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Underground Man

Real-estate tycoon Peter Kalikow is rewriting his legacy by presiding over the biggest expansion of New York’s transit system in 60 years. And the Second Avenue subway is only part of the MTA chairman’s plan.


Train Man: MTA Chairman Peter Kalikow in one of his cars.  

Riding uptown in his chauffeur-driven Lincoln one recent snowy morning, MTA chairman Peter Kalikow was worried about his switches. All through this unusually frigid winter, the cold has caused Metro-North and Long Island railroad switches to freeze, playing havoc with train schedules and Kalikow’s peace of mind.

“You cannot believe what the weather does to our system,” he says, shaking his head in frustration. “All the maintenance, all the track work, all the attention to detail goes out the goddamned window because of the cold. Unbelievable.”

It seems an odd thing to have to fret about for someone at Kalikow’s point in life. Rather than sit on a few corporate boards and attend fund-raisers, the man who spent three decades building high-rise towers, once owned the New York Post, and was the financial architect of Alfonse D’Amato’s Senate career is consumed with the grinding task of overseeing a public-transportation network that employs 65,000 people and serves 8 million riders a day (3 billion a year). It is a job in which he gets blamed for every closed token booth, dirty subway car, and broken escalator.

People often ask him why he subjects himself to the rigors of the chairmanship when he could be doing just about anything else. “I had no idea what I was getting into,” he sometimes smiles and says.

But the truth is more complicated. After surviving a painful, highly public bankruptcy in the early nineties, Kalikow was determined to give something back. The impulse is part altruism, part effort to erase the blot on his record through achievement.

Kalikow likes to say he doesn’t want anything from the job (“What could I want? I have everything”), but, of course, that’s not entirely true. Making money is no longer paramount. “I do this,” he says, “because I want my legacy to be something other than money.”

Though Kalikow has already changed the MTA in significant ways—he’s instituted management reforms to ensure increased accountability and efficiency, and put more transparency in the budget process—he has staked his legacy on expansion. The MTA is about to begin the largest, most far-reaching construction of public-transportation facilities in the city in more than 60 years. It is the kind of infrastructure-building program that will dramatically affect life in New York for decades.

Kalikow believes his experience as a developer has uniquely prepared him for this challenge. He knows how to manage megaprojects (“I’ve been known to have the ability to make sure people do what they’re supposed to when I want something done”) and has the vision to see and understand what the construction will mean to New York 30 or 40 years from now. “They left us a system that’s gone 60 years without expansion,” he says. “And in truth, we weren’t ready to expand. We didn’t really know how to run a system. Now we’ve proved we can do it, and that’s why we can ask for the money. It’s time.”

First up is what’s referred to as East Side Access. At a cost of $6.3 billion, this project will enable Long Island Rail Road trains to go directly into Grand Central Terminal. Right now, 40 percent of all LIRR riders are forced to backtrack to get to the East Side once they reach Penn Station. In addition to saving commuter time and energy, East Side Access would ease the burden on buses, subways, and taxis.

“I told Alfonse, ‘If you screw around, I’m going to kill you. I want to be a success here, and you’re going to help me.’ ”

The MTA plan calls for construction of a whole new level of platforms deep in the bowels of Grand Central and what may by the world’s longest escalator: ten stories. Kalikow says the MTA is in final negotiations with the federal government for funding. “We want them to cover 50 percent of the cost,” he says. “We have a very good shot at getting this done before Congress breaks for summer recess in July.”

The MTA, in fact, has already spent nearly a third of what its portion of the project would be, on excavation and track work in Sunnyside. If the federal money is appropriated, construction should be completed between 2010 and 2012.

The other project Kalikow believes will begin by year’s end is the long-hoped-for Second Avenue subway. “It’s the most famous thing that’s never been built in New York,” says Gene Russianoff, a lawyer with the Straphangers Campaign.

With a price tag of $17 billion and a fifteen-year timetable for construction, it’s a much more complicated project than East Side Access. The new line would run from 125th Street to the southern tip of Manhattan. Also moving forward is a $400 million reconstruction of the South Ferry station and a smarter, more user-friendly $750 million redesign of the maze of stations and eight or nine subway lines that come together at the Fulton Street–Broadway Nassau complex. This will be done with already-allocated federal 9/11 funds.

Though few would argue against the need to expand the system—bus ridership is up 46 percent and subway-rail ridership is up 35 percent—specific choices are another matter. East Side Access is the pet project of Governor George Pataki. Both he and D’Amato made it a campaign promise in 1998, knowing the appeal it held for suburban voters.

Kalikow’s ties to both men have opened the door to criticism that he is simply doing the governor’s bidding. The Second Avenue subway, on the other hand, has long been championed by State Assembly Speaker Sheldon Silver, a Democrat, who represents the Lower East Side. “My complaint is not with the choices themselves,” says Congressman Jerry Nadler. “It’s with the way they’re made. The projects picked are the ones with the most political clout.”

Kalikow argues that yes, the choices are political in the sense that one elected official or another’s constituents will always benefit from public construction. “But that’s not how we make decisions. We’re trying to serve the most people possible, and all of these projects are heavily reviewed. However, if a project we select happens to benefit a certain important state leader who lives in Albany, I won’t lie to you. I’m not annoyed by that.”

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