Transit riders may never live to see Hudson tunnels completed: Analysis
Without real financial resources from not only Washington, but also New York and New Jersey, how will the Gateway Tunnel be paid for?
Release of the Federal Rail Road Administration’s draft Environmental Impact Statement confirms continuing increases in total project cost of the Gateway Tunnel Project, which is a plan to expand and renovate the train tracks under the Hudson River connecting New York’s Penn Station to New Jersey.
Two years ago, the estimated cost grew by $3.9 billion from $20 billion to $23.9 billion. Today, the new cost estimate has grown another $5.2 billion from $23.9 billion to $29.1 billion. This most recent increase is based on the estimated cost for both the new tunnel and rehabilitated old tunnel, which has grown from $8.7 billion to $12.9 billion.
President Trump's proposed new budget confirms that there is no legal federal commitment to fund the Gateway Tunnel project. Recent news that the Gateway Development Corporation is looking for private developers to help pay for the $29.1 billion new Hudson River Gateway Tunnel as part of a joint public/private partnership is no surprise. It confirms that the proposed three-way federal/ New Jersey/New York $29.1 billion funding package is primarily verbal commitments and wishful thinking. Two years later it is still not real.
The Port Authority of New York and New Jersey allocation of $2.7 billion within the approved $32 billion 10-year capital plan to help finance the Gateway Tunnel is just initial seed money. These dollars will be used toward debt service payments against a possible future federal Railroad Rehabilitation and Improvement Financing loan to the Gateway Development Corporation for this project. It has yet to be approved and will have to be paid back. Without real financial resources from not only Washington, but also New York and New Jersey, how will the Gateway Tunnel be paid for? A project can't be financed by just borrowing alone.
Language contained within the Fixing America's Surface Transportation Act (FAST) affording Amtrak the ability to use some of the $200 to $400 million in operating surplus profit it makes on the Northeast Corridor toward the new Hudson River Tunnel is not assured. This still needs future approval by Congress, and Amtrak still requires billions to fully implement real High Speed Rail on the Northeast Corridor between Washington and Boston.
On top of that, nobody knows how much emergency repairs over the next 18 months at Penn Station will cost. This doesn't include billions more for routine State of Good Repair, Safety, fleet equipment replacement and upgrades to bridges, stations and the East River tunnels. The MTA, Amtrak, NJ Transit and Port Authority of NY & NJ Transit all need billions more in coming years, just to reach a state of good repair. Transit riders may never see the Gateway Tunnel completed in their lifetime.
Larry Penner is a transportation historian and advocate who previously worked 31 years for the US Department of Transportation Federal Transit Administration Region 2 NY Office.