It Starts In A Hole

Maybe you were wondering how the City will pay for the $2.1 billion 7 train extension to an undeveloped part of Manhattan. So are they:

Now that there are a handful of giant holes under Chelsea for the line, and soon to be two drills that are making tunnels, the likelihood that the project will actually come to fruition is increasing substantially (though no one has agreed to pay for cost overruns yet). But with the economy in shambles, the question becomes how quickly — or slowly — development will sprout up on the far West Side.

This is more than just an academic question. To fund the $2.1 billion budgeted for the extension, the city sold bonds that are to be repaid with the extra taxes expected from all the new development on the West Side. If development takes years to begin — or never happens — the city would need to use money out of its budget to pay the $100 million or so annually in debt service, adding to an already high debt burden.

At the announcement today, the mayor delivered what sounded like a slight plea to developers to get building again.

“If anybody’s a developer out there, and if you want to know a good time to start, I can’t think of a better time,” he said. “People are ready to take the jobs, you can buy concrete and steel a lot cheaper than you could have before, and you’ll have these buildings ready when our economy comes roaring back and people are going to need space.”