NOTE: This is a long article (2586 words). Some of the newspaper stories are repetitive, but we wanted to give you a chance to link to anything written on the subject. You can skip the parts you already know. If you have any questions or comments, we would be more than pleased to respond to you. -- SQ

Even MTA Admits That It Is Unable
To Complete Fulton Subway Palace
As Construction Costs Keep Rising

By Henry J. Stern
January 30, 2008

The roof fell in on the MTA Monday, specifically the glass roof on the dome the transportation agency is trying to build as an elaborate approachway to the Fulton Street Transit Center.

MTA chief Eliot Sander wisely pulled the plug, at least for the time being, on a project whose cost had skyrocketed by $400 Million dollars. Although an interesting amenity, the dome would not get any passengers home or to work any sooner. It would not relieve rush hour overcrowding on the trains. It would not shorten the distance riders have to walk to get to the subway line of their choice.

New York Civic has now been around long enough (six years) that we can cite our old articles, which occasionally predict misfortune. We take no pleasure in quoting Rule 10-I "I told you so.," but if any situation deserves that comment, this is it.  We wrote repeatedly years ago about the escalating costs and minimum value of three major construction projects (loosely called 'improvements' in lower Manhattan. Two of these sinkholes are brain children of the MTA and its engineering staff, but the most extravagant and irresponsible castle in the sky is being undertaken by the Port Authority of New York and New Jersey, which acted at the direction of Governor Pataki.

Return with us now to the thrilling days of yesteryear. We call your attention to the following articles, which are highly relevant to today's predicament. On November 29, 2006, our headline read: BUILDING CASTLES UNDERGROUND: MTA APPROACHES $BILLION COST ON FULTON STREET CONSTRUCTION.

We continue our trek two years further into the past. On June 22, 2004, our subscribers received UNDERGROUND PALACES: $450 Million for South Ferry Station Could Go to Other Transit Needs. 

On March 30, 2005, MTA HIRES MANAGEMENT CONSULTANTS; HOPES THEY CAN HELP SAVE $MILLIONS, BUT MOST WASTE IS IN CAPITAL PROJECTS. If you have time, link to those appetizing and infuriating stories of mismanagement and bad judgment on the part of high public officials. If you don't have the time to link to the full monty, we have extracted a few paragraphs for your delectation.

On November 29, 2006, we looked at the three projects which were then under way. 

"The massive expenditure of public funds in the construction of the Fulton Street Subway Palace is slowly coming to light.

"When the decision was made years ago to rebuild the Fulton Street stations of various lines into a Grand Central Station of the South, the stated rationale was that two BILLION dollars was available from the Federal government, following 9/11, that could only be spent on transit improvements south of Canal Street in Lower Manhattan.

"That was a reprise of Robert Moses' old strategy to secure consent for his projects -- telling the Board of Estimate, the press and the public that money was only available for what he wanted to build, and otherwise the money would be lost to the city and the state.

"Two projects, suggested by MTA engineers during their idle months between designing subways, were presented as pre-planned and almost ready to build. One was the South Ferry station reconstruction, and the other the Fulton Street transit center. South Ferry was supposed to cost $400 million and Fulton $750 million, give or take a few million Federal capital dollars.

"The projects were opposed at the time by the usual suspects, some civic groups and Community Board No. 1. The buildings were supported by construction unions, engineering companies, contractors and their hirelings and sundry doofuses who will support anything under the mantra of transit."

Two and a half years earlier, on June 22, 2004, New York Civic had discussed the PATH station at the World Trade Center site.

"But South Ferry and Fulton Mall, costly as they are, pale beside the most egregious example of extravagance cloaked by the word 'transportation.' That is the $2 BILLION of federal money that the Port Authority intends to spend for its new Santiago Calatrava-designed station at the former World Trade Center. It will be a magnificent monument, lacking only passengers to bring it to life.

"Since I maintain the simple notion that people take the subway for rapid transit, rather than for glorious stations, I wonder whether the resources spent on architects, engineers, contractors, and their employees would be better spent elsewhere on the underfunded transit system. Yes, Grand Central Station is palatial and now, historic, but it would not make sense to put a station where there are hardly any people to use it."

Forward again, March 30, 2005, two years and ten months ago..

"The second boondoggle is the Fulton Street station reconstruction. This will take at least a billion dollars, and it is minor rerouting of existing lines, with an arcade to the former World Trade Center. Yes, some work should be done here, but the whole nine yards is unnecessary."

These are just excerpts from articles we wrote years ago on this subject. We give the history and background of each project. If you have the time, we urge you to link to them. They explain in detail why these projects are so overblown.

CURRENT PRESS REPORTS

Here are today's accounts of the MTA's abandonment of the dome plan, for which dozens of businesses had been closed down, and the old Citizens Union headquarters demolished, clearing a half-block of costly real estate (the east side of Broadway, south from Fulton Street to within 25 feet of John Street).

In the last two days, the curtain concealing the debacle has been lifted as MTA Chief Elliot Sander, who was stuck with this mess by his predecessor, Peter Kalikow, says that because of mushrooming costs funds are currently unavailable to complete the projects. Here are eight stories which appeared over the last two days in five New York dailies. You can link to any of them, read their ledes below, or skip them all to continue with to our text. We particularly recommend the Daily News editorial for your perusal.

Times, Jan 29, B1,4 HIGHER COSTS MAY CURTAIL M.T.A. WORK, by William Neuman, "Soaring construction costs could force the Metropolitan Transportation Authority to scrap plans for an architecturally-ambitious glass-domed subway station in lower Manhattan and lead to more than $1 BILLION in cost overruns for the authority’s major expansion projects, officials said Monday."

NY Sun, Jan 29, p2, MTA : FULTON CENTER COST HAS RISEN TO $1.15 BILLION, by Jared Irmas, "The MTA is reviewing several options to salvage the planned Fulton Street Transit Center in Lower Manhattan after announcing yesterday that cost estimates have grown to $1.15 BILLION from an original price tag of $750 million. "I am sad to say that we cannot build the Transit Center as currently envisioned in this market," the executive director of the MTA, Elliot Sander said.

Post, Jan 29, p3, MTA'S $900M BOONDOGGLE: FULTON TRANSIT-HUB PLAN COLLAPSES, by Patrick Gallahue, "The MTA has taken New Yorkers for a multimillion-dollar ride. A proposed $750 million Fulton Street transit hub - a soaring glass-domed building that was going to be the showplace of the neighborhood - has apparently gone the way of the token, grim-faced officials admitted yesterday.

The Jan 29 Post also ran a column by Steve Cuozzo on p3, YOU READ IT HERE FIRST: A DISASTER FROM THE GET-GO. "Yesterday, the MTA finally admitted that $900 million (and counting) in public money for the Fulton Street Transit Center has brought us a rat-infested, vacant lot. That's what now takes up the east side of Broadway between Fulton and John Streets, a once-bustling block in downtown's heart. The MTA admits it has no money left to build anything like the 'Grand Central' of lower Manhattan, as it was originally advertised."

Post, Jan 30, p22, MTA $25M HUB SCRUB, by Patrick Gallahue, "The MTA sank $25 million into designing a grand pavilion for its Fulton Street Transit Center that it now apparently can't afford to build.

News, Jan 29, p22, MTA BLDG. BOOM HITS 'MEGA' JAM - Projects Face $1B in Likely Budget Cuts, by Pete Donohue, "Rising construction costs may force the MTA to cut more than $1 BILLION worth of work from its "mega" projects -- including the Fulton Transit Center, the LIRR link to Grand Central Terminal and the Second Ave. subway, officials said yesterday. The first casualty may be the transit center, the authority's signature downtown project envisioned as a glass-domed "beacon" and an attraction in its own right."

News, Jan 30, p21, MTA BOTTOM LINE: FLOORS TOO PRICEY, Officials Say Granite, Porcelain Are Budget Busters, by Pete Donohue, ''FORGET THE GLITZ. Transit officials looking to save money may swap plans for fancy granite subway and train station floor tiles for a more economical -- and drab -- concrete."

News, Jan 30, p30, EDITORIAL, Monumental Waste. "The MTA's plan to build a stupendous, excessively expensive subway station on Fulton St. in lower Manhattan has run off the rails in one of the worst botches ever perpetrated by the agency. And that's saying a lot.

"The damage caused by the MTA's wrongheaded incompetence is nothing short of staggering. It starts with the flat-out waste of more than $150 milllion, and it reaches epic proportions with the fact that the MTA eliminated 140 small businesses from the neighborhood in service of its folly."

Newsday. Jan 29, A15, HIGH BIDS CHANGE MTA PLANS, by Steve Ritea, "Plagued by higher than expected construction bids on a number of its most ambitious capital projects, including bringing the Long Island Rail Road into Grand Central Terminal, MTA officials said yesterday they will look for ways to scale back and cut costs." 

OUR OWN VIEW OF THE PROBLEM

What can one say when one begged the authorities to do the right thing years ago and they refused to listen? Who is responsible for this mess? Mysore Nagaraja was the technician the suits relied on. He has retired, although they want him to stay a month to deface the architectural creation of his lifetime. Peter Kalikow was the MTA chair who supported the project with great intensity. He has been replaced by Governor Spitzer, but he Kalikow, who had no background in transit, should never have been been appointed by Governor Pataki.

He got the job for one reason - he was a crony of Senator D'Amato, who unquestionably got Governor Pataki elected in 1994 and was the most effective lobbyist in the state for the next twelve years. In 2006, he supported Spitzer over the Republican Party nominee, John Faso. D'Amato is a wise man.

There are others who share responsibility for the mess. The powerful Speaker, Sheldon Silver, could have stopped South Ferry, but he spoke at the groundbreaking. Now he wants it finished, regardless of cost.

The city had bargained away its control over lower Manhattan to Governor Pataki, so it could build the West Side stadium and expand the Javits Center. It would take another article to list all the mistakes made here, even as people warned the administration they were not following the right path. You can speak truth to power in a free country, but power need not listen when you speak, and in fact often does not, convinced as it is of its own intellectual superiority and purity of motive.

One of the blunders made here was renovating the South Ferry station, which has been adequate since 1912, if you follow directions and use the first five cars of each train. Railroad stations are built to last for centuries. "Don't worry," the MTA said, "it's all Federal money. "Yes, but if they hadn't spent it excavating Battery Park, tearing down dozens of mature trees in the park and paying 3% in mitigation rather than the 10% paid at the Bronx water tunnel site in Van Cortlandt Park.they might have had enough to finish the job at Fulton Street, or better still to help build the Second Avenue subway south of Canal Street. 

Capital projects however, have a momentum of their own, and where there is money to be made by contractors and their employees, the forces supporting a project are much stronger than the handful who recognize as waste. Ask Moses. This capital construction is New York City's version of Congressional earmarks..

Just as chickens come home to roost (not a rule although perhaps it should be 23-C, since it is a truth expressed in the activity of animals), eventually we must face the consequences of our actions. In this case, the escalation of construction costs has made a ludicrous situation into one that is very difficult to resolve.  We would ask Mr. Nagaraja, who really has been a very good public servant over the years, not to butcher his legacy by mutilating the dome. Let it sit for a while, until funds are found to finish it.  Speaker Silver will help, it is his district and he is the most powerful Democrat in the state.  Take the necessary money by dropping some other wasteful project that need not be undertaken except for show and tell.  Mysore, if they make you kill the baby you hatched we would be in a lose-lose situation; the BILLION dollars plus will have been spent, without even a thin dome to show for it.

In closing this essay on irrational expenditures, we must not forget that regardless of the city's folly, what the Port Authority is doing three blocks to the west is even more extravagant and more perversely wasteful. A new commuter subway station was just built. It opens in November 2003 (after the old station was destroyed on 9/11) at a cost of $322 million. It is an attractive and functional station. It works. The number of passengers using it daily, about 8000, is minimal, but it will rise with time and will increase further as more office buildings go up on the largely vacant site.   

To spend between two and three BILLION dollars in public funds on the Calatrava station is an absurdity. Anthony Shorris, executive director of the Port Authority, should explain why he is building this. He did not originate it and cannot yet be blamed for it, but is there anything he can do about it before the billions go down the drain? The chairman of the Port Authority board of a dozen commissioners, Anthony Coscia of New Jersey, Shorris' nominal boss, also owes the public an explanation. They could tell us, for example, what useful projects the Port Authority could advance if it was not burdened with building the most expensive subway station of all time.

This does not mean, however, that subway stations should be built on the cheap.   They are important public facilities, used by thousands every day.  Porcelain on some walls, tiles on the floors and public art are valuable amenities that contribute to public happiness, or at least tolerance, of the crowded rides they endure during ever-lengthening rush hours . Of course, when congestion pricing takes effect, and all the near-poor are chased from their cars to the subways, there will be room for them at rush hour, too.

What does one do when public officials make decisions which are misguided but not corrupt?   What we can do is write about it. What you can do is a more difficult question. We should both try to find ways that disinterested citizens can influence public policy from a city-wide perspective, as well as speaking up on behalf of particular communities, which is a more common intervention. We welcome your ideas.

#442 01.30.2008 2586wds