Archive for May, 2010
May
20
MTA drops Goldman Sachs
Posted by: | CommentsFor years, the MTA has worked with financial giant Goldman Sachs on bond sales and other financial matters, but according to reports, the authority has opted to sever its relationship with the scandal-plagued company. Officials contend that Goldman’s recent legal troubles have nothing to do with the decision to drop a company that has made nearly $30 million off of the MTA since 2000. Instead, Board members have grown increasingly wary of Goldman’s handling of MTA assets. The financial giant had invested MTA money in, according to The Times, “assets that are considered more volatile than traditional fixed income arrangements,” and MTA officials did not approve of these risky interest rate swaps.
The writing was apparently on the wall for Goldman when its contract lapsed last year without a renewal. In February, the finance company dropped out of the Hudson Yards project as well. Said Gene Russianoff of this uncoupling, “The only entity in America that is less popular than the M.T.A. is Goldman Sachs.”
May
20
Examining a faulty contracting system
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The East Side Access project, not often in the news, made a headline for all the wrong reasons this morning. As William K. Rashbaum of The Times reports, New York Dirt Contracting, one of the project’s subcontractors that has earned over $2 million hauling away dirt, has been barred from doing business by the city’s Business Integrity Commission in because of the company’s close ties to organized crime.
In the short run, this development, says the MTA, won’t impact the timeline for the East Side Access tunnel. Another company will take its place in June. But for the MTA, this embarrassing development, in the words of Rashbaum, “underscores what some critics say is the authority’s persistent failure, despite its budget problems, to aggressively vet subcontractors in an industry where corruption, fraud and abuse are widespread.”
Referencing a February MTA inspector general report, Rushbaum writes:
In recent years, a steady stream of troubled companies have done work for the authority, which oversees the city subways; the commuter rail lines to Long Island, the counties north of the city and Connecticut; and many of the city’s bridges and tunnels.
The authority’s inspector general, Barry L. Kluger, has been lobbying to standardize the vetting process for contractors and subcontractors since 2008, when a moving company rejected by one of the authority’s constituent agencies because its owner had been convicted of racketeering was hired by another.
That case, Mr. Kluger said in a report last year, “brought to light certain systemic inconsistencies among M.T.A. agencies involving the depth of their due diligence reviews.” And, noting that well over 50 percent of the construction work for the authority was done by subcontractors, he said in an interview on Wednesday, “More attention must be given to the vetting of subcontractors in terms of both integrity and their performance on prior jobs.”
For its part, the MTA defended its business practices. It asks companies to respond to a questionnaire and cross-checks responses accordingly. However, as The Times notes, these companies are not asked to respond under oath, and in this instance, MTA Capital Construction had to make company determinations based on what amounts to an honor system. In this instance, the process failed.
Although this development concerns a subcontractor, I’ve often wondered about the MTA’s relationships with its contractors and the legislative mandate that the authority accept the lowest bids on all projects open to competitive bidding. Over the last few years, we’ve seen numerous instances of construction projects. We’ve seen the Second Ave. Subway fall four years behind its initial schedule. We’ve seen engineering errors at South Ferry delay the opening and later lead to leaky walls. We’ve seen costs raise across nearly every Capital Construction project, and we’ve seen other big-ticket items — the camera surveillance system and a plan to wire six stations for cell service — falter.
From a cost perspective, the MTA runs into more problems choosing the lowest bids than it would if it were able to select the most reliable company. We would probably see fewer missed deadlines, better quality of work and more efficient spending. Currently, MTA CEO and Chair Jay Walder is overhauling how the MTA does business, but in this instance, he would need legislative approval to do so. It probably won’t be forthcoming, but the MTA should explore how better to work with its contractors and how better to vet its subcontractors. If anything, the public would have more faith in the work.
May
19
To leave the lights on or not
Posted by: | CommentsAfter hammering the MTA on safety issues related to the move to eliminate 450 station agent positions, amNew York reversed course today and is now questioning one of the MTA’s decisions designed to improve station safety. The authority, says Heather Haddon, is spending money on lighting abandoned station areas. Haddon and Julia Borovskaya found numerous examples of areas with 55-watt Sylvanina fluorescent tubes but without pedestrian access.
While the free daily calculates an energy bill at one station of over $20,000, the authority defends its lighting practices. Officials say that the lights are “necessary for security purposes, particularly for employees working in closed areas and emergency responders responding to calls. It also would be too expensive to separate the circuits in closed sections of the stations from the public ones, a transit spokeswoman said.” Safety, it seems, is not inexpensive.
May
19
Samuelsen ups the MTA labor war ante
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Early last week, MTA CEO and Chairman Jay Walder took his attempts at getting the union to renegotiate work rules to the media and highlighted what he views as inefficiencies in the way union workers are scheduled. In response to this criticism and the MTA’s firings of hundreds of unionized workers, the TWU stationed an inflatable rat outside of Walder’s home. Today, TWU president John Samuelsen upped the ante in comments to the Daily News.
Slamming Walder while trying to protect his union members, Samuelsen went after Walder’s salary: “I bet you Walder has a Cadillac health plan and, not for nothing, he has the best severance package in the history of the public sector. I really can’t get past the hypocrisy of a rich guy coming into town, making $350,000 a year, with a wonderful severance package – he makes more money if he leaves than he does if he stays, almost, with a housing allowance – and he comes and talks about NYC Transit workers and antiquated work rules.”
Samuelsen — who eventually raises some good points about the way work rules are structured and his willingness to talk with MTA heads in private instead of through the media — isn’t doing himself any favors. Walder’s severance deal will kick in only if the State Senate pays him, and now they have an incentive not to. He won’t get a cent of that money if he isn’t booted out early. The salary, while seemingly high, pales in comparison with what a CEO at a private firm would make, and if New York wants to attract talent to head up the massive MTA, the authority will have to pay. We all want $350,000 a year, but to begrudge Walder those dollars is simply populism run amok.
With these statements, Samuelsen is doing exactly what he needs to do and should be doing: He is leading the union and fighting layoffs. At some point, though, these two sides have to get past their animosity and start talking to each other. Everyone stands to benefit from that discussion.
May
19
DOT set to study Red Hook trolley plans
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Could Brooklyn streetcars, now employed in San Francisco, make a return? (Photo by flickr user phrenologist)
Brooklyn, once the borough of streetcars, may see a nostalgic return to its transit-rich past if House representative Nydia Velazquez has her way. After sitting on $300,000 Velazquez appropriated for the NYC DOT in 2005, the Department of Transportation has announced plans to use this money on a study examining light rail or streetcar service for the now-isolated Red Hook area. Even though DOT has yet to get the study off the ground, Velazquez has already requested a House transit bill the $10 million the project is estimated to cost, reports The Post.
Rich Calder has more:
The city Transportation Department expects to select a consultant within the next two months to study running the mile-long line from the Red Hook waterfront to Atlantic Avenue at the edge of Brooklyn Bridge Park, which is in walking distance to several subway and bus lines. The study could also look at extending the route another half-mile east, directly to the transit hub at Borough Hall…
Velazquez said the project is crucial for Red Hook, since the isolated neighborhood is facing brutal service cuts to its already-limited bus service — the B61, B77 and B71 lines. The neighborhood has no subway; its nearest train line — the F — is more than a mile away….
Nearly a decade ago, the BHRA proposed a trolley route running from existing tracks at the Van Brunt Street waterfront, north up Richards Street and then Columbia Street, before hitting the park at Atlantic Avenue and then heading east to Borough Hall. Light-rail lines are much cheaper and quicker to build than subway lines and use far less energy. They run on existing streets, normally without the need to eliminate parking spots
For reasons that remain opaque, New York City has been resistant to the idea of bringing back a street-based system of transit that can outpace the sluggish bus system. A plan to incorporate light rail along 42nd St. has earned headlines as a novelty act, but few within the transit community and without take this idea seriously. Why not, I ask. After all, light rail is cheaper and more efficient than subway construction is today.
The Brooklyn waterfront and Red Hook, in particular, are ideal grounds for a light rail trial, but the DOT and MTA have to get it right. Most vital, as I discussed last year, are the connections between any new surface transit system and the current public transportation infrastructure. According to The Post, one route under consideration would rune from Red Hook to Atlantic Ave. along the waterfront with a terminal that is within “walking distance” from “several subway and bus lines.” The edge of the Brooklyn Bridge Park is a significant walk from the subway, and that’s simply not good enough.
Rather, the streetcars should take riders directly to the subway system. Unless DOT wants to construct a very thorough light rail system that services central business areas and provides interborough connections, it must connect Red Hook to either the F/G stop at Smith and 9th Sts. or Borough Hall (or both). Intermodal connections are key.
Of course, streetcars and light rail come with a downside. Unless the city is willing to build a San Francisco-Embarcadero style system with dedicated rights of way, streetcars are beholden to surface traffic ebb and flow. They are, in effect, buses on rails. They can’t navigate around car accidents or other stalled streetcars. They provide access but not speed or flexibility.
With subway construction in New York City prohibitively expensive these days, the city must look to other options in an effort to increase its transportation network. With this six-month study, something is finally getting a look it deserves. I’m not going to start waiting around for streetcars to return to Brooklyn quite yet though.
May
18
A mayor, not so aware, reveals his true transit stripes
Posted by: | CommentsJay Walder made headlines last week when he announced an MTA thought experiment. The authority, said the CEO and Chairman, may consider shutting large segments of train lines from Friday night until Monday morning to better expedite the weekend repairs. With larger chunks of routes closed for shorter periods of time, the MTA can be more productive with its capital improvements.
Into this fray went the supposedly pro-transit Mayor Michael Bloomberg. When reached for a comment, the third-term mayor who famously commutes via subway had the following to say to the Wall Street Journal: “I can think of only once in the last eight and a third years where we held for more than a minute or two,” Mr. Bloomberg said. “I never find any service interruptions.”
Bloomberg ran an appealing campaign for his third mayoral term by highlighting a 33-point plan to reform mass transit, but it’s clear that the mayor had no intentions to follow through. This statement simply highlights his mentality. Bloomberg has his drivers take him from his house to the subway, and he uses the 6 train for show during the work week. I’d love to know when the mayor last took a train ride on the weekend that involved service disruptions and diversions. As the MTA struggles along, we certainly shouldn’t expect the mayor to do it a thing about it. After all, the trains run on time for him.
May
18
LIRR service cuts now in place
Posted by: | CommentsWith little fanfare, the MTA implemented the first of this spring’s service cuts. Yesterday morning, new timetables for the Long Island Rail Road went into effect, and although the cuts are seemingly insubstantial, the commuter rail line just became a little less convenient for its riders. Generally, the cuts consist of the elimination of some overnight trains and peak trips, and the LIRR said that most riders will see waits increase by 10 minutes or less. Still, with these cuts into place, people will find it more burdensome to commute via rail. Trains will be more crowded and now run less frequently. If the purpose of mass transit is to provide convenient and cost-effective replacements for auto trips, cuts always run counter to that goal.
May
18
A funding failure on a national level
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A bus stop warns of impending service cuts. Photo by Benjamin Kabak
Throughout the country, signs such as the ones currently adorning New York City’s bus stops are popping up all over. While infrastructure investment may be up, transit authorities can’t meet their bottom line, and to avoid fiscal ruin, those who run transit systems are cutting service and employees. As transit use hits record highs for the auto era, a depressing map from Transportation For America shows just how widespread the service cuts are.
Why transportation authorities are in the red cuts to the heart of mass transit as a public good. To ensure relatively equal access to all, fares for buses, subways and light rail lines must be kept artificially low. While the demographics of New York City’s transit users do not line up well with the rest of the nation’s, throughout the country, people who are less well off are generally transit riders, and to keep the economy moving, transit fares cannot be prohibitively expenses. In an ideal world, the state would subsidize the difference between revenue and a $0 balance sheet.
But over the last few decades, transit authorities have come face-to-face with financial difficulties. Some of it can be blamed on a conservative government movement hesitant to invest in public goods. Some of it can be blamed on bad debt funding practices; some on rising pension obligations and management salary totals; and some on unfunded federal mandates. The bottom line is that, no matter the cost, transit authorities are broke, and the American people are suffering for it.
A recent editorial by Dan Grabauskas, a former GM at Boston’s MBTA, and Paul Regan, current executive director of the MBTA Advisory Board bring this national problem to light. In Boston, the MBTA faces a “$230 million structural deficit and $543 million in unfunded safety-critical projects.” In other words, despite the city’s willingness to spend billions on the Big Dig, it can’t find the money to ensure the T can run properly, efficiently and safely.
The two summarize the national crisis:
According to a 2010 survey by the American Public Transportation Association, 84 percent of all transit agencies have cut service or raised fares in the last year, or plan to do so in the near future. New York City faces a $800 million shortfall, and has implemented a plan to delay maintenance, and cut entire subway lines and bus routes; Chicago, facing a $300 million shortfall, has significantly reduced service on dozens of bus routes, and rail lines; Philadelphia has announced a 6 percent fare increase to help close a $110 million operating deficit; and Washington has a $189 million operating deficit for next year, with plans to balance it by using capital funds to pay for operating costs (thus deferring maintenance), as well as reducing some bus and rail service.
These “legacy’’ transit systems are starved by budgets in which escalating and intractable fixed costs outpace combined fare revenues and government subsidies. They are pressured by safety and reliability concerns resulting from deferred maintenance, and they face continuing calls for expansion without regard for how to pay to build, operate, or maintain the extensions, let alone the existing system.
Overall, the two urge transit authorities to invest in repairs and system maintenance — the so-called State of Good Repair — before eying ambitious expansion projects. One, though, should not come at the expense of another. The country’s transit networks must expand to meet environmental demands and the needs of growing urban population centers.
The two also urge public/private partnerships to encourage creative solutions to maintenance and construction challenges, and they call for an expansion of the funding available for public transit systems under the Intermodal Surface Transportation Efficiency Act. It might be too late for New York to avoid the upcoming service cuts, but as a nation’s transit systems suffer, it’s time for the federal government to act. Token stimulus dollars that can be used for operating expenses won’t cut it, but a true commitment to mass transit will.
May
17
MTA takes on experimental theater company over back rent
Posted by: | CommentsAs the MTA looks to maximize its revenue streams, the company’s myriad real estate holdings have come under the microscope. The 270 Jay St. building remains controversial, and the reduced payment for the Vanderbilt Yards have left many raising an eyebrow. Another property dispute — this one involving less money — made some headlines this morning. The authority has begun eviction procedures against 3-Legged Dog, an experimental theater and media troupe currently renting space from the MTA at 80 Greenwich St. The group, which signed a 20-year lease in 2002 after its home at 30 West Broadway was destroyed on Sept. 11, owes the MTA $21,666.67 a month and had fallen behind in its rent payments by $306,000.
The eviction notice did not arrive without controversy. With the company raising a stink, two politicians urged the MTA to reconsider. Supposedly, part of 3-Legged Dog’s debt stems from their need to pay for asbestos abatement on the MTA-owned building. The authority, however, says the troupe is overstating the cost of this work. “I don’t know how anyone can justify letting this tenant rack up hundreds of thousands of dollars in back rent at a time when state cuts and deteriorating tax revenues have forced the MTA to lay off station agents and cut service,” spokesman Jeremy Soffin said to the Wall Street Journal. This move is indeed a prime example of Jay Walder’s efforts to make every dollar count.
May
17
Look before you don’t leap
Posted by: | CommentsIt never makes sense to jump into the tracks. It doesn’t make sense to retrieve an iPod or a wallet, keys or a water bottle. Yet, over the last few months, a handful of straphangers have done just that, often with tragic results. Just last Friday, in fact, an N train killed a man who jumped into the track bed in Astoria to help his companion retrieve a jacket. Over the course of a year, nearly 90 are struck by trains, and most of those accidents occur when people value their material items over their lives.
Today, in The Times, Michael Grynbaum and Rebecca White explore track-jumpers. Some people laugh off the danger as the cost of living. “I can either pay $300 for a new Blackberry, or I can jump down on the track,” Sean Frawley told the paper. Others — and those at New York City Transit — underscore the foolishness of jumping onto tracks that are deeper than they appear. “It’s just not worth taking the risk,” Transit spokesman Paul Fleuranges. “In one instant the coast looks clear, and you think you can hop down, retrieve your item and hop back up. In reality, it’s not that simple.”
The lesson, of course, is an obvious one: It just isn’t worth it. I’d rather see my iPod or jacket run over by a train than my leg or entire body. But if Darwin is going to rule the day, the subway train tracks are a great place to find him.
Addendum: New York City Transit has covered this topic in its TransitTrax podcast series. The transcript of their pro-safety piece is available here, and you can grab the audio right here. Transit officials say workers respond to approximately 12-15 calls per day from straphangers who have dropped their iPods or wallets on the tracks.
