Tag Archive for newjersey

Tunnel Rats

Yesterday, none other than the New York Times editorial board got on the train to urge the construction of new rail tunnels under the Hudson to alleviate the strain on the existing tunnels, which are around 100 years old and in dire need of replacement, or augmentation, or both. It’s about time.

Readers of Naked Urbanism already know the back story: how Chris Christie torpedoed the ARC project back in 2010 that would have addressed this now urgent situation. No matter what he said at the time, he was angling to be President, and used this issue to vault onto the national stage, playing as he was to the national Republican Party to burnish his credentials as a slash-and-burn rock ribbed conservative, the needs of his constituents be damned.

Clearly, the New York metro area contributes much more to the national economy than its size would suggest, and Republican politicians across the country would ever admit. But it’s true. We have more high-value, high income jobs here per capita than anywhere else, save perhaps the Bay Area/Silicon Valley, and I would suggest that our distribution is more diverse than theirs. So this is arguably both a local and a Federal matter.

Now that Christie’s performance to date in the Republican circus makes clear that his Presidential aspirations were far-fetched at best, and delusional at worst, it’s time to get back to reality and face the music. But how to pay for this?

Let’s start with how the ARC, a $10 billion project, was to be financed. The Federal government committed to 51% of the cost. The balance was to come from New Jersey Transit, the state of New Jersey (until Christie pulled the plug), and the Port Authority.

So if the Feds were ready to step up for 51% a few years back, there is no obvious reason why they wouldn’t do at least that much again. The revised estimate is now $20 billion, so there should be $10 billion right there. New Jersey will benefit tremendously from this project once it is done, and so should step up, too, for big money: According to a study done by the Regional Plan Association for the ARC, New Jersey can expect to see another $375 million in new tax revenue. If New Jersey contributed even a portion of that windfall, say $200 million, which would be recurring income, mind you, that would cover the debt service on nearly $4 billion in public finance at 5%. That would get us to $14 billion. New Jersey Transit should also take a piece, as should New York State, since New York will benefit from is a precedent to financing projects like this. At least on the back of the envelope, this job can be paid for, and we should start it immediately.

Chris Christie ceded the leadership on this one five years ago as he prepared for his quixotic quest on the backs of his constituents. Senators Menendez and Booker from New Jersey seem to absent on this one, Menendez possibly distracted by his indictment last April, and Booker likely wearing out his thumbs tweeting. So Chuck Schumer has rightly taken the lead here; the spectacle of spanking a deserving Republican a mere side benefit to this important project.

Christie on the Hudson?

Ignore his fanboy antics in fat-cat NFL skyboxes and blowing $12MM to $25MM of public money to run a special election three weeks before his own re-election to keep Cory Booker off the same ballot. Even set aside Bridgegate for the moment.

If not for Chris Christie, we would be five years into the construction of new rail tunnels under the Hudson River today. And the region, especially New Jersey, would be better off.

Earlier this week, equipment problems in the Hudson River tunnels caused severe disruptions of service and extensive delays for New Jersey commuters trying to get to their jobs in Manhattan. The delays were so bad that Anthony Foxx, the U. S. Secretary of Transportation, contacted Andrew Cuomo and Chris Christie, the governors of New York and New Jersey respectively, to stress the urgency of building new tunnel connections between Manhattan and New Jersey (also known as the U.S. mainland).

Problem is Christie torpedoed this project back in 2010 when it was called the Access to the Region’s Core (ARC). At the time, he loudly proclaimed his fiscal responsibility and determination not to stick the citizens of New Jersey with what he called “an open ended letter of credit” for cost overruns.  Never mind that the Government Accounting Office found that claim to be grossly incorrect.

It was just the thing to do to attract the favorable attention of the national Republican Party, also known as the “let’s shrink government at all costs, wreck the country in the name of ideological purity, and line our donors’ pockets Party”, and leap onto the national stage as a leading contender for President in 2016.

When Christie scuttled the ARC, he deprived New Jersey homeowners of an estimated $18 billion (yes, BILLION) in property value appreciation. That is wealth that would have also translated into an estimated $375 million in new municipal New Jersey tax revenues annually, according to a study done by the Regional Plan Association. Travel times would have been drastically shortened for at least half of those who commute from New Jersey to New York by rail. The project would also have created relatively long-term construction jobs, most of which would likely have been union jobs, known for solid wages and good benefits. Making it easier to get to New York would also likely have provided new economic opportunities for New Jersey residents in New York, especially significant since the median wage in New York is 60% (yes, sixty percent) higher in New York than it is in New Jersey.

It’s a lot to give up, unless you’re considering a run for the Presidency and you can trumpet your slash-and-burn approach to governing to the national Republican Party, break out onto the national stage, move several rungs up the ladder of presidential contenders, and get invited to give the keynote speech at the convention (where, incidentally you can mention yourself more than 7 times as often as the real nominee, whose name you don’t even utter until more than 16 minutes into your speech).

Add to that the benefits to you as a sitting governor. Take the $4 billion earmarked for the ARC, put it into the state Transportation Trust Fund (nearly insolvent at the time) and skip raising the state tax on gasoline.  If, along the way, you have to reimburse the Federal government $95 million for sunk costs, it’s a small price to pay, with, of course, public money.

Pretty compelling stuff provided that your own ambition comes before the interests of your constituents.

All that said ARC (now called Gateway) is back in the news. If anything, the benefits are greater than they were, and it is a must-do project for the region. While there are reasonable discussions to be had about how it should be financed, the sooner we resolve them and get started, the better for all of us.