Payout Cap Could Cause LIRR Repair Delays

The fallout from superstorm Sandy continues to rear its ugly head in the tri-state area in terms of our transit infrastructure. One of those key pieces is the Amtrak owned East River Tunnels that the LIRR uses to & from Penn Station.

Last year the much maligned Amtrak proposed plans to fix 2 of the 4 East River Tunnels at the cost of hundreds of millions of dollars. However a recent ruling from the U.S. District Court in a lawsuit between the agency and multiple insurance companies capped the payout at $125M, far short of the amount needed for project completion.

Newsday Transit Reporter Alfonso A. Castillo of Newsday has more:

A federal court ruling capping how much insurance companies will have to pay out for superstorm Sandy damage to the East River tunnels primarily used by the LIRR could cause big delays to planned repairs as the tunnels’ owner, Amtrak, scrambles to find money for the fixes, officials said.

The project, proposed last year by Amtrak, would rehabilitate two of the four rail tunnels running between Queens and Penn Station — a massive undertaking that would require removing each of the two tunnels from service for a year at a time and cost “several hundred million dollars,” according to the agency.

However, a recent U.S. District Court ruling in a lawsuit between Amtrak and several insurance companies limited the insurance payout to Amtrak for the tunnel damage to just $125 million. That’s enough to move forward with ongoing work to design the project, but not nearly enough for its construction, which Amtrak hopes to begin in two to three years.

The tunnels were inundated with 14 million gallons of floodwaters during the October 2012 storm, and Amtrak officials said corrosive salts and chlorides left behind have continued to deteriorate the underground structures.

U.S. District Judge Jed Rakoff sided with insurance providers in ruling that the tunnel damage falls within a $125 million limit for flood damage. Amtrak, in a $1.1 billion suit filed earlier this year, argued that the damage was caused by wind-driven storm surges, which are different from flood, and that the water and salt damage were separate.

Click here for the complete report.

I do not find it surprising whatsoever that our court system has failed to do what is right as that trend has been going strong for quite sometime. The real victims of this are the LIRR riders who already pay for overpriced service & now face the potential of critical repairs not being completed. If by any remote chance, the MTA has to help procure the difference, we can all but guarantee that the costs will somehow trickle down to commuters.

Hopefully this decision can be overturned so that Amtrak could actually get something useful done for a change. I’m not holding my breath though…..

xoxo Transit Blogger

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[…] a followup to the story of the U.S. District Court’s decision to cap the payout at $125M for Amtrak for superstorm Sandy damage, Senator Chuck Schumer is seeking $550M in unused superstorm […]

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