(The following story by Brian Kates appeared on the Daily News website on February 25.)
NEW YORK — The optimistic vision of a glittering new mini-city on Manhattan’s far West Side is in danger of dying from uncertain funding, risky financing and lack of coordination, a Daily News investigation reveals.
The dream – some critics call it a pipe dream – envisions a neighborhood built over the Metropolitan Transportation Authority’s West Side railyards, a relocated Madison Square Garden, an elegant new rail hub to replace dingy Penn Station and a commuter rail tunnel under the Hudson River.
All of these projects are in various stages of development, but despite billions spent by the city, state and developers on studies, land acquisition and architects, no one has figured out who will pay for all of it, or how.
Let’s begin with Hudson Yards.
That’s the city’s name for a planned new district west of 10thAve., complete with office and residential towers, parks andits own subway stop on an expanded No. 7 line.
The 33-acre district, much of it over the railyards, was rezoned in 2005, and the five developers picked by the city are to submit revised proposals in a second round of bids tomorrow.
Expanding the No. 7 line is considered crucial to the success of the new neighborhood, but the project already has been scaled back to cut costs, a move that throws another wrench into the grand plan.
In his State of the City address last month, Mayor Bloomberg said the No. 7 extension was so crucial that the city “refused to wait for the MTA” and in December “broke ground on the first new mile of subway track the city has funded since the 1950s.”
That’s the rhetoric. The reality is less optimistic.
To begin with, the city puts the cost of the expansion at a deceptively low $2.1 billion – a figure it set in 2003 and hasn’t budged from despite skyrocketing construction costs. The MTA, which considers the proposed Second Ave. subway line a greater priority, has refused to pick up the tab.
A $1.1 billion tunneling contract has been awarded, but to save an estimated $450 million, the city abandoned plans to put a station at 41st St. and 10th Ave.
That means the line will run from Times Square to 34th St. and 11th Ave. without a stop – adecision that “puts at risk several million square feet of potential commercial and residential development” in the Hudson Yards, Sen. Chuck Schumer (D-N.Y.) said. “Development follows mass transit.”
If builders lose interest, New Yorkers could be saddled with billions in debt. The city is funding the project from the sale of $2 billion in bonds. Interest from the bonds is payable from city appropriations; the principal will be met by revenue from payments in lieu of taxes by developers.