April 27, 2005
M.T.A. Delays 2 Excavation Contracts After State's Budget Reduction
By SEWELL CHAN The New York Times
In a sign of uncertainty over the financing of its grand expansion projects, the Metropolitan Transportation Authority said yesterday that it had put off awarding two contracts for tunnel excavation in Queens and Manhattan, totaling $460 million, that are vital to a project to connect the Long Island Rail Road to Grand Central Terminal.
Members of the authority's board expressed doubts about the feasibility of the $3.8 billion project, known as East Side Access, and suggested that another plan, to build a subway under Second Avenue in Manhattan, was even less likely to be realized.
The gloomy predictions came as board members met for the first time since Gov. George E. Pataki agreed to a state budget that provides $21.1 billion for transit infrastructure projects through 2009 - $6.7 billion less than the authority requested in September. The board's finance committee approved a scaled-back capital program for the next five years that would defer the rehabilitation of 12 subway stations and shelve construction of a 16-track storage yard for the Long Island Rail Road, among other cost-cutting efforts.
After the full board meets tomorrow, the authority will submit the revised plan to the Capital Program Review Board, a panel that includes representatives of Mr. Pataki and the leaders of both chambers of the Legislature.
In 1982, the authority began a succession of capital programs that are credited with reviving the subway, bus and commuter rail networks after decades of neglect and underinvestment. But it has become increasingly clear that in the latest plan, for 2005 to 2009, expectations outpaced fiscal and political realities.
Even the reduced plan approved yesterday assumes passage of a $2.9 billion transportation bond act - half of which would benefit the authority - that will be put before the state's voters in November. It also assumes that the authority can raise $1.4 billion from asset sales and other sources.
The authority's already high debt will grow even more. Through 2009, it will borrow $5.1 billion, to be paid off by $350 million a year in higher taxes and fees that the Legislature has approved.
As the reality of the constraints on the authority's spending sank in yesterday, several board members expressed deep skepticism about its plans for expansion.
"I don't see how in the world you can do both of those projects," said Barry L. Feinstein, a board member since 1989 and chairman of the committee that oversees New York City Transit.
Mark D. Lebow, a corporate lawyer who represents Mayor Michael R. Bloomberg on the board, said that the state budget was "insufficient for either" project and predicted that the Second Avenue subway would not be built.
The two tunneling contracts were put out for bids last August. Several firms responded and the authority has identified the two firms that would get the work.
East Side Access has progressed farther than the Second Avenue subway, and would seem the logical priority if a choice between the two had to be made. It is expected to cost $6.3 billion and to be completed by 2012. Design started in March 1999 and construction officially began in September 2001. As of last month, $736.7 million had been spent.
By comparison, the Second Avenue subway is projected to cost $16.8 billion. The first segment, from 96th to 63rd Streets, is estimated to cost $3.8 billion and to be completed by 2012. Design began in December 2001, and construction was supposed to start last December, but has been postponed to this September. As of last month, $211.2 million had been spent.
Both projects have powerful proponents in the Legislature. The proposed subway line is backed by the Assembly speaker, Sheldon Silver, a Manhattan Democrat, while the Long Island Rail Road project has a champion in State Senator Dean G. Skelos, a Republican from Nassau County and the Senate's deputy majority leader.
The authority's executive director, Katherine N. Lapp, tried yesterday to put a positive spin on the reductions. "The good news is, the integrity, safety and reliability of our system will be maintained," she said.
Ms. Lapp said it would take "a couple of weeks, maybe a month or so" to reassess the two schedules.
Another uncertainty is the extent of federal support for the two projects. The Federal Transit Administration has rated both as high priorities, and the authority's new budget assumes a $1 billion contribution from a federal program, New Starts, that finances transit construction. Federal officials may balk, however, if the state does not demonstrate its readiness to provide enough matching dollars to move the projects forward.
In another development, the authority disclosed yesterday that New York City Transit had raised $2.9 million less in fares than it had projected in March, the first full month since fares were increased on Feb. 27. Officials attributed the shortfall in part to inclement weather.
Copyright 2005 The New York Times Company
M.T.A. Delays 2 Excavation Contracts After State's Budget Reduction
By SEWELL CHAN The New York Times
In a sign of uncertainty over the financing of its grand expansion projects, the Metropolitan Transportation Authority said yesterday that it had put off awarding two contracts for tunnel excavation in Queens and Manhattan, totaling $460 million, that are vital to a project to connect the Long Island Rail Road to Grand Central Terminal.
Members of the authority's board expressed doubts about the feasibility of the $3.8 billion project, known as East Side Access, and suggested that another plan, to build a subway under Second Avenue in Manhattan, was even less likely to be realized.
The gloomy predictions came as board members met for the first time since Gov. George E. Pataki agreed to a state budget that provides $21.1 billion for transit infrastructure projects through 2009 - $6.7 billion less than the authority requested in September. The board's finance committee approved a scaled-back capital program for the next five years that would defer the rehabilitation of 12 subway stations and shelve construction of a 16-track storage yard for the Long Island Rail Road, among other cost-cutting efforts.
After the full board meets tomorrow, the authority will submit the revised plan to the Capital Program Review Board, a panel that includes representatives of Mr. Pataki and the leaders of both chambers of the Legislature.
In 1982, the authority began a succession of capital programs that are credited with reviving the subway, bus and commuter rail networks after decades of neglect and underinvestment. But it has become increasingly clear that in the latest plan, for 2005 to 2009, expectations outpaced fiscal and political realities.
Even the reduced plan approved yesterday assumes passage of a $2.9 billion transportation bond act - half of which would benefit the authority - that will be put before the state's voters in November. It also assumes that the authority can raise $1.4 billion from asset sales and other sources.
The authority's already high debt will grow even more. Through 2009, it will borrow $5.1 billion, to be paid off by $350 million a year in higher taxes and fees that the Legislature has approved.
As the reality of the constraints on the authority's spending sank in yesterday, several board members expressed deep skepticism about its plans for expansion.
"I don't see how in the world you can do both of those projects," said Barry L. Feinstein, a board member since 1989 and chairman of the committee that oversees New York City Transit.
Mark D. Lebow, a corporate lawyer who represents Mayor Michael R. Bloomberg on the board, said that the state budget was "insufficient for either" project and predicted that the Second Avenue subway would not be built.
The two tunneling contracts were put out for bids last August. Several firms responded and the authority has identified the two firms that would get the work.
East Side Access has progressed farther than the Second Avenue subway, and would seem the logical priority if a choice between the two had to be made. It is expected to cost $6.3 billion and to be completed by 2012. Design started in March 1999 and construction officially began in September 2001. As of last month, $736.7 million had been spent.
By comparison, the Second Avenue subway is projected to cost $16.8 billion. The first segment, from 96th to 63rd Streets, is estimated to cost $3.8 billion and to be completed by 2012. Design began in December 2001, and construction was supposed to start last December, but has been postponed to this September. As of last month, $211.2 million had been spent.
Both projects have powerful proponents in the Legislature. The proposed subway line is backed by the Assembly speaker, Sheldon Silver, a Manhattan Democrat, while the Long Island Rail Road project has a champion in State Senator Dean G. Skelos, a Republican from Nassau County and the Senate's deputy majority leader.
The authority's executive director, Katherine N. Lapp, tried yesterday to put a positive spin on the reductions. "The good news is, the integrity, safety and reliability of our system will be maintained," she said.
Ms. Lapp said it would take "a couple of weeks, maybe a month or so" to reassess the two schedules.
Another uncertainty is the extent of federal support for the two projects. The Federal Transit Administration has rated both as high priorities, and the authority's new budget assumes a $1 billion contribution from a federal program, New Starts, that finances transit construction. Federal officials may balk, however, if the state does not demonstrate its readiness to provide enough matching dollars to move the projects forward.
In another development, the authority disclosed yesterday that New York City Transit had raised $2.9 million less in fares than it had projected in March, the first full month since fares were increased on Feb. 27. Officials attributed the shortfall in part to inclement weather.
Copyright 2005 The New York Times Company