Building congress supports infrastructure funding from $4 billion bank settlement

In a letter to Governor Andrew Cuomo, the New York Building Congress called on the State of New York to use $4 billion from several recent legal settlements with major banks to fund badly-needed infrastructure investments.

The money is an unexpected windfall for the State following victories in a number of high profile court cases and is not yet earmarked for specific government uses.

The letter highlights the tenuousness of the State’s existing transportation funding and argues that spending on road and rail is unique, because it undergirds the rest of New York City’s economy by allowing the highest concentration of jobs, tourism, and housing in the country.

Yet this advantage is jeopardized as the MTA faces at least a $12 billion funding gap in its 2015-2019 capital plan. This figure does not include money to continue the MTA’s two major expansion projects, the 2nd Avenue Subway, and East Side Access. No funds have been identified to fill this gap.

Funding for roads and bridges is equally uncertain.  The State Department of Transportation has not had a five-year capital plan since 2008 due to constrained funding and has only been able to fund half of the Kosciuszko Bridge replacement, leaving a $400 million gap in that project alone. The Dedicated Bridge and Highway Trust Fund – meant to provide reliable capital funding for the State’s roads and bridges – must actually be subsidized from the State’s general fund in order to meet its annual obligations.

A strong case for dedicating the settlement funds to infrastructure can be made because construction is an important engine for jobs and other economic activity. According to the Building Congress, in 2013, $29.3 billion in direct construction spending in New York City yielded $15.7 billion in additional business revenue – for total economic output of $45 billion. Similarly, last year’s construction activity produced 93,400 jobs in addition to the 120,900 direct construction jobs, paying salaries well above the City average.

A new infusion of capital dollars might also help propel important expansion projects. For example, the Building Congress recently released Moving Midtown West, recommending implementation of four projects around Penn Station, including construction of a new cross-Hudson River tunnel. A new tunnel would increase capacity by hundreds of thousands of additional daily commuters and relieve pressure on the only other commuter rail tunnel linking New York and New Jersey, which is over one hundred years old.

Building Congress President Richard T. Anderson said, “The State’s windfall offers a rare opportunity to fill gaping holes in transportation capital funding. It may even allow the State the leverage it needs to advance badly-needed expansion projects.” Anderson added, “The Building Congress joins a long list of civic and industry leaders who advocate putting this money to work by investing in New York’s core infrastructure.”

WHAT YOU CAN DO

Contact Governor Andrew Cuomo and tell him to set aside the State’s bank settlement funds for long-term investment in transportation.

Contact your local State Senator and State Assembly Member with the same message.