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House Passes Amtrak Bill, Paterson Announces MTA Commission

The Amtrak bill that would solicit private sector proposals to build a high speed rail link between DC and NY passed the House on Tuesday. Gannett News reports that the 227-187 margin fell short of the majority required to override a Bush veto.

In addition to providing Amtrak operating subsidies over five years, the measure seeks to boost investment in high-speed rail.

It also calls for opening up the Washington-to-Boston route and 10 others across the country to private competitors — something Democrats such as Sen. Frank Lautenberg of New Jersey strongly oppose.

Though President Bush likes the bill’s privatization proposal, he rejects boosting funding for passenger rail if Amtrak isn’t held more accountable and doesn’t change the way it does business, the White House said in a statement explaining the veto threat.

Lautenberg, meanwhile, co-wrote an $11.4 billion Amtrak bill that passed the Senate 70-22 in October.

House and Senate negotiators have to come up with a compromise bill, which would then have to pass Congress and win Bush's signature to become law.

In other news, Governor Paterson announced his appointments to a commission on MTA financing. Richard Ravitch, former head of the MTA, will chair the commission. Appointees include MTA CEO Lee Sander, developer Douglas Durst, Con Ed chair Kevin Burke, and former Port Authority director Peter Goldmark. Excerpts from a press statement:

Governor David A. Paterson today appointed 12 members to the Commission on Metropolitan Transportation Authority (MTA) Financing, to be chaired by former MTA Chairman Richard Ravitch. The Commission is charged with recommending strategies to fund MTA capital projects and operating needs over the next ten years, a period when the Authority will be under unprecedented financial pressure as it expands its system and rebuilds its core infrastructure to provide the additional capacity needed to allow the region to grow. Governor Paterson announced in April that Richard Ravitch would head the Commission in wake of the failure of the congestion pricing proposal, which would have provided an additional revenue stream to the MTA….More here.

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AYR Recaps Brodsky’s Hearing on Moynihan, other West Side Projects

Atlantic Yards Report has a thorough recap of Assemblyman Richard Brodsky’s hearing on West Side development held last Friday. Brodsky, who chairs the Assembly Corporations, Authorities and Commissions Committee, used the opportunity to question Deputy Mayor for Economic Development Robert Lieber, ESDC’s acting president Avi Schick, MTA Chair Lee Sander and others about the public investment and current status of Hudson Yards, the 7 line extension, and, of course, Moynihan Station.

We’ve excerpted some Moynihan-related items below, but the entire recap is worth reading - especially an exchange about using eminent domain for MSG. The Observer has a brief article on Sander’s comments about bringing light rail to the West Side and WNYC focused on comments about expanding Amtrak service at Penn Station to obtain further federal funding for the Moynihan project (see our related posts on a federal proposal for NY/DC high speed rail).

Looking at Moynihan

When it came to the Moynihan Station project, which could involve a new rail station in the Farley Post Office, the relocation of Madison Square Garden, and new office towers and retail over the current Penn Station/MSG site, Brodsky had the same basic questions. “How do I know how the public investment should be made versus private--what’s the rule?” he asked.

You make what’s “necessary to maintain the infrastructure, to maintain the stature of the city” replied Avi Schick, acting president of the ESDC. “This is not a subsidy for economic development. It is maintaining and enhancing transportation.”

Brodsky asked the “value of 5.4 million in FAR.” (He was referring to Floor Area Ratio but meant, simply, development rights.)

It’s not a simple answer, Schick said, saying that the working number is $125/square foot--the figure Levin later disputed.

Brodsky again asked about the appropriate relationship between public and private investment.

“We take into account the nature of the project,” Schick replied gnomically.

Brodsky acknowledged he was facing a formidable rhetorical foe. “I’m going to get you, Mr. Schick, but it’s going to take a bit longer,” he said playfully.

(At the close of the hearing, he offered public thanks to Schick for service to the state, suggesting that this might have been Schick’s last public hearing. Schick is leaving in September, so that suggests that, at the least, Brodsky’s not planning to hold an Atlantic Yards hearing by September.)

Who’s paying?

Brodsky brought up the apparent effort by Madison Square Garden to get government to advance the cost of building an arena.

“To my understanding, it’s not for the Garden, it’s for the [Moynihan Station] project,” Schick said.

Has the Garden asked for such support, Brodsky asked.

No, replied Schick.

Brodsky amended his question: Has the joint venture--involving Related Companies and Vornado Realty Trust--asked for such funding.

Yes, replied Schick.

Lieber added the entire financing plan was under discussion.

Summing up

In closing the hearing, Brodsky said the general question of whether we’re subsidizing projects at an appropriate level still remains. Still, he said he appreciated the government officials’ willingness to answer questions at a public forum, calling it an important part of the governmental process.

“I hope we can move forward on these [West Side] projects,” he said. “I fear we’re in more trouble than we’re letting on.” (He noted that it was news to him that the hearing brought out the city’s commitment to spend up to $3.5 billion on the #7 line, given that he'd previously criticized the city for committing to only $2.1 billion.) He said he was recessing rather than closing the hearing, given that he hoped Port Authority representatives would testify as well.

Does the legislature have any power, he was asked after the hearing. While it may not have direct oversight of such project, he said, in the long run the legislature has the power to pass laws restricting certain actions.

Again he criticized governance mechanisms to manage projects that bypass democracy. "What we've structured is a set of governance mechanisms that eliminate democratic institutions," he said. "And the net result is that anonymous people.... this is a set of Soviet-style bureaucracies that are acting without any public accountability, even when they’re right. They would much rather discuss whether they're right or wrong.... The reason we're in this problem with these projects is that the governance is secretive and out of touch, and we don't have enough money."

Doesn't Brodsky favor a new authority, however, to oversee the Hudson Yards project?

"A foolish consistency is the hobgoblin of little minds," riposted Brodsky, never at a loss for words. "The answer is, right now, I'm wrestling with a series of emergencies and the fact of the matter is that the Hudson Yards deal does not represent a thought-out economic development strategy or priority for what the city and the region need. In defense of that, we're scrambling for ways of gaining some control. It's not necessarily intellectually consistent."

"Having said that," he continued, "what today's hearing was about was bringing out into public view the realities of decisions, like on Moynihan, like, for example, the Garden is now seeking public monies." (He said he'd seen documents that have not been made public.)

"The Dolans have every right to seek public support," he said. "The public ought to deal with it intelligently. That's what this is about. This is about returning these things to the control of public agencies."

Agencies, perhaps, but not--as per his comments--public authorities.

Read “At West Side Hearing, Brodsky Questions Subsidies, Muses About Eminent Domain for MSG,” from Atlantic Yards Report.

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Hudson Yards: With Tishman Out, MTA Turns to Other Developers

The MTA failed to come to terms with Tishman Speyer over the $1 billion Hudson Yards deal. According to a New York Times report from Charles Bagli (the moderator of the panel at MAS tonight), the MTA will resume discussions with three developers, including Vornado (in a joint venture with Durst) and Related, co-developers of Moynihan Station.

Tishman Speyer had sought to delay closing on the rights over the yard on the east side of 11th Avenue until it got a zoning change for the western yard, a process that could take 18 months. Under the terms of the deal struck in March, Tishman Speyer would have paid $18.8 million at the closing for the eastern yard later this year, and $24.7 million for the western yard sometime in 2009 or 2010.

In an attempt to salvage the project, the transportation authority said it will now turn to three other developers — Douglas Durst, Stephen Ross and Steven Roth — who had competed for the right to build a small city of office towers and apartment houses on a platform over the 26-acre rail yards.

“It’s an exciting and important project for New York City,” said Jordan Barowitz, a spokesman for Mr. Durst, who had offered $39 million less than Tishman Speyer. “We would be interested in resuming discussions on its development.”

Read “Talks Over West Side Yards Collapse Again,” by Charles Bagli for New York Times

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Paterson Reiterates Support for Moynihan Station, Calls for Panel on MTA Budget

Yesterday, in remarks before the Association for a Better New York Governor Paterson expressed strong support for Moynihan Station. The state has “to develop the far west side of this area, creating a third downtown center in the downstate region, with the development of the Hudson Yards and the establishment of Moynihan Station,” he said.

Just one day after the Mayor’s congestion pricing plan faltered in Albany, Paterson announced a “blue ribbon panel,” led by former MTA Chair Richard Ravitch, to “ameliorate the hole in our capital budget.” He said the panel will examine three main issues:

One is how to balance the subsidizing of the MTA Capital Plan, through the subscription of those who use the services and a broad balance of taxes for businesses and the rest of the public.

Secondly, what we want to look at are the elements of Mayor Bloomberg’s plan that all of us like, and that perhaps we can still weave them into the process

And finally, we have to get the MTA out of its habit, which is 25 years old, of refinancing and basically covering debt with excessive borrowing. By 1998, in this country the five largest borrowers were the State of California, the State of New York, the City of New York, the State of Massachusetts and the MTA. The MTA doesn’t even have a Governor and they are the fifth largest debtor in the entire country. That has to be changed.

In conclusion, Governor Paterson evoked New York’s history for encouragement about thinking and building big in tough economic times:

Finally, I just want to address the issue that I’m sure many people have, that how can we be talking about all of these creative projects at a time when we have fiscal deficit. It is actually I think the paradigm that most separates the foreparents of the State of New York and the City of New York from others, that even in the midst of crisis they fought, they suffered and they paid for it, but they went ahead and what they won was the greatest city in the world, developed from the dreams and aspiration of people who looked doubt in the face and went forward anyway. It is really amazing that six of the nine years that they were starting to establish the economic development, between 1820 and 1840, their budgets were in deficit. On January 20, 1930, right at the outset of the Depression, they put a shovel in the ground to build the Empire State Building. By March 1, 1931, it was built and it was open. Thirteen months. This was done by people we knew.

In 1939, still reeling from the Depression, on November 1st, John D. Rockefeller hammered the final nail into the construction at 10 Rockefeller Plaza, and introduced the public to Rockefeller Center. We can prevail during these particular times. No one knew this better than Gov. Franklin Delano Roosevelt, when he said in the early 1930s that out of crisis, out of tribulation, out of disaster human kind raises itself to share what is a greater vision, what is a greater ability and what is a more pure purpose. We can do this if we engage that new spirit of cooperation, and work toward a common goal. And if we work hard enough there will be a time when people will stand on this stage at another ABNY breakfast and talk about how the New York at the turn of the century endured its financial problems. And if we try hard enough, we may be able to look back in just a very few years and be very proud of the work we’ve done.

Read the complete speech here

Or watch a video!


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Ouroussoff Rips Hudson Yards

In an article in today's paper, New York Times architecture critic Nicolai Ouroussoff characterized Tishman’s winning bid for Hudson Yards as a "wishful fantasty," its design as “miserably depressing," and offered a scathing indictment of the state of large-scale development in New York:

If recent history teaches us anything, it is that the project is only likely to get worse. This is because of the nature of the urban planning process in New York, which tends to lock in the worst parts of a design while allowing a developer to chip away at what is most original and often most costly.

New York is experiencing the repercussions of such thinking at ground zero, where Daniel Libeskind’s master plan, unveiled by Gov. George E. Pataki to mixed reviews in 2003, is now a distant memory. Various design components have been watered down until they are barely recognizable.

In the Atlantic Yards project, Forest City Ratner acknowledged last week that it would delay building most of the elements of Frank Gehry’s design for that eight million-square-foot development because it is short of financing. If built, the project would be a pathetic distortion of the original design. And the developer already has city approval.

There will be a similar predicament if the city manages to steamroll the Tishman Speyer railyards proposal through the public review process. The broad outlines will be virtually set in stone, from the position of the park to the location of a yet-unchosen cultural institution. So will the site’s density, among the highest in the city. And the architecture within the plan will gradually diminish in quality. The West Side railyards is as good a place as any to start rethinking this disastrous approach to charting the city’s future. The transportation authority could begin by taking the planning process out of the hands of bean counters who have little interest in anything but profit. It could bring in more thoughtful voices from the urban planning and architectural fields. It could take into account the ups and downs of the area’s economy and how a neighborhood of this scale might evolve.

But that would mean championing the public good rather than hustling for money.

Read “Profit and Public Good Clash in Grand Plans,” by Nicolai Ouroussoff in The New York Times

Read “Ada Louise Huxtable Lambasts Hudson Yards and West Side Planning”

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Ask George: Response on West Side Yards

Last week, we received two detailed comments challenging George’s assertion that New York should lose the West Side Yards. Here is his response:

Typically, commuter rail lines have yards at their outer terminals in the suburbs, where trains are dispatched to the central business district, and yards close to the core, where cars are stored midday. Rapid transit lines, on the other hand, like our subways in NYC, have a single yard for each rail car. Trains might leave a yard in Brooklyn and end up in the Bronx, but no cars are stored in the center of town. Land is just too valuable. Newer rapid transit lines, with relatively long routes like those in Washington, DC or San Francisco (BART) offer much more frequent service all day long, and store rail cars that are not needed for this higher level of service in the same yards where they are kept overnight.

Much of the LIRR is like a long distance rapid transit system. Yet it is run like a 19th century railway, with far less service in the middle of the day than is need. This should change. The suburbs are not just homes for Manhattan-bound commuters, but are busy economic centers with travel needs all day long.

By keeping more trains in motion all day long, fewer mid-day storage spaces are needed in the center of the city. With the very high cost of building decks over yards, the need for these spaces can be seriously questioned. In my analysis, it looked like moving rail cars back to yards further east would increase operating cost by $8.2 million per year, or even less if more frequent service were operated all day long. This is a small price to pay to avoid spending a billion dollars or more for decks over the rail yards.

In 1987, when tracks that were needed to reach the yards were placed in service, they were helpful in making the northern portion of Penn Station into a thru-station increasing its capacity. This feature would be retained even if the yards are closed, since trains would continue to a two-track station that would be retained to provide access to West Side
development sites.

Finally, storing trains overnight in the center of the city, sending them empty to the suburbs to fetch passengers and then doing the same thing at the end of the day is costly. If rail yards cannot be built in the closer in suburbs, then the solution is to increase the utilization of the bi-level, dual-mode locomotive-hauled fleet which can be stored in existing underutilized yards much further to the east. These trains could be operated as thru-trains between points in Long Island and points in NJ. This need not wait for generations, but can be put into place over the next two to three years. This does require institutions to cooperate. Short of a full merger of all three commuter rail lines that serve the region, inter-operability agreements can be accomplished where the political will exists to press operators to move forward. With NY and NJ facing severe fiscal constraints, now is the time for agencies to work toward common solutions that save cost and improve service.

The time for the LIRR West Side Yard has come and gone. The stakes are too high to preserve the status quo!

What do you think? Please send us your comments and questions for George Haikalis.

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Ask George: Does New York Need the West Side Railyards?

Hudson Yards
George Haikalis believes the LIRR’s West Side Yards, opened in 1987, were not necessary in the first place. In his view, the MTA should eliminate the yards, but keep one platform with two tracks to run a shuttle on the existing tracks between the Hudson Yards development and Penn Station. This would eliminate the need for the $1 billion deck over the yards and significantly increase the value of the land by adding a link to the region's rail hub.

Haikalis is a civil engineer/transportation planner who co-chairs vision 42, a citizens initiative advancing a plan for an auto-free light rail boulevard on 42nd St. which is sponsored by the Institute for Rational Urban Mobility, Inc. (IRUM), a NYC-based not-for-profit corporation. IRUM also hosts the Regional Rail Working Group, an informal collaboration of rail advocates from the NY-NJ-CT metropolitan area.

He is here to answer your questions about transportation and the West Side, including Hudson Yards, Moynihan Station, and ARC, for the next two weeks. We'll call it “Ask George."

“For 77 years the LIRR operated without a West Side yard,” Haikalis said. “Their operations were such that the trains would either return to points in Long Island carrying passengers in the reverse peak direction, or would be operated without passengers to Long Beach, Babylon, or Jamaica where there was more yard space and they would stay until the evening peak. That added operating costs but nothing compared to the cost of building the yard, which was originally estimated at $100 million but turned out to be $230 million.”

Haikalis estimates that, in today's dollars, the added cost of returning LIRR cars to yards further east for midday storage would be about $8.2 million per year, small in comparison to the value MTA would gain from clearing the yard and selling it as raw real estate, with a good access link to Penn Station.

He points out that even with the Penn Station/Hudson Yards shuttle in place, the city's plan for the #7 line extension adds important additional connections to subway lines, particularly on Manhattan's East Side. Yet he is concerned that it may not be worth the cost. Soaring construction costs are slowing the pace of major MTA projects, including the #7, and the Fulton Street Transit Center has already been sent back to the drawing board.

Haikalis thinks the LIRR shuttle train would require little capital cost and could be placed into service quickly. “In this day and age if you were to build only a small two track platform and ran more trains in reverse peak hours to Long Island you would come out way ahead,” he said. Furthermore, linking Hudson Yards to the Penn Station transit hub furthers the establishment of a regional rail network in the city.

Please submit questions or comments on this and other transportation issues and Mr. Haikalis will be happy to address them.

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Moynihan Designs “Later This Year?!?”

The Real Deal’s excellent recap of last night’s panel on the Far West Side contains this update on Moynihan Station:

"We are planning a large public roll-out on this project soon," Empire State Development Corporation spokesperson Warner Johnston told The Real Deal, "but we are not planning to share designs until later this year."

What is a public roll-out of a $14 billion civic project and development without designs? As the New York Times recently editorialized, "If such negotiations must continue behind doors, that still does not mean the state and the developers can delay letting the public see detailed plans and proposals. Veteran commuters deserve some hope that the new Moynihan complex is not just another urban fantasy."

The story also quotes Anna Hayes Levin of Community Board 4 who “said that the public needs to see concepts for Moynihan Station before Hudson Yards can sensibly proceed.”

Meanwhile, the Rail Yards Blog lists the big West Side projects and predicts: “Chances are high that these projects will shift, scale back, or possibly fall through completely. This development burst is in its infancy, so it’s crucial that the public stay informed and demand accountability in both the planning and funding of these major projects.”

And it includes this quote from former MTA head Richard Ravitch:

Until Moynihan Station is resolved, there will be a serious impediment to development on the whole West Side.” Expansion of the station would promote natural growth of Midtown by adjacency, he explained, rather than starting with large commercial developments on 10th and 11th Avenues. He encouraged the MTA to hold off plans for the Rail Yards until Moynihan Station was settled.

Read ”Former MTA head: Moynihan Station confusion threatens Hudson Yards, by Alec Appelbaum in the The Real Deal

Read “MCNY Panel Calls for West Side Development Oversight, Funding Transparency” at Rail Yards Blog

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Hudson Yards and “The Fate of the Far West Side”

Yesterday, Crain’s reported that the MTA wants to lease the Hudson Yards site rather than sell it. On Monday the MTA sent out letters to the five teams outlining its preferred deal structure. Theresa Agovino reported:

“A source at one developer said the MTA was caving in to public pressure not to sell the property, which includes active MTA rail operations. But the MTA spokesman says that under a 99-year lease agreement the developer would still control the site…Still, the source at the developer said that the MTA is asking for a piece of the profits that will come from leasing the office and residential buildings that will be built on the site. He couldn’t say exactly how much it was requesting.”

Maintaining public ownership of the Hudson Yards site is in the public’s interest, but what is really needed is a coordinated plan – one that defines Moynihan Station as a catalyst - with more transparency about the public costs.

At a panel discussion last night on the West Side at the Museum of the City of New York, former MTA chairman Richard Ravitch lambasted the lack of coordinated planning in the Hudson Yards area. According to Norman Oder at the Atlantic Yards Report, Ravitch “criticized the MTA for its ‘shortsighted’ desire for revenue” and stressed that public land was an important public resource.

We filmed the panel - stay tuned for some video clips.

Read “MTA prefers leasing Hudson Yards,” by Theresa Agovino for Crain’s

Read Norman Oder’s recap at Atlantic Yards Report.


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