Over the past 20 years, plans to dig a new train tunnel under the Hudson River – one of the most important and ambitious transportation projects in the country – have repeatedly met with political opposition.
So when the governors of New York and New Jersey agreed on Tuesday to split their share of the project’s $14 billion first phase — known as the Gateway — the announcement sparked a familiar note.
After all, two different governors have achieved similar agreement in 2015, when Chris Christie was CEO of New Jersey and Andrew M. Cuomo was still at the helm of Albany. To say that progress on the construction of the tunnels has been slow since then would be an overstatement.
While the actual tunneling is still at least over a year away, Tuesday’s announcement is an indication that the Gateway may finally be moving forward.
The project’s planners are racing to lock in federal funding while they have support from the Biden administration and Democratic leaders in Washington.
Before the federal government can agree to pay half or more of the cost, the two states must come to an understanding of local sharing. The states did not specify how they plan to pay their shares, but New Jersey has previously said it will raise part of its holdings by issuing bonds.
“This agreement is an important step forward for Gateway,” said Senator Charles Schumer, the Democratic majority leader. “I’ve told the governors of New York and New Jersey that unless they come to an agreement quickly, we won’t be able to buy federal funds for the first round of funding.”
Project Gateway seems to have moved rapidly toward federal funding before, under the Obama administration. But that momentum was lost when Donald J. Trump was elected in 2016. Mr. Trump refused to grant Gateway the necessary approvals and funding during his four years in office.
How to split the costs has been a source of problems in the past. Mr. Cuomo, a Democrat who resigned as governor last year after being accused of sexual harassment, resisted all obligations and famously declared: “It’s not my tunnel.”
He eventually reached an agreement with Christie, a Republican with a history of blocking a new trans-Hudson tunnel. In 2010, Mr. Christie construction pause of the previous version, called ARC tunneling.
Although all federal funding was in place, Mr. Christie abandoned the project, concerned about the potential for New Jersey to incur potentially large costs.
A complication in reaching cost-sharing arrangements is that the main users of the tunnels will be New Jersey residents who come to New York City for work. They ride in New Jersey Transit, where trains were packed before the pandemic. Transportation planners expect even more demand for Hudson travel in the coming decades. However, New Jersey Transit has carried fewer people in the past two years as more workers have left their offices.
Now, the governor of New Jersey, Philip D. Murphy, is working with Cuomo’s successor, Kathy Hochul. Both Democrats, they are both vocal supporters of Gateway.
The sprawling Gateway project also involves extending Pennsylvania Station in Manhattan and replacing an important New Jersey railroad bridge leading to the Hudson. Instead of waiting for the Gateway to get all the approvals it needs, Ms. Hochul has pushed for Penn Station, which she calls a “hell hole”, to be renovated before rather than after the Gateway is completed.
Hochul plans to have developers surround the station with super-tall towers in exchange for payments that will equate to an estimated $7 billion worth of renovation costs. That plan has been met with resistance from community leaders, who question whether there is enough demand for office space in Midtown to pay for the renovation.
The formal agreement, a memorandum of understanding, that governors signed Tuesday covers Gateway’s “Phase 1,” which includes the Portal North Bridge and the Hudson Tunnels. They agreed that the states would split the local costs equally among those parts of the project.
“The Gateway Hudson Tunnel project is vital to the Northeast Corridor, and today’s announcement is an important step in making this vision a reality,” said Ms. Hochul..
Murphy said the formal agreement “marks an important milestone towards the completion of the most important transportation project not only in New Jersey but in the entire United States.”
Construction of the bridge, which carries Northeast Corridor trains across the Hackensack River, is expected to begin this summer. The bridge, used by New Jersey Transit and Amtrak, is expected to be worth about $1.9 billion, and governors say the federal government will pay about 60 percent of that total.
They say each state will spend $386.2 million on the bridge. The memo states that New Jersey will be responsible for cost overruns caused by delays and inflated construction costs.
