Spitzer Pushes Plan to Save Moynihan Station

Gov. Eliot Spitzer’s rescue plan for the Moynihan Station project may involve having the Port Authority of New York and New Jersey take control of plans from another agency, build a new Pennsylvania Station and transform the surrounding neighborhood with a half-dozen skyscrapers.

The project, which calls for relocating Madison Square Garden a block away and constructing a grand new train station in Manhattan at 33rd Street, between Seventh and Eighth Avenues, has neared collapse because of shortfalls in government financing, logistical problems and political inertia.

Over the last week, Governor Spitzer has assured the developers — Steve Roth of Vornado Realty Trust and Stephen M. Ross of Related Companies — and the owners of the Garden that the project will move forward. He told them that the state is willing to increase its contribution to rebuilding Penn Station to as much as $600 million, as long as the city does the same, according to executives who attended a recent meeting on the plan.

Mr. Spitzer also wants the developers to put up more than the $550 million they have promised, in return for lucrative development rights to build the skyscrapers. But even if they whittle the cost of the train station to $2.4 billion, from the current $3 billion estimate, there is still a substantial shortfall, $650 million.

That’s where the Port Authority comes in. Proponents, who include the developers, say that Port Authority would bring to bear their expertise with large transportation-oriented projects and a pile of money. Two senior executives of the authority expressed interest in the project, but requested anonymity because they did not want to get ahead of Governor Spitzer.

The developers have also come up with a “flip” that they hope would quell criticism from preservationists who complain that the Garden’s proposed arena in the James A. Farley Building, the post office just east of Penn Station, would destroy the historical integrity of the building. Under this concept, the Garden patrons would enter the Farley building through doors at street level, instead of mounting the grand staircase on Eighth Avenue and entering under the colonnade, which would require making changes to the landmark building.

But the proposal concerning the Port Authority has run into resistance from the Metropolitan Transportation Authority, according to state officials and Port Authority executives, because they want the same money for construction of the Second Avenue subway. At the same time, the officials say that Patrick J. Foye, co-chairman of the Empire State Development Corporation, which oversees the Moynihan project, is reluctant to cede control to the Port Authority.

Assemblyman Richard L. Brodsky, a Democrat from Westchester, said he opposed transferring the project to the Port Authority, which, he said, would be tantamount to allowing the developers to “cherry pick” the agency that gives them the best deal. He said Mr. Foye has pushed the developers to make more concessions.

Tired of the delays, the Garden has continued talking to Mr. Spitzer, while dusting off their fallback plan: to simply renovate the existing drum-shaped arena between Seventh and Eighth Avenues. In 2004, the Dolan family, which controls the Garden, the Knicks and the Rangers, had announced that it wanted to rebuild the arena’s seating bowel, install new luxury suites, add restaurants and widen the arena’s corridors, at a cost of $350 million.

Under that plan, the Garden has talked to the developers recently about keeping the arena in place, but moving its 5,600-seat WaMu theater from Eighth Avenue to the rear of the Farley building, which would still be converted to an adjunct train station. Advocates say the theater could enliven the Ninth Avenue entrance to the Farley building and would not require many of the structural changes opposed by preservationists.

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