Friday June 1, 2012

GLENVILLE, N.Y. (AP) -- The state has been paying more than $150,000 a year to store trains and replacement parts from a high-speed rail project that failed in 2004, the Cuomo administration said Thursday.

Now officials plan to sell the four remaining Turboliners, adding that they may not be worth more than scrap after the project cost New York $70 million. One five-car train sits in a field on the outskirts of suburban Schenectady, rusting and partly vandalized in an industrial park. Others stand nearby. An entire warehouse in another industrial park contains stacks of rusting wheels, turbine engines still shrink-wrapped and crated, and shelves of train parts.

The issue highlights ongoing problems with state government providing public money to private companies in exchange for a promise of jobs and prosperity, despite past scandals of politically connected companies doing little for their tax breaks. The Cuomo administration, calling attention to the rail project launched in 1998, is promising to do it differently.

"You spend the taxpayers' money like it's your own," said Howard Glaser, director of state operations. He said that's his guidance to state agencies and commissioners. "You need to manage your risks and pay attention."

"And none of those things were done when this project was initiated."

The $185 million project to refurbish Amtrak Turboliners to run 110 mph on New York tracks was part of Gov. George Pataki's plan to upgrade rail service and cut travel time between Albany and New York City.

Super Steel Schenectady hired workers and began to rebuild and modernize trains, which were originally built in 1976, at the industrial park in Glenville. Two were used for several months in 2003 by Amtrak, which also took delivery of a third train before it stopped using them, citing problems like poor air conditioning and the need for more track upgrades.

State Budget Director Robert Megna said that as a capital project it probably involved state bonds payable over about 20 years by New Yorkers, a project that failed to produce a long-term return. "We invested capital money. They never got to use that train. They're still paying it off," he said.

The trains and equipment will be turned over from the state Department of Transportation to the Office of General Services, which will have to evaluate them, the market and the best way to dispose of them, Glaser said. Meanwhile, the administration is trying to identify all the other unneeded items and leases, he said.

The Cuomo administration lists seven rail projects under way with $567 million of federal funding with $104 million from the state. They include building a second 17-mile track between Albany and Schenectady and building separate tracks for Amtrak between Harold Interlocking in Queens and Penn Station in Manhattan.