Two years ago, the Port Authority was viewed by many in government as a plump cash cow—the riches of which could be spread to projects around New York and New Jersey.
And today? Not so much.
Facing an ever-rising tab at the World Trade Center site and a substantial drop in expected cash from tolls, the New York/New Jersey agency announced Thursday at its board meeting that its 10-year capital plan is being cut by $5 billion, bringing its size down to about $24.5 billion.
This move has been expected for some time, but it’s now official. On the chopping block: the potential for a new Central Terminal Building at LaGuardia Airport, to which the agency had previously committed $1 billion; a new $545 million bus garage meant to take busses off the streets of Manhattan’s West Side; and a redo of the entrance ramps to the Lincoln Tunnel. (In the world of budgets, capital projects like these are not officially canceled, only pushed to some unforeseeable future date.)
What didn’t change, however, was the money going toward the World Trade Center, which, as two years ago, accounted for about $8.5 billion of the agency’s capital plan (much of that is federal and insurance money). That number has been growing substantially, and depending on how an ongoing standoff at the site is settled (or isn’t settled) with private developer Larry Silverstein, it could grow far more. Rent from Mr. Silverstein’s three planned World Trade Center towers was to give the agency more than $80 million a year, a number that would escalate. But given that no one expects more than two of his towers to be built (and perhaps one or zero), his rent seems sure to change at some point.
The other main siphon of money: the $8.7 billion New Jersey Transit tunnel under the Hudson River, creating a new station just north of Penn Station. The Port Authority’s committed $3 billion toward this.
The agency did get something of a boost yesterday when the U.S. House passed a bill that would extend tax-free Liberty Bonds by a year. The availability of the bonds, which would help pay for the World Trade Center redevelopment, are set to expire at the end of the year. The bill was part of a larger bill that extended a variety of tax-related expirations.