Hochul says tariffs driving up MTA fleet upgrade costs

New York Gov. Kathy Hochul and MTA officials inaugurate the first completed section of the Long Island Rail Road’s Third Track on Aug. 15, 2022. (Metropolitan Transportation Authority of the State of New York from United States of America, CC BY 2.0 <https://creativecommons.org/licenses/by/2.0>, via Wikimedia Commons)

(The Center Square) — Democratic New York Gov. Kathy Hochul is renewing calls on the Trump administration to rollback tariffs after the release of a report showed the MTA will spend another $1 billion to upgrade its fleet of subway cars and buses because of the increased costs.

The report by the Metropolitan Transportation Authority board, unveiled at its monthly meeting, detailed the fiscal impact of the Trump administration’s tariff policy on the transit agency's plans to upgrade its rolling stock by purchasing new subway cars, commuter rail cars and buses.

The MTA is in the midst of a generational upgrade to its fleet, with $23 billion committed to purchase thousands of new vehicles, according to the Hochul administration, which says the spending will support thousands of New York jobs at companies that manufacture the vehicles and the components that build them.

Hochul, a Democrat who is seeking reelection in November, said the tariffs have put New York’s "largest improvement to our rail and bus fleet in history" at risk and called on the Trump administration to roll them back.

"Donald Trump’s reckless trade war does more than just raise prices for New York families, it severely threatens government’s ability to deliver on big, ambitious projects," Hochul said in remarks. "Our entire region depends on the MTA to get around, and this planned investment promises to support thousands of good New York jobs; these reckless tariffs must end now."

The governor said she has written to Commerce Secretary Howard Lutnick and U.S. Trade Representative Ambassador Jamieson Greer to request exemptions to transit rolling stock purchases from the current tariff regime.

MTA officials say the most recent generation of subway cars are assembled locally in Yonkers and in Nebraska, with more than 75% of the components made in the United States — well above the federal government's “Buy America” threshold for transit agencies. But agency officials said most modern rail cars require "some imported parts for which American manufacturers have no domestic alternative."

But the Trump administration's tariffs on specialized components required to build rolling stock dramatically dilute the value of the agency's 2025-29 capital plan, the MTA said.

The $1 billion in potential increased costs would cover the cost of purchasing new Metro-North coaches, rail cars to reduce crowding on the Long Island Rail Road; nearly 1,000 new buses or more than 250 subway cars, it said.

"As the MTA keeps breaking ridership records, our investments in the next generation of rolling stock become more important than ever," MTA Chair and CEO Janno Lieber said in a statement. "New subways, buses and railcars are needed to give our riders the service they deserve. It’s time for our partners in Washington to let us support American workers and responsibly spend taxpayer dollars."

The renewed push by New York City officials to roll back the tariffs came on the same day that a panel of federal judges in New York City heard arguments challenging Trump’s “Section 301” tariffs, which were imposed after the U.S. Supreme Court struck down his previous global tariffs.

The lawsuits being considered by the U.S. Court of International Trade in Manhattan claim the Trump administration is effectively trying to reimpose the worldwide tariffs that were previously struck down. But the Trump administration claims in court filings that the new tariffs are authorized under a 1974 federal trade act.