The construction cost of a portal at New York City’s Grand Central Terminal for Long Island Rail Road trains has doubled to $8.76 billion, state Comptroller Tom DiNapoli said.
The Metropolitan Transportation Authority’s East Side Access plan, the largest U.S. public transportation project, will connect 160,000 daily riders to Grand Central, DiNapoli said in a report released today. The authority, which raised LIRR fares on March 1, estimated in 1999 that the project would cost $4.3 billion and be finished by 2009. It won’t be done until 2019, DiNapoli said.
“Time and again, the MTA has come up short on the goal to deliver the East Side Access project on schedule and within budget,” DiNapoli said in an e-mailed statement. “Taxpayers will have to bear the brunt.”
The biggest U.S. transit agency’s most recent estimate for the project, expected to cut commutes as much as 40 minutes, was $8.25 billion, though that didn’t include full costs for rail cars, DiNapoli said.
More than half the overruns occurred after the MTA won a $2.7 billion federal grant in 2006, he said. At the time, the agency pegged the cost at $6.3 billion. The state is contributing $450 million.
MTA has applied for a $3 billion federal loan for rail improvements. Most of the remaining funding will come from bond sales, DiNapoli said.
The agency is reviewing DiNapoli’s report, Kevin Ortiz, a spokesman, said in e-mailed statement.
James Brennan, a Brooklyn Democrat who heads an Assembly committee that oversees the MTA, said overruns and rising debt-service costs may hamper the agency’s ability to pay for infrastructure.
“It’s absolutely essential that they come in as planned, because we can’t allow cost overruns to gobble up the construction budget,” Brennan said in an interview in Albany. “We just can’t afford it.”
Investors in the $3.7 trillion municipal-bond market are penalizing the MTA for the overruns.
A MTA bond sold in July and maturing in 2038 traded the most in a week today. It had an average yield of 3.61 percent, the highest since Jan. 31, data compiled by Bloomberg show. The yield increased 0.14 percentage point since it last traded, the biggest jump since Jan. 29, the data show. Standard & Poor’s rates the debt A, five levels below AAA.
The agency, which runs a variety of rail and surface transport, is raising base fare on subways and buses by 25 cents to $2.50 this month to help collect an extra $450 million annually to fill projected budget deficits.
Long Island Rail Road and Metro-North commuter rail fares vary based on length of trip, time of day and type of ticket purchased. The price of most tickets is increasing by 8.2 percent to 9.3 percent.