Tunnels to nowhere.

TUNNELS TO NOWHERE

In the fall of 1962 Robert Wagner Jr., mayor of New York, received a report from budget and transit experts on his staff that showed the subway trains in Queens were too crowded. The central portion of Queens County had experienced booming growth in the postwar decades, with the result that the E and F trains were being used beyond capacity. The report recommended that the subway be expanded in Queens. Wagner agreed with the findings and launched a project that was to become the biggest boondoggle in New York history, and a textbook case of government unaccountability.

Twenty-three year later, more than $1.23 billion of taxpayers' money--about two-thirds of it federal funds--has created two huge tunnels and a half-dozen holes in the ground stretching 6.5 miles across New York City. The tunnels are filled with rotting equipment. In some places they contain pools of water five-feet deep. Needless to say, they have not served a single rider, and it is entirely possible they never will.

What New Yorkers have taken to calling "Tunnels to Nowhere' began as a dream to build 52 miles of new subway tracks to carry more than 150,000 riders a day. Today, even under an extremely optimistic scenario--which assumes they will receive tens, maybe hundreds of millions of federal dollars from programs that are shrinking or nonexistent--subway service would be created for only 7,600 straphangers a day. The cost of providing this service would exceed fares by more than $15 million annually. To create a system serving even half as many riders as originally planned would cost another $200 million and perhaps as much as $1 billion, which is nowhere to be found. And to top it all off, many of the residents who would be served by a completed system don't want it anymore. For these and other reasons, it seems likelier that the tunnels will end up serving primarily as a direct route for rats and mice making their way across the East River. And because of the way this governmental misfire occurred, we won't even know who to blame.

The "Grand Design'

It was good politics, as well as decent public policy, to offer new mass transit service to the people of Queens in the mid-1960s. When Governor Nelson Rockefeller was looking for New York City votes to secure passage of a $2.5 billion transportation bond issue he wanted to float to redeem a 1966 campaign promise, he grabbed the only capital construction plan lying on the shelf of the New York City Transit Authority. Far from being a well-conceived program, it was a haphazard wish-list compiled by city transit planners who hadn't had anything to construct in more than 30 years. It not only included proposals for much-needed service to Queens but also called for building new stations or even entirely new lines in all but one of the city's five boroughs.

These were the days when people considered the subways a relatively safe and thoroughly effective way of getting around. So the prospect of having a new subway stop on the corner delighted voters and politicians alike, and encouraged planners to think big.

That was fine with Rockefeller and city officials, to whom bigness and boldness were the keystones of any program. Their go-getter spirit is recalled by Robert Kiley, now the chairman of the Metropolitan Transportation Authority: "The country and the city were still in a "can-do' mood. "Guns and butter,' "growth and expansion,' "government and progress' were unquestioned bywords for most Americans.' The bond issue carried overwhelmingly. Some $600 million became available to the newly constituted Metropolitan Transportation Authority, the regional mass transit system. The planners and engineers, not used to having so much money, let their imaginations run wild.

They saw tunnels that would stretch the entire length of Manhattan, all the way to the Bronx. Another set of routes would lie perpendicular to the Manhattan line, with a tunnel under the East River at 63rd Street and subway tracks sprawling across the entire length of Queens, the city's largest borough. Throughout central queens, residents would have a new convenient way of getting around the borough and to Manhattan. They estimated that $150,000 New Yorkers would ride the new lines daily, and it would cost only $1.3 billion, a modest price considering the substantial improvements to the system.

But even for those pre-1970s-inflation days, the estimates in the appropriately named "Grand Design' document were laughably low. In part, this reflected a tradition that had been established by the city's master builder, Robert Moses, of low-balling construction estimates. Moses had a simple two-phase building formula: 1) coax your bosses and the public to support major initiatives by deliberately underestimating the cost; 2) get part way through the project and drop the bombshell that much more money is needed. Confronted with the choice of paying huge sums more to finish the work or seeing the original expenditures wasted, the public had always chosen to go ahead.

But the low estimates also reflected simple ignorance. The planners really had no idea how much a large-scale project would cost. Within three years the price tag ballooned from $1.3 billion to more than $3 billion, while the original plan for 13 routes and 52 miles of track was scaled back to 11 routes and 30 miles of track.

By late 1974 only four miles of subway were under construction, and, given the bureaucratic maze through which all plans had to travel, even that was a miracle. The program still needed preliminary design, final design, land acquisition, and construction and equipment contracts for each line section. For each portion the city had to get approval not only from divisions within the MTA but also from the Urban Mass Transportation Administration (which dispensed federal funds) and 17 other local, regional, and state agencies. Everyone from the city council to the state Department of Transportation was involved. In one case, a local community board representing a posh section near Central Park held up construction of a ventilation shaft for months because of fears that the construction work would ruin the neighborhood.

The $200 million drawing

Then came New York City's fiscal crisis. As late as July 1974, Mayor Abraham Beame and Governor Malcolm Wilson had donned hardhats and manned jackhammers to break ground for the fourth segment of the Second Avenue subway, a line that was supposed to provide north-south service on Manhattan's East Side and link up to Queens. But fewer than four months later, when the city realized the fiscal mess it was in, Beame pulled the plug on the Second Avenue subway, leaving abandoned tunnels all along eastern Manhattan. The mayor and MTA chief David Yunich decided that the city couldn't afford to squander precious capital dollars on a new subway while the existing system was crumbling. The total cost of the three holes that are the remains of the Second Avenue subway: $99.6 million. Total use: zero.

Although the decision to rein in the "New Routes' program was entirely rational, how they decided to do it was not. It did make sense to emphasize the Queens lines--63rd Street tunnel and Archer Avenue--over those of other boroughs. Those had already been started, the need in Queens was the greatest, and the city had taken care of much of the land acquisition and utility right-of-way problems. In addition, because they could be completed the fastest, the city could quickly start collecting those extra fares. But they made one fatal error. They assumed that the city would have several hundred million dollars left over after the other lines were completed to build the critical Queens Bypass. Without that connection between east Queens and the end of the 63rd Street line, there would be no express train by which those Archer Avenue travelers could cross the borough or get to Manhattan--the main point of having the new routes in the first place. Officials thought they had enough money in hand or enough coming in from the federal government to build the 63rd Street tunnel, the Archer Avenue line, and the line that was to connect them. But they so bungled the construction and planning of the New Routes program that there may not be enough to finish the first two, let alone the third. So the connecting line is still just a $200 million drawing in a planner's notebook.

That is doubly troublesome, because as the project dragged on, the MTA restricted the reach of the 63rd Street line, thereby making the nonexistent cross-Queens connection even more important. Originally the 63rd Street line was to reach all the way to Northern Boulevard, deep inside the most populous part of the borough. But in 1981 it was scaled back to 21st Street, a relatively desolate part of the city. The farther west the 63rd Street line's terminal moved, the fewer passengers it could pick up and the more isolated the Archer Avenue line became. Now, if and when the two lines operate, they will carry only 7,600 riders daily instead of the 70,000 it would if they were linked together.

Ironically, however, with the passage of time, leaving a huge chunk of Queens out of the system has come to be a popular idea in Queens. Over the past 20 years, Queens residents, like all New Yorkers, have come to hate their subways. Instead of bringing them closer to the rest of the city, the subways, they believe, bring the worst elements of the city to them: graffiti, crime, dirt, and undesirables. From 1965 to 1985 citywide daily ridership dropped by more than a million. By the early 1980s, the people of north and central Queens were in revolt against the MTA's plan to connect the 63rd Street line with Archer Avenue. The white middle-class residents, who were supposed to be the beneficiaries of this subway construction, flocked to meetings and protests because they feared the expanded service would bring, as one Rosedale mother put it, "black criminals into our neighborhoods.'

The delays and cost overruns involved in building a subway connection that nobody wanted ultimately was a frustration to more than just New Yorkers, because the federal government was involved, too. The New Routes program soaked the federal treasury for hundreds of millions of dollars. Between 1975 and 1985, the federal government spent $400 million on top of the $350 million it had already spent for the two routes, which originally were supposed to cost a total of $283 million and be completed in 1978. The feds would have to spend at least $75 million more before the two lines could open. Why was New York unable to build those two routes quickly and on budget? One answer can be found in the almost comic wrangling within the MTA.

The "Beame shuffle'

Imagine three inefficient bureaucracies that refuse to talk to each other, and you've got a pretty accurate picture of the MTA. It is divided into three distinct functions: project planning, design, and construction. As a project advanced through each of these phases, the work fell under the responsibility of a different deputy to the chief engineer. For the contractors that meant the people who designed the New Routes program did not talk to the ones responsible for building it, who in turn did not communicate well with the folks who were supposed to operate and maintain the final product. This noncommunication resulted in interminable delays, costing tens of millions of dollars.

The chaos made it easy for contractors and their employees to manipulate the system for maximum delay, and, in most cases, extra profit. A March 4, 1985 memo from a Transit Authority engineer described how one contractor working on two lengthy sections of the 63rd Street tunnel asked for payment for 809 days' worth of extra work--at costs ranging from $2,000 to $10,000 per day--because it experienced 36 different kinds of delays during the four years it was on the job. Frequent labor strikes were a particular problem.

Another reason for the delays and cost overruns was what came to be called the "Beame shuffle.' Beame decided there was another important use for federal construction dollars--as operations subsidies to save the city's 35-cent subway fare. The fiscal crisis was threatening a major fare hike, which is the top "thou shalt not' in the city's political religion. And 1975 was an election year. In fairly short order, Beame convinced members of the New York congressional delegation to push legislation allowing him to "borrow' federal capital funds and use them to offset the Transit Authority's operating deficit (and to hold the fare) as long as the city promised to spend its own funds to replace the federal funds.

It worked, some say, too well. The fare remained constant for a while, but $281 million was diverted to prop up an unrealistically low fare, and the spending of capital dollars to repair the decrepit system was reduced. The diversion of capital slowed the progress of the New Routes and allowed inflation to increase the costs.

No public works disaster would be complete without a dash of corruption. It now appears contractors may have siphoned off some of the money as well. Evidence of possible fraud has centered on the Schiavone Construction Co. and its onetime executive vice president Raymond Donovan--Ronald Reagan's former secretary of labor. A Bronx grand jury has charged Donovan and his former business associates with defrauding the Transit Authority of $7.4 million by overstating payments to a minority-run subcontractor.

As the building progressed, the job of overseeing the completed work became harder. There just weren't enough warm bodies to check all 250 miles of existing subway tracks and monitor the new segments. Consequently, there took place a curious kind of anti-turf battle over who would provide the maintenance for the new lines. Contrary to the classic model of bureacratic warfare in the Pentagon, where services battle to see who can "win' responsibility for certain jobs, the MTA bureaucratic wars were devoted almost exclusively to avoiding new responsibilities. The engineers didn't want to do the maintenance work, nor did the operations and maintenance crews. Through the mid- to late seventies there was a war of memos on this issue that ended when the operations folks scored a knockout by declaring that they'd be happy to do the overtime work, but only at overtime pay rates. The cash-strapped MTA had no choice but to assign the work to the engineers, who were not up to the job. A large number were graduates of nonaccredited engineering schools. Also, many were foreigners with so little grounding in English that they had difficulty communicating with contractors and others. "From top to bottom, the engineering department was staffed with people out of their league,' said one New York transit expert. "They enjoyed the comfort and safety of the civil service and they were constitutionally incapable of making waves or asserting themselves, especially in cases of manifest trouble.' In late 1983 the MTA decided to shift the responsibility to its own operating department, but after inspecting the tunnel, the operating department officials refused the assignment because it required too much work. That left the beleaguered engineers again in charge of the job.

With all this bickering, it's hardly surprising that the MTA managed to botch much of its construction work. Last year, for example, inspectors found that one of the major crossbeams in the 63rd Street tunnel had been placed too low to allow subways to pass, and the contractor, with the approval of only middle-level engineers, simply sliced off enough of the beam to create sufficient headway. The dispute continues about whether this compromised the tunnel's "structural integrity' (that's industry jargon for whether or not it's going to fall down). They also found stalactites hanging from the cavern-like ceilings and the aforementioned five-foot-deep puddles of water. A leaky ceiling in the tunnel's signal room, which contained the electrical lifeline to the system, left the floor covered with six inches of water and helped corrode and cripple important signal and switching equipment. Pumps and ventilation equipment had mysteriously disappeared.

A federal audit last summer revealed that concrete for the tunnel had been mixed and poured on hundreds of occasions with no inspection or testing. The investigation concluded that there is "no assurance' that 200,000 cubic yards of concrete in the tunnel is safe. Tests showed deficiencies in ten places, and there is no evidence the Transit Authority tried to correct them. A private consultant subsequently concluded that the tunnel is safe. But there is no ready explanation why the inspections were omitted, save that the engineering department was too overworked to do them.

UMTA Dumpta

The only thing more incredible than the status of the tunnels is the fact that nothing was done about it for so many years. David Gunn, president of the New York Transit Authority, the City portion of the mass transit system, recalls that he and and Metropolitan Transportation Authority Chairman Robert Kiley were briefed in April 1984, soon after they assumed their jobs, by the top engineers, who casually recited the history and current status of the program, citing no problems and confidently predicting that the system would go on line by the end of the following year. "In the months that followed, as the operating departments were preparing to take over the operations of [the tunnels], I began receiving a much different assessment than had been provided me by the engineering department,' Gunn says. Finally he found himself reporting to MTA board members that "we have a disaster on our hands.'

Why didn't the bad news reach the bosses earlier? Part of the reason is that no one really pressed to find out its status. Each time officials with the power to shut the project down sought an accounting, the engineers, more out of timidity than confidence, predicted the problems could be ironed out, and the planners insisted that the need for new subway service was still great. In those cases where conscientious officials warned about developing problems, their supervisors ignored the pleas. The MTA's files are filled with plaintive cries dating back to mid-1972 on problems with water leakage and the handling of concrete. Most of these problems were slated for consideration "at a future date.'

Beyond this unwillingness to pass along bad news, however, there were other, more novel reasons to forge ahead despite the problems. One was that federal law gave the Urban Mass Transportation Administration the authority to demand a full refund of the federal construction aid if the lines were not put into service. It is certainly reasonable to guarantee that federal tax dollars be used productively, but in this case, even though the provision had never been invoked, it produced a special lunacy that made it unthinkable for local officials to stop construction.

Unbelievable as it might seem, the entity that lost the most--the federal government--also thought it unnecessary to stop this flow of good money after bad. Only last summer did UMTA question how more than $800 million of its funds were spent. "I kept hearing how bad the situation was, so I got my staff together one day and asked, "How did this happen?'' said UMTA administrator Ralph Stanley. "If you can believe it, they couldn't tell me. Their final answer was, basically, that in the seventies, UMTA grant managers didn't feel it was their business to question local priorities. "If the locals want the subway and it meets our criteria for building, then we go ahead and pay for it,' they said. Our business was to shovel out money without any question about whether it was the best use of transportation dollars.'

It didn't help matters that UMTA had only two engineers for the entire New York-New Jersey region to oversee the tunnel construction. The few inspections they conducted often were hardly rigorous and often preannounced. It wasn't until last summer that UMTA finally suspended payments to New York for the tunnels.

New York also had one final powerful incentive to proceed. Most of the construction contracts were locked in by late 1975. When the MTA's chairman, Richard Ravitch, asked aides to analyze the future of the New Routes construction in 1979, they reported back that penalty clauses in the contracts and the cost of physically shutting off the tunnels would make stopping the project just as expensive as continuing it.

Ravitch did reform parts of the MTA's cost-accounting process and steered the system toward an emphasis on refurbishing the existing system, rather than adding to it. He left it to his successor, Robert Kiley, to figure out the ultimate fate of the tunnels. After five years of debate, the MTA decided to build a "Local Connection' for $222 million to hook up the 63rd Street tunnel to already existing local subway tracks. One problem: there is no longer any money to build the Local Connection. The MTA says it won't spend its own cash on it and hopes the funds will come from UMTA's "New Construction' kitty. But the Reagan administration budget cuts and the reluctance of UMTA's Ralph Stanley to toss more money New York's way have made that a hopeless option for now. Without the connection route, MTA officials may decide ultimately not to open the 63rd Street tunnel or Archer Avenue, even though much of the construction is completed. A consultant is expected to report within a few weeks on how much money it would take to get them running. MTA officials may decide that since they would continually lose money on the routes, they might be better off steering whatever capital money they can find toward the existing subway system and leave the new routes closed. Unfortunately, even then, the MTA's problems won't be over: it still may have to figure out a way to pay back UMTA.

The unstoppable buck

The overriding moral of this tunnel tale is the importance of accountability. At every stage someone was saying, "It's not my problem.' From the maintenance crews to the federal officials, the buck didn't stop anywhere. The incentives to proceed were so strong they overwhelmed all common sense.

The new MTA bosses have taken a step towards imposing some internal accountability. They have created 28 subdivisions in which one person's job is on the line if the work is not done well. But that does not address a more fundamental problem of who's in charge. The MTA is insulated from the political world. Its governing board is made up of appointees designated by the governor, mayor, and suburban officials from areas covered by MTA services. No one appoints a majority of the board members, and when everybody has a piece of the action, no one is finally responsible to the voters or their representatives.

"When things go wrong, New Yorkers have no one to complain to, no one to hold publicly accountable for the failure of the transit system,' says state comptroller Edward Regan. "If New Yorkers are unhappy with the way their transit system is operating, whom should they punish? More specifically, whom should they vote against? Public agencies need discipline, the discipline of the ballot box. What the passengers of our subway system need as much as anything is somebody to vote against when things go wrong and somebody to vote for when things go right.'

One of the earliest acts of New York Governor Mario Cuomo in 1983 was to ask the state legislature for the power to appoint a majority of MTA board members. But every constituency with a say in MTA affairs objected on the ground that it would dilute their "authority.' The city feared it would lose clout to the suburbs and vice versa. So Cuomo retreated. Perhaps he's quietly relieved. What politician would want his tombstone to read, "He created the tunnels to nowhere'?