Christie Again Kills Hudson River Rail Tunnel

After a two-week review period, Gov. Chris Christie has again killed the multi-billion dollar Hudson River tunnel project citing estimated cost overruns and an inability to reach an agreement with federal officials on how to pay for the tunnel, his office said in a statement Wednesday.

Federal cost estimates for the tunnel range from $9.8 billion to $12.7 billion, the governor's office said.

The tunnel would have given Bergen and Passaic County rail commuters a one-seat ride to Manhattan, cutting most commutes in Bergen County by 20 minutes and raising property values by as much as $60,000 in areas near a train station, transit advocates said. Christie, however, said he would not leave taxpayers on the hook for the projected $2.3 to $5.3 billion in overruns. The state is currently on the hook for $2.7 billion plus overruns.

Christie, in a press conference on Wednesday, said the federal government would only agree to pick up $378 million in cost overruns, though four plans submitted by the Department of Transportation were designed to mitigate the financial issues the 15-year project has run into.

To the governor, $378 just wasn't good enough to make up for what he said could be an uncontrollable cost. The four plans proposed to reduce the scope of the work by removing risk, borrowing from federal programs, reducing the scale of the project. One would remove the state's risk entirely as a public/private partnership with a company vying for the grants as opposed to the state. Another plan included the federal government, the Port Authority and the state of New Jersey all adding $358 million to cover cost overruns.

However, Christie said reduced plans would only "reduce the utility for those who would use it [the tunnel]."

"In the end, my decision does not change," Christie said. "I cannot place upon the citizens of New Jersey an open-ended letter of credit, and that's what this project represents."

U.S. Transportation Secretary Ray LaHood said he is "extremely disappointed" in Governor Christie's decision to abandon the ARC tunnel project.

The project, LaHood said, "is a devastating blow to thousands of workers, millions of commuters and the state's economic future. The governor's decision to stop work on this project means commuters – who would have saved 45 minutes each day thanks to the ARC tunnel – will instead see no end to traffic congestion and ever-longer wait times on train platforms."

"Our DOT team has worked hard over the last several weeks to present Governor Christie with workable solutions to bring the ARC tunnel to life," and LaHood thanked New Jersey Democratic Senators Lautenberg and Menendez for their efforts in lobbying for the project.

The governor first killed the project Oct. 8 prompting an onslaught of criticism from transit advocates and elected officials.  The governor agreed to take a second look at the project after a meeting with U.S. Department of Transportation Secretary Ray LaHood.  The federal government and Port Authority of New York and New Jersey had each allocated $3 billion for the tunnel, which would be America's largest public works project.

The project, which would cut 20 minutes off a commute from Ridgewood by adding another tunnel, was first proposed over 15 years ago as a way for commuters to have easier, faster access into the city. Residents along the largest train station on the Bergen/Main Line, Ridgewood, have had mixed feelings – some say Christie is being shortsighted, as a project of this magnitude could employee thousands of people, and increase property values as well as quality of life with a shorter, easier commute.

Others say the governor made the right decision – you can't write a check you can't cash. Councilman Paul Aronsohn, however, said the benefits of the project could have been tremendous to Ridgewood.

"Without question, the ARC tunnel is an important investment in our future – one that would benefit Ridgewood commuters and homeowners alike. From an economic, environmental and quality of life perspective, the case for the tunnel is very strong."

Democrats and transit advocates say the state is likely to lose the $3 billion already invested in the tunnel and are to return the $350 million it borrowed to begin construction, which began last year. An AP report says the state of New York is likely to put a claim on the $3 billion the federal government had granted to the Port Authority for this project; New York would likely use those funds to make progress on the Second Avenue Subway Project, which has also run into cost issues itself.