When Jay Walder left the MTA last week, The NY Times, The NY Daily News, political kingpins and all the other city’s mover and shakers lamented the departure of this noble chairman of the agency in charge of New York’s public transportation, who gave about 10 seconds notice before he scrammed for greener–much greener–pastures.
They spoke reverently of the excellent job he did, all mentioning his countdown clock initiative which tells us how long we must wait for the next train. I know these clocks are appreciated by riders, but also know they were in the works long before Walder arrived on the scene two years ago.
Walder signed a six year contract paying $350,000 a year. He said he was in for the long haul, and even demanded a payout of over $750,000 if he was asked to leave early. So what do we get when he leaves us in the lurch? You’ve got it–a cloud of dust and a hearty “So long, suckers!”
But we shouldn’t be surprised. Walder was just another in a long line of chairman pretending that he was running a public transit system, when he knew damn well he was actually running a crony capitalism real estate firm.
Yep, that’s what it is–and it was that way long before Walder arrived on the scene…
In 2005, the same group of politicians and real estate types that praised Walder’s sterling stewardship of the MTA conspired to build a $2 billion dollar stadium for Johnson & Johnson magnate Robert Wood (“Woody”) Johnson’s New York Jets football team on the West Side of Manhattan–most of it with taxpayer money.
Guess who owned the development rights for the land? You got it–the MTA. And while this prime property was appraised at just under $1 billion, the goodfellas on the MTA board offered it to their Jet cronies for the bargain basement price of $300 million.
The MTA, then run by real estate mogul Peter Kalikow, couldn’t wait to privately work out this deal with the low-balling Jets (it eventually fell apart), while simultaneously pleading poverty and preparing to raise the subway and bus fares.
At about the same time, real estate magnate and co-owner of the NJ Nets basketball team Bruce Ratner announced his latest extravaganza: The Atlantic Yards. This grand development was to encompass office buildings, residential towers, a hotel and a new home for the Nets in downtown Brooklyn.
Take three guesses who owned a vital chunk of this real estate. The first two don’t count.
In 2005 the MTA struck a secret deal to sell crony Ratner the valuable property without opening it up to competitive bidding. When the media caught wind of this scheme, the MTA reluctantly gave other bidders a short window for bids.
Real estate firm Extell bid $150 million. Ratner bid $50 million (eventually raised to $100 million). Guess who won the rights?
And of course, that same year the MTA again pleaded poverty and suggested raising the subway and bus fares again.
But “poverty” is a relative term. The MTA board, all appointed by politicians and comprised mainly of connected insiders, pulls in over $200,000 each for their part time positions, used primarily to protect and enrich their corporate cronies.
The Nets arena is expected to open next year. Meanwhile Walder has parleyed his two years at the MTA into a $2 million dollar a year position as CEO of a Hong Kong firm involved in rail systems and yes, real estate development.
Last year, New York State Controller Thomas DiNapoli audited the MTA , and released a scathing report. “Millions of New Yorkers rely on the MTA,” said DiNapoli, “and they can’t afford to pay more while the MTA ignores potential cost savings.
“Before making drastic service cuts and talking about fare hikes,” warned DiNapoli, “the MTA has to maximize the value of its real estate holdings, publish a full list of these holdings and let New Yorkers know how it’s going to capitalize on these assets.”
Since then, the MTA has raised the fares again, cut service, and released a vague statement about how they are constantly striving to “upzone their properties to unlock their full value.”
Meanwhile, the search for the new MTA chairman and champion of mass transit is on. Wonder if Donald Trump is available?