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Breaking New Ground 2017 Annual Report

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Breaking New Ground 2017 Annual Report BREAKING NEW GROUND 2017 Annual Report Comprehensive Annual Financial Report for the Year Ended December 31, 2017. Our Mission Meet the critical transportation infrastructure needs of the bi-state region’s people, businesses, and visitors by providing the highest-quality and most efficient transportation and port commerce facilities and services to move people and goods within the region, provide access to the nation and the world, and promote the region’s economic development. Our mission is simple: to keep the region moving. 2 THE PORT AUTHORITY OF NY & NJ TABLE OF CONTENTS I ntroductory Section 2 Origins of The Port Authority of New York and New Jersey 3 Letter of Transmittal to the Governors 4 Board of Commissioners 5 Leadership of the Port Authority Our Core Business Imperatives 9 Investment 10 Safety and Security 11 Integrity 12 Diversity and Inclusion 13 Sustainability and Resiliency Major Milestones By Business Line 15 2017 at a Glance 16 Aviation 20 Tunnels, Bridges & Terminals 24 Port of New York and New Jersey 28 Port Authority Trans-Hudson Corporation (PATH) 30 World Trade Center Financial Section 32 Chief Financial Officer’s Letter of Transmittal to the Board of Commissioners 35 Index to Financial Section Corporate Information Section 126 Selected Statistical, Demographic, and Economic Data 127 Top 20 Salaried Staff as of December 31, 2017 The Port Authority of New York and New Jersey Comprehensive Annual Financial Report for the Year Ended December 31, 2017 Prepared by the Marketing and Comptroller’s departments of The Port Authority of New York and New Jersey 4 World Trade Center, 150 Greenwich Street, 23rd Floor, New York, NY 10007 www.panynj.gov BREAKING NEW GrounD 1 The Port District includes the cities of New York and Yonkers in New York State; the cities of Newark, Jersey City, Bayonne, Hoboken, and Elizabeth in the State of New Jersey; and more than 200 other municipalities, including all or part of 17 counties, in the two states. ORIGINS OF The Port Authority was established by the Compact of April 30, 1921, between THE PORT AUTHORIty the States of New York and New Jersey as one of the first interstate agencies OF NEW YORK created under the clause of the United States Constitution permitting compacts AND NEW JERSEY between states with the consent of Congress. The Compact, designed to improve the region’s economic health, also created the Port District, which comprises an area of about 1,500 square miles in both states, centered about New York Harbor. In the nearly 100 years since then, the Port Authority’s mandate has evolved to promote and protect the commerce of the bi-state port region, as well as to undertake improvements to regional transportation: modern wharfage for the harbor shared by the two states; tunnel and bridge connections between the states; airports; terminal and transportation facilities, such as the Port Authority Trans-Hudson (PATH) rail system; the World Trade Center; and, in general, trade and transportation projects to promote the region’s well-being. 2 THE PORT AUTHORITY OF NY & NJ LETTER OF TRANSMITTAL TO THE GOVERNORS THE HONoraBLE THE HONoraBLE ANdreW M. CUomo PHIL MUrpHY Governor, State of New York Governor, State of New Jersey Dear Governors Andrew M. Cuomo and Phil Murphy, On behalf of the Board of Commissioners, we are pleased to present to you and to the legislatures of New York and New Jersey the 2017 Comprehensive Annual Financial Report of The Port Authority of New York and New Jersey. The title of this annual report — ”Breaking New Ground” — reflects the agency’s commitment not only to move its major infrastructure projects forward aggressively, but also to do things differently — with a renewed focus on customer service and global best practices in all areas, and with a stronger-than-ever commitment to the highest levels of ethics and integrity. As you know, the Port Authority faces a pressing need to overhaul its infrastructure, while simultaneously expanding capacity to address the region’s growth and continuing to protect the security of the traveling public. In 2017, the agency addressed these needs. Early in the year, the Port Authority adopted a $32.2 billion 10-year Capital Plan, the largest ever approved. And the agency then initiated several critical construction projects. In August, in partnership with Delta Air Lines, the agency broke ground on the eastern half of LaGuardia Airport’s (LGA) $4 billion redevelopment in Delta’s terminal area. The $4 billion Delta project added to work already underway on the western half of the airport, which means the $8 billion LGA rebuild is fully underway — the first entirely new airport in the U.S. in 20 years. In June, the Port Authority announced the construction of a brand-new Terminal One at Newark Liberty International Airport (EWR). This $2.3 billion construction project will not only bring a state-of-art terminal to EWR but will also rebuild surrounding taxiways to bring the airport’s infrastructure up to 21st-century standards. Earlier in the year, Governor Andrew M. Cuomo’s Airport Advisory Panel presented a new vision for John F. Kennedy International Airport (JFK) as a unified, interconnected, world-class facility. And in July, the Port Authority initiated early-phase planning and engineering work expected to lead to an approximately $10 billion JFK redevelopment program, which leverages private investment. Beyond the airports, a number of critical projects marked major milestones in 2017. Among them were achieving navigational clearance at the Bayonne Bridge and opening the eastbound span of the nearly completed new Goethals Bridge. The agency also took major steps forward in the Port Authority Bus Terminal redevelopment, including the identification of a new “build in place” alternative that attracted widespread support and interest. Intense consultations with stakeholders on both sides of the river accelerated the study of rail alternatives to expand trans-Hudson capacity for commuters. PATH made significant progress toward completing installation of Positive Train Control technology (PTC) while demonstrating customer service commitment and flexibility in handling passenger overflow from regional rail networks. Work also continued on the new PATH Harrison Station in New Jersey. Going forward, the Port Authority intends to approach its tasks within a basic framework that values integrity, diversity, global best practices, 21st-century technology, and speed of execution. Within this framework, the agency is committed to assessing its safety and security at all its facilities, delivering capital projects embodied in our Capital Plan, operating all our facilities at the highest standards of excellence, improving dramatically the customer experience at Port Authority facilities, and maximizing the environmental sustainability of our operations. We look forward to building on the agency’s 2017 accomplishments and working with you to address the critically needed improvement of the region’s transportation infrastructure in 2018. Sincerely, Kevin J. O’Toole Richard Cotton Chairman Executive Director BreaKING NEW GrounD 3 CHAIRMAN VICE CHAIRMAN RICHard H. BaGGer LeecIA EVE DANIEL J. HorWITZ Gary LaBarBera KEVIN J. O’TooLE Jeffrey H. LyNford Executive Vice President, Vice President Partner President Managing Partner President and CEO Corporate Affairs and State Government Affairs McLaughlin & Stern, LLP Building and O’Toole Scrivo Fernandez Educational Housing Market Access New York, New Jersey Construction Trades Weiner Van Lieu, LLC Services, Inc. Celgene Corporation and Connecticut Verizon Council Greater New York KEVIN P. MCCABE GeorGE T. MCDONALD RaymoND M. PocINO ROSSANA ROSado DAVID S. SteINer President Founder and President Vice President Secretary of State Chairman Carpenter Contractor The Doe Fund, Inc. Laborers International State of New York Steiner Equities Group, LLC Trust Union of North America Eastern Regional Manager BOARD OF COmmISSIONERS Kevin J. O’Toole, Chairman Jeffrey H. Lynford, Vice Chairman Richard H. Bagger Leecia Eve Daniel J. Horwitz Gary LaBarbera Kevin P. McCabe George T. McDonald Raymond M. Pocino Rossana Rosado David S. Steiner The following also served on the Board of Commissioners during 2017: John J. Degnan Michael D. Fascitelli Hamilton “Tony” E. James George R. Laufenberg Kenneth Lipper William “Pat” Schuber Caren Z. Turner As of April 20, 2018 4 THE PORT AUTHORITY OF NY & NJ LEADERSHIP OF THE PORT AUTHORIty The Governor of each state appoints six members to the agency’s Board of Commissioners for overlapping six-year terms; each appointment is subject to EXECUTIVE DIREctOR RICHard CottoN the approval of the respective State Senate. Commissioners serve as public officials of their respective states, and without remuneration. The Governors retain the right to veto the actions of Commissioners from their respective states. An Executive Director elected by the Board is responsible for managing the operation of the Port Authority in a manner consistent with the agency’s policies, as established by the Board. The agency undertakes projects and activities in accordance with the Port Compact of 1921, and amendatory and supplemental bi-state legislation. One of the four PAPD officers who responded to the Port Authority Bus Terminal bombing receives commendation from the Board. BreaKING NEW GrounD 5 OFFICERS AND EXECUTIVE MANAGEMENT Board of Commissioners EXECUTIVE DIRECTOR* Deputy Executive Director* Secretary* Chief Engineer Intergovernmental Inspector General Affairs OFFICE OF
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