan New York region. The 2018 Final Proposed Budget continues funding initiatives in support of these goals. The LIRR projections do not include the estimated impacts from projected fare increases, unidentified MTA efficiencies, and MTA policy actions. These impacts will be presented as part of MTA consolidated materials. The LIRR's financial plan contains funding to maintain infrastructure in reliable and safe condition. Its focus on Reliability Centered Maintenance (RCM) for rolling stock to ensure maximum fleet availability and on maintenance of the right-of way to maintain a state of good repair remain steadfast. This is particularly important as many components will enter critical maintenance stages. Funding and resources also are included to maintain the new Positive Train Control (PTC) system, both onboard trains and along the right of way. Safety continues to remain an area of focus. The 2018 Final Proposed Budget contains funding to support new FRA regulations regarding expanded drug and alcohol testing, sleep apnea testing, close call reporting, expanded system safety program risk reduction rule and road worker protection training for conductors. The financial plan also reflects ramp-up costs for East Side Access (ESA) readiness efforts. II-19

37 Achieving an efficient operation remains a priority. The baseline projections outlined below reflect both continued financial savings from past non-service related budget reduction initiatives and new or enhanced reduction initiatives. The LIRR has developed more sophisticated staffing models to strike a more efficient balance between straight time and overtime usage. The LIRR is reviewing third party contractual spending trends to identify future savings opportunities. The LIRR continues to subject all areas of the budget to intensive review, specifically payroll-related operational costs, overtime, inventory and administration November Forecast - Baseline Non-Reimbursable/Reimbursable expenses for the 2017 November Forecast before non-cash liability adjustments total $1,825.3 million. This is comprised of $1,454.8 million of Non-Reimbursable expenses and $370.5 million of Reimbursable expenses. Total Non-Reimbursable/Reimbursable revenue for the 2017 November Forecast is $1,157.2 million. This is comprised of $786.7 million of Non-Reimbursable revenue and $370.5 million of Reimbursable revenue. Total positions is 7,414. The Non-Reimbursable revenue for the 2017 November Forecast of $786.7 million includes Farebox Revenue projections of $730.1 million. This is based on a projected annual ridership of 89.4 million customers, which is a slight increase over The Forecast also assumes $56.6 million in other revenue from advertising, rental fees, special services and freight. Excluding non-cash liability adjustments, Non-Reimbursable expenses for the 2017 November Forecast totals $1,454.8 million. Including non-cash liability adjustments, total Non-Reimbursable expenses for the 2017 November Forecast increases to $1,882.2 million. The cash adjustments for non-cash items and timing of expenses/receipts total $420.2 million. The resulting Net Cash Deficit is projected to be $675.3 million in Total Non-Reimbursable positions is 6,106 positions. Total Reimbursable positions is 1, Final Proposed Budget - Baseline Non-Reimbursable/Reimbursable expenses for the 2018 Final Proposed Budget before non-cash liability adjustments are $2,017.2 million, comprised of $1,619.8 million of Non-Reimbursable expenses and $397.4 million of Reimbursable expenses. The total Non-Reimbursable/Reimbursable revenue for the 2018 Final Proposed Budget is $1,191.7 million, comprised of $794.3 million of Non-Reimbursable revenue and $397.4 million of Reimbursable revenue. The Non-Reimbursable revenue for the 2018 Final Proposed Budget of $794.3 million includes Passenger Revenue projections of $747.3 million and $47.0 million in other revenue from advertising and rental fees. The Farebox revenue is based on a projected annual ridership of 90.4 million passengers, which is a 1.1% increase over Excluding non-cash liability adjustments, Non-Reimbursable expenses for the 2018 Final Proposed Budget totals $1,619.8 million. Including non-cash liability adjustments, total Non-Reimbursable expenses for the 2018 Final Proposed Budget increases to $2,053.2 million. Cash adjustments for non-cash items and timing of expenses/receipts total $398.3 million. The resulting Net Cash Deficit is projected to be $860.6 million in II-20

38 The Non-Reimbursable expense budget, before non-cash liability adjustments, of $1,619.8 million is comprised of $1,130.7 million in labor expenses (payroll and benefits), which represent 70% of total expenses. The balance of the expenses are non-payroll and are related to the operation and maintenance of the fleet and infrastructure, with expenses allocated for electric power and fuel of $113.3 million, materials & supplies of $185.4 million, professional and maintenance services contracts of $140.3 million and all other costs of $50.1 million. Total Non-Reimbursable headcount is 6,502 positions. Total Reimbursable headcount is 1,223 positions. The Total Non-Reimbursable/Reimbursable headcount is 7,725, of which 91 percent are in the operating departments. Budget Reduction Initiatives Tighter management control and increased oversight of non-payroll budgets along with reduced fleet maintenance costs with the retirement of the M3 and the new M9 under warranty result in savings of $8.2 million on average every year of the financial plan. Impact on Funding The 2017 November Forecast, 2018 Final Proposed Budget and the Four-Year Financial Plan , which are presented in the attached tables, are consistent with the proposed MTA Financial Plan. Recommendation It is recommended that the MTA Board adopt the 2017 November Forecast, the 2018 Final Proposed Budget and the Four-Year Financial Plan for for the MTA Long Island Rail Road. II-21

39 MTA LONG ISLAND RAIL ROAD November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue $ $ $ $ $ $ Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead (34.392) (37.379) (28.924) (22.914) (18.162) (18.567) Total Labor Expenses $1, $1, $1, $1, $1, $1, Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $1, $1, $1, $1, $1, $1, Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (12.175) Environmental Remediation (1.756) Total Expenses $1, $1, $2, $2, $2, $2, Net Surplus/(Deficit) ($1, ) ($1, ) ($1, ) ($1, ) ($1, ) ($1, ) Cash Conversion Adjustments Depreciation $ $ $ $ $ $ Operating/Capital (14.885) (11.288) (39.265) (13.168) (13.999) (13.713) Other Cash Adjustments Total Cash Conversion Adjustments $ $ $ $ $ $ Net Cash Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($1, ) ($1, ) II-22

40 MTA LONG ISLAND RAIL ROAD November Financial Plan Accrual Statement of Operations By Category ($ in millions) Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $1.047 $0.783 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Deprecation $ $ $ $ $ $ Net Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-23

41 MTA LONG ISLAND RAIL ROAD November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable / Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue $ $ $ $ $ $ Other Operating Revenue Capital and Other Reimbursements Total Revenues $1, $1, $1, $1, $1, $1, Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $1, $1, $1, $1, $1, $1, Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $1, $1, $2, $2, $2, $2, Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (12.175) Environmental Remediation (1.756) Total Expenses $2, $2, $2, $2, $2, $2, Net Surplus/(Deficit) ($1, ) ($1, ) ($1, ) ($1, ) ($1, ) ($1, ) Cash Conversion Adjustments Depreciation $ $ $ $ $ $ Operating/Capital (14.885) (11.288) (39.265) (13.168) (13.999) (13.713) Other Cash Adjustments Total Cash Conversion Adjustments $ $ $ $ $ $ Net Cash Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($1, ) ($1, ) II-24

42 MTA LONG ISLAND RAIL ROAD November Financial Plan Cash Receipts and Expenditures ($ in millions) Cash Receipts and Expenditures Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $ $ $ $ $ $ Other Operating Revenue Capital and Other Reimbursements Total Receipts $1, $1, $1, $1, $1, $1, Expenditures Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $1, $1, $1, $1, $1, $1, Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenditures $ $ $ $ $ $ Other Expenditure Adjustments: Other $ $ $ $ $ $ Total Other Expenditure Adjustments $ $ $ $ $ $ Total Expenditures $1, $1, $2, $2, $2, $2, Net Cash Balance ($ ) ($ ) ($ ) ($ ) ($1, ) ($1, ) Cash Timing and Availability Adjustment (3.820) (0.000) (0.000) (0.000) (0.000) (0.000) Net Cash Balance after Cash Timing & Availability Adj ($ ) ($ ) ($ ) ($ ) ($1, ) ($1, ) II-25

43 MTA LONG ISLAND RAIL ROAD November Financial Plan Cash Conversion (Cash Flow Adjustments) ($ in millions) Cash Flow Adjustments Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $ $ $ $ $ $ Other Operating Revenue (8.674) (12.811) (12.690) (13.125) (13.475) (13.831) Capital and Other Reimbursements (27.894) (19.880) (39.794) (13.708) (14.551) (14.274) Total Receipts ($16.973) ($13.333) ($34.484) ($8.833) ($10.026) ($10.105) Expenditures Labor: Payroll $2.417 $9.509 $6.617 $6.767 $6.920 $7.076 Overtime (0.111) Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund (1.308) (1.737) (2.565) (3.441) Reimbursable Overhead Total Labor Expenditures $ $ $6.309 $6.030 $5.355 $4.635 Non-Labor: Electric Power ($0.239) ($0.300) $0.000 $0.000 $0.000 Fuel (0.518) Insurance (0.552) Claims Paratransit Service Contracts Maintenance and Other Operating Contracts (11.454) Professional Services Contracts Materials and Supplies (0.351) (8.735) Other Business Expenses Total Non-Labor Expenditures $ $7.237 $ $8.369 $8.796 $0.775 Other Expenditure Adjustments: Other Expense Adjustments ($20.177) ($18.000) ($18.000) ($18.000) ($18.000) ($18.000) Total Other Expenditure Ajustments ($20.177) ($18.000) ($18.000) ($18.000) ($18.000) ($18.000) Total Expenditures $ $6.157 ($0.599) ($3.601) ($3.849) ($12.590) Total Cash Conversion Adjustments before Depreciation $ ($7.176) ($35.083) ($12.434) ($13.875) ($22.695) Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (12.175) Environmental Remediation (1.756) Cash Timing and Availability Adjustment (3.820) Total Cash Conversion Adjustments $ $ $ $ $ $ II-26

44 MTA LONG ISLAND RAIL ROAD November Financial Plan Ridership/(Utilization) ($ in millions) 2016 Actual 2017 November Forecast 2018 Final Proposed Budget RIDERSHIP Monthly Weekly Total Commutation One-Way Full Fare One-Way Off Peak All Other Total Commutation Total Ridership FAREBOX REVENUE Total Farebox Revenue $ $ $ $ $ $ II-27

45 MTA LONG ISLAND RAIL ROAD November Financial Plan Budget Reduction Summary ($ in millions) Favorable/(Unfavorable) Administration Pos Pos Pos Pos Pos None Subtotal Administration Customer Convenience/Amenities None Subtotal Customer Convenience/Amenities Maintenance Anticipated reduced RCM Maintenance with the elimination of the M3s and the new M9s being under warranty. (July Plan) Tighter Control and Prioritization of Non Payroll Funds to Core Mission Initiatives (July Plan) Subtotal Maintenance Revenue Enhancement None Subtotal Revenue Enhancement Safety Security Service None Subtotal Safety None Subtotal Security None Subtotal Service Service Support Reduction to Train Service Overtime Hours (July Plan) Subtotal Service Support Other None Subtotal Other Agency Submission - $ $ $ $ $8.223 II-28

46 MTA LONG ISLAND RAIL ROAD November Financial Plan Total Positions by Function and Department Non-Reimbursable/Reimbursable and Full-Time/Full Time Equivalents FUNCTION/DEPARTMENT 2016 Actual 2017 November Forecast 2018 Final Proposed Budget Administration Executive VP Enterprise Asset Management Sr Vice President - Engineering Labor Relations Procurement & Logistics (excl. Stores) Human Resources Sr VP Administration Strategic Investments President VP & CFO Information Technology Controller Management and Budget BPM, Controls, & Compliance Market Dev. & Public Affairs Gen. Counsel & Secretary Diversity Management Security System Safety Training Service Planning Rolling Stock Programs Sr Vice President - Operations Total Administration Operations Train Operations 2,129 2,201 2,366 2,377 2,474 2,503 Customer Service Total Operations 2,422 2,504 2,669 2,680 2,777 2,923 Maintenance Engineering 1,889 1,997 2,093 2,113 2,010 2,082 Equipment 2,074 2,094 2,133 2,128 2,086 2,380 Procurement (Stores) Total Maintenance 4,058 4,188 4,323 4,336 4,191 4,557 Engineering/Capital Department of Program Management Special Projects/East Side Access Positive Train Control Total Engineering/Capital Total Positions 7,114 7,414 7,725 7,752 7,706 8,227 Non-Reimbursable 6,195 6,106 6,502 6,693 6,830 7,362 Reimbursable 919 1,308 1,223 1, Total Full-Time 7,114 7,414 7,725 7,752 7,706 8,227 Total Full-Time Equivalents II-29

47 MTA LONG ISLAND RAIL ROAD November Financial Plan Total Positions by Function and Occupational Group Non-Reimbursable and Reimbursable Total_Headcount_Reporting Final November Proposed Forecast Actual Budget FUNCTION / OCCUPATIONAL GROUP Administration Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Operations Total Administration Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies 2,037 2,112 2,276 2,294 2,376 2,475 Maintenance Total Operations Headcount 2,422 2,504 2,669 2,680 2,777 2,923 Managers/Supervisors Professional/Technical/Clerical Operational Hourlies 3,103 3,120 3,211 3,256 3,122 3,385 Engineering / Capital Total Maintenance Headcount 4,058 4,188 4,323 4,336 4,191 4,557 Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Public Safety Total Engineering Headcount Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Positions Total Public Safety Headcount Managers/Supervisors 1,342 1,497 1,527 1,478 1,476 1,577 Professional, Technical, Clerical Operational Hourlies 5,247 5,338 5,593 5,654 5,601 5,963 Total Positions 7,114 7,414 7,725 7,752 7,706 8,227 II-30

48 Metro-North Railroad

49 Staff Page 1 of3 Metro-North Railroad Subject MNR 2018 Budget and Financial Plan Adoption Department Budoet Deoartment Head Name. stå""" weiss Department Head Signature Project Manager Name ^Ñlurrt Date December 5,2017 Vendor Name Contract Number Contract Manager Name Table of Contents Ref# Board Action Order To Date Approval lnfo Other 1 MNR&LIRR Comm. Mtg. 12t11t MTA Fin. Comm MTA Board Mtg 12t13t2017 lnternal Approvals Order Approval_ Order Approval 3 1 Budset J U VP Operations 'r) VP Capital Programs 2 VP Finance and lt.( Engr/Const Controller Project Reporting lnternal Approvals (cont.) Order Approval Order Approval Order Approval Order Approval VP Planning & Development Corporate & Public Affairs Labor Relat ons Press VP Human Resources Human Resources Other General Counsel Puroose To secure MTA Board adoption of the MTA Metro-North Railroad's (MNR) 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan Discussion: The November Financial Plan reflects the financial impact of several new and ongoing programs. MNR projections do not include the estimated impacts from projected fare increases in New York State, unidentified MTA etficiencies, and MTA policy actions. These impacts will be presented as part of MTA consol dated materials. Our Strategic Plan: Our Railroad, Our Vision, Our Future ln June of 2016, we launched a new five-year Metro-North Strategic Plan. Our mission is to be a safe, reliable and efficient railroad providing regional mobility and excellent service to our customers. Our plan identifies 3 Priority Areas: Our People, Our Customers and Our lnfrastructure: Our People - Be an engaged, accountable and high perform ng workforce. o Our Customers - Consafently meet customer expectat ons by ensuring safe, reliable, accessible and comfo table service, and by providing timely, accurate and open commun cat on.. Our lnfrastructure - Ensure that allassefs are in a state of good repair. Maior Proqrammatic lnitiatives included in the Financial Plan The November Financial Plan provides on-going support to continue infrastructure maintenance activities required to restore and maintain a State of Good Repair that allows Metro-North to provide continued safe and reliable service to our customers. This level of infrastructure maintenance (along with Capital program improvements) are on-going programs that are expected to continue indefinitely. The November Financial Plan also continues the process of identifying new programs that support the Metro-North Plan. Each investment is ali ned with one of the ic Plan riorities. The legal name of MTA Metro-North Railroad is Metro-North Commuter Railroad Company II-31

50 lnvestments in Our People o TranspoñationStaffing Hire four additional Trainmasters, three of which are for capital programs, to optimize the staffing levels and ensure safe and reliable train service. ln addition, three conductor positions will be added to ensure proper coverage when moving trains within the Grand Central Terminal (GCT) yard as per Federal Railroad Administration (FRA) requirements in the most cost etfective manner possible.. Expanded Drug and Alcohol Testing Hire two positions to assist with enforcement and management of the MNR Drug Policies and Programs. These positions will ensure MNR can achieve the federally required number of monthly Random Toxicological Tests and provide focused oversight and direction to the Maintenance of Way random testing program. On-going Programs and Assumptions previously included in the July Financial Plan which continue in the 2018 Final Proposed Budget are as follows: lnvestments in Our People. Future Chief Rail Traffic Controller (RTC)Training Program This Program will hire, train and qualify future Chief RTCs to fill vacancies and prepare for future succession. The first three hires for this new program are expected to be in place by the end of the year to assist with Positive Train Control (PTC) implementation needs and 2417 coverage. lnvestments in Our Gustomerc o Renovation of Grand Central Terminal (GCT) Resúrooms in the Dining Concourse The restrooms on the lower GCT concourse are in need of significant repair. The last renovation to these restroom facilities occurred ten years ago. With approximately 750,000 people passing through this facility each day, these restrooms require an upgrade to ensure appropriate restroom capacity and functionality for MNR passengers, retail customers, tourists and future East Side Access passengers. lnvestments in Our lnfrastructure o Purchase of the Metro-Enviro Property in Croton-on-Hudson The Croton Harmon Yard has reached maximum capacity and to alleviate this situation, MNR will purchase property adjacent to the Hudson Main Line in close proximity to the Croton Harmon facility. This new property will be utilized to support MNR service delivery and leverage future Capital Program Plans to support growth and operational resil iency. o /VYS - Grade Crossing Upgrades Perform numerous grade crossing upgrades, the bulk of which will be funded by New York State and Municipality grants, o Priority Repairs & Maintenance for Highbridge District Add two new station maintenance gangs based out of the Highbridge District to allow for the resizing of the service areas to enhance stations and facilities maintenance service on the lower Harlem & Hudson lines with cost and time savings, o Grand Central Terminal Weekend Maintenance Personnel lncrease the weekend work force in Grand Central Terminal by adding required maintenance disciplines necessary to address scheduled maintenance during the overnight closure period and respond to emergency repairs. o Bridge Monitor lnstallation lnstall approximately twenty autonomous bridge monitoring systems in New York State that can detect impacts from vehicles striking bridges and provide real{ime feedback on the effect of the impact on the structural integrity of the bridges. This program will enable quicker response time for necessary repairs to damaged bridges. Governor's lnitiative o Design and Build of Beacon Rail Trail, Pa t of NYS Empire Trail ln January 2017, New York State Governor Andrew Cuomo announced in his State of the State address a proposal for the New Empire State Trail. One new trail connection sought as part of New Empire State Trail is to link the existing Putnam Trailway with the existing Dutchess Rail Trail, which will use a portion of the Beacon line, an asset owned by the MTA and Metro-North. The proposed trail will mostly follow the right-oêway of a segment of the Metro-North owned Beacon Line. There is an allocation in the New York State Budget to reimburse the MTA. 2of3 The legal name of MTA Metro-North Railroad is Metro-North Commuter Railroad Company II-32

51 Utlllzatlon The 2017 November Forecast projects nearly 86.6 million East and West of Hudson riders, a slight increase of 0,1 % over ridership is projected to grow approximately 0.7o/o annually with growth occurring across all eommuter lines. Metro-North's financial plan projections assume a 1.0% fare increase in Connecticut, etfective January 1, There are no budgeted fare increases in New York State thru Budqet Rqduction lnitiatives of $5.3 million have been incorporated into Metro-North's 2017 November Forecast- Bàsètine w tn ES.g scheduled for the 2019 Final Proposed Budget and annually for the Financial Plan, These initiatives include: retiming of M-7 airbrake maintenance, miscellaneous reductions to professional services, maintenance and other operating contracts, overtime and associated fringe reductions, and reductions to materials and supplies expenses, 2017 November Forecast-Baseline The 2017 non-reimbursable forecast reflects revenuee totaling $799.3 million, including $737,0 million of Farebox Revenues and $62.3 million in Other Operating Revenue. Total Operating Expense projections of $1,598.2 million consist of labor costs of $925,1 million, non-labor costs of $384.7 million and non-cash accruals of $288,3 million for Depreciation ($235.5 million), Other Post-Employment Benefits ($58,0 million), GASB 68 Pension Adjustment credit of ($6.8 million) and Environmental Remediation ($1.6 million), After including additional cash requirements adjustment of $215.1 million, the projeoted net cash deficit ie $583.8 million of which $460.8 million represents the MTA share and $123.0 million the CDOT share. Total reimbursable expense projections of $253.2 million are fully otfset by capital reimbursements. Total end-of-year authorized positions are projected at 6,939 and include 6,332 non-reimbursable positions and 607 reimbursable positions Final Proposed Budqet-Baseline Tñe 2OiA i ñal proposed non-reimbursable budget reflects revenues totaling $829.2 million. Farebox Revenue of $753.8 million reflects slightly higher ridership and the impact of a 1.0% State of Connecticut fare increase effective January I't, Other Operating Revenue of $75.4 million reflects GCT net retail revenues, advertising, and outlying station & parking revenue. Totai Operating Expense projections of $1,650.8 million consist of labor costs of $933.5 million, noniabor õosts of $405.1 million and non-cash accruals ol $312.2 million, which are comprised of Depreciation ($246.5 million), Other Post-Employment Benefits ($58.0 million), GASB 68 Pension Adjustment ($3.7 million)and Environmental Remediation ($4.0 million). After additional cash requirements adjustment of $253.8 million, the projected net cash deficit is $567.8 million of which $449.7 million represents the MTA share and $118.1 million the CDOT share. Total reimbursable expense projections of $272.9 million are fully offset by capital reimbursements. Total end-of-year authorized positions are projected at 7,006 and include 6,255 non-reimbursable positions and 751 reimbursable positions. lmpact on Fundinq:The2017 November Forecast, the 2018 Final Proposed Budget and the Four-Year Financial Plan for 2Q , which are presented in the attached schedules, are consistent with the proposed MTA Financial Plan. Recommendation: lt is recommended that the MTA Board adopt the 2017 November Forecast,2018 Final Proposed B and the Four-Y n for lor MTA Metro-North Rai 3of3 The legal neme of MTA Metro-North Railroad is Metro-North Commuter Rallroad Company II-33

52 MTA METRO-NORTH RAILROAD November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Farebox Revenue $ $ $ $ $ $ Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead (48.843) (49.565) (60.355) (61.500) (60.476) (56.896) Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $1, $1, $1, $1, $1, $1, Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (10.497) (6.808) (6.700) (24.100) Environmental Remediation Total Expenses $1, $1, $1, $1, $1, $1, Net Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) Cash Conversion Adjustments Depreciation $ $ $ $ $ $ Operating/Capital (39.286) (60.378) (92.158) (54.601) (59.420) (21.711) Other Cash Adjustments Total Cash Conversion Adjustments $ $ $ $ $ $ Net Cash Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) Note: Beginning with 2017, ticket sales revenue collected on West of Hudson operations by New Jersey Transit has been reclassified to the Farebox Revenue category. Previously, such revenue was classified as an offset under the Other Business Expenses category. In this Financial Plan, 2016 results have been adjusted for consistency with the projections. This shift does not change the bottom line or impact subsidies. II-34

53 MTA METRO-NORTH RAILROAD November Financial Plan Accrual Statement of Operations By Category ($ in millions) Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue MNR - MTA MNR - CDOT MNR - Other Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $0.131 $0.064 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Deprecation $ $ $ $ $ $ Net Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-35

54 MTA METRO-NORTH RAILROAD November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable / Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Farebox Revenue $ $ $ $ $ $ Other Operating Revenue MNR - MTA MNR - CDOT MNR - Other Capital and Other Reimbursements Total Revenues $ $1, $1, $1, $1, $1, Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead (3.181) (1.913) (2.755) (2.058) (1.930) (0.535) Total Labor Expenses $1, $1, $1, $1, $1, $1, Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $1, $1, $1, $1, $1, $1, Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (10.497) (6.808) (6.700) (24.100) Environmental Remediation Total Expenses $1, $1, $1, $1, $1, $1, Net Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) Cash Conversion Adjustments Depreciation $ $ $ $ $ $ Operating/Capital (39.286) (60.378) (92.158) (54.601) (59.420) (21.711) Other Cash Adjustments Total Cash Conversion Adjustments $ $ $ $ $ $ Net Cash Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) II-36

55 MTA METRO-NORTH RAILROAD November Financial Plan Cash Receipts and Expenditures ($ in millions) Cash Receipts and Expenditures Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $ $ $ $ $ $ Other Operating Revenue MNR - MTA MNR - CDOT MNR - Other Capital and Other Reimbursements Total Receipts $1, $1, $1, $1, $1, $1, Expenditures Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $1, $1, $1, $1, $1, $1, Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenditures $ $ $ $ $ $ Other Expenditure Adjustments: Other $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Cash Timing and Availability Adjustment Total Other Expenditure Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures $1, $1, $1, $1, $1, $1, Net Cash Balance ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) Subsidies MTA $ $ $ $ $ $ CDOT Total Subsidies $ $ $ $ $ $ II-37

56 MTA METRO-NORTH RAILROAD November Financial Plan Cash Conversion (Cash Flow Adjustments) ($ in millions) Cash Flow Adjustments Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $2.615 ($12.278) ($12.202) ($12.442) ($12.764) ($12.950) Other Operating Revenue MNR - MTA (31.903) (0.885) (3.556) MNR - CDOT (1.804) MNR - Other Total Capital and Other Reimbursements $ ($25.627) $ $0.684 ($3.556) $1.519 Total Receipts $ $2.642 $ $ $4.549 $9.855 Expenditures Labor: Payroll $1.700 $7.117 ($11.007) ($0.012) ($10.270) $1.680 Overtime (2.439) (2.116) Health and Welfare (22.335) (3.836) (4.133) (4.079) (4.081) (3.818) OPEB Current Payments (0.363) Pension (1.385) (0.391) (0.519) (0.395) (0.346) (0.126) Other Fringe Benefits (13.082) Contribution to GASB Fund (0.160) (0.200) (0.200) (0.200) Reimbursable Overhead (3.181) (1.913) (2.755) (2.058) (1.930) (0.535) Total Labor Expenditures ($38.238) $9.702 ($18.517) ($1.648) ($16.885) $2.837 Non-Labor: Electric Power ($3.462) ($1.901) (1.901) ($1.901) ($1.901) ($1.901) Fuel Insurance (1.863) (0.214) (0.123) (1.028) Claims (10.658) (11.122) (2.035) (0.146) (0.146) (0.146) Paratransit Service Contracts Maintenance and Other Operating Contracts (13.433) (18.940) (32.565) (29.332) (43.847) (11.223) Professional Services Contracts (15.352) (12.026) (24.128) (4.448) (1.450) (0.030) Materials and Supplies (8.590) (7.013) (19.064) (8.597) (1.858) (1.826) Other Business Expenses (27.316) (33.187) (17.137) (18.642) (16.237) (16.468) Total Non-Labor Expenditures ($74.559) ($85.594) ($96.576) ($62.713) ($65.981) ($31.086) Other Expenditure Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditure Ajustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures ($ ) ($75.892) ($ ) ($64.362) ($82.866) ($28.249) Total Cash Conversion Adjustments before Depreciation ($48.284) ($73.251) ($58.431) ($50.917) ($78.317) ($18.394) Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (10.497) (6.808) (6.700) (24.100) Environmental Remediation Total Cash Conversion Adjustments $ $ $ $ $ $ II-38

57 MTA METRO-NORTH RAILROAD November Financial Plan Ridership (Utilization) (in millions) Actual November Forecast Final Proposed Budget RIDERSHIP Harlem Line Ridership - Commutation Harlem Line Ridership - Non-Commutation Harlem Line Hudson Line Ridership - Commutation Hudson Line Ridership - Non-Commutation Hudson Line New Haven Line Ridership - Commutation New Haven Line Ridership - Non-Commutation New Haven Line Total Commutation Ridership Total Non-Commutation Ridership Total East of Hudson Ridership West of Hudson Ridership Total Ridership FAREBOX REVENUE Harlem Line - Commutation Revenue Harlem Line - Non-Commutation Revenue Harlem Line $ $ $ $ $ $ Hudson Line - Commutation Revenue Hudson Line - Non-Commutation Revenue Hudson Line $ $ $ $ $ $ New Haven Line - Commutation Revenue New Haven Line - Non-Commutation Revenue New Haven Line $ $ $ $ $ $ Total Commutation Revenue $ $ $ $ $ $ Total Non-Commutation Revenue Total East of Hudson Revenue $ $ $ $ $ $ West of Hudson Revenue $ $ $ $ $ $ Total Farebox Revenue $ $ $ $ $ $ Notes: West of Hudson total ridership is both Pascack Valley and Port Jervis lines. Beginning with 2017, ticket sales revenue collected on West of Hudson operations by New Jersey Transit has been reclassified to the Farebox Revenue category. Previously, such revenue was classified as an offset under the Other Business Expenses category. In this Financial Plan, 2016 results have been adjusted for consistency with the projections. This shift does not change the bottom line or impact subsidies. II-39

58 MTA Metro-North Railroad November Financial Plan Budget Reduction Plan Summary ($ in millions) Administration Pos Pos Pos Pos Pos Reductions to Professional Service Contracts (July Plan) - $ $ $ $ $0.848 Reductions to Other Business Expenses (July Plan) Subtotal Administration Customer Convenience/Amenities None Subtotal Customer Convenience/Amenities Maintenance/Operations Favorable/(Unfavorable) FRA Waiver to allow retiming of M7 airbrake maintenance cycle from 5 to 6 years (July Plan) Miscellaneous Maintenance and Other Operating Contracts Reductions (July Plan) Reductions to Materials & Supplies (July Plan) Lower Non-Revenue Vehicle Fuel Consumption (July Plan) Subtotal Maintenance/Operations Revenue Enhancement None Subtotal Revenue Enhancement Safety/Security None Subtotal Safety Service Reductions to Overtime & Fringe (July Plan) Subtotal Service Service Support None Subtotal Service Support Other None Subtotal Other Agency Submission - $ $ $ $ $5.258 II-40

59 MTA METRO-NORTH RAILROAD November Financial Plan Total Positions by Function and Department Non-Reimbursable/Reimbursable and Full-Time/Full-Time Equivalents November Final Proposed FUNCTION/DEPARTMENT Actual Forecast Budget Administration President Labor Relations Safety Security Office of the Executive VP Corporate & Public Affairs Customer Service Legal Claims Environmental Compliance & Svce VP Human Resources Training Employee Relations & Diversity VP Planning Operations Planning & Analysis Capital Planning & Programming Long Range Planning VP Finance & Info Systems Controller Information Technology & Project Mgmt Budget Procurement & Material Management Corporate Total Administration Operations Operations Administration Transportation 1,578 1,513 1,517 1,517 1,517 1,517 Customer Service Metro-North West Total Operations 1,969 1,926 1,930 1,930 1,930 1,930 Maintenance Maintenance of Equipment 1,628 1,764 1,764 1,764 1,764 1,764 Maintenance of Way 2,050 2,388 2,433 2,437 2,439 2,439 Procurement & Material Management Total Maintenance 3,799 4,281 4,331 4,335 4,337 4,337 Engineering/Capital Construction Management Engineering & Design Total Engineering/Capital Total Positions 6,359 6,939 7,006 7,010 7,012 7,012 Non-Reimbursable 5,981 6,332 6,255 6,262 6,260 6,276 Reimbursable Total Full-Time 6,358 6,938 7,005 7,009 7,011 7,011 Total Full-Time-Equivalents II-41

60 MTA METRO-NORTH RAILROAD November Financial Plan Total Positions by Function and Occupation November Final Proposed FUNCTION/OCCUPATIONAL GROUP Actual Forecast Budget Administration Operations Maintenance Engineering/Capital Public Safety Total Positions Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Administration Managers/Supervisors Professional, Technical, Clerical Operational Hourlies 1,579 1,497 1,497 1,497 1,497 1,497 Total Operations 1,969 1,926 1,930 1,930 1,930 1, Managers/Supervisors Professional, Technical, Clerical Operational Hourlies 2,692 3,030 3,067 3,070 3,072 3,072 Total Maintenance 3,799 4,281 4,331 4,335 4,337 4, Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Engineering/Capital Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Public Safety Managers/Supervisors 1,040 1,140 1,153 1,153 1,153 1,153 Professional, Technical, Clerical 1,048 1,272 1,289 1,290 1,290 1,290 Operational Hourlies 4,271 4,527 4,564 4,567 4,569 4,569 Total Positions 6,359 6,939 7,006 7,010 7,012 7,012 II-42

61 MTA Headquarters

62 Staff Summary Subject MTA HQ 2018 Budgetand Financial Plan Adoption Department Chief Financial Officer Department Head Name Robert å Foran, Chief Financial Officer oeghfrffisisnature il?åtiïînî:,'üää/ Bo/rd Action Date November 30,2017 Vendor Name Contract Contract Manager Name Table of Contents Ref # Uetronoritan Transportation Authority lnternal Approvals Page 1 of2 Order To Date Approval 1 Finance Comm. 1 2t1 1 lnfo Other Order Aporoval Order Approval 1 tesat/fí 2 Board 12t13 2 chief of staff b{lp Purpose: To secure MTA Board adoption of the MTA Headquarters 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan for Discussion: The 2018 Final Proposed Budget, which is consistent with information presented to the Board in November, provides sufficient funding to maintain MTA Headquarters' operations, which includes Policy and Oversight, Consolidated Functions, the Business Service Center (BSC), and MTA Security, including the MTA Police Department. MTA Headquarters continues to provide funding for new and on-going MTA and Priority lnitiatives including: o Review and re-organize at NYC Transit, which will provide a more responsive organization to issues within the transit system and quicker resolutions to problems;. Manage the work that results from the MTA Genius Challenge; o Grade crossing initiatives at the Commuter Railroads and other safety management projects; o A pilot program to explore the use of new approaches and technology, featuring UWB (Ultra-Wide Band), to significantly accelerate the adoption of Communications Based Train Control throughout the system while reducing cost; and o Enhance MTA Police coverage and command supervision throughout the MTA region November Forecast - Baseline: The 2017 November Forecast Baseline Deficit of $787.7 million includes total Non-Reimbursable Operating Revenues of $54.0 million and total expenses before depreciation and other post-employment benefits of $698.9 million, consisting of $371,9 million in labor expenses and $327.0 million in non-labor expenses. Total end-ofyear non-reimbursable positions are projected to be 2,987 positions. Total Capital and Other Reimbursements are projected to be $121.9 million. Total reimbursable labor expenses are $99.5 million and non-labor expenses are 922l. million, Total end-of-year reimbursable positions are projected to be 139 positions. The Baseline Cash Deficit is projected to be $554.6 million. Total end-of-year positions are projected to be 3,126. II-43

63 Staff Metropolitan Transportation Authorlty Page 2 oí Final Proposed Budset - Baseline: The 2018 Final Proposed Budget Baseline Deficit of $822.7 million includes total Non-Reimbursable Operating Revenues of $58.9 million and total expenses before depreciation and other post-employment benefits of $722.3 million, consisting of $425.0 million in labor expenses and $297.3 million in non-labor expenses. Proposed endof-year non-reimbursable positions are 2,991 positions. Total Capital and Other Reimbursements are projected to be $117.3 million. Total reimbursable labor expenses are $70.7 million and non-labor expenses are $46.6 million. Proposed end-of-year reimbursable positions are 139 positions. The Baseline Cash Deficit is projected to be $660.0 million, Proposed total end-of-year positions are 3,130. Budqet Reduction lnitiative: The November Plan builds on the July Plan BRPs of $21.2 million in 2017 and $17.4 million in 2018, with an additional $7.0 million reduction in 2017 that results from MTA lt savings. lmpact on Fundinq: The 2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan , which are presented in the attached tables, are consistent with the proposed MTA Financial Plan. Recommendation(s): It is recommended that the MTA Board adopt the 2017 November Forecast, the 2018 Final Proposed Budget and the Four-Year Financial Plan for for MTA Headquarters. II-44

64 MTA HEADQUARTERS November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue: Rental Income Advertising Other Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead (68.884) (85.889) (58.898) (54.614) (55.584) (56.601) Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $5.958 $6.399 $7.837 $7.607 $7.968 $8.308 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses MTA Internal Subsidy Other Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $ $ $ $ $ $ Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (1.646) Environmental Remediation Total Expenses $ $ $ $ $ $ Net Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) II-45

65 MTA HEADQUARTERS November Financial Plan Accrual Statement of Operations By Category ($ in millions) Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $4.115 $5.066 $6.238 $6.341 $6.449 $6.555 Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses MTA Internal Subsidy Other Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Deprecation $ $ $ $ $ $ Net Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-46

66 MTA HEADQUARTERS November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable / Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue: Rental Income Advertising Other Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $5.958 $6.399 $7.837 $7.607 $7.968 $8.308 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses MTA Internal Subsidy Other Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $ $ $ $ $ $ Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (1.646) Environmental Remediation Total Expenses $ $ $ $ $ $1, Net Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) II-47

67 MTA HEADQUARTERS November Financial Plan Cash Receipts and Expenditures ($ in millions) Cash Receipts and Expenditures Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue: Rental Income Advertising Revenue Other Revenue Other Operating Revenue Capital and Other Reimbursements Total Receipts $ $ $ $ $ $ Expenditures Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $ $ $ $ $ $ Non-Labor: Electric Power $4.903 $7.551 $7.837 $7.607 $7.968 $8.308 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses: MTA Internal Subsidy Other Other Business Expenses Total Non-Labor Expenditures $ $ $ $ $ $ Other Expenditure Adjustments: Operating Capital Total Other Expenditure Adjustments $ $ $ $ $ $ Total Expenditures $ $ $ $ $ $ Net Cash Balance ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) II-48

68 MTA HEADQUARTERS November Financial Plan Cash Conversion (Cash Flow Adjustments) ($ in millions) Cash Flow Adjustments Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Rent and Utilities (0.350) Advertising Other Revenue (4.225) (0.449) Other Operating Revenue Capital and Other Reimbursements (13.548) Total Receipts $ $ $ $ $ $ Expenditures Labor: Payroll $7.053 $9.298 $6.500 $6.500 $6.500 $6.500 Overtime Health and Welfare OPEB Current Payments (4.876) Pension (0.113) Other Fringe Benefits (5.289) Contribution to GASB Fund (0.238) (0.301) (0.441) (0.587) Reimbursable Overhead (0.001) Total Labor Expenditures ($3.175) $ $9.973 $9.487 $9.334 $8.789 Non-Labor: Electric Power $1.055 ($1.151) $0.000 $0.000 $0.000 Fuel (0.093) (0.017) Insurance (2.193) (0.293) Claims (1.697) Paratransit Service Contracts Maintenance and Other Operating Contracts (0.669) Professional Services Contracts (4.003) (0.709) Materials and Supplies Other Business Expenses MTA Internal Subsidy Other Business Expenses (11.777) (7.016) (4.234) (3.678) Total Other Business Expenses (11.777) (7.016) (4.234) (3.678) Total Non-Labor Expenditures $ ($13.150) ($3.461) $5.249 $9.309 $8.912 Other Expenditure Adjustments: Operating Capital (70.169) (58.344) ( ) (67.520) (90.662) (82.838) Total Other Expenditure Ajustments ($70.169) ($58.344) ($ ) ($67.520) ($90.662) ($82.838) Total Expenditures ($39.828) ($58.599) ($ ) ($52.784) ($72.019) ($65.137) Total Cash Conversion Adjustments before Depreciation $ $ $3.424 $ $ $ Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (1.646) Environmental Remediation Total Cash Conversion Adjustments $ $ $ $ $ $ II-49

69 MTA HEADQUARTERS November Financial Plan Budget Reduction Summary ($ in millions) Favorable/(Unfavorable) Administration Pos Pos Pos Pos Pos Reduction in BSC training costs (Nov Plan) MTA IT (Nov Plan) EAM Contingency (July Plan) Vacancy Savings (July Plan) Marketing Headcount Reduction (July Plan) Real Estate Headcount Reduction (July Plan) Subtotal Administration Customer Convenience/Amenities None Subtotal Customer Convenience/Amenities Service/Service Support None Sub-Total Service/Service Support Maintenance/Operations IT Reduced Maintenance (July Plan) Subtotal Maintenance Revenue Enhancement Transit Museum Additional Revenue (July Plan) Subtotal Revenue Enhancement Safety/ Security MTA PD - Higher Tower Revenue (July Plan) MTA PD - Other Expense Reductions (July Plan) MTA PD - Headcount Reduction (July Plan) Subtotal Safety Enterprise Asset Management None Sub-Total Enterprise Asset Management All Other HQ Expense Reduction (July Plan) Subtotal Other Agency Submission II-50

70 MTA HEADQUARTERS November Financial Plan Total Positions by Function and Department Non-Reimbursable/Reimbursable and Full-Time/Full-Time Equivalents 2016 Actual 2017 November Forecast 2018 Final Proposed Budget Administration Office of Chairman Govt Affairs & Community Relat Agency Operations & Initiative Chief Safety Officer Office of Counselor to the Chairman Office of Chief of Staff Federal Affairs Intergovernmental Relations Spec. Project Develop/Planning Corporate Account Human Resources PCAC Chief Operating Officer Chief Operating Officer New Fare Payment System Chief Operating Officer Labor Relations Office of Labor Relations Labor Relations General Counsel Office of Ded General Counsel Record Management General Counsel Office of Diversity Office of Diversity Office of Civil Rights Office of Diversity Corporate & Internal Communications Office of DED Corp. Affairs and Comm Marketing Corporate & Internal Communications Chief Financial Officer Office of Chief Financial Officer Comptroller's Office Management & Budget Strategic Initiatives Chief Financial Officer Capital Programs Environmental, Sustainability & Compliance Capital Programs II-51

71 MTA HEADQUARTERS November Financial Plan Total Positions by Function and Department Non-Reimbursable/Reimbursable and Full-Time/Full-Time Equivalents 2016 Actual 2017 November Forecast 2018 Final Proposed Budget Total MTA HQ, Policy & Oversight MTA Consolidated Functions External Communication Audit Office of Diversity - MWDBE/ DBE Contract Inte Pensions Occupational Health & Safety Chief Operating Officer Procurement Information Technology 911 1,131 1,135 1,139 1,139 1,133 Chief Operating Officer 911 1,235 1,239 1,243 1,243 1,237 General Counsel/Compliance Compliance Chief Financial Officer Director of Finance Treasury Risk and Insurance Management Real Estate Chief Financial Officer Capital Programs Office of Capital Programs Construction Oversight Federal Policy Enterprise Asset Management Capital Program Management Capital Program Funding Total Capital Programs Corporate and Internal Communications Internal Communications Arts for Transit Transit Museum Operations Retail Operations Corporate and Internal Communications Total MTA Consolidated Functions 1,255 1,664 1,668 1,672 1,672 1,666 Business Service Center Total Administration Positions 1,762 2,244 2,248 2,251 2,251 2,245 Public Safety Baseline Total Positions 2,517 3,126 3,130 3,153 3,207 3,217 Non-Reimbursable 2,378 2,987 2,991 3,014 3,068 3,078 Reimbursable Full-Time 2,517 3,126 3,130 3,153 3,207 3,217 Full-Time Equivalents II-52

72 MTA HEADQUARTERS November Financial Plan Total Positions by Function and Occupational Group Non-Reimbursable and Reimbursable Total_Headcount_Reporting Final November Proposed Forecast Actual Budget FUNCTION / OCCUPATIONAL GROUP Administration Managers/Supervisors Professional/Technical/Clerical 1,345 1,741 1,745 1,748 1,748 1,745 Operational Hourlies Operations Total Administration Headcount 1,762 2,244 2,248 2,251 2,251 2,245 Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Maintenance Total Operations Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Engineering / Capital Total Maintenance Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Public Safety Total Engineering Headcount Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Positions Total Public Safety Headcount Managers/Supervisors Professional, Technical, Clerical 1,407 1,821 1,825 1,828 1,829 1,826 Operational Hourlies Total Positions 2,517 3,126 3,130 3,153 3,207 3,217 II-53

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74 Inspector General

75 Staff Summary Subject: MTA lg 2018 Budget and Financial Plan Adoption Department MTA lnspector General Department Head Name Barrv L. Kluqer o"%x''nff)3ú Project Manage/Divisionfgld \ Date December 4,2017 Vendor Name Contract Number Contract Manager Name Table of Contents Ref # Metropolitan Transportatlon Office of the lnspector General Board Action lnternal Approvals Order To Date Approval lnfo other I I order Aoproval Order Aporoval, Finance Comm. X I 2 Board X I ll Purpose: To secure MTA Board adoption of the MTA Inspector General's 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan for Discussion: The 2018 Final Proposed Budget provides sufficient funding to maintain the MTA lnspector General's operat ons 2017 November Forecast - Baseline Total Capital and Other Reimbursements are projected to be $12.6 million. Total reimbursable labor expenses are $9.5 million and non-labor expenses are $3.1 million Final Proposed Budqet - Baseline Total Capital and Other Reimbursements are projected to be $14.2 million. Total reimbursable labor expenses are $10.9 million and non-labor expenses are $3.3 million. lmpact on Fundinq The 2017 November Forecast, the 2018 Final Proposed Budget and the Four-Year Financial Plan , which are presented in the attached tables, are consistent with the proposed MTA Financial Plan. Recommendation: It is recommended that the MTA Board adopt the 2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan for for the MTA lnspector General. II-55

76 MTA INSPECTOR GENERAL November Financial Plan Accrual Statement of Operations by Category ($ in millions) REIMBURSABLE November Final Proposed Actual Forecast Budget Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Toll Revenue Other Operating Revenue Capital and Other Reimbursements Total Revenue $ $ $ $ $ $ Expenses Labor: Payroll $6.934 $7.309 $8.421 $8.590 $8.762 $8.937 Overtime Health and Welfare OPEB Current Payment Pensions Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $9.351 $9.484 $ $ $ $ Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Service Contracts Materials & Supplies Other Business Expenses Total Non-Labor Expenses $2.906 $3.084 $3.265 $3.333 $3.429 $3.521 Other Expenses Adjustments: Other $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses before Depreciation $ $ $ $ $ $ Depreciation $0.000 $0.000 $0.000 Total Expenses $ $ $ $ $ $ Net Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-56

77 MTA INSPECTOR GENERAL November Financial Plan Cash Receipts & Expenditures ($ in millions) CASH RECEIPTS AND EXPENDITURES November Final Proposed Actual Forecast Budget Receipts Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Vehicle Toll Revenue Other Operating Revenue Capital and Other Reimbursements Total Receipts $ $ $ $ $ $ Expenditures Labor: Payroll $6.934 $7.309 $8.421 $8.590 $8.762 $8.937 Overtime Health and Welfare OPEB Current Payment Pensions Other Fringe Benefits GASB Account Reimbursable Overhead Total Labor Expenditures $9.351 $9.484 $ $ $ $ Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Service Contracts Materials & Supplies Other Business Expenses Total Non-Labor Expenditures $2.906 $3.084 $3.265 $3.333 $3.429 $3.521 Other Expenditure Adjustments: Other - Operating Capital $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditure Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures $ $ $ $ $ $ Net Cash Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-57

78 MTA INSPECTOR GENERAL November Financial Plan Cash Conversion (Cash Flow Adjustments) ($ in millions) CASH FLOW ADJUSTMENTS November Final Proposed Actual Forecast Budget Receipts Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Vehicle Toll Revenue Other Operating Revenue Capital and Other Reimbursements Total Receipts $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Expenditures Labor: Payroll $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Overtime Health and Welfare OPEB Current Payment Pensions Other Fringe Benefits GASB Account Reimbursable Overhead Total Labor Expenditures $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Service Contracts Materials & Supplies Other Business Expenditures Total Non-Labor Expenditures $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Expenditures Adjustments: Other - Operating Capital $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditures Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Cash Conversion Adjustments before Depreciation $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Depreciation $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Cash Conversion Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-58

79 MTA INSPECTOR GENERAL November Financial Plan Total Positions by Function and Department Non-Reimbursable/Reimbursable and Full-Time Positions/Full Time Equivalents 2016 Actual 2017 November Forecast 2018 Final Proposed Budget FUNCTION/DEPARTMENT Administration Office of the Inspector General Total Administration Baseline Total Positions Non-Reimbursable Reimbursable Total Total Full-Time Total Full-Time Equivalents II-59

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81 First Mutual Transportation Assurance Co. (FMTAC)

82 Staff Summary fd ot-oolltan Transportatlon Authorlly Subiect FMTAC 2018 Budget and Financial Plan Adoption Department Risk and lnsurance Management Department Head Name Robert Foran, Chief Éinancial Officer o"ffiffisisnature Project Manager Name Phyllis Rachmuth, Director Risk and lnsurance Mgmt. Board Acfion Order To Date Annroval Info Other 1 Finance Committee x 2 Board X Date November 29,2017 Vendor Name N/A Contract Number N/A Contract Manager Name N/A Table of Contents Ref # N/A lnternal Aoorovals Order Approva Order Approval 1 Risk and lnsr.rfl Manaoement{f E 2 Legal 1,7 I Purpose: To secure MTA Board adoption of the First Mutual Transportation Assurance Company's (FMTAC) 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan for Discussion: FMTAC generates a net cash deficit of zero and has no impact on MTA cash balances. FMTAC cash reserves are separate and distinct from MTA and are necessary to maintain the appropriate capital and reserve levels pursuant to the State of New York lnsurance guidelines. The 2018 Final Proposed Budget, which is consistent with information presented to the Board in November, provides sufficient resources to address the challenges related to insurance and risk management of the MTA. This is accomplished by maximizing the efficiency and flexibility of the insurance programs while minimizing costs to the MTA and its subsidiaries November Forecast-Baseline Total operating revenues are projected at $16.5 million. Total operating expenses are projected to be $18.3 million, resulting in a net deficit of ($1.8) million Final Proposed Budqet-Baseline Total operating revenues are projected at $16.7 million. Total operating expenses are projected to be $14.3 million, resulting in a net surplus of $2.4 million. lmpact of Fundinq: The2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year FinancialPlan20lS-2021, which are presented in the attached tables, are consistent with the proposed MTA Financial Plan. Recommendation: It is recomménded that the MTA Board adopt the 2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan for for the MTA First Mutual Transportation Assurance Company. II-61

83 MTA FIRST MUTUAL TRANSPORTATION ASSURANCE COMPANY November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements Investment Income Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance ( ) ( ) ( ) ( ) ( ) ( ) Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses ($22.960) $ $ $ $0.802 ($11.458) Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. ($22.960) $ $ $ $0.802 ($11.458) Depreciation $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 OPEB Liability Adjustment GASB 68 Pension Expense Adjustment Environmental Remediation Total Expenses ($22.960) $ $ $ $0.802 ($11.458) Net Surplus/(Deficit) $ ($1.850) $2.441 $5.157 $ $ II-62

84 MTA FIRST MUTUAL TRANSPORTATION ASSURANCE COMPANY November Financial Plan Cash Receipts and Expenditures ($ in millions) Cash Receipts and Expenditures Final Actual November Forecast Proposed Budget Receipts Other Operating Revenue $ $ $ $ $ $ Investment Income Total Receipts $ $ $ $ $ $ Expenditures Labor: Payroll $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance ( ) ( ) ( ) ( ) ( ) ( ) Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenditures ($22.960) $6.762 $2.442 ($0.564) ($11.638) ($23.911) Other Expenditure Adjustments: Other $ $9.732 $ $ $ $ Total Other Expenditure Adjustments $ $9.732 $ $ $ $ Total Expenditures $ $ $ $ $ $ Net Cash Balance $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-63

85 MTA FIRST MUTUAL TRANSPORTATION ASSURANCE COMPANY November Financial Plan Cash Conversion (Cash Flow Adjustments) ($ in millions) Cash Flow Adjustments Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements Investment Income Total Receipts $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Expenditures Labor: Payroll $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Non-Labor: Electric Power $0.000 $ $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenditures $0.000 $ $ $ $ $ Other Expenditure Adjustments: Other Expense Adjustments ($35.763) ($9.732) ($14.303) ($17.679) ($29.230) ($41.973) Total Other Expenditure Ajustments ($35.763) ($9.732) ($14.303) ($17.679) ($29.230) ($41.973) Total Expenditures ($35.763) $1.850 ($2.441) ($5.157) ($16.790) ($29.520) Total Cash Conversion Adjustments before Depreciation ($35.763) $1.850 ($2.441) ($5.157) ($16.790) ($29.520) Depreciation $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 OPEB Liability Adjustment GASB 68 Pension Expense Adjustment Environmental Remediation Total Cash Conversion Adjustments ($35.763) $1.850 ($2.441) ($5.157) ($16.790) ($29.520) II-64

86 New York City Transit

87 Staff Summary Suhiect NYCT 2018 Budget and lfinancial Plan Adoption Department Office of Management & Budget Department Head Name Aaron Stern Denartm 1.]dw Proiect Manaser Nãme Date November 30,2017 Vendor Name NA Contract Number NA Contract Manaqer Name NA Table ofcontents *"rr,"ork c ty Translt I of2 Board Action Order To Date Approval Info Other I TA Committee t2/tt/17 X 2 Finance Committee t2/tut'l X J MTA Board t2lt3/17 X Internal Approvals Order Approval Order Approval 1 omb-director /41 1 cfo q:? 5 EvP 7p) 4 President -. lf7 r Hn Purpose To secure MTA Board adoption of MTA New York City Transit's 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan for Discussion MTA New York City Transit's subway system runs 2417 and serves nearly 6 million customers daily. The system operates across 24 lines,665 miles of track, arud 472 stations. The system is I 13 years old and a substantial portion of the basic infrastructure has never been reconstructed; notably, a large proportion of signal equipment was installed more than 50 years ago and has not, to date, been replaced. Ridership has increased dramatically over the years-250 million more riders annually, an increase of l5o/o -- in the past 10 years alone, and most subway lines are operating at peak capacity during rush hour periods. V/hile capital reconstruction has brought significant segments of the system to a state of good repair, the legacy of inadequate capital funding over time is that many parts of the system in operation today are not in a state of good repair. The combined impact of the systems' aging infrastructure, record volume of customers and inadequate funding has resulted in a significant increase in train delays and corresponding deterioration in subway service performance. In response to these urgent problems, Govemor Cuomo declared the subways in a state of emergency and in July, 2017, MTA Chairman Lhota publicly presented a comprehensive plan for subway system recovery and improvement, the Subway Action Plan (SAP). The 2018 Final Proposed Budget, which is consistent with information presented to the Board in November, provides sufficient funding to support MTA New York City Transit's planned service levels, as'well as MTA's commitment to provide safe, reliable and efficient transportation service to the metropolitan New York region. Regarding SAP funding, the Governor has committed to funding one-half of the costs of this program. If new funding commitment for the remaining cost of the program is not forthcoming, the SAP will be scaled back to a sustainable level and the February Plan will be adjusted. The baseline projections that follow for MTA New York City Transit include new programmatic initiatives and support for current projects. NYCT projections do not include the estimated impacts from projected fare increases, unidentified MTA efficiencies, and MTA policy actions. These impacts will be presented as part of MTA consolidated materials. II-65

88 Staff Summa NewYork CityTranslt Primarv Proerammatic Initiative-Subway Action Plan ISAP) Paee 2 of 2 Approximately 2,300 positions are being added to implement the SAP, with annual plan spending projected as follows: $100 millionin2}it, $408 million in 2018, $342 million in20l9, and $301 million in2020 and $301 millionin2}2l. Major areas of focus are as follows: o TracMnfrastructure: Launch an emergency water management initiative; clean track between underground stations; eliminate backlog of track defects, accelerate repairs and install seamless track; increase production capacity and installation of welded rail; improve incident response; augment the number of Combined Action Teams; and increase work train availability. o Signals: Expedite the modernization of 1,300 signals considered to be most problematic. o Power: Support the Power Improvement Plan led by the NYS Public Service Commission, which will ensure reliability and provide a consistent supply of power. o Car Equipment: Expand overhaul capacity; sustain 2417 repair and maintenance shifts; elevate protocol on subway door inspections and repairs; increase number of Emergency Subway Car Response Teams; upgrade subway car interiors; add subway cars and increase ridership capacity. o Stations: Repaint, repair tile, service elevators and escalators, and conduct deep cleaning. o Safety/Communications/Other: Reduce illegal activity in stations; launch public awareness campaign; enhance the Homeless Outreach Program; increase number of dedicated Emergency Medical Technician teams (pilot program); overhaul communication systems.and launch a new integrated MTA app. Budset Reduction Prosram-Projects savings of $56.7 million in20l7, $35.6 million in 2018, $34.3 million in20l9, $43.0 million in2020, and$44.4 million in202l, represented by several savings actions November Forecast-Baseline Total operating revenues are projected at $4.919 billion, including $4.483 billion of farebox revenues. Total operating expenses are projected to be $8.108 billion, consisting of labor costs of billion and nonlabor expenses of $1.S43 billion. Non-cash depreciation expense is projected atsi.778 billion, other postemployment benefit expenses are projected at $1.269 billion, and GASB 68 pension expenses are projected as a credit of $0.296 billion. After including favorable cash adjustments of $3.006 billion, the projected net cash deficit is $2.934 billion. Projected reimbursable expenses of $l.358 billion are fully offset by capital reimbursements. Total end-of-year positions are projected at 50,354, including 44,752 non-reimbursable positions and 5,602 reimbursable positions Final Proposed Budset-Baseline Total operating revenues are projected at $4.995 billion, including farebox revenues of $4.550 billion. Total operating expenses are projected to be $8.659 billion, consisting of labor costs of billion and nonlabor expenses of $1.9S9 billion. Non-cash depreciation expense is projected at $1.828 billion, other postemployment benefit expenses are projected at $1.350 billion, and GASB 68 pension expenses are projected as a credit $0.306 billion. After including favorable cash adjustments of $3.157 billion, the projected net cash deficit is $3.379 billion. Projected reimbursable expenses of $1.301 billion are fully offset by capital reimbursements. Total end-of-year positions are projected at 51,607, including 46,316 non-reimbursable positions and 5,29 1 reimbursable positions. Impact on Funding The 2017 November Forecast, the 2018 Final Proposed Budget and the Four-Year Financial Plan for , which are presented in the attached tables, are consistent with the proposed MTA Financial Plan. Recommendation It is recommended that the MTA Board adopt the2017 November Forecast, the 2018 Final Proposed Budget and the Four-Year Financial Plan for for MTA New York City Transit and the related authorization to draw down Transit Adjudication Bureau (TAB) receipts and interest consistent with this Final Proposed Budget. II-66

89 MTA NEW YORK CITY TRANSIT November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue: Subway $3, $3, $3, $3, $3, $3, Bus Paratransit Fare Media Liability Farebox Revenue $4, $4, $4, $4, $4, $4, Other Operating Revenue: Fare Reimbursement Paratransit Reimbursement Other Other Operating Revenue $ $ $ $ $ $ Capital and Other Reimbursements Total Revenues $4, $4, $4, $5, $5, $5, Operating Expense Labor: Payroll $3, $3, $3, $3, $3, $3, Overtime Total Salaries and Wages $3, $3, $4, $4, $4, $4, Health and Welfare , , , OPEB Current Payments Pension Other Fringe Benefits Total Fringe Benefts $2, $2, $2, $3, $3, $3, Reimbursable Overhead ( ) ( ) ( ) ( ) ( ) ( ) Total Labor Expenses $6, $6, $6, $6, $7, $7, Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $1, $1, $1, $1, $2, $2, Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $7, $8, $8, $8, $9, $9, Depreciation $1, $1, $1, $1, $1, $1, OPEB Liability Adjustment 1, , , , , , GASB 68 Pension Expense Adjustment ( ) ( ) ( ) ( ) ( ) ( ) Environmental Remediation Total Expenses $10, $10, $11, $11, $12, $12, Net Surplus/(Deficit) ($5, ) ($5, ) ($6, ) ($6, ) ($7, ) ($7, ) II-67

90 MTA NEW YORK CITY TRANSIT November Financial Plan Accrual Statement of Operations By Category ($ in millions) Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements 1, , , , , , Total Revenues $1, $1, $1, $1, $1, $1, Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Total Salaries and Wages $ $ $ $ $ $ Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Total Fringe Benefts $ $ $ $ $ $ Reimbursable Overhead Total Labor Expenses $1, $1, $1, $1, $1, $1, Non-Labor: Electric Power $0.549 $0.252 $0.252 $0.252 $0.252 $0.252 Fuel (0.023) (0.023) (0.023) Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses (0.442) (0.442) (0.442) (0.442) Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Deprecation $1, $1, $1, $1, $1, $1, Net Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-68

91 MTA NEW YORK CITY TRANSIT November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable / Reimbursable Actual November Forecast Final Proposed Budget Operating Revenue Farebox Revenue: Subway $3, $3, $3, $3, $3, $3, Bus Paratransit Fare Media Liability Farebox Revenue $4, $4, $4, $4, $4, $4, Other Operating Revenue: Fare Reimbursement Paratransit Reimbursement Other Other Operating Revenue $ $ $ $ $ $ Capital and Other Reimbursements 1, , , , , , Total Revenues $6, $6, $6, $6, $6, $6, Operating Expense Labor: Payroll $3, $3, $4, $4, $4, $4, Overtime Total Salaries and Wages $4, $4, $4, $4, $4, $4, Health and Welfare , , , OPEB Current Payments Pension 1, , , , Other Fringe Benefits Total Fringe Benefts $3, $2, $3, $3, $3, $3, Reimbursable Overhead Total Labor Expenses $7, $7, $7, $8, $8, $8, Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $1, $1, $2, $2, $2, $2, Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $9, $9, $9, $10, $10, $10, Depreciation $1, $1, $1, $1, $1, $1, OPEB Liability Adjustment 1, , , , , , GASB 68 Pension Expense Adjustment ( ) ( ) ( ) ( ) ( ) ( ) Environmental Remediation Total Expenses $11, $12, $12, $13, $13, $13, Net Surplus/(Deficit) ($5, ) ($5, ) ($6, ) ($6, ) ($7, ) ($7, ) II-69

92 MTA NEW YORK CITY TRANSIT November Financial Plan Cash Receipts and Expenditures ($ in millions) Cash Receipts and Expenditures Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $4, $4, $4, $4, $4, $4, Other Operating Revenue: Fare Reimbursement Paratransit Reimbursement Other Revenue Other Operating Revenue Capital and Other Reimbursements 1, , , , , , Total Receipts $5, $6, $6, $6, $6, $6, Expenditures Labor: Payroll $3, $3, $4, $4, $4, $4, Overtime Total Salaries & Wages $4, $4, $4, $4, $4, $4, Health and Welfare , , , OPEB Current Payments Pension 1, , , , Other Fringe Benefits Total Fringe Benefits $2, $2, $2, $3, $3, $3, Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $6, $7, $7, $7, $7, $8, Non-Labor: Electric Power $ $ $ $ $ $ Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenditures $1, $1, $2, $2, $2, $2, Other Expenditure Adjustments: Other $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditure Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures $8, $9, $9, $9, $10, $10, Net Cash Balance ($2, ) ($2, ) ($3, ) ($3, ) ($3, ) ($4, ) II-70

93 MTA NEW YORK CITY TRANSIT November Financial Plan Cash Conversion (Cash Flow Adjustments) ($ in millions) Cash Flow Adjustments Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $ $ $0.200 $0.200 $0.200 $0.200 Other Operating Revenue: Fare Reimbursement (43.766) Paratransit Reimbursement (3.280) (0.119) (0.094) (0.082) (0.117) Other Revenue ( ) ( ) ( ) ( ) ( ) ( ) Other Operating Revenue ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) Capital and Other Reimbursements ( ) (0.707) Total Receipts ($ ) ($56.996) ($34.723) ($67.761) ($92.365) ($ ) Expenditures Labor: Payroll $ $ $ $ $ $ Overtime Total Salaries and Wages $ $ $ $ $ $ Health and Welfare OPEB Current Payments Pension (0.162) Other Fringe Benefits Total Fringe Benefits $ $ $ $ $ $ Contribution to GASB Fund (6.296) (15.785) (25.976) (37.101) Reimbursable Overhead Total Labor Expenditures $ $ $ $ $ $ Non-Labor: Electric Power $0.662 $ $0.000 $0.000 $0.000 Fuel Insurance (2.023) (0.460) Claims Paratransit Service Contracts (0.323) Maintenance and Other Operating Contracts (1.009) (19.100) (8.930) (8.930) (8.930) (8.930) Professional Services Contracts (0.503) Materials and Supplies Other Business Expenses Total Non-Labor Expenditures $ $ $ $ $ $ Other Expenditure Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditure Ajustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures $ $ $ $ $ $ Total Cash Conversion Adjustments before Depreciation $ $ $ $ $ $ Depreciation $1, $1, $1, $1, $1, $1, OPEB Liability Adjustment 1, , , , , , GASB 68 Pension Expense Adjustment ( ) ( ) ( ) ( ) ( ) ( ) Environmental Remediation Total Cash Conversion Adjustments $2, $3, $3, $3, $3, $3, II-71

94 MTA NEW YORK CITY TRANSIT November Financial Plan Ridership (Utilization) (in millions) Actual November Forecast Final Proposed Budget RIDERSHIP Subway 1, , , , , , Bus Paratransit Total Ridership 2, , , , , , FAREBOX REVENUE (Excluding fare media liability) Subway $3, $3, $3, $3, $3, $3, Bus Paratransit Total Revenue $4, $4, $4, $4, $4, $4, II-72

95 NEW YORK CITY TRANSIT November Financial Plan Budget Reduction Plan Summary ($ in millions) Favorable/(Unfavorable) Administration Pos Pos Pos Pos Pos Additional Transit Adjudication Bureau Revenue (July Plan) Administrative & OTPS Savings (July Plan) Cancel BRP -Paratransit Zero Fare Revenue (July Plan) (2.100) (3.600) (3.600) (3.600) (3.600) EAM Adjustments (July Plan) Health & Welfare-Medical Rebid (July Plan) Health & Welfare-NYSHIP DEVA (July Plan) Mandated Training (July Plan) None Subtotal Administration % of Total Proposed 55.2% 36.7% 36.2% 31.0% 31.4% Customer Convenience/Amenities None Subtotal Customer Convenience/Amenities % of Total Proposed 0.0% 0.0% 0.0% 0.0% 0.0% Maintenance Power Maintainer Vacancies (July Plan) Maintenance Material and Contract Savings (July Plan) Subtotal Maintenance % of Total Proposed 6.5% 13.7% 12.7% 10.1% 9.8% Revenue Enhancement Revenue Control Efficiencies (July Plan) Subtotal Revenue Enhancement % of Total Proposed 1.5% 2.7% 2.8% 2.2% 2.1% Safety None Subtotal Safety % of Total Proposed 0.0% 0.0% 0.0% 0.0% 0.0% Security EAGLE TEAM Deployment (July Plan) Subtotal Security % of Total Proposed 6.6% 18.9% 19.6% 15.6% 15.1% Service Bus Operator Hours of Service/OT Adjustments (July Plan) Cancel BRP - Destaff Auxillary Full-time Booth (July Plan) (42) (2.329) (42) (3.879) (42) (3.879) (42) (3.879) (42) (3.879) Paratransit Shift Trips to Voucher/Taxi/E-Hail Prov. (July Plan) Tower Operator Economy (July Plan) None Subtotal Service % of Total Proposed 7.2% 18.2% 17.9% 31.7% 31.9% Service Support None - (0.001) Subtotal Service Support - (0.001) % of Total Proposed 0.0% 0.0% 0.0% 0.0% 0.0% Other Prescription Benefit Management - Additional Savings (Nov. Plan) Subtotal All Other % of Total Proposed 23.0% 9.8% 10.9% 9.3% 9.7% Agency Submission 151 $ $ $ $ $ II-73

96 MTA New York City Transit November Financial Plan Total Positions by Function and Department Non-Reimbursable/Reimbursable and Full-Time/Full-Time Equivalents 2016 Actual 2017 November Forecast 2018 Final Proposed Budget Administration Office of the President Law Office of the EVP Human Resources Office of Management and Budget Capital Planning & Budget Corporate Communications Non-Departmental 1 (32) (24) (24) (24) (24) Labor Relations Materiel Controller Total Administration 1,431 1,434 1,475 1,462 1,425 1,425 Operations Subways Service Delivery 8,540 8,856 8,944 8,795 8,671 8,603 Subways Operation Support /Admin Subways Stations 2,617 2,638 2,871 2,871 2,871 2,871 Subtotal - Subways 11,561 11,897 12,218 12,069 11,945 11,877 Buses 10,982 11,142 10,991 10,991 10,991 10,991 Paratransit Operations Planning Revenue Control Non-Departmental Total Operations 23,672 24,231 24,404 24,251 24,120 24,052 Maintenance Subways Operation Support /Admin Subways Engineering Subways Car Equipment 4,436 4,655 4,946 4,903 4,985 4,863 Subways Infrastructure 1,542 1,749 1,680 1,671 1,654 1,654 Subways Elevator & Escalators Subways Stations 3,723 3,985 4,372 4,364 4,286 4,291 Subways Track 2,836 3,079 3,365 3,414 3,275 3,257 Subways Power Subways Signals 1,482 1,648 1,701 1,677 1,629 1,629 Subways Electronics Maintenance 1,562 1,681 1,642 1,604 1,585 1,585 Subtotal - Subways 17,107 18,433 19,426 19,277 19,001 18,910 Buses 3,671 3,680 3,679 3,804 3,818 3,730 Supply Logistics System Safety Non-Departmental 17 (108) (64) (42) (42) (42) Total Maintenance 21,447 22,677 23,710 23,708 23,443 23,264 Engineering/Capital Capital Program Management 1,398 1,358 1,358 1,358 1,283 1,283 Total Engineering/Capital 1,398 1,358 1,358 1,358 1,283 1,283 Public Safety Security Total Public Safety Total Baseline Positions 48,611 50,354 51,607 51,439 50,931 50,684 Non-Reimbursable 44,256 44,752 46,316 46,442 46,392 46,232 Reimbursable 4,355 5,602 5,291 4,997 4,539 4,452 Total Full-Time 48,355 50,152 51,405 51,237 50,729 50,482 Total Full-Time Equivalents II-74

97 MTA NEW YORK CITY TRANSIT November Financial Plan Total Positions by Function and Occupational Group Non-Reimbursable and Reimbursable Total_Headcount_Reporting Final November Proposed Forecast Actual Budget FUNCTION / OCCUPATIONAL GROUP Administration Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Operations Total Administration Headcount 1,433 1,434 1,475 1,462 1,425 1,425 Managers/Supervisors 2,725 2,866 2,851 2,829 2,809 2,806 Professional/Technical/Clerical Operational Hourlies 20,461 20,857 21,047 20,916 20,808 20,743 Maintenance Total Operations Headcount 23,672 24,231 24,404 24,251 24,120 24,052 Managers/Supervisors 3,914 4,073 4,289 4,238 4,188 4,171 Professional/Technical/Clerical 1,034 1,153 1,205 1,181 1,120 1,107 Operational Hourlies 16,498 17,451 18,216 18,289 18,135 17,986 Engineering / Capital Total Maintenance Headcount 21,446 22,677 23,710 23,708 23,443 23,264 Managers/Supervisors Professional/Technical/Clerical 1,057 1,017 1,017 1, Operational Hourlies Public Safety Total Engineering Headcount 1,398 1,358 1,358 1,358 1,283 1,283 Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Positions Total Public Safety Headcount Managers/Supervisors 7,707 8,062 8,277 8,201 8,056 8,036 Professional, Technical, Clerical 3,573 3,617 3,699 3,665 3,564 3,551 Operational Hourlies 37,331 38,675 39,631 39,573 39,311 39,097 Total Positions 48,611 50,354 51,607 51,439 50,931 50,684 II-75

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99 MTA Bus Company

100 Staff Summary Subiect MTA Bus 2018 Budget and Financial Plan Adoption DepNrtment Finance Department Head Name "*rffr"* Craigggriañ -/'- PròleúTMan -ger Name Jacqueline Bruce Date December 1,2017 Vendor Name NA Contract Numbcr NA Contract Mânåger Name NA Table ofcontents tr" company I of 3 Board Action Order To Dâte Approval Info Other 1 NYCT/MTA Bus t2/11/17 2 Finance Committee 12t1117 X Internal Approvals Order Approval Order.{onroval I EVP, Business Strategies & Operations Support,Ø tzlút1 2 President / Nphlfl J \4TA Boud 12/13t17 X Purpose To secure MTA Board adoption of MTA Bus Company's2017 November Forecast,20l8 Final Proposed Budget, and the Four-Year Financial Plan for Discussion The 2018 Final Proposed Budget, which is consistent with information presented to the Board in November, provides sufficient funding to support MTA Bus Company's planned service levels, as well as MTA's commitment to provide safe, secure, reliable, and cost efficient transportation service to the metropolitan New York region. The baseline projections that follow for MTA Bus Company include the impact of budget reduction initiatives and exclude certain items that are captured "below-the-line'o in the MTA Consolidated Financial Plan: Fare/Toll increases, unidentified MTA Efficiencies, and other MTA policy actions. The MTA is reimbursed from the City of New York for the operating deficits of MTA Bus Company (MTABC). The 2018 Final Proposed Budget includes funding for new and enhanced investments and initiatives in support of our core transit goals as follows: Kev Prosrammatic Initiatives a a Articulated Buses on Loan from NYCT: Forty articulated buses are being loaned for 18 to 24 months by NYCT to MTABC to operate the Q52/53 SBS service. As a result, NYCT will be retaining older articulated buses (2003) to replace the buses being loaned. The incremental costs associated with the older articulated fleet will be charged to MTABC along with a monthly lease fee. Traffic Signal Priorit), (TSP): This project will encompass all activities required to test, and rollout the TSP. TSP improves bus service by facilitating the movement of buses through traffic signal controlled intersections. The TSP system generates messages from the bus requesting signal priority that are sent to the NYC-DOT Traffic Management Center. II-77

101 Staff Summa Bus Company a Platform Budget - TWU Contract Agreement: Additional cost associated with the 2017 TWU Contract agreement to have a unified collective bargaining agreement utilizing College Point depot's work rules as a guideline. Platform Budget - Normal Service: The MTABC Bus operator platform budget addresses the following platform budget adjustments: Outdated running times, efforts to improve wait assessment, frequency improvements, Ql03 Route Extension, and savings to be realized once Far Rockaway depot is assigned articulated buses. NYC-DOT Contract: A MOU with NYC-DOT was signed and renewed late in 2016 for the maintenance of bus stops, bus stop markerso and the movement of bus stops. NYCT and MTABC share the cost of the contract proportionately; the MOU covers a retroactive payment going back to 20lI and extends the agreement through a Overage Fleet: There are no new bus deliveries scheduled for MTABC until the 4th Quarter of This will result in a large part of the fleet being overage, a situation that is not expected to improve until the end of At the end of 2017, approximately 258 buses (25%o of the fleet), will be over 12 years of age. By the end of 2018 this number will increase to approximately 600 buses or 50% of the fleet. This request covers the additional maintenance hours required to keep overage buses in service. Budeet Reduction Initiatives The Plan provides overall savings of $21.0 million through 2021, comprised of annual savings of $6.6 million (2017), $4.5 million (2018), $3.5 million (2019), $3.2 million (2020), and $3.2 million (2021). These savings are driven mainly by four budget reduction initiatives discussed below. a OTPS BRP: OTPS savings are based on a continued top down review of controllable non-labor categories, specifically Material and Supplies, Professional Service Contract, and Other Business Expenses that results in recurring savings.. Facility Maintainers: Facilities will not be able to fill maintenance positions ùntil 2019, resulting in savings. o Bus Operator Relief: Savings from Bus Operator relief reduction. o Shop Scopes Reliability Maintenance: Labor and material savings due to scope reductions for transformer, wiper motor/starter, and starting batteries replacement November Forecast - Baseline Total operating revenues are projected at million, including $215.6 million of farebox revenues. Total non-reimbursable expenses before depreciation and GASB adjustments are projected to be million in2017, consisting of labor costs of $551.8 million and non-labor expenses of $175.3 million. Noncash depreciation expense is projected at $53.9 million, other post-employment beneht expenses are projected at $100.2 million, and GASB 68 Pension Expense Adjustment is projected at $114.6 million. Projected reimbursable expenses of $5.9 million are fully ofßet by capital reimbursements. After Cash Flow Adjustments, the projected net cash deficit is $481.1 million. Total end-of-year positions are projected at 3,952, consisting of 3,912 non-reimbursable positions and 40 reimbursable positions. II-78

102 Staff Summa Bus Company 2018 Final Proposed Budset - Baseline Total operating revenues are budgeted at $239.6 million, including farebox revenues of $219.0 million. Total non-reimbursable expenses before depreciation and GASB adjustments are budgeted to be $773.0 million in 2018, consisting of labor costs of $571.3 million and non-labor expenses of $201.7 million. Noncash depreciation expense is projected at $54.3 million, other post-employment benefit expenses are projected at $100.2 million, and GASB 68 Pension Expense Adjustment is projected at $45.6 million. Projected reimbursable expenses of $6.0 million are fully ofßet by capital reimbursements. After Cash Flow Adjustments, the projected net cash defìcit is $509.4 million. Total end-oêyear positions are projecte d at 3,984 consisting of 3,944 non-reimbursable positions and 40 reimbursable positions. Impact on Funding The 2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan for , which are presented in the attached tables, are consistent with the proposed MTA financial plan. Recommendation It is recommended that the MTA Board adopt the 2017 November Forecast, the 2018 Final Proposed Budget, and the Four-Year Financial Plan for for MTA Bus Company. II-79

103 MTA BUS COMPANY November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Farebox Revenue $ $ $ $ $ $ Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead (1.450) Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $1.542 $1.916 $2.162 $2.203 $2.338 $2.469 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $ $ $ $ $ $ Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (5.686) Environmental Remediation Total Expenses $ $ $ $ $ $ Net Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) II-80

104 MTA BUS COMPANY November Financial Plan Accrual Statement of Operations By Category ($ in millions) Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Farebox Revenue $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue Capital and Other Reimbursements Total Revenues $4.258 $5.857 $5.960 $5.925 $5.871 $5.966 Operating Expense Labor: Payroll $2.612 $2.682 $2.731 $2.586 $2.430 $2.395 Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead Total Labor Expenses $4.144 $4.767 $4.855 $4.803 $4.748 $4.832 Non-Labor: Electric Power $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $0.114 $1.090 $1.105 $1.122 $1.123 $1.134 Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Deprecation $4.258 $5.857 $5.960 $5.925 $5.871 $5.966 Net Surplus/(Deficit) $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 II-81

105 MTA BUS COMPANY November Financial Plan Accrual Statement of Operations By Category ($ in millions) Non-Reimbursable / Reimbursable Final Actual November Forecast Proposed Budget Operating Revenue Farebox Revenue $ $ $ $ $ $ Other Operating Revenue Capital and Other Reimbursements Total Revenues $ $ $ $ $ $ Operating Expense Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Reimbursable Overhead (1.450) Total Labor Expenses $ $ $ $ $ $ Non-Labor: Electric Power $1.542 $1.916 $2.162 $2.203 $2.338 $2.469 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenses $ $ $ $ $ $ Other Expense Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenses Before Depreciation and GASB Adjs. $ $ $ $ $ $ Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (5.686) Environmental Remediation Total Expenses $ $1, $ $ $ $ Net Surplus/(Deficit) ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) II-82

106 MTA BUS COMPANY November Financial Plan Cash Receipts and Expenditures ($ in millions) Cash Receipts and Expenditures Final Actual November Forecast Proposed Budget Receipts Farebox Revenue $ $ $ $ $ $ Other Operating Revenue Capital and Other Reimbursements Total Receipts $ $ $ $ $ $ Expenditures Labor: Payroll $ $ $ $ $ $ Overtime Health and Welfare OPEB Current Payments Pension Other Fringe Benefits Contribution to GASB Fund Reimbursable Overhead Total Labor Expenditures $ $ $ $ $ $ Non-Labor: Electric Power $1.542 $1.916 $2.162 $2.203 $2.338 $2.469 Fuel Insurance Claims Paratransit Service Contracts Maintenance and Other Operating Contracts Professional Services Contracts Materials and Supplies Other Business Expenses Total Non-Labor Expenditures $ $ $ $ $ $ Other Expenditure Adjustments: Other $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditure Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures $ $ $ $ $ $ Net Cash Balance ($ ) ($ ) ($ ) ($ ) ($ ) ($ ) II-83

107 MTA BUS COMPANY November Financial Plan Cash Conversion (Cash Flow Adjustments) Favorable/(Unfavorable) ($ in millions) Cash Flow Adjustments Final Actual November Forecast Proposed Budget Receipts Farebox Revenue ($1.033) $1.246 $0.000 $0.000 $0.000 $0.000 Other Operating Revenue (0.288) Capital and Other Reimbursements Total Receipts ($0.674) $3.297 $2.082 $5.383 $5.376 $5.362 Expenditures Labor: Payroll ($6.845) $5.827 $2.079 ($1.379) ($1.538) $0.406 Overtime (0.039) Health and Welfare (0.001) OPEB Current Payments (1.410) Pension Other Fringe Benefits Contribution to GASB Fund (0.094) (0.205) (0.318) Reimbursable Overhead (1.450) Total Labor Expenditures $ $ $ $ $ $ Non-Labor: Electric Power $0.000 $ $0.000 $0.000 $0.000 Fuel (0.001) Insurance (1.357) Claims Paratransit Service Contracts Maintenance and Other Operating Contracts (5.501) Professional Services Contracts (9.500) Materials and Supplies (3.200) (0.001) Other Business Expenses Total Non-Labor Expenditures $ ($14.139) $4.136 $7.046 $7.047 $4.175 Other Expenditure Adjustments: Other Expense Adjustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Other Expenditure Ajustments $0.000 $0.000 $0.000 $0.000 $0.000 $0.000 Total Expenditures $ $5.967 $ $ $ $ Total Cash Conversion Adjustments before Depreciation $ $9.264 $ $ $ $ Depreciation $ $ $ $ $ $ OPEB Liability Adjustment GASB 68 Pension Expense Adjustment (5.686) Environmental Remediation Total Cash Conversion Adjustments $ $ $ $ $ $ II-84

108 MTA BUS COMPANY November Financial Plan Ridership (Utilization) (in millions) Actual November Forecast Final Proposed Budget RIDERSHIP Fixed Route Total Ridership FAREBOX REVENUE Fixed Route Farebox Revenue $ $ $ $ $ $ Farebox Revenue $ $ $ $ $ $ II-85

109 MTA BUS COMPANY November Financial Plan Budget Reduction Plan Summary ($ in millions) Favorable/(Unfavorable) Administration Pos Pos Pos Pos Pos None Subtotal Administration $ $ $0.000 Customer Convenience/Amenities None Subtotal Customer Convenience/Amenities Maintenance BRP - Shop Scope Reliability Maintenance Savings Veeder Root Contract BRP - Facilities Maintainers Subtotal Maintenance Revenue Enhancement None Subtotal Revenue Enhancement Safety None Subtotal Safety Security None Subtotal Security Service Bus Operator Relief Subtotal Service Service Support None Subtotal Service Support Other OTPS Professional Service Contract Material & Supplies Other Business Expense Subtotal Other Agency Submission 23 $ $ $ $ $3.225 II-86

110 MTA BUS COMPANY November Financial Plan Total Positions by Function & Department Non-Reimbursable/Reimbursable and Full-Time/Full-Time Equivalents November Final Proposed FUNCTION/DEPARTMENT Actual Forecast Budget Administration Office of the EVP Human Resources Office of Management and Budget Technology & Information Services Materiel Controller Office of the President System Safety Administration Law Corporate Communications Strategic Office Labor Relations Non Departmental Total Administration Operations Buses 2,237 2,295 2,328 2,328 2,328 2,328 Office of the Executive Vice President, Regional Safety & Training Road Operations Transportation Support Operations Planning Revenue Control Total Operations 2,516 2,562 2,596 2,596 2,596 2,596 Maintenance Buses Maintenance Support/CMF Facilities Supply Logistics Total Maintenance 1,111 1,177 1,175 1,175 1,163 1,199 Engineering/Capital Capital Program Management Public Safety Office of the Senior Vice President Total Positions 3,784 3,952 3,984 4,012 4,005 4,009 Non-Reimbursable 3,748 3,912 3,944 3,972 3,965 3,969 Reimbursable Total Full-Time 3,770 3,937 3,969 3,997 3,990 3,994 Total Full-Time Equivalents II-87

111 MTA BUS COMPANY November Financial Plan Total Positions by Function and Occupational Group Non-Reimbursable and Reimbursable Total_Headcount_Reporting Final November Proposed Forecast Actual Budget FUNCTION / OCCUPATIONAL GROUP Administration Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Operations Total Administration Headcount Managers/Supervisors Professional/Technical/Clerical Operational Hourlies 2,159 2,203 2,235 2,235 2,235 2,235 Maintenance Total Operations Headcount 2,516 2,562 2,596 2,596 2,596 2,596 Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Engineering / Capital Total Maintenance Headcount 1,111 1,177 1,175 1,175 1,163 1,199 Managers/Supervisors Professional/Technical/Clerical Operational Hourlies Public Safety Total Engineering Headcount Managers/Supervisors Professional, Technical, Clerical Operational Hourlies Total Positions Total Public Safety Headcount Managers/Supervisors Professional, Technical, Clerical Operational Hourlies 3,026 3,136 3,158 3,185 3,178 3,184 Total Positions 3,784 3,952 3,984 4,012 4,005 4,009 II-88

112 Staten Island Railway

113 Staff Summary Subiect SIR Budget and Financial Plan Adoption Department Office of Management & Budget Department Head Name Aaron Stern DeDartment YffiY Dâte November 30,2017 Vendor Name NA Contract Number NA Contråct Mansger Name s,","n lsland Railway 1 of2 Proiect Manager Name Table of Contents Ref # Board Action Order To Date Approval Info Other I TA Committee t2lrutt X 2 Finance Committee t2llult X -t MTA Board t2l13lt7 X Internal Approvals Order Approval Order Anoroval I OMB - Director þ4 2 cfo ( f 3 4 President fl t,l+ln Purpose To secure MTA Board adoption of MTA Staten Island Railway's 2017 November Forecast, 2018 Final Proposed Budget, and the Four-Year Financial Plan for I. Discussion The 2018 Final Proposed Budget, which is consistent with information presented to the Board in November, provides sufficient funding to support MTA Staten Island Railway's planned service levels, as well as MTA's commitment to provide safe, reliable and efficient transportation service. The baseline projections that follow for MTA Staten Island Railway include several new programmatic initiatives and support for cutïent projects. SIR projections do not include the estimated impacts from projected fare increases, unidentified MTA efficiencies, and MTA policy actions. These impacts will be presented as part of MTA consolidated materials. Maior Programmatic Initiative: a SIR Mainline Track Component Tie Replacement Program. Based on a SIR-wide assessment of the current condition of track component ties that serye to maintain the stability of track, it has been determined that most of the existing ties need to be replaced, starting with those that are in the most worn condition. To support this important program, 20 maintenance positions are being added from 2017 through the end of 2019.In2019, a further assessment of the status of this program will be undertaken to determine what additional resources/support will be required for subsequent plan years. II-89

114 Staff s,","n lsland Railway 2 of2 Other Important Prosrammatic Initiatives: o Four Dispatcher positions are necessary to staff a new Enhanced Employee Protection System (EEPS) desk at the SIR Rail Control Center to ensure roadway worker protection. This requirement meets an NTSB safety recommendation and will be similar to the system now in place at Metro North Railroad. a Third Rail Upgrade Replacement Plan will modernize third rail in designated locations along the right-of-way to ensure the successful performance of the new R21l car fleet, which is scheduled to replace the current nearly 45 year old R44 car fleet in2022. A Budeet Reduction Initiative included in this financial plan represents additional estimated vacancy savings in each plan year of $0.100 million November F orecast-baseline Total operating revenues are projected ats9.2 million, including farebox revenues of $6.8 million. Total operating expenses are projected to be $75.6 million, consisting of labor costs of $46.8 million and nonlabor expenses of $2S.S million. Non-cash depreciation expense is projected at $8.3 million, other postemployment benefit expenses are projected at $7.5 million and GASB 68 pension expenses are projected at $0.3 million. After including favorable cash adjustments of $13.3 million, the projected net cash deficit is $69.2 million. Projected reimbursable expenses of $2.5 million are fully offset by capital reimbursements. Total end-oêyear positions are projected at 338, including 324 non-reimbursable positions and 14 reimbursable positions X'inal Proposed Budeet-Baseline Total operating revenues are projected at $9.3 million, including farebox revenues of $6.9 million. Total operating expenses are projected to be $60.2 million, consisting of labor costs of $48.1 million and nonlabor expenses of $12.1 million. Non-cash depreciation expense is projected at $8.3 million, other postemployment benefit expenses are projected at $7.5 million, and GASB 68 pension expenses are projected at $0.6 million. After including favorable cash adjustments of $17.9 million, the projected net cash deficit is million. Projected reimbursable expenses of $2.0 million are fully ofßet by capital reimbursements. Total end-of-year positions are projected at 343, including 329 non-reimbursable positions and 14 reimbursable positions. Impact on Fundins The 2017 November Forecast, the 2018 Final Proposed Budget and the Four-Year Financial Plan for , which are presented in the attached tables, are consistent with the proposed MTA Financial Plan. Recommendation It is recommended that the MTA Board adopt the2017 November Forecast, the 2018 Final Proposed Budget and the Four-Year Financial Plan for I for MTA Staten Island Railway. II-90