Port Authority's $10 Billion Bus Station Still Stuck in Neutral
The Port Authority of New York and New Jersey needs to speed up the slow-moving process to replace its Manhattan bus terminal, transportation experts say.
The Port Authority's board of commissioners voted on Feb. 16 to authorize the bi-state agency to start the first phase of a comprehensive planning process for a new midtown bus terminal.
The new facility is estimated to cost between $7 to $10 billion, but a $32 billion 10-year capital plan approved by the Port Authority at its Feb. 16 meeting only allocates $3.5 billion toward the project, drawing criticism from New Jersey lawmakers whose constituents utilize the station to commute into New York City for work.
"The bus terminal serves more commuters across the Hudson than rail," said Janna Chernetz, senior New Jersey policy analyst for the Tri-State Transportation Campaign. "There are currently proposals moving forward that don't need to be moving forward and that money could be allocated to the bus terminal.
The current 1950-built Port Authority Bus Terminal located on Manhattan's West Side last underwent a major expansion in 1979.
The structural slabs supporting bus operations will need to be replaced in 15-25 years, a process that will require a complete replacement of the terminal, according to the Port Authority. The bus station handles roughly 232,000 passenger trips and 7,800 bus movements each weekday with demand expected to rise 51% by 2040, according to Port Authority officials.
"They need to kick into overdrive with the bus terminal," said Chernetz. "There is a time constraint with the existing terminal."
Port Authority bonds are rated Aa3 by Moody's Investors Service and AA-minus by S&P Global Ratings and Fitch Ratings. The agency projected in its 2017 budget book that it would have roughly $20.4 billion of consolidated bonds outstanding as of Dec. 31, 2016.
The Port Authority board's planning process authorization includes hiring environmental and technical consultants to plan for a new bus terminal and evaluate interim solutions for the existing building. The planning will include identifying an optimal location based on engagement with impacted stakeholders in New York City and New Jersey.
Mitchell L. Moss, director of New York University's Rudin Center for Transportation and Management, said a new bus terminal is essential not just for the Port Authority but also for the regional economy. Moss urged the Port Authority and lawmakers to take a more proactive approach to expedite the project's completion given the aging state of the current terminal.
"New York City and New York State rely on the workers from New Jersey who come to Manhattan each day by bus," said Rudin. "These commuters are vital to the economy and to the income taxes collected by New York State."
Nicole Gelinas, a senior fellow at the Manhattan Institute for Policy Research, said the Port Authority has dragged the bus terminal replacement process out too long, contributing to rising costs and an increasing political divide between New Jersey and Manhattan.
She said other options for a bus terminal, such as a Secaucus, N.J. location that could link up with ferries or a 7 subway line extended under the Hudson, should have been studied more rather than focusing solely on a condensed area of Manhattan where real estate is limited.
"The more they are closed-minded, the longer it will take," said Gelinas of the Port Authority boxing itself in to just building a new terminal in midtown Manhattan without analyzing alternative locations that could be built in a shorter time period and cheaper. "They have had to navigate political divides during this process."
Five New Jersey state senators issued a statement in January critical of the Port Authority's bus terminal allocation in the 10-year capital plan saying it would result in a new facility not opening until 2028 or later. The agency initiated a design competition for a new terminal in October 2015 before delaying selecting a winner a year later in favor of expanding the planning process to include more New York City stakeholders.
Fitch wrote in a Feb. 23 report that ongoing pressures to Port Authority finances with new borrowings likely are a concern under the new 10-year capital program.
Debt levels of just above $11 billion are largely the same as the 2014-2023 capital plan, but annual debt service obligations for consolidated bonds are projected to rise 25% to nearly $1.4 billion in 2021, according to Fitch, though operating revenues are forecast to increase by a smaller growth rate of 3.3% annually through 2021.
Fitch analyst Seth Lehman said allocating only part of the costs for the bus terminal in the 10-year plan makes fiscal sense because the project will likely take longer than a decade to complete, considering it doesn't have a site identified and faces what are likely to be drawn-out planning and environmental approval processes.
Lehman said the agency is also tied down with other transportation priorities such as its $2.7 billion obligation to the Gateway Tunnel rail project under the Hudson River and $2.5 billion for infrastructure improvements at JFK and LaGuardia airports.
"The planning stage is going to be fairly long, which is why it's hard to determine what the total costs should be for 10 years," said Lehman. "They may not always have the all the revenues to get things done that they want to get done."
The Port Authority press office declined comment on its plans for the bus terminal beyond statements issued Feb. 16 after the board of commissioners authorized the start of a comprehensive planning process. The initiative includes evaluating potential intermediate bus staging and storage facilities to help the current terminal meet bus and passenger demand.
"We continue to acknowledge that, while the new Port Authority Bus Terminal is a critical first step in improving trans-Hudson commuting, it is only one piece of a menu of options that must be in place to meet the needs created by future demand increases," Port Authority Chairman John Degnan said in the statement after the Feb. 16 vote. "The Port Authority will work with our stakeholders to take their important views into account."