Hudson Tunnel Plan Shows Sign of Life as U.S. Speeds Review

(Bloomberg) -- The U.S. Transportation Department has committed to finishing an environmental review for a new Hudson River rail tunnel, after a three-year delay helped prevent the groundbreaking of one of the nation's most urgently needed infrastructure projects.

The evaluation of the new commuter link between New Jersey and New York City will be finished by May 28, according to an update to the federal government's online permitting dashboard. If the study is cleared, the $11.6 billion Gateway project could potentially qualify for partial federal funding.

Transportation Secretary Pete Buttigieg last month told lawmakers that the tunnel is among President Joe Biden's priorities. Biden on Wednesday introduced a $2 trillion infrastructure plan, fed by a tax increase on the wealthy, that he called a “once-in-a-generation investment in America.” The proposal calls for rebuilt bridges and highways, a shift to cleaner energy and boosts for mass transit.

New York and New Jersey have committed to footing the bill for 50% of Gateway, which includes a new tunnel plus the closing, rehabilitation and reopening of the 110-year-old link that serves Amtrak and New Jersey Transit commuter trains. President Donald Trump's administration precluded federal funding in part by delaying the environmental decision, which was due in March 2018.

An earlier tunnel project, called Access to the Region's Core, was fully funded and to be completed by 2018. But it was scrapped in 2010 by Chris Christie, New Jersey's Republican governor at the time. Christie, who cited issues with that project's cost and design, used some of the money that had been set aside to plug budget holes and avoid a gasoline-tax increase.

The new May 28 commitment from the federal government “is the latest demonstration of the Biden administration's clear resolve to expedite the project and start construction as soon as possible,” according to a statement by the Gateway Development Commission.

Gateway would ease a major Northeast U.S. rail bottleneck. Amtrak says the project will allow for twice as many trains to run under the Hudson River, including those that are part of its Northeast Corridor service that connects Boston, New York and Washington.

Before the pandemic, about 820,000 rail passengers a day traveled to New York City or some other destination in the U.S. Northeast. The project's sponsors have warned that a failure of Amtrak's only Hudson tunnel would cause economic harm to a region that is key to 20% of the nation's gross domestic product.

The two-track tunnel is safe, according to Amtrak, but its decaying electrical and other components, damaged by Hurricane Sandy in 2012, are increasingly unreliable. New Jersey Governor Phil Murphy and others have called the proposal the nation's most urgent infrastructure need.

Murphy, in a statement, called the new due date “a major step toward relief for New Jersey commuters.”

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