The Partnership for New York City submitted the following comments to the MTA in response to far-reaching proposed regulations on the debarment of contractors.
The Partnership for New York City is compelled to comment on proposed regulations promulgated pursuant to Section 1279-h of the Public Authorities Law, enacted as part of the 2020 budget. Typically, we would defer to industry experts to argue the details of regulations, but this is a case where poorly conceived regulations will almost certainly present a significant obstacle to necessary improvements in our regional transportation infrastructure and, consequently, result in a negative impact on the economy of the city and state.
In short, the regulations make the risk associated with winning an MTA contract so extreme that responsible contractors are highly unlikely to bid. The unilateral risks imposed on contractors by these draft regulations are both substantive and political. The substantive risks relate to the fact that the MTA both defines the terms of contracts and change orders and is the sole arbiter in the event of disputes. The political risk is that the MTA is effectively controlled by the Governor and other elected officials who appoint its board and control its funding. For a contractor bidding on a large MTA procurement, these combined risk factors, under the terms of the proposed regulations, are impossible to effectively manage. As a result, responsible contractors are unlikely to participate in MTA procurement and the result will be the inability of the MTA to complete essential transportation infrastructure projects.
It is clear that some action was required to ensure that the MTA and its projects are not held captive by relatively few large vendors and contractors who are willing and able to do business with the authority. The threat of debarment for verified poor performance is a reasonable condition of procurement contracts. But the proposed regulations impose conditions that are impossible for responsible vendors and contractors to fulfill since a failure on the part of the MTA to perform its side of the contractual obligations is not accounted for. Unfortunately, it is the experience of virtually all MTA contractors that the authority is likely to be the primary source of time delays and cost overruns on major projects.
The transformation process being undertaken by the MTA, pursuant to the state budget, promises to result in more predictable costs and improved project management. This should result in more competition for MTA procurements and better performance by both the agency and its vendors. Unfortunately, as written, the proposed regulations on debarment threaten the progress toward a more efficient and predictable procurement process and better cost controls.
The Partnership urges the MTA Board to work with industry and business experts to adjust the proposed regulations on debarment to standards that improve performance without jeopardizing the authority’s ability to secure solid and competitive contracts. The Partnership would be willing to identify experts to help in this process and to develop regulations that protect the public interest while encouraging participation by top-quality contractors and vendors.
Four Companies Chosen for MTA Pilot Projects through the Transit Tech Lab
Press Conference Streamed Live at youtube.com/MTAinfo
At a press conference today, leadership from the Metropolitan Transportation Authority (MTA) and the Partnership for New York City jointly announced the successful completion of the Transit Tech Lab, an accelerator program that enables tech companies to test and introduce new products designed to improve transit services. Starting today, four of the six companies graduating from the accelerator will begin pilots with the MTA to implement products that address key subway and bus challenges.
“As the MTA experiences a period of historic reform, transformation, and innovation, we’re leveraging this new model for evaluating and introducing technologies that address some of our most critical challenges. The result is an inaugural Transit Tech Lab that far surpassed our expectations,” said Patrick Foye, Chairman & CEO of the MTA. “We are eager to develop these mobility technologies over the next year to improve subway and bus service for riders across New York City.”
“Thanks to the leadership of the MTA and the ingenuity of Transit Tech Lab finalists, New York City’s transit riders will benefit from mobility technologies designed to improve operations and customer service,” said Natalia Quintero, Director of the Transit Tech Lab.
Following a global competition last Fall, in which nearly 100 companies participated, six finalists were selected for the inaugural class of the Transit Tech Lab. Over eight weeks, the companies worked closely with New York City Transit and MTA personnel to test how their products could improve service and customer communications.
Two companies will advance to the pilot phase for the subway challenge:
- Axon Vibe provides smartphone app technology that enables public transport operators to deliver personalized communications based on users’ commuting behavior. If service is changed, MTA can proactively notify the impacted users (taking into consideration their location and context) and provide alternative transportation suggestions based on rider’s anticipated destination and commuting preferences.
- Veovo instantly measures the number of passengers moving through a subway station to identify crowding and make service more efficient. The MTA can use this information to improve the deployment of staff to stations, change train distribution and plan more efficient station design.
Two companies will advance to the pilot phase for the bus challenge:
- Preteckt studies vehicle data from buses to predict system failures at least 48 hours before the Check Engine light is activated and the bus must be removed from service. Preteckt’s insights have the potential to reduce time spent on maintenance, prevent service disruptions and reduce fleet costs.
- Remix provides software for designing transit systems that enables MTA planners to more quickly and efficiently produce the bus network redesign outlined in the Fast Forward NYC Plan. To ensure equitable access and support public engagement, Remix’s technology uses public demographic data and generates easy-to-understand transit maps for community feedback.
The Transit Tech Lab is managed by the nonprofit Transit Innovation Partnership, led by Rachel Haot, previously the first Chief Digital Officer for New York City and the first Chief Digital Officer for New York State, and the Partnership Fund for New York City, led by Maria Gotsch. It is modeled after the highly successful FinTech Innovation Lab that the Partnership Fund has run for the past nine years and played a critical role in establishing New York City as a hub for the global financial technology industry. The goal of the Transit Tech Lab is to establish New York as the center of innovation for mobility, particularly as it relates to public transit.
Today, the Partnership for New York City submitted testimony to the Taxi and Limousine Commission Hearing on High-Volume For-Hire Service Provider Congestion Rules
Thank you Chair Heinzen and members of the Taxi and Limousine Commission (TLC) for the opportunity to submit written comments on the proposed high-volume for-hire service provider (HVFHSP) rules. The Partnership for New York City represents the city’s business leaders and largest private sector employers. We work together with government, labor and the nonprofit sector to maintain the city’s position as a global center for commerce and innovation.
We urge the TLC to hold off on adopting proposed regulations that would prevent the issuance of new for-hire vehicle (FHV) licenses and limit FHV travel without passengers in Manhattan below 96th street. In the past year, the FHV industry has had to absorb many new rules and charges including the congestion surcharge and new formulas for paying drivers. The TLC should allow time to assess the impact of these rules on the industry, its customers and mobility throughout the city before taking further action.
For-hire vehicles have become a significant and valued part of transportation services in New York. As this industry matures, we should be seeking to ensure that it is competitive and responsive to needs of our very diverse communities. Over-regulation at this early stage in development of the industry risks market distortion and inadvertent bias for or against a business model or company.
FHVs are particularly important in transit deserts that are not well-served by public transit, where FHVs may be the only good option. To ensure adequate service to these areas, it is important that companies can license sufficient cars and drivers. The proposed cap on new licenses and driver pay rules may not support that objective. It is important to study how these rules affect citywide services before further regulating the industry.
Furthermore, high-occupancy FHVs should not be subject to the license cap or per capita charges that discourage shared rides. The TLC should exempt these vehicles in order to reduce congestion and advance environmental goals. The Partnership was an early supporter of congestion pricing and we are inaugural members of the OneNYC Advisory Board which has assisted in developing city initiatives that promote reduction in carbon emissions. Encouraging more shared rides in multi-passenger vehicles is part of these goals.
Op-Ed for the New York Daily News
The MTA bureaucracy has a history of paying consultants to tell them what they want to hear. In that sense, the report on MTA reorganization that was issued on Friday is a breakthrough.
AlixPartners, a consulting firm that specializes in restructuring troubled organizations, has put out an initial report that does not gloss over the serious problems confronting the MTA. It is honest about the current dysfunction of the regional transit system and presents some pretty bold ideas for how to fix it. Their straightforward approach was possible because the client for this report was not the MTA, but the governor and state Legislature, who ordered the preparation of a reorganization plan as part of this year’s state budget.
If successfully implemented, the recommendations outlined promise fundamental improvement in how the $18-billion-a-year MTA behemoth carries out its critical mission.
“The New York-New Jersey metropolitan region, with $1.8 trillion in economic output, is one of the largest regional economies in the world. To adequately service the employers and workers who generate this economic activity requires continuous investment in modernization and expansion of airports, rail and other transportation infrastructure. The business community fully backs the Port Authority of New York & New Jersey’s proposal to increase tolls and fares in order to fund the transportation projects outlined in the authority’s Capital Plan,” said Kathryn Wylde, President and CEO of the Partnership for New York City.
Today, the Partnership for New York City submitted testimony to the City Council in support of a plan for non-exclusive commercial waste zones, which will deliver environmental and safety improvements while ensuring good customer service and competitive pricing.
Thank you Chair Reynoso and members of the committee for the opportunity to testify on Int. 1574 concerning the establishment of commercial waste zones. The Partnership for New York City represents the city’s business leaders and largest private sector employers. We work together with government, labor and the nonprofit sector to enhance the economy of the five boroughs of New York City.
The Partnership has been a strong advocate of efforts to improve air quality and reduce traffic. We are inaugural members of the OneNYC Advisory Board which has assisted in developing city initiatives that promote reduction in carbon emissions and improved resiliency and public health. Commercial waste zones are one mechanism for advancing all these goals.
For more than two years, we participated in the Commercial Waste Zones Advisory Board convened by the Department of Sanitation (DSNY) and the Business Integrity Commission (BIC). The purpose was to gather input to inform the zone plan for commercial waste. The most important issue for the business community in these conversations is whether the zones would be exclusive (i.e., only one carter in each zone) or non-exclusive (i.e., multiple carters in each zone). It became clear to us and many members of the Advisory Board that the zone plan must not involve an exclusive franchise, or we will have a monopoly situation that works for no one, with the likelihood of reverting to the type of corruption that existing before BIC was put in place. We contend that non-exclusive zones can achieve environmental and safety objectives while still ensuring good customer service and competitive pricing.
Int. 1574 ignores the recommendations of the Advisory Board for non-exclusive zones for reasons that we do not understand. The Draft Generic Environmental Impact Statement (DGEIS) prepared by DSNY concluded that the lack of competition inherent in exclusive zones is likely to cause increased prices and a deterioration of customer service. Few carters have the capacity to exclusively service an entire zone, suggesting that this policy would result in most of the city’s commercial carters going out of business and creating a monopoly within zones. Customers would lose all bargaining power and incentives to provide good service would disappear.
The Partnership enthusiastically supports the DSNY/BIC plan for non-exclusive commercial waste zones, which is the product of extensive discussions with stakeholders and a recognition of the drawbacks to exclusive zones. The DGEIS found no significant differences in the reduction of vehicle miles traveled (a key measure related to truck traffic and emissions) between exclusive and non-exclusive zone plans.
We also urge that large commercial customers from whom waste is picked up and directly transported to a transfer station be exempt from zone requirements, since there would be no benefit of forcing them to use the zone hauler.
“The state legislature has come out with a reform package on rent regulations that protects tenants at the expense of preserving their homes. The city’s older, regulated apartment buildings require constant upgrading and modernization. The proposed reforms substantially eliminate the tools that owners, investors and lenders have relied upon for funding building improvements and provide no replacement. Absent provisions to encourage private investment in rental housing through tax incentives or other means, this rent reform package will inevitably lead to the same loss of decent, middle class housing that we experienced in the 1970’s and 1980’s. It is not enough to maintain affordability if it means tenants are living in terrible conditions, as we have seen with the deterioration of the NYCHA public housing stock. The proposed legislation sets up the city’s regulated rental housing to experience the same disinvestment as NYCHA, which ignores a lesson that we should have learned by now,” said Kathryn S. Wylde, President and CEO of the Partnership for New York City.
As Albany closes out the legislative session, some of the toughest remaining issues involve reconciling the different needs of the state’s diverse regions. One example is whether and how to extend residential rent regulations state-wide. Another, less well understood, is the debate over imposition of prevailing wage requirements for construction work on state-assisted, private development and renovation projects. (Prevailing wage typically reflects the wage established in collective bargaining agreements between the building trade unions and the industry.)
The impetus for expanding prevailing wage requirements comes from Upstate, where chronically weak economic conditions mean a lot of construction union members are out of work or under-employed. In many Upstate regions, construction workers are unlikely to command a “prevailing” wage unless the government requires it.
The same is not true in New York City and other Downstate regions, where union-built, private construction is booming, and Building Trades members enjoy full employment. In fact, right now there is a shortage of more than 4300 skilled workers to fill available construction jobs in the five boroughs. As a result, construction wages are already at a premium, without the need for any state mandate.
The challenge Downstate is not a shortage of jobs for union construction workers or the need to prop up union wages, but rather how to expand the supply of well-capitalized contractors and build a larger, highly skilled workforce that can meet the demand for renewal and expansion of our urban built environment.
A key benefit of many state programs is that they support a pipeline of private construction activity that is accessible to smaller, non-union contractors and workers drawn from the local community. This is precisely because they do NOT require prevailing wage and contractors that are party to industry collective bargaining agreements.
Grants and tax incentives provided through the state Housing Trust Fund, Regional Economic Development Council initiatives, the State Council on the Arts, NYSERDA, Empire State Development and other state agencies are largely directed into disadvantaged areas of the city and to nonprofit organizations. These state grants, loans or tax incentives represent a small portion of total funding for most projects. But they are necessary to close a gap and allow a project to move forward.
Importantly, these state-assisted, private and nonprofit projects offer local firms and workers, many of them minorities, a foothold in the construction industry that does not otherwise exist in the city, where barriers to entry are high. The construction activity they make possible is of little or no interest to the unionized industry, which has more than enough work to do on larger, more lucrative projects and has a high cost structure that would not allow them to bid competitively for this type of work.
In the prevailing wage debate, unions have proposed that any private construction or renovation activity that the state touches be declared a “public work,” comparable to subways, highways, schools and other public facilities. This would mean that projects that receive a modest government grant or tax incentive would be subject to the same rigorous compliance requirements as 100% government funded contracts. It is clear that the consequences would be far fewer projects built and displacement of many of the nonunion contractors and workers who are currently getting these jobs.
To address needs of Upstate, where unemployed construction workers don’t have much leverage, it might make sense to apply prevailing wage to those projects where the majority of direct funding (exclusive of tax incentives and tax-exempt bond financing) is coming from government. Studies show that this would increase project costs by as much as 30%, but it may represent a fair way to respond to concerns from some regions of the state where there is little private construction activity.
At the same time, the legislature should reject the imposition of public works status on the types of projects funded through its myriad housing, economic development and community facilities programs that involve a mix of public, private and philanthropic funds. Instead, there should be a concerted effort to integrate these programs with workforce development, training and Minority and Women Owned business development initiatives, doubling down on the creation of opportunities to expand and diversify the construction industry to meet demands in regions that are experiencing rapid growth.
At the end of a legislative session that has tackled many difficult issues, it must be tempting for legislators to just pass an intensely lobbied bill like expansion of prevailing wage and go home for the summer. Hopefully, that will not be the case, Albany will take the time to carefully consider regional needs, and act accordingly.
New York is a state where business and organized labor regularly work together to forge practical solutions to challenges that threaten our state’s economic vitality. That is the spirit in which we are jointly endorsing expansion of a natural gas pipeline known as the Northeast Supply Enhancement Project, or NESE.
We cannot afford for NESE to go the way of Amazon, which was driven out of New York by many of the same groups that are opposing the pipeline. We also cannot afford to lose access to relatively clean natural gas during the uncertain period of our state’s transition from dependence on oil, gas and nuclear power to a future where we will hopefully be able to meet most of our energy needs from renewable sources like wind, sun and hydropower.
Earlier this month, the application to build the pipeline was turned down by the New York State Department of Environmental Conservation on a technicality. We urge the developers of the pipeline expansion to pursue an amended application and hope that both New York and New Jersey regulators will move quickly to authorize a prompt construction start.
The entire state is at risk if NESE is not built. We all depend on the payrolls and tax revenues generated by the metropolitan region. Already there is a looming moratorium on new, gas-powered buildings here. As much as $300 billion in new development is at risk if the pipeline is not constructed. Even worse from an environmental point of view, a gas moratorium will force many new buildings to revert to oil-powered systems — an option that no one should welcome.
As more companies and consumers have moved away from oil as their primary energy source in order to reduce carbon emissions, the demand for natural gas has dramatically increased. The scheduled closing of the Indian Point nuclear plant, which has been a major source of clean energy, has made dependence on natural gas even greater.
Downstate’s fastest-growing industry is technology, which requires a huge amount of power to support its equipment, operations and data centers. Other big industries like finance and health care are also increasingly dependent on technology, so their needs for power are larger than ever.
Until the last year or so, it seemed that good sense would prevail over the objections of advocacy groups and political interests that insist on cutting off construction of any new infrastructure that sustains the natural gas supply in order to try forcing a faster conversion to renewables. The anti-fracking movement generated a lot of misinformation about the natural gas supply that has contributed to opposition to essential infrastructure like the NESE.
We should all share a commitment to moving as quickly as possible to energy sources that do not contribute to climate change, but we also need to be realistic about how long this may take.
Above all, let’s be practical. As it stands, renewables cannot meet New York’s enormous energy demands. It will take many years before that changes. National Grid has said that nearly 8,000 planned oil-to-gas residential conversions annually will be put on hold if NESE is not approved. In addition, planned conversion of major commercial buildings, including public housing, will be halted and will continue to depend on dirty oil for heat — a net loss for New York’s environmental, public health and clean air goals.
On behalf of the Partnership for New York City, which represents more than 350 major employers and 1.5 million workers in New York, as well as the NYS Building & Construction Trades Council, which represents 200,000 construction industry workers and a network of more than 2.5 million workers in the state’s AFL-CIO, we support the governor’s commitment to a carbon-free New York. However, we are also pragmatists. It is a fact that there is simply not enough renewable energy available right now to meet the growing demands of the Downstate region. We need the NESE pipeline.
Today, the Partnership for New York City testified before the City Council to oppose legislation that would require private employers to provide paid vacation time to employees.
Thank you Chair Miller and members of the committee for the opportunity to testify on providing paid vacation time to private employees. The Partnership for New York City represents employers of a million private sector workers in the city.
The Partnership opposes Proposed Int. 800-A as an imposition on the decision of what benefits private sector employers will provide their employees. Adding ten vacation days to the five mandated paid sick days would triple the amount of paid time off for New York City employees. It would require little or no notice to employers and would substantially add to the administrative and cost burdens that the city and state have placed on employers.
These burdens are particularly difficult for small businesses to bear. They do not have legal departments to interpret new laws or human resource professionals to manage the compliance and recordkeeping for new mandates. Empty storefronts, which the Council is concerned with, are a symbol of the impact of a less-friendly business climate in the city. This is in part a result of the growing cost of new mandates, ranging from increased minimum wage to new scheduling restrictions and new training requirements that employers must comply with.
Most large employers provide paid time off, often more than would be mandated under the proposed legislation. But every company has different practices with respect to how and when this leave is taken, depending on their individual business requirements. For example, many employers incentivize employees to take time away from work by requiring them to take all of their leave time each year. Other employers allow carry over of a limited amount of unused leave time, but policies vary widely in the amount and type of time that can be rolled over. Most large employers have operations outside the city and their leave policies are difficult to change in response to local law.
There is no clear reason why the City Council should impose a single paid time off policy on all New York City employers. Certainly the specific prescriptions in this bill leave little room for policies that reflect the needs of individual businesses or the extent of the hardship that this may impose on some employers. We recognize the political impetus for the legislation and urge that, if you are moving forward, that the law exempt business with fewer than twenty employees and all those employers who certify that they are already providing at least fifteen days of paid time off pursuant to collective bargaining agreements or their own benefit arrangements. This would at least mitigate the negative impact of the bill.