The 23rd-floor office of Yochanan Or, CEO of Metro Transit Solutions (MTS), the company in charge of building and operating Tel Aviv's first subway system - an NIS 10 billion project, the first of its kind in Israel - overlooks half of Tel Aviv. On Or's office walls are two charts. One is a map of the city, crisscrossed by colorful lines in all directions. The other looks like a cross between a building diagram and an ant farm. The map depicts the projected routes. The diagram is an incredibly elaborate timetable that shows what has to be done before the work is complete. If everything goes according to plan, when Or looks down on the city five years from now, he will see fewer cars, buses and taxis driving through the streets. On clear days, when he stretches his neck to look to the north and to the south, he will see trains emerging from underground. Today, however, it takes more than a good imagination to envision this future. One needs to put on rose-tinted glasses to look past the challenges facing the project. The idea of running a subway beneath the busy streets of Tel Aviv is not a new one. Plans for such a project have been placed on the desks of every prime minister, transportation minister and Tel Aviv mayor since the founding of the state. Natan Alterman wrote a poem about the missed opportunity for a subway as far back as 1936, when Tel Aviv had only 150,000 residents. Today, when more than 3 million people live in the greater metropolitan area and the streets are congested and polluted, a fast, clean and efficient mass transit system seems more necessary than ever. For a variety of reasons, most central being the different government agencies and planning committees' inability to agree on a viable arrangement, none of the plans have come to fruition and Tel Aviv, though advanced in other areas, still has a serious transportation problem. All that was supposed to change in 1997, when the Finance and Transportation ministries formed the government-owned Metropolitan Mass Transit System (NTA) to provide solutions to traffic problems in the Dan Region. AFTER PICKING up the reins, NTA quickly hired a team of 90 experts and shortly afterwards presented its vision - a network of seven color-coded transportation lines spreading from Ra'anana and Kfar Saba north of Tel Aviv, all the way to Rehovot in the south and Ramle, Petah Tikva and Yehud in the east. The plan calls for a mixture of underground and surface rails as well as lines that will be based on BRT (Bus Rapid Transit). Altogether, the system is designed to spread over 176 kilometers and projected to carry 1.42 million people a day once it's completed. NTA has calculated that such a system, once running, will save the economy 48 million work hours a year, reduce CO2 emissions by 201,000 tons per year and reduce 6,500 car accidents every year. NTA Director Yishai Dotan calls the system "essential." He likens the current public transportation situation, in which a network of trains and highways feed commuters into the city, where they then get stuck in gridlock and need to search for parking, to a grand, state-of-the-art waterway that brings water into a city and then distributes it to people's homes by oxcarts and buckets. "It's ridiculous that people who drive across half the country in 50 minutes then have to spend the same amount of time traversing the few blocks to where they want to go in the city," Dotan tells The Jerusalem Post. THE FIRST line on which planning was completed was the Red Line, the system's backbone, which starts from Petah Tikva, runs through Bnei Brak, Ramat Gan, Tel Aviv and Jaffa and ends in Bat Yam. The line, which spans 23 kilometers (half of it underground), will take passengers from one end to the other in about 45 minutes and is planned to carry nearly 400,000 passengers every day. During rush hour, trains will stop to pick up and drop off passengers at the 33 stations every two or three minutes. The trains will run from 5:30 a.m. until midnight every day except Shabbat. In October 2003 an international tender for the Red Line was put out. The tender offered a B.O.T. (Build Operate Transfer) model for 32 years, after which it will be turned over to the government. Four groups, all made up of Israeli and foreign partnerships, took up the challenge and three ended up with qualified bids. On December 31, 2006, the winner - MTS, a group made up of six companies (two Israeli and four international) - was announced and given the green light to go ahead and start detailed planning and construction on the line. One of the main reasons that MTS was chosen, aside from its bid, which was NIS 400 million lower than the other groups, is because it offered a different tunneling method than its competitors. While the other two groups proposed using the cut-and-cover method, in which the different segments of the tunnel are built on the surface before covering them up and continuing on to the next, MTS proposed the deep-mining method, in which the majority of the tunneling is done underground, without having to disturb life on the surface. MTS IS owned in equal parts by Israeli construction giant Africa Israel, the German Siemens, Egged, the Chinese civil engineering cooperative CCECC and the Portuguese infrastructure firm Da Costa Soares. All of the companies, aside from owning stock in the project, bring their respective strengths to the table. Along with Dutch rail operator HTM, the five stockholders all joined MTS in its offices in Azrieli and started working toward their goal. Or is the person charged with overseeing this miniature United Nations. "In a situation like this, you can either get the Tower of Babel or an 'ingathering of the exiles.' We are aiming for the latter because, believe me, connecting Chinese with Portuguese with Germans and Israelis has the potential to be a real catastrophe," said Or, the former director of Derech Eretz, the company that built and operates Highway 6. Things haven't gone smoothly. Not because of the makeup of the group or Or's management abilities, but because of the global economic crisis. Last year, MTS's financier, the Royal Bank of Scotland, lost 28 billion pounds, collapsed and was nationalized. The collapse, which could have dashed MTS's dreams, meant the company needed to find an alternative source for the loans, and fast. MTS asked the state for an extension and in the meantime attempted to strike a deal with a group of nine banks, both local and foreign, in an effort to get the project back on track. Israel's record in building mega-projects like this one could be described as spotty. Alongside successful projects, like the Trans-Israel Highway or the National Water Carrier, are projects like Ben-Gurion Airport's Terminal 3, which opened four years behind schedule; the over-budget and over-schedule Jerusalem-Tel Aviv rapid train line; and the much touted Red Sea-Dead Sea canal, which has yet to be started. Perhaps the worst example of a major project run amok is Jerusalem's light rail system, on which construction was started in 2006 and which was supposed to be completed in February of this year. As any Jerusalem resident can report (probably attached to a colorful string of expletives), construction is still in the works and it is now only scheduled for completion in 2011. The Jerusalem light rail project represents Or's worst nightmare. Not only is his project constantly linked to it in public debate and in the media, but the banks he's requesting loans from are also wary of lending money to a project that might suffer from the same fate. "We are currently on our third extension from the state. By the end of September we're supposed to clear all the issues that the banks have raised as deal breakers," Or says, adding that there are seven points the banks demand be addressed before they agree to commit the money. "The most troublesome issue is that of licenses and permits. The lessons that were learned from Jerusalem show that this is the 'Via Dolorosa,'" says Or. "In Jerusalem, they only had to deal with one municipality; in our case it means dealing with five." Or explains that the banks are not willing to put themselves in a situation in which they are subject to municipalities' whims. "Local authorities, as we well know, are bodies that don't operate from purely practical considerations and are often driven by politics. We asked the government to guarantee to intervene and set down specific timetables that will be honored by all the involved authorities," he says. ANOTHER ISSUE in contention is the extent of any potential government safety net. The banks estimate that ridership on the line won't be as high as the state expects and wants it to increase the guarantee arrangements. The state has committed to make up the difference in earnings if ridership on the line is, in fact, less than anticipated. A third demand is that the government take on the role of insurer of last resort. "The global economic crisis has made insurance harder to come by. The government has agreed. All that remains is to discuss the premium level," says Or. Other issues under debate are things like whether MTS's inspectors will have the authority to enforce ticket payment; the question of who will license train conductors; requests to allow 24-hour construction work; issuing working visas for the 3,000 foreign experts and laborers that MTS is bringing into the country and whether or not the trains will have right of way at intersections. Moreover, the two sides have yet to agree on what will happen if the project is canceled before the contract expires. The banks want government guarantees that they will get most of their money back. The final dispute is on the drawn margin. The breakup of the debt and the time that has passed since the initial negotiations has raised the premium of the loan by about one percent. ALL PARTIES involved have been following the Jerusalem light rail's progress carefully and promise that things will be different with the Dan Region project. Tel Aviv municipal workers, who have been working on the project for the last 15 years, don't want to be tarred with the same brush as their Jerusalem counterparts. They reject the accusation that they are barriers to the project and insist that they are fully behind it. Back in 1993, Tel Aviv formed a special task force under the city engineer's office to oversee the light rail project, and Mayor Ron Huldai includes the light rail as an integral part of the city's overall vision for the future. "The municipality has committed to NIS 300 million spread over several years. We see the project as one of our top priorities, serving as an example for all the other municipalities, and have backed it all the way," says Eldad Merchav, the deputy city engineer who heads the municipality's Light Rail Authority. The city's job is to provide building permits and clear the way for the line builders. Merchav says it is doing all it can to make sure everything is done in advance of construction and with minimum effect on the local inhabitants. "One of the reasons we insisted on a subterranean route is because it will reduce the impact on our residents. We know that because of the nature and magnitude of the project, people will suffer while the construction is ongoing and we want to try and minimize the harm." No matter what measures are taken in advance, nobody seems to doubt that the project's five-year construction phase will be difficult and unpleasant for Tel Aviv's residents. The subterranean section alone, which starts at the Geha intersection west of Petah Tikva and surfaces in Jaffa, mandates the digging of two seven-meter wide and 13.5-kilometer-long tunnels, and then the placement of 10 three-story underground stations. Despite the fact that most of the digging will be done underground using special, custom-made giant drills, there is no avoiding the necessity of digging 70-meter-deep shafts at some of the city's busiest intersections for the stations and removing the excess soil from the tunnels in trucks. On the surface, the tracks cross 50 of the region's busiest intersections, apparently promising that while construction is ongoing, traffic will be worse than ever. ONE ISSUE that remains a mystery is how the tunneling will be affected by the water table. Because of the deep mining method used, experts estimate that the builders will have to pump out roughly 70 million cubic meters of groundwater, likely impacting the underground aquifer. MTS has planned a water purifying station so that most of the water pumped out will be converted into drinking water, but no one can know the exact makeup of the soil until the tunnels get closer, in which case they may find harmful substances that will have to be removed before proceeding. To assist residents and business owners during the construction stage, both NTA and the municipalities have allocated money for hotlines where citizens can log complaints, request information and notify of any mishaps. NTA is providing outreach services to city residents and has held dozens of meetings with local businesspeople. The company's overall message is that though people may suffer in the short term, they will benefit once the train is up and running. "This project is like conducting open heart surgery on the city. It will definitely make daily life more difficult, but all the bodies involved have made a joint commitment to minimizing the harm," says Dotan. Because of concerns that the Tel Aviv rail project will turn out like Jerusalem's - there, too, the troubles started when the operating company City Pass couldn't conclude its financial arrangements in time - the Tel Aviv project will be overseen by an unprecedented number of supervisory bodies. Apart from NTA and the municipalities, the government has formed a special supervisory committee made up of representatives of county planners, city engineers, a representative from NTA and representatives from the Transportation and Environmental Protection ministries. ALMOST EVERYBODY involved in the project is convinced that it will be seen through, that there is no turning back and that the state will have to find a way to ensure backing from the lenders so that MTS can finally reach financial closure and get the final go-ahead to start construction. Even while waiting for negotiations between the Finance Ministry and the bankers to see things through, NTA is investing resources in clearing infrastructures from the projected corridor and the municipalities are issuing the necessary permits to get ahead of the game. "It won't do anyone any good, there is no other option. If the government decides to put the project to the side today, they'll have to face it again tomorrow," declares Dotan.