Here is why the $29 billion Gateway Tunnel project other than the $1.6 billion Portal Bridge is not proceeding forward.
Acting Federal Transit Administration K. Jane Williams June 29t Dear Colleague letter stated “Before advancing a project, Section 5309 requires FTA to evaluate all projects seeking Capital Investment Grants funding on local financial commitment.
Given the competitive nature of this discretionary program, the statue specifically urges FTA to consider the extent to which the project has a local financial commitment that exceeds the required non-governmental share of the cost of the project.
To this end, FTA considers U.S. Department of Transportation loans in the context of all Federal funding sources requested by the project sponsor when completing the CIG evaluation process, and not as separate from the Federal funding sources.
Strong local financial commitment and stable, reliable, and dependable non-Federal funding sources are necessary for all projects to do well in the CIG program.
Previous governors of New York and New Jersey found billions in hard cash for their local share to obtain FTA New Starts funding for the following projects.
These include NJ Transit’s Hudson Bergen Light Rail Minimum Operating Segment One ($992 million), Segment Two ($1.2 billion) and Secaucus Transfer ($450 million).
The Metropolitan Transportation Authority did the same for Long Island Rail Road East Side Access to Grand Central Terminal ($10.8 billion) and Second Avenue Subway Phase One ($4.5 billion).
None of these projects required a federal Railroad Rehabilitation and Improvement Financing or Transportation Infrastructure Finance and Improvement Act loans.
The Gateway Tunnel Portal Bridge ($1.6 billion) and Hudson River Tunnel ($11 billion) portions along with Second Avenue Subway Phase 2 ($6 billion) are currently in the first phase of FTA’s New Starts program known as “Project Development.”
MTA Second Avenue Subway Phase 2 has $1.7 billion in approved local funding within the MTA $32 billion 2015 – 2019 Five Year Capital Plan.
The MTA intends to program an additional $2.3 billion in local funding within the next MTA 2020 – 2024 Five Year Capital Plan for a total of $4 billion in local funding.
They hope to use these local dollars to leverage $2 billion in future FTA New Starts funding. MTA LIRR has previously provided billions in over match to cover billions in cost overruns for East Side Access.
Any FTA Full Funding Grant Agreement requires the recipient to be legally responsible for any additional costs above the agreed upon FFGA project cost.
Previous governors found billions in real local dollars to provide real skin in the game today, not over decades. Why can’t current governors Phil Murphy of New Jersey and Andrew Cuomo of New York do the same today?
It is up to Cuomo and Murphy with the assistance of Port Authority of NY and NJ to come up with $7 billion each toward their local share to progress beyond the $1.6 billion Portal Bridge and fully fund all nine phases of the overall $29 billion Gateway Tunnel.
Time to stop crying poverty and man up.
Without real hard financial resources from Washington ($14.6 billion), NJ ($7.3 billion) and NY ($7.3 billion), how will the full $29 billion Gateway Tunnel be paid for?
A project can’t be financed by borrowing and fare surcharges alone. Washington, Albany and Trenton all share equal blame for the lack of a real $29 billion Gateway Tunnel financing package.
Larry Penner
Great Neck
(Larry Penner is a transportation historian, advocate and writer who previously worked 31 years for the U.S. Department of Transportation Federal Transit Administration Region 2 NY Office.)
