Where There Are Identifiable Problems, There Are Workable Solutions

For starters, Penn Station needs a unified, central concourse providing access to all platforms from the same location. The closest thing to a unified concourse that Penn Station currently offers is the Exit Concourse, which, as the name implies, is meant to provide the efficient dispersal of arriving passengers. However, the Exit Concourse is not without its own deficiencies. To begin, since the Exit Concourse is not centrally located, it is not accessible from the NJ Transit concourse. Getting to the Exit Concourse takes a map, some walking shoes, and a few staircases. However, once you have reached the Exit Concourse, you cannot see beyond the platform or two directly in front of you due to the barrage of infringing support columns (one of the downsides of locating a major transit hub beneath a sports arena). And if you have the fortune of arriving early to your designated platform, there is nowhere to sit, no place to eat, and no shopping available within the Exit Concourse.

Penn Station also desperately needs open air spaces. When capacity is tight, one of the few comforts that could ease the ubiquitous claustrophobia within Penn Station is a high-ceilinged room with natural sunlight. From a floor plan perspective, Penn Station dwarfs Grand Central Terminal in terms of total square footage. However, because of its soaring ceilings and open concourses, Grand Central Terminal appears to be much more expansive and provides a more enjoyable travel experience. Any new construction on rail facilities within New York City that involves passenger movement should require the inclusion of cavernous spaces, which would ensure that commuters do not feel punished every time they find themselves waiting for a train.

From an oversight perspective, Penn Station also needs to reform the bureaucratic and political hierarchy in its operation and financing. Penn Station and its tracks are owned outright by Amtrak, which is operated and financed by the federal government. The members of Amtrak’s board of directors are appointed by the President of the United States and are subject to confirmation by the United States Senate. NJ Transit and LIRR, on the other hand, are operated and financed by their respective state governments. NJ Transit is funded and governed by the State of New Jersey and LIRR is funded and governed by the MTA, a transportation agency of the State of New York. Both NJ Transit and LIRR have entered into leasing agreements with Penn Station Leasing, LLC, a wholly-owned subsidiary of Amtrak, for the right to use both Penn Station’s tracks and facilities. This means that if NJ Transit needs to expand its trackage or if LIRR needs to renovate the public areas around its main concourse, it must get express approval from Amtrak. However, unlike NJ Transit and LIRR, who depend on Penn Station to fuel the transit systems of their respective states, to Amtrak, Penn Station is one of over 500 stations it services in 46 states and Canada. LIRR and NJ Transit answer to the people of New York and New Jersey; Amtrak answers to the federal government.

In terms of budgeting, Amtrak has, over the past three years, received federal subsidies averaging $1.5 billion and has seen ridership steadily climb from around 21 million passengers in 2000 to over 31 million passengers in 2013. However, despite this apparent growth, Amtrak has operated at an average loss of over $1.2 billion since 2009. As the chart above indicates, curiously, as Amtrak’s ridership increases, its yearly operating losses continue to grow in the negative. How is it that Penn Station’s owner could be so far in the red? The explanation is that despite its apparent success within Penn Station and even the Northeast Corridor, the remainder of Amtrak’s operations are highly unprofitable. As a result, Amtrak looks to Penn Station as a tentpole to prop up its losses elsewhere in the country.

As Amtrak continues to lose over a billion dollars each year, NJ Transit and LIRR would be justifiably concerned that its financially unstable landlord may be pressured to squeeze additional capital out of Penn Station in order to refinance its less successful sectors. This fear was indeed realized in 2001, when Amtrak was forced to put up Penn Station as collateral for $300 million in loan guarantees. As party politics increasingly threaten federal transportation funding, there are no assurances that Amtrak will continue to receive the vast federal subsidies upon which it relies. Amtrak may be required to raise rents, sell off transit space, or at best, just neglect to make much-needed improvements throughout the station. In order to avoid these potential problems, the operator of New York’s premiere transit hub needs to have both unified interests with the passengers it serves as well as sound financial footing.

It must also be noted that Amtrak is in direct competition with NJ Transit for passengers along the Northeast Corridor (which is also owned by Amtrak and leased by NJ Transit). For instance, a person wishing to travel from Penn Station to Trenton, NJ at noon on a weekday has the option of either taking a 90 minute NJ Transit train for $16 or a 50 minute Amtrak train for $40. While the relationship between Amtrak and NJ Transit is currently civil and complementary, Amtrak holds all of the cards. Further, Amtrak’s monopolistic control of Penn Station is at odds with its little relative use of the rail hub; on a given weekday during peak hours, Amtrak comprises only 3% of the station’s ridership. It is simply bad public policy for NJ Transit and LIRR commuters to rely upon an at-capacity station run by an unprofitable landlord who also happens to be a competitor. Competition is a good thing, but Amtrak currently has a monopoly over NJ Transit’s service to Manhattan.

Perhaps most importantly, Penn Station needs to drastically alleviate its capacity constraints. This can be accomplished in one of two ways. The first way is to increase the supply of tracks and platforms within Penn Station to ease the problems associated with overcrowding and delay. However, a minor capacity upgrade would be shortsighted and would effectively amount to “kicking the can down the road.” As illustrated by the chart above, since Amtrak took control of the Northeast Corridor in 1976, the number of weekday trains in and out of Penn Station has nearly doubled. Still, there are currently no proposals that address the increases in ridership that are projected to occur over the next 35 years, likely because Penn Station would need to add a significant number of tracks and platforms to satisfy this ever-growing demand. Given Penn Station’s location and space constraints, effectively doubling train capacity would prove prohibitively expensive, if not technically impossible.

The second, and more effective, way to improve Penn Station’s capacity constraints is to reduce the demand for travel into Penn Station. This idea is already being implemented for LIRR by the MTA through the East Side Access project, which seeks to reroute a number of LIRR trains into a new eight-track station below Grand Central Terminal. This will provide commuters from Long Island the option of traveling to either Penn Station or Grand Central Terminal depending upon their ultimate destination. However, both Amtrak and NJ Transit still utilize only one Manhattan terminus and one pair of tunnels to enter New York City from New Jersey. In order to responsibly and permanently address the growing demand for rail travel in the metropolitan region, a third Manhattan transit hub must be built to increase cross-Hudson capacity and reduce the demand for ridership into Penn Station.

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