Jim O'Grady appears in the following:
Wednesday, December 19, 2012
(New York, NY - WNYC) Several months ago, NY Metropolitan Transportation Authority board member Charles Moerdler was droning on with objections to a change in a meeting schedule. The issue was minor and the room was warm -- one could be forgiven for mentally wandering ... or dozing off.
Moerdler wrapped up; Joe Lhota pounced.
"Chuck, I wish you would reconsider that position since your flawed thinking and the erroneous things you said are scurrilous."
Chins lifted off chests. What was this? Lhota continued.
"The lying to this board has got to stop!"
This was real. Moerdler looked mortified. But he rallied once Lhota had wrapped up his tongue-lashing. Moerdler replied by accusing Lhota of character assassination--remember, this began as a squabble about a meeting schedule--before concluding somewhat oddly, "I will not challenge you."
Lhota said, "Oh, I wish you would. Be a man!"
This was Lhota the politician, the guy who, as long-time deputy mayor to Rudy Giuliani, had an up-close view of power wielded as a blunt instrument. This was Lhota the alpha male making a calculated display not just to smack down Moerdler but to let others know that if you cross Joe Lhota, you could pay a price.
Lhota, who'll resign on Dec. 31, seems to have real feeling for New York City's transit system--he spoke movingly of damage done to it during Sandy. But he's no Jay Walder, his technocratic predecessor. Where Walder was bland, Lhota has been blunt.
Exhibit B would be Lhota's reaction to a court ruling in August that the payroll mobility tax, which accounts for almost 15 percent of the NY MTA budget, violates the state constitution. In response, Governor Andrew Cuomo issued a measured statement that took issue with the decision. Lhota, for his part, convened a full-blown press conference at Grand Central Terminal, where he attacked the judge who made the ruling, and the suburban legislators who brought the lawsuit that prompted it, as "flawed as well as erroneous."
Lhota came with a chart to show that the MTA subsidizes the average subway ride by a little more than a dollar while subsidizing the average Long Island Railroad rider by more than 7 dollars. Take that.
Even the way he launched his political career was aggressive. It has to be the first time a public figure to announce his intention to run for mayor only moments after presiding over a fare and toll hike. Asked by a reporter how that combination of events reflected on him, Lhota joked, "It's a profile in courage."
And what of his 357-day legacy as NY MTA chairman? Transportation advocates give him credit for several successes: restoring service quickly after Sandy, cutting overhead at the MTA by hundreds of millions of dollars, and bringing back $30 million in subway and bus service that had been cut in 2010.
Those same advocacy groups expressed grave concerns over the MTA budget, which depends on regular 7.5 percent fare and toll hikes--the next one is coming in 2015--and a capital plan funded by massive borrowing. In a statement, the groups sounded a warning:
"Earlier this year, the MTA borrowed $7 billion to help pay for the last two years – 2013 and 2014 – of its current construction program. The agency already spends $2 billion a year out of its $13 billion annual operating budget to pay off its existing $32 billion in debt. Debt service is projected to go up to $3 billion in future years."
Storm Sandy only made the situation worse. The federal government and insurance should pay for most of the estimated $4.75 billion in damage to the NY MTA's transportation system. But $950 million of infrastructure damage may need to be covered by the authority. Advocates point out, "that will come to $66 million a year in additional debt payments for decades to come."
The other unknown that Lhota leaves is the fate of the contract he's been negotiating with Transport Workers Union Local 100 since January. Lhota has said the biggest challenge to the NY MTA's budget are the fixed and rising costs of workers' pensions and healthcare. That's why he made it a priority to get off to a good start with union chief John Samuelsen, who, in the past, made no secret of despising Jay Walder. But now Lhota is leaving before a contract has been reached.
And that speaks to the issue of stability. Counting interim executives, the NY MTA has had six leaders in six years. A Twitter wag pointed out that Lhota today followed his post-Sandy analysis--"We still have a long way to go to get back to normal"--by essentially saying "See you!"
He's leaving to "explore" a run for mayor of New York. Perhaps his successor will stay longer than a year.
Wednesday, December 19, 2012
(UPDATED) Rare is the meeting of NY Metropolitan Transportation Authority at which the secondary story is a vote to raise fares and tolls. But that was the case on Wednesday morning, when NY MTA chairman Joe Lhota presided over the system's fourth price hike in four years before announcing he'd step down on Dec. 31 to "explore" a run for mayor.
First, the money side: starting March 1, New Yorkers will pay $30 for a weekly Metrocard and $112 for a monthly card. The base fare for buses and subways will rise to $2.50. Riders of commuter rail lines will see an eight to nine percent increase in ticket prices. Tolls on the authority's bridges and tunnels will go up by about the same amount.
The board voted to adopt Lhota's fare and toll hike recommendations. The board also approved Fernando Ferrer, former Bronx Borough President, as the new MTA vice chairman.
According to the MTA, its 2013 budget "assumes small cash balances available at the end of 2013 and 2014 that will be rolled forward to help address deficits in the following years that will nevertheless total more than $330 million by 2016."
Or, as the agency's official twitter account tweeted: "Our Board has adopted a 2013 budget that is fragile and faces risks, but is balanced."
Monday, December 17, 2012
(New York, NY - WNYC) The New York City subway system still has three large gaps in service due to damage by Sandy. The R train tunnel connecting Brooklyn and Manhattan is not operating, A train service into the Rockaways remains suspended, and the South Ferry station in Lower Manhattan is closed.
NY Metropolitan Transportation Authority spokesman Kevin Ortiz said the agency is "hoping" to have The R train tunnel, the last of eleven subway tunnels flooded by Sandy, back in business by Friday -- if repairs continue to go well.
The earthen berm supporting the causeway that carries the A train across Jamaica Bay into Rockaway Peninsula has been shored up: water no longer flows through two large breaches opened by the storm. But NYC Transit president Tom Prendergast says the tracks and signals won't be repaired until spring.
In the meantime, rush hour service on the Q53 bus will start a half hour earlier, at 4:30 a.m., to help relieve overcrowding from train commuters in the hard-hit Rockaways who now take the bus along Cross Bay Boulevard as a substitute for the A train.
And Prendergast says the authority is still doing a damage assessment on South Ferry station, which was renovated at a cost of $527 million and re-opened only three and a half years ago. It'll take at least another year before it opens again. The station was flooded floor to ceiling.
Monday, December 17, 2012
After weeks of battling insurance companies, including the FEMA-administered National Flood Insurance, Stephen Drimalas' determination is fraying.
Thursday, December 06, 2012
(New York, NY - WNYC) Following the death of a man pushed onto the subway tracks at the 49th Street station of the Q/N/R line in Manhattan, many New Yorkers are wondering about their best shot at survival in the unlikely event they wind up on the tracks.
There's basically no good option. But here are five of the best choices you could make.
1. Try to get back onto the platform. This is obvious. It's also the one piece of advice that a New York Metropolitan Transportation Authority spokesman would affirm. Other than that, the authority's standard response is to recommend riders stay away from the platform edge and contact a subway worker if an item is dropped on the track.
2. Moving away from the train could increase the odds of survival – it gives the motorman more time and space to hit the emergency brake and stop the train. And there are ladders and stairs at the ends of platforms. When this option was posed to an NY MTA spokesperson, he countered, "What if you trip?" The implication being that this is why the NY MTA doesn't give advice about escaping the tracks -- something could go wrong and the authority could be blamed for it.
3. Ducking under the platform or lying down on the tracks and fitting under the train, in the style of "Subway Hero" Wesley Autrey, doesn’t always work. Clearance varies from station to station. That's because the New York City subway was built over decades by a mix of private companies and municipal entities, often to differing specifications and designs. What works at an elevated station in the Bronx may not work at an underground station in Manhattan.
4. There may be set-backs in the walls that could provide shelter. Major caveat: A band of diagonal red and white stripes means there isn’t enough space for you and a passing train.
5. Getting to a space in the middle of two tracks, where workers sometimes shelter, entails stepping over the third rail. The “protection board” above the third rail is designed to deflect debris, not hold a person's weight. Don't step on it.
If you find yourself on a platform when someone is down on the tracks and can't help them up, signal the motorman in the approaching train by waving your arms. If you have a flashlight, pull it out and use it.
Station agents on elevated lines have a "kill switch" in their booth, according to a spokesman for TWU Local 100, which represents many New York subway workers. If alerted in time, an agent can use the switch to stop the train by cutting power to the third rail.
Last year, 146 people were struck by New York City subway trains – 47 were killed. In 2010, 146 people were struck and 51 killed. Considering that 1.6 billion people rode the subway last year, these are extremely rare events.
By comparison, in one recent 12-month period, 291 people were killed in traffic in New York.
Wednesday, December 05, 2012
"DOOMED" read yesterday's controversial New York Post cover. Tom McGeveran, editor of Capital New York who writes about the NYC tabloid wars, discusses the Post's decision to publish the photo of the pushed man. And Jim O'Grady, transportation reporter for WNYC, explains what we know about subway safety.
Do you have a reaction to the Post photograph? Got a question about subway safety? Call 212-433-9692 or post here.
Wednesday, December 05, 2012
Following the death of a man pushed onto the subway tracks, many New Yorkers are wondering what their best shot at survival in the unlikely event they wind up on the tracks.
Friday, November 30, 2012
(New York, NY - WNYC) Tolls on Port Authority bridges and tunnels are going up this weekend. Starting 3 am on Sunday, cash tolls will rise by a dollar to $13 at the George Washington Bridge, Holland and Lincoln Tunnels, and the three bridges connecting Staten Island to New Jersey.
Off peak E-ZPass rates for cars will increase 75 cents to $8.25. Peak rates will go from $9.50 to $10.25
The Port Authority of New York and New Jersey last raised tolls in September, 2011, and plans to raise them again next December. The authority says it needs the money to rebuild the World Trade Center, increase security at its facilities and make repairs like replacing the cables on the George Washington Bridge.
The Automobile Association of America (AAA), remains devoted to rolling back the hikes through a federal lawsuit that argues too much of the Port Authority's budget goes to projects that don't benefit motorists, like the $11 billion cost of rebuilding the World Trade Center.
AAA further claims everyone gets hurt when a trucker paying cash during rush hour has to fork over $75 to cross the George Washington Bridge, because the cost gets passed on to consumers. The association says drivers shoulder an unfair share of the cost of transportation through tolls, a gas tax and various fees. The lawsuit is ongoing.
In September, the ort Authority raised the PATH train fare by a quarter, to $2.25 per trip. The authority plans three more raises of a quarter between now and 2015. Some riders can't take the PATH train no matter how much they're willing to pay: service to and from Hoboken has been down since Sandy.
Wednesday, November 28, 2012
(New York, NY - WNYC) The NY Metropolitan Transportation Authority held a board meeting Wednesday -- its first after Sandy -- and the main topic was how to solve a conundrum: filling the $5 billion hole that the storm blew in the agency's budget while simultaneously rebuilding New York's damaged transportation system.
NY MTA Chairman Joe Lhota seemed determined to assure the public that the agency, at the very least, had a plan. He began by saying revenue will not be raised by additional increases to planned toll and fare hikes in 2013 and 2015.
"The burden of Sandy will not be upon our riders," he said. "I have an enormous amount of confidence in our federal government that we will receive a substantial amount of money to get us back to the condition of functionality we had the day before the storm."
He said he didn't expect to see service cutbacks--though he didn't rule them out--and that he'd stick to a pledge to add or restore $29 million in subway and bus service.
Lhota said he is expecting FEMA and insurance to pick up 75 percent of the $5 billion tab. And he's hoping FEMA will boosts its reimbursement up to 95 percent. But the MTA can't count on that. As of now, the authority is on the hook for $950 million, which it needs right away to rebuild.
They'll get it by issuing $950 million in bonds. Lhota said the move will add $125 million to the authority's debt burden over the next three years. The best Lhota could say about where the money would come from is "cost-cutting measures" that are "unidentified at this time."
The MTA is paying $2 billion dollars in debt service this year. By 2018, debt service is expected to gobble up 20 percent of the authority's revenue. That's before figuring in the nearly $1 billion in debt that it voted to add Wednesday.
Lhota said the budget setback would not stop the authority's megaprojects, which are funded by its capital program. The Second Avenue subway, the East Side Access tunnel between Long Island and Grand Central Terminal, and the 7 train extension are essentially funded and nearing completion. Sandy delayed their construction but didn't flood them.
Today's decision to bring on more debt raised an alarm with Gene Russianoff of the New York Straphangers Campaign, an advocacy group. "Funding these needs by MTA bonds will increase pressure on fares through increased debt service - and it sets a troubling precedent for the funding of the next five-year capital program starting in 2015," he said in a statement.
Lhota added that all of the $5 billion will be spent on restoring transit to its pre-Sandy state. (Repairing the South Ferry Station alone is projected to cost $600 million.) None of the funds will be used to harden the system against future storms. That's going to take a whole other pile of money that hasn't been located yet.
Tuesday, November 27, 2012
Monday, November 26, 2012
(New York, NY - WNYC) Seven of the eight subway tunnels flooded by Sandy are back in service. But New York City Transit president Tom Prendergast said it will probably be months before the authority finishes fixing the eighth tunnel, which carries the R train under the harbor between Brooklyn and Manhattan. He said the problem is with the tunnel's electrical systems, such as the switches that keep track of train locations.
"Electrical equipment doesn't like water for obvious reasons -- water is conductive," he told reporters at the Midtown headquarters of the NY Metropolitan Transportation Authority. "But salt water is very conductive and when salt water dries, it leaves salt, which is also conductive when it gets re-wet."
Prendergast said the authority does expect to get the R train running between 34th and Rector Streets--a normally busy stretch in Manhattan--within two weeks.
But he said the South Ferry subway station is also months away from re-opening. Sandy flooded that station to the ceiling, leaving little inside it untouched.
"You've got wall tiles that are down, you've got railings that are damaged," Prendergast said. "You've got possible damage behind wall surfaces, you've got electrical equipment in the form of elevators and escalators." (See a pic of drowning subway escalators here.) And as with the R train tunnel under the harbor, the station's electrical switches are coated in salt water and must be replaced.
The R train tunnel is one of the longest under-river crossings in the system and took more time to dry out, leaving more equipment damaged than in other tunnels.
A spokesman for New York Governor Andrew Cuomo said the MTA's price tag for damage caused by Sandy tops $5 billion.
(Click here to see what parts of the NYC subway system are still down.)
Tuesday, November 20, 2012
(New York, NY - WNYC) Poll results show that Superstorm Sandy has remade two kinds of landscapes in New York: physical and psychological. Beachfront is gone, trees are uprooted and whole communities have been forcibly rearranged by a monster tide. No less dramatically, a majority of New Yorkers are expressing love not only for their elected officials but everyone's favorite bureaucratic whipping boy, the NY Metropolitan Transportation Authority.
You read that correctly.
The latest Quinnipiac University poll finds 75 percent of New Yorkers rated the authority's performance during and after Sandy at "excellent" or "good." That's better than the Red Cross's 66 percent approval rating, and the dismal 37 percent approval for the region's utility companies, which struggled at times to bring the power back.
NY MTA chairman Joe Lhota was highly visible in the days and weeks following the storm as his workers methodically pumped out no less than seven under-river tunnels and, one by one, got them back to carrying trains and vehicular traffic.
The NY MTA also showed a fair degree of nimbleness by running shuttle buses over cross-river bridges until the subways were dried out. (Taking a cue, the NY Department of Transportation today announced its plan to run a temporary ferry from the hard-hit South Shore of Staten Island to Manhattan.) And the authority captured the public imagination with an online map that showed the the subway recovering in real time.
The Quinnipiac poll, which surveyed more than 1,000 registered voters in New York, also reported that Mayor Bloomberg's odd-even gas rationing system won favor by 85 to 12 percent. Other winners: President Obama, New York Governor Cuomo and, with the best numbers, New Jersey Governor Chris Christie. See the full results here.
Tuesday, November 13, 2012
(New York, NY - WNYC) Cars can now use one of the two tubes of the Hugh Carey Tunnel, formerly the Brooklyn-Battery Tunnel, in New York.
Governor Andrew Cuomo, who held a press conference at the mouth of the tunnel with NY MTA chief Joe Lhota and US Transportation Secretary Ray LaHood, said crews have worked around the clock to repair Sandy damage.
"When you saw this tunnel just a week ago, it was filled with water floor to ceiling," he recalled. "It defied belief, what was in this tunnel. And now 15 days later, one of the tubes will open."
Cuomo said both tubes of the 1.7 mile tunnel--the longest vehicular under-river crossing in North America--were flooded with 43 million gallons of debris-laden seawater that damaged electrical, lighting, communications, surveillance and ventilation systems.
The eastern tube -- the one usually dedicated to vehicles traveling from Brooklyn to Lower Manhattan -- is now open to Brooklyn-bound cars and buses for the evening commute from 3 pm to 7. Friday morning, it will be open for Manhattan-bound traffic during the morning rush between 6 and 10. No trucks are allowed for now.
The governor said the western tunnel suffered worse damage and will not be open for another "few weeks." With both tubes in operation, the tunnel normally carries 50,000 vehicles on an average weekday.
Cuomo is asking the federal government for $30 billion in disaster aid, including $3.5 billion to repair the metropolitan area's bridges, tunnels and subway and commuter rail lines. That request is pending. In the meantime, Transportation Secretary Ray LaHood is pitching in with $10 million from the highway trust fund.
At the press conference, LaHood explained: "I’m here because the president has said to us, 'Get to New York. Do what you can, when you can do it, as often as you can do it. Take your cues form the governor.'" He said the $10 million request was approved in two hours, before implying that President Obama will come bearing many more relief funds when he visits New York on Thursday.
When a reporter asked the governor whether the U.S. Department of Transportation could cover the whole price tag for the state's recovery from Sandy, Cuomo deadpanned to LaHood, "You don’t have $30 billion dollars, do you?" The answer was, no.
Thursday, November 08, 2012
Staten Islander Stephen Drimalas is one of thousands of New Yorkers who are still without power. He's digging out from Sandy, showing up sporadically to his city job and, as of Wednesday, riding out a nor'easter.
The 46-year-old Drimalas lives alone in a small house in Ocean Breeze, Staten Island, a neighborhood that the storm submerged under eight feet of water. He works for the city Department of Transportation, installing signs and Muni meters. Seven years ago, he moved from Brooklyn to this modest beachfront neighborhood on Staten Island's east shore because it was cheap, beautiful and near the water.
He knew flooding was a possibility. So a year ago, he built a new foundation and raised his house by four feet. The night Sandy hit, he stepped outside to smoke a cigarette and check on conditions.
"As soon as I opened the door, the water started pouring down," he said. "By the time I got to my car, the water was up to my shin. Another minute or two and I wasn't getting out. That's how fast it came in."
Drimalas fled with the clothes on his back and some papers he managed to grab. Everything else was destroyed, including a set of appliances he'd just loaded into his house at the end of a year-long renovation.
He escaped but his neighbor, 89-year-old Ella Norris, did not. "She lived with her daughter here on Buel," Drimalas said on Monday as he stood outside Ella's house, his neighbors circulating around him as they cleaned and salvaged what they could. "She and her daughter got trapped in the house. Her daughter survived. Ella's in the funeral home right now. They're having a service for her, as we speak."
Drimalas has spent the last ten days piling garbage on the street and digging out from the mud, calling FEMA and trying to contact his insurance company. On nights when a friend can't put him up, he sleeps in his car.
Now comes a nor'easter with snow and slashing rain, high winds and forecasts of flooding. When reached by cell phone, Drimalas described how he was preparing for a second blow.
"I'm getting all the garbage out in case any winds pick up," he said. He added that he was hoping to stay with a friend, before cutting short the call. "I'm working outside," he said. "I gotta go."
To see more photos of Drimalas and his neighborhood, go here.
Wednesday, November 07, 2012
Thursday, October 25, 2012
(New York, NY - WNYC) Joe Lhota, chairman of the NY Metropolitan Transportation Authority, was a guest on The Brian Lehrer Show Thursday, where he predictably resisted prompts to choose between two proposed flavors of subway and bus fare hikes: raising the base fare or the cost of unlimited cards.
"Reporters all want me to say what I want to do one way or the other," he said. "Here's what I want to do: I want to listen to the public." Eight public hearings on the fare and toll hikes will begin on November 7 in Long Island. Lhota said he'll participate in some of the hearings "until the wee hours of the morning," if necessary, to make sure every question has been answered.
(Go here for dates, times and directions to the hearings.)
Less predictably, Lhota held up President Ronald Reagan as an object lesson for Congressional Republicans who would cut mass transit funding. "We cannot be a car-only society," Lhota said, claiming that Reagan, too, "had that vision."
He then praised Reagan for dedicating six cents from an increase to the federal gas tax to mass transit.
"When I go to Washington and I talk to the folks in the majority in the House--and I have to deal with all of the Republicans, as well as the young Republicans who are part of The Tea Party movement--I'm constantly reminding them that the best and biggest supporter of mass transit in the 20th Century was Ronald Reagan," Lhota said.
Lhota also talked about Hurricane Sandy, which is expected to hit New York City on Monday. He said he'd already taken two conference calls to discuss preparations like "sandbags and getting buses to higher ground." But he didn't think he would have to shut down New York's subway and bus system, an unprecedented move that the authority took last year in advance of Hurricane Irene.
Listen to the entire interview:
Wednesday, October 24, 2012
"New technology is inherently risky," says the MTA's Craig Stewart in the testimony at a New York City Council hearing. "But public agencies such as ours are inherently risk-averse."
The NY Metropolitan Transportation Authority has installed subway countdown clocks at 156 stations on the numbered lines. They're popular, and riders want more. But the lettered lines have an outmoded signal system that can't relay the location of a moving train to a clock.
The exception is the L train, which got countdown clocks at all 24 of its stations during an overhaul of its signals that began in 2007. Throughout the subway, over 200 stations now provide some type of next-train arrival information.
The lettered lines have about double the number of stations and miles of track as do the numbered lines. An authority spokesman says fitting out the lettered lines with countdown clocks would cost $400 million and take 20 years.
In the meantime, the NY MTA is working on stopgap measures, like improving the public address system at 87 stations on the lettered lines so announcers can tell riders that their train is two or three stops away. The announcers will be working off dispatch and scheduling information, which is less reliable than knowing the location of a train. That's why the announcements won't tell passengers how many minutes until the arrival of their train, as do the countdown clocks.
Friday, October 19, 2012
(New York, NY - WNYC) - An analysis by the federal Department of Homeland Security shows that corrective action was taken for only 42% of the security breaches recorded at Newark Liberty International Airport between January 2010 and May 2011. That's the lowest grade of six major airports analyzed for the report, which blacked out the names of the other airports examined.
The breaches included a man gaining access to the "sterile," or most secure, area of a terminal, which shut down operations for six hours. In another incident, a dead dog was placed on a passenger plane without screening the cadaver for a bomb. Corrective actions after such incidents can include fines, reprimands, suspensions and firings of employees.
Newark Liberty International Airport is located 14 miles from Manhattan. About 33 million people traveled through it in 2010, making it one of the country’s busiest airports.
As with most U.S. airports, Newark's security screenings are conducted by staff with the federal Transportation Safety Administration. The report says most of the security breaches in which corrective action was not taken occurred in 2010, but goes on to add that security has been more aggressive: "Since 2010, Newark has improved efforts to correct security breach vulnerabilities."
New Jersey Senator Frank Lautenberg, who commissioned the report, concurred. "TSA has taken meaningful steps to improve performance," he said in a statement.
But the report goes on to slam the federal agency for its lack of coordination. "TSA does not have an effective mechanism in place to consolidate information about all security breaches and therefore cannot use information collected to monitor trends or make general improvements to security," say the report's authors. "It does not have a complete understanding of breaches occurring at the Nation’s airports and misses opportunities to strengthen aviation security.
Wednesday, October 17, 2012
(New York, NY - WNYC) With the company that owns the Yankee Stadium parking system staring down bankruptcy, Mayor Bloomberg called the situation "sad," and said his administration is "trying to help them."
Speaking during a press conference Q & A, the mayor addressed the issue of the stadium's foundering garages and lots, which have been only 42 percent full this season, according to this latest report.
"There just wasn't the business there that the owners, who made the investment, thought that there was going to be," the mayor said in answer to a question posed by a WNYC reporter. "If the owners of the parking garage can't make money, that's sad. We've got to find a way to help them."
The Bloomberg administration has already tried to help the company by having the city's Economic Development Corporation attempt to broker a deal with a real estate developer to build affordable housing and stores on some of the underused lots near an existing retail mall. But those talks have ended without a deal.
NYC EDC spokesman Kyle Sklerov wouldn't give specifics on the failed negotiations. Nor would he comment on an idea by Bronx Borough President Ruben Diaz Jr. to have the Bronx Parking Development Company build a hotel atop an empty garage. Sklerov would only say:“New options to develop the site will be considered moving forward as part of a larger effort by the BPDC board to get back on sound financial footing."
The scramble to find new revenue for the BPDC was set off by the company's long slide into default on $237 million in tax-free bonds. The NYC EDC acted as the conduit for those bonds, not the seller, so taxpayers aren't holding the debt.
Still, the default is a blow to the agency's reputation. Before the Yankees' new stadium was opened in 2009, Bronx residents and some civic groups tried to warn the city and the team that 9,000 parking spots spread across eleven lots and garages weren't needed. Their concerns went unheeded and the EDC facilitated the tax-free bonds that created a parking system sized to suit the Yankees' misguided desire.
The lots and garages have been underused--even during seasons, like this one, when the Yankees make the playoffs--and the BPDC is now in financial free fall.
Perhaps Mayor Bloomberg said it best when first asked at the press conference about the stadium parking: "Not everything works."
Thursday, October 11, 2012
(New York, NY - WNYC) The Yankees are in the playoffs after another successful season. But a key part of their stadium operation is a failure: the company that owns the Yankees Stadium parking garages has defaulted on more than $237 million in bonds.
The default means city taxpayers contributed about $39 million in subsidies to a project that is teetering on the brink of collapse. The city also spent $195 million to replace the parkland it gave to the Yankees, some of it now the site of languishing parking structures.
Financial advisor Edward Moran has told the Bronx Parking Development Company, a nonprofit that owns and operates the stadium parking system, that its cash flow can't keep up with its required payments to bondholders. Moran's analysis comes to a grim conclusion: “Unless debt service costs are lowered through a voluntary restructuring, bankruptcy will eventually be BPDC’s only option."
It is the Yankees' fourth season in their 50,287-seat stadium, a season that saw the team win its division while posting the second highest attendance in the major leagues. But the eleven parking lots and garages owned by the BPDC were only 43 percent full--and that's on game days. Other days, they're largely empty.
Most fans have been traveling to games by subway or taking a train to the new Metro-North station near the stadium. Others have looked for street parking or lots with prices lower then the $25 to $48 dollars charged by the stadium lots.
That means less money than expected for the company, which has been drawing from a reserve fund to pay off bondholders. That fund is all but depleted, which has thrown the company into default.
A source with knowledge of the company's finances tells TN that if bondholders can't be convinced to take less than the $15 million they're owed next year, the company is likely to declare bankruptcy. The next payment is due April 1.
Bettina Damiani of the advocacy group Good Jobs New York says Bronx residents tried to warn the city and the team that 9,000 parking spots weren't needed. "If only advocates and residents saying, 'I told you so,' would somehow make this go away," she said. "But the reality is officials and the Yankees refused to have anybody at the table on this decision."
The Yankees wouldn't comment for this story, except to say that the garages are owned and operated by a private company."The Yankees do not run them," spokeswoman Alice McGillion said.
But as TN has previously reported, the Yankees pushed hard in 2008 to add 2,000 parking spots, paving over parts of two nearby city parks to do it, even though the new stadium is smaller than the old one. The team made it a condition for staying in the Bronx.
Then Yankees president Randy Levine assured the City Council that despite the high cost of the new parking system, it would bring in sufficient revenue. "Those revenues will go back to pay the cost of the project and go to the city and a private operator," he said.
That hasn't been the case. Kyle Sklerov, a spokesman for the city's Economic Development Corporation, said that the BPDC owed the city $25.5 million in back rent and taxes as of the end of 2011. The company is obligated to pay its bondholders before it pays the city.
An arm of the city Economic Development Corporation approved the company's business plan before acting as the conduit for $237 million in tax exempt bonds. Sklerov said 5 percent of the corporation's bond issues are in default; the Yankee Stadium parking system has now joined that dubious list.
Marc LaVorgna, a spokesman for Mayor Bloomberg, said in an email that though the city will not be required to pay off the BPDC's debt, "we are going to continue to work with creditors to get the project back onto sound financial footing." He wouldn't give details on how that might be done. He referred TN to the city's Office of Management and Budget, which did not respond to repeated requests for comment.
Marlene Cintron, president of the Bronx Overall Economic Development Corporation, similarly refused comment. When asked whether the BPDC was in default, she said, "I’m not sure what the legal term is at this point in time."
In the meantime, Moran is telling the company that it "needs a dedicated manager and accounting person to control its operations." He also recommends wringing extra money from the parking spots during non-game days by pursuing deals with "circuses, ZipCar and auto dealer parking." BPDC attorney Steven Polivy didn't reply to emails and phone calls.
Damiani said the BPDC's default should be a lesson to the city. "If you're going to take your development cues from a corporation like the Yankees, I think it's safe to assume they don't have the residents' and the taxpayers' priorities in mind," she said, adding that "one of the lasting legacies of the Bloomberg administration, one of its most prominent economic development projects, is going down in flames."
The home games in the Yankees' playoff run will bring in more parking money. But then, the Yankees made the playoffs last year and that didn't prevent the company that runs the stadium's parking system from defaulting on $237 million of city-issued, tax exempt bonds.