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MTA Threatens Lawsuit Over Frozen Second Avenue Subway Reimbursements

The agency set a March 6 deadline following months of withheld payments under a federal review of DBE contracting rules.

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A section of Phase Two of the Second Ave. Subway line near E. 112th St. in Manhattan is pictured Tuesday, Nov. 23, 2021, in Manhattan, New York. (Barry Williams for New York Daily News)
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MTA Chair Janno Lieber wants to turn this abandoned hole in the ground into a new subway line.

Overview

  • The U.S. Department of Transportation has not reimbursed the MTA since October, with at least $58,652,146.02 past due for Phase 2 extending the Q line to 125th Street.
  • In a letter sent by outside counsel at Gov. Kathy Hochul’s direction, attorney Roberta Kaplan warned the MTA will seek expedited judicial relief if funds are not released by March 6.
  • MTA officials say they complied with requested changes to the Disadvantaged Business Enterprise program and were later locked out of the federal payment portal, indicating more invoices may be unpaid.
  • The payment freeze threatens the award of an imminent excavation contract for new East Harlem stations, creating schedule risk and potential cost increases.
  • The move comes after a Manhattan judge ordered the release of Gateway Tunnel reimbursements earlier this month, a precedent the MTA cites as it presses for Second Avenue payments.