New York has approved the design for the new Penn Station, to be located in the Main Post Office on Eighth Avenue, which is across the street from its current location. NY Daily News has a story.
James Lileks describes the current Penn Station pretty well:

Aside from rush hour, it was empty, and had a sad battered quality that made you feel like a rude sack of meat slumped over a ration of intoxicants. … The reality is a waiting room with insufficient signage, a great hall that isn’t, and a Hudson News thronged with balding guys, ties askew, furtively paging through battered porn mags.