Tappan Zee Bridge plans move ahead but where’s the money?

It’s hump-day, which means it’s production day at the Westchester County Business Journal, so I will keep this one short and sweet.

Yesterday the New York State Thruway Authority announced the four finalists selected to bid on the Tappan Zee Bridge rebuilding contract. The announcement comes just over a week after the state released its draft Environmental Impact Statement.

With these new developments, the Thruway Authority (which owns the bridge) and its state and federal partners have accomplished something that eluded previous administrations: that is, they have kept their promise – so far. As it stands, project coordinators still expect to award a contract by July or August and still expect construction to begin on a new bridge by the end of this year, which would be a major achievement given the length of time we have had to wait so far to see any progress whatsoever.

Now, it is time for the governor to let the public know how the bridge will be financed. With an expected price tag of $5.2 billion, the public and the four finalists are entitled to know the nitty-gritty details. In his budget address, Gov. Cuomo said funding for a new bridge would come from “authorities.” Which authorities? State or federal? Will the funding be new or will it come out of existing budgets?

Until we hear those details, I will continue to be skeptical of the governor’s plan. A new bridge is necessary and will be a huge boost to the entire region’s economy. But money doesn’t grow on trees and even the popular Mr. Cuomo can’t pull $5.2 billion out of a magic hat.

Friday Report: Tappan Zee funding questions; Westchester home sales up in 3rd Q; Armonk Square approved

Inside Track sincerely apologizes for the radio silence of the past couple days – it was particularly hectic in the newsroom. We’re back with a chock-full of topics this morning, and then later today we’ll wrap up the work week with a recap of what has made news in Westchester during the past week.

Driving the Week: This week, the Obama administration effectively fast-tracked the Tappan Zee Bridge replacement project in an executive memorandum that expedited environmental reviews and permitting the Tappan Zee and fourteen other so-called “shovel ready” infrastructure projects from around the country. However, I challenge the presumption that right now, the bridge is, in fact, shovel ready.

The U.S. Dept. of Transportation have told the Business Journal that $3 billion of the estimated total $5.2 billion cost of replacing just the bridge would come from bonds purchased by NY state and backed by toll dollars. The two problems with that are (1) How much would that require raising toll fees? and (2) Where is the remaining $2.2 billion coming from?

I just returned from a conversation with Westchester County Executive Rob Astorino, and he said that while he is happy the project was put on the fast-track and that it is moving ahead, he too has concerns about the lack of communication from Albany and Governor Andrew Cuomo, about the lack of certainty over the project’s funding, and about the apparent lack of public transit being oriented into the bridge’s design.

Driving the Week (Part II): In the Westchester Putnam Association of Realtors’ third-quarter residential real estate report that was released this week, we saw some notable increases in sales from the second quarter of this year. In fact, the 1,944 sales in Westchester County during the third quarter of 2011 represented the highest number of 3Q sales since 2008.

A decline in the home prices may have impacted the increase: for the third quarter, the median sales price for one-family homes was down six percent from 3Q 2010. More on the residential and commercial real estate markets in the next couple of weeks.

Driving the Week (Part III): On Wednesday, the town of North Castle Planning Board gave the Armonk Square development the last remaining approval that was needed before development on the 3+ acre project could begin. More on this coming in the weekly wrap-up this afternoon, but great news for a development that has been delayed for literally decades due to a number of economic and political reasons.

Outlook: Slowly but surely, the markets are clawing back, with both the DJIA and S&P 500 posting strong weeks and noticeable gains. Also, one area to watch is always commodity prices, and crude oil hit a three-week high today in New York (crude oil on the NY Mercantile Exchange is up 4.3 percent this week). A hint from the experts (I am not one of the experts, for clarification): the best indicators of the economy are not the stock indexes but instead are commodities, namely oil and copper (which is present in a really wide range of goods).  

Headlines:

National retail sales rose by 1.1 percent in September; biggest gains in seven months (Bloomberg).

Apple poised for record-breaking iPhone 4S sales this weekend following today’s release (Bloomberg).

UPDATE: Tappan Zee Bridge review to be expedited

Today, Gov. Andrew Cuomo announced that President Barack Obama has put the Tappan Zee Bridge project on the fast-track for federal review.

In a statement, the governor’s office said:

“With this expedited federal review of the Environmental Impact Statement (EIS) and the processing of certain permits, the Tappan Zee project could begin as early as next year, potentially creating more jobs than any other infrastructure project in the country.”

Tuesday Morning Report: 10,000 securities jobs to leave NY? Tappan Zee Bridge project gets boost from Cuomo; PEF contract talks continue

Good Tuesday Morning! Today the FDIC will vote on an initial version of the infamous Volcker Rule, so keep an eye on Wall Street as that vote looms. Speaking of Wall Street, did you know that the city of New York has already racked up $2 million in overtime pay as a direct result of the Occupy Wall Street protests?…

BEFORE we dive into the news, I would like to talk about my alma mater, Boston College, and a little-known competition that takes place on campus every year. It has nothing to do with our hockey team – winners of two national titles in the last four years, I might add – or our football team, which currently stinks; rather, it is a venture capital competition run by a professor in the Information Systems department. Each year, this competition awards a $5,000 grant to the team of students that generates the best and most inventive business plan, leaving them to do what they will with their new company and earnings.

One such start-up to come out of the Boston College Venture Capital competition was called WePay. Founded in 2008 by Bill Clerico and Rich Aberman as a more specialized payment service than PayPal, WePay has raised over $10 million in seed funding to date. All it took was a great idea, a few very smart students and some start-up cash to help them attract the attention of the likes of Highland Capital Partners, Y Combinator, and SVAngel.

If a private university in Chestnut Hill with 9,000 undergraduates can have its own venture capital competition, why doesn’t Westchester County? There is a wealth of talent and capital in Westchester, so why can’t we harness that in the form of a venture competition or business incubator? America’s strength has alway been beating the other guy to the punch. Since 2008, we have lost that risk-taking, fighter’s mentality.

Believe it or not, this is something that an independent panel of businesspeople – including GE chief executive Jeffery Immelt – is advocating for. From the Wall Street Journal article on the Web this morning:

“…Among its ideas to spur start-up activity, the council recommends Congress eliminate taxes on income from investments of $25 million or less in a privately held firm as long as the investment is held for at least five years. It also calls for cuts to corporate income taxes for the first three years of a company’s existence to encourage it to expand…”

Ideas like this one are needed on a national scale, but why not on a local scale as well? Here in Westchester, we have the resources, we have the higher education institutions, we have the capital, and we have the collective intellect – so what are we waiting for?

Headlines:

Wall Street to lose 10,000 jobs? A new report by NY state Comptroller Thomas DiNapoli said that New York City’s securities industry could lose nearly 10,000 jobs by the end of 2012, and that bonuses are likely to be considerably smaller this year.  

Gov. wants federal approval of TZ Bridge expedited. Yesterday, Gov. Andrew Cuomo announced that he has asked the federal government to expedite the review and approval process to allow work to begin on the Tappan Zee Bridge project, which represents a multi-billion dollar investment that will create tens of thousands of jobs.

PEF contract negotiations “ongoing.” Contract talks between the Public Employees Federation and NY State are ongoing after union members rejected the contract that was negotiated by union leadership. Just over a week remains before the nearly 3,500 pink slips sent out to PEF employees as a result of the contract rejection become official and permanent.