Capital planning in New York involves the long-term strategy, budgeting, and project delivery processes used to build, maintain, and modernize the city and state’s public infrastructure. This page covers CBC’s work on MTA capital programs, land use and environmental review reform, project delivery and procurement, infrastructure maintenance, and debt management.
This page was created with AICBC Insights uses AI to group, analyze and present data and recommendations from CBC's publications. Always reference the cited sources to verify important details..
Focus capital investment exclusively on projects to repair and improve the system.
Increase the State contribution by $7 billion, primarily by shifting funds from lower impact programs, and increase the City contribution by $2 billion.
Modestly increase fares, tolls, and vehicle registration fees, dedicating them to support $6.8 billion in bonds.
Ensure labor provides the flexibility to implement $500 million in recurring operating savings to support the planned level of MTA borrowing.
Turn the tide on fare evasion.
Require the MTA to publish capital project schedules and costs, provide annual updates on project progress and asset conditions, and complete a study with an external partner to identify why MTA capital projects are so expensive.
Key Data
As of June 2025, the City's five-year capital program stood at $111 billion, and the Ten-Year Capital Strategy for fiscal years 2026 to 2035 allocated 50% of capital spending to State of Good Repair, 24% to Programmatic Replacement, and 26% to Program Expansion.
In March 2025, the MTA's proposed 2025-2029 Capital Plan included $68.4 billion of investments, but only identified $35 billion in funding, leaving a $33.4 billion gap that grew to $35.4 billion under the State Fiscal Year 2026 Executive Budget.
According to a December 2024 report, joint bidding on street construction projects reduced utility-related delays from 28 months to 7 months, avoiding 21 months of delay that would have added $4.3 million to the cost of each project.
In September 2024, the CBC reported that a record $27.6 billion of projects from prior capital plans would remain uncommitted by the end of 2024, driven by pandemic slowdowns and congestion pricing uncertainty.
In April 2024, New York City held $96.9 billion in outstanding debt against a constitutional debt limit of $127.5 billion, leaving 24% (or about $30 billion) of remaining borrowing power.
Extending joint bidding on public works contracts for one year would allow New York City to simultaneously bid capital projects and utility relocation work, accelerating project delivery and reducing construction costs. Without this extension, contractors would have to negotiate utility interference directly, leading to project delays and higher capital costs that are ultimately passed on to ratepayers.
Recommendations related to Capital Planning
Governor Hochul should sign S10194-A/A11454 and S10195-A/A11455 to extend authorization of joint bidding on public works contracts in lower Manhattan and in the rest of New York City for one year, respectively.
$11 billion is the amount the new Port Authority Bus Terminal is projected to cost, a quarter of PANYNJ's ten year capital plan and a keystone project for the region's travelers. It's still just a small piece of what the Port Authority -- and its new executive, Kathryn Garcia-- oversees.…
Sherif Soliman has more than 30 years of experience in government and currently serves as Budget Director of the New York City Mayor’s Office of Management and Budget. In this role, he oversees the city’s fiscal policy, including the development of the expense and capital budgets, the city’s bond and…
New York's State Environmental Quality Review Act (SEQRA), originally intended to ensure government accountability, has increasingly become a bureaucratic obstacle that delays and inflates the costs of essential housing and infrastructure projects. Reforming this process is necessary to allow the state to address its critical housing shortage and aging infrastructure needs at a more efficient pace.
Recommendations related to Capital Planning
Governor Hochul should exempt strategic priorities, like multifamily housing, childcare and resiliency projects, from SEQRA to accelerate their development.
New York should reform environmental review to rebalance public decision-making processes so the state can address its mounting needs at a pace befitting the scale of its challenges.
Key Data
23 months
— Median time to complete environmental review and pre-certification for projects using streamlined environmental assessments.
33 months
— Median time to complete environmental review and pre-certification for projects undergoing a full Environmental Impact Statement.
43
— Number of SEQRA challenges decided by State courts in 2024.
5
— Number of SEQRA challenges that prevailed in State courts in 2024.
$2.2 million
— Average home value in Sag Harbor, where a 79-unit affordable housing complex was blocked.
1,800
— Number of new affordable housing units permitted by the 2018 Inwood rezoning.
Blake G. Washington is the Budget Director for the State of New York, appointed by Governor Kathy Hochul. Mr. Washington is responsible for the development and management of the New York State budget and leads a team of public servants to administer the fiscal duties of the state, including economic…
New York City should prioritize careful capital planning and project delivery reform to manage fiscal challenges effectively. Focusing on state-of-good-repair investments and improved capital execution will help control capital costs, moderate debt service, and reduce long-term maintenance spending.
Recommendations related to Capital Planning
The City should engage in careful capital planning and project delivery reform.
Prioritizing state-of-good-repair investments and improving capital execution can help control capital costs, moderate debt service, and reduce maintenance spending over time.
The proposed legislation A2747A/S2536A would mandate prevailing wages for off-site custom fabrication of building components, significantly increasing costs and delivery times for public capital projects. By forcing these requirements on off-site factories, the bill would discourage the use of efficient modular construction methods that currently save time and money on infrastructure and public building initiatives.
Recommendations related to Capital Planning
The Governor should veto A2747A/S2536A to prevent the imposition of prevailing wage requirements on off-site custom fabrication.
The State should allow the City and State to continue to use off-site custom fabrication without prevailing wages when it would reduce the time or cost of a capital project.
Key Data
20 percent to 50 percent
— The range by which modular building can accelerate project delivery according to McKinsey estimates.
20 percent
— The amount by which modular building can reduce costs according to McKinsey estimates.
$1 million
— The cost per structure for prefabricated public restrooms recently opened by the New York City Department of Parks and Recreation.
$3.5 million
— The cost for a typical park bathroom built fully on-site, which is significantly higher than the prefabricated alternative.
3
— The number of pedestrian bridges installed by the New York City Department of Design and Construction using off-site construction over the FDR East River Drive.
5
— The number of prefabricated public restrooms recently opened by the New York City Department of Parks and Recreation.
Extending the authorization for joint bidding on public works contracts allows the City to simultaneously bid capital projects and utility relocation work, which accelerates project delivery and reduces construction costs. This process avoids the inefficiencies of private negotiations between contractors and utility companies, which often cause project delays and increase expenses for ratepayers.
Recommendations related to Capital Planning
The Governor should sign S8404/A8679 and S8405/A8678 to extend authorization of joint bidding on public works contracts in lower Manhattan and the rest of the city for one year.
New York City's $111 billion five-year capital program is the subject of a 2025 mayoral candidate questionnaire, which explores how candidates would prioritize capital investments. The document outlines various perspectives on the current allocation of funds across categories such as state of good repair, programmatic replacement, and program expansion.
Key Data
$111 billion
— The total value of the City's five-year capital program.
50%
— The current share of capital spending allocated to the State of Good Repair category.
26%
— The current share of capital spending allocated to Program Expansion.
24%
— The current share of capital spending allocated to Programmatic Replacement.
New York City's aging infrastructure requires smart, resilient capital investment to support future economic growth. The city must prioritize bringing assets to a state of good repair, overhauling capital spending management, and avoiding waste through standardized designs and efficient planning.
Recommendations related to Capital Planning
The next mayor should fix what’s broken by bringing assets to a state of good repair.
The next mayor should invest in essential climate resilience and a cost-effective energy transition that balances affordability, the environment, and the economy.
The next mayor should overhaul capital spending by better managing assets and projects, fixing procurement, and controlling costs.
The next mayor should avoid waste by choosing standardized over customized designs and avoiding new school construction when redistricting can solve the problem.
CBC's Andrew Rein was joined by NYC Director of City Planning Dan Garodnick and NYCEDC President & CEO Andrew Kimball for a wide-ranging discussion on job and population trends, housing affordability, and economic development in a time of uncertainty. Dan Garodnick is Director of the New York City Department of…
New York faces a funding gap of over $30 billion for the MTA capital investment plan, necessitating immediate action to prevent system deterioration and rising costs. To address this, the state should prioritize repair projects, increase government contributions, and implement operational savings while requiring greater transparency and accountability from the transit authority.
Recommendations related to Capital Planning
Focus capital investment exclusively on projects to repair and improve the system.
Increase the State contribution by $7 billion, primarily by shifting funds from lower impact programs, and increase the City contribution by $2 billion.
Modestly increase fares, tolls, and vehicle registration fees, dedicating them to support $6.8 billion in bonds.
Ensure labor provides the flexibility to implement $500 million in recurring operating savings to support the planned level of MTA borrowing.
Turn the tide on fare evasion.
Require the MTA to publish capital project schedules and costs, provide annual updates on project progress and asset conditions, and complete a study with an external partner to identify why MTA capital projects are so expensive.
Key Data
$30 billion
— The size of the funding gap for the MTA capital investment plan.
$7 billion
— The proposed increase in the State contribution to the MTA capital plan.
$2 billion
— The proposed increase in the City contribution to the MTA capital plan.
$6.8 billion
— The amount of bonds to be supported by increased fares, tolls, and vehicle registration fees.
$500 million
— The amount of recurring operating savings needed from labor flexibility to support MTA borrowing.
$16 billion
— The additional funding still needed for the Capital Plan beyond the proposed measures.
The Metropolitan Transportation Authority faces a $35.4 billion funding gap in its $68.4 billion 2025-2029 capital plan, necessitating a balanced approach involving increased state and city contributions, fare adjustments, and operational efficiencies. To ensure the system's reliability and state of good repair, policymakers must prioritize essential infrastructure projects while implementing accountability measures to control costs and stabilize the operating budget.
Recommendations related to Capital Planning
Focus the Capital Plan exclusively on Rebuild and Improve projects to shrink the funding gap.
Increase the City and State contribution by $9.0 billion in pay-as-you-go (PAYGO) financing to support critical investments.
Modestly increase fares, tolls, and vehicle registration fees to generate revenue to support a $6.8 billion investment.
Ensure labor provides the flexibility to generate at least $500 million in recurring operating budget savings needed to support $8 billion of the planned operating-budget-backed debt.
Require the MTA to publish project plans, user-friendly capital project status reports, regular updates on each asset group’s state of repair, and a joint study on comparative capital project costs to ensure accountability.
Key Data
$68.4 billion
— The total size of the 2025-2029 Capital Plan.
$35.4 billion
— The financing gap following the State Fiscal Year 2026 Executive Budget.
$14.0 billion
— The amount of expected federal aid to the capital plan.
$6.8 billion
— The investment amount supported by increasing fares, tolls, and vehicle registration fees.
$500 million
— The amount of recurring operating budget savings needed from labor flexibility.
New York City's land use review process is currently too long, expensive, and uncertain, adding significant costs to housing development and discouraging new projects. Reforming the Uniform Land Use Review Procedure (ULURP) by streamlining advisory reviews, creating an appeals process for rejected projects, and shifting non-zoning actions to administrative review would accelerate development and reduce unnecessary burdens.
Recommendations related to Capital Planning
Merge the Community Board and Borough President advisory reviews into a single review under the Borough President to shorten the land use review process.
Allow applicants to appeal actions rejected by the City Council to a ULURP Appeals Board consisting of the City Planning Commission and Council Speaker to balance citywide needs and neighborhood concerns.
Focus ULURP on zoning and shift review of non-zoning actions and modest rezoning applications with no adverse impacts to City agencies or commissions to streamline the approval of projects.
Key Data
$82,000
— The current land use process adds as much as $82,000 to the cost of each housing unit in 2025 dollars.
14 months
— The median time to approve dispositions of City-owned land through the Department of Housing Preservation and Development’s Urban Development Action Area Program was 14 months.
15 percent
— The current review process increases the cost of small residential buildings by at least 15 percent.
90 days
— The Community Board and Borough President advisory reviews currently take 90 days combined.
5 months
— If projects went through a one-month administrative review instead of ULURP, the process would be at least five months shorter.
$35 billion is how much of the MTA's 5-year capital plan remains unfunded. Investing in the MTA’s crumbling infrastructure is one of the most important decisions Albany will make this year; New York's economy, quality of life, and the region's competitiveness depend on it. At a recent CBC event, MTA…
Visit our Flickr page for photos of the event - https://flic.kr/s/aHBqjBZZfn . Janno Lieber was confirmed as Chair and CEO of the Metropolitan Transportation Authority (MTA) in January 2022, following his nomination to that position by Gov. Kathy Hochul. Lieber has been serving as MTA Acting Chair and CEO since…
New York City's capital projects frequently suffer from cost overruns and delays caused by outdated procurement rules, which can be mitigated by allowing the simultaneous bidding of construction and utility work. Implementing permanent authorization for joint bidding would improve project delivery timelines and generate city revenue by streamlining the coordination between contractors and utility companies.
Recommendations related to Capital Planning
The state should enact future legislation to permanently authorize joint bidding for public works contracts.
Key Data
$86.7 billion
— Total value of the September Capital Commitment Plan covering fiscal years 2025 to 2028.
$164.8 billion
— Total value of the Ten-Year Capital Strategy covering fiscal years 2024 to 2033.
77%
— Portion of the Ten-Year Capital Strategy dedicated to state of good repair work or programmatic replacement.
28 months
— Average delay resulting from utility work for street construction projects using the traditional bidding method.
7 months
— Average delay resulting from utility work for street construction projects using joint bidding.
21 months
— Additional delay time for projects without joint bidding compared to those using the method.
$16 billion is the estimated cost to build the new rail tunnel under the Hudson River. Decades of delays and funding spats ultimately led to the creation of the Gateway Development Commission, the bi-state entity responsible for making the tunnel a reality. Joining the podcast is Alicia Glen, co-Chair of…
New York City's capital expenditures reached $14.5 billion in fiscal year 2024, with significant investments directed toward education, housing, and environmental protection. Meanwhile, the city's total outstanding gross funded debt rose to $136.2 billion, reflecting the ongoing financial commitments required to maintain and expand city infrastructure.
Key Data
$14,524 Million
— Total capital expenditures for New York City in fiscal year 2024.
$136,218 Million
— Total outstanding gross funded debt for New York City in fiscal year 2024.
$4,237 Million
— Capital expenditures allocated to education in fiscal year 2024.
$2,701 Million
— Capital expenditures allocated to housing in fiscal year 2024.
$2,141 Million
— Capital expenditures allocated to environmental protection in fiscal year 2024.
$1,803 Million
— Capital expenditures allocated to transportation services in fiscal year 2024.
The Metropolitan Transportation Authority has proposed a $69 billion, five-year capital plan to address critical infrastructure needs, yet roughly half of this plan remains unfunded alongside a $15 billion deficit from the congestion pricing pause. To ensure the system's reliability, state leaders must prioritize sustainable funding, reduce fare evasion, and focus on essential repairs rather than expansion projects.
Recommendations related to Capital Planning
State leaders should unpause congestion pricing to address one-third of the funding gap.
Albany should trim and hyper-focus the plan by deferring expansion projects like the Interborough Express to prioritize rebuilding and improving the system.
The MTA should reduce fare evasion and increase efficiency to stabilize its operating budget and finance debt.
Funding for the capital plan should be sustainable, avoiding borrowing against taxes or saddling the operating budget with too much debt.
State leaders should support a tightly focused and smartly financed MTA capital plan and empower the MTA to reduce fare evasion and increase efficiency.
Key Data
$69 billion
— The size of the MTA's proposed 5-year capital plan.
$15 billion
— The funding hole created by pausing congestion pricing.
$90 billion
— The MTA's 5-year commitment goal for capital projects.
$8.6 billion
— The amount the MTA would spend for new and previously planned service expansion projects.
$1 billion
— The MTA's structural operating budget gap.
90%
— The portion of Penn Station’s electrical equipment, cables, and wiring that is in poor and marginal condition.
The proposed changes to the City's Capital Planning Process include requiring additional data in the Citywide Statement of Needs and delaying the release of the draft Ten-Year Capital Strategy. These revisions would compress the formal response and revision process involving the City Planning Commission and Borough Presidents from six to four months.
Key Data
six to four months
— The compression of the formal response and revision process for the Ten-Year Capital Strategy, involving the City Planning Commission and Borough Presidents.
The MTA's proposed 2025-2029 capital plan is overly ambitious and requires trimming to focus on essential system repairs rather than expansion projects. To ensure financial stability, the state must unpause congestion pricing, reduce fare evasion, and increase labor productivity to avoid relying on unsustainable debt and tax increases.
Recommendations related to Capital Planning
The MTA should trim the plan to a more achievable level to reduce the funding gap and transparently present what will happen in the next five years.
If the plan is not trimmed, the MTA should at least transparently schedule essential rebuild and improve projects before expansion projects.
The State should unpause congestion pricing, as any alternative makes financing these new projects harder.
The State should develop a funding plan that is sustainable, ensures riders, taxpayers, and drivers across the region pay their share, and does not harm New York’s competitiveness.
The MTA must reduce fare evasion, and labor must be a partner to increase productivity to stabilize the operating budget.
Key Data
$8.6 billion
— Proposed and previously planned expansion projects that divert resources from essential rebuilding and improvement efforts.
$10 billion
— Proposed amount in new MTA bonds that is not considered affordable.
$1 billion
— The MTA’s structural budget gap that will be exceeded by the end of the decade.
15 percent
— The portion of an operating budget that is not fully funded, making debt unaffordable.
The MTA's proposed 2025-2029 capital plan focuses heavily on rebuilding the system, yet faces significant uncertainty regarding funding sources and the ability to execute such an ambitious investment pace. To ensure fiscal stability and reliable service, the state must unpause congestion pricing, while the transit authority needs to address fare evasion and operational efficiencies to manage a structural budget gap exceeding $1 billion.
Recommendations related to Capital Planning
The State should unpause congestion pricing and then identify a funding plan that is sustainable in the long run, ensures those who benefit pay their share, and does not harm New York’s competitiveness.
Critical state of repair projects should be front-loaded, or they may not be committed in the plan period given the extremely ambitious proposed pace of investment.
To fund more capital investment and stabilize the operating budget, the MTA will have to reduce fare evasion, and the labor unions should agree to operating changes that increase efficiency.
The State should thoroughly evaluate funding options to wisely identify financing that is sustainable, allocated among the many beneficiaries, and that does not harm New York’s competitiveness.
Key Data
90 percent
— Portion of the proposed Capital Program focused on projects that rebuild and improve the system.
$68 billion
— Total investment amount in the proposed capital plan.
$96 billion
— Total investment amount when previously planned but not yet committed projects are included.
$8.6 billion
— Amount in proposed and previously planned expansion projects that diverts resources from essential rebuilding efforts.
$19 billion
— Amount the MTA would be committing annually under the proposed pace of investment.
$1 billion
— Structural budget gap the MTA will exceed by 2027, making new bond issuance fiscally unsustainable.
The MTA's capital assets are in poor condition, requiring a massive investment to rebuild and improve the system while facing a significant funding gap. To address this, the state must right-size the 2025-2029 capital program to match available capacity, prioritize essential repairs over expansion, and secure sustainable financing through measures like unpausing congestion pricing and increasing operational efficiency.
Recommendations related to Capital Planning
Adopt at most a $62.4 billion 2025-2029 Capital Program to match the maximum amount the MTA can commit over six years given the existing project overhang.
Focus the capital program exclusively on projects to Rebuild and Improve the system rather than diverting resources to expansion projects.
Unpause congestion pricing because any alternative to this funding mechanism merely reduces the options available to finance the 2025-2029 Capital Program.
Ensure financing for the 2025-2029 Program is sustainable, allocated among stakeholders region-wide, and allocated among drivers, riders, and taxpayers.
Increase productivity and reduce fare evasion to provide at least $1.5 billion in needed operating budget savings.
Key Data
$106.6 billion and $115.0 billion
— The estimated five-year cost of Rebuild and Improve projects for the MTA.
$27.6 billion
— The amount of projects from prior capital plans that will still not be committed by the end of 2024.
$62.4 billion
— The MTA's capacity for new capital investment over six years.
$16.6 billion and $25.0 billion
— The range of the 'Rebuild and Improve Commitment Capacity Gap' for the next Capital Program.
$52.9 billion
— The amount needed to finance the 2025-2029 Capital Program and previously planned projects if the program is sized to match commitment capacity.
$1.5 billion
— The amount of needed operating budget savings to be provided by increasing productivity and reducing fare evasion.
New York City requires legislative approval to utilize efficient procurement methods like joint bidding, design-build, and Construction Manager-Build for capital projects. Extending and expanding these authorizations will help the City accelerate infrastructure delivery and reduce construction costs.
Recommendations related to Capital Planning
The Governor should sign A10401/S9709 and A10400/S9710 to extend authorization of joint bidding on public works contracts for one year.
The Governor should sign A10543/S9849 to authorize New York City to contract for capital projects using design-build and Construction Manager-Build (CM-Build) procurement.
The State should enact future legislation to make joint bidding authorization permanent.
The State should expand or make permanent the legislation regarding capital project delivery methods in the future.
The NYC Ferry system, while showing improved financial performance through fare increases and operational efficiencies, remains heavily subsidized and faces long-term financial risks due to uncounted capital debt service costs. To ensure the Economic Development Corporation can fulfill its core mission, the city should reduce these subsidies by eliminating low-ridership routes and adjusting fares for non-commuters to match other premium transit services.
Recommendations related to Capital Planning
The Economic Development Corporation should eliminate the lowest-ridership routes to reduce the ferry subsidy and preserve resources for its core economic development mission.
The Economic Development Corporation should target subsidies to those in the greatest need of affordable transit options rather than providing broad, system-wide subsidies.
The Economic Development Corporation should increase fares for other riders to match those of comparable premium transit services, such as the $7 per trip charged for the MTA’s express bus system.
The Economic Development Corporation should continue to hold the line on service expansions absent rigorous analysis that they would be financially feasible.
The City should include expenditures on debt service for NYC Ferry capital costs in the official operating subsidy metrics to provide a transparent view of the system's true financial burden.
Key Data
$429.2 million
— Capital committed by the City of New York through fiscal year 2023 for NYC Ferry to acquire ferry boats, improve docks and piers, and build two homeports.
$26.4 million
— Conservative annual debt service on NYC Ferry capital commitments.
$3.99
— The additional per-trip cost when accounting for annual debt service on capital commitments.
$12.54
— The full per-ride subsidy when including debt service costs.
$56.5 million
— The annual total subsidy for NYC Ferry in fiscal year 2023.
$8.55
— The per-trip operating subsidy in fiscal year 2023.
The Governor's pause on congestion pricing has created a $15 billion funding gap in the current MTA capital program, necessitating a shift in focus toward essential infrastructure repairs. To ensure the system's stability, the MTA must prioritize critical modernization projects and develop a sustainable, fair financing plan for the 2025-2029 capital program.
Recommendations related to Capital Planning
The State should say when the congestion pricing pause will end, preferably as soon as possible or by the end of the year, so projects continue smoothly.
The State should release any remaining funds it long ago committed to the MTA’s 2020-2024 capital program.
The MTA should focus on and commit to the most critical projects to rebuild and improve the system as quickly as possible.
The MTA should propose a 2025-2029 capital program that wholly prioritizes the most critical rebuild and improve projects, and is sized to be ambitious but achievable by the end of 2029 if perfectly executed.
The 2025-2029 capital program should include a sustainable, fair financing plan—one that apportions the non-federal share regionally and appropriately across drivers, riders, and taxpayers.
Key Data
$15 billion
— financing hole opened in the 2020-2024 Capital Program by the congestion pricing pause
2020-2024
— timeframe of the current MTA Capital Program
2025-2029
— timeframe of the upcoming MTA Capital Program
Oct. 1
— deadline for producing a thoughtful 2025-2029 Capital Program
New York City's current approach to debt limits relies on arbitrary, ad-hoc increases that fail to account for long-term fiscal health or capital planning needs. A more sustainable strategy would involve indexing the Transitional Finance Authority's statutory debt limit to total personal income and formalizing a strict cap on annual debt service costs relative to tax revenue.
Recommendations related to Capital Planning
The City and State should index the TFA Statutory limit to 2.5 percent of total personal income to ensure debt capacity grows with underlying economic capacity.
Policymakers should formalize the City’s long-standing practice of keeping annual debt service costs below 15 percent of tax revenue to protect the operating budget and credit ratings.
The State should amend the Constitutional debt limit to be more holistic by creating a single limit based on an appropriate economic metric that covers all City debt repaid with tax revenues.
The City should review each capital project to determine if it is necessary and scoped and priced properly, while dropping unnecessary projects.
The City should continuously and comprehensively improve how it makes capital investments, including prioritizing projects, reducing costs, and streamlining project delivery.
Key Data
$18.5 billion
— The amount of the increase to the TFA Statutory limit requested by the City.
$12 billion
— The cumulative increase in debt capacity proposed by the State Executive Budget.
$13.5 billion
— The TFA Statutory limit as of fiscal year 2023.
$23.8 billion
— The projected TFA Statutory limit by fiscal year 2033 if indexed to 2.5 percent of total personal income.
$152.2 billion
— The total cost of the current City-funded capital plan over 10 years.
$17 billion
— The amount of additional capital spending identified by the City but not yet incorporated into its plan.
New York City's public housing authority faces a massive $60 billion five-year capital need, with current funding plans covering only 14 percent of that requirement. To address these daunting physical conditions, the authority must prioritize converting units to Section 8 through the Permanent Affordability Commitment Together (PACT) program and the Preservation Trust, as traditional capital budgets are insufficient to reverse the rapid deterioration of buildings.
Recommendations related to Capital Planning
Fix or replace deteriorating buildings with PACT and the Preservation Trust.
Improve management effectiveness and efficiency, and publicly track progress and impact.
Negotiate savings, boost productivity, and modernize property management through collective bargaining.
Overhaul the rent collection process.
Key Data
$60 billion
— Total five-year capital needs for NYCHA developments.
$8.2 billion
— Amount allocated in the five-year capital plan for 2024 to 2028.
$511 million
— Amount of federal capital funds diverted in 2022 and 2023 to fill the operating budget gap.
$373,000
— Five-year capital need per unit.
$483,000
— Twenty-year capital need per unit.
$78 billion
— Total twenty-year capital needs for NYCHA developments.
$1.5 trillion is the MTA’s total asset value—the trains, buses, yards, and stations...all the infrastructure moving New Yorkers round the clock. At a recent CBC event, MTA Chair and CEO Janno Lieber and President of Construction and Development Jamie Torres-Springer discussed congestion pricing, fare evasion, congestion pricing, state of good…
John (“Janno”) Lieber was confirmed as Chair and CEO of the Metropolitan Transportation Authority (MTA) in January 2022, following his nomination to that position by Gov. Kathy Hochul. Lieber has been serving as MTA Acting Chair and CEO since July 2021 and is the Authority’s 15th Chairperson since it was…
The MTA's Twenty-Year Needs Assessment highlights the system's precarious condition but fails to provide necessary cost and timeline details for rebuilding and improvement projects. To ensure informed decision-making regarding capital investments, the agency must publish an addendum detailing the costs and impacts of these projects, prioritizing the maintenance of existing assets over system expansion.
Recommendations related to Capital Planning
The MTA should swiftly and wisely implement congestion pricing to support the current capital plan.
The priority of keeping current assets in a state of good repair must be paramount before expanding the system.
Before releasing the capital program, the MTA should publish an addendum that includes robust cost and benefit estimates for projects to rebuild and improve the system.
The proposed addendum should include the costs and impacts on services and long-run spending if capital investments are fully, or only partially, made.
Key Data
$40 billion
— Potential cost over the next five years to begin bringing the transit system to an adequate condition.
$80 billion
— Potential cost over the next five years to begin bringing the transit system to an adequate condition.
The Metropolitan Transportation Authority's Twenty-Year Needs Assessment fails to provide necessary cost estimates for infrastructure improvements, leaving the public unable to evaluate the financial requirements for maintaining the transit system. Developing an addendum with detailed cost-benefit analyses and investment timelines is essential for informed decision-making regarding the upcoming 2025-2029 capital plan.
Recommendations related to Capital Planning
We urge the MTA to develop and publish a TYNA addendum that includes robust cost and benefit estimates for rebuilding and renewing the transit system.
We recommend a TYNA addendum include cost and benefit estimates that are sufficiently disaggregated, identify what should be invested in the next 5 and 20 years to bring the system to a state of good repair and normal replacement cycle, and identify the impacts on services and long-run costs if those investments are only partially made.
Key Data
$20 billion
— The lower end of a hypothetical cost range for bringing the transit system to a state of good repair over the next five years.
$70 billion
— The higher end of a hypothetical cost range for bringing the transit system to a state of good repair over the next five years.
The New York City Housing Authority faces $60 billion in capital needs over the next five years, a figure that has more than doubled since 2017 due to inflation and updated repair assessments. To address this massive shortfall, the city and state must streamline renovation processes and secure additional funding sources, including infill development and tax credits, to ensure projects remain financially feasible.
Recommendations related to Capital Planning
The State and City should seek to streamline the process as much as possible and not introduce additional steps that could delay the renovation process.
The City and State will need to tap additional sources of financing to help close future PACT and Preservation Trust deals.
NYCHA will need to raise additional sources of capital through infill development and phased redevelopment, where feasible, to support its capital program.
The City and State must make hard choices about how to allocate finite housing resources, potentially including Low Income Housing Tax Credits or New York’s tax-exempt bond volume cap, between NYCHA projects and other needs.
Key Data
$60 billion
— NYCHA's investment needs over the next five years.
$78 billion
— Twenty-year investment needs for NYCHA.
$1.5 billion
— City capital subsidies included in the Fiscal Year 2024 Executive Budget Capital Commitment Plan for future PACT projects through fiscal year 2026.
10 percent
— Average annual rate of inflation for unaddressed needs since 2017.
50 percent
— Increase in interest rates on loans that fund PACT projects since 2020.
25 to 30 percent
— Increase in construction costs since 2021.
The Metropolitan Transportation Authority's Twenty-Year Needs Assessment requires more comprehensive data and transparent analysis to effectively guide capital planning and investment decisions. By providing detailed information on asset conditions, costs, and future demand, the agency can better prioritize projects and foster informed public debate.
Recommendations related to Capital Planning
The MTA should include a complete accounting of the system’s current and potential future capacity needs that does not prematurely omit anything.
The MTA should disaggregate data to the functional group and component level to appropriately prioritize projects and better inform public discussion.
The MTA should include data on asset condition, needs, cost, and improvement timeframes for each investment category, functional group, and component.
The MTA should detail all projects’ benefits and costs based on rigorous analysis, standard measures, and MTA goals to bring transparency to investment choices.
The MTA should provide clear and complete data on future transportation needs based on projected economic changes and user behavior.
The Metropolitan Transportation Authority must prioritize projects in its upcoming 2025-2029 capital plan to address critical state-of-good-repair needs, as available funding will likely be insufficient to cover all requirements. With 45% of the funding for the current 2020-2024 capital plan coming from non-recurring sources, the agency faces significant challenges in securing the necessary resources for future infrastructure improvements.
Recommendations related to Capital Planning
The development of the MTA’s 2025-2029 Capital Plan should focus on bringing the system to a state of good repair by prioritizing projects, as capital needs will exceed available resources.
The MTA should prioritize projects based on needs and available funds because capital needs will exceed available funding resources.
The Twenty-Year Needs Assessment should provide elected officials, riders, and policy makers with a detailed presentation of the systems’ capital needs over the next two decades.
Key Data
$1 billion
— Annual congestion pricing revenue expected to support $15 billion in capital investment in the 2020-2024 Plan.
$15 billion
— Amount of capital investment in the 2020-2024 Plan expected to be supported by congestion pricing revenue.
45%
— Portion of the $55 billion in funding for the 2020-2024 capital plan that comes from sources that will not recur in the next cycle.
$55 billion
— Total funding for the 2020-2024 capital plan, nearly half of which comes from non-recurring sources.
NYC Budget Director Jacques Jiha briefed CBC Trustees on the New York City Fiscal Year 2024 Executive Budget. Director Jiha was appointed to serve as Budget Director in October 2020. He oversees New York City’s fiscal policy, including the development of the Expense and Capital Budgets, the City’s bond finance…
Kathryn Garcia serves as Director of State Operations and Infrastructure, where she oversees over 70 state agencies and authorities, including the MTA and Port Authority. Kathryn has over 14 years of government experience delivering services that New Yorkers rely on every day. Previously, she served as the Commissioner of the…
New York State's proposed fiscal year 2024 budget includes $14.8 billion in discretionary lump sum appropriations, which lack transparency and are often allocated outside of the standard capital planning process. These funds, which are frequently exempt from competitive bidding and oversight, risk waste and corruption by allowing elected officials to distribute money based on political considerations rather than public benefit.
Recommendations related to Capital Planning
The State should not enact any new lump sum appropriations that authorize spending on a broad range of projects or purposes to be determined and allocated at a later date.
The Governor and Legislature should omit the $6 billion Special Public Health Emergency Appropriation from the budget.
The Governor and Legislature should reduce the Special Emergency Appropriation to $1 billion, and ensure it is subject to OSC oversight and competitive procurement rules.
The Governor and Legislature should fully and completely disclose distributions from all lump sum pots currently being spent.
The Governor and Legislature should pass a law codifying the Governor’s discretionary lump sum database to include improved requirements for disclosure.
The Governor and Legislature should provide full data for lump sum spending dating back to at least 2020.
Key Data
$14.8 billion
— Total proposed State FY 2024 discretionary lump sum spending authority.
$8 billion
— Lump sums for the COVID emergency included in the $14.8 billion total.
$6.8 billion
— Total non-emergency lump sum appropriations in the FY 2024 Executive Budget.
$5.754 billion
— Total lump sums allocated for Capital Projects.
$6 billion
— The Special Public Health Emergency Appropriation included in the budget.
$2 billion
— The Special Emergency Appropriation included in the budget.
New York City's land use decision-making process is overly complex, time-consuming, and uncertain, which discourages development and hinders the city's ability to meet its housing and economic goals. To address these issues, the city and state should implement reforms to streamline environmental reviews, align land use decisions with strategic planning goals, and reduce the impact of local political vetoes.
Recommendations related to Capital Planning
New York State should amend environmental review laws to reduce barriers to beneficial growth and development.
New York State should encourage local governments to streamline approvals of projects that help achieve identified regional housing and job-creation goals.
New York City should create a process that evaluates proposals based on potential benefits and alignment with goals of its Charter-mandated strategic plan and other plans.
New York City should make advisory reviews at the community level more collaborative, participatory, and productive.
New York City should streamline and rationalize environmental review within limitations of State law.
New York City should better balance citywide needs and neighborhood concerns through an appeals process or requirement of a City Council supermajority to reject an application.
Key Data
171
— Number of private rezoning applications citywide initiated between 2014 and 2017.
103
— Number of private rezoning applications approved citywide between 2014 and 2017.
11% to 16%
— Increase in development costs caused by a two-year-long discretionary approval process.
80 percent
— Share of time spent in public review taken up by pre-certification and environmental review for the median project.
887
— Median approval time in days for private discretionary projects in New York City.
223
— Median approval time in days for projects over 50,000 square feet in Boston.
The Metropolitan Transportation Authority faces significant capital investment needs, yet its current plans are hampered by funding shortfalls and limited capacity to commit projects, with at least $12 billion in planned financing at risk or unaffordable. To address these challenges, the authority must prioritize projects that maintain safety and reduce costs, while developing a realistic, transparent 2025-2029 capital plan that aligns with actual capacity and needs.
Recommendations related to Capital Planning
The MTA should publish a $22.8 billion to $25.4 billion plan that identifies projects that can be committed by 2024.
The MTA should focus on state of good repair, normal replacement, and system improvement projects to ensure critical infrastructure needs are met.
The MTA should prioritize projects based on criteria including safety, maintenance cost reduction, and contract packaging to maximize the impact of limited capital funds.
The MTA should publish the planned schedule for the remaining outstanding projects from the 2010-2024 capital plans to improve transparency.
The MTA should develop an ambitious and solidly financed 2025-2029 capital program that incorporates projects from prior plans and current needs.
The MTA should increase the efficiency of operations to help eliminate the structural deficit, potentially creating capacity to issue debt for capital projects.
The MTA should continue to work with the federal and State governments to implement congestion pricing by 2023 to provide critical revenues for the capital plan.
The MTA should continue capital procurement improvements and reform to increase capacity and align unit costs with national and international standards.
The MTA should continue to improve capital execution to increase capacity, including using Fastrack and partial- or full-line shutdowns to accelerate projects.
Key Data
$52.9 billion
— The amount of projects still uncommitted from the 2020-2024 and two prior five-year capital plans.
$12.0 billion
— The amount of future planned capital financing that is at risk or unaffordable.
$7.1 billion
— The average annual capital commitments made by the MTA over the past six years.
$8.2 billion
— The amount of capital commitments the authority forecasts for 2022.
$30.2 billion
— The amount of projects that would still be uncommitted when the current plan period ends in 2024, assuming annual commitments increase 15 percent to the $8.2 billion target.
$27.6 billion
— The amount of projects that would still be uncommitted if annual commitments increase to $10.0 billion annually over the next two years.
The Penn Station Area Civic and Land Use Improvement Project establishes a framework for financing significant capital improvements, including station renovation and public realm enhancements, through payments in lieu of property taxes. To ensure the project delivers maximum value, oversight must prioritize economic growth, control project scope, and avoid setting precedents for future land use decisions.
Recommendations related to Capital Planning
The scope of Penn Station renovation should be tightly controlled and focused on efficient and safe passenger flow.
The State and City should resist calls to add purely cosmetic or non-essential project elements, lest an already costly project become unaffordable.
Abatements should be based primarily on promoting economic growth.
ESD should scrutinize any possible abatements based on whether projects would not be feasible without a specific PILOT discount amount.
This plan should not set a precedent for future rezonings or financings.
The City generally should lead rezonings, both within the central business district and for station area plans.
The State should continue to encourage denser development around station areas and consider intervening in local land use issues when local governments fail to enact appropriate transit-oriented development plans.
Key Data
10-year
— The duration of the property tax lookback period used to calculate 'make-whole' payments to the City.
3 percent
— The annual escalation rate applied to the 'make-whole' payments for the City.
New York State added $1.6 billion in capital projects to the fiscal year 2023 budget without rigorous evaluation or public consideration, relying instead on political considerations and lump sum appropriations. To address these budgeting failures, the state should adopt a comprehensive capital planning process that prioritizes critical needs and ensures transparency in spending.
Recommendations related to Capital Planning
The State should utilize a comprehensive capital planning process that follows the five general steps of strategic planning, needs assessment, resource identification, plan development, and implementation.
The Governor and Legislature should stop using lump sum appropriations for capital projects or otherwise, as they pose a fiscal risk and lack oversight.
The Executive should provide transparency on disbursements of existing lump sum pots by reporting details of spending, including the timing, amount, recipient, and purpose of awards.
Key Data
$1.6 billion
— Total amount of capital appropriations added to the fiscal year 2023 enacted budget that were not included in initial proposals.
$920 million
— Amount of capital appropriations allocated in lump sums that will go to projects identified behind closed doors.
$656 million
— Amount of capital appropriations allocated for specific projects added late to the budget.
$418 million
— Portion of the Buffalo Bills Stadium funding that will be paid for with current money rather than long-term bonds.
$1.2 billion
— Estimated amount of the new capital projects that may be financed through bonds, consuming State debt capacity.
The proposed Penn Station Area project requires careful financial scrutiny, as the renovation and expansion are estimated to cost between $6 billion and $7 billion and over $12 billion, respectively. To ensure fiscal responsibility, the City and State must establish a transparent financing plan that protects local tax revenue and avoids unnecessary, non-essential expenditures.
Recommendations related to Capital Planning
Before any financing plan is approved, the scope of work should be reasonably detailed, scrutinized, and streamlined as much as possible.
The State and the railroads should focus on improving safety, circulation, and functionality and doing so in the most cost-effective manner.
They should avoid costly, non-essential, cosmetic improvements and should not preclude the possibility of future capacity or service enhancements.
It is important to evaluate how the State will manage and mitigate the financing risks inherent to value capture projects, including who will be responsible for interest payments until revenue from new development comes online or who will be responsible for paying for cost overruns.
Ultimately, the Mayor and City Council should guide whether and how much of the City’s future property tax revenue should be dedicated to specific needs, such as a mass transit project, instead of other needs like public safety, education, or housing.
Key Data
$6 to $7 billion
— Estimated cost for the renovation of Penn Station.
$12 billion-plus
— Estimated cost for the expansion of Penn Station.
New York City should reject proposals to increase its borrowing capacity, as it currently expects to have $12.1 billion in debt capacity by fiscal year 2026. Instead of raising debt limits, the city should focus on improving its capital planning, prioritization, and execution to ensure cost-effective investments.
Recommendations related to Capital Planning
The State should reject the proposal to increase the New York City Transitional Finance Authority’s borrowing capacity that is outside of the City’s constitutional debt limit.
The City should improve its capital planning, prioritization, and execution to ensure that New Yorkers are being provided with cost-effective, targeted capital investments.
The City should only reconsider increasing the debt limit when it has undertaken comprehensive efforts to improve its capital planning and execution and identified specific needs.
Key Data
$12.1 billion
— The amount of debt capacity the City expects to have at the end of fiscal year 2026.
$95 billion
— The total value of the City's 5-year capital plan.
The City has an opportunity to bolster fiscal stability by depositing $2.3 billion into the Rainy Day Fund and allocating remaining resources toward one-time actions like pay-as-you-go capital programs. Implementing these measures, alongside shifting funds from capital stabilization reserves, would better prepare the city for potential revenue shortfalls of up to $19 billion during future recessions.
Recommendations related to Capital Planning
The City should use remaining resources for pay-as-you-go capital programs, to build up the Retiree Health Benefit Trust fund, or other one-time actions.
The City should shift between $250 million and $500 million annually from the general and capital stabilization reserves to the Rainy Day Fund.
Key Data
$250 million
— The amount the City Comptroller recommends shifting annually from the general and capital stabilization reserves to the Rainy Day Fund.
$500 million
— The amount previously recommended for the annual shift from the general and capital stabilization reserves to the Rainy Day Fund.
$13 billion to $19 billion
— The potential revenue shortfall the City could face over three years in the next recession, highlighting the need for fiscal preparedness.
New York City's public housing authority faces a massive capital crisis, with $32 billion in needs and 90 percent of its portfolio at risk of severe deterioration by 2027. To address this, the city must leverage RAD/PACT conversions and pass the proposed Preservation Trust legislation to secure funding for the 110,000 units that would otherwise remain without a renovation plan.
Recommendations related to Capital Planning
The City should fully integrate NYCHA into the City’s affordable housing strategy to address the capital crisis.
NYCHA must accelerate and maximize the pace of Section 8 conversions through RAD/PACT to renovate and preserve public housing.
The City should take advantage of underutilized land to raise revenue through infill development or air rights sales.
NYCHA needs to improve operations and construction management to address its capital needs.
The State must ensure the passage of the proposed Preservation Trust legislation (S6999A/A7805) to secure funding for remaining public housing units.
The Council should join NYCHA and City Hall in lobbying for State and federal actions needed to pass the Trust.
Key Data
$32 billion
— The estimated capital needs of NYCHA as documented in a 2018 report.
90 percent
— The portion of NYCHA's portfolio at risk of deteriorating to poor conditions by 2027 without action.
$3.2 billion
— The amount of capital improvements financed through RAD conversions as of early 2022.
62,000 units
— The maximum number of units NYCHA can convert under its federal cap for the RAD program.
110,000 units
— The number of public housing units that would remain in the Section 9 program without additional funding.
400,000 residents
— The number of people living in NYCHA housing who deserve safe and habitable conditions.
Lorraine Grillo is the First Deputy Mayor of the City of New York, appointed by Mayor Eric Adams. Grillo's direct reports include Deputy Mayors for Economic and Workforce Development, Operations, Strategic Initiatives, and Human Services, as well as the Office of Management and Budget, Department of Finance, Chief Housing Officer,…
Local Law 97 mandates significant greenhouse gas emissions reductions for large buildings, requiring owners to undertake major capital investments to upgrade building envelopes and cooling systems to avoid penalties. To ensure cost-effective compliance, the City should refine rulemaking to address challenges like renewable energy availability, density disincentives, and the economic impacts of the pandemic.
Recommendations related to Capital Planning
Adjust credits appropriately for lack of renewable energy availability to encourage electrification: If the greening of the grid is slower than established by the New York State Climate Leadership and Community Protection Act, the law’s credits for beneficial electrification should be calculated accounting for those missed goals.
Expand allowable RECs to offshore wind and a portion of Tier 2 RECs: Provide buildings with flexibility while the New York City electric grid remains mostly fossil fuel-powered by allowing buildings to purchase unlimited amounts of RECs associated with downstate offshore wind projects and limited amounts of existing RECs from existing generation.
Specify, expand, and continue emission limit adjustments for density and specific uses: Alleviate counterproductive disincentives to density and certain economically vital uses by clearly adjusting and extending adjustments past the first compliance period.
Specify and extend need-based building-level adjustments: Set an accelerated, public timeline for rulemaking that includes critical rules governing limit adjustments and penalty mitigation and universal criteria so building owners can determine eligibility and adjusted requirements as-of-right, rather than through individual petitions.
Allow carbon trading within an owner’s portfolio: Allow owners of multiple buildings to target the most cost-effective emissions reductions across their assets by establishing a carbon trading scheme that allows credits to be traded within a portfolio.
Adjust limits and penalties appropriately to the post-pandemic economy: Study whether LL97 emissions limits or alternative compliance paths in the first compliance period should be modified due to permanent shifts in work patterns, delays in retrofit projects, or financial strain.
Key Data
$268
— The maximum annual fine per metric ton for buildings with emissions above the limit.
40 percent
— The goal for cutting emissions from large buildings by 2030.
80 percent
— The goal for cutting emissions from large buildings by 2050.
20 percent
— The amount the median building will need to reduce emissions by 2024.
33 percent
— The amount the median building will need to reduce emissions by 2030.
24 percent
— The share of buildings needing to cut emissions by more than half to comply with 2030 standards.
New York City's adopted capital commitment plan for fiscal years 2022 through 2025 totals $80.4 billion, while the ten-year strategy extending through fiscal year 2031 amounts to $147 billion. Future capital plans will reveal how the administration intends to adjust total spending, timing, and resource allocation across programmatic areas like infrastructure and schools.
Key Data
$80.4 billion
— Total value of the City’s Adopted Capital Commitment Plan for fiscal years 2022 through 2025.
$147 billion
— Total value of the ten-year capital strategy through fiscal year 2031.
2026 is the year the MTA will likely have spent all of its one-time COVID-19 federal aid, and when the MTA will have to address the estimated $2.5 billion annual structural operating deficit which that aid is now covering. At an event with CBC Trustees, MTA Chair and CEO Janno…
John (“Janno”) Lieber was appointed Acting Chair and CEO of the MTA in July 2021. Prior to that he was MTA’s Chief Development Officer and President of Construction & Development where he was responsible for capital planning and for the development and delivery of capital projects across the MTA. From…
New York State lacks a comprehensive, long-term capital planning process for its infrastructure assets, which is particularly concerning given the recent influx of federal infrastructure funding. To maximize the benefits of these investments, the state should adopt a rigorous system that includes benefit-cost analysis, better identification of needs, and continuous assessment of project progress across all infrastructure categories.
Recommendations related to Capital Planning
The State should improve its capital planning processes by broadly adopting benefit-cost analysis to better identify needs and resources.
The State should identify, allocate, and implement new federal infrastructure funds to maximize their benefits.
A complete, comprehensive capital planning approach should be implemented to cover all infrastructure categories, not just transportation.
The State should plan for maintenance and improvements and continuously assess the progress of its work.
Key Data
one-sixth
— Federal funds currently make up <b>one-sixth</b> of total capital spending by the State.
$15 billion
— Congestion pricing is expected to generate $1 billion in annual contributions, which would support <b>$15 billion</b> in investment for the MTA capital plan.
110,000
— The Preservation Trust would allow for the renovation of <b>110,000</b> public housing units.
Legislation requiring the Department of Transportation to file annual reports on planned projects, infrastructure conditions, and public transportation needs should be signed to improve the state's capital planning process. If the bill is vetoed due to costs, its provisions and requirements for long-term, intermodal planning should be incorporated into the fiscal year 2023 budget.
Recommendations related to Capital Planning
The Governor should sign S199B/A4010B to improve capital planning and reporting for transportation infrastructure in New York State.
If the bill is vetoed on the grounds of having an unfunded cost, its provisions—plus additional provisions for long-term, intermodal planning—should be included in the fiscal year 2023 budget.
The State should pursue further enhancements to the transportation capital planning process to ensure it extends into the long-term and provides necessary performance metrics.
Key Data
$1 million
— The estimated unfunded cost of the 2019 bill A4880/S1673, which was vetoed by the governor.
The New York City Housing Authority faces capital needs exceeding $40 billion, prompting a significant increase in city capital funding to $4.6 billion through 2031. To ensure these funds are used effectively, the city must implement procurement reforms, such as authorizing construction manager-build methods and creating a Preservation Trust to finance future repairs.
Recommendations related to Capital Planning
State lawmakers should act swiftly to grant NYCHA authorization to use construction manager-build or construction manager-at risk procurement methods.
NYCHA’s federal monitor, along with NYCHA and the City, should strongly advocate for HUD to grant waivers from restrictive federal public housing procurement rules.
City and State lawmakers should create the Preservation Trust, since it will provide NYCHA with additional options to finance needed capital investment.
NYCHA must manage the renovated properties well, requiring real changes, such as those outlined in NYCHA’s Blueprint for Change, to operate like a modern and effective property management organization.
Key Data
$40 billion
— NYCHA's total capital needs due to years of underinvestment, mismanagement, and cost inflation.
$4.6 billion
— Planned capital commitments for NYCHA in the Fiscal Year 2022 Adopted Capital Commitment Plan through fiscal year 2031.
$300 million
— City capital funding included in the Department of Housing Preservation and Development’s capital plan for PACT projects.
$65 billion
— Federal capital funding for public housing under the Build Back Better legislation that NYCHA stands to gain a significant share of.
39 percent
— Amount by which NYCHA's per-unit operating costs were higher than private sector costs in 2015.
$2.8 billion
— Funding included in the Capital Commitment Plan for building improvements, including comprehensive modernization projects.
New York's congestion pricing program is designed to generate $1 billion annually to support $15 billion of the MTA's $55 billion, 5-year capital program. To ensure the program's success, policymakers should implement variable tolling, limit exemptions, and consider future vehicle miles traveled fees to effectively manage traffic and fund critical infrastructure repairs.
Recommendations related to Capital Planning
Vary the congestion charge to prioritize both raising revenue and reducing congestion and emissions.
Limit exemptions to transit providers, those specified in the law, and perhaps to for-hire vehicles and taxis, as proliferating exemptions could reduce the program’s ability to raise the needed revenue, increase congestion and emissions, and risk the program’s support.
Do not provide credit for payment of MTA or Port Authority of New York and New Jersey tolls, as credits increase the congestion charge for those who pay, and may increase traffic and congestion.
Vary the congestion charge while ensuring it is easy to understand and well communicated to enable drivers to know how much they would pay for different trip times and modify their trips accordingly.
Consider charging a vehicle miles travelled fee for those that stay in the zone to help reduce congestion from vehicles searching for parking, taxis, and FHVs circling for passengers.
Monitor and report congestion pricing outcomes and operational metrics to inform future policy adjustments and ensure the program is meeting its revenue, congestion, and emissions goals.
Key Data
$1 Billion
— Annual revenue generated by the congestion pricing program to support the MTA's capital program.
$15 Billion
— Amount of the MTA's capital program supported by the congestion pricing revenue.
$55 Billion
— Total value of the MTA's 5-year capital program.
$2.50
— Congestion pickup fee authorized for taxis.
$2.75
— Congestion pickup fee authorized for for-hire vehicles (FHVs).
$150 million is the amount of capital funding NYC has committed toward the creation of a Center for Climate Solutions on Governors Island. Joining the podcast to discuss this and other plans for Governors Island is Alicia Glen, Chair of the Trust of Governors Island and the former Deputy Mayor…
The next New York City Comptroller will play a critical role not only in holding the next Administration and agencies accountable, investing and managing five pension funds with $248 billion in assets, and partnering in $13 billion City debt issuance, but also in spotlighting and promoting New York City’s fiscal…
Sarah Feinberg was appointed Interim President of New York City Transit in February 2020. Feinberg oversees the 48,000 person workforce of NYCT, as well as operations for New York City subways, buses, paratransit services, and the Staten Island Railway. Feinberg served as the Federal Railway Administrator from 2015 to 2017.…
800,000 is the approximate number of daily passengers who travel on Northeast Corridor trains. The only rail link that connects New York and New Jersey is through a 110-year-old tunnel under the Hudson River. The Biden administration has pledged to move forward the Gateway Program―the planned, phased expansion and renovation…
Managing the City’s fiscal crisis well will be a critically important duty of the next Mayor and a primary determinant of how the city survives the current crisis, and ultimately thrives in the future. Managing NYC’s Fiscal Crisis: A CBC Mayoral Candidate Forum featured a 10-minute conversation with each candidate,…
The proposed comprehensive planning framework for New York City, while aiming to improve long-term strategy, risks diminishing the effectiveness of capital budget reports and unnecessarily complicating the process by linking capital reforms to land use changes. Instead of devolving budget authority, the city should focus on conducting a comprehensive capital needs assessment and maintaining the current biennial update cycle for the Ten-Year Capital Strategy to ensure responsiveness to changing conditions.
Recommendations related to Capital Planning
The City should conduct a comprehensive capital needs assessment that identifies its state of good repair needs.
The City should link the Ten-Year Capital Strategy with the City’s strategic plans.
The Mayor should retain the role of submitting a capital budget to the Council.
The Mayor should retain the right to propose how to prioritize investments based on strategic planning documents, a revamped AIMS report, or a newly conducted comprehensive physical needs assessment.
The City should maintain the biennial updates to the Ten-Year Capital Strategy to allow the City to respond quickly to changing conditions and needs.
Key Data
78%
— Percentage of spending in the Preliminary Fiscal Year 2022 Ten-Year Capital Strategy dedicated to state of good repair needs or programmatic replacement.
$92 billion
— Amount of spending in the Preliminary Fiscal Year 2022 Ten-Year Capital Strategy allocated for state of good repair needs or programmatic replacement.
New York State can balance its budget without increasing personal income taxes by pursuing alternatives such as appropriately financing capital investment, eliminating unproductive economic development spending, and targeting education aid to low-wealth districts. Even if the state receives only $6 billion in federal aid, these measures could help maintain fiscal stability while avoiding the risk of driving high-income earners out of the state.
Recommendations related to Capital Planning
The State should appropriately finance capital investment as a strategy to balance the budget.
New York State can balance its budget without raising income taxes by shifting capital financing to long-term debt and reducing unproductive economic development spending. These strategies would provide billions in savings, allowing the state to avoid tax increases and preserve middle-class tax cuts while maintaining fiscal stability.
Recommendations related to Capital Planning
To avoid adding to already high outstanding debt levels, the State should focus its capital investments on the most critical projects during this period.
If the State reduces its planned capital disbursements by 10 percent and finances up to 50 percent of the remaining paygo capital spending with debt, it would save $1.6 billion in fiscal year 2022.
A 50 percent reduction in proposed economic development capital spending plus financing 50 percent of the remaining paygo spending with debt would yield another $713 million in fiscal year 2022.
Key Data
$1.6 billion
— Projected savings in fiscal year 2022 from reducing planned capital disbursements by 10 percent and financing 50 percent of remaining paygo capital spending with debt.
$713 million
— Projected yield in fiscal year 2022 from a 50 percent reduction in proposed economic development capital spending combined with financing 50 percent of remaining paygo spending with debt.
50 percent
— Proposed reduction in economic development capital spending.
10 percent
— Proposed reduction in planned capital disbursements.
New York City's outstanding debt reached $125 billion by the end of fiscal year 2020, representing an 84 percent increase since 2005. This rising debt burden, which includes various financing vehicles for capital projects, resulted in debt service costs consuming nearly 11 percent of tax revenues in 2020.
Key Data
$125 billion
— New York City debt outstanding at the end of fiscal year 2020.
84 percent
— Growth of total New York City debt since 2005.
11 percent
— City-supported debt service costs as a share of tax revenues in fiscal year 2020.
New York City's capital expenditures in the fourth quarter of fiscal year 2020 fell to $1.5 billion, the lowest level in a decade, as the city halted or delayed projects to preserve cash. This slowdown significantly impacted major initiatives, including a 50 percent drop in capital commitments for Housing New York projects and a substantial reduction in School Construction Authority commitments compared to planned levels.
Key Data
$1.5 billion
— Capital expenditures in the fourth quarter of fiscal year 2020, the lowest in a decade.
$2.6 billion
— Capital expenditures in the fourth quarter of fiscal year 2019.
50 percent
— Drop in capital commitments for Housing New York projects.
$761 million
— Housing New York capital commitments in fiscal year 2020.
$1.8 billion
— School Construction Authority commitments made in fiscal year 2020.
$4.8 billion
— Planned School Construction Authority commitments for fiscal year 2020.
New York City can reduce its five-year capital plan by $6.7 billion by scaling back new school construction and limiting expansion projects, which would also generate significant debt service savings. These measures, alongside other expenditure reductions, help address the city's severe fiscal crisis without resorting to long-term borrowing or mass layoffs.
Recommendations related to Capital Planning
The five-year capital plan could be reduced by $2.4 billion through operational strategies to reduce planned new school construction.
The City should reduce the capital plan by $4.3 billion by delaying and limiting expansion projects.
City officials should generate debt service savings by reducing capital investments, which would save $50 million in fiscal year 2022, $100 million in fiscal year 2023, and $150 million in fiscal year 2024.
Key Data
$2.4 billion
— Reduction to the five-year capital plan through operational strategies to reduce planned new school construction.
$4.3 billion
— Reduction to the five-year capital plan by delaying and limiting expansion projects.
$50 million
— Debt service savings generated in fiscal year 2022 from reducing capital investments.
$100 million
— Debt service savings generated in fiscal year 2023 from reducing capital investments.
$150 million
— Debt service savings generated in fiscal year 2024 from reducing capital investments.
10 percent
— The portion of the current city-funded capital plan that would be cut by reducing school construction and limiting expansion projects.
Governments can achieve operating budget savings by reducing the amount of capital investment financed by borrowing or by postponing non-essential projects. To avoid jeopardizing critical infrastructure, officials should prioritize cuts to projects that are not essential or are considered "political pork" rather than neglecting necessary repairs.
Recommendations related to Capital Planning
Governments should minimize the risk of neglecting essential infrastructure by making cuts to capital projects that are not for essential infrastructure (including projects characterized as “political pork”) or projects that are otherwise desirable expansions or enhancements that can safely be postponed.
To achieve operating budget savings, governments can reduce the amount of capital investment financed by borrowing.
Key Data
$100 million
— Amount of capital spending avoided that results in debt service savings.
$6.5 million
— Annual savings in debt service achieved by avoiding $100 million of capital spending at current interest rates for 30-year bonds.
NYCHA's 2020 operating budget reflects a growing reliance on City subsidies and capital transfers to cover rising labor costs and operational expenses, despite a shrinking portfolio. The authority faces significant fiscal risks as it attempts to implement mandated organizational changes while struggling with stagnant rental income and a declining rent collection rate.
Recommendations related to Capital Planning
NYCHA’s forthcoming organizational plan must include a program to boost the rent collection rate and maintain it going forward.
NYCHA’s fiscal stability depends on future labor settlements being financially sustainable and providing enough flexibility for NYCHA to implement its turnaround plan.
Personnel shifts must be accompanied by a combination of additional funding, reallocation of resources, spending cuts, or productivity enhancements to avoid structural imbalances.
Stabilizing the housing authority's fiscal outlook must be front and center in discussions regarding the forthcoming organizational plan.
Key Data
$3.7 billion
— Projected operating revenues for NYCHA in 2020.
$110 million
— Amount of tenant rent and arrears NYCHA failed to collect in city fiscal year 2019.
$1,052
— Self-reported management cost per unit per month in city fiscal year 2019.
$236 million
— Amount transferred from the capital budget to the operating budget in the 2020 operating budget.
$91 million
— Projected surplus for NYCHA in 2020.
To support effective infrastructure investments, New York State should adopt a five-year Department of Transportation capital program based on a comprehensive statewide capital planning process rather than reducing the planning horizon to two years. Additionally, expanding the use of design-build to other state agencies and information technology systems would help reduce the high costs of public construction projects.
Recommendations related to Capital Planning
The State should adopt a five-year Department of Transportation (DOT) capital program based on a comprehensive statewide capital planning process.
Rather than decreasing planning horizons, the State should enact provisions similar to those passed by the Legislature in 2019 to implement a rigorous capital planning process for the Department of Transportation.
Enacting best practices for capital planning and programming will support more effective investments in the State’s transportation infrastructure.
The State should adopt the Governor’s proposal to expand the use of design-build, which allows for consolidating the design and construction bidding process, to other state agencies and to information technology systems.
Key Data
two-year
— Department of Transportation capital program proposed in the Executive Budget, which is a reduction from the typical planning horizon.
five-year
— typical duration of the Department of Transportation capital program.
The Metropolitan Transportation Authority's $54.8 billion 2020-2024 capital plan is overly ambitious, as it includes $70 billion in projects that the agency is unlikely to complete within the five-year timeframe. To ensure stability and reliability, the agency must prioritize essential infrastructure repairs and provide a transparent, scheduled roadmap for project implementation rather than relying on volatile revenue streams for long-term debt.
Recommendations related to Capital Planning
The MTA should allocate its human and financial resources to the highest priority projects, and its capital plan documents should reflect these priorities by including, at minimum, the year in which the MTA plans to commit and complete each project.
The MTA should provide the detail needed and present a five-year plan for investment so the MTA Board, oversight bodies, and the public can assess whether it is appropriate and hold the MTA accountable for implementation.
The MTA and other public officials must ensure that exemptions and credits to the central business district tolling charge are limited, so that the revenue promised is available to support the plan.
Rather than using this volatile revenue source to support debt, the MTA should consider the new real estate transfer taxes a source for pay-as-you-go capital projects.
The plan that is ultimately approved and executed over the next five years should focus on the priority projects that will yield the greatest benefits for system reliability, accessibility, and customer service.
Key Data
$54.8 billion
— The proposed 2020-2024 Capital Program total.
$70 billion
— The total value of projects planned, including previously approved projects.
$15 billion
— Previously planned and approved capital projects that have yet to be committed.
$6 billion
— The average annual capital project commitment rate from 2010 to 2018.
$14 billion
— The annual projected commitment rate required to execute the new capital plan and backlog in five years.
$1 billion
— The estimated annual revenue generated by central business district tolling.
The Metropolitan Transportation Authority’s $54.8 billion 2020-2024 Capital Program is overly ambitious, as the agency is unlikely to be able to commit the necessary $70 billion in projects within the five-year timeframe given its historical performance. To ensure success, the agency must prioritize the most impactful projects, provide a clear, detailed investment blueprint, and reconsider using volatile real estate tax revenues to support long-term debt.
Recommendations related to Capital Planning
The MTA should prioritize the most impactful projects and initiate those as soon as practicable.
The MTA should allocate its human and financial resources to the highest priority projects, and its capital plan documents should reflect these priorities by including, at minimum, the year in which the MTA plans to commit and complete each project.
The MTA should provide the detail needed and present a five-year plan for investment so the MTA Board, oversight bodies, and the public can assess whether it is appropriate and hold the MTA accountable for implementation.
Public officials must ensure that exemptions and credits to the central business district tolling charge are limited, so that the revenue promised is available to support the plan.
Rather than using volatile real estate transfer taxes to support debt, the MTA should consider this a source for pay-as-you-go capital projects.
Key Data
$54.8 billion
— The total proposed value of the 2020-2024 Capital Program.
$70 billion
— The total value of projects planned, including the new program and previously approved projects.
$6 billion
— The average annual capital project commitment rate from 2010 to 2018.
$14 billion
— The required annual commitment rate to execute both the new capital plan and the backlog of projects in five years.
$13.6 billion
— The amount allocated to state of good repair projects in the 2020-2024 capital plan.
$1 billion
— The estimated annual revenue generated by central business district tolling.
New York State's transportation infrastructure planning requires legislative reform to move away from politically motivated budgeting and toward informed evaluations of resources and needs. Signing A4880/S1673 would mandate long-term planning, public hearings, and increased transparency regarding project delays and cost overruns to address the state's deteriorating roads and bridges.
Recommendations related to Capital Planning
The Governor should sign A4880/S1673 to improve capital planning for transportation infrastructure in New York State.
The State Department of Transportation should be required to develop a 20-year intermodal transportation capital plan.
The State Department of Transportation should be required to develop a 5-year capital plan for transportation projects.
The State Department of Transportation should be required to hold regional hearings on transportation capital planning.
The State Department of Transportation should be required to biannually submit to the Governor and Legislature a list of current and planned transportation capital projects.
The State Department of Transportation should be required to provide explanations of major delays and cost overruns on individual projects.
Subsequent legislation should require the State Department of Transportation to outline goals and strategies for maintaining and improving transportation assets.
Subsequent legislation should require the State Department of Transportation to make public a summary of the inventory of assets, asset quality, recently completed projects, and performance relative to predetermined goals.
New York City Housing Authority facilities face a $31.8 billion capital need over five years, while the 10-year NYCHA 2.0 plan provides only $15.8 billion, leaving an $8.4 billion funding gap. Furthermore, the city allocates $3.83 billion of its $6.85 billion in total tax expenditures toward housing programs.
Key Data
$31.8 billion
— NYCHA's 5-Year Capital Needs.
$15.8 billion
— Funding provided by the 10-year NYCHA 2.0 Plan.
$8.4 billion
— Unmet capital need in the NYCHA 2.0 Plan.
$6,853 million
— Total New York City tax expenditures in fiscal year 2019.
$3,830 million
— New York City tax expenditures allocated to housing programs in fiscal year 2019.
$29.6 billion
— New York City property tax revenue in fiscal year 2020.
The New York City Housing Authority's "NYCHA 2.0" plan aims to address a $31.8 billion capital need through public-private partnerships and infill development, but progress is threatened by funding delays and federal regulatory hurdles. Without successful implementation, thousands of units annually risk falling into disrepair, exacerbating the authority's already significant maintenance backlog and physical deterioration.
Recommendations related to Capital Planning
The federal monitor should work with the new Chair to identify changes to federal laws and regulations that would support the turnaround efforts.
The federal monitor should work to increase funding for federal operating and capital subsidies.
The federal monitor should work to improve the Rental Assistance Demonstration (RAD) program by lifting the cap on conversions.
The federal monitor should work to exempt RAD conversions from the tax-exempt private activity bond cap.
The federal monitor should work to create dedicated tax credits for the RAD program.
The federal monitor should work to lift the federal prohibition on design-build and best value procurement for federally-funded capital projects.
The federal monitor should work to secure additional appropriations for tenant protection vouchers.
The federal monitor should work to allow for more flexible use of federal capital and operating dollars, in part to allow for the reinvestment of operating savings into capital upgrades.
Key Data
$31.8 billion
— Total five-year capital needs for the housing authority.
$23.8 billion
— Total funding identified over 10 years to address capital needs.
$12.8 billion
— Funding generated from accelerating the pace of public-private partnerships under the PACT program.
$2 billion
— Funding generated from additional infill development.
$1 billion
— Funding generated from the sale of transferrable development rights.
$7.9 billion
— Amount of existing funding assumed in the plan.
The Metropolitan Transportation Authority's proposed $51.5 billion capital plan faces significant questions regarding its spending priorities, the authorization of $6 billion in combined state and city funding, and the agency's capacity to execute a project list 70 percent larger than its predecessor. Ensuring the plan's success requires a comprehensive needs assessment, verified financing commitments, and a rapid acceleration in project implementation.
Recommendations related to Capital Planning
The MTA must make public a comprehensive needs assessment to ensure the plan is spending money on the right things.
The MTA must secure authorized funding commitments of $3 billion from New York State and $3 billion from New York City to ensure the financing plan is sound.
The MTA must accelerate rapidly the pace to execute projects to successfully implement a plan that is 70 percent larger than the previous one.
Key Data
$51.5 billion
— Total investment proposed in the region’s mass transit network.
$3 billion
— Funding assumed from New York State that has not yet been authorized.
$3 billion
— Funding assumed from New York City that has not yet been authorized.
$9.8 billion
— Amount in bonds and pay-as-you-go capital that the MTA may struggle to finance given projected operating deficits.
70 percent
— The size increase of the proposed 2020-2024 capital plan compared to the 2015-2019 capital plan.
65 percent
— The portion of the 2015-2019 capital plan committed as of June 2019.
The Metropolitan Transportation Authority's five-year capital plans have grown significantly, increasing from $24,118 million in the 2010-2014 period to $33,270 million in the 2015-2019 period. To fund the 2020-2024 capital program, central business district tolling is expected to generate $15 billion.
Key Data
$24,118 Million
— Total spending for the 2010-2014 5-year capital plan.
$33,270 Million
— Total spending for the 2015-2019 5-year capital plan.
$15 Billion
— Amount of the MTA's 2020-2024 capital program that must be supported by central business district tolls.
New York City's reliance on new school construction to address crowding is expensive, slow, and often poorly targeted, with the current capital plan costing billions. Instead, the city should prioritize more cost-effective strategies like rezoning, repurposing existing seats, and adjusting admission policies to reduce the need for new construction and save at least $2.4 billion.
Recommendations related to Capital Planning
New school construction should be used only when alternative strategies are inadequate.
A more flexible system of overlapping or grouped zones could more effectively balance enrollment between nearby crowded and non-crowded elementary school buildings.
High school crowding could be solved by capping enrollment at levels consistent with the DOE capacity standards, because adequate high school capacity exists citywide.
Administrative office activities could be moved to other office space rather than school buildings, using this space for classrooms to reduce crowding.
Middle schools could be consolidated to fully or partially vacate a building that could be converted to an elementary or K-8 school.
Key Data
$2.4 billion
— Potential reduction in planned fiscal year 2020 to 2024 capital plan spending by substituting alternative strategies for new construction.
$150 million
— Annual debt service savings for New York City and State from reduced capital spending.
95,984 seats
— Total shortage of seats across 618 crowded school buildings.
$7.9 billion
— Funding included in the DOE’s capital plan for fiscal years 2020 to 2024 for 89 new school buildings.
16,000 seats
— Estimated additional capacity that could be gained through more flexible elementary school zoning.
31,854 students
— Excess enrollment in 93 crowded high school buildings.
New York State is nearing its statutory debt limit, which severely restricts its ability to finance new capital projects. Consequently, the state should prioritize essential infrastructure investments over discretionary "pork-barrel" spending and allocate funds during the formal budget process.
Recommendations related to Capital Planning
The State should limit capital spending to investments justified on the basis of need or rate of return.
The State should be very cautious about adding more debt to finance capital spending.
State debt should only be issued for capital investments that are justified by need for repair or service enhancement identified through a systematic evaluation of state needs.
The legislature should close out session without passing any capital pork.
Absent an emergency, State spending should be allocated during the budget process, where state leaders can adequately consider priorities and tradeoffs.
If the State is going to add debt-funded capital appropriations, the additional spending should be limited to significant state infrastructure investments.
Key Data
$1.4 billion
— Debt capacity available in fiscal year 2021.
$107 million
— Available debt capacity remaining by fiscal year 2024.
$1.9 billion
— Amount authorized for the State and Municipal (SAM) Facilities Program to provide small grants to local governments and nonprofits.
$157 million
— Reappropriation from 2008 for the New York State Capital Assistance Program.
$475 million
— Amount of SAM funding included in the fiscal year 2019 budget.
4 percent
— Statutory cap on state debt relative to personal income.
New York City's land use and capital planning processes should be improved by expanding the capital asset inventory to include all assets owned by city-controlled agencies that meet specific financing criteria. Additionally, capital budget allocations made by Borough Presidents should be required to align with the city's 10-year capital strategy to ensure better coordination of planning documents.
Recommendations related to Capital Planning
The Commission should expand the Charter-defined components of the capital asset inventory to include all assets that meet capital financing eligibility criteria, currently $35,000 and a five-year useful life, that are owned by an agency or authority that the City controls to improve the City’s land use and capital planning documents.
The Commission should require the capital budget Borough President allocations to align with the City’s 10-year capital strategy if it seeks to align the various planning documents.
Key Data
$35,000
— The current capital financing eligibility criteria threshold for assets included in the capital asset inventory.
10-year
— The duration of the capital strategy that Borough President capital budget allocations should be required to align with.
New York State faces a significant funding gap for transportation infrastructure, with $2.1 billion in necessary road and bridge repairs currently deferred. Implementing a vehicle-miles traveled (VMT) fee, which charges users based on distance traveled, offers a sustainable and equitable solution to replace declining fuel tax revenues and address these capital needs.
Recommendations related to Capital Planning
New York should phase in implementation to allow the public sector to build expertise in a new area of revenue generation.
The State should require commercial fleets to transition to a VMT fee, as these heavier vehicles impose high costs on highways.
New York should create a volunteer program for passenger vehicles to build public awareness and encourage acceptance.
The State should maintain flexibility to accommodate new technology by remaining technologically agnostic and not committing to a single, proprietary platform.
New York should establish rates that vary by type of vehicle and location, with higher rates for urban miles and heavier vehicles.
Key Data
$5.7 billion
— Annual investment required for the State to achieve a state of good repair on its assets.
$2.1 billion
— Amount of necessary repair work that is currently deferred.
51 percent
— Reduction in the inflation-adjusted per-mile direct cost to motorists who travel on State roadways since 1993.
123 billion miles
— Estimated distance traveled by motorists in New York State in 2016.
$1 billion
— Potential annual revenue yield from an average per-mile fee of 1 cent.
95 percent
— E-ZPass market share for weekday transactions on Triborough Bridge and Tunnel entities as of May 2018.
The NYC FY 2020 Executive Budget increases the 10-year capital strategy to $116.9 billion, a growth of $12.8 billion from the preliminary budget. While the city maintains $1.25 billion in annual capital reserve funds, the capital strategy requires more comprehensive planning and prioritization centered on state of good repair work.
Recommendations related to Capital Planning
The 10-year capital strategy could benefit from more comprehensive planning and prioritization focusing on state of good repair work.
Key Data
$116.9 billion
— Total value of the 10-year capital strategy.
$12.8 billion
— Growth of the 10-year capital strategy from the Preliminary Budget.
$1.25 billion
— Annual amount budgeted for contingency and capital reserve funds.
The NYC Ferry system requires significant public subsidies due to high operating costs and low farebox recovery, with capital commitments for the system totaling $638.5 million as of February 2019. City officials should reconsider the current operating strategy, pricing model, and expansion plans to ensure transportation funding is used more efficiently and effectively.
Recommendations related to Capital Planning
City officials should reconsider the policy choices that contribute to the high subsidies, evaluate options that would reduce the level of subsidy, and consider whether alternative uses would meet the city’s transportation needs more efficiently and more effectively before implementing further service expansions.
The City should implement dynamic pricing models for long, low-productivity routes that require substantial subsidies and see demand spikes on weekends.
City officials should charge higher fares on weekends and for noncommuters to offset the cost of subsidies for daily commuters.
The City should adopt a different fare structure to mitigate the need to charter vessels or purchase larger boats.
City officials should review the system’s costs and subsidies to determine if maintaining the current operating strategy, pricing model, and expansion plans represents the most efficient use of transportation funding.
Key Data
$638.5 million
— Total capital commitments for the NYC Ferry system as of February 2019.
$108 million
— Upfront capital costs for building new landings and purchasing additional ferries for the planned expansion.
$48.6 million
— Annual debt service payments at full buildout of the ferry system.
$56.7 million
— NYC Ferry operating costs in fiscal year 2018.
$10.73
— Public subsidy per ride for NYC Ferry in fiscal year 2018.
The New York State fiscal year 2020 budget establishes new revenue streams, including congestion pricing, increased real estate transfer taxes, and sales tax intercepts, to fund the Metropolitan Transportation Authority's 2020-2024 capital plan. These dedicated funds, totaling an estimated $1.685 billion annually, are directed into a "CBD Tolling Capital Lockbox" to support $25 billion in capital investments for transit infrastructure.
Key Data
$25 billion
— Total amount of the MTA's 2020-2024 Capital Plan expected to be supported by new revenue resources.
$1.685 billion
— Estimated annual yield from all new resources deposited into the CBD Tolling Capital Lockbox.
$1 billion
— Estimated annual revenue generated by the congestion pricing program to support capital investment.
$365 million
— Estimated annual revenue generated by the two newly enacted real estate transfer tax surcharges.
The NYC Ferry system requires high public subsidies due to low farebox recovery and high operating costs, with planned expansions expected to further increase these financial burdens. City officials should reevaluate the current operating strategy, pricing model, and expansion plans to ensure a more efficient and effective use of transportation funding.
Recommendations related to Capital Planning
City officials should reconsider the policy choices that contribute to the high subsidies.
City officials should evaluate options that would reduce the level of subsidy.
City officials should consider whether alternative uses would meet the city’s transportation needs more efficiently and more effectively.
EDC and City officials can charge higher fares on weekends and for noncommuters to offset the cost of subsidies for daily commuters.
Dynamic pricing models could be more appropriate for long, low-productivity routes that require substantial subsidies and see demand spikes on weekends.
Key Data
$10.73
— The per-ride operating subsidy for the NYC Ferry system.
$24.75
— The projected per-ride subsidy for the proposed Coney Island ferry route.
$638.5 million
— The total capital commitments for the NYC Ferry system as of February 2019.
$48.6 million
— The annual debt service cost at full buildout of the ferry system.
$56.7 million
— The operating costs for the NYC Ferry system in fiscal year 2018.
22%
— The farebox operating ratio for the NYC Ferry system in 2018.
The City Charter should be revised to eliminate the requirement that 5 percent of capital appropriations be set aside for Borough Presidents and that 0.9 percent of project costs be dedicated to maintenance. These changes would streamline the capital planning process, as existing provisions already provide sufficient mechanisms for Borough Presidents to identify needs and advise on capital projects.
Recommendations related to Capital Planning
The Commission should eliminate § 211 of the Charter, which sets aside 5 percent of the capital appropriations over which the City has substantial discretion for the five Borough Presidents.
The Commission should eliminate § 102-a of the Charter, which requires the City’s expense budget to dedicate nine-tenths of 1 percent of the cost of Borough Presidents’ capital projects to their maintenance.
The Commission should amend § 216 and § 249 of the Charter, which refer to the capital budget borough allocation.
The Commission should amend § 82 of the Charter, which requires Borough Presidents to maintain topographical bureaus to assist with capital projects in the borough.
Key Data
5 percent
— of the capital appropriations over which the City has substantial discretion are currently set aside for the five Borough Presidents.
nine-tenths of 1 percent
— of the cost of Borough Presidents’ capital projects is required to be dedicated to their maintenance in the City’s expense budget.
New York's transportation infrastructure faces a significant funding shortfall, leading to deteriorating roads and bridges that require billions in investment to reach a state of good repair. To address this, the state should modernize its revenue streams by implementing congestion pricing, increasing existing user fees, and transitioning to a sustainable mileage-based user fee system.
Recommendations related to Capital Planning
The State should implement congestion pricing in New York City to raise significant transportation revenues and reduce traffic congestion.
New York should adopt a statewide mileage-based user fee, also known as a vehicle-miles traveled (VMT) fee, to more accurately charge motorists for use of the highway system.
The State should increase existing motorist user fees, including fuel taxes, motor vehicle fees, and tolls, to help cover the costs of operating and maintaining the road and bridge network.
The Governor and legislature should develop and advance a comprehensive congestion pricing proposal this year to raise sufficient revenues to reduce transportation funding shortfalls.
New York should shift away from fuel taxes toward a more sustainable VMT fee to ensure long-term funding for the state's highway and transit networks.
Key Data
$3.6 billion
— Annual transportation revenue collected by New York State in fiscal year 2018.
$5.5 billion
— Cost of State of Good Repair (SGR) needs at NYSDOT in 2016.
18.5%
— Share of New York's National Highway System pavement considered 'Rough' or 'Very rough'.
10.5%
— Share of all state, local, and authority bridges in New York that were structurally deficient in 2017.
$1.2 billion
— Potential annual revenue from a statewide vehicle-miles traveled (VMT) fee charged at a rate of 1 cent per mile.
New York City's capital planning process should be improved by expanding the capital inventory to include all assets that meet financing criteria and by focusing the Borough Presidents' roles on identifying needs rather than allocating capital budget funds. Additionally, the city should enhance capital project needs assessments and budget management to ensure greater adherence to current reporting requirements and more rigorous analysis.
Recommendations related to Capital Planning
The Charter should be amended to make the City’s capital inventory and needs assessment more comprehensive; that is, to include all assets that meet capital financing eligibility criteria, currently $35,000 and a five-year useful life, owned by an agency or authority that the City controls.
The Charter should be amended to focus the Borough Presidents’ roles on identifying borough-based needs and advising the Mayor and the City Council on how best to address those needs.
The Charter should be amended to eliminate the capital budget Borough President allocations.
The needs assessment should inventory capital assets, identify their condition, and estimate the investment needed to bring them to or keep them in a state of good repair.
Key Data
$10 million
— The current Charter requires an inventory of fixed capital assets or buildings with a historical cost of at least this amount.
10 years
— The current Charter requires an inventory of fixed capital assets or buildings with a useful life of at least this duration.
$35,000
— The proposed threshold for the comprehensive capital inventory and needs assessment.
5 percent
— The portion of proposed capital budget appropriations currently specified for Borough Presidents, which reduces efficient citywide allocation.
5 years
— The proposed useful life threshold for assets to be included in the comprehensive capital inventory.
The MTA's 10-Point Plan represents a positive step toward addressing the agency's financial and capital needs through congestion pricing and revenue generation. However, the plan requires further clarification regarding the Regional Transportation Committee's oversight role to ensure it does not impede the timely approval of the capital program and necessary fare adjustments.
Recommendations related to Capital Planning
Clarification is needed on the Regional Transportation Committee’s (RTC) role in reviewing the capital program and toll and fare increases required to fund it.
The RTC should not become an obstacle to timely approval of the capital program or fare increases.
Ideally, new internet sales taxes and excise taxes on marijuana should be allocated in the budget process and not 'earmarked' in statute.
Critical to cost containment and management improvement efforts will be the participation of labor and increased productivity by all segments of the workforce.
New York City's annual capital investments have grown significantly, yet tracking project costs and delays remains difficult due to fragmented and limited data. Establishing a comprehensive, accessible online database for all pending construction projects would improve transparency and allow for better oversight of these multi-billion dollar investments.
Recommendations related to Capital Planning
The City of New York should produce an online database of all pending construction projects that includes initial and current completion dates and costs.
The City should use the existing Capital Projects Dashboard as the basic platform for the new database to leverage existing capabilities.
The database should require the inclusion of each project’s associated capital budget lines and project ID codes to allow the database to be linked to budget documents.
The database should retain data on completed projects to allow for retrospective assessment of performance.
The City should require a broader scope of projects, downloadable format, and up-to-date data to improve the quality and accessibility of public information.
Key Data
$7.4 billion
— City capital commitments in fiscal year 2014.
$11.8 billion
— City capital commitments in fiscal year 2018.
$83.8 billion
— Forecasted capital commitments from fiscal years 2019 through 2023.
$25 million
— Threshold for current capital projects included in the existing Capital Projects Dashboard.
$10 billion
— Annual capital commitments by the City.
New York City's transit system requires significant capital investment, with the Fast Forward Plan estimated to cost $40 billion to modernize signals, improve accessibility, and expand the fleet. Previous five-year capital plans grew from $24.1 billion in 2010-2014 to $33.3 billion in 2015-2019, highlighting the escalating financial requirements for maintaining and upgrading subway and bus infrastructure.
Recommendations related to Capital Planning
The Fast Forward Plan prioritizes a modernized signal system on 5 lines during the first 5 years.
The Fast Forward Plan prioritizes a modernized signal system on 6 additional lines during the following 5 years.
The plan includes 50 new accessible stations and 150 rehabilitated stations in the first 5 years.
The plan includes 130 additional accessible stations and 150 rehabilitated stations in the following 5 years.
The plan calls for 1,850 new and modified subway cars and 2,800 new buses in the first 5 years.
The plan calls for 3,000 new subway cars and 2,100 new buses in the following 5 years.
Key Data
$24,118 Million
— Total 2010-2014 5-year capital plan budget.
$33,270 Million
— Total 2015-2019 5-year capital plan budget.
$40 Billion
— Estimated cost of the Fast Forward Plan.
$11,259 Million
— 2019 operating expense for Subway & Buses.
The Preliminary Ten-Year Capital Strategy for Fiscal Years 2020 to 2029 exceeds $100 billion for the first time, reaching a total of $104.1 billion. This represents an 8.7% increase over the previous ten-year strategy, necessitating a thorough assessment of whether these proposed projects are justified by improved service or return on investment.
Key Data
$104.1 billion
— Total value of the Preliminary Ten-Year Capital Strategy for Fiscal Years 2020 to 2029.
8.7%
— Increase in the Preliminary Ten-Year Capital Strategy for Fiscal Years 2020 to 2029 over the prior ten-year strategy.
New York City's Ten-Year Capital Strategy has grown to an unrealistic $95.8 billion, necessitating a shift toward focusing on priority projects and critical infrastructure repairs. To ensure fiscal stability, the City must reduce the funding level of its capital plan and prioritize investments that bring assets to a state of good repair.
Recommendations related to Capital Planning
The City should focus on priority projects and reduce the funding level in the upcoming Ten-Year Capital Strategy.
Capital investment should be focused on projects that bring assets to a state of good repair (SGR), such as roads, bridges, the water and sewer system, and public facilities.
New initiatives should only be included in the capital plan if they can be justified by a clear return on investment.
Key Data
$83.8 billion
— The size of the first Ten-Year Capital Strategy released under Mayor de Blasio.
$95.8 billion
— The size of the second Ten-Year Capital Strategy released under Mayor de Blasio.
New York City's proposed $17 billion Department of Education capital plan faces criticism for relying on new construction rather than operational strategies to address school crowding, which persists despite $40.4 billion in previous investments. The city should shift its focus toward rezoning and better utilizing existing space in elementary schools, where capacity shortages are most acute, rather than continuing to build new facilities.
Recommendations related to Capital Planning
The City should implement operational strategies that alter the use of space and redirect students to facilities with capacity.
The Department of Education should cap enrollment at crowded buildings and implement grade truncations or extensions at the middle and high school levels.
The Department of Education should continue and increase its rezoning efforts to balance enrollment across buildings and shift students from crowded districts into schools with available space.
Programs that attract many out-of-zone applicants, such as bilingual schools and gifted and talented programs, should be sited in underutilized buildings to attract enrollment away from crowded schools.
The proposed five-year capital plan should be revised to focus on elementary schools, where crowding is highest, and to limit new capacity to those neighborhoods where operational strategies are not sufficient to address crowding.
Key Data
$17 billion
— The proposed Department of Education (DOE) Capital Plan for fiscal years 2020-2024.
$8.76 billion
— The amount allocated in the proposed plan to fund 57,000 new K-12 seats and additional pre-K and 3-K capacity.
$9.1 billion
— The amount spent since 2005 to construct more than 98,000 seats as of September 2018.
55,000
— The citywide surplus of seats in DOE school buildings as of the 2016-2017 school year.
21,500
— The shortage of seats in Queens, representing the most acute crowding problem in the city.
57 percent
— The portion of elementary schools that exceed their capacity.
New York State's infrastructure network is aging and failing to meet modern needs, requiring at least $100 billion in new investment to address critical deficiencies. To improve outcomes, the state should establish a centralized Office of Infrastructure to coordinate long-term planning, standardize project prioritization, and explore sustainable funding mechanisms like congestion pricing.
Recommendations related to Capital Planning
Establish an Office of Infrastructure to lead statewide infrastructure planning.
The Office of Infrastructure should articulate a set of criteria to prioritize infrastructure investment, aligned with statewide policy objectives and needs.
Within the Office of Infrastructure, project prioritization and investment must balance often competing goals: maintaining a State of Good Repair of existing assets vs delivering transformative projects that expand capacity and investing in technology that can support future needs of the state like autonomous vehicle infrastructure.
The Office of Infrastructure should be a clearinghouse for project transparency and reporting, providing a single access point for capital infrastructure projects statewide.
The Office of Infrastructure should create a Center of Excellence for state infrastructure investment with the objectives to tackle cost drivers, assess and recommend the most appropriate project delivery, and encourage and facilitate knowledge sharing across entities.
In order to appropriately fund the State’s infrastructure needs, New York will require more funding from its existing funding sources and should pursue alternate funding sources, such as congestion pricing and value capture.
Key Data
$100 billion
— New investment required to meet the state’s infrastructure needs.
50%
— Percentage of the State’s capital spending that infrastructure spending accounts for.
$16.8 billion
— Amount New York State spent on transportation, utilities, and water and waste management in 2018.
$68 billion
— Investment estimated by ASCE that the MTA would require over the next 20 years to update and maintain the system.
$4.7 billion
— Investment estimated by ASCE needed in the three NYC area airports.
$21 billion
— Amount the Resiliency Finance Corporation could raise over 20 years.
The Amazon headquarters deal in Long Island City involves $2.8 billion in state and city incentives, which could rise to $3.5 billion if job and office space targets are met. Future economic development deals should prioritize investing capital funding in general infrastructure through the regular budgetary process rather than providing direct benefits to individual companies.
Recommendations related to Capital Planning
State capital funding is best invested in general infrastructure, not for the direct benefit of an individual company.
Capital investment should go through the regular budgetary process.
Capital investment in growing areas of the city should be considered alongside citywide needs.
Key Data
$2.8 billion
— Total state and city benefits offered to Amazon for the Long Island City headquarters project.
$3.5 billion
— Potential combined state and city incentives if Amazon creates 40,000 jobs and 8 million square feet of office space.
$1.5 billion
— New York State tax breaks and grants offered to enable the Amazon investment.
$1.3 billion
— New York City benefits offered to enable the Amazon investment.
The Amazon HQ2 deal in Long Island City involves up to $2.8 billion in state and city incentives, including tax credits and capital grants, contingent on job creation and investment targets. This agreement highlights the need for reforms in economic development policy, specifically regarding the use of discretionary capital grants, the circumvention of oversight in funding streams, and the necessity of subjecting infrastructure investments to the regular budgetary process.
Recommendations related to Capital Planning
The state should ensure that Excelsior Job Program benefits are not expanded to accommodate the needs of a single company by exceeding current caps and expiration dates.
Caps to the level of wages eligible for reimbursement would minimize the State’s financial exposure regarding the Excelsior jobs program wage credit.
State capital funding is best invested in general infrastructure, not for the direct benefit of an individual company, and funding streams should not circumvent oversight.
Amazon should pay the full value of the PILOT directly to the City rather than diverting some funds to the surrounding neighborhood.
New York City’s as-of-right tax incentives should be evaluated and potentially narrowed or eliminated to ensure benefits are only spent to induce job creation that would not otherwise occur.
Key Data
$2.5 billion
— Amount Amazon committed to investing in the HQ2 project.
$1.7 billion
— Benefits provided by New York State to Amazon.
$1.8 billion
— Benefits provided by New York City to Amazon.
$1.2 billion
— Maximum Excelsior tax credits Amazon could receive over the 2019-2028 period.
$505 million
— Maximum total of the Empire State Development capital grant.
$386 million
— Estimated total of the ICAP property tax abatement.
The New York City Housing Authority faces $32 billion in capital needs, with nearly all properties requiring substantial rehabilitation at an average cost of $181,000 per unit. Without significant intervention, 90 percent of the 176,000 public housing units risk becoming too deteriorated to repair by 2027.
Recommendations related to Capital Planning
The City should fully integrate NYCHA into its affordable housing strategy to shift unit distribution and funding to preserve units for extremely and very low-income households.
NYCHA should transition from being a landlord to an affordable housing steward that manages fewer buildings by utilizing public-private partnerships and transferring senior housing to nonprofit developers.
NYCHA should leverage underutilized land assets to fund repairs and facilitate development by selling air rights or allowing infill development.
NYCHA should improve operations and construction management by modernizing property management standards, increasing private maintenance contracts, and utilizing design-build methods.
Key Data
$32 billion
— Total capital needs for the New York City Housing Authority.
$181,000
— Average cost per unit for substantial rehabilitation of properties.
90 percent
— Portion of NYCHA’s 176,000 units that could deteriorate to the point of being no longer cost-effective to repair by 2027.
$1.5 billion
— Potential funding raised by selling 10 percent of NYCHA’s air rights.
58 million
— Square feet of development rights controlled by NYCHA across the city.
$300 million to $600 million
— Goal set by NextGen NYCHA for raising funds from mixed income infill development.
New York State's capital spending is projected to reach $14.5 billion in fiscal year 2019, nearly doubling from $7.8 billion in fiscal year 2011. This increase is largely supported by authority bonds and State pay-as-you-go funds, which have more than doubled over the same period.
Key Data
$14.5 billion
— Projected capital spending in fiscal year 2019, up from $7.8 billion in fiscal year 2011.
$7.6 billion
— Projected capital spending funded by authority bonds in fiscal year 2019, representing 50.4 percent of the total.
$4.4 billion
— Projected State pay-as-you-go sources for capital spending in fiscal year 2019, more than double the $2.1 billion in fiscal year 2011.
$66.7 billion
— State debt outstanding as of fiscal year 2011, an 8 percent increase from $61.7 billion.
New York City's reliance on borrowing to fund capital projects has led to record levels of bonded debt, with projections indicating debt outstanding will reach $135.8 billion by fiscal year 2022. To ensure long-term fiscal stability, the City should implement a more realistic capital plan that prioritizes critical infrastructure and utilizes current year resources for pay-as-you-go funding rather than relying exclusively on debt.
Recommendations related to Capital Planning
New bonded debt should be limited by implementing a more realistic capital plan developed around specific priorities and predominantly focused on repairing critical infrastructure, ensuring safety, and expanding where investments make economic sense or can improve critical services.
The City should use the dedicated $250 million capital reserve funds as PAYGO capital to reduce the borrowing needed each year to finance the capital plan.
Key Data
$135.8 billion
— Projected debt outstanding by fiscal year 2022.
$59.3 billion
— Projected City-funded capital commitments between fiscal years 2019 to 2022.
$30.4 billion
— City funds committed to capital projects between fiscal years 2014 and 2017.
$9.9 billion
— Capital commitments in fiscal year 2017.
$5.7 billion
— Capital commitments in fiscal year 2014.
$250 million
— Dedicated capital reserve in the operating budget intended as a hedge against rising debt service costs.
$31.8 billion is the amount required to repair NYCHA's public housing units over the next five years. CBC Senior Research Associate Sean Campion discuss the findings and recommendations of CBC's recent report on NYCHA's capital needs and explains how NYCHA got into such a deep hole and and how it…
New York City's subway fleet requires significant capital investment to restore reliability, as past deferred maintenance and reduced replacement schedules have led to a decline in performance. To return the system to a state of good repair, leadership must prioritize and secure funding for the multi-billion dollar modernization plan in upcoming capital programs.
Recommendations related to Capital Planning
MTA leadership must increase significantly its commitment to subway cars in the 2020-2024 capital program to return car reliability to its previous highpoint.
The Fast Forward plan must be funded in future capital plans and administered effectively to achieve anticipated results and restore the fleet to a state of good repair.
The MTA must prioritize subway car investments over other competing projects to avoid placing added pressure on the fleet’s maintenance and squandering hard-fought gains in reliability.
Key Data
$9 billion
— Estimated cost relating to subway cars.
$8.3 billion
— Combined cost of R211s and additional cars.
$1.2 billion
— Amount authorized in the current capital plan.
$2.7 million
— Average cost per car for the base order of 460 R211s.
New York City's capital construction projects, which are supported by an $82 billion commitment plan, rely on Project Labor Agreements that have not been independently evaluated for their promised savings or effectiveness. To ensure cost-efficiency and productivity, the City should conduct transparent, independent reviews of these agreements and explore additional strategies to mitigate the impact of rising construction inflation.
Recommendations related to Capital Planning
The City should commission evaluations of the four expiring Project Labor Agreements while there is still time to decide if it is in the City’s interest to amend or renew them.
Decisions regarding the future of Project Labor Agreements should be made with transparency and be based on a detailed, independent analysis of performance and experience.
The Mayor’s Office of Contract Services should identify and evaluate other City efforts to boost construction productivity.
Key Data
$347 million
— Projected savings from Project Labor Agreements on $8 billion in construction work.
$8 billion
— Total value of construction work covered by the projected savings of the Project Labor Agreements.
$82 billion
— Total value of the current Capital Commitment Plan.
4 to 5 percent
— Average annual rate of construction inflation since the City signed the four Project Labor Agreements.
The New York City Housing Authority faces a $32 billion capital needs crisis, with 90 percent of its housing units at risk of becoming too deteriorated to repair by 2027. To address this, the authority must integrate into the city's broader affordable housing strategy, leverage underutilized land assets, and transition to a model that manages fewer buildings while improving operational efficiency.
Recommendations related to Capital Planning
Providing NYCHA with one-third of the City’s planned capital commitments for affordable housing over the next five years would give NYCHA an additional $1 billion through fiscal year 2022.
Increasing the pace of public-private partnerships to convert public housing units to the more stable Section 8 funding stream will deliver immediate benefits to residents and address more than $2 billion in capital needs through 2022.
NYCHA should reduce the number of units it operates by transferring senior housing to qualified nonprofit organizations and sell its small, inefficient buildings with fewer than 200 units.
Selling 10 percent of NYCHA’s air rights could raise $1.5 billion.
Accelerating the pace of infill development to build an additional 10,000 units could raise an additional $1.4 billion—provided the units are market rate and mixed income.
NYCHA should decentralize property management, modernize its collective bargaining agreements and staffing structures, increase the use of private maintenance contracts, and work with the City and State to use more flexible procurement arrangements.
Key Data
$32 billion
— The amount of capital needs quantified for NYCHA over the next five years.
90 percent
— The portion of NYCHA’s housing units at risk of deteriorating past the point at which they are cost-effective to repair by 2027.
31 percent
— The amount of capital need covered by funding during the 2007-2011 period.
11 percent
— The amount of capital need covered by funding during the 2012-2017 period.
39 percent
— The amount by which NYCHA’s costs of operations are higher than those of other landlords operating rent-stabilized buildings.
58 million
— The number of square feet of additional development as-of-right that NYCHA’s campuses could accommodate.
NYCHA faces $32 billion in capital needs over the next five years, with 90% of its housing units at risk of becoming irreparable by 2027 without significant intervention. To address this, the agency must transition to an affordable housing steward model, leverage underutilized assets like air rights, and increase the use of public-private partnerships to secure necessary funding and operational improvements.
Recommendations related to Capital Planning
Radical changes need to be undertaken immediately to address NYCHA’s $32 billion in capital needs over the next five years.
NYCHA should transition to an affordable housing steward employing a full range of strategies.
NYCHA must tap its underutilized assets, including air rights and potential infill development, and adopt best operational practices in procurement and building maintenance.
Improving and managing developments will require greater use of public-private partnerships, significant management reforms, and partnership with federal, state, local, tenant, and labor stakeholders.
Key Data
$32 billion
— NYCHA’s capital needs over the next five years.
$8 billion
— Capital investment planned over the next five years.
90%
— NYCHA housing units at risk of no longer being cost-effective to repair by 2027.
$7 billion
— Additional combined savings and new revenue identified to slow deterioration and improve sustainability over the next five years.
New York City's capital plan has grown by 87.5 percent since 2015, reaching $65.1 billion for fiscal years 2019 to 2022, which raises concerns about the city's ability to implement projects cost-effectively. To manage these rising costs and long-term liabilities, the city should prioritize state-of-good-repair projects and shift toward using current resources as "pay-go capital" rather than relying on borrowing.
Recommendations related to Capital Planning
The Capital Plan should be reduced and refocused on strategic priorities that emphasize state of good repair and maximize the return on investment for new projects.
The City should use current resources as “pay-go capital,” instead of borrowing, to allow the City to invest in its infrastructure without increasing long-term liabilities.
Key Data
$65.1 billion
— Projected capital spending for fiscal years 2019 to 2022.
87.5 percent
— The increase in the capital plan from the fiscal year 2015 executive financial plan.
$7.0 billion
— Debt service budgeted for fiscal year 2019.
11.6 percent
— Debt service as a percentage of tax revenue in fiscal year 2019.
$1 billion
— Capital spending added for fiscal years 2019 to 2022 under the federal consent decree for the New York City Housing Authority.
$600 million
— Additional capital spending added in the Adopted Budget for cultural institutions, libraries, school accessibility, and 3-K seats.
The MTA's 'Fast Forward' plan offers a promising approach to modernizing the transit network, particularly through the accelerated installation of subway signals to improve reliability and capacity. To ensure long-term success, the agency should prioritize a state of good repair for all infrastructure components and consider transitioning to a ten-year capital planning cycle revised every five years.
Recommendations related to Capital Planning
The Metropolitan Transportation Authority should explicitly relate the measures identified to progress toward achieving a state of good repair for all system components including stations, track, and line equipment.
The Metropolitan Transportation Authority should give equal attention to the more hidden elements of the system that are vital to reliability and safety.
The Metropolitan Transportation Authority should move from the current system of five-year capital plans to a ten-year capital plan that is revised every five years.
The five-year capital commitment plan has grown to approximately $82 billion, necessitating that additions to the plan receive the same level of scrutiny as the operating budget. Reforms to the city's capital planning and budgeting processes are essential and should be integrated into the approval process for the capital commitment plan.
Recommendations related to Capital Planning
Additions to the capital plan should be treated with the same caution and scrutiny as those to the operating budget.
Reforms to the city’s capital planning and budgeting processes should be part of the approval process for the capital commitment plan.
Key Data
$82 billion
— The size of the five-year capital commitment plan.
The New York State Fiscal Year 2019 Enacted Budget and prior state policies require New York City to fund nearly $1 billion in additional operating and capital expenditures. This financial burden includes $214 million in new capital spending for projects such as the MTA Subway Action Plan and the Hudson River Park, forcing the City to adjust its financial plan and exercise fiscal restraint.
Key Data
$214 million
— The total amount of capital spending the City of New York must fund next year due to the New York State Fiscal Year 2019 Enacted Budget.
$164 million
— The portion of the MTA Subway Action Plan that the City must fund as capital expenditures.
$50 million
— The amount the City is called on to provide toward the completion of the Hudson River Park, which will be reflected in the City’s capital budget.
New York City's capital commitment plan is currently too large and unrealistic, obscuring priorities and hindering accountability for project completion. To improve efficiency, the city should implement rigorous needs assessments, adopt life-cycle cost analysis, and pursue procurement reforms like design-build to better manage infrastructure investments.
Recommendations related to Capital Planning
The Preliminary Capital Commitment Plan and the Ten-Year Strategy that guides it are too large and should be treated with the same caution and scrutiny as adding to the operating budget.
The capital plan should reflect more accurately the timing of the City’s capital projects to improve project coordination, budgeting, and monitoring.
The Asset Management Information System should incorporate thorough needs assessments, include a broader set of capital assets, and align more closely with the capital plan.
The capital planning process should include a life-cycle cost analysis that incorporates the cost of operating, maintaining, and ultimately replacing capital assets.
Indicators such as per-unit costs or benchmarks to measure progress toward project milestones should be included with the capital budget or added to the Mayor’s Management Report.
Identifying and addressing the root causes of coordination issues, outdated procurement rules, and inadequate project oversight would help contain spending growth and speed up project delivery.
City agencies should replace lump sum project codes, which offer little transparency, with codes that clearly define projects.
Greater data on actual capital spending would facilitate oversight and accountability by allowing observers to monitor the progress and total cost of individual projects.
The administration and City Council should work with the State Legislature to enact procurement reforms, including the ability to use design-build and the repeal of Wicks Law.
The City’s costs of borrowing are expected to increase and should be offset by the use of pay-go financing.
Key Data
$79 billion
— The size of the Preliminary Capital Commitment Plan for Fiscal Years 2018 to 2022.
New York City’s capital commitment plans are consistently front-loaded and overly ambitious, resulting in a significant buildup of unspent funds and projects that are often delayed or over budget. To improve transparency and management, the City must align its capital plans with realistic agency capacity and clearly defined priorities.
Recommendations related to Capital Planning
The City should reduce the size of the capital commitment plan to force agencies to identify their capital priorities.
The commitment plan should reflect what agencies can reasonably commit and manage in a given year.
Reducing the size of the plan will prevent the buildup of excess appropriations and allow for better oversight of capital expenditures.
Eliminating the front-loading of planned commitments will allow for more accurate timing of future commitments.
Key Data
$69.6 billion
— Total capital commitments planned from fiscal year 2018 through fiscal year 2021.
$21.7 billion
— Amount of capital commitments planned for the first year of the 2019 plan.
$1.7 billion
— Amount by which the current commitment plan exceeds the plan proposed one year prior.
$15.7 billion
— The commitment target for 2018 in the current Preliminary Capital Commitment Plan.
$6.0 billion
— The reserve for unattained commitments in the 2018 plan, representing 28 percent of the target.
54 percent
— The share of planned commitments the City actually committed in fiscal year 2017.
$32.2 billion is the size of the 2017-2026 Capital Plan of the Port Authority of NY and NJ. This podcast features Port Authority Executive Director Rick Cotton, followed by a discussion on public-private partnerships, airport renovations, the fate of Gateway, and the 42nd Street bus terminal.
New York City's Preliminary Budget for Fiscal Year 2019 fails to address potential federal tax law impacts or budget cuts, while neglecting to add to city reserves. The budget also lacks necessary reforms to the capital plan, such as "right-sizing" and "right-timing," and allows spending growth to continue outpacing inflation.
Recommendations related to Capital Planning
The City should adapt the capital plan to a resource constrained environment.
The City should reform the capital plan through "right-sizing" and "right-timing".
New York City's capital planning requires a more rigorous framework that prioritizes "state of good repair" projects over new expansions to manage the city's high debt burden. By implementing comprehensive needs assessments, adopting a "fix it first" strategy, and reforming contracting rules, the city can improve asset management and ensure more cost-effective infrastructure investment.
Recommendations related to Capital Planning
The next administration should enact clear guidelines or directives for performing routine maintenance and regular replacement of assets.
All city agencies and component units should undertake a comprehensive needs assessment that details the condition of major asset classes and the cost to fix those in disrepair.
The needs assessment should be used to develop a plan to achieve state of good repair.
The administration should publish easy-to-read progress reports that describe what the capital program accomplished in that year relative to state of good repair goals.
The next administration should articulate a standard for keeping debt from becoming unaffordable.
The administration should develop criteria for paying for some capital expenses from the operating budget.
The City should adopt a “fix it first” strategy, in which state of good repair projects receive priority at each agency.
The City should renew its Project Labor Agreements to reduce labor costs and improve managerial flexibility.
City leaders should advocate for changes to contracting rules that increase costs and impede efficient construction management, such as a repeal of Wicks Law.
Key Data
$100 billion
— Total debt outstanding for the City of New York.
$123 billion
— Total index-adjusted capital spending under Mayor Bloomberg.
$53.7 billion
— Total capital commitments outlined in the final Ten-Year Capital Strategy.
$24.5 billion
— Amount of the final Ten-Year Capital Strategy devoted to state of good repair.
$300 million
— Estimated capital budget savings over four years from Project Labor Agreements.
$3.2 billion
— Projected cost of the Croton Filtration Plant.
NYCHA faces a massive and growing capital funding gap, with projected needs exceeding $25 billion while its aging housing stock—84 percent of which was built before 1970—continues to deteriorate. To address this shortfall, the authority has increasingly relied on alternative strategies like public-private partnerships and rental voucher conversions to secure necessary funding for repairs.
Key Data
$25 billion
— Likely capital needs in the forthcoming Physical Needs Assessment, which dwarf available resources.
$16.5 billion
— Total cost of bringing the system to a state of good repair identified in the 2011 Physical Needs Assessment.
84 percent
— Portion of NYCHA housing stock built before 1970, contributing to the system's aging condition.
$3 billion
— Estimated damage caused to the NYCHA system by Superstorm Sandy in 2012.
$1.7 billion
— Total amount spent on capital improvements between 2012 and 2016, which met only 10 percent of the identified need.
$253 million
— Funds raised through tax-exempt bonds and LIHTC equity for the Ocean Bay development rehabilitation.
Tax increment financing allows municipalities to fund infrastructure projects by capturing future property tax revenue, but it carries significant risks if projects are not properly vetted. To protect taxpayers, governments must conduct rigorous due diligence, including "but for" analyses and stress testing revenue projections, to ensure these projects are financially viable and truly necessary.
Recommendations related to Capital Planning
Governments should determine if the project passes the "but for" test to ensure development would not occur without the TIF-funded capital project.
Governments should evaluate whether the investment will generate new economic activity or simply shift it from elsewhere.
Governments should assess if the project’s expected return on investment is strong enough to justify diverting revenue from other uses.
Governments should test revenue projections against a range of economic scenarios to ensure the district will generate sufficient revenue to repay debt service and other costs.
Governments should consider whether general obligation bonds are a better, less risky option than TIF bonds.
Governments should implement strong transparency provisions to protect future taxpayers against the risks associated with TIF projects.
Key Data
$3 billion
— The projected cost of the Hudson Yards project based on the planning study.
138-acre
— The size of the contaminated industrial property in Atlanta that was remediated for the Atlantic Station TIF project.
$10 million
— The amount that a majority of Chicago's TIF districts raised and spent over a 13-year period.
$359 million
— The amount New York City paid from its general fund to subsidize Hudson Yards’ interest payments.
$266 million
— The amount in capital cost overruns for the Hudson Yards project.
$14 million
— The amount of TIF debt the Troy Downtown Development Authority in Michigan defaulted on.
New York State's transportation capital planning process lacks a cohesive, data-driven strategy, often relying on disjointed documents and political negotiations rather than objective needs assessments. To improve transparency and accountability, the state should codify a formal, multi-year planning process that links asset conditions to specific funding goals and project lists.
Recommendations related to Capital Planning
State officials should codify in statute a process to formally set forth appropriate capital planning procedures for DOT assets.
The State should produce an update of the DOT’s capital program’s strategies and goals to outline the system's vision over the upcoming five-year period.
The State should conduct a needs assessment highlighting the condition of the assets, and the projected costs associated with maintaining these assets and making other improvements.
The State should publish a proposed project list, with funding identified, which will accompany the Governor’s proposed budget to help elected officials negotiate funding levels.
The State should produce an enacted capital plan and project list for DOT projects including all costs contained in the State’s enacted Financial Plan.
The DOT should reproduce its list of projects annually with each Executive Budget to enable the Legislature, relevant stakeholders, and the public to track projects.
The DOT should issue a status report on projects included in the enacted five-year capital plan to update the status of projects and compare progress relative to original goals.
Key Data
$4.9 billion
— Annual disbursements for the New York State Department of Transportation's capital expenses.
36 percent
— Portion of projected capital spending by New York State agencies represented by DOT capital expenses.
$1.5 billion
— Amount allocated to Long Island roads and bridges in the current capital plan.
$1.2 billion
— Combined amount allocated to the North Country, Mohawk Valley, and Central New York regions in the current capital plan.
$21 billion
— Total funding available for the 2016 through 2020 capital program.
$6.5 billion
— Amount of funding from the 2016 through 2020 capital program that was left out of project lists entirely.
This week's data point is $17 billion - the capital needs for rehabilitating the nation's largest housing authority. NYCHA Chair and CEO Shola Olatoye joins the podcast to discuss strategies for addressing these capital needs and to review progress implementing NextGenNYCHA, its strategic plan.
The Metropolitan Transportation Authority's Enhanced Station Initiative prioritizes aesthetic and technological upgrades at 32 subway stations, costing significantly more than standard renewal projects while diverting funds from critical infrastructure needs. Given the system's declining performance and state of emergency, the agency should reevaluate whether these costly enhancements are a better use of limited capital funds than essential signal and structural repairs.
Recommendations related to Capital Planning
As part of the MTA’s 60-day review, the question of whether the enhancement of 32 stations is worth the trade-off against other capital needs should be reexamined.
The MTA must consider whether future riders will be better off and more satisfied waiting out the delays at enhanced stations as it reviews its capital program to address the current state of emergency.
Key Data
$921 million
— Total funding allocated for the Enhanced Station Initiative in the 2015-2019 capital program.
$37 million
— Average cost per station for Enhanced Station Initiative projects.
$22 million
— Average cost per station for renewal projects not part of the Enhanced Station Initiative.
$4 billion
— Total funding for subway station projects in the 2015-2019 capital plan following the May 2017 amendment.
$40 million vs $16 million
— Cost comparison for the four stations in Package 2 as Enhanced Station Initiative projects versus their previously budgeted cost as non-Enhanced Station Initiative projects.
This week's data point is 30 days - the period in which MTA New York City Transit will conduct a "top-to-bottom" review to identify changes necessary to improve its performance. CBC's Director of Infrastructure Studies Jamison Dague discusses underinvestment and how resources are being directed in the capital plan with…
This week's data point is $32.5 billion - the value of Metropolitan Transportation Authority's (MTA's) capital plan for 2015 to 2019. Special guest MTA Chief Development Officer Janno Lieber discusses the MTA's capital priorities and how the authority can improve management of its mega-projects.
New York City has added $1.9 billion in capital funding to its ten-year affordable housing plan, yet the official budget documents lack necessary details on program allocation and productivity benchmarks. Without transparent financial reporting on spending and unit costs, it remains difficult to evaluate whether the plan is deploying capital in the most cost-effective way.
Recommendations related to Capital Planning
The City should provide more details on which programs or projects will receive the new funding, or how it will be used to enhance different levels of affordability.
The City should include productivity benchmarks in the Ten-Year Capital Strategy to make it easier to estimate how many units will be financed and at what cost per unit.
The City should provide an update on how much it has spent to date and how much it will need to spend to reach its goal by 2024.
The City should include information on which affordable housing programs each project used, or the value of City, State, and federal subsidies provided to each project in its project database.
Key Data
$1.9 billion
— Additional capital funding added to the ten-year affordable housing plan in the Fiscal Year 2018 Executive Budget.
$41 billion
— Total public and private funds expected to be spent over 10 years to build or preserve 200,000 affordable units.
$6.7 billion
— Total City capital funding allocated for the ten-year affordable housing plan.
62,506
— Number of affordable units financed through the end of 2016.
200,000
— Total number of planned units in the ten-year affordable housing plan.
$5.6 billion
— Total planned housing commitments in the Ten-Year Capital Strategy.
The Metropolitan Transportation Authority faces significant challenges in maintaining and modernizing its infrastructure, with current funding for New York City Transit falling short of the levels identified in the agency's 20-year needs assessment. Despite having over $110 billion in approved capital investments across recent plans, billions remain unspent or uncommitted, necessitating a more transparent and accelerated approach to capital project management.
Recommendations related to Capital Planning
Leaders should prioritize those investments needed to restore the system and enhance capacity in the most cost-effective manner as the MTA reevaluates the current capital program and looks to the 2020-2024 plan.
A more transparent process should be pursued so that the public may hold the board responsible for distributing limited capital dollars wisely.
To modernize the system, capital investments should be accelerated to the maximum extent possible.
Key Data
$110 billion
— in approved capital investments included in the 2015-2019 capital plan and the three previous plans as of March 2017.
$64 billion
— spent of the $110 billion in approved capital investments as of March 2017.
$13 billion
— committed but remains unspent of the $110 billion in approved capital investments as of March 2017.
$33 billion
— authorized but remains uncommitted of the $110 billion in approved capital investments as of March 2017.
$17 billion
— in unspent funds from previous capital plans, representing more than one-fifth of previously approved investments.
The Metropolitan Transportation Authority's revised capital plan prioritizes expensive expansion projects like the Long Island Rail Road expansion and the Second Avenue Subway over critical maintenance and modernization needs, such as signal upgrades. This allocation of resources fails to address the root causes of service deterioration and declining reliability across the transit system.
Recommendations related to Capital Planning
Future amendments can still reprioritize funds for more appropriate state of good repair work and for the modernization of the subway’s aging signal system.
The board should require more transparency of changes to the capital program.
The board should emphasize what the agency can accomplish if capital funds are spent on state of good repair projects, existing system improvements, or both.
Board members and the public must remain engaged in the MTA’s capital planning process to ensure the region does not squander another opportunity to reinvest.
Key Data
$29.5 billion
— Total value of the current five-year capital plan following the addition of $2.8 billion in investments.
$20 billion
— Estimated size of the transit system's continuing needs in 2017 dollars.
$2 billion
— New capital commitments added for the Long Island Rail Road Expansion Project.
$700 million
— New capital commitments added for Phase II of the Second Avenue Subway.
10 percent
— Amount by which the comprehensive amendment increased the size of the capital plan above the originally-approved $26.6 billion.
$12.4 billion
— Reduced total state of good repair and normal replacement commitments following the recent amendment.
New York City's capital planning process requires significant improvements, as current strategies often underfund later years and lack realistic scheduling for infrastructure projects. Additionally, the city needs to better assess capital needs, including the resources required to bring infrastructure to a state of good repair, while implementing comprehensive metrics to track performance and progress.
Recommendations related to Capital Planning
The city should improve the capital planning process.
The city should ensure realistic timing for the capital plan by addressing the underfunding in the latter years of the Capital Strategy.
The city should include a better assessment of capital needs and implement metrics to assess performance within the capital planning process.
The city should incorporate programmatic indicators into the Capital Strategy to effectively measure progress.
The city should enhance the Asset Information Management System (AIMS) to be sufficiently comprehensive to evaluate funding progress.
Key Data
80%
— Share of planned ten-year capital spending allocated to the first four years of the plan for street reconstruction.
86%
— Share of planned ten-year capital spending allocated to the first four years of the plan for parks, playground, and recreational facilities.
92%
— Share of planned ten-year capital spending allocated to the first four years of the plan for police facilities.
92%
— Share of planned ten-year capital spending allocated to the first four years of the plan for sanitation garages and facilities.
The School Construction Authority's $15.5 billion five-year capital plan should be adjusted to better address school overcrowding by maximizing existing space and prioritizing new construction in areas with the highest need. Currently, the plan allocates significant funding to districts with declining enrollment while failing to fully utilize available capacity in other areas.
Recommendations related to Capital Planning
The School Construction Authority should maximize the use of existing capacity to alleviate crowding both within and across districts.
The city should target new capacity to areas with the highest need rather than constructing new capacity where it is less needed.
Steps should be taken to match student enrollment to space across districts’ buildings in the 21 districts that currently have available capacity.
Significant reductions in crowding could be achieved by shifting students to different schools or moving schools to different buildings.
The city should alter school zone boundaries to save on unnecessary capital expenditure, even though it is often politically difficult.
Key Data
$15.5 billion
— Total School Construction Authority five-year capital plan for fiscal years 2015 to 2019.
104,717
— Number of students over capacity in 785 overcrowded public school buildings.
46,000
— Total seats of extra capacity available citywide.
$251 million
— Cost to fund more than 2,500 new seats in District 13, where enrollment is projected to drop by 44 percent.
52 percent
— Share of new seats allocated to the 8 over-capacity districts projected to grow further.
25 percent
— Share of seats in the capital plan located in 9 districts that are currently under capacity and projected to decline in enrollment.
New York City's Ten-Year Capital Strategy, while useful for identifying priorities, suffers from unrealistic timelines that front-load spending and lacks clear programmatic indicators to measure progress toward infrastructure goals. The plan also fails to adequately link capital investments to documented infrastructure needs, making it difficult for the public to assess whether the city is effectively maintaining its assets.
Recommendations related to Capital Planning
The City should align planned commitments with its ability to execute projects to avoid building up excess appropriations.
The Administration should incorporate rebalancing of capital allocations in future capital strategies to reflect realistic spending timelines.
The Strategy should clearly relate back to statements of needs so that the City and the public can determine whether or not planned capital investment is adequate.
The Strategy should include other benchmarks to measure progress toward the project’s completion for spending categories that do not lend themselves to unit cost comparison.
The City should include programmatic indicators for future years in the Strategy to improve accountability.
Key Data
$95.8 billion
— Total planned commitments in the Executive Ten-Year Capital Strategy for Fiscal Years 2018-2027.
14 percent
— Increase in planned commitments in the 2018-2027 Strategy over the fiscal year 2016 version.
$51 billion
— Amount dedicated to keeping assets in a state of good repair.
$20.7 billion
— Expected capital commitments in fiscal year 2018.
145 percent
— Increase in fiscal year 2018 commitments over fiscal year 2016 actual commitments.
$1.8 billion
— Outstanding need for state of good repair funding.
The NYS FY2018 budget allocates billions in capital funds without a transparent planning process, favoring ad hoc projects over strategic investment. Furthermore, the budget fails to extend design-build authorization to New York City and state government, missing an opportunity to achieve significant cost savings on infrastructure projects.
Recommendations related to Capital Planning
The state should allocate capital funds through a meaningful planning process rather than dedicating them to ad hoc projects and questionable investments.
The state should extend design-build authorization to New York City and for State government to yield considerable savings.
New York City's capital construction process for libraries and cultural institutions is plagued by excessive delays and high costs, with projects often taking years to complete and costing significantly more than similar private-sector projects. The current system, characterized by fragmented oversight and inefficient procurement, requires fundamental reform to improve accountability and streamline project delivery.
Recommendations related to Capital Planning
Create a task force to review and reform the capital construction process.
Start systematically tracking capital project costs and timelines.
Streamline project approval practices and reduce redundancies between OMB and DDC.
Simplify the design review process at DDC.
Strengthen DDC’s data analytics team to inform smarter decision-making.
Institute a process for nonprofits to prequalify for discretionary capital funds.
Establish dependable funding for capital construction projects, including routine state-of-good-repair investments.
Standardize and disseminate capital eligibility rules and requirements.
Allow appropriate capital projects to be contracted through a design-build process.
Expand the use of pass-through project management.
Key Data
$930
— Median cost per square foot for new library and cultural buildings in the sample.
1,550
— Median number of days for a project to complete.
2,467
— Median number of days for new construction projects to complete.
$1,272
— Average cost per square foot for ground-up construction projects managed by the city.
$641
— Average cost per square foot for ground-up construction projects managed by the New York Public Library.
5.3
— Average number of Certificates to Proceed (CP) and CP amendments per project.
Transportation capital planning should be based on objective assessments of infrastructure needs and asset conditions rather than arbitrary parity guidelines between mass transit and road projects. Future budget processes should prioritize data-driven analysis of system performance and repair requirements to determine funding allocations effectively.
Recommendations related to Capital Planning
The scale and content of each capital program should be rooted in an objective assessment of needs relating current asset conditions to a desired state of good repair and identifying priorities for system enhancements based on a comparison of projected performance indicators for prospective projects.
The MTA’s 20-year needs assessments and the DOT’s Transportation Asset Management Plan are useful starting points for constructing capital plans and should be enhanced and better utilized in future budget processes.
Political judgment is appropriate in making the hard choices among repair needs and improvements, but these judgments should be informed by careful and professional analysis.
Key Data
$29.5 billion
— Total value of the MTA capital plan covering the five calendar years from 2015 through 2019.
$21.2 billion
— Total spending for the DOT capital program covering five state fiscal years from 2016 through 2020.
29%
— Portion of regional bridge and highway projects in the 2016-2020 DOT plan that will be located in New York City.
60%
— Portion of regional bridge and highway projects in the 2016-2020 DOT plan that will be located in the MTA service region, including New York City, Long Island, and the mid-Hudson counties.
1,956
— Total number of bridges classified as structurally deficient and in need of serious repair across New York State.
71%
— Percentage of statewide travel on transit that occurs within New York City.
The Port Authority's $32 billion, 10-year capital plan lacks a comprehensive needs assessment for facility repairs and clear criteria for prioritizing expansion projects, leading to potential inefficiencies. Furthermore, the agency's reliance on bi-state parity to divide resources between New York and New Jersey projects often ignores regional benefits and undermines strategic infrastructure investment.
Recommendations related to Capital Planning
The agency should develop a publicly-available needs assessment that identifies spending necessary to bring facilities to a state of good repair.
The agency should establish a set of criteria for selecting enhancement and expansion projects that includes benefit-to-cost analyses.
The agency should discard the use of bi-state parity to allocate capital resources between “New Jersey” projects and “New York” projects.
Key Data
$32 billion
— Total value of the Port Authority's 10-year capital plan for the 2017 to 2026 period.
$3.9 billion
— Estimated shortfall in state of good repair (SGR) work, representing a 30 percent gap in necessary maintenance funding.
$11.3 billion
— Amount of pay-as-you-go capital investment, accounting for 35 percent of the total plan.
$3.5 billion
— Cash disbursements allocated for the beginning replacement of the Bus Terminal through 2026.
$1.7 billion
— Cost of the proposed PATH extension to the Newark AirTrain, a project criticized for having dubious benefits.
$377 million
— Additional funds added to the capital program to rehabilitate the current, obsolete AirTrain while a replacement is designed.
New York State's fiscal strategy to limit annual spending growth to 2 percent relies on $1.2 billion in accounting maneuvers, including shifting workforce costs into the capital budget and delaying debt repayments. These practices obscure the true growth rate of state spending, which would otherwise reach 3.2 percent, and undermine budget transparency.
Recommendations related to Capital Planning
The State should cease shifting workforce costs to the capital budget to artificially lower operating budget growth.
The State should avoid delaying repayments to the New York Power Authority to meet short-term spending targets.
The State should refrain from using fiscal gimmicks that make the budget more complicated and undermine transparency.
The State should avoid including placeholders for unspecified “agency financial management” gains in the budget.
The State should stop converting tax exemptions to tax credits solely to reduce the appearance of state spending.
Key Data
$1.2 billion
— Total value of fiscal gimmicks included in the Executive Budget proposal to shift funds, delay costs, or assume unspecified savings.
$227 million
— Savings yielded in the Fiscal Year 2018 Executive Budget by shifting the costs of more than 3,000 employees to Capital Projects Funds.
$277 million
— Amount of STAR benefit disbursements 'saved' by the State through the conversion of property tax exemptions to Personal Income Tax credits.
$500 million
— Annual savings proposed in the Executive Budget to be achieved by Executive agencies, for which specific measures have yet to be identified.
$193 million
— Savings in fiscal year 2018 generated by amending scheduled repayments to the New York Power Authority.
3.2%
— Projected growth of State Operating Funds spending in fiscal year 2018 absent the use of fiscal gimmicks.
The New York City Housing Authority faces $17 billion in unmet capital needs, requiring increased city support to address its infrastructure requirements. Furthermore, the Preliminary Ten-Year Capital Strategy should be revised to provide improved information on the needs and expected outcomes of proposed investments.
Recommendations related to Capital Planning
The City should increase support for the New York City Housing Authority given $17 billion in unmet capital needs.
The City should revise the Preliminary Ten-Year Capital Strategy to provide improved information on the needs and expected outcomes of proposed investments.
Key Data
$17 billion
— Unmet capital needs for the New York City Housing Authority.
$1.5 billion
— Homeless shelter funding budgeted in fiscal year 2017.
$1.1 billion
— Homeless shelter funding assumed in years subsequent to fiscal year 2017.
New York City's public school system faces significant capacity imbalances, with 51% of students in overcrowded buildings while 161,336 seats remain unfilled in other facilities. Rather than relying solely on new construction, the city should prioritize space management solutions that utilize existing capacity to address crowding more efficiently.
Recommendations related to Capital Planning
Policymakers should prioritize space management solutions that take advantage of existing unused space to adequately meet the needs of the 1 million students in the city’s public school system.
The city should consider shifting students to different schools or moving schools to different buildings to address crowding faster and without unnecessary capital expenditure.
A clearer understanding of the extent of crowding, where it occurs, and whom it affects can guide policymakers toward a solution that best utilizes existing capacity and effectively addresses crowding.
Key Data
51%
— Percentage of students who attend schools that are over capacity.
161,336
— Number of unfilled seats available in school buildings citywide.
109,278
— Number of students in excess of capacity in 784 crowded school buildings.
53%
— Percentage of identified school capacity needs funded by the 2015-2019 Department of Education Capital Plan.
38,463
— Number of needed school seats left unfunded by the 2015-2019 Capital Plan.
24,000
— Total capacity shortfall of seats in elementary school buildings.
The Dormitory Authority of the State of New York (DASNY) is profiled in a collaborative report with City & State, which includes a detailed analysis of the agency's operations. This profile serves as an introduction to a broader examination of the authority's role and functions.
Tony Guida sits down with the CBC's Vice President, Maria Doulis, to discuss why New York City's mega-projects run over budget and how the public sector can build better.
The 2016 state budget agreement increased capital spending by allocating $1 billion for the Javits Center expansion and $1.5 billion for high-tech economic development. Additionally, the state approved a $54 billion, five-year transportation capital plan, though the long-term impact on the state's already high debt burden remains unclear.
Key Data
$1 billion
— Amount added to capital spending for the expansion of the Javits Center.
$1.5 billion
— Amount added to capital spending for high-tech economic development through the Urban Development Corporation.
$54 billion
— Total value of the approved five-year transportation capital plan.
The fiscal year 2017 New York State budget includes a growing capital budget that funds ad-hoc initiatives without a meaningful planning process or consideration of long-term debt implications. Specific capital expenditures include $1.3 Billion for nanotechnology and high-tech manufacturing subsidies, $1 Billion for the Jacob Javits Center expansion, and $300 Million for a Long Island research corridor.
Key Data
$1.3 Billion
— Subsidies for nanotechnology and high-tech manufacturing included in the capital budget.
$1 Billion
— Funding allocated for the Jacob Javits Center expansion.
$300 Million
— Funding for a research corridor on Long Island.
New York State's plan to use $2.3 billion in bank settlement funds to subsidize the Thruway Authority undermines the long-standing principle that road infrastructure should be self-funded through user tolls. Instead of relying on general tax-funded subsidies that encourage motor vehicle use, the state should maintain the Authority's financial independence by adjusting tolls and removing non-transportation burdens like the Canal Corporation.
Recommendations related to Capital Planning
The Governor and the Legislature should make a U-turn in policy and return to a sounder approach to funding the Authority.
The Legislature should concur with the proposal to remove the Canal Corporation from the Thruway Authority to save on operating losses and capital spending.
The Legislature should reject the proposal to require the Thruway Authority to pay for its own policing, which costs approximately $35 million annually.
The State should refrain from allocating additional bank settlement funds to the Thruway Authority in the 2016-2017 budget.
Key Data
$2.3 billion
— Proposed subsidy from bank settlements for the Thruway Authority.
$4.6 billion
— Total bank settlement funds appropriated in the fiscal year 2015-2016 budget.
$1.3 billion
— Amount of bank settlement funds previously appropriated to the Authority for its capital program.
$1.0 billion
— Amount of additional bank settlement funds proposed in the Executive Budget for fiscal year 2016-2017.
$50 million
— Estimated annual operating losses saved by removing the Canal Corporation from the Thruway.
$209 million
— Additional capital spending saved by removing the Canal Corporation from the Thruway.
One-time financial settlements should be directed toward long-term capital investments such as pay-as-you-go projects that replace borrowing, rather than being used for operating expenses. Furthermore, the proposed creation of a new oversight entity for capital projects exceeding $50 million should be rejected to avoid blurring lines of accountability and granting excessive power to political appointees.
Recommendations related to Capital Planning
The State’s current year $2.5 billion in one-time financial settlements should be used to provide long-term benefits such as pay-as-you-go capital investments that replace borrowing, enhanced reserves, or accelerated debt payments.
Authority to pursue public-private partnerships should be extended to all State agencies and the City of New York to improve capital project delivery.
The proposal to create a new entity to review capital projects that exceed $50 million should be rejected because it would blur lines of accountability and give new powers to politically appointed individuals.
Key Data
$590 million
— The amount the Executive Budget proposes to dedicate to <b>capital housing projects</b>.
$600 million
— The amount in <b>capital grants</b> provided through Regional Economic Development Councils.
$50 million
— The threshold for <b>capital projects</b> that would be subject to review by the proposed New York Design and Construction Corporation.
The New York State Executive Budget for fiscal year 2016-2017 lacks a rational, coordinated capital planning process, relying on unspecified funding mechanisms for ambitious projects and leaving the MTA capital program and Tappan Zee Bridge replacement costs largely unfunded. While the budget allocates significant one-time legal settlement funds toward transportation and housing capital expenses, it fails to provide a clear strategy for covering the substantial costs of major infrastructure projects.
Key Data
$3.9 billion
— The substantial unfunded costs of the Tappan Zee Bridge replacement, the construction of which is well underway, remain without a clear coverage plan.
$900 million
— The Executive Budget proposes using this amount of one-time legal settlement funds for transportation, including $700 million for the Thruway Authority and $200 million for the Department of Transportation.
$640 million
— The Executive Budget proposes using this amount of one-time legal settlement funds for homeless and affordable housing, with $590 million designated for capital expenses.
$1 billion
— The Executive Budget proposes this amount in new economic development capital grants.
The MTA's revised five-year capital plan appropriately prioritizes maintaining existing subway infrastructure over accelerating the construction of Phase Two of the Second Avenue Subway. By reducing the Phase Two allocation from $1.5 billion to $535 million, the plan aligns project timelines with available resources and ensures that current service reliability and safety remain the primary focus.
Recommendations related to Capital Planning
The MTA Board should move forward with the revised five-year capital plan as is.
The MTA should prioritize keeping existing services in a state of good repair over pushing new projects.
The MTA should ensure that reliable service and safety on current subway lines are not jeopardized.
The MTA should use the start of service on Phase One as a basis for showing the potential for a carefully-planned Phase Two.
Key Data
$1.5 billion
— Original allocation for Phase Two of the Second Avenue Subway.
$535 million
— Revised allocation for Phase Two of the Second Avenue Subway.
$3 billion
— Amount cut from the initial $32 billion capital plan.
$32 billion
— Initial total value of the MTA's capital plan.
$1.0 billion
— Construction work scheduled for 2019 in the initial proposal.
$420 million
— Funding allocated for planning and design in 2015 and 2016.
NY1 At close to $30 billion, the MTA is about to get handed a record sum of money to maintain and expand a transit system that's showing wear and tear from record ridership, but riders shouldn't expect quick fixes.
The MTA's 2015-2019 capital plan has been reduced to $26.1 billion, necessitating a revised plan that prioritizes state of good repair and signaling upgrades over system expansions. Officials must now clearly identify the specific funding sources, whether from taxes, fares, or tolls, in upcoming budget documents.
Recommendations related to Capital Planning
The content of the now reduced scale of the program must be specified in a revised capital plan to be submitted to the Capital Program Review Board.
These challenging cuts should be made in accord with priorities favoring progress toward a state of good repair and enhanced signaling systems over less urgent, albeit desirable, system expansions.
The Mayor and Governor and their budget staffs should identify the sources of their committed funds.
The mix to be relied upon by each government should be specified in the Governor's January 2016 Executive Budget and the Mayor's November Financial Plan modification or January 2016 Financial Plan.
Key Data
$26.1 billion
— The reduced scale of the MTA's 2015 to 2019 capital plan.
$29 billion
— The amount initially sought by the MTA Board for the capital plan.
$26.8 billion
— The amount more recently sought by Chairman Prendergast for the capital plan.
The MTA's current investment policies are projected to leave subway stations without a state of good repair until 2067, highlighting a significant gap in infrastructure maintenance. While the proposed 2015-2019 capital program aims to address 327 structural components through station renewals, the condition of the system varies widely, with the 7 line currently having 37% of its components in need of repair.
Key Data
2067
— The year by which the MTA’s current investment policies would achieve a state of good repair for all subway stations.
37%
— The share of the 7 line's 618 structural components that are not in a state of good repair.
15%
— The share of the 6 line's 1,288 structural components that are not in a state of good repair.
327
— The number of structural components expected to be fixed by the 19 station renewals in the proposed 2015-2019 capital program.
The Metropolitan Transportation Authority struggles to maintain subway stations in a state of good repair, with 21 percent of structural components currently failing to meet standards. To address this, the agency should reallocate funds from expansion projects to station repairs, improve project management to reduce costs, and leverage public-private partnerships to secure additional capital.
Recommendations related to Capital Planning
The MTA should reallocate available capital funds from new expansion projects to state of good repair work.
The agency should improve the management of station projects to lower costs and permit more progress with available funds.
The MTA should experiment with new models of public-private partnerships at selected stations to secure additional capital and implement projects more efficiently.
The agency should identify opportunities for introducing station conservancies to marshal resources to rehabilitate and maintain stations on an ongoing basis.
Key Data
21 percent
— The share of structural components that will not be in a state of good repair after the completion of projects in the 2010-2014 capital plan.
$5.5 billion
— The amount allocated for expansion projects across the mass transit system in the proposed 2015-2019 capital plan.
$1.3 billion
— The amount allocated for structural and architectural station component work in the proposed 2015-2019 capital plan.
$43 million
— The cost per station for ADA accessibility projects in the proposed 2015-2019 capital plan.
$210 million
— The value of subway station improvements to be completed by the developer SL Green as part of an agreement for the One Vanderbilt office tower.
$335 million
— The potential savings that could be redeployed to station work if project costs were reduced by 25 percent.
The Metropolitan Transportation Authority struggles to maintain subway stations in a state of good repair, with over 20 percent of structural components currently failing to meet standards. To address this, the agency should reallocate capital funds from expansion projects to repair work, improve project management to reduce cost overruns, and leverage public-private partnerships to secure additional investment.
Recommendations related to Capital Planning
The agency should reallocate capital funds from new expansion projects to state of good repair work to improve the pace of station rehabilitation.
The MTA should improve the management of station projects to lower costs and permit more progress with available funds.
The agency should experiment with new models of public-private partnerships at selected stations to secure additional capital and implement projects more efficiently.
The MTA should identify opportunities for introducing station conservancies to marshal resources to rehabilitate and maintain stations on an ongoing basis.
The agency should conduct a rigorous assessment of expansion projects before allocating large sums to them at the expense of existing assets.
Key Data
3,195
— Number of structural components that will not be in a state of good repair after the completion of projects in the 2010-2014 capital plan.
21 percent
— Share of structural components that will not be in a state of good repair after the completion of projects in the 2010-2014 capital plan.
$5.5 billion
— Amount allocated for expansion projects across the mass transit system in the proposed 2015-2019 capital plan.
$1.3 billion
— Amount allocated for station work related to structural and architectural components in the proposed 2015-2019 capital plan.
$210 million
— Value of subway station improvements included in the 2014 agreement with the developer of One Vanderbilt.
$335 million
— Potential savings from reducing project costs by 25 percent in the proposed 2015-2019 capital plan.
The Metropolitan Transportation Authority's $29.8 billion capital plan faces a funding gap that should be addressed by shifting the revenue model toward motor vehicle cross-subsidies rather than relying on the traditional City versus State debate. A '50-25-25' funding model, incorporating congestion pricing and a vehicle-miles-traveled tax, offers a more sustainable long-term solution for financing mass transit infrastructure.
Recommendations related to Capital Planning
Drivers should cover more than twice the current proportion of costs for the MTA capital plan.
The public debate should shift to generating more funding for the MTA from motor vehicle cross-subsidies using a '50-25-25' model.
The state should implement a vehicle-miles-traveled (VMT) tax to fund transportation infrastructure over the long term.
Immediate funding should be generated through enhanced tolling policies, including East River bridge tolls and other congestion pricing mechanisms.
Policymakers should consider higher vehicle registration fees as a mechanism for immediate funding.
Key Data
$29.8 billion
— Size of the MTA capital plan.
$9.8 billion
— The reduced funding gap for the MTA plan.
48 percent, 40 percent, and 12 percent
— Current funding breakdown from fares, tax subsidies, and motor vehicle cross-subsidies.
$1.0 billion
— Annual operating and capital support provided by NYC taxpayers.
$4.2 billion
— NYC taxpayers' estimated contribution to the nearly $6 billion allocated to the MTA from state-authorized taxes.
73 percent
— Share of the MTA's $1.3 billion regional payroll tax paid by New York City employers.
The Metropolitan Transportation Authority's 2015-2019 capital plan faces a $9.8 billion funding gap, requiring a shift away from debating City versus State contributions toward a unified funding strategy. Future transit funding should rely on a mix of fares, tax subsidies, and increased motor vehicle cross-subsidies, such as congestion pricing or vehicle-miles traveled fees, to better address infrastructure needs.
Recommendations related to Capital Planning
The MTA should specify which projects will utilize alternative project delivery methods in the revised capital plan.
City, State, and MTA leaders should drop the "City/State" frame of reference when debating funding.
Leaders must develop a concrete plan to put the necessary funding in place for the capital program.
The MTA should increase funding from motor vehicle cross-subsidies, such as East River bridge tolls, congestion pricing, or higher vehicle registration fees.
In the longer term, the state should implement a vehicle-miles traveled fee system to fund transportation infrastructure.
Key Data
$2.2 billion
— Estimated savings from efficiencies, representing 6 percent to 8 percent of the capital plan.
$9.8 billion
— The funding gap between the City and State for the MTA capital plan.
$580 million
— Annual operating and capital support provided to the MTA by New York City taxpayers.
$4.2 billion
— The estimated portion of the nearly $6 billion in state-authorized regional and statewide taxes that is funded by New York City taxpayers.
73 percent
— The share of the MTA's $1.3 billion regional payroll tax paid by New York City firms.
12 percent
— The current share of MTA transit services funding derived from motor vehicle cross-subsidies.
Brooklyn Independent Media The Mayor's Executive Budget, which leaves unanswered how billions of dollars in much-needed transit improvements will be funded. The MTA is preparing its capital plan through 2019 which will determine the system's future condition.
New York City's outstanding debt has exceeded $110 billion, and the proposed Ten-Year Capital Strategy would further increase this burden, with debt service costs projected to rise by 30 percent. Because the city lacks a comprehensive needs assessment and performance metrics for its capital projects, it is difficult to determine if these significant investments are worthwhile or effectively managed.
Recommendations related to Capital Planning
New investments need to be undertaken cautiously given the large and growing debt load.
Proposed capital spending should be limited to clearly defined projects with demonstrable benefits.
The City should provide the information needed to judge whether planned investments are worthwhile.
The City should link the Capital Strategy directly to a needs assessment to determine progress toward achieving a state of good repair.
Key Data
$110 billion
— Outstanding debt as of June 30, 2014.
96 percent
— Growth in outstanding debt since 2002.
8 percent
— Debt repaid from tax revenues in fiscal year 2016 as a percentage of real property values.
13 percent
— Debt repaid from tax revenues in fiscal year 2016 as a percentage of personal income.
$83.8 billion
— Total value of the proposed Ten-Year Capital Strategy for Fiscal Years 2016-2025.
30 percent
— Projected increase in debt service paid from the operating budget.
The New York City Housing Authority faces a severe financial crisis, with projected deficits reaching $194 million by 2019 due to high operating costs and insufficient revenue. To address these challenges, the "NextGeneration NYCHA" roadmap proposes operational reforms, increased non-rental income, and residential infill development to ensure long-term financial stability.
Recommendations related to Capital Planning
NYCHA should increase rent collection rates to HUD's 95 percent target to generate an estimated $39 million in 2015.
The authority should generate more non-rental income by increasing parking fees, increasing monthly fees for appliances, expanding commercial activities, and raising rent collections from nonprofit tenants.
NYCHA should streamline management to curtail the scope of responsibility for borough offices to non-redundant functions.
The authority should eliminate responsibility for community and senior centers and rely on service provision by better-equipped City agencies and nonprofits.
NYCHA should increase use of Job Order Contracting, which streamlines and shortens the process to perform more routine maintenance.
The authority should negotiate work rule changes in collective bargaining to limit overtime compensation for work performed in the evenings and on weekends.
NYCHA should pursue cost savings through private property management companies.
Key Data
$194 million
— Projected operating deficit for the New York City Housing Authority in 2019.
77 percent
— The average rent collection rate for the New York City Housing Authority.
$320
— The amount by which the New York City Housing Authority's monthly operating costs per unit exceed those of a private rent-stabilized unit.
$39 million
— Estimated revenue generated by increasing rent collection rates to HUD's 95 percent target.
$68 million
— Annual savings yielded by reducing the operating cost gap between the New York City Housing Authority and rent-stabilized units by 10 percent.
$400 million to $800 million
— Revenue generated over 10 years from two types of residential infill development.
New York City's $83.8 billion Ten-Year Capital Strategy lacks sufficient information regarding needs assessments, performance metrics, and long-term operating costs, making it difficult to evaluate the effectiveness of these investments. Furthermore, the city's reliance on borrowing to fund these projects has resulted in over $100 billion in outstanding debt, which is increasingly crowding out other spending in the operating budget.
Recommendations related to Capital Planning
The City should incorporate information from agency assessments to clearly spell out how much of the state of good repair needs will be addressed by proposed investments.
The City should provide specificity for OneNYC investments before dollars are appropriated.
The City should provide performance metrics and timelines with milestones to assess spending.
The City should consider and incorporate operating costs or savings into the capital planning or budgeting process.
The Council should require improved reporting on the rationale for and performance goals of capital spending.
The Council should limit the capital budget to clearly defined projects with demonstrable benefits.
Key Data
$83.8 billion
— Total value of the Ten-Year Capital Strategy for Fiscal Years 2016 to 2025.
$30 billion
— Increase in the Ten-Year Capital Strategy compared to the prior strategy released in 2014.
$22 billion
— Amount of new OneNYC investments for which details are lacking.
$100 billion
— Amount of debt the City has outstanding.
$30 billion
— Amount of additional debt the City will issue in the next four years to support the new capital plan.
$7.7 billion
— Projected annual debt service by fiscal year 2019.
The fiscal year 2016 executive budget includes the creation of a $500 million capital program fund as part of a broader strategy to utilize increased tax revenues for reserves and spending. This allocation is intended to bolster the city's financial position alongside other reserve increases and social service commitments.
Key Data
$500 million
— The amount allocated for the creation of a new capital program fund in the fiscal year 2016 executive budget.
New York City's preliminary Ten-Year Capital Strategy proposes $67.7 billion in capital commitments, yet it lacks critical details regarding financing, performance targets, and infrastructure priorities. The plan's current debt levels, at 8 percent of real property values, exceed the 5 percent affordability benchmark, necessitating greater transparency on cost and repair timelines.
Recommendations related to Capital Planning
The City should clarify how much more debt will be issued and what benchmarks will be used to determine affordability.
Each agency should describe how its capital spending plans advance the goals of OneNYC, and funding for specific OneNYC infrastructure initiatives should be clearly identified.
Agency plans should be accompanied by information on per-unit costs and performance targets to assess priorities and performance.
The Strategy should incorporate information from asset assessments and clearly spell out how much of state of good repair needs will be addressed by the proposed investments, and how quickly.
Key Data
$67.7 billion
— Total capital commitments in the preliminary Ten-Year Capital Strategy.
$14 billion
— Amount by which the preliminary strategy exceeded the previous ten-year plan.
8 percent
— Debt supported directly by City tax dollars as a percentage of real property values.
5 percent
— The affordability benchmark for debt supported by City tax dollars.
The Metropolitan Transportation Authority faces significant financial instability due to recurring operating deficits and a heavy reliance on borrowing for capital investments, which has led to unsustainable levels of indebtedness. To address these issues, a new financing policy is proposed that allocates costs among transit riders, motorists, and taxpayers to ensure fiscal stability and fund necessary capital improvements.
Recommendations related to Capital Planning
The cost of bridge and tunnel facilities should be funded entirely through user fees paid by motorists.
Motorists’ tolls and fees should also generate a surplus large enough to cover approximately one-quarter of the cost of providing mass transit services.
Mass transit users should pay fares sufficient to cover approximately one-half the operating cost of those services.
State and local tax subsidies to mass transit should cover at least one-quarter of the operating cost of those services and fund 'catch-up' capital investments needed to bring the system to a state of good repair.
The MTA should stop running large deficits and lower its future debt burden by funding regular replacement needs with operating revenues rather than borrowing.
Key Data
$79.8 billion
— Total capital investments authorized from 1982 thru 2009.
$26.3 billion
— Approved 2010-2014 capital plan.
$24.2 billion
— Amended 2010-2014 capital plan.
$16.8 billion
— Total investment in five 'megaprojects'.
$3.6 billion
— Cost overruns for the five 'megaprojects'.
The Preliminary Ten-Year Capital Strategy for Fiscal Years 2016 - 2025 is valued at $68 billion, representing a significant increase over the $54 billion strategy for 2014 - 2023. Given the city's rising debt burden, the capital plan requires a thorough assessment of its priorities and overall affordability.
Key Data
$68 billion
— The size of the Preliminary Ten-Year Capital Strategy for Fiscal Years 2016 - 2025.
$54 billion
— The size of the Strategy for 2014 - 2023.
The Port Authority of New York and New Jersey's maritime ports face persistent annual deficits, necessitating a strategic shift toward rightsizing port capacity and improving operational productivity. By closing underperforming facilities and renegotiating labor agreements, the agency can reduce its financial burden and reallocate capital toward more critical regional transportation infrastructure investments.
Recommendations related to Capital Planning
The Port Authority should "rightsize" port capacity by closing obsolete and underperforming facilities not needed to meet likely future demand.
The agency should increase revenue opportunities by supporting more competitive and productive terminal operations through collective bargaining.
The Port Authority must begin to initiate these actions now to realize the benefits of the recommendations.
The Port Authority should recruit other terminal operators from around the world or introduce direct operation at at least one facility to inject competition into the lease process.
The agency should support changes to collective bargaining agreements to lower costs driven by staffing arrangements for crews or "gangs."
The Port Authority should support the elimination of container royalties paid by shippers to the workers' union to fund payments and benefits beyond those funded in their contracts.
Key Data
$2.8 billion
— Total capital plan commitment for projects affecting Port Commerce from 2014 to 2023.
$107 million
— Projected annual deficit for Port Commerce in 2029.
$29 million
— Projected annual savings by 2029 from closing Brooklyn and Red Hook facilities.
$354 million
— Estimated container royalties paid by carriers for New York-New Jersey terminals in 2013.
$300 million
— Potential cost savings from the elimination of cash payments and port-specific assessments.
$1.3 billion
— Amount authorized by the Port Authority for the Bayonne Bridge Navigational Clearance Program.
City Planning Commissioner Carl Weisbrod discusses the de Blasio's administration's approach to land use and developing New York City's Ten-Year Capital Strategy.
The Metropolitan Transportation Authority's $32 billion capital plan faces a $15 billion funding gap and criticism for prioritizing new expansion projects over essential infrastructure repairs and signal modernization. To address this shortfall, a "25-50-25" funding model is proposed, relying on a combination of tax subsidies, fare increases, and increased contributions from motor vehicle users through tolls and congestion pricing.
Recommendations related to Capital Planning
The MTA should prioritize bringing aged infrastructure to a state of good repair rather than focusing on new expansion projects.
The MTA must accelerate the schedule for installing Communications-Based Train Control (CBTC) to improve safety and efficiency.
The MTA should implement a "25-50-25" funding approach that balances revenue from tax subsidies, user fees, and cross-subsidies.
The MTA should pursue modest fare increases to help close the funding gap and meet the 50 percent target for user fee contributions.
The MTA should increase motor vehicle user cross-subsidies through mechanisms like tolls and a vehicle-miles-traveled tax to ensure drivers contribute to the system.
Key Data
$32 billion
— The total investment amount in the MTA's proposed 2015-2019 capital plan.
$15 billion
— The size of the funding gap in the MTA's capital plan that requires new revenue sources.
$5.5 billion
— The amount allocated in the proposed plan for projects that would expand the network.
$2.6 billion
— The cost overruns associated with the East Side Access project.
$1.6 billion
— The annual increase in funding provided by the payroll mobility tax authorized in 2009.
$167 to $293
— The range of annual increased costs motorists would face under the proposed Move New York plan.
The Metropolitan Transportation Authority's 2015-2019 capital plan faces a $15.2 billion funding gap and fails to adequately prioritize essential repairs and signal modernization over new expansion projects. The plan should be revised to establish clear criteria for project selection and to accelerate the implementation of critical infrastructure upgrades before committing to costly new initiatives.
Recommendations related to Capital Planning
The proposed plan should be revised to address the insufficient progress in bringing aged infrastructure to a state of good repair.
The MTA should embrace a more ambitious schedule for Communications-Based Train Control installation and provide the necessary funding in the 2015-2019 plan.
Explicit criteria should be established for selecting priority projects and evidence should be considered as to how well a range of potential investments meet these criteria.
A prudent course for the MTA would be to postpone commitment to new expansion projects until an improved planning process is established and used to assess multiple potential projects.
Attention should be given to rethinking the management of large-scale projects, especially those for expansion and for improvements in the signal and communication systems, to promote more effective implementation.
Key Data
$32 billion
— Total investment plan approved by the MTA Board for 2015-2019.
$15.2 billion
— The amount of the capital plan that remains unfunded.
$5.4 billion
— Total shortfall in the capital plan compared to the 2013 needs assessment.
$10.8 billion
— Current estimated cost of the East Side Access project, which was originally approved at $6.3 billion.
$743 million
— Amount committed to the Penn Station Access project, despite unquantified benefits and unreported total costs.
$2.6 billion
— Additional funding that had to be allocated to the East Side Access project in the 2015-2019 plan.
The PATH transit system faces growing annual deficits, projected to reach $487 million by 2018, necessitating a shift from its current reliance on bridge and tunnel toll cross-subsidies to a more equitable funding model involving passenger fares and tax subsidies. Implementing a new financing structure, such as a "50-25-25" or "equal shares" approach, would reduce the burden on toll payers and provide additional resources for regional capital projects.
Recommendations related to Capital Planning
PATH should adopt a consistent funding structure that shares the cost of operating the transit system among all who benefit, including passengers, taxpayers, and motorists.
The agency should implement a "50-25-25" or "equal shares" formula to distribute revenue requirements among fares, tax subsidies, and cross-subsidies.
Consideration should be given to altering PATH's governance to facilitate the collection of a tax subsidy and improve coordination with other bi-state transit operations, such as transferring operations to NJT.
PATH could pursue changes to make the fare system more equitable, such as implementing a distance-based fare system or peak pricing.
Key Data
$487 million
— The projected annual deficit for PATH in 2018.
$3.9 billion
— The estimated cost of the new WTC terminal and related amenities.
$1.9 billion
— The total planned capital investments for PATH during the 2014-2018 period.
$1.5 billion
— The expected cost of the project to extend PATH to Newark Airport.
$2.2 billion
— The total estimated value of damage to PANYNJ facilities from Superstorm Sandy.
$1 billion
— The amount PANYNJ expects to spend on Sandy-related capital projects over 10 years.
The New York State Department of Transportation faces significant challenges that require a comprehensive needs assessment and the identification of necessary resources to effectively implement a capital plan. This collaborative effort highlights the critical steps needed to address the agency's infrastructure and planning requirements.
New York's 10-year statewide capital plan identifies $174 billion in capital needs, with $118 billion required specifically for state-of-good-repair projects to bring assets to an acceptable condition. Utilizing settlement funds for pay-as-you-go capital investments could accelerate these necessary repairs, such as renovating approximately 200 of the city's 468 subway stations, without incurring additional debt service.
Recommendations related to Capital Planning
The state should increase pay-as-you-go capital investments to avoid debt service and accelerate reaching state-of-good-repair for key assets in the transportation and transit systems.
Key Data
$174 billion
— The total 10-year statewide capital plan needs across 47 state agencies and public authorities.
$118 billion
— The portion of the 10-year capital plan dedicated to state-of-good-repair projects to bring assets to an acceptable condition.
200
— The number of the city's 468 subway stations that could be renovated using settlement funds.
The Port Authority has made progress in implementing long-term capital planning strategies and commitment plans, though it lacks explicit policies for financing capital investments and transparent reporting on project status. While the agency maintains a $780 million surplus available for capital investment, it has yet to fully adopt independent engineering oversight or detailed project-level funding disclosures.
Recommendations related to Capital Planning
Use a long-term strategy to guide the capital budget.
Base capital strategy on professional assessment of needed investment to maintain state of good repair and accommodate long-term demand trends.
Prepare annual and four-year commitment plans revised annually.
Adopt explicit policy for financing capital investments with debt and pay-as-you-go (PAYGO) sources.
Indicate sources of funding for each capital investment.
Report quarterly on the status of each capital project relative to scheduled milestones and planned costs.
Use independent engineering consultants to monitor major capital projects and report to the board and to the public.
Key Data
$780 million
— Surplus available for capital investment shown in the adopted budget.
The PATH transit system faces growing annual deficits, projected to reach $487 million by 2018, due to high operating costs and a reliance on bridge and tunnel toll cross-subsidies. To improve fiscal viability, the system should adopt a more equitable funding model that balances costs among passengers, motorists, and taxpayers, potentially including a shift in governance to New Jersey Transit.
Recommendations related to Capital Planning
PATH should adopt a consistent funding structure that shares the cost of operating the transit system among all who benefit.
Auto user fees should pay for the facilities available to drivers, meaning the cost of bridge and tunnel facilities should be funded entirely through tolls and fees paid by the motorists who use them.
Motorists’ tolls and fees should also generate a surplus large enough to cover a share of the cost of providing mass transit services.
Mass transit users should pay fares sufficient to cover a share of the cost of those services.
State and local tax subsidies to mass transit should cover a share of the cost of those services.
Implementing the recommended changes in financing for PATH could be accompanied by a shift in governance authority and operational responsibility for the rail lines to NJT.
Key Data
$487 million
— Projected annual deficit for the PATH system in 2018.
$387 million
— Projected annual deficit for the PATH system in 2014.
$383 million
— PATH's annual deficit in 2013.
$1.96
— Average fare revenue per ride in 2013.
$8.45
— Actual full cost of a ride in 2013.
$2.2 billion
— Estimated total value of damage from Superstorm Sandy to facilities.
New York City spends nearly $3 billion annually on economic development, yet much of this funding lacks analysis to ensure it effectively stimulates growth. Future investments should prioritize infrastructure in neighborhoods with high growth potential rather than providing subsidies to individual firms.
Recommendations related to Capital Planning
The goal should be to narrow these investments to those that enhance infrastructure in neighborhoods with growth potential.
The beneficiaries of city capital dollars should be neighborhoods, not individual firms.
Key Data
$3 Billion
— Annual spending by New York City to cultivate industries, attract and keep businesses, and stimulate development.
This discussion took place as part of the CBC's Conference, The Most Important Economic and Fiscal Decisions Facing the Next Mayor, held on December 6, 2013 in New York City. Presenter: Maria Doulis Moderator: Anita Laremont Panelists: Rohit Aggarwala, Denise Richardson, Marcia Van Wagner, and Christopher Ward
New York City's capital planning process requires significant reform, including the establishment of clear asset management policies and a "fix it first" strategy to address the maintenance backlog and high debt burden. The next administration should prioritize state of good repair projects, adopt cost-effective contracting methods, and implement rigorous investment standards to ensure long-term infrastructure sustainability.
Recommendations related to Capital Planning
The next administration should enact clear guidelines or directives for performing routine maintenance and regular replacement of assets to prevent the state of good repair backlog from growing.
All city agencies and component units should undertake a comprehensive needs assessment that details the condition of major asset classes and the cost to fix those in disrepair.
The next mayor should articulate a standard for keeping debt from becoming unaffordable by defining an investment policy that includes two standards: one for maintaining a responsible level of debt and one for the regular use of pay-as-you-go capital.
The City should adopt a “fix it first” strategy, in which state of good repair projects receive priority at each agency.
City leaders should advocate for changes to contracting rules that increase costs and impede efficient construction management, such as a repeal of Wicks Law and an expansion of the city’s toolbox for effective contracting.
Key Data
$100 billion
— The City has more than $100 billion in debt outstanding and its debt burden is high when evaluated under the benchmarks used by rating agencies to assess affordability.
79 percent
— Capital investment increased the value of the assets owned by New York City and its related public authorities by 79 percent since fiscal year 2002 to $87.7 billion.
65 percent
— City debt service has been rising at a rapid rate, growing 65 percent between fiscal years 2002 and 2014.
30 percent
— By 2008, construction costs citywide were 30 percent higher than they were in 2002.
25 percent
— A 2012 report found that prevailing wage mandates increase the cost of housing construction by 25 percent.
15 percent
— The Bloomberg Administration consistently kept capital spending at a level such that debt service remained near 15 percent of total city tax revenues.
New York State's first 10-year statewide capital plan commits $174 billion to infrastructure projects, with 65 percent allocated to transportation and the majority designated for state of good repair projects. To improve future iterations, the state should enhance asset condition assessments, establish a clear financing framework to address affordability, and provide project-level data for better tracking.
Recommendations related to Capital Planning
The state should include better information about asset condition and the match-up between planned levels of state of good repair (SOGR) spending and need in future capital plans.
The state should develop an improved financing plan that addresses the issue of affordability for capital projects.
Future capital plans should include better project-level data to facilitate project tracking.
The state should set condition improvement targets and provide estimates of the cost of achieving the desired improvement for infrastructure assets.
The next capital plan should reconcile differences and standardize the approach to commitments versus financing and disbursements across agencies.
Future Statewide Plans should include information that allows the user to "roll down" to project-specific information.
Key Data
$174 billion
— Total planned investment commitments for the fiscal year 2013-14 to 2022-23 period.
$113 billion
— Amount of the capital plan committed to transportation, representing 65 percent of the total.
$117.8 billion
— Total funding allocated for State of Good Repair (SOGR) projects.
$180.3 billion
— Total debt outstanding for agencies and authorities included in the plan for fiscal years ending in 2011-12.
$177 billion
— Total amount the state expects to raise from all sources over the period of the plan.
$95.4 billion
— Total assets net of depreciation reported by New York State in fiscal year 2012.
The Port Authority of New York and New Jersey currently lacks a multi-year financial plan and a formal capital plan, relying instead on project-by-project approvals. To improve transparency and accountability, the agency should adopt a long-term capital strategy and provide regular, public reporting on the status and costs of major infrastructure projects.
Recommendations related to Capital Planning
The PANYNJ’s capital budgeting should be guided by a long-term (a period of 10 to 20 years) capital strategy that is revised every four years.
The capital budget should include an annual and a four-year commitment plan revised annually.
Regular and frequent (quarterly) reports should be made to the Board and the public on the status of each capital project relative to the scheduled milestones and planned costs for the project.
New York City's Ten-Year Capital Strategy outlines $53.7 billion in infrastructure investments, yet the city faces a high and growing debt burden that limits the ability to fund necessary repairs and climate resiliency projects. The next administration must navigate difficult trade-offs between maintaining existing assets and pursuing new capital projects while keeping debt service costs affordable.
Recommendations related to Capital Planning
The next mayor will have to make difficult trade-offs between competing priorities while ensuring the city’s debt does not become unaffordable.
The next mayor will have to determine a level of long-term capital investment that takes into account the city’s already high debt burden.
Future proposals for resiliency efforts will need to be incorporated into the city’s long-term capital agenda.
Key Data
$53.7 billion
— Total capital commitments proposed in the Ten-Year Capital Strategy for Fiscal Years 2014-2023.
58 percent
— Portion of required state of good repair work funded in the fiscal year 2014 report.
$67.9 billion
— City debt outstanding in fiscal year 2013.
14 percent
— Ratio of city debt to personal income in fiscal year 2013, which is considered high.
17 percent
— Projected share of city-funded expenditures dedicated to debt service by fiscal year 2017.
45 percent
— Growth in city debt outstanding since 2003.
The Metropolitan Transportation Authority faces significant financial instability due to recurring operating deficits and a heavy reliance on borrowing to fund capital needs, which has led to growing indebtedness and inadequate investment in maintaining a state of good repair. To address these issues, a new financing formula is proposed that would reallocate costs among transit riders, motorists, and taxpayers to ensure more stable funding for both operations and necessary capital improvements.
Recommendations related to Capital Planning
The cost of bridge and tunnel facilities should be funded entirely through user fees paid by motorists.
User fees paid by motorists should also generate a surplus large enough to cover approximately one-quarter of the cost of providing mass transit services.
Mass transit users should pay fares sufficient to cover approximately one-half the operating cost of those services.
State and local subsidies to mass transit should cover at least one-quarter of the operating cost of those services and fund 'catch-up' capital investments needed to bring the system to a state of good repair.
The MTA should stop running large deficits and lower its future debt burden by funding regular replacement needs with operating revenues rather than borrowing.
Key Data
$79.8 Billion
— Total capital investments authorized for the MTA from 1982 thru 2009.
$26.3 Billion
— The MTA's Capital Program Review Board approved capital plan for 2010-2014.
$24.2 Billion
— The amended 2010-2014 capital plan amount as of March 2012.
$16.8 Billion
— Total investment in five MTA 'megaprojects' including the South Ferry Terminal, Fulton Street Transit Center, Flushing Line Extension, Second Avenue Subway, and East Side Access.
$3.6 Billion
— Total cost overruns associated with the five MTA 'megaprojects'.
$2 Billion
— Current annual depreciation at the MTA.
New York City's capital budget lacks transparency in project prioritization and evaluation, with $1.5 billion allocated to economic development projects without cost-benefit analysis while state-of-good-repair needs remain underfunded. To address growing debt service, the city should restrain capital commitments and establish clear criteria for prioritizing projects based on condition, need, or return on investment.
Recommendations related to Capital Planning
The City should reexamine the level and nature of capital investments to address growing debt service.
Growth in capital commitments should be restrained to manage the city's rising debt service costs.
Greater scrutiny should be placed on capital projects to ensure they are justified and evaluated properly.
Clear criteria should be established for prioritizing projects based on condition, need, or return on investment.
Key Data
$40 Billion
— Amount in capital spending planned over the next five years.
$1.5 Billion
— Amount allocated to economic development projects over the fiscal years 2012–2015 period without cost-benefit analysis.
52%
— Portion of state-of-good-repair needs that will be funded in fiscal years 2013 to 2016.
The $500 million CityTime settlement should be used to defray the costs of the City's capital program rather than for short-term budget relief. These funds should specifically be applied to retiring debt from technology projects or utilized as pay-as-you-go capital financing to minimize future borrowing.
Recommendations related to Capital Planning
It is important that the recouped funds be used, not for short-term budget relief and restorations, but to help defray the costs of the City’s capital program.
An appropriate and responsible use of settlement funds would be to retire debt issued to finance technology projects.
An appropriate and responsible use of settlement funds would be to use the funds as pay-as-you-go capital financing, reducing the need for additional borrowing.
Key Data
$500 million
— The amount of the CityTime settlement announced in March 2012.
New York City's current method for calculating the rental payment from the water and sewer system to the city treasury is arbitrary and has contributed to rapidly rising water rates. Replacing this formula with a more logical basis, such as charging for specific services rendered or applying utility taxes, would improve transparency and fairness, though it would likely not result in lower costs for customers.
Recommendations related to Capital Planning
The City should adopt a method of payment based on the cost of City-funded GO debt service plus payment for services rendered by the City to the water and sewer system.
The Water Board could make a rental payment equivalent to what it would pay in City property taxes under the rate charged utilities.
The Water Board could make a rental payment equivalent to what it would pay under the utilities business income tax.
The Water Board could make a rental payment equivalent to what it would pay for property and utilities business income taxes combined, as other utilities do.
Key Data
$234 million
— The budgeted rental payment for fiscal year 2012.
$102 million
— The low point of the rental payment in 2003.
$73.8 million
— The amount the Water Board paid the City in fiscal year 2011 for judgments, claims, and street cleaning services.
$30 billion
— The amount of capital investment authorized by the Water Board to expand, improve, and maintain the system since 1985.
$12.1 billion
— The projected capital investment commitment over the ten years following 2011.
7.5%
— The average percentage of revenues paid toward city services by water systems in Utica, Buffalo, and Niagara Falls.
Public-private partnerships (PPPs) offer a mechanism to improve infrastructure management by focusing on life-cycle costs and maintenance, provided they are employed selectively and with enhanced public sector oversight. New York should prioritize pilot programs for assets in poor condition, such as bridges and school buildings, to establish benchmarks for performance and efficiency.
Recommendations related to Capital Planning
PPPs should be focused on achieving efficiencies in the life cycle costs of facilities and ensuring their long-term maintenance at standards higher than typically achieved by direct public sector operation.
In selecting opportunities for effective PPPs, New York’s leaders should give high priority to assets that are currently in poor condition and have a history of poor maintenance.
In most cases, the PPPs should be initiated as pilot programs and viewed as benchmarks for project delivery times and maintenance standards.
A group of planned new schools and/or school renovation projects should be considered for a PPP modeled on the British experience with “strategic partnerships” to create a strategic framework for building or renovating a number of smaller capital assets.
The public sector must develop an enhanced capacity for contract design, performance measurement and monitoring in order for PPPs to be successful.
Key Data
$509 billion
— Total value of 1,109 PPP projects launched worldwide between 1985 and 2007.
$3.2 billion
— Critical maintenance backlog for the City University of New York system.
$1.7 billion
— Critical maintenance backlog for the State University of New York system.
$24.3 billion
— 22-year cumulative value of PPP projects in the United States.
73%
— Percentage of conventionally procured projects that were over budget, compared to 22% for PFI projects in a 2003 NAO study.
70%
— Percentage of conventionally procured projects that were delivered late, compared to 24% for PFI projects in a 2003 NAO study.
New York City's accounting practices allow for multiple definitions of a balanced budget, with the most comprehensive standard revealing significant deficits due to depreciation of physical assets and retiree health benefit obligations. Moving toward this more transparent accounting framework is essential to ensure current residents do not unfairly impose financial burdens on future generations.
Recommendations related to Capital Planning
New York City should not have its own unique set of accounting rules, a version that allows what the rest of the world views as an operating expense to be labeled a capital investment and paid for with borrowed funds that our children will repay.
New Yorkers should be giving much more attention to the financial results disclosed under the new GAAP rules.
Municipal leaders should adopt a vision of moving from the current self-deluding standard for a balanced budget to a more meaningful one.
A similar time frame to the seven years it took to balance the budget during the fiscal crisis might be appropriate for recognizing that times have changed and a new standard is needed for local financial management.
Key Data
$9.6 billion
— The deficit in fiscal year 2011 under the new GAAP standard.
$282 million
— The deficit in fiscal year 2011 if GAAP were strictly applied to remediation expenses.
$5 million
— The surplus reported by the Comptroller for fiscal year 2011 based on the exemption from GASB rules.
$53.3 billion
— The added expense in fiscal year 2006 when the accumulated OPEB liability was first recognized.
$11.7 billion
— The amount of red ink in fiscal year 2010 under the new GAAP standard.
New York City should expand the use of public-private partnerships to address infrastructure maintenance backlogs by applying these models to smaller-scale assets like schools and parks. By bundling these smaller projects, the city can effectively leverage private investment to overcome funding limitations and improve operational outcomes.
Recommendations related to Capital Planning
The challenge – and opportunity – will be to harness best practices to apply PPPs to assets of a smaller scale, notably schools, parks and bridges.
The city should move toward negotiating agreements that bundle together several schools or small parks.
Key Data
$1.4bn
— The value of the deal negotiated by the Port Authority of New York and New Jersey for Terminal Four at John F. Kennedy International Airport.
$20m
— The annual payments provided by Cemusa for the design, construction, and maintenance of street furniture.
5,800
— The number of miles of streets and highways in New York City.
790
— The number of bridges in New York City.
1,000
— The number of public school buildings in New York City.
New York City's fiscal health is threatened by structural deficits driven by the rapid growth of health insurance, pension contributions, and debt service, which are projected to consume 33 percent of total revenues by 2015. To address these challenges, the city must implement structural reforms to labor costs and downsize the capital budget to prioritize essential infrastructure over non-essential economic development projects.
Recommendations related to Capital Planning
The Mayor and City Council should make slowing the growth of debt service a higher priority by downsizing the capital budget.
Resources should be directed toward the rehabilitation of essential infrastructure, like schools, roads, bridges, water mains and sewer pipes.
Non-essential expenses, such as economic development projects, should be postponed or reassessed to ensure that a strong economic justification for undertaking each project exists.
Key Data
$4.8 billion
— The projected budget gap for fiscal year 2013.
$11 billion
— Total spending on health insurance, pension contributions, and debt service in 2005.
$23.1 billion
— Projected spending on health insurance, pension contributions, and debt service in 2015.
$30 billion
— Total savings from pension reform over the next 30 years.
Despite multiple rounds of announced cuts to the capital budget since 2008, New York City's infrastructure spending commitments have continued to rise, reaching a record high of over $12 billion for fiscal year 2011. To address this, the city must apply the same rigorous prioritization to its capital planning as it has to its operating budget to avoid the pattern of rolling over unfinished projects.
Recommendations related to Capital Planning
The Mayor must become more determined about establishing priorities in the capital budget the way he has for the operating budget.
Key Data
$12 billion
— Projected 2011 capital commitments, which represent a new record high.
$12.2 billion
— Average yearly capital commitments since the Mayor began cutting the capital plan.
26 percent
— Increase in average yearly capital commitments compared to the period between fiscal years 2006 and 2008.
$38.9 billion
— The commitment plan for fiscal years 2009-2012 after a 20 percent reduction announced in May 2008.
$26.2 billion
— The total commitment plan for fiscal years 2010-2013.
$1.3 billion
— Commitments for parks in fiscal year 2011, reaching an all-time high.
New York City faces a significant infrastructure repair backlog, with $5.6 billion in needed work for existing facilities while the capital budget covers only about half of that requirement. To address this, the city must prioritize full funding for maintenance and utilize Asset Information Management System assessments to create a strategic, long-term plan for upgrading assets to a state of good repair.
Recommendations related to Capital Planning
The city should make full funding of maintenance requirements an explicit priority to prevent more costly capital repairs.
The city should use the AIMS condition assessments as the starting point for developing the next 10-year capital plan.
The city should develop a strategy for upgrading all assets to a state of good repair.
The city should consider a reasonable time-horizon for upgrading each class of assets and identify specific steps to make progress against those goals.
Key Data
$5.6 billion
— The amount of state of good repair work needed for existing facilities.
36 percent
— The increase in the estimated cost of needed repairs since 2000.
$2.9 billion
— The funding allocated for AIMS capital work in fiscal year 2011, which is just 53 percent of what is required.
$2.35 billion
— The amount required for transportation assets, of which only 40 percent will be funded.
70 percent
— The portion of maintenance needs funded in the operating budget across all facilities.
$1.2 billion
— The amount of the capital program that could have been devoted to state of good repair annually between 2006 and 2009 to eradicate the identified need.
New York City's capital planning process requires significant reform to effectively manage its $60.5 billion in capital assets, as current practices often fail to prioritize maintenance based on condition or long-term needs. The city should institutionalize a comprehensive, long-term strategic planning approach, establish systematic maintenance schedules funded by operating revenues, and justify expansion projects with rigorous economic analysis.
Recommendations related to Capital Planning
The City should expand and institutionalize the PlaNYC approach to encompass a broader range of public infrastructure and ensure long-term strategic planning.
The City should develop a systematic plan for bringing all City-owned assets to a state of good repair and improve its needs assessments.
The City should place all its capital assets on regular replacement cycles and fund their replacement with operating revenues rather than borrowing.
The City should pursue expansion projects based on rigorous economic analysis that clearly demonstrates economic benefits or a high rate of return.
Key Data
$60.5 billion
— Total value of City-controlled capital assets.
$83.7 billion
— Total planned capital investments over the next ten years.
$38.3 billion
— MTA's entire capital asset portfolio.
$18.4 billion
— Asset value of the water and sewer system.
$7.829 billion
— Port Authority of New York and New Jersey value of capital assets in New York City.
The City's fiscal year 2011 budget relies on exhausted surplus funds to cover expenditures, necessitating a shift toward addressing long-term structural deficits. To manage rising debt service costs, the City should scale back its $43.5 billion capital commitment plan and prioritize essential infrastructure repairs over less urgent development projects.
Recommendations related to Capital Planning
The City should scale back the capital commitment plan for fiscal years 2010-2014 to address the growing pressures of debt service.
The City should focus its capital budget on key priorities, such as state-of-good-repair work on the City's aging infrastructure, rather than less urgent development projects.
Key Data
$43.5 billion
— Total capital commitment plan for fiscal years 2010-2014.
$13.4 billion
— Record-high capital commitments in FY2010.
9 percent
— Average annual growth rate of debt service costs.
12 percent
— Projected share of the City's budget that debt service will constitute by 2014.
New York City should adhere to GASB Statement No. 49 regarding pollution remediation obligations, ensuring that any requested deferrals are strictly temporary and limited to one year. The City must prioritize these expenditures within its budget process rather than seeking long-term exemptions from established accounting standards.
Recommendations related to Capital Planning
The Board should make clear on the public record that any deferral of GASB Statement No. 49 will be temporary, with no intention to grant permanent or long-term exemptions.
The Financial Control Board should support the application of all current GAAP requirements.
Any deferral granted for compliance with GASB 49 should be as brief as is necessary and practical, specifically limited to one year.
The City and the Financial Control Board should continue to accept the GASB rules as the basis for defining a balanced budget.
The City should use its budget process to address the difficult tradeoffs among multiple services, ensuring that remediation expenditures are treated as a priority in budget debates.
Key Data
July 1, 2008
— The date GASB Statement No. 49 became effective for the City.
July 1, 2009
— The target date for the City to achieve reasonable compliance with GASB 49.
December 2006
— The date GASB Statement No. 49 was promulgated.
New York City's capital program, which has reached record-high commitments, should be scaled back to reduce debt service costs now that the economic expansion has ended. Future capital projects should be limited to essential infrastructure like roads and bridges, and only pursued if credible economic analysis demonstrates a clear return on investment or improved service delivery.
Recommendations related to Capital Planning
The Council should downsize the capital program to lower debt service costs.
The ambition of the capital agenda should be scaled back.
The plan should preserve key priorities – such as repair of roads, bridges, water mains and sewer pipes – and limit non-essential items.
Neighborhood revitalization and development projects should only be pursued if there is credible economic analysis showing that the City will receive a return on its investment or improved service delivery by undertaking the project.
Key Data
$6.2 billion to $8.7 billion
— The projected increase in debt service costs.
9 percent
— The average annual rate at which debt service is increasing.
$13.4 billion
— The record high level of capital commitments for the current year.
$10 billion
— The total capital commitments projected for fiscal year 2011.
$43.5 billion
— The total capital commitment plan for fiscal years 2010-2014.
$700 million
— The increase in the capital plan compared to the version released in January.
New York City committed over $63 billion to capital projects between fiscal years 2002 and 2009, significantly expanding the value of city-owned assets like schools and parks. Despite this record investment, a substantial funding gap persists for maintaining existing infrastructure, with nearly half of the necessary repairs to reach a state of good repair remaining unfunded.
Key Data
$63.4 Billion
— Total capital commitments made by New York City from fiscal year 2002 through the end of fiscal year 2009.
$5.6 Billion
— Amount of capital work needed to bring surveyed City assets to a state of good repair, according to the fiscal year 2011 AIMS report.
49 percent
— The portion of necessary capital work that remains unfunded, representing the current funding gap for AIMS requirements.
50 percent
— The increase in the value of assets owned by New York City and its related authorities since 2002.
New York City's debt service costs are rising rapidly due to an expanding capital program, necessitating a reduction in capital spending to align with fiscal constraints. To control these liabilities, the city should apply the same belt-tightening measures used for the operating budget to the capital budget, prioritizing essential infrastructure repairs over non-essential economic development projects.
Recommendations related to Capital Planning
A downsized capital program will be necessary if the Mayor is serious about restraining debt service growth.
The same belt-tightening that has occurred with the operating budget should apply to the capital budget, as well.
Cuts should be made starting in fiscal year 2011, and should be made with an eye toward abandoning non-essential items, including over $1.0 billion in economic development projects, and preserving key priorities such as repairs of essential infrastructure like roads, bridges, water mains and sewer pipes.
Smarter, more targeted investment will also produce real savings in debt service by the end of the Mayor's term.
Key Data
$5.2 billion
— Debt service total in the current fiscal year.
$36.3 billion
— Updated capital commitment plan for fiscal years 2010-2013.
$14.5 billion
— Expected capital commitments in fiscal year 2010.
$24.8 billion
— Capital commitments for fiscal years 2002 to 2005.
$38.6 billion
— Capital commitments for fiscal years 2006 to 2009.
12.4 percent
— Portion of all city-funded spending that debt service accounts for in the current fiscal year.
The MTA's proposed 2010-2014 capital plan outlines $28 billion in investments but identifies only $18 billion in funding, leaving a $10 billion gap. The plan suffers from transparency issues, management delays, and a failure to prioritize critical infrastructure repairs, necessitating a more pragmatic, needs-based approach to capital planning.
Recommendations related to Capital Planning
New reporting requirements mandated by the Legislature should be implemented.
The MTA should commit to greater transparency in informing the public about the status of its capital projects.
This capital plan should be implemented in tandem with an improved information management system for tracking capital projects that provides clear and consistent benchmarks.
The MTA should improve its capacity to manage mega-projects and improvements in signaling and communications systems.
The capital program should be amended using a pragmatic approach: the size of the plan should be downsized to reflect a realistic assessment of what can be accomplished.
Planning for the capital plan should be tied more directly to the needs assessment, and priorities should be altered in favor of achieving a state of good repair.
The composition of the plan should be tied more directly to an unconstrained needs assessment (which the MTA should publish).
Repair of critical infrastructure should be accelerated to the extent possible.
More funds can and should be raised from the farebox and from auto-users to support the capital program and operating needs.
Key Data
$28 billion
— Total investments outlined in the proposed 2010-2014 MTA capital plan.
$18 billion
— Total funding sources identified for the proposed 2010-2014 MTA capital plan.
$10 billion
— Funding gap existing for the full five-year period of the capital plan.
$130 billion
— Adjusted needs estimate for the 20-year period.
24 percent
— Cost of the South Ferry Terminal project above the initial estimate.
90 percent
— Cost of the Fulton Street Transit Center project above the initial estimate.
New York City must prioritize a smarter capital budget by focusing on the maintenance of essential infrastructure like sewers, roads, bridges, and schools while sacrificing less essential economic development projects. To ensure long-term fiscal health, the city needs to borrow less and reduce the debt service that is projected to consume 9 percent of the budget by 2013.
Recommendations related to Capital Planning
The City should continue to invest in the maintenance of sewers, roads, bridges and schools.
Current capital plans for less essential undertakings, such as poorly justified economic development projects, will have to be sacrificed.
The City should adopt a smarter, rather than bigger, capital budget that focuses on better use and maintenance of existing assets rather than ambitious plans for expansion.
The City needs to borrow less money and reduce the amount of debt service paid out of its operating budget.
Key Data
$6.5 billion
— Projected interest on the debt by 2013.
9 percent
— The portion of the budget that interest on the debt will represent by 2013.
The Metropolitan Transportation Authority's capital planning process lacks transparency and realism, resulting in significant project delays and cost overruns that often exceed initial estimates. To improve accountability, the agency must adopt a more rigorous, data-driven approach to project management and base future five-year plans on realistic assessments of what can actually be accomplished.
Recommendations related to Capital Planning
The MTA should commit to an improved management information system for tracking capital projects and to greater transparency in informing the public about the status of its capital projects.
The MTA should improve its capacity to manage mega-projects and improvements in signaling and communications systems, as these are the areas of greatest delays and cost increases.
The next five-year plan should be based on a realistic assessment of what can be accomplished, rather than overly ambitious projections that lead to projects being deferred or dropped.
Key Data
$18.6 billion
— Combined cost of 798 capital projects examined by the MTA for the three-year period from January 2005 to December 2007.
90 percent
— Cost increase of the Fulton Street Transit Center relative to its initial estimate.
24 percent
— Cost increase of the South Ferry terminal relative to its initial estimate.
35 percent
— Cost increase of the Automatic Train Supervision project relative to what was budgeted at award.
51 percent
— Cost increase of computer based train control on the Canarsie Line.
$28.1 billion
— Proposed total commitments for the 2010-2014 MTA capital plan.
The Metropolitan Transportation Authority faces a significant funding shortfall for its 2010-2014 capital plan, with identified funding covering only a fraction of the $28.1 billion required. To address these challenges, the agency must improve its project planning and implementation capabilities while adopting a more sustainable funding model for system repairs and expansions.
Recommendations related to Capital Planning
State taxes should underwrite the needs that arise from bad policy decisions made by the MTA and state officials in the past to bring the system to a state of good repair.
The 50-25-25 approach should be the basis for regular repair and replacement of facilities, with spending handled on a pay-as-you-go basis or the debt service for any associated borrowing being raised from that mix of sources.
Projects for system expansion should utilize innovations such as tax-increment financing or follow the 50-25-25 funding approach.
MTA leaders should give greater attention to improved planning and implementation as they continue to develop the next five-year capital plan.
The MTA needs to demonstrate a greater ability to implement the capital projects that are approved and financed.
Key Data
$28.1 billion
— Total investment called for in the preliminary 2010-2014 capital plan.
$18.2 billion
— Identified funding sources for the 2010-2014 capital plan.
25 percent
— Portion of work in the 2005-2009 capital plan that may not be started by the end of the period.
New York City's capital budget has grown significantly, with commitments reaching a record $13 billion in 2009 compared to $5.8 billion in 2003, leading to a projected 42 percent increase in debt service costs. To address this, the city should prioritize maintaining existing assets over new non-essential initiatives and eliminate expansion projects lacking clear economic benefits to achieve at least $100 million in annual debt service savings.
Recommendations related to Capital Planning
The capital budget should be better targeted to keeping existing assets in a state of good repair.
New initiatives in non-essential areas, such as those for economic development, neighborhood revitalization and even some new school construction, should be postponed or curbed.
The City should re-examine and eliminate expansion projects that do not have clearly demonstrated economic benefits.
The minimum goal should be $100 million in annual debt service savings starting in fiscal year 2011.
Key Data
$5.8 billion
— Capital commitments in fiscal year 2003.
$13 billion
— Record level of capital commitments reached in 2009.
42 percent
— Projected growth in debt service over the next four years.
$100 million
— Minimum goal for annual debt service savings starting in fiscal year 2011.
Public-private partnerships offer a viable mechanism for infrastructure delivery by leveraging private sector expertise to improve design, construction, and long-term maintenance of public assets. To be effective, these arrangements should prioritize life-cycle efficiency and avoid using up-front payments for short-term budgetary relief.
Recommendations related to Capital Planning
PPPs should be focused on achieving efficiencies in the life-cycle costs of facilities and ensuring their long-term maintenance at standards higher than typically achieved by direct public-sector operation.
PPPs are well-suited to revenue-generating facilities, but user fees are not essential for a PPP.
PPPs need not be limited to large facilities; smaller assets can work as well when several similar assets are grouped together for a partnership with a single private partner.
New York’s leaders should focus on assets that are in poor condition and have a history of poor maintenance.
Large up-front payments should be avoided, as the temptations to use the proceeds for political expedient purposes or short-term budgetary balance, rather than for infrastructure investment, are too great.
The public sector does not abdicate its responsibilities with a PPP; rather, these partnerships demand enhanced its management capacity – particularly with respect to contract negation, design of performance outcomes and monitoring – in order to be successful.
Key Data
$1.8 billion
— The contract value to build the Airtrain from Kennedy Airport to the Jamaica Station of the Long Island Rail Road.
Public-private partnerships can serve as a valuable tool for improving New York's infrastructure management by focusing on life-cycle costs and maintenance, provided they are employed selectively and cautiously. New York should explore applying these partnerships to assets like highway bridges, school buildings, parks, and higher education facilities, while ensuring the public sector enhances its management capacity to oversee these complex agreements.
Recommendations related to Capital Planning
PPPs should be focused on achieving efficiencies in the life cycle costs of facilities and ensuring their long-term maintenance at standards higher than typically achieved by direct public sector operation.
PPPs are well-suited to revenue-generating facilities, but user fees are not essential for a PPP.
PPPs need not be limited to large facilities; smaller assets can work, as well.
New York’s leaders should give high priority to assets that are currently in poor condition and have a history of poor maintenance.
The public sector must enhance its management capacity in order for PPPs to be successful.
Key Data
$1.6 trillion
— Estimated investment necessary in the next five years to bring the nation’s infrastructure to a good condition.
$3.2 billion
— Critical maintenance backlog identified for the City University of New York system.
$1.7 billion
— Critical maintenance backlog identified for the State University of New York system.
$10.1 billion
— Funding needed over 12 years to address all critical dams.
$220 billion
— Minimum annual investment needed through 2035 to maintain and improve all modes of surface transportation.
$509 billion
— Total value of 1,109 public-private partnership projects launched globally between 1985 and 2007.
Developing a comprehensive capital plan is a key strategy to improve spending discipline and achieve fiscal efficiency. This initiative is projected to generate $96 million in annual savings by the third year.
Recommendations related to Capital Planning
The state should develop a comprehensive capital plan to help provide greater spending discipline.
Key Data
$96 million
— Projected annual savings by the third year from developing a comprehensive capital plan to help provide greater spending discipline.
The City should adhere to Generally Accepted Accounting Principles regarding GASB 49, ensuring that remediation expenses are not financed through long-term borrowing as they do not create useful assets. While a brief, one-year delay for compliance may be necessary due to information gaps, the City must prioritize these expenditures within its budget process rather than seeking permanent exemptions.
Recommendations related to Capital Planning
The Financial Control Board should make clear on the public record that any deferral of GASB 49 compliance will be temporary and that there is no intention to grant permanent or long-term exemptions.
Any deferral granted for GASB 49 compliance should be as brief as is necessary and practical, specifically limited to one year.
The City should use its budget process to address the difficult tradeoffs among multiple services to taxpayers, and the affected remediation expenditures should be one of the priorities addressed in budget debates.
The City and the Financial Control Board should continue to accept the best available standard, the GASB rules, as the basis for defining a balanced budget.
Remediation expenses affected by GASB 49 do not create a useful asset and should not be financed with long-term borrowing.
A Panel Discussion A forum discussion on the efficacy of New York City's infrastructure plan and what steps it should take to ensure that current infrastructure is kept in a state of good repair. Mayor Michael Bloomberg delivers the keynote speech and CBC President Carol Kellermann gives the presentation on…
The Metropolitan Transportation Authority faces significant financial challenges, including an operating deficit of nearly $4 billion and a five-year capital plan that requires billions more than currently available. To address these fiscal pressures, the agency is moving toward regular, predictable fare increases rather than large, periodic adjustments.
Recommendations related to Capital Planning
Future fare increases should be linked to the cost of a ride rather than to inflation.
Key Data
$3.1 billion
— The MTA's projected operating deficit in 2007.
$4 billion
— The MTA's projected operating deficit for the following year.
$4.3 billion
— The state's projected funding gap in the coming fiscal year.
$222 million
— The amount of cash the MTA had on hand at the time of the report.
New York City's capital planning requires a long-term, strategic approach that prioritizes maintaining the city's $60.5 billion in assets in a state of good repair over funding new expansion projects. The city should shift from reactive repairs to regular replacement cycles funded by operating revenues and ensure that the $23 billion in planned expansion projects are justified by rigorous economic analysis.
Recommendations related to Capital Planning
The City should institutionalize and expand the PlaNYC approach to ensure long-term strategic planning for capital assets.
The City should develop a systematic plan for bringing all City-owned assets to a state of good repair by expanding the Asset Information Management System (AIMS) to cover all capital assets.
The City should place all its capital assets on regular replacement cycles according to their useful lives and fund their replacement with operating revenues.
The City should pursue expansion projects based on clearly explained priorities and data demonstrating benefits that will accrue to the City.
Key Data
$83.7 billion
— Total planned capital investments over the next ten years.
$23 billion
— Total planned expansion projects for the next ten years.
$60.5 billion
— Total value of City-controlled capital assets.
$3.0 billion
— Depreciation of the City's major assets based on historical cost in fiscal year 2007.
$4.9 billion
— Estimated depreciation of the City's major assets based on replacement cost.
New York State lacks a centralized, strategic approach to capital planning, resulting in ad hoc budgeting that fails to prioritize needs or evaluate trade-offs effectively. Implementing a comprehensive capital plan could generate significant savings, with a 10 percent reduction in the capital budget potentially yielding $1 billion in annual savings on capital outlays and $100 million in avoided debt service.
Recommendations related to Capital Planning
The State should develop a comprehensive capital plan to replace the current ad hoc process and allow for strategic capital asset management.
State leaders should shave 10 percent off the capital budget to generate $1 billion per year in avoided capital outlays and $100 million per year in avoided debt service.
Key Data
$138.8 billion
— Total value of capital assets and infrastructure owned by the State and its public authorities.
$10 billion
— Capital spending for which the State pays debt service in fiscal year 2007-08.
$4.9 billion
— Capital spending for which the State paid debt service in fiscal year 2004-05.
$1 billion
— Estimated annual savings in avoided capital outlays from a 10 percent reduction in the capital budget.
$100 million
— Estimated annual savings in avoided debt service from a 10 percent reduction in the capital budget.
New York City's park system has expanded significantly, yet it faces ongoing challenges in maintaining facilities and ensuring equitable resource distribution across all neighborhoods. To address these issues, the city should implement strategic planning, shift routine maintenance costs to the operating budget, and create financial incentives to increase earned revenue from concessions.
Recommendations related to Capital Planning
Create a stronger incentive for increasing concession and other earned revenues by dividing growth in these revenues between the City’s general fund and a new fund dedicated to parks improvements.
Institutionalize responsibility for strategic planning for parks by establishing an entity within municipal government with a clear mandate from City Hall.
Bring all parks to an acceptable condition by creating a strategic plan that includes a timetable for facility improvements and targets new resources to parks with the greatest need.
Improve the quality and productivity in parks maintenance and operations by establishing measures of park use and unit costs, and experimenting with contracting-out.
Encourage preventive maintenance and longer periods of usefulness by funding routine repairs and replacements in the operating budget rather than the capital budget.
Common principles should guide the relationships between the DPR and its nonprofit partner organizations to ensure transparency and consistent policies regarding philanthropic support and concession revenues.
Key Data
$394 million
— Amount needed to bring major DPR assets to a state of good repair in the latest fiscal year.
$780 million
— Total City funds provided for DPR facilities in fiscal year 2006.
$81 million
— Total revenue generated by the DPR in fiscal year 2006.
$63 million
— Net amount devoted by conservancies to services in the parks annually.
$48.1 million
— Concession revenue generated in fiscal year 2006.
$246 million
— Capital expenditures for DPR facilities in fiscal year 2006.
New York State faces a mandate to spend billions on operating aid and capital improvements for public schools, requiring a strategy that balances revenue generation with economic competitiveness. Strategies to manage these costs include eliminating system inefficiencies, broadening the tax base, and reducing new school construction expenses through year-round education and rezoning.
Recommendations related to Capital Planning
The state should pursue year-round education to better utilize existing capacity and increase the number of children that any school building can accommodate.
Schools should be rezoned to reflect shifts in population to alleviate overcrowding and reduce the costs of new school construction.
Key Data
$9.2 Billion
— Mandated capital improvements for New York City public schools over the next four to five years.
$750 Million
— Potential savings if the state eliminated or reduced aid to wealthy districts with a tax base large enough to generate the full cost of a sound basic education.
$500 Million
— Potential savings from correcting inefficiencies related to teacher contracts and consolidating small school districts.
New York's state debt has reached a historic $50 billion, with 20 percent of that debt used to cover operating deficits rather than capital investments. To address this, the state should integrate authority borrowing into the capital plan and implement stricter financial reviews to curb runaway debt growth.
Recommendations related to Capital Planning
Stop issuing state-funded debt to cover operating deficits.
Make authorities' borrowing part of the state's capital plan.
Institutionalize rigorous financial review of authority borrowing.
Reduce future debt for capital spending.
Key Data
$50 billion
— State debt hit this historic amount during the fiscal year ending March 31, 2007.
20 percent
— Portion of state debt that has gone to cover operating costs.
$4 billion
— Amount of debt added in the past year.
$2,700
— Per-capita debt amount for every man, woman, and child in the state.
$2.2 billion
— Cash surplus the state ended with in the year debt was added.
New York State's fiscal health is hindered by excessive debt, much of which is used for operating expenses rather than long-term capital projects, and a lack of coordination between public authority borrowing and the state's capital plan. To improve fiscal stability, the state should prioritize pay-as-you-go financing, integrate public authority borrowing into the capital plan, and subject such borrowing to more rigorous financial review.
Recommendations related to Capital Planning
Discontinue issuance of State-funded debt to cover operating deficits.
Integrate public authorities’ proposed borrowing for capital investments with the State’s capital plan in order to prevent inefficient use of borrowing capacity.
Subject public authority borrowing to more rigorous financial review by an enhanced Public Authorities Control Board or by the Division of Budget.
Reduce the State’s future debt by lowering capital spending and/or increasing pay-as-you-go financing.
Key Data
$105.8 billion
— Estimated total debt outstanding for the State and its authorities at the end of fiscal year 2004–05.
$44.8 billion
— Amount of debt backed by State revenues, representing 42 percent of the total debt outstanding.
$30.4 billion
— Amount of debt borrowed by authorities and backed by project revenues.
$11.5 billion
— Amount of outstanding State-supported debt used to pay for operating expenses, representing 21 percent of that total.
40 percent
— Average share of capital spending financed on a pay-as-you-go basis in the current capital plan.
54 percent
— Share of capital spending financed on a pay-as-you-go basis in fiscal year 1996.
New York's public authority debt has reached $166 billion, with authorities often bypassing voter approval and lacking sufficient oversight for capital projects. To address this, the state should implement constitutional debt limits, require voter approval for authority borrowing, and mandate a comprehensive, multi-year capital plan to ensure project feasibility and transparency.
Recommendations related to Capital Planning
The state should adopt a new constitutional limit that would apply to all state-supported debt, including any issued by authorities.
The governor and budget director should be responsible for preparing a comprehensive, multi-year capital plan that includes state agencies and authorities.
The governor and budget director should be responsible for timely and transparent analyses of the feasibility of state authority projects.
Industrial-development authorities should select among private parties based on criteria established in advance and in response to competitive proposals.
The Public Authorities Control Board, which was created to provide such analyses, has not been doing the job adequately and ought to be abolished.
Key Data
$166 billion
— Total outstanding debt of New York's public authorities.
$227 billion
— Total outstanding debt issued by New York state and local governments and their authorities.
583
— Total number of public authorities in New York.
$4 billion
— Amount of 'back door' debt, representing 9 percent of the $45 billion in current state-supported debt.
$56 billion
— Total amount of private-conduit debt.
New York State's extensive reliance on public authorities has led to significant issues, including the misuse of debt powers to circumvent constitutional limits and a lack of coordination between authority projects and state capital planning. To address these problems, the state should implement comprehensive debt limits, integrate authority capital investments into broader state and local capital plans, and enhance the transparency and governance of authority boards.
Recommendations related to Capital Planning
Eliminate the misuse of authorities’ debt powers by setting comprehensive constitutional limits on the amount of State-supported and City-supported debt that can be issued by the State of New York and by the City of New York.
Improve the oversight of non-State-funded authority debt by replacing the PACB review process with more comprehensive capital planning and project feasibility studies subject to professional, transparent review.
Improve the effective use of tax-exempt conduit debt by requiring more explicit advance allocation of its purposes and more competition among private entities for its benefits.
Make authorities more accountable through more complete and accessible reporting of financial and other information.
Enhance the governance of authorities through greater independence and professionalism among board members.
Key Data
$227 billion
— Estimated total amount borrowed by state and local governments and their authorities in New York.
$41 billion
— Amount of outstanding backdoor debt issued by authorities on behalf of the State that did not follow the constitutional procedure requiring voter approval.
$10 billion
— Amount by which State-supported debt in 2003 exceeded the State’s danger-zone threshold.
$43.1 billion
— Applicable constitutional debt limit for New York City at the end of fiscal year 2004.
$52.2 billion
— Actual City-funded debt for New York City at the end of fiscal year 2004.
$8.5 billion
— Annual operating expenses of the Metropolitan Transportation Authority, the largest authority accountable to the State.
New York State's excessive debt, driven by "backdoor" borrowing and a lack of effective constitutional limits, threatens its economic future and requires immediate reform. The state must reject further excessive borrowing, such as the Transportation Bond Act of 2005, and implement a new constitutional limit that ties debt issuance to affordability and restricts funds to true capital investments.
Recommendations related to Capital Planning
Voters should reject bond referendums such as the Transportation Bond Act of 2005 until debt is brought under control.
The State must strike a balance between adequate infrastructure investment and a competitive debt burden.
The State should establish a new debt limit based on the concept of affordability as determined by an independent Debt Policy Committee.
The State should apply the limit to all forms of state-backed debt, including such bonds issued by authorities.
The State should eliminate the need for voter approval within that limit.
The State should restrict the use of borrowed funds to true capital investments.
Key Data
$46.7 billion
— Total outstanding state-funded debt in New York State.
$43.0 billion
— Amount of "backdoor" borrowing that does not require voter approval.
$11.5 billion
— Amount of backdoor borrowing used to underwrite annual operating deficits instead of capital projects.
$2.9 billion
— Amount of borrowing authorized by the Transportation Bond Act of 2005.
$19 billion
— Amount of new debt planned in the state's current five-year plan.
$13 billion
— Additional planned State borrowing beyond the Transportation Bond Act of 2005.
New York City's rising debt service costs, driven by increased capital spending, necessitate a strategic shift toward paying off existing debt and reducing construction inefficiencies. By repealing or exempting projects from the Wicks Law and utilizing operating surpluses to pay down debt, the City can alleviate the burden on future budgets and avoid unnecessary interest payments.
Recommendations related to Capital Planning
The City should reduce its capital budget and pay off debt on its own to lower future debt service costs.
The City should advocate for the repeal of, or exemption of more projects from, the State’s Wicks Law to reduce construction costs.
The City should use the large operating surplus accumulated in fiscal year 2005 to pay off outstanding debt rather than using it to support recurring expenses.
Key Data
$290 million
— Annual savings in fiscal year 2009 from debt service reduction.
$9.1 billion
— Average annual capital spending for fiscal years 2005 to 2008.
$6.0 billion
— Average annual capital spending for the four-year period prior to 2005.
$3 billion
— Estimated surplus for the year that could be used to pay off outstanding debt.
$2.0 billion
— Amount of deficit financing added to the City's debt after September 11th, 2001.
10 percent
— Estimated increase to the City's capital costs for projects affected by the Wicks Law.
New York City public schools face significant overcrowding, with the Campaign for Fiscal Equity proposing a $14.7 billion capital program primarily focused on new construction. Instead of relying solely on expensive new building projects, the city should implement rezoning and year-round education to more efficiently utilize existing capacity and provide necessary space for students.
Recommendations related to Capital Planning
New zoning policies should be adopted to alleviate crowding and create additional capacity.
The city should implement year-round education to increase school capacity by spreading the 180 required school days over the entire calendar year.
Rezoning would have to be accompanied by some reconfiguration of grades within schools to effectively manage enrollment.
The Court should not dismiss policy options that use existing facilities wisely, thereby promptly providing children a seat in a structurally sound and well-equipped school without the delays or costs that accompany new construction.
Key Data
$14.7 billion
— Total capital needs to provide New York City students with the facilities needed for a sound basic education.
$12.3 billion
— Total cost allocated for new construction within the capital needs estimate.
136,430
— Number of unused seats at under-utilized schools citywide.
64,231
— Number of excess students enrolled at crowded schools.
1,268,574
— Total capacity available for enrollment after implementing year-round education and rezoning.
New York City can address its school overcrowding and capital needs by rezoning existing schools and implementing year-round education schedules, which would create capacity for over 1.2 million students. These strategies offer a more efficient and timely alternative to the $14.7 billion in new construction costs identified by the Campaign for Fiscal Equity.
Recommendations related to Capital Planning
The classroom space requirements for a sound basic education can be met in a timely, efficient and effective manner through a combination of two measures - redistricting of existing schools and operating existing schools on a year-round schedule.
The City should adopt new zoning policies, as the unused capacity at under-utilized schools far exceeds the excess enrollment at the crowded schools, allowing for the alleviation of crowding and the creation of additional capacity for smaller class sizes.
The Court should not dismiss policy options that use existing facilities wisely, thereby promptly providing children a seat in a structurally sound and well-equipped school without the delays or costs that accompany new construction.
To achieve the outcome of alleviating crowding, rezoning would have to be accompanied by some reconfiguration of grades within schools, such as shifting some ninth grade students now in high schools to middle schools.
Implementing schedule changes on a district-wide basis should be pursued to reduce the difficulties in coordinating vacation and child care faced by families with children in different schools.
Key Data
$14.7 Billion
— Estimated capital needs in 2003 dollars to provide New York City students with the facilities needed for a sound basic education.
136,430
— Number of seats available as unused capacity at under-utilized schools.
64,231
— Number of students representing excess enrollment at crowded schools.
1,268,574
— Total capacity available for enrollment after implementing year-round education and rezoning.
1,225,145
— Estimated number of students requiring space to meet needs for alleviating current crowding, accommodating smaller class size, and expanding pre-kindergarten enrollment.
17,000
— Number of seats in transportable buildings that would be closed down under the year-round education plan.
The New York-New Jersey region's transportation system suffers from inadequate maintenance and a lack of comprehensive planning, requiring a shift toward a public enterprise model that relies on dedicated user fees and predictable subsidies. To ensure long-term viability, the region must establish a centralized policy board to set priorities and accelerate the elimination of the existing maintenance backlog through dedicated funding.
Recommendations related to Capital Planning
The governors of New York and New Jersey should create a new entity with authority to set and enforce regional transportation policies and priorities.
The region’s transportation agencies should have sufficient resources to meet all necessary operating expenses.
Motor vehicle user fees should be dedicated to transportation agencies for two purposes: to cover the operating costs of roads and bridges, and to cover one-quarter of the operating costs of mass transit.
Mass transit riders should pay a fare sufficient to cover one-half the transit agencies’ operating costs.
The existing backlog in maintenance and repairs caused by a history of under-funding and neglect should be eliminated at an accelerated pace and be financed by general fund appropriations.
Key Data
$13 billion
— Combined annual operating expenditures of the 25 transportation agencies in the region.
39 percent
— Percentage of urban roads in New York in unacceptable condition.
37 percent
— Percentage of bridges in both New York and New Jersey that are structurally deficient or obsolete.
$1.2 billion
— Total mass transit operating deficit in 2001.
$5.7 billion
— Total user fees collected from auto users in the region in 2001.
$4.0 billion
— Annual contributions to capital for transportation purposes in the region.
The City's five-year $36 billion capital plan could be significantly improved by intensifying the use of existing facilities, better maintaining assets, repealing the Wicks Law, and establishing borrowing limits. Additionally, the State's budget process has been criticized for delaying critical capital projects and failing to address long-term infrastructure needs.
Recommendations related to Capital Planning
The City should use existing facilities, such as schools, more intensively to better meet its capital needs.
The City should better maintain its assets to ensure the capital plan meets the City's considerable capital needs.
The City should work to repeal the burdensome Wicks Law to improve the effectiveness of the capital plan.
The City should set effective limits on borrowing to improve the capital plan.
Key Data
$36 billion
— The total value of the City's five-year capital plan.
8 percent
— The annual growth rate of debt service payments over the next four years.
New York State and New York City have accumulated significant debt to finance public infrastructure, often circumventing constitutional limits through various authorities. This report proposes a new, comparative approach to measuring debt affordability to establish binding, multiyear limits that ensure fiscal competitiveness while allowing for necessary capital investments.
Recommendations related to Capital Planning
New York State's elected leaders should bring the State's debt burden below the danger zone threshold identified in this report, and New York City's leaders should keep their debt below the relevant danger zone threshold.
New York City and New York State should create Debt Policy Committees to recommend long-run debt strategies and annual debt issuance limits.
The State Constitution should be amended to establish new limits on State and City debt.
New York State should develop a new plan to lower its outstanding debt.
The new limits should be made more sensible by replacing the existing constraints with an approach based on that developed in this report.
Key Data
$35.8 billion
— State debt at the end of the 1999 fiscal year.
$46.8 billion
— City debt at the end of the 1999 fiscal year.
$63.8 billion
— Total non-State-supported authority debt at the end of 1998.
$26.9 billion
— Amount of appropriation-backed debt in the form of lease or other contractual agreements.
$1.2 billion
— Total cost of higher interest rates on outstanding appropriation-backed debt over 30 years.
$43.0 billion
— Projected State-supported outstanding debt in fiscal year 2005.
New York's transportation infrastructure requires significant investment to reach a state of good repair, with the City Comptroller identifying a $4 billion gap for highways and a $10.7 billion gap for mass transit. Leaders must balance these critical maintenance needs with initiatives to expand capacity, such as new rail lines and modernized signaling systems, to maintain the region's economic competitiveness.
Recommendations related to Capital Planning
New York’s leaders should address how to improve transit system efficiency and ridership.
New York’s leaders should address how rapidly to achieve a state of good repair for the existing infrastructure.
New York’s leaders should address how much new mass transit capacity is necessary.
An initiative aimed at identifying modern human resource measures could help enhance New York’s future competitiveness.
Experiments with higher fares at the busiest time could identify effective ways to shift some ridership to the less crowded hours.
Key Data
$12.2 billion
— Estimated funding needed for New York City highways over the ten-year period spanning fiscal years 1998 to 2007.
$8.1 billion
— Amount allocated by the City for New York City highways over the ten-year period spanning fiscal years 1998 to 2007.
$20.4 billion
— Estimated funding needed to achieve and maintain a state of good repair for facilities operated by the Transit Authority.
$9.7 billion
— The portion of the $10.7 billion gap in mass transit capital budget categories accounted for by line structures, signals, line equipment, and stations and communications.
30 to 40
— Potential increase in the number of rush hour trains on New York City’s busiest subway lines if modern signaling and train control systems are achieved.
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