A funding agreement was reached for the multibillion-dollar redevelopment of New York’s aging Penn Station, the country’s busiest rail hub.
Gov. Kathy Hochul and Mayor Eric Adams announced details of the deal Monday.
The plan would create new commercial and residential buildings around the station, with those building’s developers getting to make payments in lieu of taxes for a period of 40 to 45 years. The amount collected in excess of existing property taxes would be applied to the project.
That money would contribute more than $1 billion to pay for improvements to streets, sidewalks and other public spaces, as well as 50% of the improvements to transit infrastructure including underground concourses and subway entrances.
“This agreement brings us one step closer to a beautiful, modern station worthy of New York with vibrant open space, lively streetscapes, and better, more seamless connections to local transit,” Hochul said in a statement.
The reconstruction of the station and the first phase of the improvements to public spaces is expected to cost roughly $8 billion. Hochul’s vision is a scaled-down version of earlier plans announced by her predecessor, fellow Democrat Andrew Cuomo.
A recent study commissioned by Reinvent Albany, a state government watchdog group, estimated that the payments in lieu of taxes would amount to about $4 billion, a number that assumed a southern expansion of the station to accommodate more tracks when a new Hudson River tunnel is built several years from now. That expansion, which is in initial discussions, is projected to cost an additional $13 billion.
The plan has provoked criticism from neighborhood groups who contend it will destroy a vibrant area and displace residents and businesses.
Samuel Turvey, chairperson of RethinkNYC, a transportation and land use advocacy group, said the plan is misguided because it fails to turn Penn Station into a through-running facility where trains would pass through to other areas of the city, rather than turning around and returning to their origin or sitting in rail yards.
Turvey called the plan “a very ugly replacement theory where local residents, small businesses and historic structures are being cast to the winds with the help of the state and city.”
City and state officials have come to terms on paying for the renovation and expansion of Penn Station — some of it, anyway.
Gov. Kathy Hochul and Mayor Eric Adams announced on Monday an agreement over how the city will collect property taxes from the 18 million square feet of construction planned on sites surrounding the station.
As expected, the city will continue to collect the property taxes it receives now on the development sites, increasing by 3 percent each year. It will also get payments in lieu of taxes, or PILOTs, from the developers of each of the 10 future towers; the mechanism allows money to be directed to a specific purpose, in this case Penn Station work, rather than go into the general fund.
The property owners will not pay traditional property taxes on the increased value of the land for an extended period of time. The city will not collect the full property taxes on these sites until the agreed-upon contributions to the project are met or after 80 years, at the latest.
The PILOTs will cover 12.5 percent of the estimated $7 billion cost of renovating Penn, and of the possible expansion of the station, reportedly a $12 billion project. The payments will fully offset the cost of public realm improvements, such as street and sidewalk work, and will take care of 50 percent of the expense of transit work, including underground concourses and new subway entrances.
Adams called the deal a “win-win” for New Yorkers.
The announcement does not include many details on the expected value of the PILOTs, nor how they will be distributed between the renovation and expansion. It also does not specify how much the state expects to make from the sale of development rights in the neighborhood.
State officials released a copy of the financial framework late Monday afternoon. Opponents have complained that the project’s finances lack transparency.
Elizabeth Marcello, a research analyst with Reinvent Albany, a watchdog group that has been critical of the state’s plans for Penn, said the announcement further blurs the lines between the expansion and renovation of the station.
“There’s still a lot of glaring questions we don’t have answers to,” she said.
17 comments:
All those billions and at the end of the day there'll still only be 3 functioning urinals and every stall will be perpetually occupied by homeless dudes rinsing their skivvies in the bowls... Prove me wrong!
Build baby build !
Build Back Better Again ?
TWO LYING DOGFACE PONY SOLDIERS !
The truth hurts don't it democraps .vote Republican y'all .
Can we blame trump ?
Meanwhile in the rest of the city the Sheeple be damned !
Even our city streets/structures are decaying under the demorats.
https://nypost.com/2022/07/19/giant-sinkhole-swallows-van-in-the-bronx/
And our property taxes will keep going up.
Here in Northeast Queens, my taxes went up $1,000 this year.
For what???
Nada.
Swagger!
How does this even work? They're paying for the station - but instead of paying property taxes? So the developers would be paying the same amount of money either way? How is that a win?
And I thought pointing out 'replacement theory' was a racist dog-whistle. Turvey is right, though - this is the rich replacing the poor, and on top of it, the rich are getting handouts from the City, while the poor are getting nothing! The area around Penn Station is a logical place to build skyscrapers - but it shouldn't come at the expense of the mom & pop shopkeepers who've been laboring away there though good times and bad.
If TrumpTurd managed to get this off the ground you’d all be fawning over it. All he managed was an overpriced Lego wall to nowhere. Of course Mexico will pay for that…,
“The PILOTs will cover 12.5 percent of the estimated $7 billion cost of renovating Penn, and of the possible expansion of the station, reportedly a $12 billion project.”
I thought the Farley/Moynihan project addressed the Penn situation.
Will an expansion even be needed after the east side access for the LIRR opens later this year?
This is beginning to look like another money laundering boondoggle (as the old folks call it).
Perhaps it is another Amazon-LIC scam. After the subsidies were denied they simply went on and expanded anyway.
If these “investors” want to build more offices and condos, let them use their own money and pay taxes just like me.
Stop coddling the R.E. industry they screw us enough already.
Rob in Manhattan
80% of the taxes are paid by the top 20% of taxpayers and the bottom 50% don't pay taxes, they get paid via credits, etc...
Rob in Manhattan I agree !
Yeah, all those skylights are leaky in storms. When a client complained Frank Lloyd Wright's skylights leaked, he was told to move his chair.
ProudAmerican76 said...
NYC as we remember it will never be the same. The pandemic forced companies to set up the ability for their employees to work remotely. Once that occurred and was shown to work it was over for all major office buildings around the country. They are now a luxury and not a necessity.
Along with this shift will be ancillary changes. Among those will be a reset of funding due to a changing tax base. That means education, transportation, restaurants, etc. simply aren't needed in the same numbers as before the change. Schools at 80% and half-full trains can't be funded at previous levels as we simply won't have the tax base here.
Unions will scream and politicians will pander but the elephant in the room is that they will also lose power and they don't like that. Ironically, they played a part in their own demise by taking a power trip during the worst of the pandemic and closing schools and businesses while in other states they remained open. People trained their peepers on those states and realized they didn't need to be here. Enjoy the decline, NYC. You certainly earned your fate.
Swagger is what he has always been: overestimated & outmaneuvered.
@“ ProudAmerican76”
Go back to whatever shithole country you came from.
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