Port of New York and New Jersey release preliminary 2010 budget

Includes $3.1 Billion Investment in Capital Projects, Including WTC and ARC

The Port Authority today released for public review a preliminary $6.3 billion budget for 2010.

In response to the economic downturn, which has significantly reduced the Port Authority's financial capacity, the preliminary budget calls for zero growth in operating expenses for the second straight year. The preliminary budget also reduces agency headcount by 150 positions, bringing staff levels to the lowest in 40 years. Taken on top of previous staff reductions, the Port Authority has now eliminated more than 500 non-police positions since 2004, a 9 percent reduction.

The preliminary budget also calls for other cost-control measures including: a 20-percent reduction in overtime and a 32-percent reduction in external consultants. These and other cuts are necessary to help counter the effect of an economic downturn that is expected to reduce facility activity more than originally forecasted.

The fiscal discipline on the operating side of the preliminary budget allows for $3.1 billion in capital spending - enough to keep priority projects moving forward and to maintain agency facilities in a state of good repair.

Because of continued financial discipline in operating expenses and prioritization of capital spending, the preliminary budget calls for no increases in tolls and fares.

Port Authority Chairman Anthony R. Coscia said, "Especially in tough economic times, we must do everything we can to spend the public's money wisely. That's why for 2010, once again, our proposed budget includes zero operating growth. Saving money on the operating side will help us meet the region's critical need for new transportation projects."

Port Authority Executive Director Chris Ward said, "The Port Authority is not recession-proof. Like all public agencies, we have been hit hard by the economic downturn and have made difficult decisions to make certain our spending lives within our means. This budget meets our critical spending priorities, 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 preliminary 2010 budget calls for $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 preliminary 2010 operating budget include:

* Zero growth in operating spending in 2010, continuing the fiscal discipline of the last several years. Operating spending growth was also 0 percent in 2009, 0.9 percent in 2008 and 1.1 percent in 2007.
* Headcount reduction of 150 positions, bringing staffing levels for 2010 to 6,977, the lowest in 40 years, compared to 7,127 in 2009.
* Cutting overtime by 20 percent, or $24 million, as a result of efficiencies and new management control strategies.
* Cutting the use of external consultants by 32 percent, or $15 million.
* Closing the Ramada Plaza Hotel at JFK International Airport because of declining aviation activity and a need for substantial renovation. The closing will save the agency $1 million per month.
* An investment of $444 million in operating costs for facility security and $326 in capital security projects, bringing the Port Authority's total investment in security to $5.2 billion since 9/11.
* A commitment of $21 million toward ongoing conservation and environmental programs to reduce greenhouse gas emissions, a new Clean Trucks Program to finance replacement of older, more polluting trucks at the port facilities, and other regional investments in green projects.

Major highlights of the Port Authority's preliminary 2010 capital budget include:

* Continuing development of the World Trade Center site.
* Investing in the continued construction of the ARC Tunnel project.
* Continuing investments in the PATH Modernization Program, including funds to continue to replace the 340-car fleet and to install a new signal system.
* Advancing the JFK Flight Delay Reduction Program, in addition to modernizing Stewart International Airport and planning for the future modernization of Terminal A at Newark Liberty International Airport and the Central Terminal Building at LaGuardia Airport.
* Continuing the 50-foot channel-deepening program in the Port of New York and New Jersey.

The preliminary budget is being released in advance of the Board of Commissioners vote on the final plan, scheduled for December 10. It is available on the Port Authority's Web site - www.panynj.gov. Members of the public are urged to comment via the feedback feature on the Web site.