INFRASTRUCTURE UPDATE

New Building Congress Report Urges Wide-Ranging Improvements to New York City’s Capital Planning, Management, and Funding

In order to meet the immense physical demands brought about by a growing economy, the City of New York must revamp the way it plans, pays for, and builds its vast network of roads, bridges, transit, schools, and other vital infrastructure systems, according to a policy report released today by the New York Building Congress in conjunction with its research, educational, and philanthropic arm, the New York Building Foundation.

In Building a Better NYC Capital Budget, the Building Congress urges the adoption of new user fees to be dedicated solely to infrastructure investment. To ensure that these additional revenues are leveraged to the maximum possible extent, the report also recommends specific steps designed to create a far more strategic and realistic approach to the City’s capital planning process to allow more capital projects to be constructed on time and on budget.

Capital Planning
The Building Congress calls on City government to overhaul its antiquated capital planning process to clearly define long-term priorities and comprehensively guide ongoing capital investment decisions. As envisioned in the report, the revised process would include the following elements:

  • A new twenty-year capital needs assessment, updated every four years, that looks at the City’s demographics, economy, environmental issues, and general infrastructure needs, and presents a financially unconstrained outline of the full range of the City’s capital needs.

  • A fiscally responsible ten-year capital strategy that draws from the twenty-year assessment and prioritizes the City’s infrastructure needs to be undertaken in the next decade. 

  • From there, the City would adopt a fixed, four-year capital program that is fully funded and premised on measurable targets that can be tracked through the period. Currently, the City’s capital program changes from year to year, dictated by immediate needs, making it difficult to track and assess progress over time.

These improvements would greatly improve the City’s ability to understand the scope of its needs and plan its overall capital program rationally.

Procurement and Project Delivery
The Building Congress also advocates streamlining the City’s procurement and project delivery process to further increase efficiencies and reduce costs. As detailed in the report, the proposed approaches include:

  • Passage of State legislation to permit the City to use proven project delivery methods, like design-build, that require more collaboration among project participants and reduce the time it takes to plan, design and construct projects.

  • Expanded use of integrated project delivery and LEAN construction practices, which require teamwork and problem-solving approaches not standard on traditionally-managed City projects.

  • Added staff and resources to increase project management capacity within individual City agencies to improve their ability to monitor and manage large construction projects.

  • Improvements in such areas as change order requests, dispute resolution, and contract language to better balance risk, reduce costs, and speed project delivery.

Dedicated Revenues
New York City also must address the large funding gap that further limits the City’s ability to meet more of its capital needs. Existing financial support for the City’s capital projects is in constant competition with other priorities, and, unlike other budget items, capital budgets are restricted, by statute, to a specific percentage of the City’s tax revenue.

Building a Better NYC Capital Budget offers the following illustrations of how the City, with State government’s consent, could generate new sources of dedicated revenue:

  • Increase the gasoline excise tax or lift the cap on the sales tax on gas.
  • Charge a fee on vehicles entering the Manhattan central business district, as part of a uniform toll policy.
  • Implement dedicated parking fees, including a neighborhood parking permit and dynamically priced parking meters.
  • Implement a new sales tax surcharge in the City.
  • Implement a Save-As-You-Throw garbage fee for the City’s residential buildings. A user fee for refuse collection encourages conservation and will help control the City’s sanitation costs, which have quadrupled in the last 20 years. Revenue can be dedicated to the City’s environmental infrastructure.
  • Use a Tax Increment Financing model to direct a portion of increasing property values to an infrastructure fund.

The Building Congress also calls for the creation of a Mayor’s Office of Infrastructure and a City Council Committee on Infrastructure that would continuously review the City’s capital planning and propose ways to improve overall project delivery.
 
“New York City’s success over the past two decades can be attributed in part to wise City and State investment in public works, which in turn has facilitated an explosion of private investment,” said Building Congress President, Richard T. Anderson.  “This report offers a blueprint for continuing this cycle of success though further improvements to transportation access, better schools, and more reliable services from government.”

What you can do:

Contact Mayor Bill de Blasio and New York Council Speaker Melissa Mark Viverito to urge the Administration and Council to act on these recommendations to improve capital planning, project delivery, and revenue generation.

Contact Governor Andrew Cuomo and State Legislature leadership, Senate Majority Leader John J. Flanagan, Senate Coalition Leader Jeffrey D. Klein, and Assembly Speaker Carl Heastie, to urge passage of State legislation to allow the City to use alternative project delivery methods, such as design-build, as well as to establish new dedicated revenue sources to support New York City’s infrastructure investment.

For a copy of the report, Building a Better NYC Capital Budget, click here.

    The New York Building Congress is a membership coalition of business, labor, association and government organizations promoting the design, construction
and real estate industry in New York City.