Feds To Weigh In On NJ-NY Rail Tunnel Project

Top U.S. Transportation Official To Visit N.J.

TRENTON, N.J. (CBS 2 / WCBS 880 / AP) – While Gov. Chris Christie justified his decision Thursday to scrap the state’s most ambitious public works project, the federal government is stepping in Friday to attempt and bring it back to life.

LISTEN: WCBS 880’s Rich Lamb with comment from Bloomberg
WCBS 880’s Sean Adams reports from New Jersey

On Friday, U.S. Transportation Secretary Ray LaHood is heading to the Garden State to fight for the completion of the New Jersey-to-Manhattan rail tunnel.

While it is unusual for the federal government to step in on a local construction issue, tri-state area residents know that from the beginning, this project has been anything but typical.

Gov. Chris Christie said the plan to scrap the tunnel was a move to protect the long-range financial interests of New Jersey taxpayers. Supporters said the decision will have the exact opposite result.

U.S. Sen. Frank Lautenberg, D-N.J., who helped secure federal funding for the project, called the cancellation “one of the biggest policy blunders in New Jersey’s history.”

“Without increased transportation options into Manhattan, New Jersey’s economy will eventually be crippled,” he said.

More than a half-billion dollars has been spent on the tunnel — dubbed Access to the Region’s Core, or ARC — and construction began last year. The largest federal transportation project in the country, it was expected to double train traffic in and out of New York City during peak commute times once completed in 2018.

But over the years, cost projections for the tunnel also have nearly doubled.

It started at $5 billion in 2005 and grew to $8.7 billion by 2008. In recent months, Federal Transit Administrator Peter Rogoff has made public statements that put the price tag between $9 billion and $10 billion. On Thursday, Christie said his advisers put the costs at $11 billion to $14 billion.

“The bottom line is this, New Jersey has gone for too long and for too many decades ordering things that they can’t pay for,” he said at a news conference. “This project has some flaws to it, but in the end this is a financial decision. When weighing all the interests, I simply cannot put the taxpayers of the State of New Jersey on what would be a never-ending hook.”

A month ago, the Republican governor ordered a 30-day halt to all work on the tunnel over concerns that it would go over budget. On Thursday, he directed state transportation officials to explore other approaches to modernize and expand rail capacity into New York.

U.S. Transportation Secretary Ray LaHood’s spokeswoman indicated the project might not be dead. Olivia Alair said in an e-mailed statement that LaHood and Christie plan to meet Friday afternoon to “discuss a path forward on the ARC tunnel project.”

Lautenberg acknowledged that cost overruns on a project of the tunnel’s size were inevitable but said Christie’s numbers are inflated.

ray lahood Feds To Weigh In On NJ NY Rail Tunnel Project

U.S. Transportation Secretary Ray LaHood (Getty Images)

The federal government and Port Authority of New York and New Jersey had each pledged $3 billion to the tunnel. New Jersey had committed $2.7 billion. The project is being run by NJ Transit.

New Jersey Assemblyman John Wisniewski, who leads the Assembly transportation panel, accused Christie’s advisers of inflating the cost of building the tunnel to justify what they believe will be the governor’s decision and to divert the money to smaller road and rail projects. Christie has not said how he plans to use money.

The independent Regional Plan Association said Christie was using fuzzy math.

“Gov. Christie’s claim that he supports ARC but could not move forward because of budget overruns is most likely not true,” the group said in a statement. “The Federal Transit Administration (FTA) officially never released its estimates for potential budget overruns — only Gov. Christie estimates them to be in the $3 billion to $5 billion range. What’s more, Trenton has repeatedly rebuffed federal officials’ efforts to work out a cost overrun deal.”

The project had been in the works for about 20 years. Currently, NJ Transit and Amtrak share a century-old two-track tunnel beneath the Hudson River. The new tunnel would add two more tracks, more than doubling the number of NJ Transit trains that could pass under the river.

Mark Nardolillo, CEO of tunnel contractor BEM Systems in Chatum, said 10 to 15 employees he has working on it will lose their jobs.

“We don’t have alternate work to put these people on,” said Nardolillo, whose company handled environmental permits and data management for property acquisition. “This is the one job you counted on. It’ll have a devastating impact on the region.”

Commuters at New York’s Penn Station weren’t pleased to hear the project had been canceled.

“This is not good. I hope they reconsider,” said Michael Murphy, an IT and infrastructure expert waiting for a train home to Morristown. But, he added, “if they have a problem with the budget, there’s not much choice.”

Roy Gainsburg, a retired book publisher from South Orange, who still rides into the city occasionally, said commuter trains frequently get stuck in the tunnel.

“It certainly would be nice if there was another tunnel, because this one has only two tracks, so trains get stuck at peak hours,” he said.

Christie’s predecessor, Democratic Gov. Jon Corzine, broke ground on the tunnel in June 2009, a few months before the gubernatorial election that he lost to Christie.

During his campaign last year, Christie supported the project.

But as soon as he announced the work stoppage, lawmakers and transportation officials suggested Christie had planned to scrap the project and to use the state’s share of the money to pay for the nearly broke Transportation Trust Fund, which pays for local road projects and rail repairs.

Christie has refused to raise the state’s gas tax, which is among the lowest in the country, to replenish the fund.

So far, about $600 million has been spent on the tunnel project. New Jersey could be on the hook to repay half of that to the federal government for breaking its commitment.

Lautenberg has said canceling the tunnel would violate an agreement with the federal government in which New Jersey committed itself to the project in exchange for $3 billion in federal funding.

Officials have said the tunnel would create 6,000 construction jobs and add at least 40,000 new jobs after it is completed. If Christie were to divert money to the state transportation fund, that could also create jobs, depending on the projects.

Christie said staff will immediately begin a shutdown of the tunnel project.

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  • PammyB

    I think it wrong for one person to have the power to shut down this massive public works project that affects people in other states besides NJ. This is a long overdue project that should be completed.

  • Chokingongasfumes

    Can someone provide some real numbers on what NJ state gets in tax revenues? Here’s a state that’s consistently being reported as having the highest tax burden on its citizens. And yet these very same citizens are losing teachers and police and firefighters; and now they’re going to lose out on what is an economically and environmentally responsible project to improve what is arguably the largest commuter mass transit system in the nation. Where exactly than is all this money going to if it’s not being spent on improving the life of its citizens?

    • Laugh@reason

      NJ has some of the highest taxes in the nation. Why? We have 566 municipalities in one of the most densely populated areas in the nation. In Bergen County you can spit and hit 6 different tows, each with their own Mayor, Council, Police, Fire, School, Trash and other services. Same is true for the majority of the northwest portion of the state. If you want to fix our tax problem in NJ we need to combine these municipalities into a larger organization. This way we can save on common services and reduce operating expenses by at least a third. Why don’t people want to do this? Because they’ll loose their town’s Identity….

  • Toy

    I can’t say I feel sorry for New Jersey… They elected a Republican thinking that somehow he was going to look out for ALL citizens,. The police, Fire Dept., and school teachers got behind him on election day… and once in office, he reverted to TRUE republican form.. Tax cuts for the wealthy, and NOTHING for schools, the middle class and the poor….Christie is a cautionary tale for the upcoming elections.. Vote Republican and suffer draconian leadership.

  • Sparky

    We have to wait for Christies buddies in corporate america get their portion of the graft and money for the rail project before he allows this ecologically and financially important project to continue. Then he will allow 6,000 people to earn a living and get 25,000 cars per day off the highway.. Boss Tweed of New jersey strikes again!!!!!

    • Sparky

      and no I dont have proof he’s a corrupt politician…I just don’t see how a human being can have no feelings for human dignity, lie about about his own mistakes such as the education grant foul up, force the experienced teachers out of our schools and still hold his head up high…. It’s just very frustrating…

  • play ball

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  • John G

    Well the Mayor of New York says it is time to give Wall Street, big bank another tax payer stimulus payoff and do away with the Constitution of United States. When are New Yorkers going to wake up and realize their money is worthless?

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