Tunnelvision

From The Trentonian:

TRENTON — Hamilton native and Port Authority of New York and New Jersey bigwig Bill Baroni, whose bistate agency pledged to pump $3 billion into an ambitious train tunnel project, refused to comment Thursday after Gov. Chris Christie killed the plan.

Baroni deferred to his Port Authority press flack, Ron Marsico, who also refused to comment on Christie’s sweeping action to pull the plug on a decades-in-the-making train tunnel connecting New Jersey and Manhattan.

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The tunnel, which is already under construction, started at $5 billion in 2005, grew to $8.7 billion by 2008 and now stands at an estimated cost of somewhere between $11 billion to $14 billion, according to Christie, who said that ever-increasing pricetag is the reason why he scrapped the project.

In addition to the $3 billion that the Port Authority pledged, the tunnel would have also been funded by $2.7 billion from the state of New Jersey and an additional $3 billion from Uncle Sam.

The Port Authority isn’t a taxpayer-funded agency, but it gets the bulk of its revenue through tolls, fees and fares.

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Baroni is a former New Jersey state senator from Hamilton who accepted Christie’s request to become the Port Authority’s deputy executive director on March 1.

More than a half-billion dollars has been spent on the tunnel, and construction began last year. The largest federal transportation project in the country, it was expected to double train traffic in and out of New York City during peak commute times once completed in 2018.

But over the years, the estimated cost for the tunnel has more than doubled.

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A month ago, the Republican governor ordered a 30-day halt to all work on the tunnel over concerns that it would go over budget.

U.S. Transportation Secretary Ray LaHood’s spokeswoman indicated the project might not be dead. Olivia Alair said in an e-mailed statement that LaHood and Christie plan to meet Friday afternoon to “discuss a path forward on the ARC tunnel project.”

Proponents of the tunnel — dubbed Access to the Region’s Core, or ARC — assailed the Republican governor’s decision as shortsighted and wrong-headed.

“This devastating blow will hurt our state and its economy for generations to come,” said Assemblyman John Wisniewski, chairman of the state Democratic organization.

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The independent Regional Plan Association said Christie was using fuzzy math.

“Gov. Christie’s claim that he supports ARC but could not move forward because of budget overruns is most likely not true,” the group said in a statement. “The Federal Transit Administration (FTA) officially never released its estimates for potential budget overruns — only Gov. Christie estimates them to be in the $3 billion to $5 billion range. What’s more, Trenton has repeatedly rebuffed federal officials’ efforts to work out a cost overrun deal.”

The project had been in the works for about 20 years. Currently, NJ Transit and Amtrak share a century-old two-track tunnel beneath the Hudson River. The new tunnel would add two more tracks, more than doubling the number of NJ Transit trains that could pass under the river.

Mark Nardolillo, CEO of tunnel contractor BEM Systems in Chatham, said 10 to 15 employees he has working on it will lose their jobs.

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Commuters at New York’s Penn Station weren’t pleased to hear the project had been canceled.

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Christie’s predecessor, Democratic Gov. Jon Corzine, broke ground on the tunnel in June 2009, a few months before the gubernatorial election that he lost to Christie.

During his campaign last year, Christie supported the project.

But as soon as he announced the work stoppage, lawmakers and transportation officials suggested Christie had planned to scrap the project and to use the state’s share of the money to pay for the nearly broke Transportation Trust Fund, which pays for local road projects and rail repairs.

Christie has refused to raise the state’s gas tax, which is among the lowest in the country, to replenish the fund.

So far, about $600 million has been spent on the tunnel project. New Jersey could be on the hook to repay half of that to the federal government for breaking its commitment.

U.S. Sen. Frank Lautenberg, D-N.J., has said canceling the tunnel would violate an agreement with the feds in which New Jersey committed itself to the project in exchange for $3 billion in federal funding. He and other tunnel proponents planned to speak out on the governor’s decision later Thursday.

Officials have said the tunnel would create 6,000 construction jobs and add at least 40,000 new jobs after it is completed. If Christie were to divert money to the state transportation fund, that could also create jobs, depending on the projects.

From Asbury Park Press:

TRENTON — The nation’s largest public works project may yet be saved, after Gov. Chris Christie and U.S. Transportation Secretary Ray LaHood announced today they would appoint a group to look at options for the scuttled Hudson River rail tunnel.

Federal transportation and New Jersey Transit officials will examine options for the $8.7 billion rail tunnel to New York City before reporting to Christie in two weeks.

The announcement came after LaHood drove from Washington to meet with Christie for roughly 90 minutes this afternoon, one day after Christie declared he was canceling the project because up to $5 billion in potential cost overruns that would have to be borne by New Jersey.

Christie faced a hail of protest from Democrats, transportation advocates, and even liberal economist Paul Krugman, a Nobel Prize winner, who said in his New York Times column the decision was “destructive and incredibly foolish” and “a perfect symbol of how America has lost its way.”

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Sean Maher, an economist with Moody’s Economy.com, called Christie’s decision disappointing. He said that although the tunnel does pose a short-term problem for state finances, he estimated a new tunnel would have added $25 billion in new wages to the region’s economy.

The cancellation, if realized, will “affect everything from population growth to local services and property values,” Maher said. “Over the long term, the cost of this project is nothing to the potential benefit.”

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U.S. Sen. Frank Lautenberg, a Democrat, said today at Penn Station in Newark that the project is “on a respirator.”

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Lautenberg said he did not believe the federal government would offer more money for the tunnel, and he said that he called New York City Mayor Michael Bloomberg to find out if the city can add funds to the deal, which was to be financed by New Jersey, the Port Authority of New York and New Jersey, and the federal government.

The $5 billion in potential cost overruns are “informal opinions, and (the overall project cost) will be significantly less than the $10 billion to $15 billion the governor quoted,” Lautenberg said.

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Martin E. Robins, who used to head a transportation think tank at Rutgers University, said the cost overruns are estimates based on possible problems, such as rock slides, unexpected deaths, collapses and other “worst-case scenarios.”

“This is a debate among engineers about what conceivably could happen,” Robins said.