Release of the Federal Rail Road Administration draft Environmental Impact Statement for the Gateway Tunnel confirms continuing increases in total project cost.
The Gateway Tunnel would provide additional tracks for both Amtrak and New Jersey Transit connecting New Jersey to Penn Station.
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.
This news follows U.S. Department of Transportation withdraw from formal membership in the Gateway Development Corporation board.
President Trump’s proposed new budget confirms that there is no legal federal commitment to fund the Gateway Tunnel project.
The tunnel would connect New Jersey and Penn Station, providing both Amtrak and New Jersey Transit with additional access.
All the Department of Transportation provided to the Gateway Development Corporation in June 2016 was to grant permission to the Project Development Phase of the Federal Transit Administration New Starts Program. This is just the first step of a long multi year process.
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 & New Jersey allocation of $2.7 billion within the approved $32 billion 2017-2026 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.
Former Secretary of Transportation Fox, senators Booker, Menendez and Schumer ($14.6 billion), New York Gov. Cuomo ($7.3 billion) and New Jersey Gov. Christie ($7.3 billion), all for the most part, have failed to identify, approve and deliver the specific source(s) for their financial contributions to the project.
There are no significant dollars programmed in the federal Fixing America’s Surface Transportation Act (FAST) for Gateway. It is wishful thinking that the Federal Transit Administration New Starts program, Amtrak and Federal Rail Road Administration loans combined can come up with $14.6 billion or more for Washington’s share of this project.
The same is true for New Jersey’s $7.3 billion and New York’s $7.3 billion.
Many still question where the money will come from. There is no guarantee that Department of Transportation Secretary Elaine Chao will be able to deliver on her predecessor Fox’s promise of up to $4 billion in New Starts funding for the project.
The Gateway Development Corporation still now needs $26.4 billion more in real approved funding to finance the proposed $29.1 billion new Hudson River Tunnel.
Sen. Schumer believes that Amtrak will contribute 10 percent or $2.9 billion toward the $29.1 billion total project cost.
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 Metropolitan Transportation Authority, Amtrak, New Jersey Transit and Port Authority of New York & New Jersey 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
Great Neck
(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.)
