Albany lawmakers and Gov. David Paterson have finalized a bailout for New York’s cash-strapped transit system, assuring straphangers there will be “no surprises” in the new plan.

Paterson, Senate Majority Leader Malcolm Smith and Speaker Sheldon Silver held a joint news conference this evening where they announced the bailout plan.  It calls for a 10-percent increase in fares and tolls beginning in July.  This, instead of the 23-percent “doomsday” hike previously approved to start this month.

The base subway and bus fare will rise to $2.25, from $2. Major service cuts will be avoided, Gov. Paterson said.

The plan also will call for a reform of the MTA, including forensic audits and improved oversight, the lawmakers said.

The bill “completely funds the MTA’s operating budget” including the $600 million deficit recently discovered, Paterson said. The deal calls for fares and tolls to rise again, by 7.5 percent, in 2011 and by the same amount in 2013.

“Tomorrow the Assembly will hope to take up this legislation,” Silver said.

The deal would deliver the bulk of the $1.75 billion needed to close the Metropolitan Transportation Authority’s budget gap for this year by increasing the payroll tax.

In addition, it will give school districts throughout New York City a rebate to cancel out the effect of higher payroll taxes. That was a key demand of holdout senators — Brian Foley and Craig Johnson, both of Long Island — who delayed a vote on the rescue package into this week.

A taxi surcharge was reduced from $1 per ride to 50 cents, all of which will benefit the MTA. That would fund what Smith called a “modest” capital improvement at the MTA.

The rescue plan will provide billions of dollars to the MTA over the next few years to plug gaping budget deficits and to help finance its capital program.

A proposal for another 50 cents per trip to leverage about $1 billion in aid for bridge and highway work upstate and on Long Island was dropped, but Smith said it will be reconsidered in October when a full MTA capital plan is devised.

Mayor Michael Bloomberg had urged lawmakers to reject any plan that didn’t pay for capital projects.

The plan also avoids the controversial tolls on the East and Harlem River bridges.  Avoiding the tolls are a “victory for the public,” Smith said.

(Source: NBC New York)