Port Authority reacts to scathing audit

Two days after a scathing audit referred to the Port Authority as dysfunctional and wasteful, its top officials Thursday agreed that changes must be made to the organization's practices.

"This has been a great, perhaps the greatest public planning and engineering authority in the world for 92 years," said Port Authority chairman David Samson, adding the report "received the focus and full attention of the board and we will implement many of the recommendations and findings."

Vice chairman Scott Rechler said that after a decade in which the authority went through seven executive directors, four New York governors and five New Jersey governors, leadership is finally stable enough to look into the problems the authority has developed.

"While the report is disappointing, it's not a surprise," he said.

The audit, from Chicago-based consulting firm Navigant, called for a "top-to-bottom overhaul" of the agency and cited its poor management of capital projects and inadequate cost controls, which led to billions of dollars in cost overruns in the rebuilding of the World Trade Center.

It found that the estimated cost ballooned from $11 billion in 2008 to about $14.8 billion now.

Samson and Rechler said that the $3.8 billion difference is due to understated cost estimates in 2008. Rechler said that the original $11 billion estimate didn't include many marginal costs that tend to pile on to a project as big as the World Trade Center rebuilding, including getting the Sept. 11 Memorial ready for the 10th anniversary of the attacks.

The audit also noted that 93 percent of authority employees made no contribution toward their pensions or benefits.

Govs. Andrew M. Cuomo of New York and Chris Christie of New Jersey ordered the audit after the authority increased bridge and tunnel tolls last summer.

Samson defended the decision to hike fares and said that toll revenue goes toward paying for roads and other infrastructure in New York and New Jersey.

"Not a dollar of toll revenue has, is now or will ever go outside the interstate transportation network," added Patrick Foye, executive director of the Port Authority.

The Navigant report was the first part of the audit. The second report, which focuses on how the authority prioritizes capital expenditures, is expected in June.