As the major players with stakes invested in the MTA’s capital plan gain a better sense of what the next few years hold, they have grown more willing to discuss the short- and long-term futures for the agency’s ambitious construction scope. We know the authority may scale back on mega-projects after 2014, and that’s a development sure to dismay the contractors and construction companies that benefit, perhaps too much so, from the MTA’s dollars.
Today, Streetsblog checks in with Denise Richardson, the head of the General Contractors Association and one-time MTA official. Richardson speaks of the fears the city had as Albany played chicken with the capital plan and the ways in which the federal government still has sway over the debate.
GCA members are still a bit wary of the House Republicans’ transportation bill, but the immediate focus is on debt. The big takeaway from Richardson:
DR: There has to be a very serious conversation about how to fund the MTA, which is part of the larger conversation about funding infrastructure nationally. We’re not the only place that’s having this debate. As we head into 2014 and the next MTA capital plan, we have to really talk about how we’re going to fund the MTA going forward.
This is a debt-laden capital plan. Everyone who follows the MTA knows that. To the MTA’s credit, what they’re doing is they’re paying off old debt while they take on new debt. The new debt has very favorable terms. Interest rates are as low as they’re ever going to be, so they’re swapping less favorable debt for more favorable debt. But it’s still debt and it still needs to paid. We have to look at a revenue source for the MTA that is stable, recurring and will be there.
With the threat of both federal and state spending drying up over the next few years — and the way such infrastructure spending may be tied into November’s presidential election — no one knows what the next five-year capital plan will resemble. Everyone involved though agrees: The debt situation is getting out of hand.
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