370 Jay Street. Source: Google Maps

THE COMMUTE: In New York, MTA means Metropolitan Transportation Authority. In the 1970s and 80s, critics claimed it really meant “More Trouble Ahead” with frequent announcements of projects coming in over budget and behind schedule. In the years since, little has changed. More recently, we have been plagued with: fare and toll hikes, service cutbacks, and the state stealing money from the MTA.

In The Commute, I have highlighted where the MTA has not spent its limited funds wisely:

Expensive projects, such as East Side Access and the Fulton Transit Center, have also had its critics wondering if the work scope could be narrowed, thus enabling the work completed to be quicker and at lower costs. Former MTA Chairman Jay Walder was the first to admit that perhaps the MTA is not as efficient as it can be. He took steps to streamline administrative expenses instead of merely looking toward the fare, more borrowing and service cuts to plug the MTA’s budget problems. His motto was “making every dollar count.” He also pledged more accountability. Current MTA Chairman Joe Lhota claims to be continuing where Walder left off when he broke his contract last year, and hastily departed for more lucrative employment in the Far East.

Visa Debacle

Now the New York Daily News revealed another way in which taxpayers have been ripped off. Since 2005, the MTA has lost $16 million as they and Visa quibbled about expanding an upgrade at MetroCard vending machines to thwart credit card fraudsters. Neither the MTA nor Visa considered the amounts of money lost significant enough to be concerned about. The logic was that the amounts, with the exception of the LIRR, did not exceed one percent of annual sales revenue, the industry standard to determine if there is indeed a problem.

“Money Thrown Away”

Now with contract negotiations underway, TWU Local 100 is challenging MTA’s claims that it is trying its best to be efficient. The union claims MTA really stands for “Money Thrown Away.” On their website of the same name, they make a case for the MTA to break its lease at its 2 Broadway headquarters, which the MTA spent $100 million $845 million to renovate [corrected]. Instead, they should renovate their current headquarters on Madison Avenue, which it owns and plans to sell. They also propose the MTA reuse and renovate 370 Jay Street, which it leases from the city for $1 a year and abandoned years ago. Those moves would save the MTA $63 million per year in leasing costs for 2 Broadway, according to the union.

Local 100 believes the vast amount of money the MTA poured into 2 Broadway was unnecessary and an example of MTA waste. Let’s not be fooled, their motives are to show that if the MTA would be spending its money more efficiently, there would be more money for a better contract deal. Likewise they have also recently suggested the MTA rehire platform conductors to make crowded platforms safer. Is their prime concern really passenger safety or is it jobs availability for their members? Nevertheless, some of their arguments regarding office space are worth looking into further. They also insist that more work could be performed in-house at a lower cost rather than being contracted out.

The union also states the MTA can place more offices underground on unused subway mezzanines, offices they have been abandoning. It is difficult to determine if they are correct without talking about actual square footage available at each location, and hearing the MTA’s side. There are also other considerations. For example, would moving offices underground increase labor costs if frequent trips to headquarters are required? That was one of the reasons I criticized the location of the Howard Building. It required frequent travel to and from 370 Jay Street, wasting countless millions of dollars in labor costs during the 10 years that the building was leased, when a closer location — 345 Adams Street — was available.

Their argument regarding the need for a new MTA central revenue facility in Maspeth, at a cost of $300 million to build, neglects to mention that the facility is not only the revenue facility for the subways and buses but also for the MTA’s E-Z Pass. Again, we are not hearing the complete story or the MTA’s side. The shift from tokens and coins to credit and paper currency may have reduced the feasibility of continuing to collect revenue using money trains or there may be other factors whereby one central MTA facility is more efficient.

The Fate Of 370 Jay

The real estate issues now are:

  1. What will be the fate of 370 Jay Street and the current headquarters on Madison Avenue and
  2. If the properties are disposed of, will the deals made be in the best interests of the public. Or will the real estate industry, which the MTA has close ties with, benefit the most from the sales?

Will the public get screwed again, as many think happened when the MTA disposed of its air rights over Atlantic and Hudson Yards? Will the city give away 370 Jay Street to a privately owned NYU, as Mayor Bloomberg is contemplating? There is also talk of the MTA using the site for a combined MTA Business Service Center to handle all payroll for all MTA agencies. If so, would that function utilize all 13 floors? Remember that was the entire space New York City Transit Authority occupied for 15 years (excluding field offices) prior to the creation of the MTA.

Next week: My personal observations of waste at the MTA.

The Commute is a weekly feature highlighting news and information about the city’s mass transit system and transportation infrastructure. It is written by Allan Rosen, a Manhattan Beach resident and former Director of MTA/NYC Transit Bus Planning (1981).

Correction (2:34 p.m.): The original version of this article originally stated that the MTA spent $100 million to renovate its 2 Broadway headquarters. The actual amount spent was $845 million. We regret any confusion this may have caused.

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  • NI51965

    For the last 30 years,the MTA has been spending a lot of money,on cosmetic work,to beutify the subway system. Not necesarily improving it. The train system was designed,to move people fast and cheap.For instance,how much money,was spent to cover up perfectly good cement floors on the under ground station platforms,with tiles? The transit union is not the good guy either. They some how,got the city to give them an overly generous pay increase a few years ago,that the MTA could not afford to pay.And resulted in lay offs.

    • Allan Rosen

      You express a viewpoint held by many, that the system should just be functional and that’s it. That art has no place in the subways and making the stations a little nicer looking is wrong. I’m not sure I agree with that.

      If the art is not vandalized and doesn’t increase the cost of upkeep, I don’t have a problem with that. But I do have a problem with tile floors that start crumbling after only ten years and fixed with cement patches and non-matching tile. That doesn’t make the floors look any prettier. The floors try started installing recently looks as if they will hold and do look better tan the concrete. Let’s hope they last.

  • Tinman

    More Tainted Assets

  • Saurez

    Actually the site says that the TA should move back to the 2 buildings they basically own in Brooklyn which is 370 Jay St and 130 Livingston which is also mostly empty.  The MTA has already done a 25 year lease for the new Business Service Center at 333 W. 34th St. so they can’t move that to Jay St.  The site also says that the field managers should be back in the subway station locations with their workers as they were for the 1st 100 years of the transit system.

    • Allan Rosen

      I don’t believe Livingston is mostly empty anymore. It had been underutilized for several years.

      • Saurez

        I work in the building and whole floors are just about empty.  There is so much unused space there it is maybe third being used.  10 years ago it was full.

        • Allan Rosen

          I remember it being emptied out to fill 2 Broadway, and then it filled up again.  You would know the conditions today better than me.  

  • Lenny

    While writing about the 2 Broadway renovation, you mention a figure of $100 million that the MTA paid to renovate this building. This is an understatement of the actual figures. The actual figure that the MTA spent to renovate this building, that they don’t own, is $845 million dollars. This information can be found in a link provided on the website; MTA=MoneyThrownAway.com. It is in the State Comptrollers report on the MTA budget dated 10/2004, issued while the renovations were still ongoing. As Stated by the State Comptrollers office, these renovations took place in an atmosphere of gross mismanagement and corruption that cost the taxpayers dearly.

    • Allan Rosen

      You are correct. I don’t know where I got the $100 million from. I will try to get that corrected.

  • amazed

    First of all, renovation cost at 2 Broadway were set by the MTA at 150 million as per their contract with the building owner. Court records stemming from subsequent corruption scandals show that they ballooned to 600 million. Secondly, the website suggest that MTA use 130 Livingston Plaza and 370 Jay St. as their central headquarters. Thus, hundreds of mid-level managers and supervisors would be sent  back to their underground offices, closer to their employees and the riding public. Thirdly, the TWU makes no secret that they believe that subleasing 2 Broadway and Retaining 370 Jay St. for their own use will save enough money to pay for a cost-of-living contract and stabilize the fare.

    • Allan Rosen

      As I stated, I’m not sure if relocating those managers back underground is the best choice. We first need to know the reasons for moving them out.

  • Psa188

    MTA actually means “Money Thrown Away.”

  • LLQBTT

    The 2 Broadway fiasco was rife with the standard corruption, Yankees tickets, big screen TVs, shady deals and ultimately the arrest of the MTA’s Head of Facilities at that time as well as the disgraced termination of his deputy.

    http://www.nytimes.com/2003/04/17/nyregion/2-mta-officials-fired-in-december-in-bribery-inquiry.html?pagewanted=all&src=pm

    • http://www.flickr.com/photos/lisanne001 Lisanne!

      It was the closest thing we’ve had to the “Tweed” Courthouse scandal in terms of its outrageousness and absurdity. The plumbing contract alone was unbelievably criminal in its setup.

      • http://www.flickr.com/photos/lisanne001 Lisanne!

        OTOH, when al the details of the City Time scandal come to light it will pale almost every single instance of project fraud that came before it.

      • Allan Rosen

        And I don’t think anyone even went to jail for it.  They just get dismissed. I wonder if hey are allowed to keep their pensions. And then its business as usual at the MTA until we hear the next bad news. 

        I wonder what the truth is regarding Anemone and Casales, if they were truly guilty or this was payback for exposing the 2 Broadway scandal which may have even gone higher.  They only caught two.  Doesn’t mean there weren’t more.

  • LLQBTT

    I think that the MTA needs to be abandoned.  There needs to be a different structure.  In a weird way, that kook in Nassau is not entirely wrong for wanting to ditch the MTA.  But control of the city’s buses and subways needs to return where it belongs, NYC.  OR, go the other way and create a true regional authority, with clear, undisputed lines of accountability and funding, to operate and unify ALL mass transit in the greater, tri-state metropolitan area.

    • Allan Rosen

      I tend to agree with your assessment.

  • Lenny

    This is a great story, finally someone is writing about the MTA’s wasteful practices. When will part 2 be coming out?

    • Allan Rosen

      Monday.  Probably 10 AM or Noon,

  • Pingback: What Does MTA Mean? Part 2 Of 3 | Sheepshead Bay News Blog

  • Pingback: What Does MTA Mean? Part 3 Of 3 | Sheepshead Bay News Blog

  • candide08

    M-oney T-hrown A-way

  • Pingback: MTA Gets Screwed In Real Estate Deal | Sheepshead Bay News Blog