Does a New Port Authority Bus Terminal Really Cost $11 Billion?

It hit this morning’s headlines with a thud: Replacing the aged, overburdened Port Authority Bus Terminal will cost up to a staggering $11 billion, according to a plan to be presented to the Port Authority’s board on Thursday. But is that figure based in reality?

Advocates are skeptical and wary that the cost is being inflated in a bid to stop the project before it can get off the ground.

Photo: Port Authority
Both Chris Christie and Governor Cuomo have a history of inflating transit cost projections when they don’t want to build a project. Photo: Port Authority

The cost projection might seem par for the course to New Yorkers jaded by the region’s out-of-control construction costs. But let’s put things in perspective: The reported size of the bus terminal replacement is about the same as the combined cost of three of the Port Authority’s other major capital projects: the $1.5 billion PATH extension to Newark Airport, the $3.6 billion rehabilitation of LaGuardia Airport, and Santiago Calatrava’s $3.9 billion WTC transit hub.

The big difference between those projects and the new bus terminal? They’re actually in the Port Authority’s capital plan. The bus terminal revamp, however, doesn’t appear to have political support from either New York Governor Andrew Cuomo or New Jersey’s Chris Christie, the two men in charge of the bi-state agency. (Cuomo, for example, didn’t mention it in his infrastructure speech earlier this year.)

That might help explain how the Port Authority reached such outlandish cost projections, says Tri-State Transportation Campaign Executive Director Veronica Vanterpool.

“There’s a tendency to over-inflate transit costs just to kill them,” she said. Christie, of course, famously overstated the cost of the ARC Tunnel in his quest to derail the project, and Cuomo inflated the cost of bus lanes on the Tappan Zee Bridge in his rush to build a new crossing.

The Port Authority refused to comment on the cost estimates, only saying that they would be released to the board on Thursday. “We look forward to updating the board on this critical project,” said spokesperson Chris Valens, “and continuing to engage the public and other stakeholders on ways to improve the bus passenger experience in the region and meet the demands of the future.”

Until now, the Port Authority’s numbers for the bus terminal had been much more modest.

Since last year, the authority had been planning $263 million in upgrades to the existing facility, paying for things like new air conditioning, electrical work, and a relocated control center. Initially, the authority had just $173 million for the bus terminal in its capital plan, but public pressure pushed the authority to trim from other projects and allocate an additional $90 million to the bus terminal upgrades in the capital plan.

The Port Authority is also interested in building a bus garage to cut down on traffic from empty buses returning to New Jersey during the day before coming back to New York to pick up evening commuters. That project, mothballed during the 2009 budget crunch and last estimated at $400 million, remains on shaky ground after it failed to win a $230 million federal grant last fall.

Ultimately, the bus terminal needs more than new air conditioning and a layover garage. At peak hours, it handles as many passengers as Grand Central Terminal and carries as much cross-Hudson traffic as PATH and NJ Transit rail combined. It’s bursting at the seams, and projected passenger growth — a 35 to 51 percent increase by 2040 — cannot be accommodated in the existing facility.

Before last July’s board meeting, commissioners coalesced around eventually tearing the current terminal down and building a new one from scratch. At the time, Port Authority officials said the cost of a new terminal would come in at $1 billion or more.

Port Authority commissioner Kenneth Lipper, an outspoken New York appointee who has championed bus terminal improvements, urged his colleagues to put the project into the capital plan. “Let’s make this a tangible thing. Let’s find the money for it. And let’s just get on and do it,” he said at a July meeting of the capital planning committee. “Put the bus terminal into the plan… [so] this will become a real project.”

Other commissioners wanted to hold off on committing to the new bus terminal until the results of a bus master plan, underway since 2012, were available. The board eventually voted for a resolution that delayed action until the plan was released and also asked the master plan to prioritize a complete replacement of the bus terminal, possibly moving it to a new location.

The study’s preliminary results are due this week, and that’s where the shocking $11 billion price tag appears to come from.

“I think the public has to be very diligent in looking at the numbers,” Vanterpool said. “I’m just raising flags, like lots of people are, that they’re affixing this enormous price tag to it, and then everyone’s going to say that we can’t move forward with it. And that’s a concern.”

It looks like the governors’ hold over the Port Authority is unlikely to loosen anytime soon. On Monday, the New Jersey Senate failed to override Christie’s veto of a bill to reform the authority. An effort to override Cuomo’s veto also appears to have stalled in Albany.

  • com63

    They probably assumed that they would need to buy an entire city block (or two) of prime Manhattan real estate to build a new terminal. I think you could get close to $11B with large real estate transactions.

  • ahwr

    If land acquisition is a large part of the cost that’s alright, because they can get a lot of it back by incorporating a skyscraper into the new terminal. Not talking about that part makes the project look more expensive than it is.

  • Guest

    But you could conveniently forget that if you wanted to inflate the cost.

  • Larry Littlefield

    “It’s bursting at the seams, and projected passenger growth — a 35 to 51 percent increase by 2040 — cannot be accommodated in the existing facility.”

    It the LIRR wasn’t controlled by the featherbedding disability fraudsters and their political pals in Albany, I’d say the solution would be for those additional Manhattan workers to move to Long Island instead of New Jersey.

    Basically all of this can be chalked up to the culture of corruption on Long Island, and the fact that those not in on it are fleeing from it.

  • BBnet3000

    Given that it cost them >$3.5 billion to rebuild the PATH station after it was already rebuilt and serving all passengers, $10 billion for a huge new garage and new bus terminal, all connected to the Lincoln Tunnel ramps and whatnot (a very complex project) sounds like a bargain by New York/Port Authority standards.

  • Bolwerk

    Beyond some accommodations for long-distance buses, the terminal is probably pointless. Might be time to take a serious step back and study where people are going once they get to Manhattan and find better ways to get them there. To a large extent, the terminal is just an intermodal transfer point.

    Why can’t NJT buses continue across town to drop off and pick up passengers? Is that really a technical impossibility, or do NJT and NYCTA just not want to work together? Certainly a non-trivial number of NJT passengers want to get to other parts of the city.

  • ahwr

    What would the facility lose if it stopped subsidizing njtransit buses?

    http://www.capitalnewyork.com/article/city-hall/2014/07/8549619/wheres-big-fix-port-authority-terminal

    Every time a Greyhound bus leaves the Port Authority, it is charged $45.29. Every time a New Jersey Transit bus leaves the terminal, it’s charged $2.48.

  • Bolwerk

    Somebody would lose protection.

  • Rob Durchola

    It makes far more sense to use the existing New York City (NYCTA) transit network to disperse commuters using the Port Authority Bus Terminal than to send thousands of additional buses (700 in peak hour alone) across 42nd Street or on any other route.
    Remember that the commuters from each bus are going to multiple destinations in Manhattan and one routing would neither serve these commuters (including lack of shelter on the return trip while waiting for the bus) nr the New York street system. The added travel time for each bus would also cost NJ Transit and the other companies using the terminal hundreds of thousands of dollars or more on an annual basis.

  • Bolwerk

    Well, I said I’d like to see it studied. Distributing across Manhattan means direct access to every Manhattan trunk line, so they aren’t all crowding on at Times Square.

    That said, there is no reason they all have to do any particular thing. They don’t all have to cross via the same street. They don’t all have to cross town. Some can loop on the west side, some can cross town, some can even use a lower scale terminal. Maybe it’s necessary that each have a stop near PABT42.

    The point is there are probably much cheaper/better ways to handle the traffic, especially if you are willing to remove a little private auto traffic or can find ways to offer buses from NJ private lanes on some cross town streets.

  • BSPABNY

    I agree, these cost estimates make a LOT of other options make sense. Maybe more than one solution? Don’t try to replace the PABT in kind, but instead look at what package of investments would serve the same demand and hopefully add capacity for anticipated growth.

    I started to jot down some ideas for a distributed set of commuter and intercity bus terminals in NJ (Secaucus+7 train extension, Vince Lombardi+SAS extension, Newark/Harrison/Jersey City+PATH train improvements), but moving the transfer point for that many people introduces a two-seat ride to Manhattan, further burdens existing connections from those transfer points to Manhattan destinations, and absolutely requires new connections like the 7 train extension. Not sure we’d come out ahead as a region.

  • Bolwerk

    You might be right, but a two-seat ride to Manhattan is probably indistinguishable from a two-seat ride with a transfer in Manhattan. Many of those bus riders are probably doing a lot more than that.

    The 7 is kind promising in that regard. Maybe it gets a lot of people who might want to get to the east side off buses, but maybe the E route is closer to where East Side-bound riders want to be.

  • BSPABNY

    “They” are inflating the cost of PABT to make Gateway look that much more attractive. And, honestly, the complete Gateway package seems, on its face, more attractive than the PABT replacement plus other necessary, related improvements that need to be considered part of the PABT replacement package (Helix, XBL expansion, access route improvements). I’m considering life cycle costs and benefits. And let’s not mention value capture, that Socialist conspiracy that prevents landowners/rentiers from reaping windfall profits from large public investments like this.

    For example, in a scenario where PABT replacement ends up less attractive overall than Gateway, keep PABT as-is . People go to that hell-hole in droves for many reasons, not least of which is the lower cost of taking the bus vs. the train (although there are many subsidies involved that may or may not make sense–that’s a whole other bowl of spaghetti).

    Gateway will have something like double the up-front capital costs, but over time will the entire package have lower lifecycle costs on a per-passenger basis, will it create more jobs and raise per capita income, and will it have greater environmental benefits vs. PABT replacement? We need to have this discussion. These projects shouldn’t be discussed in isolation.

    I’m also really puzzled by where “projected passenger growth — a 35 to 51 percent increase by 2040” comes from. More made up numbers. Under what circumstances do we even want this to happen? How are the XBL, Helix, Lincoln Tunnel, approach routes, etc., going to accommodate that many buses without massive investments? Do we really want that many buses coming into Manhattan each day, when other alternatives are on the table, including alternative transfer points in NJ?

  • BSPABNY

    In a very short period of time, the cost of compiling and analyzing origin-destination data by individual bus trip, train run, boarding and/or alighting location, etc, etc, has fallen tremendously. There are all kinds of new data sources and analysis tools available. The questions we’re asking can be answered, and should be.

  • BSPABNY

    Not to mention that a new terminal would be more cost-effective to operate on a per-passenger basis (or maybe even in absolute terms). And the terminal itself could generate higher lease revenues per square foot from higher-end merchants. And NJ Transit and other operators would see their operating costs plummet as they could store more buses in Manhattan during the day. And so on. But hey, who cares about all that, someone else (or some other generation) will pay the operating costs.

  • Larry Littlefield

    This issue was raised 20 years ago.
    But I don’t think anyone here could complain about Port Authority tolls subsidizing Cross Hudson transit.
    The real crime was back then, when money was diverted from NY airports to keep fares and tolls lower for NJ than MTA riders and tollpayers were paying.

  • Bobberooni

    Some realities about this whole stuff:

    1. This is not just a “public transit” project, it is absolutely essential to the economy and real estate values in North Jersey. Why NJ’s leadership (or lack thereof) doesn’t take that more seriously is beyond me. It really won’t matter so much to NY.

    3. Most NJ residents live a block from a bus stop that goes to PABT. Only a small fraction of NJ residents live anywhere near a train station. Gateway and PABT are unfortunately no interchageable. NJ probably needs both. Years of underfunding of infrastructure have led NJ to a sense of complacncy.

    4. If Gateway is built and NJTransit begins to bring more trains into NYC, it will have to majorly upgrade the rail system throughout the state. Which will cost many billions more, given the current decrepit state of the NJ rail system. NJTransit is a far cry from Metro-North.

    5. Expansion of PABT will require two XBL lanes. Talk about making two XBL lanes at this point are pointless because PABT has capacity for only one.

    6. Building a bus-to-train transfer station in Secaucus is not a bad idea. But in addition to eliminating the “one seat” ride to Manhattan… remember that PABT TODAY handles more traffic that GCT. Imagine the logistics involved if everyone at GCT were to get off a Metro-North train and go right onto a NYC subway — that’s what would be happening at your Secaucus bus station. This would have to be a far bigger operation than the WTC PATH station, which is already teeming with people. It would not be cheap. Stations on the NY side of that subway line would have to be majorly upgraded too. And once you’ve built all those new stations, you STILL must build tunnel capacity to get those people into NYC. It’s not clear that a tunnel full of trains is any more/less efficient (people per hour) than a tunnel full of buses. Converting a car lane of the Lincoln Tunnel to XBL is certainly the cheapest way to add trans-Hudson transit capacity. For all these reasons, a new larger PABT really might be the most cost effective plan.

    7. Estimates of 40% more passengers by 2040 are not at all unreasonable. PABT ridership has been increasing significantly in the recent decade, to the point that riders now endure hour-long evening delays just getting on a bus. It is intolerable, and is probably now a significant constraint to further trans-Hudson commuting. But NJ is relatively undeveloped compared to the rest of the region, and it’s cheaper to add more housing there than in the more developed parts of the region (i.e. almost anywhere else); hence, the idea that more people would live in NJ if they could get to their job.

  • JamesR

    Re #7: NJ is actually the most densely populated state in the US. There’s way more opportunity in lower Westchester than there is in Hudson and Bergen Counties in NJ. In all reality, there probably should not be any single family homes within 20 miles of Columbus Circle. Transit and housing density need to go hand in hand to be successful.

  • JamesR

    “Why can’t NJT buses continue across town to drop off and pick up passengers?”

    Oh hell no. Have you ever ridden a cross-town MTA bus at rush hour? No way can the east-west corridors handle additional bus traffic. They are tapped out.

  • Fakey McFakename

    Actually, I think a PABT replacement should be a central hub by a PATH station on the Jersey side connected to improved PATH service. Would massively reduce land acquisition costs and avoid tunnel congestion altogether. better to have low headways and easy connections than spending loads of time and money taking people direct.

  • Andres Dee

    Why wasn’t a new bus terminal baked into the Hudson Yards deal? At the very least, it could serve the intercity market. 33rd & 34th at 11th are already a de-facto terminal and value-seeking customers are clearly willing to trek out there.

  • Michael Klatsky

    Really? Can you find out that someone gets on a bus in Englewood rides to PABT, then transfers to the subway to go to Lower Manhattan?

    How can we find out if they transferred to the subway, NYCT Bus or walked?

  • Bolwerk

    That can probably be fixed some dedicated lanes.

  • Rob Durchola

    It has been studied numerous times by NJ Transit, most recently at the request of former Board Chairman James Simpson (as indicated in NJ Transit Board meetings posted on line). I would think if the studies indicated it were feasible to do so, it would have been implemented, at least on a trial basis with a few routes.

  • BK Train Fan

    I’m guessing you could actually create an app that would be designed to capture this information through location services on smart phones.

  • steve

    You mean the dedicated lanes full of empty parked police cars?

  • steve

    There’s 40 NJ transit busses for each Greyhound.. if not more.

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