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November 7, 1995

NEW YORK URBAN LEAGUE, INC., STRAPHANGERS CAMPAIGN, ANDREA MAPP, DEBORAH CARRINGTON, and JUAN B. GONZALEZ, Plaintiffs, against METROPOLITAN TRANSPORTATION AUTHORITY, E. VIRGIL CONWAY, as Chairman and President of the MTA, THE STATE OF NEW YORK, GEORGE E. PATAKI, as Governor of the State of New York, JOSEPH L. BRUNO, as Temporary President of the New York State Senate and SHELDON SILVER, as Speaker of the New York State Assembly, Defendants.

The opinion of the court was delivered by: PATTERSON


 Plaintiffs move pursuant to Rule 65 of the Federal Rules of Civil Procedure for a preliminary injunction to restrain Defendant, New York Metropolitan Transit Authority ("MTA") from implementing a fare increase announced October 19, 1995 and scheduled to take effect November 12, 1995.

 Plaintiffs bring this action pursuant to Title VI of the Civil Rights Law of 1964 to obtain injunctive relief against the State of New York and the MTA. The announced change would increase the fare on New York City's subways and buses from $ 1.25 to $ 1.50, or 20%, *fn1" and the fare on the Long Island Railroad ("LIRR") and the Metro-North Railroad ("Metro North") (collectively the "commuter lines") by approximately 9%. Plaintiffs assert that pursuant to the announced fare increase "the allocation of the total available subsidies to [the New York City Transit Authority ("NYCTA")] and the Commuter Lines has been done in a manner which has the effect of discriminating against the predominantly minority riders of NYCTA." (Complaint filed October 20, 1995 ("Complaint") P 62.)

 Plaintiffs also seek relief against Governor George Pataki, E. Virgil Conway, chairman of the MTA, Senator Joseph Bruno and Assemblyman Sheldon Silver pursuant to 42 U.S.C. § 1983 and the Fourteenth Amendment. Plaintiffs contend that these Defendants "have acted under color of state law to deprive plaintiffs of their rights to equal protection of the laws by disbursing government benefits in the form of transportation subsidies between predominantly white and predominantly minority transit riders in a discriminatory manner." (Complaint P 66.)

 Two Defendants, Governor Pataki and Senator Bruno, have filed a cross motion pursuant to Fed. R. Civ. P. 12(b)(6). These Defendants assert that the Complaint should be dismissed because it fails to state a claim against either of them.

 On November 2, 1995, an evidentiary hearing was held on Plaintiffs' motion for a preliminary injunction. Because the fare increase is to become effective on November 12, 1995, this opinion addresses only Plaintiffs' motion for a preliminary injunction so that either party will have time to seek relief from the Court of Appeals before that date.



 The New York Urban League, Inc. ("NYUL") is a not-for-profit, community service organization with offices and programs located in the five boroughs of New York City. (Complaint P 4.) NYUL was founded in 1919 and "combats the problems faced by African-Americans who face discrimination in jobs, housing, education and social services." (Id.)

 The Straphangers Campaign ("Straphangers") is a part of the New York Public Interest Research Group Fund. It was founded in 1979. (Complaint P 6.) Straphangers is dedicated to educating citizens "so that they may participate in public debate on issues relating to mass transit." (Id.)

 The three individual plaintiffs are: Andrea Mapp ("Mapp"), an African-American woman who lives in New York County; Deborah Carrington ("Carrington"), an African-American woman who lives in Kings County; and Juan B. Gonzalez ("Gonzalez"), a Latino man who lives in the Washington Heights section of Manhattan. (Complaint PP 8-10.) All three individuals state that they are of modest income and that they use subways and buses as their sole means of transportation.

 The MTA is a public benefit corporation created in 1965 by New York Public Authorities Law ("P.A.L.") § 1263. The MTA is a component unit of the State of New York whose purpose is to continue, develop and improve "commuter transportation and other services related thereto within the metropolitan commuter transportation district. It shall be the further purpose of the authority, consistent with its status as the ex officio board...of the New York City Transit develop and implement a unified mass transportation policy for [the New York Metropolitan area]." P.A.L. § 1264; (Affidavit of Frank Mauro submitted October 20, 1995 ("Mauro Aff."), Ex. 1 at 62.) The MTA's affiliated agencies include: LIRR, Metro-North, the Triborough Bridge and Tunnel Authority ("TBTA"), and NYCTA.

 The LIRR is a suburban commuter railroad that provides commuter rail services to residents of Nassau and Suffolk counties. (Complaint P 20.) Residents of Westchester, Rockland, Orange, Dutchess and Putnam counties, are served by Metro-North. (Id. at P 21.) Both of these entities are wholly owned subsidiaries of the MTA. (Id. at PP 20, 21; Mauro Aff., Ex. 1 at 62.)

 The TBTA is a public benefit corporation which was created pursuant to P.A.L. § 550, et seq. The TBTA operates seven toll bridges, two tunnels, the Battery Parking Garage, and the New York coliseum. (Mauro Aff., Ex. A at 62.) The TBTA is a component unit of the MTA but it is organized as a separate legal entity and operates independently of the MTA. (Id.) The operations of the TBTA result in a substantial surplus which is allocated to the MTA and the NYCTA according to a statutorily defined formula set forth in P.A.L. § 1219-a(2)(b).

 The NYCTA is a public benefit corporation, organized pursuant to P.A.L. § 1200, et seq. which operates as a legal entity separate from the MTA. (Id.) The NYCTA, a component unit of the MTA, provides subway and bus service within four of the boroughs of New York City. (Id.)

 The MTA board of directors consists of seventeen voting members, including the chairman and six non-voting members, four of whom are alternates. *fn2" P.A.L. § 1263(1)(a); (Complaint P 9). The boards of directors of the NYCTA, the TBTA, and the MTA subsidiaries are composed of the same individuals as the board of the MTA. P.A.L. §§ 552(1), 1201(1); (Complaint P 10); Tr. 147-148) *fn3"


 The operating revenue of each of the component units of the MTA, other than the TBTA, does not equal the costs of operations. As a result, each year the MTA, the NYCTA, the LIRR, and Metro North operate at a deficit, as do mass transit systems across the country. Accordingly, despite the statutorily allocated TBTA surplus described above, the MTA depends on subsidies from federal, state and city governments to pay for operating and capital costs not covered by revenue generated from fares. (Affidavit of Stephen V. Reitano, Chief Financial Officer of the MTA, dated October 30, 1995 ("Reitano Aff.") P 10.)

 a. Federal Subsidy

 The MTA receives funding for mass transit capital projects and operations from the Federal Department of Transportation. These subsidies are provided pursuant to the Urbanized Area Formula Program under 49 U.S.C. § 5307, the Capital Program as defined by 49 U.S.C. § 5309, and other federal grant programs. (Id. at PP 13, 14.)

 b. State Subsidies

 Each year New York State's budget includes the following subsidies to the MTA and its subsidiaries and affiliates. (Mauro Aff. P 14.) The payment of state subsidies is subject to appropriation and to the availability of ...

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