The death of a rail-tunnel project, and the problem with relying on Trenton

Rendering of a new 34th Street concourse, part of the plan. ()
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Eliot Brown

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Last summer, New Jersey Governor Jon Corzine and federal transportation czar Peter Rogoff and about a million other politicians gathered outside a factory in North Bergen, N.J. to break ground (ceremonially) on one of the most ambitious transportation megaprojects the region has seen in decades.

Named "Access to the Region's Core," or A.R.C., the project would build a new tunnel under the Hudson River connecting New York City and northern New Jersey, allowing 80,000 new riders to gush into Manhattan every day to work in its offices. Lots of new train service to north Jersey suburbs would offer a one-seat ride to Manhattan-bound commuters in places like Passaic, Paterson, North Hackensack and Teterboro, increasing property values in these towns by a total of $18 billion, according to a study by the Regional Plan Association. New planned office towers in Manhattan, like the massive new office building Steve Roth's Vornado Realty Trust wants to build right next to Penn Station, and buildings planned for a platform above the West Side Railyards, would be injected with adrenaline in a sagging economy. Commuters would get a less crowded ride, and ever-growing Amtrak could fit more trains (for a few years) into at-capacity Penn Station. All at a cost of about $8.7 billion.

But despite a recent denial from New Jersey Transportation Commissioner James Simpson, advocates of the project and some state officials are telling the press that Corzine's Republican successor, Chris Christie, plans to put the project on the shelf in order to free money up to deal with his state's crippling debt. Just yesterday, the Democrat-led state legislature was forced to approve a $1.4 billion transportation bond issue only after the governor shut down all work on infrastructure and transportation projects throughout the state.

Advocates for the project say that the plug could be pulled on the A.R.C. project sometime this month.

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The death of the project, if it comes, is one more demonstration of the problems that plague multi-state regional planning efforts. Here, as with countless other projects requiring the cooperation of New York and New Jersey governments, one state takes possession of a project to simplify the arcane funding process that plagues them. And the scale of the projects usually means that they reap the majority of their benefits in the long term—often with elected officials responsible for marshaling the projects finding their fates tied to more short-term concerns like the fiscal security of their voters. Ferrying along a project you didn't break ground on and probably won't get to cut the ribbon on, what's the motivation?

The funding structure and the politicians on both sides of the Hudson River typecast A.R.C. as a New Jersey project, despite the the way the influx of northern New Jersey workers could transform New York City's economy, making the city that much more desirable a place for large firms to set up shop. That means better prospects for real-estate developers, and an expanded tax base for New York City.

But despite the city's massive stake in the project, New York has been without a vote, and at the mercy of Trenton politics.

A BIT OF BACKGROUND: A.R.C. WAS CONCEIVED OF DECADES AGO, to be a new tunnel to complement the existing 100-year-old rail tunnels that lie under the Hudson River to midtown. With the suburbs of northern New Jersey growing, and with Penn Station and the existing tubes under the Hudson already at capacity during rush hour, planners turned to a new set of tunnels to expand capacity, calling for a new station to be built under 34th Street.

The Corzine administration championed the project for years, scrounging up the money from an already fiscally troubled state to make it happen. It raised $2.7 billion from state sources and directed another $3 billion from the New York/New Jersey-controlled Port Authority (which explicitly devoted a corresponding $2 billion to a New York project), and the federal government kicked in another $3 billion. By mid-2009, a groundbreaking, miraculously, had actually begun; contracts were awarded, and the region readied for its new tunnels.

When Christie first arrived, he seemed fine with ARC, letting the project continue despite dealing with a budget deficit more than one-fourth the size of the budget.

But in recent weeks, the federal government came back with new estimates of a higher cost for the project (Christie has said they could be between $2 billion and $5 billion), and the governor last month announced a 30-day review to weigh his options. Nearing his self-imposed deadline, the speculation is rampant that the governor will pull the plug completely, likely putting some of the money into the state’s broke Highway Trust Fund to fill the ever-increasing number of potholes that form when there is no money to fill them.

Christie has plenty of political cover here—he was elected as a corrective to years of Democratic budgetary excess, and has been lionized in New Jersey so far for loudly sticking it to anything perceived as bloat and special interests. Perhaps not surprisingly, there have been few cries of outrage from New Jersey over the reports that Christie is going to sink, or at least halt spending on, the tunnel. The project may be the region’s largest, and perhaps most impactful, transit initiative, but the payoff, to most voters, is both abstract and long-term. (This political situation also comes about in part because there is a split among rail advocates about the project, with many feeling A.R.C. is too much of a compromise plan to merit their support, a point that has some validity given that it does not connect to the existing Amtrak and NJ Transit lines in Manhattan).

Still, compared to the inevitable cacophony of resistance that would greet anyone who would try to scale back a major transit project on this side of the Hudson (In a time of fiscal crisis, the MTA is plodding away with over-budget $8 billion East Side Access, the Second Ave Subway and the $1.3 billion Fulton Street Transit Center, which adds no new capacity), the silence is notable.

Further, Christie had no great incentive to push for something that was not going to be his legacy project: He was not at that North Bergen groundbreaking, and, with a ribbon cutting targeted somewhere around 2018, he would not be there for the completion.

And the consituents in New York that would benefit from the project are not among Christie's voters; their own New York politicians are in no place to criticize, given that they have not put up money of their own.

If Christie pulls the plug, the best advocates for the project could hope for is a delay. But its rare for the existing funding on a project to remain intact through years of such delay. And that would probably be the end of A.R.C. With $600 million already spent on the project and the federal government having earmarked $3 billion to help with the costs, it's hard to imagine when the region will be able to round up that kind of money again, then redraft the plan, go through years of construction, and put a spade in the ground, for real this time.