Photo by: Marc Fader

A dark corner of Penn Station. There are plans for a dramatic expansion of capacity at this hub for Long-Island railroad and Amtrak commuters, but much hinges on whether federal funding arrives.

On incoming commuter trains at rush hour, platforms are so crowded that swarms of passengers may spend more than 10 minutes merely shuffling off the platform. Long-distance Amtrak passengers share the terminal with Long Island Rail Road and New Jersey Transit commuters, causing backups and dampening dreams of high-speed rail on Amtrak’s busiest corridor. And though more than 550,000 people use the station every day, it is isolated from much of the city’s office and commercial activity, with the surrounding blocks relatively undistinguished for services or attractions. Pennsylvania Station is, decidedly, the transportation hub of the past.

Yet modernization of the nation’s busiest train station proved stunningly elusive until a recent infusion of federal stimulus cash for renovations and a new train hall known as Moynihan Station. More than 71 percent of the plan’s entire first phase was paid for by the federal government—nearly $110 million in transportation funds, plus $83 million from the stimulus. That money was an enormous boon to a project that supporters hope will increase transit ridership and help revitalize the far West Side, allowing groundbreaking to finally take place in 2010. But it is also a striking reminder of how integral federal dollars can be to the city’s major infrastructure projects, whose worthiness may be proportional to their staggering expense.

But even as New Yorkers may see the first phase of transit improvements taking shape—from Moynihan Station to the Second Avenue subway, from an extended No. 7 line to a link between the LIRR and Grand Central Terminal—the future of federal funding for these projects is very much at risk. The Republican-led House of Representatives has proposed significant cuts to transit, and the relevant portion of President Obama’s American Jobs bill, which includes an extra $4 billion for high-speed rail, appears unlikely to gain approval. The upcoming election, which could swing the balance of power in Congress and the White House, casts a long shadow of uncertainty over future funding.

“The 2012 elections, both presidential and Congress, will decide the fate of infrastructure funding in the country, not just Moynihan,” says Timothy Gilchrist, president of the Moynihan Station Development Corp.

A Long Ride

It’s been nearly two decades since Sen. Daniel Patrick Moynihan first introduced the concept of an ambitious new terminal that would both streamline transportation and befit the city it serves. According to the Regional Plan Association (RPA), Moynihan sold newspapers and shined shoes as a boy in the former Penn Station, with its glass-and-steel train sheds and soaring main lobby inspired by the Roman Baths of Caracalla. The station was razed in 1963, and its replacement has long been decried by historians, architects, planners and politicians alike as inefficient, inhospitable and increasingly inadequate.

The current plan—scaled down and tweaked over the years since it was first floated—calls for the building of a new train hall for Amtrak in the James A. Farley Post Office building, on Eighth Avenue between 31st and 33rd streets. This move, which is not currently funded, would cost an estimated $1 billion to $1.5 billion, according to the RPA. Amtrak could then separate its operations from the busy commuter lines at Penn and move forward with its master plan of increasing service and ridership. A new train hall would also help pave the way for high-speed rail along the Washington–New York–Boston line, which is now hindered by, among other obstacles, the fact that slower commuter trains share the same tracks.

“I don’t think anybody could ever claim that the project is not worth it. Economically, it’s just a question of finding the money up front,” says Juliette Michaelson, director of strategic initiatives at the RPA. “New York State ought to participate. New York City ought to participate. But in these economic times, I can’t really expect them to … There’s still a several-hundred-million-dollar shortfall that needs to be filled in somehow.”

The Farley renovation would follow the current work, which has a $267.7 million price tag and is scheduled to be completed by 2016 and includes asbestos removal, ventilation improvement, extension of the Long Island Rail Road concourse and building of new entrances from the Farley building into Penn Station.

Planners anticipate that the changes will ultimately improve commutes for hundreds of thousands by clearing platforms faster, increasing efficiency and the potential number of trains, allowing an additional 1,000 riders to pass through each day. “It’s just going to make a better pedestrian environment for the tens of thousands of people coming out of Penn Station every hour,” says Veronica Vanterpool, associate director of the Tri-State Transportation Campaign, an advocacy group dedicated to reducing car dependency. “Right now people who are coming into Penn Station are struggling to get out or to get in. The infrastructure is definitely under strain.”

Getting on Track

Perhaps the furthest-reaching implication could be improvements for Amtrak, which has a 30-year plan to introduce high-speed rail along the corridor, connecting New York to Washington in as little as two hours.

Nearly 8.4 million Amtrak riders passed through Penn Station in the most recent fiscal year, according to the railroad—and ridership along its Northeast Corridor is expected to grow at least 60 percent over the next two decades, Amtrak says.

Amtrak’s improvements over the past decade have included the addition of the Acela Express, which travels between Washington, New York and Boston at speeds of 150 miles per hour and has helped propel a 37 percent increase in national ridership from 2000 to 2010. High-speed trains would travel at 220 mph.

“The current facility is operating at levels greater than at any point in its history, which can lead to passenger overcrowding when even small delays occur,” an Amtrak spokesman, Clifford Cole, said in an email. “Failure to build Moynihan and achieve some or all of [its] benefits will require Amtrak and its commuter operating partners to seek alternatives (of which no other feasible concept has yet emerged).”

Easing intercity travel both provides economic opportunity in New York City and along the route and is likely to lessen congestion at the area’s overextended airports by making travel by train for short distances more appealing than travel by air.

“Intercity passenger rail brings in tourists. It brings in businesses. It relieves congestion at the airports,” Gilchrist says. “The more people we can put on rail, especially for short hauls under 1,200 miles, the better, and they can come right into the middle of Manhattan with access to the subway.”

Gilchrist emphasizes that he is looking to the private sector, particularly Vornado Realty Trust and the Related Companies, to help fund the second stage of the Moynihan project. Those companies are on board to assist with financing Farley’s renovation in exchange for the right to build new office space, most likely on the corner of 33rd Street and Eighth Avenue, Michaelson says. For work to continue beyond the first phase, Gilchrist says, the project will need to find additional funding within the next two years.

Along with Moynihan Station, a number of so-called transit megaprojects are under way across the city. The MTA says it still needs more than $3 billion to complete the Second Avenue subway’s first piece and the connection of the Long Island Rail Road to Grand Central Terminal, ongoing projects the agency predicts will benefit nearly 400,000 commuters every day.

“The need to invest in mass transit infrastructure is vital,” says Kevin Ortiz, an MTA spokesman. “This is clearly an issue where investing in mass transit infrastructure is directly in line with economic growth and prosperity.”

At stake, experts say, is not just the potential to create jobs, increase efficiency, improve commutes, raise property values and protect the environment but also the risk that underfunding transit could allow it to atrophy, creating the kinds of dangerous and decrepit conditions seen during the financial crises of the 1970s and 1980s. And as the 2012 elections approach, officials and advocates agree that control of Congress and the White House will have a major impact on which direction transit funding heads.

“You want a president who will set the tone for the importance of investing in infrastructure, that it has a value,” says Gian-Claudia Sciara, of the University of California at Davis’ Institute of Transportation Studies. “A lot of the elected officials in Congress right now are very resistant to passing a more robustly funded [transportation] bill, and unless that changes, you won’t get a bill that I think is funded at the level that most people agree is needed right now.”

Fiscal Foresight

Amid growing agreement that the nation should reduce its reliance on fossil fuels, including foreign oil, and a rising awareness of the ill effects of congestion and sprawl, some in Congress have proposed altering the balance of spending on highways versus mass transit—as well as the practice of funding infrastructure, including mass transit, through the gasoline tax. Better ways of paying for infrastructure could be derived from technology, advocates say, like using GPS or social networking to track and charge for transportation usage. Many argue that the economic downturn makes it an ideal time to expand mass transit, particularly rail, with its potential to create jobs and the wide, discounted availability of construction services and materials.

Yet concern about rising deficits and strain on local budgets, as well as the stalemate in Congress, has also made it a time of curbed ambition. For example, the U.S. Department of Transportation in October approved New York State’s request to speed up construction of a new Tappan Zee Bridge, but without a specific plan to add rail transit, which other proposals had included.

The federal government has a long history of assisting with major infrastructure projects, from the building of national railroads and interstate highways to helping cities acquire and improve their crumbling mass transit systems in the 1960s. Today, Congress uses complex formulas—aimed at fairly compensating each state—to determine the distribution of the majority of federal transportation funds. New York City alone represented about 30 percent of the nation’s mass transit ridership in 2003, according to the Bureau of Transportation Statistics.

“The transportation bill to New York is what the agricultural bill is to Iowa,” says Democratic Rep. Jerrold Nadler, a member of the House Committee on Transportation and Infrastructure.

Vitally important, that is. At current levels, New York State receives about $1.5 billion a year, not including stimulus funds, according to Nadler’s office—about 17 percent of the money distributed directly to the 50 states. The last six-year federal transportation reauthorization bill, passed by Congress in 2005, provided about $286 billion to the states for highways and mass transit. That bill, which covered 2004 to 2009, expired in September 2009, and Congress, yet to approve a new bill, has been operating under extensions.

A 2009 Democratic proposal in the House of Representatives would have raised the federal transportation total to $450 billion, plus an additional $50 billion for high-speed rail, but that bill didn’t pass, and the House’s leadership changed. The current Republican head of the transportation committee, Rep. John Mica of Florida, proposed a $230 billion bill in July, a 20 percent decrease from current levels and less than half of the $566 billion Obama had requested.

In an interview, Mica, who says he supports highspeed rail along the Northeast Corridor as well as several of New York City’s mass-transit projects, including Moynihan and the Second Avenue subway, says he favors increasing funding for transit projects, particularly high-speed rail, but through wider use of loan programs and public-private partnerships.

Because of the split leadership in Congress and the White House, no quick consensus is likely, making the upcoming elections even more important to the future of transit funding—and the future of New York City projects, which remain dependent on these funds. “If we don’t properly fund these things, it would limit economic activity, limit economic growth. Fewer people would be working here. Fewer people would live here. All of this is at stake,” says Nadler. “God forbid the president doesn’t get re-elected and you elect a Republican who is committed to austerity, isn’t committed to funding. The economy will crash.”

But Mica says he believes a Republican Congress or administration would speed transportation initiatives along faster than Obama and the Democrats, who he says have kept thousands of worthy projects mired in red tape.

“I think Republicans would be very innovative … bringing in the private sector to help operate and finance. I think it could move a lot of transportation forward faster,” Mica says.

Can Rail Fail?

Not everyone supports funding for high-speed rail. Critics call it a costly, far-fetched goal and say the government has already dispensed billions in funding with little, so far, to show for it. Florida Gov. Rick Scott this year turned down $2.4 billion in federal funds for high-speed rail in his state, citing the potential for cost overruns that would be borne by taxpayers as well as the cost of operating the system. In California, cost estimates for the proposed bullet train linking Los Angeles and San Francisco have already doubled since the project was approved by referendum in 2008, though the California High Speed Rail Authority predicted two years ago that it should generate a surplus of more than $2 billion by 2023.

Some, including Mica, fault Amtrak for dragging its feet on high-speed rail, proposing a 30-year plan when he believes speeds could be increased on the Northeast Corridor in a third of that time. Opponents also say the government-subsidized railroad, which in the past has enacted service cuts for lack of funds, should grapple with much needed maintenance of its aging infrastructure before attempting to implement anything so ambitious.

In any case, experts say, the prolonged funding uncertainty hurts major projects, whether they are already under way or still in the planning stages. “It just makes it very, very hard for transit operators, local governments, all these entities to really plan for the future. … These improvements exist in a very complex urban ecosystem, and you can’t just decide one day that you’re going to do something,” says Sciara.

Because of the daunting price tags of these projects, many, including Moynihan Station and the Second Avenue subway, are planned in separately funded phases so work can begin before all the money is acquired. But this creates a risk that projects won’t be finished, Sciara says, and many don’t achieve their most important benefits until completion.

The Second Avenue subway, a project that has been discussed since the city began removing elevated lines in the 1940s, is currently in the first of four phases: construction from 96th to 63rd Street. That first part, anticipated to be complete in December 2016, will cost an estimated $4.54 billion, $1.374 billion—30 percent—of which comes from the federal government, the MTA says. No timeline or budget has been set for the remaining three phases, which would eventually extend the line as far north as 125th Street and as far south as Hanover Square, in the financial district.

According to the MTA, when the 63rd Street–to–96th Street stretch is completed, it will serve 213,000 riders daily, decrease crowding on the Lexington Avenue line, which itself carries more passengers than the entire mass-transit system in Chicago, and reduce travel time by 10 minutes or more for those who live on the far East Side.

Another major MTA undertaking, known as East Side Access, will extend the Long Island Rail Road from Penn Station into Grand Central—the first expansion of the nation’s busiest commuter rail line in over a century, expected to benefit about 160,000 riders each day. The project will cost $7.33 billion, $2.7 billion—37 percent—of which is federally funded, and should be complete by September 2016.

East Side Access and the initial phase of the Second Avenue subway are both largely funded—yet the MTA says it still has a combined $3.46 billion gap for both projects. In July the authority said it would aim to close its capital budget gaps through a combination of cost savings, a federal loan, MTA revenue bonds and partnerships with the city, state and Port Authority. If the money for future phases of the Second Avenue subway cannot be found, the line will not be extended further south from 63rd Street or north from 96th Street, postponing relief for hundreds of thousands of potential passengers who live along the proposed route and failing to relieve overcrowding on the Lexington Avenue line. Another ongoing project, the extension of the No. 7 line from its current end at Times Square to 34th Street and Eleventh Avenue, is scheduled to be completed in December 2013, though Mayor Bloomberg recently endorsed the idea of extending the No. 7 to Secaucus, N.J. New Jersey Gov. Chris Christie, who in 2010 killed plans for an $8.7 billion commuter rail tunnel because of concern about cost overruns, has said he would support this extension. Advocates say plans like these, along with Moynihan Station reconstruction, have the potential to revitalize vast swaths of the city, increase efficiency, draw businesses and workers, and entice fewer commuters to drive, thus reducing pollution and congestion.

“It’s essential to make this a city that is mobile, a city that is viable and a city that is accessible. Otherwise our growth is going to be stagnant,” says Vanterpool. “There are also environmental considerations to take into account, in regard to the growing unease on foreign policy and importing oil. … Transportation overall is the third largest contributor of greenhouse gases, and buses and subways help minimize and reduce that impact.”

High Stakes

Yet if federal funding is significantly cut, it is unlikely that the city or state could make up for the gaps, and needed projects may well be postponed or shelved. Attempts to find alternate ways to pay for transit improvements have so far faltered, as with Bloomberg’s plan for congestion pricing, which would have charged those driving into the southern half of Manhattan and used the revenue to pay for major infrastructure work. And if improvements cannot go forward, experts say, not only would New York fail to see the environmental and economic benefits they would offer, but it would also face the deterioration and overuse of the existing system. Traffic would increase; commuters would face ever longer journeys; businesses would fail or leave.

Then there is job creation. The American Public Transportation Association estimates that for every $1 billion invested in transportation capital, 24,000 jobs are generated, and every $1 billion spent on transit operations creates 41,000 jobs. The MTA estimates that its 2000–2014 capital plan will create 350,000 jobs, with an overall economic impact of $44 billion in the state, and according to the New York Building Congress, the MTA is responsible for a full quarter of the city’s construction industry.

But although job creation figures are often quickly cited when new projects are announced, some experts believe those jobs are merely a bonus to more important benefits: the growth and sustainability of the city.

“By waiting, the costs increase, but also you’re not realizing the benefits of those projects sooner, so you’re delaying and pushing into the future all of the benefits you want to see, all the financial ripple effects, economic ripple effects, improvements over time,” Sciara says. “People’s ability to travel more reliably, more quickly, for businesses and producers to ship goods more efficiently—it’s really these longer-term gains that I think are at stake.”