Sen. Charles Schumer’s recent announcement outlining his plans for progressing the proposed new Gateway Trans Hudson River tunnel is not worth the paper the press release was written on.
The Gateway Development Corporation, which was proposed earlier this year, is still several months away from becoming a legal entity.
Management of this project on an interim basis by a simple Memorandum of Understanding between New York, New Jersey, the U.S. Department of Transportation and New Jersey Transit may go on for many more months perhaps beyond 2016.
Just how will the future Gateway Development Corporation manage to finance the proposed $24 billion new Hudson River Tunnel?
The tunnel would connect New Jersey with Penn Station.
Moody’s Investor Services has questioned the ability of New Jersey to come up with its $6 billion share of the project cost. Others question how New York can find $6 billion for its share as well.
Interesting to note that the Metropolitan Transportation Authority is not a party to this Memorandum of Understanding. MTA Metro North ongoing West of Hudson Regional Transit Access Study is looking at this and other potential new services for Rockland and Orange County residents into New York City.
Finding $70 million between Amtrak and the PA of NY and NJ to begin preliminary engineering is a drop in the bucket.
Preliminary engineering followed by completion of final design and engineering up to 100 percent can average between 5 percent and sometimes even closer to 10 percent of a total project cost. You may need between $1.4 to $2.8 billion just for this task alone!
Promises by U.S. DOT to “commit resources and accelerate environmental reviews”is difficult. The Gateway Tunnel staff and consultants have to prepare detailed documents in conformance with the National Environmental Protect Act.
At a minimum, the U.S. DOT will require a full blown Environmental Impact Statement.
Based upon past history for other far smaller U.S. DOT Federal Transit Administration New Starts projects, this process alone easily averages several years.
Too many transit agencies come before U.S. DOT FTA asking to expedite the environmental review process for their respective projects. “Fast Tracking” is rapidly becoming a cliche in the transit industry.
Schumer is hoping that actual construction can begin by 2018. This is unrealistic.
The environmental review process would have to be completed resulting in a finding from the U.S. DOT. Then you would need completion of design and engineering, a Full Funding Grant Agreement from U.S. DOT FTA for New Starts funding, secure up to $24 billion and complete the procurement process for construction contractors.
Don’t forget resolution of any real estate issues including obtainment of easements, relocation of businesses or acquisition of property.
Past history for progression of the ill fated Access to the Regions Core along with Second Avenue Subway and LIRR East Side Access to Grand Central Terminal reveals that far more time will be required.
U.S. DOT “Buy America” requirements will play a role to both speed up this project and contain cost growth.
Is U.S. DOT in a position to waive any of these requirements?
Anyone in the transit industry knows that compliance with federal Buy America frequently adds both time and cost to a project. You can count on one hand the number of Buy America waivers issued by U.S. DOT to transit agencies in recent years.
U.S. DOT Secretary Fox, senators Booker and Schumer ($10 billion – now $12 billion), governors Cuomo ($5 billion – now $6 billion) and Christie ($5 billion – now $6 billion) all fail to identify the specific source for their financial contributions to the project.
There are no significant dollars programmed in the new Fixing America’s Surface Transportation Act (FAST ACT) for Gateway.
This legislation now affords rail along with mass transit eligibility for US. DOT FTA New Starts funding. The largest FTA New Starts FFGA was $2.6 billion for MTA LIRR Eastside Access to Grand Central Terminal.
Federal Railroad Administration Financing Loans have never exceeded $1 billion.
Language contained within the FAST Act affording Amtrak the ability to use some of the $200 million to $400 million in operating surplus profit it makes on the Northeast Corridor toward the new Hudson River Tunnel is not assured.
This needs future approval by Congress.
Amtrak still needs billions to fully implement real High Speed Rail on the Northeast Corridor between Washington and Boston. This doesn’t include routine state of good repair, safety, fleet equipment replacement and upgrades to bridges, stations and the East River Tunnels.
Even if Amtrak programmed $200 million of $400 million toward the Gateway Tunnel, it would take 60 years to come up with the $12 billion federal share for the project!
The New Jersey Transportation Trust Fund is insolvent.
Just like the MTA and Amtrak, NJ Transit needs billions more in coming years, just to reach a state of good repair.
Larry Penner
Great Neck
(Larry Penner is a transportation historian and advocate who previously worked in the transportation field for 31 years).
