New York Gov. Kathy Hochul on May 9 signed new legislation as part of the Fiscal Year 2026 Enacted Budget to fully fund the Metropolitan Transportation Authority’s (MTA) $68.4 billion 2025-29 Capital Plan, which includes breaking ground on the Interborough Express (IBX), which will run between Brooklyn and Queens; rehabilitating the Grand Central Artery, a four-mile stretch that carries 98% of all MTA Metro-North Railroad (MNR) service; and improving the overall rider experience.
The investment, MTA reported May 9, also covers:
- The “purchase [of] thousands of new subway and railcars.”
- Modernization of signals “to provide faster, more frequent and more reliable service.”
- Upgrades to maintenance facilities.
- Renewal of electric power systems “to enhance reliability.”
- Repairs to “structurally deficient bridges and tunnels.”
- Delivery of “full ADA-accessibility improvements” at more than 65 subway and railroad stations.
- Safety improvements at stations and across infrastructure systems.
- Installation of modern fare gates at more than 150 stations to prevent fare evasion
- Growth in its zero-emissions bus fleet “to stay on track for a fully-electric fleet by 2040.”
- Increased “resiliency against flooding and protect the Hudson Line against severe weather.”
Specifically for MNR, the MTA’s capital plan will spend $6 billion on rolling stock (completing the replacement of 40-year-old railcars with new, fully accessible M9A trains for use on the Harlem and Hudson lines); station platforms and components (replacing and rehabilitating deteriorating station platforms and other major station components); and climate and weather protection (coordinating investments at the “most vulnerable” locations—including bridges, culverts, retaining walls, and shoreline structures—to reduce service disruptions and equipment damage caused by extreme weather). For Long Island Rail Road (LIRR), it will spend $6 billion on rolling stock (purchasing new railcars to allow MTA to retire 1980s-era M3 cars and provide for “more reliable new dual-mode locomotives”); power system improvements (replacing or renewing 16 substations making the system more reliable); and accessibility (achieving 98% accessibility by making four more stations accessible, including Bellerose, Douglaston, and Cold Spring Harbor).
Finally, MTA said its capital plan includes $800 million to advance regional investments that help create additional capacity, connect with underserved communities, and respond to changing populations and land-use patterns. “The plan supports projects to reduce conflicts at the nation’s busiest railway junction, electrification and capacity initiatives on the LIRR and MNR, and the evaluation and development of promising improvement and expansion projects,” it reported.
According to MTA, all this will be achieved with a funding plan that includes “a balanced and responsible mix of local, state, federal and MTA sources as well as new Payroll Mobility Tax (PMT) revenues from the region’s largest businesses.” In addition to providing $8 billion in total operating aid for the MTA, the New York FY 2026 Budget will provide a $3 billion state capital appropriation to support the MTA capital plan, MTA said. “The modest change to the PMT will cause the largest businesses in the region with payrolls of $10 million or more to pay less than 1% more in PMT,” it noted. The FY 2026 Budget also requires the City of New York to provide $3 billion toward the MTA capital plan and requires MTA to find $3 billion in efficiencies, according to the transit agency.
“Notably, the FY 2026 Budget also reallocates up to $1.2 billion from the Penn Station redevelopment project to be put towards priority capital projects such as the Interborough Express, safety initiatives, and efforts to reduce fare evasion,” MTA reported.
“The Governor and legislature have been great supporters of MTA riders and understand the importance of mass transit to New York’s economy,” MTA Chair and CEO Janno Lieber said. “An extraordinary effort went into identifying what needs to be done to maintain the $1.5 trillion asset that is our region’s transportation network. The women and men of the MTA look forward to getting to work on important capital projects that deliver on the Governor’s vision and ensure that New Yorkers keep moving for decades to come.”
