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Dead tunnel to New York features $5B wage loss

Governor Chris Christie cut New Jersey off from $5 billion in New York-based salaries and diminished its future role in the world’s second-largest regional economy when he stopped construction of a Hudson River rail tunnel he said taxpayers couldn’t afford.

Governor Chris Christie cut New Jersey off from $5 billion in New York-based salaries and diminished its future role in the world’s second-largest regional economy when he stopped construction of a Hudson River rail tunnel he said taxpayers couldn’t afford.

The first-term Republican canceled the $9.8 billion tunnel, the country’s largest federally supported infrastructure project, on Oct. 27. New Jersey, which already faces a $10.5 billion budget deficit next year, couldn’t accept a “blank check” on cost overruns that might exceed $5 billion, said Christie.

Christie’s move means the state will have to repay the U.S. government $350 million already spent on the project, forgo $3 billion in additional federal aid and lose the 3,000 construction-worker openings the tunnel was projected to generate for the next decade. Canceling the tunnel will also cost New York and New Jersey 44,000 jobs and $4 billion in additional income that would have come through economic growth, according to a 2008 study by New Jersey Transit.

By the numbers

51%
New Jersey residents supported Christie’s decision to kill the tunnel 51 percent to 39 percent, according to a Rutgers-Eagleton poll by New Brunswick-based Eagleton Center for Public Interest Polling.

52
Among New York commuters, 52 percent said they disagreed with the decision, according to the poll.

$18B
The Regional Plan Association, a New York research group that supported the tunnel, said home values within two miles of train stations on lines running into the project would have increased by $18 billion, generating $375 million in additional property-tax collections each year.

25,000
Completion of the so-called ARC tunnel, for Access to the Region’s Core, would have added room for 25,000 additional daily commuters, according to the Federal Transit Administration.

$440K
At $10.9 billion, the midpoint estimate provided by the U.S. Department of Transportation last month, the scrapped project would cost almost $440,000 for each of the 25,000 commuters it added to the transit system, said Gus Milano, executive vice president of closely held Hartz Mountain Industries.

 
 
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