Sunday, December 28, 2014

Cuomo, Christie Embrace Massive Port Reform

New Jersey Governor Chris Christie and New York Governor Andrew Cuomo have accepted the comprehensive and wholesale changes recommended by the Bi-State Special Panel on the Future of the Port Authority.

At its core these changes call for restructuring the agency’s overall operations, including reorganizing the leadership of the Board of Commissioners and the executive management of the Port Authority with the creation of a single Chief Executive Officer and the modification of the Chairperson’s role.  The reorganization accepted by the Governors will also return the Port Authority fully to its original mission – developing and maintaining the world’s largest transportation system and infrastructure.

The structural reorganization of the Authority will create clear lines of responsibility and accountability that start with its leadership.  A single Chief Executive Officer -- to be hired as expedi tiously as possible based on a national search directed by the Board of Commissioners -- will replace the Executive Director and Deputy Executive Director.  The current Chair and Vice-Chair roles will be modified in one of two ways. Either the Chair and the Vice Chair positions will be replaced with two Co-Chairs, one recommended by each Governor, for election by the Board of Commissioners, or the chairmanship will be rotated between the two states on an annual basis.

Either approach promotes a long-term balance between the policy interests of the respective states, and present a more equitable model to the public stakeholders of the Authority. The CEO and either Co-Chairs or rotating Chair and Vice-Chair will constitute the Office of the Chair, a senior operations committee.

Organizational changes to the Agency to demand increased accountability is only part of the Special Panel’s recommendations to maintain trust with the public it serves.  Governors Christie and Cuomo are embracing initiatives to increase transparency of the Port Authority’s deliberations and operations.

Additionally, Governors Cuomo and Christie accept and endorse the transparency legislation, Senate Bill No. 2183 (First Reprint), and S6718C/A8785C, but with some sensible changes to eliminate confusion that would be caused by the bill as currently drafted. The recommended changes will make it easier for individuals pursuing public records under the law. The Governors continue to embrace the previously announced Freedom of Information policy, which ensures access to the Port Authority’s records under both States’ laws, and the recent practice of strictly limiting the use of executive sessions for Board deliberations and using public meetings whenever possible.  Additionally, the Port Authority has been instructed to prepare a revised Code of Conduct to drive a renewed focus on ethics and compliance throughout the agency, and the Governors are calling for the creation of a Chief Ethics and Compliance Officer position to ensure the highest ethical conduct.

“These changes reflect the need for a profound and necessary reimagining of the Port Authority governing structure, operations, and transparency in its oversight of the world’s largest transportation and commerce network,” said Governor Chris Christie. “Governor Cuomo and I have remained advocates for reform at the Port Authority and are encouraged by these recommendations from the bi-state panel.”

 “In May, Governor Christie and I ordered a broad review and evaluation of the Port Authority's structure, management, operations, and governance to find ways for the Port to better serve both states and improve as a global transportation and commerce hub," Governor Cuomo said. "The recommendations put forward by the bi-state panel include important reforms to address the Port's inefficient and outdated governing structure and will help bring new transparency and effectiveness to the agency as it approaches its tenth decade of service. I am pleased by the work and recommendations issued by the bi-state panel, and look forward to a new era for the Port Authority."

Comprehensive and Sweeping Changes To Be Enacted:

·         Governors Cuomo and Christie are requesting each and every Commissioner to tender an offer of resignation to be considered by their respective Governor
·         Creating a single Chief Executive Officer to replace the Executive Director and Deputy Executive Director
·         Modifying the Chairperson’s role with the creation of Co-Chairs or a rotating chairmanship between the two states on an annual basis
·         Creating a Chief Ethics and Compliance Officer
·         Reforming the Port Authority’s public-records and ethics guidelines, fully consistent with each state’s open public records laws
·         Adopting a new Mission Statement to refocus the authority on its original core mission of developing and overseeing regional transportation infrastructure
·         Reinstating the Port Authority’s regional leadership role by initiating a comprehensive planning effort in 2015 with a strategic vision focused on expanding and developing new regional transportation capacity
·         Investing in the region’s airports in a manner that ensures that these vital facilities are equipped to serve as the gateway to the region for travelers and goods from around the world 
·         Prudently divesting existing real estate holdings and restricting future real estate investments to those integral to the Authority’s core transportation mission
·         Pursuing the construction of a new Port Authority Bus Terminal to meet the increasing requirements of this vital element of the Trans-Hudson transportation network
·         Modernizing Port Commerce facilities to increase their efficiency and maximize the potential of the ports as the premier portal for cargo entering the United States
·         Seeking an improved operating model for the PATH rail system, including potentially partnering with a third-party operator, to enhance the PATH’s operational performance and reduce its financial deficit

As part of their actions today, Governors Christie and Cuomo are seeking to enact bi-state legislation consistent with the Special Panel’s Report.  To that end, the Governors are acting uniformly on the pending Port Authority legislation of both states.

Both Governors embrace the spirit and intent of the extensive reforms contained in the omnibus pending legislation, Senate Bill No. 2181 in New Jersey and A3944C/ S7721 in New York.  However, to more fully execute on reform in every area of Port Authority operations, management, and transparency, they are asking their respective Legislatures to review the extensive analysis and insights contained in the Special Panel’s report to guide the crafting of broader and more comprehensive reform legislation.  Therefore, while neither Governor is approving the legislation as passed, they are urging their respective Legislatures and the Port Authority to work with them to implement the broad reforms package recommended by the Special Panel, recommendations which will mark a new beginning and form a basis for meaningful reform for decades to follow.

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