In a joint statement by New York Governor Andrew Cuomo and New Jersey Governor Chris Christie last week, both states pledged a combined total of $5 billion towards $12.7 billion Gateway Hudson Tunnel Project. The announcement fulfills a promise that half of the project be funded at the state level and half at the federal level, but the Trump administration has called the proposal “entirely unserious.”
The Hudson tunnel has been contentious for years. Only one rail tunnel currently runs under the Hudson River and between New York and New Jersey, and lingering damage from Hurricane Sandy threatens to close one of the two train tubes. According to Amtrak, which owns the rail tunnel, 200,000 riders pass through daily and closing just one of the tubes for necessary repairs would reduce train traffic between New York City and cities to the west by 75 percent.
An earlier, $8.7 billion iteration of the proposed Gateway tunnel would have doubled train traffic between New York and New Jersey, but was canceled by Governor Christie in 2010 over rising costs. The tunnel is also only one part of the larger, $24 billion Gateway Plan that, if fully realized, would expand Penn Station and build new bridges to connect Newark, New Jersey, and New York City.
Now that the New Jersey governor is on his way out, Christie seems to have no qualms about recommitting to the now more expensive version of the project. New Jersey has pledged $1.9 billion in funding, with New York agreeing to contribute $1.75 billion, both financed through a 35-year, fixed-interest loan from the Department of Transportation’s Railroad Rehabilitation and Improvement Financing program. Under the agreement, the Port Authority of New York and New Jersey would also contribute $1.9 billion through a similar loan.
Despite both states offering to take loans and pay them back with interest, a common method of financing for large infrastructure projects, the Trump administration has refused to accept this deal.
While the Obama administration viewed Gateway as an important part of modernizing transit infrastructure in an area that’s vital to the American economy, the current administration has relegated it to a local project. As the Department of Transportation (DOT) spokeswoman told Crain’s, “The plan now seeks 100% of its funding from federal sources.”
“No actual local funds are committed up front. They propose the project is funded half in grants and half in loans. This is not a serious plan at all.”
It remains to be seen how the DOT’s shift in attitude will affect similar transit projects nationwide, or how the $1 trillion infrastructure bill proposed by President Trump will impact the Hudson tunnel. Unlike the traditional 50/50 funding model used in the past, Trump’s bill would be funded through public-private partnerships.