MTA plans to build through budget uncertainty

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The MTA is charging ahead with big plans for New York’s infrastructure future, even as questions swirl about where the long-term money will come from.

Several major projects have been announced in recent weeks. For instance, last month the New York City-based transit agency awarded a $186.6 million contract to a joint venture between Dallas-based AECOM and Kansas City, Missouri-based HNTB. The JV team will oversee the Second Avenue subway extension to East Harlem, said Evan Eisland, executive vice president and general counsel of MTA Construction and Development, during an MTA board meeting on March 24.

The extension, known as Phase 2, will push the Q line north from its current terminus at 96th Street to 125th Street, adding three new stations and expanding access for residents in East Harlem.

Elsewhere in the city, momentum is building on the Interborough Express project.

The MTA held its first open house in Queens on March 27, sharing updates on the light-rail project that would connect Bay Ridge in Brooklyn to Jackson Heights in Queens along a 14-mile route. The line would use existing Long Island Rail Road and CSX-owned tracks, providing connections to 17 subway lines and the LIRR.

The agency expects to move into the design phase soon, said Aryeh Lemberger, senior vice president at Montreal-based contractor WSP, during the New York Build conference in March. The MTA selected WSP in August 2023 to perform the environmental review for the project.

But while the MTA pushes ahead on multiple projects, concerns linger around funding.

Although state funding has temporarily held off the MTA’s projected budget deficit, the last of its temporary federal aid could run out this year. Further complicating matters, the New York state budget remains in flux.

New York lawmakers missed the April 1 deadline, then passed on April 3 a four-day budget extension as they finalize the final spending plan. Gov. Kathy Hochul proposed a budget of about $252 billion for 2026 on Jan. 21, an increase of 3.6%.

Conversations around the budget also include debate over whether to expand prevailing wage requirements. The change would mostly affect market-rate developments, such as commercial and retail buildings, that take government cash.

At the same time, New York’s congestion pricing program, which is expected to bring in about $500 million during its first three years, remains up in the air. Transportation Secretary Sean Duffy announced March 20 he would give New York 30 days to end the congestion pricing program.

Beyond IBX and the Second Avenue extension, other large-scale public works are also in play in the area, including the $16 billion Gateway program, $7 billion Penn Station redevelopment and multibillion-dollar airport renovations.