January 2008
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Archive for January, 2008

Congestion Pricing Plan Approved; More Funding for Mass Transit

A commission appointed by Gov. Spitzer and the Assembly voted in favor of a slightly modified version of Bloomberg’s congestion pricing plan. According to the NYT City Room, “The plan produced by the commission was generally the same as the mayor’s original plan with a few differences. The mayor wanted the pricing zone to begin at 86th street, instead of 60th, and the original plan had fees for trips within the zone as well as for cars entering the area.” Now the plan must receive approval from the City Council, the Mayor, and the State Legislature. The money raised through the fees – estimated at $491 million annually – will be dedicated to improving the mass transit system. How about improving the subway connections at Penn Station?

McKim, Mead and White’s “Post-Modern Historical Society”

penn station service building historic photoMcKim, Mead, and White’s Penn Station Service Building (1910), at 242 W. 31st Street, was the heart and soul of the Penn RR’s operations. Today, with plans to reuse it for back operations, we can be cautiously optimistic about its future. The Service Building provided virtually all of the critical powering services to the original Penn Station, including electricity, heat, light, elevator hydraulics, compressed air, and refrigeration. Currently it is largely vacant (aside from an operations control room) and a bit dirty, but, with its pink granite façade and plain pilasters, one can see elements of its former neighbor. Christopher Gray of The New York Times said, “if cleaned, it could be a post-modern historical society or a crematorium.” According to Conquering Gotham, a history of the building of Penn Station by Jill Jonnes, Charles McKim was “aghast to learn about the siting of the station’s planned powerhouse. He protested to the PRR, ‘There can be no question that the construction of two steel chimneys of a height of 180 feet, in such close proximity to the terminal would strike a fatal blow at the new station.’” Little did he know that two steel chimneys were far from the greatest threat to Penn Station, McKim’s final major building. He never could have imagined that his service station would be the only survivor. penn station service building historic photo interiorThe Service Building is still unprotected, but the good news is that the Draft Scope for the Moynihan Station project indicates the Service Building “would be renovated and used for some portion of Amtrak and possibly New Jersey Transit (NJT) back-of-house operations to be facilitated via an underground pedestrian connection to the Penn Station Block.” The building has been determined eligible for New York City landmark designation and National Register listing. Despite the plans to reuse the structure we urge the LPC to act so that its survival is guaranteed.

Moynihan Designs “Later This Year?!?”

moynihan station front closeupThe Real Deal’s excellent recap of last night’s panel on the Far West Side contains this update on Moynihan Station:
“We are planning a large public roll-out on this project soon,” Empire State Development Corporation spokesperson Warner Johnston told The Real Deal, “but we are not planning to share designs until later this year.
What is a public roll-out of a $14 billion civic project and development without designs? As the New York Times recently editorialized, “If such negotiations must continue behind doors, that still does not mean the state and the developers can delay letting the public see detailed plans and proposals. Veteran commuters deserve some hope that the new Moynihan complex is not just another urban fantasy.” The story also quotes Anna Hayes Levin of Community Board 4 who “said that the public needs to see concepts for Moynihan Station before Hudson Yards can sensibly proceed.” Meanwhile, the Rail Yards Blog lists the big West Side projects and predicts: “Chances are high that these projects will shift, scale back, or possibly fall through completely. This development burst is in its infancy, so it’s crucial that the public stay informed and demand accountability in both the planning and funding of these major projects.” And it includes this quote from former MTA head Richard Ravitch:
Until Moynihan Station is resolved, there will be a serious impediment to development on the whole West Side.” Expansion of the station would promote natural growth of Midtown by adjacency, he explained, rather than starting with large commercial developments on 10th and 11th Avenues. He encouraged the MTA to hold off plans for the Rail Yards until Moynihan Station was settled.

Hudson Yards and “The Fate of the Far West Side”

google earth west side manhattan aerialYesterday, Crain’s reported that the MTA wants to lease the Hudson Yards site rather than sell it. On Monday the MTA sent out letters to the five teams outlining its preferred deal structure. Theresa Agovino reported:
“A source at one developer said the MTA was caving in to public pressure not to sell the property, which includes active MTA rail operations. But the MTA spokesman says that under a 99-year lease agreement the developer would still control the site…Still, the source at the developer said that the MTA is asking for a piece of the profits that will come from leasing the office and residential buildings that will be built on the site. He couldn’t say exactly how much it was requesting.”
Maintaining public ownership of the Hudson Yards site is in the public’s interest, but what is really needed is a coordinated plan – one that defines Moynihan Station as a catalyst – with more transparency about the public costs. At a panel discussion last night on the West Side at the Museum of the City of New York, former MTA chairman Richard Ravitch lambasted the lack of coordinated planning in the Hudson Yards area. According to Norman Oder at the Atlantic Yards Report, Ravitch “criticized the MTA for its ‘shortsighted’ desire for revenue” and stressed that public land was an important public resource. We filmed the panel – stay tuned for some video clips.

Why Moynihan Station Should Use Historic Tax Credits

Historic tax credits for the redevelopment of the Farley building could lighten the financial burden on New Yorkers by up to $250 million. But it’s unclear whether the developers and MSG are willing to preserve enough of the historic features, like the lobby’s ticket windows and the brick walls of the future train hall, to qualify. The MAS strongly supports the use of the federal rehabilitation tax credit in the redevelopment of McKim, Mead & White’s Farley Post Office, a city, state and national landmark, for two main reasons: First, adhering to the rehabilitation standards required to qualify for the tax credit will safeguard the Farley building’s historic fabric, including significant interior areas. Second, the tax credit would be a significant financial boost of Federal funding to the project – especially when faced with rising construction costs, tightening lending conditions, and the ever present danger of “unexpected” costs and delays. Since 1976, the federal rehabilitation tax credit has encouraged the preservation and adaptive reuse of historic buildings by offering federal tax credits to owners. The tax credits represent a dollar-for-dollar reduction of federal taxes owed based on 20% of the cost of the rehabilitation project. We think utilizing the rehabilitation tax credit is in the best interest of both the developers and the public. Here is how it could work: Basically, there are 4 factors that determine whether a rehabilitation project meets the basic application requirements for the 20% tax credit. With a strong commitment from the developers to preserve the interior and exterior of the Farley building we believe it is possible for the project to meet all 4 factors: 1. The historic building must be listed in the National Register of Historic Places or be certified as contributing to the significance of a “registered historic district.” 2. After rehabilitation, the historic building must be used for an income-producing purpose for at least five years. 3. The project must meet the “substantial rehabilitation test.” In brief, this means that the cost of rehabilitation must exceed the pre-rehabilitation cost of the building. Generally, this test must be met within two years or within five years for a project completed in multiple phases. 4. The rehabilitation work must be done according to the Secretary of the Interior’s Standards for Rehabilitation. These are ten principles that, when followed, ensure the historic character of the building has been preserved in the rehabilitation. (Source: U.S. Department of Interior) farley post office interior smallWe can check off factors 1, 2, and 3. The big question mark is #4 – whether the developers are willing to complete the project according to the Standards for Rehabilitation. The developers of Moynihan Station will have to work closely with the State Historic Preservation Office to determine which interior and exterior features define the building’s historic character. They must commit to preserving those features in the rehabilitation project. For example, the rooftop addition over the western annex for the new MSG will have to be appropriately set back from the historic façade and not highly visual from the street. The lobby’s ticket windows must be preserved – not blasted through for new hallways. Another hurdle could be the “Wall Retention Requirement,” which requires the project to retain “at least 75 percent of the internal structural framework.” Some early renderings of the train hall showed the historic brick walls of the interior replaced with glass. Due to complex tax rules, it’s likely the Moynihan Station Venture would syndicate the credit rather than redeeming it themselves. Syndication typically means “selling” the tax credit to an investor or group of investors exempt from passive loss rules (typically a large bank, corporation, or other institutional investor). The “investor” enters the partnership and provides upfront equity to the project in exchange for the right to redeem the federal tax credits. In other words, if the developers can’t use the tax credits, they find an entity that specializes in using them, and the developers form a partnership with them. As a result, both the public and the developers benefit from more federal funding. Please let us know if you disagree or see some other way to leverage the tax credits. We’ll have more info on preserving the Farley building throughout the week.