City could be on the hook for $96M in unexpected costs at Hudson Yards
Costs spring from No. 7 subway extension, park
The city may be on the hook for nearly $100 million in unexpected additional costs related to redeveloping Hudson Yards, according to a new report.
The Independent Budget Office found that an additional $96 million is needed to fund the extension of the No. 7 subway line and the planned four acres of park and open space known as Hudson Park & Boulevard. The construction of the latter is expected to cost an additional $64 million, while the subway extension would require another $32 million, according to the report.
It’s not yet clear how the additional expenses will be funded. The development corporation has already issued the maximum amount of completion bonds ($3 billion) approved by the city, so the City Council would need to sign off on any additional bonds.
Under the Bloomberg administration, the Hudson Yards Infrastructure Corp., a subsidiary of the city’s Economic Development Corporation, issued $2 billion in bonds in 2007 and another $1 billion in 2012 for the subway extension and other infrastructure improvements. Last month, the city refinanced portions of this funding.
Representatives for the EDC didn’t immediately respond to a request for comment.
The city has also granted several tax breaks at Hudson Yards to encourage development. In January, the city approved $177 million in tax breaks to Related Companies and Oxford Properties Group, the companies charged with redeveloping a majority of the 26-acre site. The city also approved a tax break valued at $330 million for 30 Hudson Yards.
Related and Oxford are seeking $380 million in EB-5 funding 35 Hudson Yards and 55 Hudson Yards.
According to the IBO’s report, the city expects to spend $266 million of its own capital funds by 2021 on projects related to the Hudson Yards redevelopment. In 2005, the city expected to only spend $128 million.
(To view new construction projects at Hudson Yards, click here)