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New York Post

 

Head in the Clouds

October 22, 2012

By Nicole Gelinas

Mistakes in WTC rebuilding Mean PA can’t do its real job

One World Trade Center may symbolize not victory over terror but miserable commutes.

The Port Authority of New York and New Jersey, which owns both the skyscraper and the transportation links between the two states, has neglected its bridges, tunnels, trains and bus terminal to rebuild Downtown.

Rebuilding the World Trade Center was always going to be hard. But then-Gov. George Pataki (the NY and NJ governors control the Port Authority) made it a lot worse —and far more expensive.

With $20 billion pouring in from Washington, plus insurance, why not indulge starchitects dreaming of abstract-art skyscrapers and a "soaring" PATH-train hub? Someone else would pay — $1.3 billion for 1 WTC, $2 billion for the PATH station.

In 2006, the pols admitted they needed a redesign — but they never were honest about the cash.

Pataki & Co. (mostly him) burdened the Port Authority for decades. The agency took over 1WTC from developer Larry Silverstein, who also got PA financial help to build other towers at the site.

Today, 1 WTC will cost $3.9 billion. The PATH station has soared to $3.7 billion. And we can’t get back the federal money that pols spent on a sports museum and on the Bank of America and Goldman Sachs towers.

That’s how the Port Authority got caught on the hook for $7.7 billion (after money from other sources) for WTC rebuilding.

And it’s borrowed all that. In 2002, it owed $9.5 billion. Now, it owes $19 billion. And it won’t even start repaying some of those bonds until 2039.

It will be at least another decade before anyone knows whether the towers will repay their investments. The signs aren’t promising.

The complex will have high operating costs. In 2000, the last year of the old WTC’s operations, costs were $203.9 million ($272.8 million in today’s dollars). Without any buildings yet open for business, operating costs — not rebuilding costs — were $106.3 million last year. When the buildings are complete, it’ll be roughly $500 million a year.

To cover those bills, the agency would have to lease all the available office space in the two towers being built for at least $80 per square foot, nearly twice today’s rates.

The old WTC was profitable when Wall Street was growing. Today, Wall Street is contracting. Conde Nast, the tenant signed for one-third of the 1WTC space, is cost-cutting. The nearby World Financial Center is losing tenants to Midtown.

And tech firms — the ones that, if we’re lucky, will be the city’s new big growth industry — are happy with older, cheaper space. Their clients aren’t like the folks bankers call "muppets," impressed by fancy views.

But the muppets are folk who use New York and New Jersey transportation. And the Port Authority can’t offer them much.

Last year, the PA hiked tolls for the second time in three years. And now tolls are set to rise every year for the foreseeable future.

But the Port Authority can still barely keep up with maintenance on its Depression-era bridges and tunnels. Of the $25.1 billion that the PA has spent on capital investment since 2002, about $9.4 billion, or 38 percent, has gone toward WTC redevelopment. And WTC debt will leave less for future investment.

The agency ought to be spending on core projects.

Manhattan needs a new bus terminal; backups at the PA bus terminal force commuters to wait needlessly in long lines on a daily basis.

LaGuardia is desperate for the "state of the art" terminal that the PA has long promised, so that waiting travelers have a place to sit. JFK needs a faster ride to Midtown.

At Penn Station, NJ Transit and Amtrak travelers face delays. Two years after New Jersey Gov. Chris Christie canceled plans for it, New York and New Jersey still need another rail line.

Christie and New York’s Gov. Cuomo can do something. They can appoint to the authority’s board people who aren’t afraid to speak up, especially when the politicians won’t like what they hear.

Instead, Christie has appointed his former chief of staff, now a pharmaceutical-industry lobbyist. Cuomo has named the La Prensa and El Diario publisher.

Both governors also should disavow "regional programs" — pork —that have nothing to do with bi-state transit. Last year, such programs consumed $153 million, including $60 million on debt payments. It would have been enough to pay for a new bus terminal.

Last month, the Port Authority announced it might take over the Atlantic City airport — miles from the bi-state border. It’s another bailout for the casinos.

When New Yorkers and New Jerseyans look for someone to blame, politicians point to "the Port Authority."

The governors should point at their predecessors — and in the mirror.

Original Source: http://www.nypost.com/p/news/opinion/opedcolumnists/head_in_the_clouds_hbn6Q9JKjBT2mFPSn0tPQI

 

 
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