7/10/2014 Port Authority Funding Under Scrutiny- VVSJ 

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Port Authority Funding Under Scrutiny 

Legislators Seek to Shine Light on Pot of Money Spent on Projects Far Afield 

By HEATHER HADDON 

July 10, 2014 12:01 a.m. ET 

For more than three decades, the Port Authority of New York and New Jersey has spent hundreds 

of millions of dollars on projects that have little to do with its mission, paying for museums, parks 

and even a clam-processing plant. 

The money has flowed on both sides of the Hudson River, helping governors and the agency build 

projects-and goodwill-in communities. 

Now, New Jersey lawmakers are planning to shine a light on a source of that funding, a pot of 

funds known collectively within the agency as the "regional banks." 

Port Authority Projects 

Related 

Christie's Port Nominees Have Confirmation 

Hearings 

will end the bank funds. 

As the Port Authority's operations come under 

intense scrutiny after the George Washington 

Bridge scandal, some lawmakers are calling for 

abolishing the regional-banks spending. They say 

the agency should focus on its own assets in dire 

need of repair, such as the Port Authority Bus 

Terminal, and overcrowded airports. 

"Every motorist paying tolls to cross the Hudson is 

being charged an extra $2 per ride to pay for these 

grants while needed infrastructure improvements go 

wanting," New Jersey Sen. Ray Lesniak, a 

Democrat, said in a recent letter to the Port's 

executive director advocating for the funds' end. 

On Thursday, at a Senate Judiciary Committee 

confirmation hearing, Mr. Lesniak said he intends to 

question Republican Gov. Chris Christie's nominee 

to lead the Port Authority's board, former state 

Attorney General John Degnan, about whether he 

Others have criticized the use of the funds. U.S. Sen. Charles Schumer of New York has 

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7/10/2014 Port Authority Funding Under Scrutiny- WSJ 

questioned why the states weren't paying for some of the projects funded through the Port 

Authority bank through their own budgets. 

Some Port Authority officials have begun to agree and internal talks are under way about whether 

to abolish them, senior agency officials said. 

The agency's capital plan running through 2023 authorizes $942 million in regional funds, out of a 

total $27.6 billion budget, but they have yet to be authorized by the Port Authority board. 

In a statement, a spokesman for Mr. Christie said a Port Authority reform panel is reviewing the 

structure of the agency, including if it "can better conform with its core mission." 

The biggest Port Authority project to come under scrutiny is the rebuilding of the Pulaski Skyway, 

the 31/2-mile bridge connecting Newark to Jersey City over the Hackensack and Passaic rivers. 

Manhattan prosecutors and the U.S. Securities and Exchange Commission are investigating 

whether the use of $1.8 billion in tax-exempt bonds originally procured to build a rail transit tunnel 

under the Hudson River were improperly tapped by the Christie administration to repair the Pulaski 

Skyway bridge, according to several people familiar with the investigation. Spokeswomen for the 

SEC and the Manhattan district attorney's office declined to cornrnent on the investigation. The 

Record has previously reported the Pulaski investigation. 

A Port Authority spokesman said the Pulaski Skyway was analyzed and negotiated by lawyers on 

all sides, and outside legal counsel provides opinions on all of the agency's bonds. 

A summary of New Jersey expenditures from 1983 to 2008 showed that a total of $337.5 million in 

funds had been allocated to 36 projects, according to an internal memo reviewed by The Wall 

Street Journal. 

According to the list, the projects included $12 million for Stevens Institute ofTechnology, a private 

college in Hoboken; $19 million for Civic Square, a building in New Brunswick; $900,000 for the city 

of South Amboy, N.J.; $5 million to Jersey City Medical Center; and at least $4 million for 

Independence Park, a Newark space run by Essex County. 

The document also listed $1.3 million for a "clam depuration plant," an investment in the Sandy 

Hook Bay that speeds up the process of purifying shellfish from contamination. Another $25 million 

was given to loan guarantees by the New Jersey Economic Development Authority, which provides 

financing and tax incentives to businesses. 

One of the largest shares of funds went to road work in New Jersey, including more than $92 

million to improve the old Route 169 highway-now Route 440-that runs along Bayonne. 

A comparable list of New York projects wasn't available. 

Recipients say the money was spent wisely. A spokesman for Jersey City Medical Center said the 

funding was helpful in establishing a regional trauma center that serves Port Authority facilities in 

the region and they have not received any additional agency grants since at least 2004. 

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7/10/2014 Port Authority Funding Under Scruli ny- VI/SJ 

Such spending began in 1983, when the governors of New York and New Jersey pushed the Port 

Authority to support programs deemed essential to the region's economy. The Bank for Regional 

Development was established with an estimated $250 million in capital funds, with 55% going to 

New Jersey and the rest to New York. 

The regional bank has come to include a variety of other spending accounts, including the "Hudson 

Raritan Estuary Resource Program" for both New York and New Jersey, an account for 

environmental land acquisitions, and accounts for economic development, among others. 

A list of individual projects hasn't typically been disclosed by the Port Authority, although the total 

amount of regional-bank funds spent are generally reported in the agency's capital plan. 

-Ted Mann contributed to this article. 

Write to Heather Haddon at heather.haddon@wsi.corn 

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