Bronx rail project a new frontier for transit-oriented development

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Fifteen miles from New York’s Hudson Yards — a new monument for real estate value capture — lies a less-glittering corridor that nonetheless could set its own tone for transit-oriented development.

Plans call for four Metro-North Railroad stations along an underused rail line in the East Bronx, one of the city’s last development frontiers.

It’s where commuter rail, long a curiosity item for subway-centric city residents, could boost mass transit revenues while fostering an outer-borough buildup. Climate resilience also factors into the mix through a redundant tunnel route into Manhattan's Penn Station. The latter was one of Gov. Andrew Cuomo’s initial selling points.

Other dynamics include interagency coordination in a region noted for transit tribalism, and the challenges of managing development and value-capture on a scale smaller than Hudson Yards.

Cuomo, who pitched the project in 2014, brokered an agreement in January among Amtrak, the state-run Metropolitan Transportation Authority — one of the largest municipal issuers with $41 billion in debt — and Empire State Development Corp., ending a stalemate with quasi-public Amtrak that lasted for about a year.

The Amtrak and MTA boards have signed off on a $35 million contract with HNTB New York Engineering and Architecture for the project’s design and development.

Getting Amtrak on board “was a stumbling block forever,” said acting MTA Chairman Fernando Ferrer, who championed transit expansion as Bronx borough president from 1987 to 2001. The new stops will be at Hunts Point, Parkchester/Van Nest, Morris Park and Co-op City.

“The one really interesting in terms of commercial and residential development is the one at Morris Park. That’s going to explode,” said Ferrer, who ran for mayor in 2001 and 2005. “And that’s a really big deal for the Bronx and the city. And the city’s been supportive of this.”

(Audio: MTA Acting Chairman Fernando Ferrer touts the Bronx rail project.)

High fares and infrequent service — huge burdens, especially, for shift workers in poorer neighborhoods — and the subway system’s omnipresence have made commuter rail within the five boroughs a tough sell.

“I grew up at the 149th Street and Southern Boulevard stop. I used to shine shoes there. So I know what a subway looks like,” said Ferrer, a lifelong Bronx resident. “I had no idea until well into adulthood what commuter rail was. And by the way, that’s most New Yorkers. They’ll see these tracks and trains whiz by and go … ‘what’s that about?’

“We want people to use this amenity.”

To promote commuter rail as an option, the MTA last year began a reduced-fare “freedom ticket” pilot program that allows riders on the Long Island Rail Road’s Atlantic Branch, which serves Brooklyn and Queens commuters, to buy a single fare for subway, bus and commuter rail service.

The MTA's 2015-2019 capital program contains an initial allocation of $695 million toward the East Bronx project, including $250 million in state resources through Empire State Development. The MTA is seeking additional funding for the project in its 2020-2024 capital program, which it will submit to a state review board later this year.

HNTB will advance the preliminary design, while developing project schedule and construction strategies. The contract also allows for different construction methods, which opens the door for possible design-build project delivery and public-private partnerships.

The new service will run Metro-North trains over the Hell Gate Bridge into Queens, where they will connect with a Long Island Rail Road route, traveling through East River tunnels into Manhattan and west to Penn Station. It's the route that carries Amtrak trains from Boston into New York.

The plan aims to mesh with the projected 2022 completion of East Side Access, a long-delayed undertaking that would bring the Long Island Rail Road to Grand Central Terminal on Manhattan’s East Side. That move will free up track capacity at Penn Station for the Metro-North trains.

As part of the agreement, Amtrak and MTA will jointly study the feasibility of Amtrak running several trains daily from Long Island to Penn Station and continuing either north to Boston or south to Washington.

“This will need a lot of coordination and working with Amtrak,” said Howard Cure, director of municipal bond research for Evercore Wealth Management.

Before the memorandum of understanding, Amtrak, which owns the tracks along the new route, was pushing for the state, through the MTA, to pay for more infrastructure improvements, notably for the decrepit the Pelham Bay bridge that lies northeast of the planned Co-op City station.

Amtrak, long regarded as prickly, also dropped its demand for rights fees over track use.

The Bronx accord, and its recent $182 million settlement with New Jersey to smooth out a longstanding debt with Amtrak, may signal the latter's willingness to work more agreeably at the local level.

“They are very dependent upon the federal government for funding and decisions,” Cure said. “They may be trying to cultivate state and local help to build up political capital. They need money for things like the Gateway project.”

Amtrak’s communications of late on Gateway, the stalled $30 billion Hudson River undertaking, is opening doors to other conversations, according to Nick Sifuentes, executive director of the Tri-State Transportation Campaign.

“The fight between MTA and Amtrak [over the Bronx project] was really long and protracted and it held things up, but now that we’re moving toward resolution, I think that project can get moving a lot faster,” he said.

At Hudson Yards, former Mayor Michael Bloomberg shepherded a rezoning that enabled a value-capture financing plan using special purpose bonds repaid from development-generated revenue streams and other sources, including payments in lieu of taxes.

About $6 billion in subsidies included more than $2 billion for extension of the No. 7 subway line 1.5 miles westward from Times Square. The station opened in September 2015, while the Hudson Yards complex itself opened to the public about a week ago.

“The question is, can the city do some value capture in these other areas to benefit the communities to help support projects?” Cure said. “The answer is yes, as opposed to the MTA shouldering the cost over the whole system.”

By contrast, New York Mayor Bill de Blasio’s planned north-south light rail west of the Brooklyn-Queens Expressway, the so-called BQX, has stalled over concerns that value capture would not provide enough revenue.

The culturally diverse East Bronx is home to Jacobi Medical Center and Montefiore Medical Center. A ferry route opened nearby last year.

Neighboring Co-op City, a collection of high-rise buildings in Baychester, has a population of roughly 66,000. Surrounded by highways and Amtrak’s rail line, it is nonetheless a “transit desert.”

Also in play is how de Blasio’s affordable-housing thrust intersects with transit development.

“The explosion and the possibilities of transit there are going to be just tremendous,” Sifuentes said. “So I think it’s going to be really important that we get our handle around how we actually handle that infrastructure work there.”

Successful transit-oriented development revolves around density, said Christof Spieler, author of the book "Trains, Buses, People: An Opinionated Atlas of U.S. Transit."

“The fundamental math of density leads to an obvious rule: put transit where the people are,” Spieler said. “Unfortunately, this is surprisingly uncommon. There are several reasons for this. Some older neighborhoods have lost population density over the past few decades, while others have gained.”

Merely building a lot of transit doesn’t make a good network, Spieler added.

“Many rail lines were separate overlays on existing bus networks,” he said. “But some cities, like Portland, Houston, Minneapolis and Seattle, are starting to see rail and bus as one network.

“Those cities have all built rail lines that are explicitly designed to benefit low-income neighborhoods, connecting people through jobs and education and offering current bus riders faster and more reliable trips.”

Whether to add rail lines where population now exists or build with future development in mind begs a chicken-or-egg question.

It surfaced in Charlotte, North Carolina’s most populous city. The Charlotte Area Transit System chose to route its new east-west light Silver Line to Charlotte Douglas International Airport along Interstate 277 north of the central business district rather than connect a tunnel directly to that district.

CATS leaders say they want to replicate the $2.7 billion worth of development along the existing north-south Blue Line.

While system officials cited tunnel costs and the promise of further development along I-277 near a neighborhood called NoDa, short for North Davidson Street, transit advocates protested. Shannon Binns, executive director of the smart-growth organization Sustain Charlotte, said commuters would balk at a route that would force them to walk several blocks or change trains.

“Transit — first and foremost, we believe — should serve riders and minimize travel time,” Binns said. “In this case, the ridership was not the top goal. It was economic development and we think that’s backwards.”

Charlotte’s planning department, meanwhile, is weighing an overhaul of the city’s TOD bylaws, including the encouragement of ground-floor retail along multi-level parking garages. Additionally, encouraging affordable-housing initiatives by easing height restrictions near transit could help banking hub Charlotte combat gentrification. Binns cited Seattle as an example.

“Almost every transit line has room for new development along it: vacant lots, surface parking, aging single-story retail, underused industrial tracts,” Spieler said.

“Even areas that already have density can be densified, and often the market supports dense new development in areas that already have an established residential market better than in relatively undeveloped areas.”

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Infrastructure Community development districts Public-private partnership Transportation industry Andrew Cuomo Metropolitan Transportation Authority Amtrak New York