Date: Dec 10, 2009
Press Release Number: 152-2009
Holds Operating Budget Flat and Reduces Headcount by 150 Positions;
Includes $3.1 Billion Investment in Capital Projects, Including WTC and ARC;
Addresses Substantial Fiscal Constraints Caused by Recession by Deferring Certain Capital Projects Beyond 2016
In response to the historic economic downturn, the Port Authority Board of Commissioners today approved a $6.3 billion budget for 2010 that controls spending by providing for zero growth in operating expenses for the second consecutive year and reducing agency headcount to its lowest levels in 40 years. The budget also calls for $3.1 billion in capital spending to keep its priority projects moving forward, but also defers certain major capital expenditures in response to the economic downturn, which has significantly impacted the agency.
The budget approved today reduces agency headcount by 150 positions, bringing staff levels to the lowest in 40 years, and includes other cost-control measures including: a 20-percent reduction in overtime and a 32-percent reduction in external consultants. Taken on top of previous staff reductions, the Port Authority has now eliminated 507 non-police positions since 2004, a 9 percent reduction.
The agency also said its 10-year capital capacity has shrunk $5 billion, from $29.5 billion to $24.5 billion, due to the economic recession, which has caused continued projected declines in activity levels at all Port Authority facilities in 2010 when compared to originally forecasted estimates, including declines in passenger traffic of 10 percent at the airports and 11.8 percent on the PATH rapid-transit system, a decline of 6.1 percent in vehicular traffic at the bridges and tunnels, and a decline of 16 percent in cargo volumes at the marine terminals.
As a result, in addition to controlling operating costs, the agency said it will defer certain discretionary capital projects beyond the end of the current 10-year capital plan in 2016. For example:
This fiscal discipline allows for enough capital spending in 2010 to keep priority projects moving forward, such as Access to the Region's Core, the modernization of the PATH system and the World Trade Center rebuilding, as well as to continue maintaining agency facilities in a state of good repair.
It is also because of this continued financial discipline in controlling operating expenses and prioritizing capital spending that the 2010 budget calls for no increases in tolls and fares.
Port Authority Chairman Anthony R. Coscia said, "In these tough economic times, we've been forced to make difficult choices to live within our means. Making these choices meets our commitment to spend the public's money wisely and allows us to move forward on the region's most critical infrastructure needs."
Portt Authority Executive Director Chris Ward said, "The Port Authority is not recession-proof and we have been forced to defer some important capital projects due to the historic economic downturn. This budget meets our critical spending needs, but only because we continue to reign in operating expenses and prioritize capital projects, which we will continue to do going forward."
In addition to the $3.1 billion in capital expenditures, the 2010 budget includes $2.5 billion in operating expenses, $689 million for debt service and $44 million for other expenses, such as heavy vehicles and equipment and computer systems, which are deferred and amortized in future periods.
Major highlights of the Port Authority's 2010 operating budget include:
Major highlights of the Port Authority's 2010 capital budget include: