Proponents of a new rail tunnel beneath the Hudson River from northern New Jersey to New York City are hopeful that a slimmed-down budget estimate will make the project more appealing to the Trump Administration, and end a three-year-old federal funding stalemate.
An updated financial plan submitted to the Federal Transit Administration on Aug. 23 by the Port Authority of New York and New Jersey, lead sponsor for the Gateway Tunnel Project, reveals $1.4 billion worth of design and construction savings. The new version trims the planned tunnel’s estimated overall cost by nearly 13%, to $9.5 billion.
The estimate to rehabilite the existing 108-year old tube increases to $1.8 billion—a $200-million hike that officials attribute to normal price escalation resulting from that project starting after the new tunnel is completed.
Soon after taking office in 2017, President Trump scrapped an Obama administration proposal to split the new tunnel’s original $11-billion cost with New York and New Jersey. The states have also been stymied in their efforts to secure nearly $7 billion in federal capital improvement grants.
Project officials now say steps to refine the project’s scope and reduce uncertainties can help get construction underway as early as February 2021, assuming federal permits are issued by the end of this year.
Advancing the design to the 30% stage for a required Federal Railroad Administration review, for example, streamlines the contracting process and opens the door to using design-build for boring the tunnel and constructing its concrete shell. Project officials add that a planned application for an “early systems work agreement” would also allow boring work to begin before a full federal funding agreement is finalized.
By lowering the project’s estimated costs, New York and New Jersey have also cut their federal capital grant request to $5.4 billion. The states have reaffirmed their commitment to provide $5.5 billion for both new construction and rehabilitation work, and have established a bi-state project oversight commission.
Project co-sponsor Amtrak would increase its contribution from $704 million to nearly $1.3 billion.
When and how federal officials will respond to the new proposal is unknown.
Jerry Zaro, a New Jersey-based real estate attorney who is chairman and one of three trustees of Gateway Development Corp., said in a statement that everything is being done to demonstrate a full commitment to the project.
“We need the federal administration in Washington to start to recognize those efforts and meet us halfway,” Zaro added.
