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Gateway Development Corp to lead trans-Hudson tunnel project

13 Nov 2015

USA: Officials from the states of New York and New Jersey announced on November 12 that a governance model has been agreed to take forward plans for an additional rail tunnel beneath the Hudson river between Newark and New York.

A four-party entity known as the Gateway Development Corp would manage the construction of the tunnel plus associated works, including replacement of a bridge over the Hackensack river in New Jersey and redevelopment of New York Penn station to cater for additional trains using the Northeast Corridor. GDC would be established as a subsidiary of the Port Authority of New York & New Jersey, but its management board would comprise representatives of both states, the federal Department of Transportation and Amtrak.

The federal government has provisionally agreed to provide up to 50% of the estimated $15bn to $20bn cost of the Gateway programme, with the two states pledging to fund the rest, but an overall funding model has yet to be finalised. One potential new source of funding could be the revenues from Amtrak’s NEC services, profits from which are currently used to cross-subsidise loss-making long-distance passenger trains. Legislation now being considered by Congress would allow any operating profit Amtrak makes from its NEC service to be reinvested in infrastructure enhancements on the Washington DC – Boston route.

Capacity constraints on Amtrak and NJ Transit trains have grown over recent years, as all trains between Newark and New York Penn must use a single twin-bore tunnel under the Hudson river. These concerns have been exacerbated since the tunnel was flooded during Superstorm Sandy in 2012, which has led Amtrak to suggest that the tunnels may need to be closed within the next 20 years. Previous plans to build a trans-Hudson tunnel under the ARC programme were abandoned in 2010 after New Jersey Governor Chris Christie raised concerns about cost overruns.

‘Everyone knew it was important, everyone said it was important, but nobody was coming up with the funding’, New York state Governor Andrew Cuomo told local media on November 12. ‘And I think our pledge at 50% was heard by the President, by the Department of Transportation and we said, “Let's stop talking and let's start digging because we have start replacing the tunnels.”’