420 Lexington Avenue
New York, NY 10170
www.mta.info

Catherine A. Rinaldi
President

August 22, 2018

VIA E-MAIL AND FIRST CLASS MAIL
Kevin S. Corbett
Executive Director
New Jersey Transit
One Penn Plaza East
Newark, New Jersey 07105
Re:

Agreement between New Jersey Transit and Metro-North for Operation of
Passenger Service on the Port Jervis and Pascack Valley Lines

Dear Kevin:
As you know, Metro-North and New Jersey Transit (“NJT”) have an agreement dated July 27,
2006, by which NJT operates commuter rail service to Metro-North customers traveling on the
New York portions of the Port Jervis and Pascack Valley lines (“Agreement”). Under this
Agreement, NJT is obligated to provide a certain number of trains per route for this service, and
operate according to a certain agreed-upon schedule. Consistent, reliable train operation is a
paramount material component of the Agreement, as well as central to Metro-North and its
customers’ expectations of the service provided by NJT. Unfortunately, NJT’s frequent and
ongoing cancellation of trains servicing Metro-North’s customers demonstrates an inability of
NJT to meet its contractual service standards. We have previously shared with you the
escalating complaints received from our customers, which have been coupled with demands for
relief from both local and federal elected officials.
The 2017 train cancellations reflect a 77% increase over the 2016 cancellations, and the service
has only worsened in 2018. In 2018, we reported to our Board an annual goal for west-ofHudson service of 60 cancelled trains, or an average of five cancelled trains per month. Just in
April, May and June 2018, NJT cancelled 26, 26 and 10 trains respectively, serving Metro-North’s
customers. From July 1 through August 19, another 65 of our trains were cancelled. Thus, in the
most recent period covering less than five full months, 127 trains were cancelled – more than
doubling the target for the entire year.
Metro-North understands that a key component underlying the frequency of NJT’s cancelled
and late trains is the lack of sufficient qualified locomotive engineers. Therefore, Metro-North
proposes a provision incorporating the following concepts, with the details to be worked out
between us:

MTA Metro-North Railroad is an agency of the Metropolitan Transportation Authority, State of New York
Joseph J. Lhota, Chairman

 •

In months where eight or more scheduled trains are cancelled (significantly worse
than the five per month goal), Metro-North will take a credit against NJT billings
for each such additional cancelled train in excess of seven. The proposed amount
of the applicable credit to be taken, per train per month, would be based on the
approximate cost charged to Metro-North by NJT for such trains, determined by
a review of applicable NJT billings, as follows:

PVL
PJL
•

Common

Express

$850
$2,550

$2,800
$4,250

Metro-North will make a performance incentive payment for each month that
NJT cancels four or fewer scheduled trains (that is, bettering the average goal of
five per month). The amount of the incentive payment, where earned, is to be
negotiated, and will be applied by NJT in a way that will positively impact
engineer availability for the Metro-North service, either as incentive payments to
be made to engineers operating the Metro-North service or to be applied by NJT
toward the recruitment and training of additional engineers.

Unless we receive a positive response to our proposal, or an acceptable alternative to address
NJT’s deficient service to our Port Jervis and Pascack Valley customers, it is Metro-North’s
intention to deem NJT’s failure to meet its service obligations under the Agreement a Dispute
that entitles Metro-North to invoke the Dispute Resolution provision of the Agreement and to
establish a Dispute Resolution Committee under Section 10.01. In addition, in the event that
NJT does not identify solutions to the unreliable service that Metro-North’s West of Hudson
customers are currently receiving, Metro-North reserves the right to assert a credit against its
payments to NJT based upon an excessive number of cancelled trains, in the amounts set forth
above. It would be our intention to hold such monies in escrow, to be applied in a manner that
ensures better service for our West of Hudson customers.
I trust you understand the seriousness of this issue to our customers and us, and that we are not
taking these steps lightly. I look forward to hearing from you shortly.
Sincerely,

Catherine Rinaldi