Gateway Tunnel Project Start Delayed One Year

Real Estate In-Depth | September 2020

The North River Tunnel under the Hudson River connects New York and New Jersey and carries Amtrak & NJ TRANSIT passengers making 200,000 daily trips.

NEWARK—Considered one of the most important infrastructure projects in the New York metro region, the start of construction of the long-delayed Hudson Tunnel project has been pushed back by one year.

The Gateway Program Development Corporation released an updated financial plan for the project on Friday. GPDC in its plan noted that the projected start of major construction would be pushed back from early 2021 to early 2022. The project sponsor also stated that the construction cost for the project, due to the delay, has increased by $275 million, which pushed the overall cost of the project to $11.6 billion. The project entails $9.8 billion for the construction of the new tunnel and $1.8 billion for the rehabilitation of the existing tunnel.

The project includes the construction of a new two-track rail tunnel beneath the Hudson River, the comprehensive rehabilitation of the existing 109-year-old North River Tunnel that was damaged by Hurricane Sandy, and the completion of the third and final section of the Hudson Yards Concrete Casing.

The 2020 financial plan includes a continued local share construction cost commitment of $5.55 billion from the State of New York, State of New Jersey, and the Port Authority of New York & New Jersey. The updated financial plan also includes a continued Amtrak commitment of nearly $1.3 billion.

Major construction cannot begin on the tunnel project until a Final Environmental Impact Statement and a Record of Decision for the new tunnel and rehabilitation of the existing North River Tunnel are issued.

Steven M. Cohen, New York Trustee and chair of the Gateway Program Development Corporation, said: “All of our partners, the two states, the Port Authority, and Amtrak, remain fully committed to getting a new Hudson Tunnel built and rehabilitating the existing nearly 110-year-old tubes. Together, their funding commitments more than qualify the Project for an improved financial plan rating from FTA. Now we need a Federal Administration that works with us.”

He added, “With the COVID pandemic, the project has only taken on even more urgency as the nation looks to bring back jobs and stimulate the economy, essential workers need reliable transportation in the short term, and the region and nation need 21st century rail transportation to build better infrastructure for the long term.”

The revised upward project cost released in the updated financial plan reversed last year’s reduction in the estimated construction cost from $12.7 billion to $11.3 billion included in the 2019 Financial Plan

The GPDC is requesting $5.5 billion from the FTA’s CIG Program, which continues to be more than $1 billion less than the request in the 2018 Financial Plan. The 2020 request represents 44.3% of the total project, which also continues to be a reduction from the 49.4% previously sought in the 2018 Financial Plan.

In addition to the project providing long-term resiliency, reliability, and redundancy to the regional and national rail network, it will add more than 72,000 direct jobs and $19 billion in economic activity, including an average of $85 million per month in direct spending on materials and labor.

The Gateway Program focuses on a 10-mile segment of the NEC, and includes a program of projects that would replace and update rail infrastructure assets that, in many cases, are over 100 years old, as well as increase track, tunnel, bridge and station capacity. This segment of the NEC carries more than 200,000 daily Amtrak and NJ TRANSIT passenger trips on approximately 450 trains.

The Gateway Program’s first phase includes the construction of a new tunnel under the Hudson River, the rehabilitation of the existing tunnel, the completion of a concrete casing on the West Side of Manhattan to preserve right-of-way for the future tunnel to PSNY and the estimated $1.8-billion replacement of the Portal Bridge.

Later phases of the Gateway Program would include the replacement of the Sawtooth Bridges on the NEC located between Newark Penn Station and Secaucus Junction, the expansion of PSNY in Manhattan, the expansion and modification of Secaucus Junction Station and addition of loop tracks (“Bergen/Secaucus Loop”) in New Jersey, the construction of Portal South Bridge, and other elements to complete a modernized, four-track railroad from Newark Penn Station to PSNY.