• City to spend $4M to rename a bridge · This morning, I spied a SubTalk poster urging me to “Celebrate the dedication of the Robert F. Kennedy Bridge.” It took me a good two minutes to figure out that the MTA was referring to the erstwhile Triborough Bridge. Now, according to CityRoom, the City of New York is set to spend $4 million over the next two years as they go about renaming the bridge after the former New York Senator and Massachusetts native. The funny thing about this expensive renaming outlay is that no one in New York is going to call this bridge by its proper name. It will always, to natives of this city, be the Triborough Bridge. (And anyway, it should have been named after Robert Moses. It was his bridge through and through.) · (11)

Over at The Launch Box, another subway blogger also named Ben charts the progress of the Second Ave. Subway launch box construction in pictures. In his latest post, Ben links to a CB 8 Second Ave. Subway task force presentation from the MTA. The slides, available here as a PDF, cover the architectural finish and design elements of Phase I of the SAS.

It’s hard not to get excited about this. These images show that the MTA is pretty far along in the planning and design stages of Phase I of this project. Might we actually have a Second Ave. Subway in the next eight to ten years? Without further ado, let’s jump in. All images can be enlarged by clicking.

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We start with architectural renderings of the mezzanine at 96th St. The station promises to be light and airy with substantial access points to the platforms and escalators all around. Signs are well marked and easy to read. I believe, though, that by the time this station opens, all available wallspace will be covered in ads. The stations will also be way more crowded than this.

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Moving above ground, we see something new from the MTA: open-plaza canopied stations with escalator access. These canopies are very reminiscent of the WMATA’s awnings that popped up in 2005-2006 after years of suffering escalator abuse at the hands of the elements. These SAS entrances are rather ostentatious considering the existing subtle subway entrances throughout the rest of the city.

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Above is the street-level view of the 94th St. entrances. According to the presentation, these entrances will feature curved edges and railings to facilitate pedestrian flow. They’ll be hard to miss and with adequate signage as well. Fancy shmancy.

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The entrances incorporated into preexisting buildings will be a bit more subtle. The one above is from the building currently at the northeast corner of 69th St. and 2nd. With entrances on both 69th St. and 2nd Ave., straphangers will have plenty of access points at just one of the station’s money entrances. As the PDF shows, each station will have an uptown and downtown entrance. (The 83rd St. entrance of the 86th St. stop has a mid-block access point.)

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Unfortunately, as astute Upper East Siders might have realized, that entrance at 69th St. and 2nd Ave. means the end of Patsy’s Pizzeria. The Yelp reviews are decidedly mixed.

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For the architects among us, the presentation also gets into details about the ancillary buildings the MTA is constructing at SW corner of 97th St., the NE corner of 93rd St., the NW corner of 86th St. and the NW corner of 83rd St. (with more to come). They’re kind of ugly, but the MTA has designed them to fit in as best as they can with the surrounding neighborhood. These buildings as, for better or worse, a necessary evil of the subway line.

So there you go. You can check out a street overview of the buildings and entrances the MTA plans on constructing. Who knows? Maybe by 2015, we’ll have that Second Ave. Subway after all.

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On Monday morning, when I ran a piece on the MTA’s global investments, I leveled some fairly serious charges at MTA CFO Gary Dellaverson and his investment strategy. Relying on information from an article in The Times, I questioned the MTA’s decision to pursue some high risk, high reward investments and in doing so, overstepped my bounds without discovering the full story.

I wrote, as my analysis:

Basically, in a nutshell, the MTA got greedy…All of this economics mumbo-jumbo leads me to believe that perhaps the MTA needs some new fiscal leadership. Perhaps Dellaverson, the man who invested the MTA into this mess, needs to go. Perhaps he just needs new economic advisers who don’t play fast and loose with rather important public infrastructure funds.

Yesterday, the MTA rightly accused me of spouting forth on a topic about which, at the time, I knew little. Jeremy Soffin, MTA spokesman, wrote me a correction in the form of a letter submitted to — but not yet published by The Times. It reads:

To the Editor:

While it is important to your readers to know how the global credit crisis is impacting government services, the November 2 article “From Midwest to M.T.A., Pain From Global Gamble” confuses the issue by comparing the MTA’s successful use of variable rate bonds to riskier investment schemes.

The story implies that the M.T.A. was “wooed by bankers” to pursue variable rate bonds, but the agency has used these bonds to diversify its traditional fixed-rate debt since the 1980s. This mix provides the most cost effective financing for the MTA’s capital program of over $23 billion, with variable rate bonds saving the agency nearly $44 million just this year alone.

The M.T.A. did what was prudent for any governmental issuer of its size – it compiled a list of qualified banks, selected not on the quality of the sales pitch, but on market acceptance and ratings of the institution. The M.T.A. currently uses fourteen major domestic and international banks in its variable rate portfolio, of which Depfa is but one.

As the MTA continues to grapple with the volatility in the financial sector as well as the impact of the economic slowdown on the ‘real’ economy, it will keep its riders interests first and foremost by managing risk with supplier and product diversification.

In my post, I didn’t take the full economic picture into account. What the MTA did in investing in variable rate bonds was what millions of Americans do with their 401(k) plans. They diversified their holdings to spread out the risk in an effort that should have achieved maximum growth. If this one investment didn’t work — and that is a point I’ll get to soon — it has nothing to do with irresponsible investing or greedy officials and everything to do with the fact that, sometimes, investments don’t work out.

But on the other hand, while The Times article didn’t focus on this, as the MTA stresses, these investments works. The variable rate bonds saved the agency $44 million alone.

The other piece of this post and The Times article focused on concerns about the MTA’s debt payments, but these payments aren’t increasing because Depfa — the bank holding just one of the MTA’s many investments — is suffering. The debt is increasing because the MTA has had to borrow to finance its much-needed capital campaign.

While the article mentions a potential $12 million in fees to Depfa, the MTA believes this figure represents a worst-case scenario, and authority officials do not believe it will come to that. The MTA’s financial team is much more concerned with higher interest rates on their recent bond issue and the current disruption in the credit market than with what figures to be a relatively small payout to Depfa, if it even comes to that.

So in the end, I have to issue an apology to the MTA and Gary Dellaverson. I took the information from The Times’ article at face value when the MTA had a story to tell about their investments too that doesn’t make the authority look nearly as bad as I made it out to be. In reality, Dellaverson has done an admirable job spreading the risk at a time when the MTA really needs an outside infusion of cash. Monday’s post represented sloppy reporting by me, and my readers and the agency about which I write deserve better.

Categories : MTA Economics
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  • The election returns and transit · Mobilizing the Region takes a look at what last night’s local and national election returns mean for transit investment in the Tri-State area. With Democrats in power just about everywhere, the Tri-State Transportation Campaign sees good things ahead for transit in New York. · (0)

I first started this blog nearly two years ago when Democrats, thanks in large part to the efforts of New York’s own Chuck Schumer, won the midterm elections. At the time, it seemed as though the party would deliver an urban-oriented policy with urban investments.

Two years later, my intuitions were correct. The MTA has seen an influx of investment in capital expansion projects from both the federal government and the city. While the federal money will spur on at least the first part of the Second Ave. subway and the city will pay for the 7 line extension to the Hudson Yards, a slow economy has derailed more investment in transit. It was, in 2006, a bittersweet victory then. The promise for support was there; the economic conditions failed to materialize.

Tonight, as we all witnessed a historic investment, those of us trumpeting urban policies, those of us urging for substantial investment in public transit and national infrastructure have a reason to smile. Barack Obama, a very urban-oriented candidate, won because urban voters turned out to support him. His vice president, Joe Biden, is one of the nation’s greatest proponents of its sagging rail system. This could truly be a watershed election for supporters of public transportation and rational infrastructure investment.

Of course, it is right now too early to tell what the future will hold. Our President-elect does not have an easy road ahead of him. America is still embroiled in two overseas wars; the economy is stagnating; the environment isn’t going to fix itself. But as more and more economists have recommended over the last few days, the next president should look to begin an economic recovery program by investing in cities and by investing in infrastructure.

For New York, arguably the center of America’s economy, this means an increased attention to the state of our transit network. This means better and faster transit into and out of the central business district of Manhattan. This could mean more money for the subways, more money for our aging and inadequate river crossings, more money for the commuter rail options and airports that feed our city.

It’s been a rough few months for the MTA. The organization is teetering on the brink of financial collapse. It needs millions of even billions more than it has access to, and it’s about to ram us all with a second fare hike in two years. But tonight, there is a glimmer of hope on the horizon. Perhaps, just perhaps, federal investment in our infrastructure will be that bright light at the end of the proverbial tunnel.

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Nearly a year ago, news came out that the MTA and its technology firms were at odds over a few key technology projects. The contractors could not figure out how to implement a GPS-based bus location system in New York and was, at the time, 16 months behind schedule.

Now, according to Pete Donohue, the GPS projects appears to be dying a slow, slow death. The Daily News transit scribe writes:

NYC Transit may pull the plug on a troubled $99 million project to track buses and post “real” arrival times on bus-stop message boards, the Daily News has learned. Officials have halted some work “pending a decision on the future of the project,” according to a report by the agency’s outside engineering consultant.

NYC Transit lawyers also are reviewing legal options, according to the report, which says the contractor is two years behind schedule and still having technical problems with the GPS tracking system. “It’s a dirty, rotten shame,” Gene Russianoff of the Straphangers Campaign said. “A bus locator system could greatly improve bus service with better dispatching and more real-time information. If your car’s GPS can guide you around town, I don’t see why buses can’t do the same.”

The report by the Carter-Burgess engineering firm refers to problems in general terms, citing software issues, a high failure rate of onboard equipment and inaccurate arrival times relayed to message boards placed on just a handful of routes in Manhattan so far.

The MTA has recently turned off a test-run of the program, but the contractors are still claiming that they are within the contractual requirements.

No matter how this ends up, one thing is certain: As the MTA moves forward with technological investments, the agency and its contractors have to be on the same page. Other transit systems in cities with tall buildings have GPS-based bus systems; other subway systems older than ours have train arrival boards. It’s time for New York to get these features, but these technology projects seem to be stalled out.

Categories : MTA Technology
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For the Metropolitan Transportation Authority, the sale of the Hudson Yards space basically represents free money. All they have to do is sign the contract for the rights to develop the 26 acres on the far West Side above the train tracks, and $1 billion will be theirs.

But for months, the MTA has sat on this deal they have worked out with Related, and now the transit agency is blaming no one but themselves. Via Eliot Brown at The New York Observer’s The Real Estate blog comes the odd news:

The deal to put $15 billion in residential and commercial development atop the M.T.A.’s West Side rail yards has hit a delay, as the agency will not sign a contract with developer Related Companies this week, as was originally scheduled. The state authority says it has reached an agreement with Related (which is in a joint venture with Goldman Sachs) to push back the deadline for signing a contract for the property by another 90 days, as the M.T.A. has been slower than expected in producing the needed paperwork.

“We have together agreed on an extension of the designation period,” said Gary Dellaverson, the CFO of the M.T.A. (who has to have one of the least enviable jobs in government these days). “Our expectation was that the documents would have been turned a month and a half ago.

“This is my fault—the fault of the M.T.A.,” he said. “This is not a product of either Related or Goldman or their lawyers.”

For his part, Dellaverson doesn’t believe the economic slowdown will force Related’s hand. “I don’t have any indication, and they haven’t brought anything to me that would indicate slowness or desire to delay on their part,” he said to Brown. “Everything that I’ve seen, is they’re continuing to operate in good faith and pursuant to a desire to consummate the transaction.”

Now, this confidence is all well and good, but this news — coupled with yesterday’s examination into Dellaverson’s risky investment strategy — makes for a rough week for the MTA’s CFO.

It’s not a good time to be in charge of money, but so far this week, as the MTA heads into an emergency budget meeting next week, we’ve learned that Dellaverson OK’d some risky investment strategies and hasn’t yet seen fit to push forward on a $1 billion windfall deal for the MTA. What other motivation could the MTA’s money man need?

Categories : Hudson Yards
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“Scores Killed or Maimed in Brighton Tunnel Wreck,” screamed the Page One story in The Times on Saturday, November 2, 1918. The night before, a speeding train crashed coming around a sharp curve in the Malbone St. tunnel on the Brighton Line. Over 90 people died, and the accident remains the single deadliest crash in New York City transit history.

For weeks and months afterwards, the Malbone St. crash dominated the news, and the details are rather gruesome:

A Brighton Beach Train of the Brooklyn Rapid Transit Company, made up of five wooden cars of the oldest type in use, which was speeding with a rush hour crowd to make up lost time on its way from Park Row to Coney Island, jumped the track shortly before 7 o’clock last evening on a sharp curve approaching the tunnel at Malbone Street, in Brooklyn, and plunged into a concrete partition between the north and south bound tracks…

The first car left the rails a few feet in front of the opening of the tunnel and rammed one end of a concrete partition separating the northbound from the southbound tracks. It was thrown at right angles across the roadbed in front of the entrance to the tunnel. The other cars cut right through it, the second car smashing it to bits and the whole train passing over the wreckage and coming to a stop 200 feet down the tracks inside the tunnel.

Packed together as in a box without structural strength to give them any protection, the passengers in the first car were crushed and cut to pieces. Not one is believed to have escaped. After breaking through the first car, the rest of the train dashed it against the partition wall and strewed wreckage and passengers along the tracks ahead, where the wheels of the cars following passed over them. Only splintered fragments of wood and broken and twisted bits of iron and steel remained of the first car.

The second and third cars, leaving the rails after their impact with the first, ran sidewise into a series of iron pillars supporting the roof of the tunnel at intervals beside the partition. The pillars cut great gashes in the sides of the cars, which were still traveling at high speed, and mowed down the passengers who were standing striking the heads of some from their bodies.

The left sides of the second and third cars were stripped away. Scores of men, women, and children were flung by the impact out of these cars against pillars and the concrete wall, where they were killed instantly or ground under the wheels after falling back upon the tracks. Some who were not flung from the car were killed inside when they fell upon the broken iron of seats, splintered timbers and iron beams which projected through the shattered bottoms of the car. Passengers on the platforms were nearly all killed instantly. One dead man was found impaled on a broken bar of iron, which had run underneath the car, but which broke and shot up into the air like a javelin in the crash.

Furthermore, the impact on the B.R.T. company and the concurrent motorman strike was immediate. Police arrested B.R.T. officials, and the motorman strike ended a few hours later. Over the next few months, Brooklyn grappled with this horrendous accident. At one point, nearly everyone in Brooklyn knew someone impacted by the crash, and in the aftermath, the city changed the name of Malbone St. to Empire Boulevard. The connection between the crash and the name of the street would forever scar the victims’ friends, neighbors and family.

Today, what is rather remarkable about the famed Malbone St. crash is how it has largely been lost to time. The BMT Brighton Line now runs a slightly different route, and the extremely sharp curve is now a part of the Franklin Ave. Shuttle tracks. The tunnel and tracks themselves are rarely used, and the accident is rarely mentioned in the history of the city.

Over the weekend, Flatbush Gardener memorialized the accident by remembering every single victim. It is a fitting tribute to one the city’s most tragic events.

For the full text of The Times article, click here.

Categories : Subway History
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  • Riding the haunted rail · Halloween on a Friday in New York City is always a dangerous proposition. The entire village is virtually shut down, and everyone’s out and about celebrating the season of the witch. The subways make for a particularly entertaining backdrop as costumed revelers board the trains dressed up. The Subchat thread featuring scenes from Halloween is a particularly fun one. Of course, on the subways, sometimes everyday is Halloween. · (1)

For the non-economists among us, variable-rate bonds are not very easy to understand. In sum, these stem from adjustable-rote loans in which the initial payments are low but can change over time. As we’ve recently learned, this change can be for the worse.

In Sunday’s New York Times, Charles Duhigg and Carter Dougherty explored how these adjustable-rate loans and variable-rate bonds from one bank in Ireland are impacting the MTA. The tale they weave is one of fiscal recklessness and global impact:

For years, municipal agencies like the M.T.A. had raised money by issuing plain-vanilla bonds with fixed interest rates. But then bankers began telling officials that there was a way to get cheaper financing…

The transportation authority, guided by Gary Dellaverson, a rumpled, cigarillo-smoking chief financial officer, had $3.75 billion of variable-rate debt outstanding. About $200 million of that debt was backed by Depfa. When the bank was downgraded, investors dumped those transportation bonds, because of worries they would get stuck with them if Depfa’s problems worsened. Depfa was forced to buy $150 million of them, and bonds worth billions of dollars issued by other municipalities.

Then came the twist: Depfa’s contracts said that if it bought back bonds, the municipalities had to pay a higher-than-average interest rate. The New York transportation authority’s repayment obligation could eventually balloon by about $12 million a year on the Depfa loans alone.

Basically, in a nutshell, the MTA got greedy. They could have plodded along with their regular bonds with fixed interest rates. These bonds, backed by the U.S. Government, could have served the MTA well even if they were not quite as efficiently sexy as the Depfa bonds. Now the risks are coming back to bite hard.

For their part, the MTA alleges that, for this year, it is within its debt-payment budget, but as we’ve seen time and again over the last six months, those debt payments could cripple the MTA over the next few years. While this year’s payments may be on pace, the subsequent years’ payments will be impacted by this financial crunch.

All of this economics mumbo-jumbo leads me to believe that perhaps the MTA needs some new fiscal leadership. Perhaps Dellaverson, the man who invested the MTA into this mess, needs to go. Perhaps he just needs new economic advisers who don’t play fast and loose with rather important public infrastructure funds. There is, after all, no such thing as a free lunch whether you’re a homeowner looking for a cut-rate mortgage or a cash-strapped public transit system beholden to millions of passengers each day.

Categories : MTA Economics
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