Pagoda Palace: Don't Expect That Money Back

Categories: Politics
Boring pic Fukuman.jpg
Audrey Fukuman
Huh. Keep your receipts!
C.W. Nevius' piece today on the long and colorful history of the Pagoda Palace was a lot of fun to read, if only for mention of a 1960s theater troupe called "The Cockettes."

The vaudeville theater turned urban blight turned proposed extraction site for Central Subway tunnel-boring machines was the subject of an SF Weekly news analysis. And Nevius' blithe piece was a bit too blithe about the $9.15 million price tag for the Pagoda Palace extraction -- costs that, unlike the federal funds bankrolling most of the Central Subway project, will be locally borne.

Reads the piece: "It will increase the cost by some $9 million, but the city's Municipal Transportation Agency plans to pay that out of reserve funds and is confident it can replenish those funds, either with additional federal money or increased local revenue."

It's nice to know that Muni is "confident" it can account for the funds it's committing to; next time you step on the bus, be sure to tell the driver you're "confident" you can pay your fare. But Nevius' wording brushes past two disturbing scenarios:

See Also: Boring Stories -- Muni's cunning plan to tunnel 2,000 feet into a theater

The first is simply that revenue Muni would otherwise use for operating the system -- that is, making the vehicles go, fixing its woefully maintained fleet and infrastructure, etc. -- will be siphoned away.

The second is the reassurance of being compensated by the feds. But this is a remote possibility.

The feds are already showering some $942 million on the $1.6 billion project, and have approved tunneling as far as Columbus Avenue in this phase of funding. As noted in our article, digging that far -- 2,000 feet beyond the last funded stop in Chinatown -- was blessed by the feds under the rubric of "construction purposes" for the current phase of the project.

Muni aims to spend upward of $70 million to tunnel into North Beach with the ostensible "construction purposes" being the salvage of $4.4 million worth of tunnel-boring machines.

Rather than unearth the machines in the middle of one of the busiest and most vibrant streets in North Beach, the current plan calls for doing so from the derelict Pagoda Palace. This, however, is an extension from the spot the feds agreed to fund a tunnel up to, hence the $9.15 million in local funds.

So, in order to get money reimbursed, it would require federal authorities overlooking their footing the bill for a very expensive tunnel for the ostensible "construction" purpose of removing those essentially disposable machines. But it would also require the Central Subway project to come in on budget and not have exhausted its contingency funds. As noted in our story, a recent analysis by an outside consultant pegged the chances of coming in on budget at 30 percent. The chances of exceeding the project budget by hundreds of millions of dollars -- money local sources would be made to disgorge -- was disturbingly higher. A great deal more local money may be following this $9.15 million.

Regardless of what one thinks of the Central Subway project, the situation on the ground -- literally -- required city decision-makers to pivot and find a way to prevent the mess of holding a major construction dig in the middle of Columbus. And they did this.

As noted in this week's paper, from a big-picture perspective, one could make the argument that it's worth it to spend the feds' money to dig a tunnel to North Beach. But to claim this is all about the most expedient way to unearth those boring machines is a stretch.

So is expecting this money to be painlessly "replenished."


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