Posted on 12/15/2013 4:48:55 AM PST by SMGFan
“Its board of directors and its executive leaders are appointed by the two governors, but beyond that the organization actually operates much more like a private business than most people realize. They don’t get a single penny of taxpayer money, so all of their revenues come from the operations of the facilities they own.”
They may “operate” like a private business but it is in fact a regional governmental agency created by and operating under the authority, and with the authority of the governments of the states of New York and New Jersey, from whom its powers are granted.
Its revenues in many cases, like the GW Bridge, Holland and Lincoln Tunnel tolls amount to, at this point, a form of tax way above and beyond the needs of sustaining the infrastructure and operations of those facilities and used, just like a tax, to pay for the deficits and borrowing it has done for other operations and projects, like the World Trade Center.
The truth of the “economic benefits” of the World Trade Center was always a public relations fiction. Given its size it killed dozewns of private development projects on the boards for lower Manhattan (I know, I worked in the high-rise sector of the construction industry at the time), with investors knowing that the governments of New York state and city would insist on making the project work by cancelling and/or not renewing some private leases on space in Manhattan, moving many agencies into the WTC, at less than market rates (they got the Feds to do that too), and that the Port Authority itself would offer below market rates and subsidize some tenants to try to fill its gargantuan space. The truth is that the WTC was a financial white elephant that the Port Authority was not able to unload on private capital until just a few months before the 9/11 incident. No private capital investors would have created it, but, as much as needed, without it, private capital would have continued (and was ready) to upgrade and expand office space in lower Manhattan, with ventures that were economically viable.
What is the Port Authotity’s contribution to “economic developmenmt”? It crowds out actual private capital development, with the exception of the crony capitalists it gets tied into its projects or the hangers-on that would have just as well invested in other developments if the political clout of the PA and sometimes its use of eminent domain (yes, IT TOO can use eminent domain) had not made a piece of development more attractive than it otherwise would have been.
As I said, many operations of the Port Authority need to be removed on it and made into separate and independent operations, like the Hudson River crossings, and many other operations need to be privatized, like the airports.
The problem was that the Federal courts were getting inundated with legal disputes that could not be effectively adjudicated because of the hopelessly complex legal systems in place (then and now). When a shipper paid to export cargo through a port terminal in New York's harbor, for example, a legal dispute could be subject to state law in New Jersey (where barges departed to move cargo to the piers on the New York side of the river), state law in New York (where barges landed and cargo was transferred to ocean-going freighters), Federal railroad law, and/or international maritime law.
The Port Authority was mandated because the bi-state nature of transportation in the region was seen as a major impediment to commerce for both the region and for the nation as a whole.
The agency has flaws like any government organization, but the region works a heck of a lot better than it would without it.
I'd also make the case that any assessment of the World Trade Center that is based on its adverse impact on the commercial real estate market in lower Manhattan is completely off-base. It's easy to say that today in 2013, but when the WTC was built in the early 1970s there was really no commercial real estate market in lower Manhattan at all. New York City was in a period of serious decline, and the center of office/commercial activity had already begun migrating from lower Manhattan to the midtown area. The WTC project was seen as a way to boost the entire real estate market at the time.
I got a brief peek behind the curtain while working for a design firm involved with Newark Airport Terminal C. They consider themselves above the law. Their special political status made them immune to either state’s building codes if they chose to do so. When asked for justification the PA mgrs just said, “ We’re the Port Authority, we make our own rules.”.
“The agency has flaws like any government organization, but the region works a heck of a lot better than it would without it.”
Nonsense.
There were two other solutions: reciprocal agreements between New York and New Jersey to eliminate disputes of jurisdiction in favor a single bi-state authority for those jurisdictional questions WITHOUT a bi-state entity OWNING and OPERATING any facilities, or federal acquisition of the assets with 100 year lease-backs to the private entities operating them - putting them under one set of federal rules. But no, SOMEONE(s) wanted REMOVAL of the enterprises from direct jurisdictional oversight by any set of elected representatives, so that, in typical faacist fashion the PA could (and does) make its own rules, and as I said, with only MINOR crony capitalist watching by the two state governors.
All you need to know is "It's Bush's fault".
“It’s easy to say that today in 2013, but when the WTC was built in the early 1970s there was really no commercial real estate market in lower Manhattan at all.”
Wrongo. The builders and investors in high-rise commercial real estate know full well, and have always known, it is not today’s rental market vacancy rates against wich they measure their building plans but tomorrows. The day the final agreements giving the go-ahead for putting up the WTC were given, three lower Manhattan projects that would have been built by the company I worked for over the following five years were cancelled and five more in the discusssion stage were tabled. Builders and investors who plan on charging market rate rents do not go ahead with plans for building high rise commercial rental space when the main competitor against all of them will be a gigantic government funded (favorable borrowing rates for the PA) project that will discount and subsidize a larger portion of its space for many years, as well as use its political clout to get state, local and federal agencies to occupy many floors of space, with subsidies and discounts for them.
“It’s easy to say that today in 2013, but when the WTC was built in the early 1970s there was really no commercial real estate market in lower Manhattan at all.”
Wrongo. The builders and investors in high-rise commercial real estate know full well, and have always known, it is not today’s rental market vacancy rates against wich they measure their building plans but tomorrows. The day the final agreements giving the go-ahead for putting up the WTC were given, three lower Manhattan projects that would have been built by the company I worked for over the following five years were cancelled and five more in the discusssion stage were tabled. Builders and investors who plan on charging market rate rents do not go ahead with plans for building high rise commercial rental space when the main competitor against all of them will be a gigantic government funded (favorable borrowing rates for the PA) project that will discount and subsidize a larger portion of its space for many years, as well as use its political clout to get state, local and federal agencies to occupy many floors of space, with subsidies and discounts for them.
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