Thursday, October 26, 2006
More Woes for Port Authority
As the saying goes, when it rains it pours. As the end of the year approaches, the Port Authority (PAT) is facing yet another budget shortfall. They have begun exploring ways to cut costs such as closing the Wabash Tunnel. However, outsourcing remains off the table, thanks to a labor deal brokered by Governor Rendell. Thus, they are left waiting for whatever funds the Governor can flex their way and hoping that his task force can convince the Legislature to dedicate more taxpayer funds to the transportation monopoly.
Still yet, their fiscal troubles have not stopped them from embarking on an aggressive capital construction binge that has seen the rehabbing of the Wabash Tunnel (now on the chopping block) and the South Hills parking garage (which is very underutilized). The next white elephant to be constructed is the North Shore Connector—a $435 million project.
Of course, the $435 million price tag for the Connector is just the beginning. It does not take into account cost overruns. It is not clear if it includes the costs it must pay to other authorities for the use of those authorities’ land. For the privilege of using space in parking lots owned by the Sports and Exhibition (SEA) and Stadium Authorities, PAT is being charged $2.1 million.
The SEA wants to be compensated for the lost revenues that will occur as machinery and materials being used to dig the tunnel are sitting on their parking spaces. The director of the SEA claims that PAT had agreed to the $2.1 million price in November 2003 as terms of a “cooperative agreement”.
PAT directors are not happy with this arrangement. They see the Connector as primarily benefiting the SEA and the development that the Connector will help spawn. Maybe the SEA is not convinced of the “benefits” of this project, and wants the money on a timely basis.
Either way this is just the beginning of the unexpected costs and overruns that are awaiting PAT as they embark on this boondoggle.
Still yet, their fiscal troubles have not stopped them from embarking on an aggressive capital construction binge that has seen the rehabbing of the Wabash Tunnel (now on the chopping block) and the South Hills parking garage (which is very underutilized). The next white elephant to be constructed is the North Shore Connector—a $435 million project.
Of course, the $435 million price tag for the Connector is just the beginning. It does not take into account cost overruns. It is not clear if it includes the costs it must pay to other authorities for the use of those authorities’ land. For the privilege of using space in parking lots owned by the Sports and Exhibition (SEA) and Stadium Authorities, PAT is being charged $2.1 million.
The SEA wants to be compensated for the lost revenues that will occur as machinery and materials being used to dig the tunnel are sitting on their parking spaces. The director of the SEA claims that PAT had agreed to the $2.1 million price in November 2003 as terms of a “cooperative agreement”.
PAT directors are not happy with this arrangement. They see the Connector as primarily benefiting the SEA and the development that the Connector will help spawn. Maybe the SEA is not convinced of the “benefits” of this project, and wants the money on a timely basis.
Either way this is just the beginning of the unexpected costs and overruns that are awaiting PAT as they embark on this boondoggle.
