The estimated cost of the East Side Access for New York’s Metropolitan Transportation Authority has risen by another $1 billion and the completion date pushed back three years — at least.
“The real point is that the costs are now becoming an issue. It will be a continuing source of tension,” Mitchell Moss, director of the Rudin Center for Transportation Policy and Management at New York University, said Tuesday, one day after the MTA announced its newest timetable for linking Long Island Rail Road trains to Grand Central Terminal on Manhattan’s East Side. The trains now go only to Penn Station, on the West Side.
MTA executive director Joseph Lhota said Monday that the cost for the project has risen from an estimated $7.2 billion in 2009 to $8.2 billion. The expected completion date is now August 2019. He said there is an 80% chance of meeting those goals. The original benchmark for the project was 2013 for completion and a $6.3 billion price tag.
The new numbers further challenge the MTA’s enormous capital plan. Moody’s Investors Service said last month that without additional capital, borrowing will increase to fill part of the funding required of nearly $8 billion in the 2012-2014 portion of its capital program.
“Sizeable capital plan spending needs will result in increased leveraging of revenues for debt issuance,” Moody’s wrote.
Moody’s rates the authority’s bonds A2. Fitch Ratings and Standard & Poor’s each assign an equivalent A. The MTA has $32.5 million of debt outstanding as of April 10.
Benchmarks today are more accurate, Lhota said after Monday’s meeting of the MTA board’s capital projects oversight committee. “The era of looking at low and high projections and going with the middle number are over,” he said. “Those numbers have been consistently blown. We owe the public better than that.”
Lhota also said the numbers do not include $463 million for rolling stock, which is budgeted separately in a reserve account.
The U.S. Department of Transportation, meanwhile, has said it will begin its audit of the Federal Transit Administration’s oversight of the project by the end of the month. The office of inspector general Calvin Scovell 3d cited “significant cost increases and schedule delays.”
The FTA had committed nearly $2.7 billion to the project.
Asked to elaborate about the delays and rising costs, Lhota responded: “I think it’s the complexity of the project combined with all the issues that we’re finding on the Manhattan side, and more importantly on the Queens side.”
MTA capital construction president Michael Horodniceanu on Monday pointed to significant construction delays, notably the rebuilding and expansion at the Harold Interlocking switching station, a one-mile stretch of track and signals in the Sunnyside section of Queens borough that services 800 LIRR, Amtrak and even New Jersey Transit trains daily — NJTransit parks its unused trains there.
“Delays in Harold resulted in schedule compression that placed stress on resources and outages,” Horodniceanu said. Harold derives its name from nearby Harold Avenue, since renamed 39th Avenue.
Other projects, such as the Moynihan Station and East River tunnels, have further strained resources and outages, he added. He also told the board that cost and schedule contingencies have been largely consumed.
Moss, who likened the complexity of the project to the years-long Central Artrery project in Boston, known commonly as the Big Dig, stopped short of blaming the MTA. “Michael Horodniceanu is a terrific manager. He faces both an agency and physical challenges,” Moss said. “Anytime you have to negotiate with Long Island Rail Road and Amtrak, you’re going to have challenges.”
The MTA must construct its tunnel and platform roughly 500 feet below the existing one, for which Metro-North Railroad has rights of way.
“Anytime you’re building within an existing physical system, you have to be much more careful about disrupting those systems,” Moss added. “That’s always a challenge for great urban projects built within cities. We’re not talking about building something from scratch in the Mojave Desert or the Gobi Desert.”
Lhota, meanwhile, said the specter of a federal audit doesn’t worry him. “I look forward to it,” he said. “There’s nothing surprising about this at all.”
