Metrocard price reductions will come into effect this week for the vast majority of metro card holders in the US, as part of the nation’s first major price reductions in more than a decade.
The change in Metrocard pricing is the first since the 2011 expiration of the national Low-Income Home Energy Assistance Program, a program that provides financial assistance to low-income households that were eligible for subsidies when the previous program expired.
The price reductions come as a result of a deal struck between the Trump administration and states and cities to help alleviate pressure on the $2.5 trillion federal budget.
The changes will impact the most popular Metrocard program, the Metropolitan Transportation Authority MetroCard, which serves about 4 million households.
The deal between the administration and the states and metro area cities will help keep MetroCard prices low for consumers.
The price cuts will come in 2018 for those who currently receive subsidies.
The program has seen a spike in recent months as a series of factors including rising energy prices, a new healthcare law, and President Donald Trump’s tax cuts have forced many consumers to use less energy and save on their bills.
The average MetroCard purchase price has gone up nearly 15% in the past three years, to $539.89, according to a December 2017 analysis by the Kaiser Family Foundation.
The agreement between the White House and the metro area states was struck after years of negotiations between the two administrations.
It comes as the administration has been under scrutiny for its handling of Hurricane Harvey relief, and it has been accused of allowing states to take advantage of the lower gas prices in the market to increase spending.
The federal government has also been criticized for its treatment of state and local governments that do not spend enough to help with the recovery efforts after Hurricane Maria devastated Puerto Rico.
The cuts will apply to all metro cardholders, regardless of their household size.
The reductions apply for 2018.
The White House said the cuts are part of efforts to stabilize the budget.
“We’re working to find savings in the budget that will allow us to meet the needs of the American people, to keep our promises to the American taxpayers and to create the long-term jobs and prosperity that the American economy needs,” White House press secretary Sarah Huckabee Sanders said.
The MetroCard program was created in the 1990s as a way to help low- and moderate-income families pay for electricity, heating, and other essential services.
The government provided the vouchers to eligible households who needed it, but those households had to apply for them and were required to contribute toward their purchase.
The government has provided about $1.5 billion worth of vouchers in 2017, and about $9 billion in 2018, according a study by the American Action Forum, a right-leaning think tank.
The White House budget office has estimated that about half of the remaining $4.5 to $7 billion the federal government is expected to spend on the program will go to the states.
The reduction in subsidy payments comes amid an ongoing effort by states and the Trump White House to reduce the federal budget deficit.
The new program also includes new programs aimed at helping consumers reduce their energy bills, including an initiative to lower the cost of energy-efficient air conditioners.
The administration said it is also extending a temporary subsidy program to reduce energy bills for consumers who have already been impacted by Hurricane Harvey.