MTA budgeting is a rigorous and in-depth annual process that culminates in the proposed passage of the Budget in December. Each year, the MTA prepares three financial plans: one in February, one in July, and one in November. Adoption Materials are prepared in December.
Every plan requires Agencies to develop budgets for the current year and a detailed four-year projection. Agencies use the category construct of MTA’s financial statements on both an accrual and cash basis. Accruals consist of non-reimbursable (operating) and reimbursable (costs recovered by the capital program or other sources).
Both the July and November Financial Plans are divided into two distinct volumes:
- Volume I: summarizes the complete five-year financial plan, including the baseline, as well as policy items and other “below-the-line” items;
- Volume II: includes detailed Agency information supporting baseline revenue, expense, cash and headcount projections. It also includes detailed information supporting actions taken to increase savings, as well as individual Agency deficit reduction programs.
The July Financial Plan provides:
- a revised forecast of the current year’s finances,
- a preliminary presentation of the following year’s proposed budget, and
- a three-year re-forecast of out-year finances.
The July Plan may include a series of gap-closing proposals necessary to maintain a balanced budget and actions requiring public hearings. The Mid-Year Forecast becomes the basis with which monthly results are compared to for the rest of the year.
The November Plan is an update of the July Financial Plan. It's prepared after stakeholders have weighed-in on the impact of new developments and risks have been quantified. The November Plan includes:
- a revised current year financial report,
- finalization of the proposed budget for the upcoming year, and
- projections for the three out-years.
December Adopted Budget
In December, the November Plan is updated to capture further developments, risks, and actions that are necessary to ensure budget balance. That is presented to the MTA Board for review and approval.
Finally, certain below-the-line policy issues included in the December Adopted Budget are moved into the baseline. Technical adjustments are made. This results in the February Plan. The Adopted Budget is allocated over the 12-month period and becomes the basis with which monthly results are compared.