A planned $12.7 billion billion project for a new dual-track rail tunnel linking New York City and New Jersey got the cold shoulder in President Trump’s $1.5 trillion infrastructure proposal, leaving the future of the nation’s busiest transit corridor in doubt.
Trump’s proposed budget unveiled Monday provides only $200 billion in direct federal spending for infrastructure in the next 10 years with state and local governments able to use the funds for up to 20% of an individual project’s cost.
This formula differs from a previous funding plan brokered by the Obama administration in 2015 where the federal government would pay for 50% of the Gateway Hudson Tunnel Project under a New Stars grant with New York and New Jersey covering the remaining half. The Port Authority of New York and New Jersey was tapped under the previous agreement to lead financing efforts for the large-scale initiative that impacts service on Amtrak and New Jersey Transit.
“The Gateway Program remains the most urgent infrastructure program in America and a project of national significance for which there is not a minute to lose,” John Porcari, interim head of the Gateway Development Corp. that is overseeing the project, said in a statement Monday. “In order for programs across the country like Gateway to be successful, we must substantially increase direct federal investment in infrastructure.”
The Trump infrastructure blueprint puts more weight on the shoulders of New York and New Jersey to shoulder the burden for Gateway. The states announced a combined $5.5 billion commitment for the Gateway project in mid-December under the previous Obama administration framework where New York would budget an annual budget appropriation over a 35-year period to pay debt service on a $1.75 billion fixed-interest loan under the U.S. Department of Transportation’s Railroad Rehabilitation & Improvement Financing program. The plan also involved N.J. Transit and the Port Authority each contributing $1.9 billion.
“I continue to be, on the one hand, underwhelmed by the infrastructure plan, which has a lot of good words associated with it, but not a lot of coin, specific to Gateway or more broadly,” said New Jersey Gov. Phil Murphy at a press event Monday.
Federal Transit Administration deputy administer K. Jane Williams sent a letter to New York and New Jersey officials in late December noting concerns about the Obama-administration financing plan calling the agreement “non-existent.” Senate Minority Leader Chuck Schumer, D-N.Y., said Monday that Trump’s infrastructure plan would “put unsustainable burdens on our local government and lead to Trump tolls all over the country.”
The existing tunnels linking New Jersey with Manhattan’s Penn Station are more than a century old and suffered severe damage from Hurricane Sandy in 2012, causing a five-day service shutdown. The Port Authority has previously estimated a $100 million daily cost to the nation in transportation-related impacts and productivity losses if the tunnels utilized by roughly 200,000 commuters were forced to shut down for just a 24-hour period.
“The Northeast Corridor is the economic powerhouse of the country, responsible for producing $3 trillion of the country's gross domestic product, and Gateway is a vital project to ensure that powerhouse continues to operate,” Nick Sifuentes, executive director of Tri-State Transportation Campaign, said in a statement. “Now it’s up to far more sensible heads in Congress, especially Congressional leaders from New York and New Jersey, to push for nothing less than the federal fair share of 50%.”