Guest Opinion: The Right Way to Use Eminent Domain to Fix the Penn Station Mess

At a June 7 City Planning Commission meeting, ASTM explained their toll idea and “capital stack” concept. | Screenshot via CPC’s YouTube channel

BY LYNN ELLSWORTH | The destruction of Penn Station in the 1960s came about through a cozy arrangement between two brothers, James and Irving Felt. One was a real estate developer and the head of City Planning, and the other was a financier. They replaced the station with Madison Square Garden, the ugly tower known as Two Penn Plaza, and the underground rat’s nest of a train station. It was not just an architectural crime, but a crime against the public good whose repercussions we still contend with.

Fast forward to the present and it is déjà vu all over again. MSG is now owned by real estate mogul James Dolan, whose deal with the city has allowed him to avoid nearly a billion in property taxes according to the Independent Budget Office. His neighbor, fellow mogul Steven Roth of Vornado, owner of Two Penn, has also played rough with the public good. Roth has reclad the Two Penn tower to resemble Hudson Yards, demolished the historic Hotel Pennsylvania, and deliberately blights the neighborhood to get the State to use eminent domain on his behalf. Although his project is temporarily on hold, it is not officially dead. The State is still pushing a plan to seize an entire block and give Roth the rights to erect 10 towers, most of them supertalls. Among the victims of the State’s plan are Capuchin monks of the Franciscan order, who took a vow of poverty and have served the poor out of their beautiful 19th century church since 1870.

The public transit agencies—MTA, Amtrak, and New Jersey Transit—have a big stake in this game, and have been silent about Two Penn and the mess Vornado is making. But they are not silent about the mess that is MSG. The agencies issued a joint report saying that MSG is “incompatible” with plans to fix Penn Station. It says what we all know—the Garden is in the way (as is Two Penn, but the agencies didn’t go that far). Moreover, advocates of through-running (a train system necessary to modernize Penn Station as a transit hub) point out that we need to take out hundreds of columns that support MSG because they limit track improvements needed for through-running. Instead of contending with these realities, our technocrats are bending over backwards to come up with work-arounds to please Dolan and Roth. That isn’t good. The policy of mogul-pleasing limits our ability to transform the busiest train station in the country into a 21st century transit hub.

To complicate matters, another, mogul, Arthur Gumowitz, owns big garment-era buildings in the area and doesn’t want Vornado to tear them down. To get his way, Gumowtiz has put into play lawyers and a platoon of lobbyists, some operating under the banner of “Trains Before Towers” who oppose Vornado but don’t have a clear stance on the Garden where there are new lucrative signage deals to be made with the Dolans. To add to the murk, unknown big donors have gotten behind Alexandros Washburn’s flush “Grand Penn Alliance” (registered by Big Real Estate lobbyist Ken Fisher) to promote rebuilding the old Penn Station. That is a popular idea with legit legs that was originally pushed by the Tom Klingenstein-supported National Civic Art Society, but an idea that has nothing to do with making Penn a great transit hub—it is a fight about the architecture. There is also a private firm, ASTM, that proposes a scheme to leverage public money to give half a billion or so to the Dolans to buy back part of MSG, then privately build a new train hall, and then charge toll-like fees to the public transit agencies in perpetuity for the use of the new train hall. Some of the public toll money would be used to pay back the public loans ASTM would take out, a kind of shell game with public money, earning ASTM between 8-12% a year. Last, there is our Empire Station Coalition—a group of 17 civic, neighborhood, and transit groups that want to preserve the historic assets around Penn and let residents stay in their homes. They have endorsed RethinkNYC’s excellent regional transit plan. They want to move the Garden, build an above-ground station without ringing it with Vornado’s supertalls, and say it can be done without evicting ordinary New Yorkers.

In all this debate, there is an elephant in the room that nobody will talk about. If ever there was a good case for using the state’s powers of eminent domain in a just and correct way, it is above the old Penn Station, not around it. Instead of using eminent domain against the Capuchin monks and other locals, use it to take Madison Square Garden and Two Penn away from the moguls. The public purpose and need for the space is undeniable. With a clean slate on the site, we could finally give the region—and country—a 21st century regional transit hub with through-running. Of course, it’s not the first time ESD got eminent domain backwards. The Institute for Justice in Washington reviewed ESD’s history and concluded that it systematically acts as “Robin Hood in reverse, taking from the poor and giving to the rich.” As the Penn case illustrates, it is a blight against our democracy that ESD won’t wield government’s eminent domain powers for the people instead of for enriching real estate moguls. Eminent domain used the right way at Penn—against the moguls instead of for them—would finally cut the Gordian knot that has made solving the Penn mess so impossible.


Lynn Ellsworth is an economist (PhD UW-Madison) and the founder of the Empire Station Coalition, the Alliance for a Humanscale City, and the Tribeca Trust. Ellsworth is also the author of the forthcoming book, Wonder City: How to Reclaim a Human-Scale Urban Life (Fordham University Press, Spring 2024).

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