RIOC Management Speaks With Roosevelt Island Riverwalk Residents On Tram Shutdown Transportation Changes And RIRA On 2010-2011 Budget

Roosevelt Island Operating Corporation (RIOC) President Steve Shane, Chief Financial Officer Steve Chironis and VP Of Operations Fernando Martinez were all busy last night making presentations to members of the Roosevelt Island community.

The first up was Mr. Martinez. He was invited by Related Management to speak on the transportation changes planned for Roosevelt Island following the temporary shutdown of the Tram during it's Modernization Program. Mr. Martinez spoke before a gathering of Southtown's Riverwalk residents in the rooftop Party Room of Riverwalk Crossings, the new rental building adjacent to the Tram, at 405 Main Street.

RIOC's VP Of Operations Fernando Martinez Speaking To Riverwalk Residents

Mr. Martinez explained that the Tram shutdown is scheduled to begin on March 1, last for six months and resume operations in early September. There is a possibility that one of the cabins may be in operation a little earlier, middle of August, but that is not definite. During the tram shutdown, RIOC will be providing Red Bus Shuttle rush hour service to the Queens Plaza subway station every half hour with pick ups at Southtown and Gristedes stops. During non-rush hour week days and weekends, there will be Red Bus Shuttle service to Second Avenue in Manhattan. Here is more information on RIOC's plan for Red Bus shuttle service from earlier post.

Mr. Martinez also talked about the results of the survey seeking residents interest in a temporary rush hour ferry service during the Tram Outage. The survey results were still being tabulated but of the approximately 1000 responses received, about 50% were in favor of the service and of those 50%, 30% (150) said they would pay the projected fare of $3 and find the route useful for their commute. The projected cost of the temporary ferry service is said by the Operator to be $5,000 per day. Do the math - even with a proposed $100,000 subsidy from RIOC - the economics don't seem to work unless RIOC (or some other entity) is willing to subsidize the service to a much larger dollar amount.

Residents attending the meeting asked questions about increased F Train subway service during the tram outage and Mr. Martinez explained that RIOC has been meeting with the MTA but that no additional subway service is to be expected. More detail on the MTA's response to Roosevelt Island residents request for increased subway service is available from this earlier post. One new Roosevelt Island resident recounted a conversation she had with an MTA official about the problems she would encounter getting to her doctor with the Tram Outage. She was told by the MTA official that she should have done more research about Roosevelt Island before moving here.

RIOC's Fernando Martinez Answering Residents Questions On Tram Shutdown

Other residents were concerned about the qualifications of POMA, the Tram Modernization contractor and whether all of the necessary construction and traffic permitting would be in place prior to the Tram going out of service. Mr. Martinez assured them that POMA was qualified and that all permits would be in place before the Tram was taken out of service.

Another resident wanted to know what the tram outage would do to the assesed value of his condominium. The Related representative said she was not an appraiser and could not comment on this issue.`

I think all agreed that Mr. Martinez made an excellent presentation. I asked if he has made similar presentations to other Roosevelt Island buildings and he reported that he has met with representatives from all of the Roosevelt Island buildings management but that Related was the only management company to ask him to speak to their residents.

Later in the evening, Mr. Shane and Mr. Chironis appeared before the Roosevelt Island Residents Association (RIRA) Common Council to report on and take questions concerning RIOC's proposed budget for Fiscal Year 2010 -2011.

RIOC President Steve Shane Speaking To RIRA On Budget

Mr. Shane explained that RIOC is legally required to prepare a 5 year budget but that at the suggestion of RIRA has extended the forecast to 15 years and noted that such projections are subject to uncertainty, more so the further out in years one attempts to project. "Stuff happens" Mr. Shane said, which can change the assumptions upon which the budget is based.

According to Mr. Shane, RIOC has an annual operating budget of $18-19 million with revenue coming from residential fees, ground rent, commercial retail rent, tramway, parking and other sources. No operating funds come from the City or State of New York. (See Page 5 of Budget for RIOC's revenue and expense projections). Mr. Chironis noted that to date, the recession has not adversely impacted RIOC's budget.

RIOC CFO Steve Chironis Speaking to RIRA on Budget

Where the recession could hurt RIOC is in the capital budget because so much of that budget is based upon revenue coming from Hudson/Related completing Southtown with the construction of Riverwalk Buildings 7-9. If that does not happen then there could be big trouble for RIOC capital projects.

Regarding Southtown Buildings 7 - 9, RIOC's proposed FY 2010-11 budget states (Page 9) reports:

Southtown 7, 8, and 9:
In 2006, the Southtown developers exersized an option at a cost of $2,000,000 to extend the Construction Commencement Date for all buildings of Southtown 5–9 from no later than December 31, 2010 to December 31, 2012. Management believes that given current market conditions there is a possibility that the development of Southtown 7, 8, and 9 may not happen, negatively affecting projected cash reserves. Below is the effect on projected cash reserves, if the development of Southtown 7, 8, and 9 were not to go forward. It is management's belief that if Southtown 7, 8, and 9 were to not proceed in the time period, there would be other subsequent development opportunities after the economic downturn cycle reverses its course.

Both Mr. Shane and Mr. Chironis did equally as well as Mr. Martinez in their presentatins.

Here is more information on RIOC Budget from earlier post. The Roosevelt Island Residents Association Town Hall Meeting scheduled for 8 PM on February 10 at the Good Shepherd Community Center will focus on RIOC's Budget as will RIOC's Town Hall meeting immediately following the February 18 RIOC Board of Directors meeting, also at the Good Shepherd Community Center. The RIOC Board will vote on the budget at their March meeting.

We also learned from RIOC's presentation that, to date, there have been 64 condo units sold and 13 units in contract for the new 122 unit Hudson/Related Riverwalk Court building at 415 Main street as well as half of the units rented an the adjacent Riverwalk Crossings.