A successful private-public partnership and one less soBy
When it comes to public-private partnerships, transit agencies and those in the private sector willing to participate have often struggled with their projects. We’ve seen some station rehabs succeed, some naming rights efforts falter and some private partners begin to understand why transit operators struggle with the finances.
In New York, one of the more problematic public-private partnerships has concerned the Atlantic Yards project. While more of a direct sale, Bruce Ratner’s obligations involved transit. In a nutshell, the MTA gave Ratner a sweetheart price for the air rights to the Vanderbilt Yards in Brooklyn with the original promise of a new nine-track train yard for $225 million. In 2009, the MTA agreed to a reduction in the size of the train yard. Ratner would have to build only a seven-track facility instead. A sweetheart deal had just gotten sweeter.
Now, we learn that despite a guaranteed delivery date of 2016, Ratner is facing delays in the construction of the train yard. As The Wall Street Journal reported last week, the delays are due to “higher-than-expected costs and a sluggish economy.” These same excuses have been percolating around the Vanderbilt Yards for years.
Brown had more:
Forest City spokesman Joseph DePlasco said the yard will still be completed on time. The developer has already built a portion of the yard, he said, and other related work will continue.
MTA spokesman Adam Lisberg said the developer has agreed to do $10 million of additional work in the interim, and the LIRR is using a temporary rail yard meanwhile. “From our perspective, very little is changing here,” Mr. Lisberg said…
Forest City had previously agreed with the MTA to get construction on the new yard fully underway by June 30. But in recent months, the developer sought to push off that date. They recently reached an agreement with the agency to push off that date until Dec. 31, 2013, the terms of which were disclosed to MTA board members this week.
I’m not quite prepared to draw too many sweeping generalizations here. The economy has indeed been sluggish, and the MTA can’t do any better with projects it oversees itself. For us to expect Ratner, who has been bleeding money for years, to do any better would be foolish. Still, this delay, which clearly risks the target completion date, is just another black eye for a project replete with them.
Meanwhile, in Boston, we learn of a public-private partnership done right. New Balance, the shoe giant, has pledged to fund a rail station in the Allston-Brighton area as part of a $500 million development plan in the area. The company will fund the $16 million commuter rail stop that will service its new headquarters, and this total includes “all permitting, design, construction and annual maintenance costs,” a Boston.com reporter said last week.
Here is a company that recognizes the need for a commuter rail stop and is willing to take the steps to see it through to reality. It’s possible then to form a public-private partnership that works, just like it’s possible to screw one up.