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Improving Capital Projects in NYC Parks

Tuesday, November 26, 2013

Long-awaited construction of a promenade & warf along the Queensbridge Park seawall began last May.

Rents in New York City may be too damn high, but according to many park advocates and elected officials, the Parks Department's process for building capital projects is too damn slow.
 
Last week’s New York City Council oversight hearing on capital projects provided a timely opportunity to discuss some of the reasons the process is so inefficient, and possible ways of improving it.
 
Council Members often complain about creeping timelines and escalating costs for completing capital projects in city parks.  In response, NY4P is currently undertaking an in-depth study of the capital project process – from preliminary cost estimation through design and construction – for a number of City agencies (including Parks) to identify best practices as well as pitfalls and constraints. Our goal is to make recommendations for improving the Parks Department’s – and perhaps other agencies’ – capital project process.
 
Though this report won’t be completed until early 2014, at last week's hearing, NY4P Executive Director Holly Leicht highlighted what we believe is the single biggest impediment to efficiency in Parks Department capital projects: the fact that most parks projects that cost $3 million or less - which is the majority of the department's projects - are funded through capital allocations from Council Members and Borough Presidents, rather than with Mayoral funding. Mayor Bloomberg has provided generously to large park projects, but most smaller projects – like a playground renovation or a new dog run – are funded by the local Council Member or Borough President, with their annual discretionary capital funds.  As one government veteran described it to us, “The capital budget dance between the Administration and the Council occurs almost entirely around parks, libraries and cultural institutions. And all three pay a price.”
 
One way to avoid this dance would be for Mayor-elect de Blasio to reinstate a robust discretionary capital budget for the Parks Department, as NY4P calls for in our Parks Platform 2013. The Bloomberg Administration has invested heavily in parks, but those funds have primarily been allocated to the Parks Department for specific projects. Without increasing the department’s overall capital budget, the next administration could allocate the same amount of capital funds annually to Parks but make the funding more flexible so that department staff with first-hand knowledge about parks in all five boroughs can plan their pipeline of projects based on greatest need and target their budget accordingly.  We believe giving the Parks Department a discretionary capital budget would go a long way toward addressing disparate conditions among parks citywide.
 
But why is the current approach to funding most park capital projects so problematic? First, relying on Council Members and Borough Presidents for park funding politicizes the process. Staff from Parks’ borough offices have to negotiate with community boards and elected officials to get needed projects on their priority lists and to convince them to provide funding for projects that may not always align with their interests. Should a playground not be renovated because it happens to fall in the district of a Council Member for whom parks aren’t a top priority, or who has a slew of other important competing demands? A former Council Member who represented the Upper East Side told us that he could allocate funds to upgrade the parks in his district every couple years because he didn’t represent a high-need area. But his colleagues in the South Bronx and Brownsville didn’t have that option, because every dollar of their discretionary budgets was in demand just to augment basic services.
 
Even if a project has a Council sponsor, however, the process is fraught. Because Council Members’ annual discretionary budgets are relatively small, they understandably want to spread funding among multiple deserving projects, so it generally takes several budget cycles before all the funding for a single park project is allocated. So, if a project is estimated to cost $2 million, a Council Member may allocate $500,000 toward it over the course of four years. But that project cannot even begin design until all the funds to complete it are in place – so right there, you’ve lost four years. And by the time you do start design four years hence, chances are good the cost of the project has increased, necessitating a quest for additional funds.
 
What’s more, because every single project is individually funded, each project has its own funding line and requires its own review by the Office of Management and Budget (OMB), the Mayor's Office of Contracts, the Public Design Commission, and multiple other agencies, depending on the project. By comparison, consider how the Department of Environmental Protection’s (DEP) projects are funded. DEP submits a Certificate to Proceed to OMB for a multi-million dollar contract for, say, sewer work in Queens. The money for that work comes from the Mayor’s budget and is typically approved in one fell swoop by OMB. DEP can then draw down on that full amount as needed, without significant additional review for each individual project within the approved contract amount. This saves a tremendous amount of time, not to mention inter-agency headaches.
 
The current mechanism for funding park projects is certainly not the only area for improvement in the capital process, but we highlighted it at this hearing because it’s an area that the City Council can directly influence. NY4P hopes to work with the Council and the new administration to explore ways to alleviate some of the administrative hurdles inherent in the current capital process.
 
Changing the way anything is done in government – particularly when it involves money – is not easy, but there is widespread consensus that placing the responsibility for funding entire capital projects on Council Members and Borough Presidents is not producing cost-effective or timely capital projects.
 
With a new administration poised to take office for the first time in 12 years, now is the time to find innovative ways to reform that system - ideally starting with giving the Parks Department its own, flexible capital budget that can be targeted toward those parks most in need. 


Read more about the pitfalls of the current capital funding structure in this New York Times story from last June.



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