ARC Tunnel - Revisited (Again)

Editorialist in the [i]Newark Star-Ledger[/i] wrote:Plans for a new rail tunnel between New Jersey and Manhattan took a nasty PR hit in 2010, when Gov. Chris Christie pulled the plug on the ARC tunnel, citing billions in potential cost overruns to the state.

That concern was reasonable, if overblown. But he left billions of federal dollars on the table that we might not get back. And his real motive, it seems, was to grab the money set aside by Gov. Jon Corzine, so that he wouldn’t have to raise the gas tax.

One of the major problems Gateway faces is also financial. There is a major political movement in this country to HALT public works projects. The attitude is, "Is it being built with public money? If it is I'm against it." For instance-

On the block, potentially, is Amtrak’s Gateway project — which includes a new tunnel, rail lines and bridges from Newark to New York Penn Station. It will cost $15 billion, with a best-case completion date of 2025. Last year, federal funding for the Gateway project totaled $15 million for initial studies, less than a third of what was asked for. The outlook isn’t much better for 2013.

http://blog.nj.com/njv_editorial_page/2 ... o_new.html

Don31 wrote:

Ken W2KB wrote:
But the Port Authority is a state agency, owned by NY and NJ. So in effect half the overrun was coming from NJ taxpayers. The PA now has what it would have cost to expend on other projects that help NJ, such as the raising of the Bayonne Bridge to allow for large ships to utilize Port Newark.

Not taxpayers Ken. The Port Authority doesn't use taxpayer money, its funded entirely by bonds supported by toll revenue. Your point about freeing up money for other projects is a good one though.

however much of the tolls are paid by NJ tax payers / residents. the groups overlap more than a trivial amount. Bottom line is much of the money would have been paid by NJ taxpayers one way or the other. (and even the PANYNJ picking it up overruns still means much of the cost carried by NJ residents/taxpayers.)

My 2 cents is- of course it benefits NJ the most as it would have made our lives easier so we should pay a reasonable amount, next it benefits NY by helping keep labor costs down and allowing NJ residents to get to NY easier/cheaper to spend their money, but it also benefits the whole country for a plethora of reasons. So NJ taxpayers shouldn't pay a majority of the costs. NJ Transit being the lead and NJ taxpayers paying something more than a third wasn't unreasonable to me, but paying half or more isn't a fair shake.

Christie SHOULD have just given the feds a chance to come up with a fair financing plan if that was his real concern. Instead he rushed to cancel it- he could have easily "went all jersey" in the press about how it was unfair and the feds should pay more and he probably would have gotten significant concessions.

Much of the Port Authority's tolls are paid by out of state vehicles, especially at the George Washington Bridge (I-95 Trucks) and the Staten Island Crossings (New York State residents).

Also it's not like that money is not being spent, it is, it's been redirected to local NJ highway projects. Who's going to pay the cost overuns for those projects?

http://www.nj.com/news/index.ssf/2011/0 ... e_arc.html

michaelk wrote:
however much of the tolls are paid by NJ tax payers / residents. the groups overlap more than a trivial amount. Bottom line is much of the money would have been paid by NJ taxpayers one way or the other. (and even the PANYNJ picking it up overruns still means much of the cost carried by NJ residents/taxpayers.)

Tolls are paid by NJ taxpayers, true. But thats confusing the issue. The money is not NJ tax money, i.e., money from the NJ Treasury. Yes, tolls are paid by NJ taxpayers (NJ drivers), but its not coming from the state coffers. Tolls are also paid by NY drivers and out-of-state drivers as well. So if the PANYNJ picked up any overruns, the Port's bondholders, not the NJ state treasury, would be on the hook.

I'm surprised none of the ARC money went for the Portal Bridge project. If you want an example of a bridge that needs to be replaced ASAP there's one right there.

Subsequent to the Record of Decision (ROD) the project's scope was revisited in light of available funding and the termination of the neighboring Access to the Region's Core project. The Portal Bridge Capacity Enhancement Project currently involves the final engineering and design of a new two-track, fixed-span bridge across the Hackensack River between Secaucus and Kearny north of the existing bridge. Amtrak website

It sounds like Amtrak has tried to get some money diverted. Per their Portal Bridge Project website the project is in the final engineering stage and this should be completed early next year.

http://www.portalbridgenec.com/PE/pe.html

Will this new Bridge work in conjunction with the old Portal Bridge or will it replace it? It has been so confusing trying to keep up with how they're handing this. First, ARC had two completely new un-movable high level bridges. Then, the Gateway project scaled it down. Now, I have no idea. Is this new two-track portal a replacement for Portal or a complement for Portal. Also, is this part of the Gateway Project? Or is it just "patching the hole with ducktape" until Gateway gets fully built out when we're all six feet under?

Don31 wrote:

michaelk wrote:
however much of the tolls are paid by NJ tax payers / residents. the groups overlap more than a trivial amount. Bottom line is much of the money would have been paid by NJ taxpayers one way or the other. (and even the PANYNJ picking it up overruns still means much of the cost carried by NJ residents/taxpayers.)

Tolls are paid by NJ taxpayers, true. But thats confusing the issue. The money is not NJ tax money, i.e., money from the NJ Treasury. Yes, tolls are paid by NJ taxpayers (NJ drivers), but its not coming from the state coffers. Tolls are also paid by NY drivers and out-of-state drivers as well. So if the PANYNJ picked up any overruns, the Port's bondholders, not the NJ state treasury, would be on the hook.

I think there's always a lot of confusion in how people define a term like "NJ taxpayer". It seems that many use it as a colloquialism for people that live in NJ. When it fits them Pols use it to define "voters" or "constituents." But apparently others have a more precise definition of that that means- and would only include income tax payers/dollars. Maybe some would include property tax payers. 100 different definitions on any given day...

So I think I can clear it up plan and easy:

People that LIVE in NJ were going to pay a large percentage of the cost. Possibly the majority of the cost.

Arguing if it's taxpayer, bondholders, state coffers, PANYNJ, toll payers, or whatever is what confuses the issue. People with 07xxx and 08xxx zip codes (those are all NJ- right? lol) in their addresses where going to foot a large part of the bill.

People LIVING in NJ were going to pay more than there "fair share" in my humble opinion. This is a project that while benefiting NJ residents the most, it also benefits people LIVING in NY as well as pretty much everyone else who lives in America indirectly. As such NY residents, and all residents in America should have kicked in something more than a minimal amount in my humble opinion. While I wouldn't argue at all that NJ residents shouldn't pay a larger percentage then those other residents- it didn't seem like a fair deal (to me) at the moment that Christie pulled the plug. (Although as I said above , i think he could have easily gotten a much better deal for residents of NJ then what appeared to be the case at the moment he nuked the project. Likely even one that would have been "felt fair" in the end.)

The ARC project was being funded three ways:

Port Authority:

Bonds backed by revenues from toll increases at the six NJ-NYC crossings (approved and implemented)

NJ:

Bonds backed by revenues from toll increases on the NJ Turnpike and Garden State Parkway (approved and implemented)

Federal
Federal Grants, stimulus etc.. (approved, revoked)

The toll increases for the Port Authority and the NJ Turnpike authority went through, however there is no more ARC. The increased toll revenues are being diverted by the Christie administration to the NJ Transportation trust fund to keep it from going bankrupt during Christie's term. Otherwise to save the Transportation trust fund the gas tax, third lowest in the Nation, would have had to be raised which it hasn't in 20 years. There already is an impact on NJ Taxpayers, toll payers etc.. They are paying the increased tolls, however they are not getting what was promised for the toll increase. No ARC.

If the toll increases were rolled back after ARC was cancelled then I can agree with the idea that the cancelling of ARC was some sort of effort to save the State of NJ, and it's citizens, the possible ramifications of cost overuns etc.. However the tolls were not rolled back, they are still in effect, but instead of ARC they are being used to rebuild various roads in and around the Ports and Warehouses in Essex and Hudson county. And guess who's on the hook for those cost overruns?.. Or are highways projects not effected by cost increases and delays? Only Mass transit / rail?

It's obvious Christie wants to fund those road projects and show everyone he was able to do so without raising taxes, especially the gas tax.

As an aside, i was just on a road trip and down in Western Virginia, gas was under 3.00 a gallon.

I know the regional gas prices have been affected by the type of crude oil that is used, with prices in the Northeast being higher because of the type of crude oil that is refined, but the gas tax and the rate of it, doesn't necessarily mean that gas prices will be that might higher or lower than other states because of the gas tax or lack of. Also, out in Central PA, gas prices are about equal to that in most of NJ.

Im just saying that with zone pricing and other pricing manipulations by the oil companies and other factors, that the gas tax really isn't as big of a factor in gas prices as it once was or is being made out to be.

Jtgshu wrote: Im just saying that with zone pricing and other pricing manipulations by the oil companies and other factors, that the gas tax really isn't as big of a factor in gas prices as it once was or is being made out to be.

Good point. In 2000 the gas tax comprised 22% of the cost of a gallon of gas; today its 14%. These figures would be lower in NJ of course.

Jtgshu wrote:As an aside, i was just on a road trip and down in Western Virginia, gas was under 3.00 a gallon.

I know the regional gas prices have been affected by the type of crude oil that is used, with prices in the Northeast being higher because of the type of crude oil that is refined, but the gas tax and the rate of it, doesn't necessarily mean that gas prices will be that might higher or lower than other states because of the gas tax or lack of. Also, out in Central PA, gas prices are about equal to that in most of NJ.

Im just saying that with zone pricing and other pricing manipulations by the oil companies and other factors, that the gas tax really isn't as big of a factor in gas prices as it once was or is being made out to be.

We built this city on rock and roll.

Tom V wrote:The ARC project was being funded three ways:

Port Authority:

Bonds backed by revenues from toll increases at the six NJ-NYC crossings (approved and implemented)

NJ:

Bonds backed by revenues from toll increases on the NJ Turnpike and Garden State Parkway (approved and implemented)

Federal
Federal Grants, stimulus etc.. (approved, revoked)

The toll increases for the Port Authority and the NJ Turnpike authority went through, however there is no more ARC. The increased toll revenues are being diverted by the Christie administration to the NJ Transportation trust fund to keep it from going bankrupt during Christie's term. Otherwise to save the Transportation trust fund the gas tax, third lowest in the Nation, would have had to be raised which it hasn't in 20 years. There already is an impact on NJ Taxpayers, toll payers etc.. They are paying the increased tolls, however they are not getting what was promised for the toll increase. No ARC.

If the toll increases were rolled back after ARC was cancelled then I can agree with the idea that the cancelling of ARC was some sort of effort to save the State of NJ, and it's citizens, the possible ramifications of cost overuns etc.. However the tolls were not rolled back, they are still in effect, but instead of ARC they are being used to rebuild various roads in and around the Ports and Warehouses in Essex and Hudson county. And guess who's on the hook for those cost overruns?.. Or are highways projects not effected by cost increases and delays? Only Mass transit / rail?

Look- everyone at this point basically knows and everyone but christie and a handfull of republicans will say that he cut the project to use the money to avoid raising the gas tax. Don't think anyone above has argued otherwise recently?

But as someone said above- doing the right thing for the wrong reason(s) doesn't mean it was the wrong thing to do. In my humble opinion the "right thing" that should have been down to get NJ residents to pay their "fair share" was to shame the Obama administration into get the feds to cover all (or almost all or even most of) the overruns and i think the way LaHood was talking and the way the Obama "high speed rail program" wound up that would have been pretty easy for Christie to have accomplished. Expecting NJ residents to pay for something approximating the majority of the costs didn't seem right to me. (again just my humble opinion)

So to follow along with your point above- now the extra toll money that NJ residents are in fact paying is being "directed" to projects that NJ residents would have paid for anyway eventually had the trust fund been properly funded- things that theoretically are more local in nature. And any cost overruns will also go to those projects. So it benefits NJ residents more than it would have otherwise (although to be honest nothing is 100% clear cut black and white. Traffic jams in NJ domino to effect probably the whole country- and truck traffic -which certainly isn't all local- pays fuel tax and tolls for sure). To be simplistic (although it's NOT as above) if it's a project that benefits NJ 100% then NJ residents paying 100% of overruns is "fair. If it's a project that benefits NJ 40%, NY 30%, and the country as a whole 30% then it's not fair for NJ to pay 100% of the overruns (or anything more than 40% for that matter). Rational people can have an honest discussion about what the proper percentages really are, but there's no reason that the residents of NJ should pay significantly more than the percentage that the project benefits them.

All that and the cost overruns on handfuls of smaller projects are somewhat easier to deal with then the cost overruns on one project that costs a huge pile. You have more flexibility - with one giant project you have little to do but see it through to the end or give up mid stream. With smaller projects you can scale things back easier (In NJ rail terms- you stop electrifying the NJCL at Matawan), you can cancel or put off some projects outright if others use your whole budget (rail example see the West Trenton Line, MOM, etc...), you can probably get your congress critters or state legislators or bureaucrats to find smaller amounts 15 different times (see the Cutoff...) then ask them to come up with 4 billion in overruns all at once. Etc, Etc

michaelk wrote: In my humble opinion the "right thing" that should have been down to get NJ residents to pay their "fair share" was to shame the Obama administration into get the feds to cover all (or almost all or even most of) the overruns and i think the way LaHood was talking and the way the Obama "high speed rail program" wound up that would have been pretty easy for Christie to have accomplished.

Michael you're missing a part of this. I don't think New Jersey would've had to "shame" the federal government into anteing up more money. What shame? This project -- once it no longer connected with Amtrak at both ends -- was basically a New Jersey project. Other people aren't really that interested in it. New York can live without it. Not trying to be mean, but that's the honest truth.

The problem people see is, the reason why Christie didn't want to try and shake more money out of the Obama Administration, is that he (Christie) probably didn't want to be in a position where it looked like Obama was helping him. Christie's perspective, his priorities, may not be what's best for New Jersey or New Jerseyites. His number one priority is his own political career.

Careerwise, nationwide people aren't going to care that Christie got more money from the Feds. The people Christie is trying to appeal to don't want Federal money. They like the fact he stopped a big public works project and told Obama, in effect, take your stinking money and shove it.