New York Gets ‘Historic’ $12B in Federal Funds for Tunnel Project

July 08, 2024 — New York, NY — Governor Hochul joins State and Federal officials in Manhattan to make a transportation and infrastructure announcement (Don Pollard/Office of Governor Kathy Hochul)

(The Center Square) — New York is getting $12 billion in federal funding to help build a long-delayed second tunnel beneath the Hudson River in what officials are touting as the largest rail construction grant in U.S. history.

The Gateway Development Commission announced on Monday that it had signed full funding with the Federal Transit Administration for $6.88 billion in federal funding for the Hudson Tunnel Project and closed on federal infrastructure loans from the Build America Bureau for $4.06 billion to fund the local share of the $16.6 billion project.

Members of the commission, created to lead infrastructure projects between New York and New Jersey along the Northeast Corridor rail line, touted it as the “largest federal funding commitment to a rail transportation project in modern history.”

New York Gov. Kathy Hochul said the funding “will provide the critical resources needed to deliver an essential piece of infrastructure that will bring millions of visitors to New York every year.”

Sen. Chuck Schumer, D-N.Y., said the massive project is “full speed ahead with billions from FTA ready to go and be used for critical work and construction” after “many false starts and obstacles” over the years.

“Gateway’s future is assured and the most important public works project in America is all systems go,” he said in a statement.

New Jersey Gov. Phil Murphy heralded the funding as a “significant milestone on the path to ensuring the success of our nation’s most vital infrastructure project.”

“As the main artery of our nation’s economy continues to be pushed to its limits, we are now one step closer to transforming the 100-year-old infrastructure under the Hudson River,” the governor said.

The project, years in the making, calls for renovating the 1910 tunnel, which carries about 200,000 weekday passengers on Amtrak and NJ Transit beneath the Hudson between New Jersey and Manhattan.

The renovations are expected to double the capacity of the Northeast Corridor train line between Newark and New York City — which state and federal officials say will improve rail mobility from Washington, D.C., to Boston and other destinations.

New York and New Jersey agreed last year to split the 30% local share of the cost of building the tunnel, a move that was required to apply for federal funding.

A portion of the funding will come from a $1.2 trillion federal infrastructure package signed into law by President Joe Biden in November 2021 after receiving bipartisan support in Congress. It will distribute about $550 billion of new federal spending over five years.

The Gateway Commission also expects to receive federal funding through the U.S. Department of Transportation’s Rebuilding American Infrastructure with Sustainability and Equity program and other federal grant programs.

Backers of the massive taxpayer-funded Hudson Tunnel project say the work will create 72,000 jobs and $19 billion in economic activity and demonstrates that the federal government can tackle massive projects during a critical time for transportation and mass transit.

They also say it will ease a bottleneck of rail traffic coming to and from the city, which could worsen if renovations aren’t completed.

“It is important to realize that as we improve New Jersey Transit and Amtrak service in and out of Manhattan, we will improve train and transit service for a region that impacts more than 20 percent of the nation’s economy,” FTA Acting Administrator Veronica Vanterpool said in a statement.

— Christian Wade, The Center Square contributor

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