PORT AUTHORITY PROPOSES 1994 BUDGET
NEW YORK, Dec. 2 /PRNewswire/ -- Significant investments at airports and interstate bridges and tunnels, as well as aggressive cost-cutting and productivity improvements, highlight the $2.7 billion budget for 1994 proposed today by the Port Authority of New York and New Jersey. The $2.68 billion spending plan, which contains no fare or toll increases, is virtually unchanged from this year's level. The 1994 budget includes $728 million for capital improvements and $1.58 billion in operating expenses. The proposal is expected to be voted on by the agency's Board of Commissioners on Dec. 16. "This budget is a significant achievement," said Stanley Brezenoff, executive director of the agency. "The soft regional economy, flat Port Authority revenues and the tragic bombing at the World Trade Center all created great financial pressure. We estimate that net operating revenues for 1993 will be $40 million less than expected. "But our staff held down expense growth, and developed new productivity and cost-control initiatives," Mr. Brezenoff said. "The result is a very tight budget, with expense growth less than inflation for the third consecutive year." Mr. Brezenoff said vigorous cost-containment efforts will make it possible to continue capital investments and customer service programs, such as the very successful Operation Alternative at the Port Authority Bus Terminal and anti-hustling initiatives at the region's three major airports. The agency's net revenues, however, will remain under pressure, according to Mr. Brezenoff. "I have made it clear to staff that cost control and productivity improvements continue to be the order of the day," said Mr. Brezenoff. Mr. Brezenoff said major points in the budget include the following: -- New productivity and cost-control initiatives will total $50 million in savings for 1994. Combined with recurrent savings put in place since 1989, the 1994 annual value of productivity and cost-control savings will reach $175 million -- equal to approximately 12 percent of the agency's operating expense budget. -- Productivity and cost-control efforts have focused on a wide spectrum of activities. One key area is staffing. Headcount reductions averaging about 1 percent a year will continue through 1996. By 1994, reductions will reach 900 positions -- 9 percent -- since 1988, bringing total headcount for the agency down to 9,100. On the capital front, the agency's Value Management program has identified significant savings and functional improvements on major capital projects. -- Other specific cost-saving steps include downsizing the office of Medical Services; reducing leased space; expanding applications of information technology; reducing costs for contractor insurance programs; vigorous implementation of recycling and energy conservation at the World Trade Center; and improving the operational efficiency of Trade Center elevator and heating-ventilation-air conditioning systems. -- Steps to improve customer and tenant service include Operation Alternative, the program that has benefited both the homeless and commuters at the Port Authority Bus Terminal; Operation Secure, a similar program at PATH stations; anti-hustling programs at the airports; tenant and customer satisfaction surveys and improvement programs at the World Trade Center, Newark Legal Center and Port Newark/Elizabeth; and the Airport Ambassadors training program for patron services staff. -- The 1994-1998 Capital Plan continues the program of intensive investment in Port Authority facilities. Planned capital spending totals $3.8 billion over the next five years, virtually unchanged from last year's plan, with $728 million allocated for capital improvements in 1994. The plan also provides more than $300 million over the next five years for transportation and economic development projects in the states of New York and New Jersey. Port Authority direct capital investment will be augmented by a projected $3 billion in additional private investment by business partners and tenants at agency facilities. "This investment program will support 95,000 permanent and construction jobs across the region," Mr. Brezenoff said. "It will generate $10.6 billion in sales, $3.6 billion in wages and $350 million in state and local tax revenues." Mr. Brezenoff said that advancing the Port Authority's capital program is a top priority. Significant areas of investment include improvements at John F. Kennedy and Newark International airports, as well as LaGuardia. Other priorities are rehabilitation of the Lincoln Tunnel, George Washington Bridge, outerbridge Crossing, PATH and other facilities in the interstate transportation network. Restoration and refurbishment of the World Trade Center also remains a critical task in the capital plan. The agency is also planning rail links to the three airports, using revenue from the federally approved Passenger Facility Charge program. Specifically, the $728 million in 1994 capital spending in the budget provides: Airports - $388 million, including; -- Continuation of major roadway work at John F. Kennedy International Airport, as well as renovation of the two TWA terminals also at JFK; rehabilitation of the Central Terminal Building at LaGuardia Airport; major roadway capacity expansion at Newark International Airport; construction of Newark Airport's monorail; and construction of the new International Terminal also at Newark Airport. Interstate Transportation - $130 million, including: -- Rehabilitation of the South and Center Tubes of the Lincoln Tunnel; rehabilitation of the roadway deck steel and median barrier at the Outerbridge crossing; continued construction on PATH's 19th Street tunnel ventilation project; and Holland Tunnel traffic improvements for 12th and 14th streets in Jersey City. World Trade Center - $66 million, including: -- Complete restoration of the world Trade Center complex following the February 1993 bombing, and to continue modernizing the complex's Plaza and Concourse. Port - $55 million, including: -- Intermodal improvements at the Port Newark/Elizabeth Marine Complex, and continued dredging of the Kill van Kull. Regional Development - $31 million, including: -- A new building at the Bathgate Industrial Park in the South Bronx; rehabilitation of Building 1 at the Yonkers Industrial Park; and improvements at the Newark Legal and Communications Center. Other Budget Provisions The 1994 budget includes $75 million for expenditures for transportation, economic development and infrastructure renewal projects proposed by the governors. It provides $15 million for emergency repairs and environmental remediation; an allowance of $25 million for projects under study and development; and $39 million for other expenditures, mostly related to future years. Debt Service And Reserves Debt service charged to operations will total $336 million in 1994, compared to an estimated $334 million in 1993. The 1994 budget anticipates gross operating revenues of $2.1 billion, a 4.3 percent increase over 1993 estimated revenues. Federal aid, Passenger Facility Charges (PFCs) and other revenues are anticipated at $66 million, and financial income, reserves, cash and investments are estimated to be $91 million. After deducting $1.6 billion in operating expenses, net revenues available for debt service and reserves are expected to total $572 million in 1994. "These financial results are sufficient to meet the requirements of our resolutions and provide the financial capacity needed to support the Port Authority's capital improvement program," Mr. Brezenoff said. The
Port Authority is a self-supporting corporate agency of the two states, functioning without burden to the taxpayer.
-0- 12/2/93 /CONTACT: Mark Marchese, director of The Port Authority of New York and New Jersey, 212-435-7777 (24 hours), or 201-961-6600, ext. 7777/
CO: The Port Authority of NY & NJ ST: New York IN: TRN SU:
MP-TW -- NY069 -- 9837 12/02/93 13:02 EST