L Train Riders Go Wild With MTA At Neighborhood Meeting About Tunnel Repairs

The Bedford Avenue stop on the L train. (Roshan Vyas)

Subway riders along the L train route pressed officials from the Metropolitan Transportation Agency on Thursday night, during the first public meeting in Williamsburg to consider closure options for the train’s Canarsie Tunnel.

The agency has faced an outcry from residents and business in the area, after announcing that it needs to close the tunnel starting in 2019, to repair damage from Hurricane Sandy. That could take the form of a complete closure of both tunnels for 18 months, or the closure of one tunnel that would allow only 20 percent of current traffic, over a period of three years.

The community meeting included an unusual array of the MTA’s top officials, including Chairman Thomas Prendergast; Veronique Hakim, president of NYC Transit; M.T.A. Chief of Staff Donna Evans.

“I’ve been to many community meetings, but I’ve never been to one like this, complete with video, the top brass of the M.T.A., they even have the equipment damaged by Sandy,” said Rep. Carolyn Maloney, who was one of several elected officials who were also in attendance at the Marcy Avenue Armory.

In her opening presentation, Hakim noted that the M.T.A. intended to offer the eventual contractor incentives to finish the construction faster, with the selection to be based on a competitive negotiated procurement, rather than the lowest bid. But she added that the incentive might be less effective under the one-tunnel option, in which the contractor would have less control of the site.

Later, Prendergast said he was confident about the estimated work time.

“But we’re also going to challenge the contractor … if there are other things you could do … and cost was not an object, what means would you use,” he said. With the earlier restorations, contractors had ended up using some technology approaches that the M.T.A. had not thought of, he said, emphasizing that “we’re going to push to see if we can improve” the timeline.

Many of the questions submitted by attendees at the meeting concerned details about planned adjustments to alternate routes, including the M and G lines, opening shuttered entrances, and bus and ferry service.

NY1 anchor Pat Kiernan, who lives in the area, submitted a question about the lack of a subway shuttle between Bedford Avenue and Lorimer Street during the one-way option.

M.T.A. officials said there would not be enough space for workers to access the construction site and expressed general concern about Bedford Avenue’s capacity.

Staff also said they were working on boosting the agency’s bus and subway fleet ahead of the outage and hope to begin more frequent service on other lines before the closure so riders can get accustomed to other options, especially on the subway.

A real estate broker from the area commented that they were already seeing tenants dropping out of leases and called for the city to institute tax reductions or abatements so landlords can offer rent discounts during the closures.

One woman expressed concern about how her son with a mental disability, who she said struggles with change, would adjust to the closures.

“I truly understand that impact,” Prendergast said, emphasizing the importance of communicating the changes both to New Yorkers confident about alternate routes and those more dependent on their routines.

One comment in favor of the three-year-option was immediately followed by another asking “where [the MTA] was three years ago,” if the agency is now saying there is not enough time to plan and build another tunnel.

Prendergast explained that the M.T.A. was first working on the other tunnels to gain the experience and carefully plan for the Canarsie closure, and didn’t want to close too many tunnels at once.

Another attendee urged the M.T.A. to “seriously consider” an East River Skyway cable car proposal. “That’s not for us to [consider],” Prendergast said, pointing to the M.T.A.’s dedication to buses and trains, adding that it would be up to “someone else” to explore that further if there was interest.

One commenter also suggested that former Mayor Michael Bloomberg should fund a new tunnel that could be drilled using “modern technologies.”

Lawmakers also encouraged the M.T.A. to consider more creative and “out of the box” measures. Assemblyman Joe Lentol called for a weekend bus service between Williamsburg and Times Square. “I don’t want you to forget that Williamsburg … is happening.”

Maloney evoked the work related to the Second Avenue Subway, and a series of report cards issued by her office.

“Where they got an A was responding to the community,” she said, calling for Brooklyn to get the same consideration, and noting the formation of the L Train Coalition community group.

Rep. Nydia Velazquez expressed concern about the impact on small businesses and emphasized the importance of an “open, inclusive and transparent process.”

Comptroller Scott Stringer also called for creating a partnership with the community and making an effort to monitor the progress and the effects of the construction in real-time using technology. He also referred to the Second Avenue Subway experience. “Even when we did not out agree on outcomes and goals when there was real collaboration we made progress,” he said.

State Senators Dan Squadron and Martin Dilan, as well as Councilman Antonio Reynoso also spoke.

M.T.A. officials said they expected to make a decision in the next few months and select a contractor before the end of the year. Another public meeting is taking place in Manhattan next week.

Miranda Neubauer

Sanders Accuses DNC of Tipping Convention Toward Clinton

ernie Sanders is accusing Democratic National Committee chairwoman Debbie Wasserman Schultz of trying to tip the party convention in Hillary Clinton’s favor, saying the chairwoman has packed the committees with Clinton supporters.

In a letter to the chairwoman, Sanders noted that of the 45 names he submitted to Democratic National Convention committees, Wasserman Schultz appointed only three.

“I believe the composition of the standing committees must reflect the relative support that has been received by both campaigns,” Sanders wrote in the letter dated May 6. “That was why I was so disappointed to learn that of the over forty people our campaign submitted at your request you chose to select only three of my recommendations for the three standing committees. Moreover, you did not assign even on of the people submitted by our campaign to the very important Rules Committee of the Democratic National Convention.”

Sanders said that if the disagreement over convention committee appointments is not resolved, he would have his delegates move to change the platform on the floor of the convention.

“It is my hope we can quickly resolve this in a fair way,” Sanders wrote. “If the process is set up to produce an unfair, one-sided result, we are prepared to mobilize our delegates to force as many votes as necessary to amend the platform and rules on the floor of the convention.”

Sanders’ chances of taking the Democratic nomination have decreased, as he has a deep disadvantage in both pledged and superdelegates. But the insurgent candidate has vowed to continue on, and his deep run into the primary gives him additional leverage to pull the party to the left.

In his letter, Sanders also mentioned the Democratic Party platform drafting committee. In the letter he recounted Wasserman Schultz had discussed changing the process for selecting members of the committee.

“In our conversation, you told me with respect to the platform Drafting Committee that you would consider allowing each campaign to submit ten names from which you would choose four from each and then you would add an additional seven,” Sanders continued. “While having four members on the Drafting Committee is an improvement, it does not address the fact that up to this point Bernie 2016 has secured 45% of the pledged delegates awarded. Frankly, we believe that percentage will go up in the coming weeks and, of course, we hope it will end up being a majority.”

Sanders argued that each campaign should be able to pick seven members for the committee with the fifteenth member being one picked by both campaigns.

“This process will also ensure that the chairs of the standing committees conduct their proceedings with fairness and transparency,” Sanders argued.

In its response to Sanders letter, the DNC released a statement saying both campaigns would be represented at the convention.

“Because the Party’s platform is a statement of our values, the DNC is committed to an open, inclusive and representative process,” the DNC said in a statement. “Both of our campaigns will be represented on the Drafting Committee, and just as we did in 2008 and 2012, the public will have opportunities to participate”

Daniel Strauss, Politico

Blockchain as a service may be in your future — like it or not

Although consumers have been reticent about digital payments, new services — such as Venmo and blockchain — are making the benefits of mobile payments difficult to deny.

As digitization and mobile devices overtake virtually every corner of business, they are upending the traditional services that consumers take for granted. Think financial transactions.

Digital payments have been disrupting cash and credit cards for several years. Mobile wallets, or digital payments, enable consumers to pay for items with a smartphone or tablet using services such as Apple Pay and Google Wallet. With these mobile payments, consumers may accrue loyalty points for future discounts, or simply circumvent the hassle and insecurity of cash and credit cards. They are also compelling for lower-wage earners who don’t have credit, or for Millennials who want more flexible payment options. Despite concerns about data security risks and flimsy ROI, digital payments may be nearing the tipping point for adoption.

Even traditional technology vendors — Microsoft included — are getting in on the action. Microsoft has been hard at work on a blockchain as a service offering (BaaS) to be hosted on its Azure cloud. Blockchain technology enlists a distributed digital ledger. It eliminates the single point of failure of traditional credit and doesn’t need a central authority, such as a bank. It is transparent, secure, outage-resistant and auditable, making it appealing to industries and consumers in search of greater levels of security.

An executive at a southeastern retail company who requested anonymity said he wants to ramp up his digital payment offerings, and is looking at technologies like blockchain — once consumers and the market rally around certain options. “We use Apple Pay, but we are waiting to see which other services we want to bring on and if customers really want them,” he said. “We don’t want to offer everything under the sun.”

This week, Microsoft furthered its foray into blockchain as a service. It formed a partnership with the R3 Consortium — a collection of major banks, including Citigroup, Barclays and Wells Fargo — to promote and extend BaaS through infrastructure and tools on the Azure platform.

“R3 and member banks will experiment and learn faster, accelerating distributed ledger technology deployment,” said Peggy Johnson, executive vice president of global business development at Microsoft, in a statement.

Kevin Shuba aims to take OmniTRAX to new supply chain heights

“If you take care of your customers and your people, you’re going to be successful,” says OmniTRAX Inc. CEO Kevin Shuba

By Deborah Huso

During the three years that Kevin Shuba has shepherded Denver-based OmniTRAX Inc., the company has acquired three short lines, boosted rail traffic and nurtured industrial development opportunities.

That OmniTRAX is on the growth track isn’t surprising to those who know Shuba and have watched his logistics career over the past two decades. Prior to joining the company as chief executive officer in 2013, he held numerous management roles at global logistics services company Brambles Ltd., including group senior vice president, containers and automotive; group president, CHEP Americas, a Brambles company; and president, CHEP USA.

Shuba spent 16 years with Brambles, helping to grow the company into a $6 billion enterprise by promoting expansion of CHEP’s container business in the automotive, petrochemical and food businesses. CHEP, a logistics solutions company specializing in the management of standardized unit-load equipment, also grew via acquisition during his tenure.

When Shuba left Brambles in 2012, he thought about buying and running a transportation logistics company of his own. It didn’t happen.

“How I ended up [at OmniTRAX] is a matter of luck, timing and relationships,” Shuba says.

Through a professional acquaintance he heard that Pat Broe was aiming to grow his family business, The Broe Group, which owns Broe Real Estate Group, Great Western Oil and Gas Co., and OmniTRAX. After meeting Broe, Shuba was intrigued.

“You don’t get a lot of opportunities to work with a successful entrepreneur who has built three lines of business,” he says.

You also don’t get many chances to helm the third-largest short-line holding company in North America. OmniTRAX owns 20 short lines that operate in 12 states and three Canadian provinces. The railroads interchange with all seven Class Is and carry an array of commodities, notably clay, stone, aggregates, chemicals and grain. OmniTRAX also offers terminal, transloading, material handling and industrial development services.

A team builder

Although Shuba had no rail experience before coming to OmniTRAX, he’d developed relationships with a number of rail shippers during his tenure at CHEP, including Georgia-Pacific, Unilever and Procter & Gamble.

“Business is business,” Shuba says. “If you take care of your customers and your people, you’re going to be successful.”

Shuba acknowledges he had a learning curve and appreciates the mentorship he received from former RailAmerica Inc. CEO John Giles — now CEO of the Central Maine & Quebec Railway — who served on OmniTRAX’s board for a year.

Among the industry leaders Shuba recruited was longtime railroader Ed Harris, who joined the OmniTRAX board in 2014. Harris, who has held senior management positions with Canadian Pacific, CN and the Illinois Central, was named OmniTRAX’s chairman last month. Shuba also enlisted a couple of C-level executives: Chief Strategy Officer Pierre-Luc Mathieu, who’d previously been with Brambles; and Chief Commercial Officer Peter Touesnard, who’d been with RailAmerica.

Shuba has a long history as a team builder, current and former colleagues say.

“Kevin had to build his team at CHEP,” says Cliff Otto, CEO of Saddle Creek Logistics Services, who was instrumental in hiring Shuba as part of CHEP’s sales team. “He did not inherit a team. He hired his team and trained them.”

Shuba also has “excellent leadership skills” and he isn’t a micromanager, says Brian Malloy, an independent consultant for OmniTRAX and a former CHEP senior vice president.

Kevin Shuba
Photo: OmniTRAX Inc.

“He has a genuine belief in the potential of good people, and he’s great at bringing excellent people into organizations,” he says, adding he has known Shuba for more than 20 years. “Then he supports them.”

Shuba’s greatest professional strength is his ability to think strategically, Malloy adds.

“He can see many steps down the road to what an organization can be,” he says.

Not being a railroader helped him see what OmniTRAX could be, Shuba says.

“Having a different set of eyes has brought some value to this organization,” he says. “Customers’ perception was that rail people are hard to do business with. We brand ourselves as making rail easy.”

From the mouths of customers

A simpler supply chain is what OmniTRAX customers want — and they’ve told Shuba that they’ve found railroads are difficult to conduct business with, and that the shipping process historically has been overly complicated.

“We didn’t always understand the whole supply chain,” Shuba says.

The aim, then, is to make OmniTRAX into more than a short-line operator. The idea: A customer should be able to come to the company and when possible, through one point of contact, manage his or her shipping needs all the way from the oil rig to the Pacific Ocean, with OmniTRAX managing all the shipping in between — from a short line to Class I to rail transfer to truck.

Hence the OmniTRAX tag line: “Rail Made Easy.”

It may be too early to determine if the approach is working, but OmniTRAX roads have performed well in the aggregate. While 2015 represented a down market for many North American railroads, OmniTRAX roads moved more than 300,000 carloads last year, a 5 percent increase compared with the previous year’s total.

Saddle Creek’s Otto isn’t surprised that OmniTRAX short lines are posting growth under Shuba’s watch.

“In its broadest definition, transportation logistics covers everything from railroads to trucking companies,” he says. “Services are different, but you’re still building long-term relationships with customers. … Kevin could take [his] skills anywhere.”

Adds Malloy: “[Shuba] develops very strong relationships with people, not just in the organization where he works, but with people outside it, too.”

Shuba, who plans to continue nurturing those relationships, is excited about the future of OmniTRAX and the rail industry as a whole.

“It’s an outstanding business and has such a legacy,” he says. “Rail has shown the ability to adjust to change.”

More growth coming

The short-line industry will need to continue adapting if small roads are to continue growing — specifically, to take more freight off the highway.

“How do we solve supply chain problems like delivering fresh vegetables on time?” Shuba asks. “How can we gain more market share in markets we haven’t traditionally served?”

Of course, cultivating business from existing customers is crucial, too — it’s one of the legs of his growth-strategy stool, Shuba says. The ability to leverage The Broe Group’s real estate arm — discovering property that’s close to existing rail lines, buying it and developing it — definitely helps.

Another leg is industrial development. Shuba points to the company’s Great Western Industrial Park in Windsor, Colo. OmniTRAX and its Broe Group affiliates have spent the past several years developing the park, which is served by OmniTRAX’s Great Western Railway of Colorado LLC. The park is home to facilities established by companies such as Vestas Wind Systems A/S, Front Range Energy LLC, Halliburton, Eastman Kodak Co., Musket Corp. and Cargill Inc.

“We’ve brought 15 customers to that park in the last 10 years,” Shuba says.

He wants to build that same kind of success in Brownsville, Texas. In June 2014, OmniTRAX forged a 30-year lease agreement with the Brownsville Navigation District to operate the Brownsville & Rio Grande International Railroad (BRG), which serves the Port of Brownsville.

As part of the BRG acquisition, OmniTRAX established a strategic partnership with the port to develop the GEOTRAC Industrial Hub. The GEOTRAC project will provide rail and port services alongside a master-planned heavy industrial park, all within eight miles of the Mexican border. BRG’s network includes 45 miles of track throughout the district and five miles in the city of Brownsville. The short line interchanges with BNSF Railway Co. and Union Pacific Railroad, and has an intermediate connection via UP to Kansas City Southern de Mexico S.A. de C.V.

A third leg of the stool, and one OmniTRAX has been leaning on successfully for years, is acquisition. In addition to the BRG, OmniTRAX has acquired two railroads in the past year and a half: the Peru Industrial Railroad LLC and Sand Springs Railway Co. OmniTRAX officials are considering three or four other sites with affiliated short lines for GEOTRAC-like development opportunities, Shuba says, declining to provide specifics, but adding that the strategy includes expanding the OmniTRAX footprint in Canada.

Currently, OmniTRAX is in negotiations with Northern Manitoba First Nations for the latter’s purchase of the Port of Churchill and Hudson Bay Railway Co.

Malloy, for one, is looking forward to seeing where Shuba takes OmniTRAX next.

“Kevin has what I would call executive courage: In order to deploy strategic ideas and to move a company in a different direction, you have to have the courage to act,” he says.

“Kevin has the competence to invest large amounts of money ahead of the curve. A lot of executives wouldn’t have the courage to go to the board and ask for that kind of risk.”