New York, New Jersey devise plan to fund Gateway Tunnel project

It remains to be seen if the federal government will consider this plan

After many fits and starts, New York Governor Andrew Cuomo and outgoing New Jersey Governor Chris Christie have created a plan to come up with their share of funding for the Gateway Tunnel project.

In letters sent to the U.S. Department of Transportation, the two governors say that they plan on underwriting a portion of the project’s cost by relying on a loan from the DOT’s Railroad Rehabilitation and Improvement Financing Program, reports Crain’s. The two states would take out a 35-year, $1.75 billion loan, with New York paying it back using money from its budget.

New Jersey, meanwhile, would recoup the costs by imposing a surcharge on NJ Transit trips to Manhattan. According to the New York Post, that’ll mean an extra 90 cents on trips on the Trans-Hudson Line starting in 2020, with the charge going up to $1.70 in 2028 and $2.20 in 2038.

The Gateway project, which involves building a new train tunnel connecting the two states under the Hudson River, is projected to cost around $30 billion. A plan put forth by the Obama administration would have seen New York and New Jersey ponying up $15 billion of the project’s cost, with the federal government picking up the other half of the tab. However, once Donald Trump took office, the fate of the project became uncertain.

“New York State is stepping up to fund its share of the financial commitment as we rebuild our infrastructure all across the state,” said Governor Cuomo in a press release. “Now the federal government must fulfill its commitment to fund the other half and make this urgent, long-overdue project a reality.”

When contacted by Crain’s, a senior official from the Trump administration responded to the letters by calling the plan “entirely unserious.”

Source: FS – NYC Real Estate
New York, New Jersey devise plan to fund Gateway Tunnel project