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As Cost of Train Link Passes $11 Billion, MTA’s Credibility Shrinks

NEW YORK — New York City’s most expensive transit project just keeps getting more expensive. And it has nothing to do with fixing the failing subway.

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By
EMMA G. FITZSIMMONS
, New York Times

NEW YORK — New York City’s most expensive transit project just keeps getting more expensive. And it has nothing to do with fixing the failing subway.

A new train station under Grand Central Terminal and a tunnel connecting it to the Long Island Rail Road will now cost more than $11 billion — about $1 billion more than a 2014 estimate, according to the Metropolitan Transportation Authority. The project is unlikely to open before December 2022.

The compounding cost overruns and construction delays on a project that began more than a decade ago have raised doubts among city leaders over whether transit officials can tackle an ambitious overhaul to rescue the subway, which serves many times more riders than the new train station will.

The rail project, known as East Side Access, will bring the Long Island Rail Road to the East Side of Manhattan — the commuter railroad currently uses Pennsylvania Station on the West Side. An investigation last year by The New York Times found that the costs for the project were likely to surpass $12 billion, or nearly $3.5 billion for each new mile of track, seven times the average cost in other cities across the world.

On Wednesday, Mayor Bill de Blasio and Corey Johnson, the City Council speaker, sent a letter to the authority’s chairman, Joseph Lhota, questioning whether the agency could successfully implement its emergency plan to address the subway system’s most pressing problems, “given recent public reports about prolonged delays and billions of dollars in cost overruns on MTA projects.”

“City taxpayers deserve to know that they are getting a good return on their investment,” the letter said. “The public is skeptical when it comes to work performed by the MTA.”

With the city now paying for about half of the roughly $800 million subway plan, de Blasio and Johnson pressed for several accountability measures to make sure the authority was making progress to improve the subway, which has become a near-daily source of aggravation for riders.

After an MTA board meeting Wednesday, Lhota said that the letter was not necessary and that he would be happy to share updates on the subway plan with the city.

“It’s really, really important to understand that we are working diligently day in and day out,” Lhota told reporters. “If the city wants to know what we’re doing, we’ll show it to them.”

Lhota said the benefits of East Side Access, including having another rail link between Long Island and Manhattan, far outweighed the costs. As for de Blasio’s claim in a television interview Monday that the agency hid the true costs of the project until after the recent state budget talks, Lhota called the idea “hogwash” and said the MTA board was regularly briefed on the project.

The new train station, which will be about 15 stories below Grand Central Terminal, could eventually serve as many as 200,000 commuters, according to the authority. It would let Long Island riders travel directly to the East Side of Manhattan and alleviate overcrowding at Penn Station, which is currently used by three railroads — the Long Island Rail Road, New Jersey Transit and Amtrak.

Kathryn Wylde, the president of the Partnership for New York City, an influential business group, said the new station would spur development in Manhattan and Long Island and shorten the commutes for many riders.

“Reform of MTA procurement and contracting procedures is certainly necessary to reduce construction costs of major projects — and the MTA has already demonstrated a commitment to begin this process,” Wylde said in a statement. “But it is clear that the value generated by investments in transit are enormous and need to be factored into any cost-benefit analysis.”

But East Side Access has widely come to be viewed as a boondoggle and a symbol of the authority’s ineptitude. Early estimates for East Side Access predicted the tunnel would cost $2.2 billion and be finished by 2009. In a presentation to the board, Janno Lieber, the authority’s chief development officer, listed reasons for the rising price tag, including changes to contracts and insurance costs. One budget category alone known as “soft costs,” which includes engineering, management and real estate costs, has risen to nearly $2.2 billion, Lieber said.

“I can’t tell you that there isn’t a lot of disappointment coming out of this review in terms of the budget impact,” Lieber told the board.

Costs have also ballooned on other MTA projects, especially compared to international standards — the recently completed Second Avenue subway on Manhattan’s Upper East Side cost $2.5 billion per mile, and the 2015 extension of the No. 7 line to Hudson Yards cost $1.5 billion per mile. Elsewhere in the world, a mile of subway track typically costs $500 million or less. Scott Rechler, a board member appointed by Gov. Andrew Cuomo, who controls the authority, said he had recently toured the East Side Access construction site and did not think the current price tag was final because so much work was left to be done.

“Frankly, I wouldn’t be surprised,” Rechler said, “if we see more cost overruns.”

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