The majority of New York City’s capital projects are over their initial budgets and behind schedule, suggesting better monitoring and reporting could lead to adjustments to improve capital project delivery, according to an analysis released today by State Comptroller Thomas P. DiNapoli.

“New York City’s capital projects too often experience delays and cost overruns, though efforts are underway to improve the process,” DiNapoli said. “Given limited resources and an escalating cost environment, the city should monitor its capital spending in a more uniform and comprehensive manner so it can review funding expectations, prioritize where additional work is needed, and maximize the return on every capital dollar it spends.”

The city is shifting from publishing the Capital Project Detail Data (CPDD) report to a Capital Projects Dashboard, but both currently have limited project delivery information. DiNapoli’s analysis looked at projects listed in the October 2023 CPDD, which contains project schedules by phase, the initial and current budget, and explanations of any delays for particular projects. This detail is not yet fully reflected in the dashboard. Also, many projects are excluded from the CPDD, and data on budgets and schedules lack certain details that would benefit capital project monitoring.

The CPDD excludes almost half of the projects included in the city’s Capital Commitment Plan (CCP), amounting to $73.9 billion, or 47.2% of all planned capital commitments. While a substantial portion of this may be for projects that are not yet fully scoped out, there are a number of notable exclusions. City-funded projects undertaken by the School Construction Authority for the NYC Department of Education, as well as loans for housing and certain other projects managed by NYC Housing Preservation and Development, totaling about $38 billion, make up the largest share of excluded projects.

Among the 5,128 projects that were analyzed, DiNapoli’s report found:

• 64% were delayed, defined as projects with tasks at least three months past their planned completion date.
• Half, 49.9%, were excessively delayed, with tasks three or more years behind their completion date.
• More than 50% were over their initial budget, with planned spending now at $54.5 billion more than initially anticipated. Nearly two-fifths of all analyzed projects were more than 20% over budget. DiNapoli’s report also found about 27% of projects were on budget, and 21% were under budget.

Of the nearly three-quarters (73%) of delayed projects, more than half were delayed because of budgetary constraints. These constraints are not clearly defined by the city but may be due to a lack of capital funding in the city treasury during the project span or changes to funding commitments. However, because the city does not explain what is causing budgetary constraints and how they are contributing to delays, updates to cost estimates are difficult to predict. It is notable that the analysis period included the onset of the pandemic, where capital projects were halted, which likely contributed to delays.

The report found certain types of projects are more likely to be behind schedule or over budget than others. Courts, waterway bridges, water supply, traffic, highways, public buildings, library, and economic development projects were all likely to start more than two years after the initial project sequencing start. Similar delays existed for NYC Health + Hospitals as well as the police and cultural affairs departments. The movement of start dates directly impacts the cost of projects, as prices of labor and materials generally rise over time.

Certain project types were also more likely to end up over budget. More than half of sanitation, water pollution, water mains, highway bridges, courts, and cultural affairs projects were excessively over budget, going 20% over original cost estimates. Projects that spanned multiple areas were also more likely to experience cost overruns, suggesting more focus on coordination and complexity may be desirable in scoping the work and prior to estimating necessary funding. Greater detail is needed on whether recent actions to improve management of complex projects by the Department of Design and Construction have been successful.

Three of the largest projects examined were for the Department of Transportation, including in-house asphalting and in-house non-asphalt, both citywide projects, as well as partial rehabilitation of the Brooklyn-Queens Expressway. For the two road maintenance projects, the original budget was $891.3 million, and actual spending has reached $1.7 billion. The total budget for these items is now $3.5 billion, nearly four times the original amount. Detailed reporting is essential for ensuring projects adhere to their budgets.

While there is no explanation provided for the cost overruns, budgetary constraints were noted in a number of cases. Still, it is unclear how constraints have held back the projects.

The city recently took steps to reduce the size of its capital program, in part because of statutory debt limitations and its debt burden policy. The recognition of capital spending impact on debt limitations raises questions over the execution of the city’s capital plan in recent years, which has more than doubled in size since 2015. While a significant portion of the increase is due to new projects, this analysis suggests a large amount is also attributable to underbudgeting for the majority of projects it undertakes.

The cost of project delays and unforeseen circumstances must be further understood for the city to effectively manage capital project spending. Recent reforms to the city’s capital planning process have focused on streamlining the delivery of projects, but little detail is available in public documentation about what is fueling these cost and schedule overruns.

DiNapoli recommended the city shift all relevant project information to the new dashboard, provide regular updates on the status of its reforms to review the effectiveness of changes implemented for reducing costs or delays, and add flags that allow the public to identify projects which have been able to leverage those reforms. With closer, more uniform monitoring of capital projects, the city can better identify where additional improvement is needed.

Report
A Review of NYC Capital Project Delivery

Fiscal Tracking Tools and Other Reports
Review of the Financial Plan of the City of New York
Agency Services Monitoring Tool
Fiscal Cliffs in New York City’s Financial Plan