Perils of Pataki: Tied to Tracks on Moynihan Station

Governor George Pataki’s aides are scrambling to get the jackhammers going at Moynihan Station in west midtown before Dec. 31, determined not to let yet another Pataki-legacy development project slide into the Spitzer era.

Things aren’t looking good.

Moynihan Station started out life as a comparatively modest renovation of the city’s main post office into an extension of Amtrak’s Pennsylvania Station, underground and across Eighth Avenue to the east.

Now the post-office renovation, named after the late Senator who was its greatest champion, is getting overshadowed by a gargantuan property shuffle proposed by the same private developers who were brought in to help finance the renovation.

The developers, Vornado Realty Trust and the Related Companies, are working on a deal that would move Madison Square Garden a block west, on top of the Farley Post Office Annex. On the two-block plaza where the arena now stands, a five-million-square-foot office complex would be built. Pennsylvania Station, now located underneath the Garden, would be made roomier and opened up to the sun via skylights.

When this bigger plan first surfaced, a smattering of civic groups, business associations and individuals who supported it said that the $865 million mini-Moynihan (the renovation of the post office) should proceed quickly while the business and tax details of the larger scheme got worked out. But two government officials—State Assembly Speaker Sheldon Silver and State Comptroller Alan Hevesi—have put the Governor on the defensive by questioning certain aspects of it.

“What we were presented with is not the same plan as what we are being asked to vote on.” Mr. Silver said. “I think there has to be a final presentation of the plan that is going to be built in order for us to vote on it.”

Without Mr. Silver’s assent, the state’s Public Authorities Control Board cannot agree to release the $86 million that the Governor has agreed to contribute to the project. The PACB postponed the vote in August and has not announced the agenda for its Sept. 20 meeting.

Two of Mr. Pataki’s aides working on mini-Moynihan—Charles Gargano, the chairman of the Empire State Development Corporation, and Robin Stout, the president of an ESDC subsidiary, the Moynihan Station Development Corporation—telephoned some of these groups to get them to lobby Mr. Silver, but with mixed success. According to the state agency overseeing the project, nine organizations have sent letters urging action on the smaller project. Along with five unions or contractor associations that are naturally in favor of construction work, the list notably includes the Real Estate Board of New York, the leading association of real-estate developers. But key constituencies, such as the Regional Plan Association, have not yet committed.

Earlier, Mr. Gargano released a letter from Related and Vornado saying, “The functional heart of the current Moynihan Station project can be built, and will have its own independent utility, regardless of what happens with Farley’s Annex.”

While that letter was meant to impress the movers and shakers who could exert pressure on Messrs. Silver and Hevesi, it also raised questions about just how far the developers would be able to get on the project if they moved ahead now before the unfinished status of the Garden deal interfered.

“This is not a ringing endorsement of the path we are on,” one government official said.

Kathryn Wylde, president and chief executive of the Partnership for New York City and the most vocal advocate for waiting for the entire Garden swap to come together, said, “The question was always whether the other part of it gets done. This is a project that has been many years in the making, but it has never worked as a great transportation hub because it didn’t have the site assemblage, so why go forward with a significant public expenditure when within a short period of time you could have a better product in place?”

The commuter and Amtrak train tracks at Penn Station extend westward under the Farley building now, and the Moynihan renovation would extend staircases downward and provide a more elegant, spacious access reminiscent of the original McKim Mead & White–designed Pennsylvania Station that was torn down 42 years ago. But critics say that even when fully functioning, Moynihan would accommodate only 30 percent of the hub’s passengers.

The potential delay bodes ill for the curators of Mr. Pataki’s record as he prepares to run for President. While his administration claims credit for the redevelopment of Times Square (a joint city-state project), more recent projects have come to less definitive ends: Queens West crawls along, Ground Zero keeps getting revised, and now Moynihan Station, supposedly a project with no enemies, is stumbling into the next Governor’s term. The first phase of the Javits Convention Center expansion got final approval in July only to see the Mayor and Senator Charles Schumer immediately call for the next phase to begin at the same time, saying in a press release he co-published with Mayor Bloomberg, “This additional work would add only limited construction time, while preventing the costly disruptions that a Phase II expansion would pose if begun later.”

The Governor has gotten a couple of parks underway—but then again, they are just parks.

But state officials expressed surprise that Mr. Silver believed that there were two plans out there when in fact the larger one, involving Madison Square Garden, is still only a “scheme.” The developers have not signed a contract with the Garden, only a memorandum of understanding, and Mayor Michael Bloomberg is refusing to give the Dolan family, the arena’s owners and his enemies in his failed quest for the West Side stadium, the tax breaks they reportedly need in order to actually move. Some insiders believe that delaying the project would benefit the Dolans.

Or it could be a matter of party politics. Mr. Silver’s willingness to postpone Moynihan indefinitely—or until a fellow Democrat comes into office—may be a ploy by the Assembly Speaker to earn a chit before Eliot Spitzer even wins the election. Mr. Spitzer’s spokeswoman, Christine Anderson, said the Attorney General does not favor a delay, but she added by e-mail, the project “lacked adequate preparation and left major questions unanswered about ongoing financial commitments by the state and other matters.”

Mr. Hevesi, the Comptroller, provided valuable political cover for both Mr. Silver and Mr. Spitzer last month when, in a letter to PACB members, he raised many questions, including who—the government or the private developers—would pay for the operation of the station. Mr. Stout said that the MSDC had responded to the letter, “line by line,” on Aug. 28, and explained that conservative financial projections show that his agency would be able to pay for station operations with revenues from tenants for the entire life of the project. A source briefed by the Mr. Hevesi’s office told The Observer that the Comptroller was still not satisfied with the response, but Mr. Stout said that he had not received any query for more information.

Neither Mr. Stout nor the Comptroller’s office would release the state agency’s Aug. 28 response.

The Regional Plan Association, a major civic organization that has long advocated for the station, was one of those approached by the ESDC recently for support, but has not yet endorsed going forward with mini-Moynihan first.

“What we said was, we’re interested in hearing the answers to all the questions that are out there,” R.P.A. president Robert Yaro told The Observer. “We are confident that the ESDC will provide the answers.”

Mr. Yaro said that he saw advantages to both the piecemeal and comprehensive approaches, since the full-fledged Penn Station revamp is “the big brass ring.” Yet redoing Penn Station would cost as much as $1 billion more, according to some estimates, and require another time-consuming hunt for money. (Currently, $550 million is coming from public sources.)

“There are a lot of competing projects and they all are looking for cash and they all have merits,” Mr. Yaro said, naming, among others, a Long Island Rail Road connection to Grand Central and the Second Avenue Subway. “None of them are fully funded. There is a lot of competition. Phase 1 of Moynihan is fully funded or very close and that is unusual.”

Another civic planning group, the Municipal Art Society, has voiced strong doubts about the larger Madison Square Garden swap and has strongly favored moving ahead with the Moynihan project while those details get worked out.

“Our position is, let’s get started,” said the society’s president, Kent Barwick. “It’s going to be a decade before everybody turns around …. Many, many parties have to advance to the point where the PACB will be able to operate on the larger project. You have to negotiate with the post office, the city has to negotiate with Madison Square Garden. If anybody is thinking they’re gong to be able to approve something in 90 days, that’s not the case.”