Memorandum. May 28, Mr. Ken Bleiwas Office of the State Comptroller 59 Maiden Lane, 29 th Floor New York, New York Dear Mr.

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1 Memorandum State of New York May 28, 2014 Mr. Ken Bleiwas Office of the State Comptroller 59 Maiden Lane, 29 th Floor New York, New York Dear Mr. Bleiwas, This represents the MTA s First Quarter, 2014, report concerning the status of its gap closing initiatives as required by the NY State Comptroller s Regulation 4, Section (c). According to the Regulation, the MTA must report each quarter, until implemented or rescinded, the status of each gap-closing initiative with a projected value equal to or greater than $1 million in any given fiscal year, including milestones, impact on staffing, current implementation status, actual savings or revenues to date and projected annual savings or revenues in comparison to Budget and Plan projections. Attached is a summary of the results of the 1st Quarter PEG Monitoring Program for 2014, as well as copies of the PEG Monitoring Milestone Reports. The summary shows that the MTA tracked PEGs/ AABBs and BRPs with an annual value of $190.6 million. Actual 1st Quarter savings of $46.9 million represents 100% of the planned quarterly savings. If you have any questions, please do not hesitate to call. Sincerely, Douglas Johnson Director, Division of Management & Budget cc: T. Prendergast K. DeDonno F. Ferrer J. Patrissi B. Foran K. Leopold N. Griffith L. Liberto (OSDC)

2 Metropolitan Transportation Authority 1st Quarter 2014 Year-To-Date PEG/AABB/BRP Monitoring Summary (Combined PEGs/AABBs/BRPs) ($ in millions) MTA Agencies PEGs/AABBs/BRPs Monitored * (Full Year) "Planned" 1st Quarter Results (ytd) "Realized" Variance Fav/(Unfav) "Realized" as % of "Planned" % of Monitored PEGs/AABBs/BRPs Implemented at end of Quarter Pos ($) ($) ($) ($) ($) ($) New York City Transit (22) % 25.0% Long Island Rail Road N/A 0.0% Metro-North Railroad % 25.0% MTA Bridges & Tunnels N/A N/A MTA Headquarters N/A N/A Long Island Bus N/A N/A Staten Island Rail N/A N/A MTA Bus Company % 25.0% MTA CONSOLIDATED (22) % 24.6% * The value of the monitored PEGs/AABBs/BRPs reflects re-estimates captured through the November 2013 Financial Plan and only includes those PEGs/AABBs/BRPs with an annual value of $1 million or more.

3 MTA Agencies Metropolitan Transportation Authority 1st Quarter 2014 Year-To-Date BRP Monitoring Summary (2014 BRPs) ($ in millions) 2014 BRPs Monitored * (Full Year) "Planned" 1st Quarter Results (ytd) "Realized" Variance Fav/(Unfav) "Realized" as % of "Planned" % of 2014 Monitored BRPs Implemented at end of Quarter Pos ($) ($) ($) ($) ($) ($) New York City Transit * N/A N/A Long Island Rail Road N/A N/A Metro-North Railroad N/A N/A MTA Bridges & Tunnels N/A N/A MTA Headquarters N/A N/A Long Island Bus N/A N/A Staten Island Rail N/A N/A MTA Bus Company N/A N/A MTA CONSOLIDATED % 25.0% * The value of the monitored PEGs/AABBs/BRPs reflects re-estimates captured through the November 2013 Financial Plan and only includes those PEGs/AABBs/BRPs with an annual value of $1 million or more.

4 MTA Agencies Metropolitan Transportation Authority 1st Quarter 2014 Year-To-Date BRP Monitoring Summary (2012 BRPs) ($ in millions) 2012 BRPs Monitored * (Full Year) "Planned" 1st Quarter Results (ytd) "Realized" Variance Fav/(Unfav) "Realized" as % of "Planned" % of 2012 Monitored BRPs Implemented at end of Quarter Pos ($) ($) ($) ($) ($) ($) New York City Transit * (22) % 25.0% Long Island Rail Road N/A N/A Metro-North Railroad N/A N/A MTA Bridges & Tunnels N/A N/A MTA Headquarters N/A N/A Long Island Bus N/A N/A Staten Island Rail N/A N/A MTA Bus Company N/A N/A MTA CONSOLIDATED (22) % 25.0% * The value of the monitored PEGs/AABBs/BRPs reflects re-estimates captured through the November 2013 Financial Plan and only includes those PEGs/AABBs/BRPs with an annual value of $1 million or more.

5 MTA Agencies Metropolitan Transportation Authority 1st Quarter 2014 Year-To-Date PEG/AABB Monitoring Summary (2010 PEGs/AABBs) ($ in millions) 1st Quarter Results (ytd) % of 2010 Monitored 2010 PEGs & "Realized" "Planned" "Realized" Variance PEGs & AABBs AABBs Monitored * as % of Fav/(Unfav) Implemented at end (Full Year) "Planned" of Quarter Pos ($) ($) ($) ($) ($) ($) New York City Transit N/A N/A Long Island Rail Road N/A 0.0% Metro-North Railroad N/A N/A MTA Bridges & Tunnels N/A N/A MTA Headquarters N/A N/A Long Island Bus N/A N/A Staten Island Rail N/A N/A MTA Bus Company N/A N/A MTA CONSOLIDATED #DIV/0! 0.0% * The value of the monitored PEGs/AABBs/BRPs reflects re-estimates captured through the November 2013 Financial Plan and only includes those PEGs/AABBs/BRPs with an annual value of $1 million or more.

6 Metropolitan Transportation Authority 1st Quarter 2014 Year-To-Date (2014 BRPs) ($ in millions) 1st Quarter Results (ytd) "Realized" as % of "Planned" % of 2014 Monitored PEGs/AABBs Implemented at end of 2014 BRPs Monitored * "Planned" "Realized" Variance BRP Tracking # PEG Name (Full-Year 11) Fav/(Unfav) Quarter Pos ($) ($) ($) ($) ($) ($) MNR MNR BRP Revenue Enhancement % 25.0% Total NYCT BRPs % 25.0% MTA Bus MTABus BRP OTPS % 25.0% Total MTBUS BRPs Total MTA BRPs % 25.0% * The value of the monitored PEGs/AABBs/BRPs reflects re-estimates captured through the November 2013 Financial Plan and only includes those PEGs/AABBs/BRPs with an annual value of $1 million or more.

7 Metropolitan Transportation Authority 1st Quarter 2014 Year-To-Date (2012 BRPs) ($ in millions) 1st Quarter Results (ytd) % of 2012 Monitored "Realized" PEGs/AABBs 2012 BRPs Monitored * "Planned" "Realized" Variance as % of "Planned" Implemented at end of (Full-Year 11) Fav/(Unfav) BRP Tracking # PEG Name Quarter Pos ($) ($) ($) ($) ($) ($) NYCT NYCT BRP Paratransit Additonal (22) % 25.0% Total NYCT BRPs (22) % 25.0% Total MTA BRPs (22) % 25.0% * The value of the monitored PEGs/AABBs/BRPs reflects re-estimates captured through the November 2013 Financial Plan and only includes those PEGs/AABBs/BRPs with an annual value of $1 million or more.

8 Metropolitan Transportation Authority 1st Quarter 2014 Year-To-Date PEG/AABB Monitoring Summary (2010 PEGs/AABBs) ($ in millions) 1st Quarter Results (ytd) % of 2010 Monitored 2010 PEGs/AABBs "Realized" PEGs/AABBs "Planned" "Realized" Variance Monitored * as % of "Planned" Implemented at end of Fav/(Unfav) PEG Tracking # PEG Name (Full-Year 10) Quarter Pos ($) ($) ($) ($) ($) ($) LIRR LIRR Air Rights N/A 0.0% Total LIRR PEGs N/A 0.0% Total MTA Consolidated PEGs N/A 0.0% * The value of the monitored PEGs/AABBs/BRPs reflects re-estimates captured through the November 2013 Financial Plan and only includes those PEGs/AABBs/BRPs with an annual value of $1 million or more.

9 Metropolitan Transportation Authority 2014 NYCT BRP Monitoring Program 1st Quarter 2014 Results In 2014, one NYCT BRP is being monitored with a full-year planned savings of $181.6M. Results for the first quarter indicate that $42.4M or 100.0% of the monitored BRP savings for the quarter were realized.

10 MTA New York City Transit 2014 PEG Monitoring Milestone Report Tracking No. 1st Quarter 2014 (Actual Results through March) NYCT BRP PEG Name: PEG Description: Paratransit Additional reflect the annualized impact of 2011 decreased trip activity, continued diversion of trips from higher cost 'Primary' providers to lower cost taxis and vouchers and revised projections of annual trip growth (11% rather than 15% growth). These factors have also favorably affected insurance and fuel costs as the NYCT dedicated fleet is smaller and a larger number of trips are now routed towards taxi/voucher service. are partially offset by reduced fare revenue and the addition of LIB personnel who have been assigned to various Paratransit functions. In addition reduced trip levels have also favorably affected scheduling and eligibility certification costs. This also includes the Paratransit Fare Incentives that replaces expensive paratransit trips with free rides on buses and subways. PEG Status: Costs have met savings projections mainly due to lower completed trips, which also resulted in savings for fuel and insurance. In addition, expenses for call center operations, eligibility certification review and vehicle rehabilitation costs were reduced favorably. PEG VALUE ($ in millions): $ Pos. $ Pos. $ Pos. $ Pos. $ Pos. Original Plan: (22) (24) (22) (22) (22) Planned Revised Actual CRITICAL TASKS & MILESTONES: Date Date Date KEY INDICATORS: Transfer of positions from LIB Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Plan (22) (22) Actual/Proj. (22) (22) Month Var YTD Var MONTHLY CASH SAVINGS ($ in millions) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Plan Actual/Proj Month Var (15.134) (15.134) (15.134) (15.134) (15.134) (15.134) (15.134) (15.134) (15.134) ( ) YTD Var (15.134) (30.268) (45.402) (60.536) (75.670) (90.805) ( ) ( ) ( ) ( ) Frequency of Update to Actuals: PEG Has Been Fully Implemented: Quarterly No

11 Metropolitan Transportation Authority 2014 MTA Bus BRP Monitoring Program 1st Quarter 2014 results In 2014, one MTA Bus BRP is being monitored with a full-year planned savings of $3.8M. Results for the first quarter indicate that $0.9M or 100.0% of the monitored BRP savings for the quarter were realized.

12 MTA Bus Company 2014 BRP Monitoring Milestone Report 1st Quarter (Actuals thru March) Tracking No. MTA Bus BRP BRP Name: BRP Description: OTPS Various items were identified and aligned in the miscellaneous accounts to generate savings in the Maintenance and Other Operating Contracts and Other Business Expense categories. BRP Status: This PEG has been fully implemented through 1st Quarter. BRP VALUE ($ in millions): $ Pos. $ Pos. $ Pos. $ Pos. $ Pos. Original Plan: Jul Modified Plan: Planned Revised Actual CRITICAL TASKS & MILESTONES: Date Date Date 1 Reduce OTPS expenses Jul-13 KEY INDICATORS: MONTHLY CASH SAVINGS ($ in millions) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Plan Actual/Proj Month Var (0.316) (0.316) (0.316) (0.316) (0.316) (0.316) (0.316) (0.316) (0.316) (2.840) YTD Var (0.316) (0.631) (0.947) (1.262) (1.578) (1.894) (2.209) (2.525) (2.840) (2.840) Frequency of Update to Actuals: BRP Has Been Fully Implemented: Quarterly

13 Metropolitan Transportation Authority 2014 MNR BRP Monitoring Program 1st Quarter 2014 results In 2014, one MNR BRP is being monitored with a full-year planned savings of $2.2M. Results for the first quarter indicate that $0.5 or 100.0% of the monitored BRP savings for the quarter were realized.

14 MTA Metro-North Rail Road 2014 BRP Monitoring Milestone Report Tracking No. 1st Quarter 2014 BRP Monitoring Milestone Report MNR BRP PEG Name: PEG Description: Revenue Enhancement Continue favorable growth trend on realization of higher GCT retail revenues and percentage rent receipts, and maintain control on tenant service costs. PEG Status: This PEG is fully implemented through the 1st Quarter PEG VALUE: ($ in millions) $ Pos. $ Pos. $ Pos. $ Pos. $ Pos. Original Plan: Planned Revised Actual CRITICAL TASKS & MILESTONES: Date Date Date Jun-13 Increase Non-Passanger Revenue Jun-13 - Jun-13 KEY INDICATORS: Revenue Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Plan Actual/Proj. - Month Var YTD Var MONTHLY CASH SAVINGS: ($ in millions) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Plan Actual/Proj Month Var YTD Var Frequency of Update to Actuals: PEG Has Been Fully Implemented: Quarterly

15 MTA Long Island Rail Road 2014 PEG Monitoring Milestone Report Tracking No. 1st Quarter 2014 (Actuals through March) LIRR PEG Name: PEG Description: Air Rights Through a formal RFP process, the MTA and LIRR have identified a property owner interested in purchasing air rights over the Rail Road right of way and transferring them to his/her own adjacent property. Negotiations over the purchase price and other consideration are ongoing, but MTA Real Estate estimates the minimum to be $3 million. PEG Status: Currently the Transit Oriented Development (TOD Group) is doing an engineering study & an appraisal for the air rights. They are projecting phase I to go out towards the end of 2013 and phase II in NYCT pushed back the project to utilize its resources for the South Ferry project (based on the damage that Superstorm Sandy caused to South Ferry). PEG VALUE: ($ in millions) $ Pos. $ Pos. $ Pos. $ Pos. $ Pos. Original Plan: Feb Modified Plan: Nov Modified Plan: Nov Modified Plan: Nov Modified Plan: Nov Planned Revised Actual CRITICAL TASKS & MILESTONES: Date Date Date A property owner interested in purchasing the air rights has been identified. Dec-09 Air Rights are purchased. Dec-10 Dec-14 MONTHLY CASH SAVINGS: ($ in millions) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Plan Actual/Proj Month Var YTD Var Frequency of Update to Actuals: PEG Has Been Fully Implemented: Quarterly No

Memorandum. May 29, Mr. Ken Bleiwas Office of the State Comptroller 59 Maiden Lane, 29 th Floor New York, New York Dear Mr.

Memorandum. May 29, Mr. Ken Bleiwas Office of the State Comptroller 59 Maiden Lane, 29 th Floor New York, New York Dear Mr. Memorandum State of New York May 29, 2015 Mr. Ken Bleiwas Office of the State Comptroller 59 Maiden Lane, 29 th Floor New York, New York 10038 Dear Mr. Bleiwas, This represents the MTA s First Quarter,