RIPTA moves ahead with bus hub privatization plan, ignoring its duty to riders

"...it is financially irresponsible to undertake an expensive move to a new bus hub in a worse location than the current one," say RI Transit Riders.

The Rhode Island Public Transit Authority (RIPTA) Board of Directors issued a celebratory email¹ today after unanimously approving a contract with Next Wave Rhode Island Partners for Phase 1 of a public-private partnership (P3) to design and construct a new transit center in Providence. (You can read the email at the footnote.)

Asked after the meeting why a new transit center, not to be located in Kennedy Plaza is necessary, RIPTA CEO Scott Avedisian told reporters that riders asked for amenities that only a new transit center could provide. But this is disingenuous at best, given that there has been virtually no support from riders for moving the bus hub out of Kennedy Plaza.

“RI Transit Riders strongly opposes the proposed contract on the RIPTA Board's January 30 agenda to spend $16.9 million on initial design for a project built around a completely unnecessary new bus hub,” wrote the group in a statement issued before the vote was taken. “When RIPTA is facing imminent service cuts, unable to pay enough to attract bus drivers, and expecting an even worse fiscal cliff in the next two years, it is financially irresponsible to undertake an expensive move to a new bus hub in a worse location than the current one.” They continue:

“The proposed Preliminary Services Agreement, at $16.9 million, will use almost all the remaining bond money that was approved in 2014 by voters, who had been told it would be used to fund ‘enhancements and renovations to mass transit hub infrastructure throughout the state...’ We don't believe this project meets those standards as promised to voters. The proposal doesn't enhance RIPTA's infrastructure any more than it renovates Kennedy Plaza. These funds could instead be used as promised to improve mass transit; we can't afford to squander the money.”

You can read the full RI Transit Riders statement here.²

Riders are not the only ones who oppose this plan. Grow Smart RI writes:

“…we cannot support ANY action to advance the development of a new transit hub at this time for several reasons. These include the chronic underfunding of transit service that's been well-documented for over 20 years, the severe service cuts that are now projected, and the continued lack of urgency to address the funding and driver shortage crisis as well as the implementation of the State's adopted Transit Master Plan, we had little choice but to stand by riders.”

You can read Grow Smart RI’s full statement here.³

From the beginning of this process, the state has been focused on on public-private partnership model [aka PPP or P3] for building a new bus hub. In 2022, Greg Nardine, Chief of Strategic Advancement at RIPTA, explained that “in entering a P3 we’re going to bring on a private developer who is going to work with us to make sure they are delivering a transit center to the standards we specify, but also giving them the opportunity to be the landlord and do those things because they’re better suited to do that.”

I pushed back, noting at the time that there was no way any private developer would agree to the terms RIPTA was then imposing on a P3 developer, only to be met with pushback by Nardine who strongly implied I had no idea what I was talking about. Since then, no developer has stepped forward under RIPTA’s original P3 proposal and Nardine has left the agency.

“RIPTA’s contract with Next Wave Partners differs from a traditional construction bid,” said RIPTA CEO Scott Avedisian in a statement. “Using a progressive P3 model, RIPTA and Next Wave Partners will work together in two phases to complete the new transit center, a common model for larger infrastructure projects. RIPTA will be designing and developing the transit center alongside Next Wave and opening each stage of the process to public input.”

This is also a disingenuous statement. Every P3 is different. Each contract is worked out between the state agency and the private developer. Their are similarities between contracts, but there is no standard P3 model. To say that this particular P3 is in some way new or “progressive” is trite and deceptive.

P3’s are privatization - pure and simple, and perhaps worse than pure privatization because it allows companies to offload risk onto the public while reserving profits for themselves. Mandeep Tiwana, head of policy and research at CIVICUS⁴, writes that, “public-private partnerships are becoming a pathway – supported by international financial institutions and large corporations – to entrench neo-liberal economic orthodoxy, causing the state to withdraw from its basic responsibilities.”

Tiwana goes on to say that “big businesses are increasingly eyeing the public sector as an avenue for profit making. And governments are only too willing to outsource basic responsibilities to the private sector, increasing the gap between those who are able to pay for monetized access to public services and those who cannot.”

Privatization advocates deny this, of course.

P3’s are, “in a way, in between two extremes,” said John Smolen partner at the law firm Nossaman LLP on behalf of the National Council for Public-Private Partnerships (NCPPP), of which he is also a board member in 2016. “On one extreme is a traditional, government procurement… on the other side of the spectrum there is a privatization, which is taking a public good, and essentially selling to the public sector and removing your responsibility for it.

“A public-private partnership,” continues Smolen, “is neither of those things.

“…if there’s a political point to make, and it’s often confused, public-private partnerships isn’t a fancy long word for privatization. It simply is not. Privatization is a completely different legal undertaking…”

I spoke to Donald Cohen, Executive Director of In the Public Interest (ITPI) a national nonprofit research and policy organization that studies public goods and services. His “History of Privatization” series on the website Talking Points Memos (TPM) is a must read. I asked him why proponents of P3’s insist that they are not privatizing public goods and services.

“It’s a common theme,” said Cohen. “The reason they say it’s not privatization is because they’re claiming the P3 is just a long term lease. The public retains ownership, even though some of these contracts are 75 years long. I don’t think I’ve seen anything less than 50 years in the United States. But the thing that in my mind that makes it privatization is that we, the public, are giving private firms control of an asset that the public should have control over.

“The other point being is that because the contracts are very rigid and they’re hard to do, contracts have to anticipate everything that could happen in the future. I mean, who would’ve thought we’d be in nearly the third year of a pandemic or that climate change would be moving quicker than anticipated? The rigidity of these long term contracts hurts the ability of the public to respond to changing conditions.”

You can read my full interview with Cohen here, and you can access my pieces about a 2016 P3 Commission here:

• Public goods and spaces at risk as State House leaders seek to expand public-private partnerships

• Skanska’s public-private partnership sales pitch at the State House

• P3 advocates seek a playing field advantage before negotiations begin

• Is the Public-Private Partnerships Commission asking the right questions?

“In 2017 the City of Providence had a robust public process that resulted in a broad consensus on how to reduce the footprint of the bus hub while keeping it in Kennedy Plaza, making the Plaza a better public space,” writes Rhode Island Transit Riders. “That plan was derailed by adjacent real estate owners who saw the state's central bus hub, with its riders who are often low-income or people of color, as a detriment to their property values. They wanted to have the hub moved away somewhere at public expense, showing no concern for what the bus system needs. Since then, we have seen various badly-thought-out plans for relocating the hub which never takes riders' needs seriously. And this contract is designed so that the optimum Kennedy Plaza location would not even be considered. It's no way to spend public money, and it seems to violate civil rights."

RI Transit Riders has it exactly right. Despite the words of RIPTA’s CEO and boardmembers, few if any of whom actually use public transportation, the bus hub is being moved to serve powerful moneyed interests, not riders.

1. Here’s the email from RIPTA:

“The Rhode Island Public Transit Authority (RIPTA) Board of Directors voted today to approve a contract with Next Wave Rhode Island Partners for Phase 1 of a public-private partnership (P3) to design and construct a new transit center in Providence.

“Next Wave Partners is a consortium comprised of several Rhode Island-based companies including Gilbane Development Company, Marsella Development, and Gilbane Building Company, as well as Plenary Americas, CUBE 3, and Jacobs. Successful community-based projects from these subsidiaries include 100 Westminster Street, Union Station, the Providence Performing Arts Center, and the Nightingale Apartments in downtown Providence.

“Bringing our transit system into the 21st century will attract more riders, reduce cars and emissions on our roadways, and create more opportunities for mixed-use development,” said Governor Daniel McKee. “By using a public-private-partnership [P3] model, we will develop a transit center with riders and maximize the expertise of Next Wave Partners.”

“Thank you to Governor McKee and RIPTA’s Board of Directors for their support of public transportation and vision to improve the ridership experience while also creating economic development opportunities,” said Scott Avedisian, RIPTA CEO. “A new transit center is a major step in strengthening our transit system and laying the groundwork to expand ridership, maximize investment from the private sector, and create a financially viable model.”

“We are looking forward to working with Next Wave Partners, who share our vision for bringing state-of-the-art amenities to Providence and have extensive experience here in Rhode Island and across the country,” added Avedisian. “We look forward to engaging the community in the design and planning process.”

“RIPTA’s contract with Next Wave Partners differs from a traditional construction bid. Using a progressive P3 model, RIPTA and Next Wave Partners will work together in two phases to complete the new transit center, a common model for larger infrastructure projects. RIPTA will be designing and developing the transit center alongside Next Wave and opening each stage of the process to public input. This approach will ensure RIPTA has input at all stages of development and can access the private-sector funding and expertise needed to deliver a project of this scale successfully.

“‘This new transit hub promises to deliver modern facilities for riders and drivers,’ said Mayor Brett Smiley. ‘I am looking forward to collaborating with RIPTA to ensure that this new transit hub fully meets the modern transportation needs of the many residents, workers, students, and visitors that use our bus hub every day.’

“In the first phase, RIPTA and Next Wave Partners will complete site studies and assessments, engage with the public, seek permitting and any third-party approvals, and develop 30% and 60% conceptual designs. Following input and development of designs, Next Wave will develop cost estimates for the project, as well as financial structuring and advising. Upon successful completion of the first phase of the project, the parties would negotiate a contract for a second phase of the contract for financing and constructing the project. We estimate Phase 1 to occur over the next year and a half.

“‘Along with our development partners, Marsella Development and Plenary Americas, we are thrilled to get this progressive P3 underway with RIPTA to deliver a state-of-the-art transit center that will enhance mobility, connectivity, and accessibility for the riders, residents, and visitors of Providence,’ said Russell Broderick, executive vice president of Gilbane Development Company and principal-in-charge of the Next Wave Rhode Island Partners consortium. ‘This project highlights the P3’s ability to facilitate a comprehensive process to advance essential community infrastructure projects that meet the needs and expectations of the public sector partner, the facility users, and the broader community. We look forward to collaborating with project stakeholders through a robust public process in the months ahead to bring this vision to life.’

“The new transit center will serve as RIPTA’s central bus depot, providing millions of trips annually, and considering anticipated growth, the transit center will feature a state-of-the-art temperature-controlled passenger arrival and seating area, staff break areas, and amenities including multi-modal accommodations for bicyclists.

“RIPTA and Next Wave will also explore mixed-use transit-oriented development, such as first-floor retail and residential housing on the upper floors, offering economic development opportunities for the city. In contrast to the current sprawling footprint of Kennedy Plaza, which is spread out across an urban park, the new transit center will provide a single central location. Kennedy Plaza will continue to serve a reduced number of routes.

“‘This is a great first step forward toward constructing a transit hub that can greatly enhance the transit experience in greater Providence,’ said RIDOT Director Peter Alviti, RIPTA Board Chairman. ‘The hub will allow services to expand and serve new markets and will provide a safe and efficient center for operations. The partnership with Next Wave also opens the possibility of other amenities as part of the hub including retail spaces. I want to thank the RIPTA board for the hard work they have done and continue to do to transform RIPTA.’

“RIPTA has been engaged in numerous, lengthy discussions for over a year with state, local, and community leaders about building a new, multistory, mixed-use transit center in Providence. The proposal has garnered broad-based public support. The project, in part, is supported by a bond referendum to improve RIPTA’s transit services via a new transit center in the downtown area. On January 17, 2023, Governor Daniel McKee announced the opening of the Request for Proposals period. Submissions were due on April 17, 2023. RIPTA’s Board authorized the Agency to engage in contract negotiations with Next Wave Partners on August 26, 2023. The contract, approved by the Board on January 25, 2024, is for the Preliminary Services phase of the project (Phase 1). The contract includes a milestone schedule for performance and compensation for the vendor to ensure all aspects are delivered upon.

“In the coming months, RIPTA and Next Wave Partners will launch a robust public comment period to gather stakeholder input for designs for the new transit center.” 

2. The full statement from Rhode Island Transit Riders:

“RI Transit Riders strongly opposes the proposed contract on the RIPTA Board's January 30 agenda to spend $16.9 million on initial design for a project built around a completely unnecessary new bus hub. When RIPTA is facing imminent service cuts, unable to pay enough to attract bus drivers, and expecting an even worse fiscal cliff in the next two years, it is financially irresponsible to undertake an expensive move to a new bus hub in a worse location than the current one.

“The proposed Preliminary Services Agreement, at $16.9 million, will use almost all the remaining bond money that was approved in 2014 by voters, who had been told it would be used to fund "enhancements and renovations to mass transit hub infrastructure throughout the state..." We don't believe this project meets those standards as promised to voters. The proposal doesn't enhance RIPTA's infrastructure any more than it renovates Kennedy Plaza. These funds could instead be used as promised to improve mass transit; we can't afford to squander the money.

“Although Kennedy Plaza has problems, they could be solved for far less cost than building a new hub. Providing enhanced security, better lighting, landscaping, traffic signalization and signage, and revitalizing the terminal building would be a relatively cheap improvement, much better than the current hub-relocation proposal.

“In 2017 the City of Providence had a robust public process that resulted in a broad consensus on how to reduce the footprint of the bus hub while keeping it in Kennedy Plaza, making the Plaza a better public space. That plan was derailed by adjacent real estate owners who saw the state's central bus hub, with its riders who are often low-income or people of color, as a detriment to their property values. They wanted to have the hub moved away somewhere at public expense, showing no concern for what the bus system needs. Since then, we have seen various badly-thought-out plans for relocating the hub which never takes riders' needs seriously. And this contract is designed so that the optimum Kennedy Plaza location would not even be considered. It's no way to spend public money, and it seems to violate civil rights.

“The proposed Agreement does not name a site for the hub, but state leaders have been pointing to a remote location on I-195 land near Clifford St. Almost no bus riders have their destinations near that site, and it's bad for bus routing too. No key routes, such as the Downtown Transit Corridor and R-Line, go by this site. Rerouting them will significantly slow trips and increase RIPTA's costs.

“When Governor McKee recently mentioned how bad it would be to put the hub out ‘in Siberia,’ he was, in a way, voicing what is wrong with the I-195 site he's supported.

“The damage to taxpayers goes even further: this costly $16.9 million design contract covers only a small fraction of what relocating the hub would cost overall, as has long been acknowledged. Should we spend more and more just to create an unwanted ‘Siberian’ hub?

“It should be an unacceptable procedure to make such a major decision as moving the Kennedy Plaza hub, which has huge financial and operational implications, without consulting the public and those who use the bus.

“A good transit system not only enables people to travel but also helps address pollution, congestion, climate emissions, road safety, and housing needs, as well as keeping more of our energy dollars within the state's economy. A safe, well-sited central bus hub, which Kennedy Plaza is, can help RIPTA live up to its potential to do all that. Surely we should not spend a lot of money to move the hub to an inconvenient location that could cripple an already struggling system for the foreseeable future.”

3. Grow Smart RI’s full statement:

“Grow Smart RI has been a leading champion for the development of a modern, full-service, indoor transit hub in Downtown Providence. We believe that such a facility is important to growing transit ridership and that patrons deserve the dignity of climate-controlled shelter with basic amenities similar to those available at rail stations and airports.

“However, we cannot support ANY action to advance the development of a new transit hub at this time for several reasons. These include the chronic underfunding of transit service that's been well-documented for over 20 years, the severe service cuts that are now projected, and the continued lack of urgency to address the funding and driver shortage crisis as well as the implementation of the State's adopted Transit Master Plan, we had little choice but to stand by riders.

“Riders place a much higher value on the importance of increased service frequency and hours of operation than on a new transit hub facility. The interest of riders should come first for State leaders.

“There is no evidence that the RIPTA Board requested sufficient funding to maintain and grow service levels. In March 2023, there was insufficient support on the Board to approve a DRAFT RESOLUTION requesting the attention of the Governor and General Assembly Leadership to fully fund RIPTA.

“And the Governor's Budget Proposal continues to leave an $8 million deficit just to maintain existing service levels and no funds to begin the already delayed implementation of the Transit Master Plan.

“For all these reasons, Grow Smart cannot support proceeding with a new transit hub project while the Board and state leaders ignore the calamity and disruption that will be experienced by thousands of residents and employers affected by pending service cuts.

“Summary of comments at 1/25 RIPTA Board meeting about chronic underfunding of transit, projected service cuts, and proceeding with joint development agreement to build a new transit hub in Providence.”

4. The mission of Civicus is “To strengthen citizen action and civil society throughout the world.”