Tom V wrote: ↑Wed Dec 01, 2021 3:43 pm
All approvals have been received, all that is needed now is to change the project's rating from the FTA. That will allow the partners, NJ, NY, Port Authority, Amtrak to enter into a financing agreement with the Federal Government. Construction is slated to start Summer of 2023.
https://www.nj.com/news/2021/12/hudson- ... ng-it.html
From your link:
"But funding remains the next major hurdle. The project’s ranking needs to be raised by the Federal Transit Administration to qualify for federal grants. The tunnel project had received a low rating under the Trump administration that precluded it from qualifying for federal funding.
Railroad and other infrastructure loans that would comprise New Jersey and New York’s share of the project also need to be applied for and approved.
The states received a boost from recent changes to those programs that allow the loans to be paid off over 75 years, considering the lifespan of major railroad infrastructure projects, instead of an original 35-year payback period.
A “letter of interest” to start the loan application process for an estimated $6 billion in infrastructure loans is being prepared and could be submitted in the next couple of months,"
If an existing program will not support a particular project, change the regulations. 75 years of interest payments vs 35 years, and some wonder why NY/NJ projects always cost twice as much?
Why did the FTA rank this project so low under Trump? A medium-low rating makes it ineligible for Federal funding. That was not answered by this press release.
https://www.railwayage.com/passenger/in ... ow-rating/
"New Jersey and New York both intend to rely on long-term federal loans to fund 50% of the project, which AP reports would be between $6 billion and $7 billion. The states would expect the federal government to finance the other half of the costs with grants.
According to AP, USDOT believes the states are asking for too much federal funding, and on March 15 said that the most recent financial plan proposed by project organizers did not address the key concerns identified by FTA in last’s year rating.”
It has a medium-low rating because 100% of the required funding was coming from Federal funding, 50% from Federal Grants and 50% from Federal backed low interest loans. NY and NJ had 0% of their own money invested into the Gateway Tunnels. Every other transit project financed by the FTA qualifies using one of either funding mechanism, but not both. Only the Gateway Tunnels expects to use both, which is why its rating is so low.
Put more of your own skin into the project and maybe the FTA will up its rating.
For those who might suggest the low rating was politically motivated, why has not NY/NJ sued the FTA over it? Both Trump and Biden have been sued over far less money. Maybe, just maybe, that low FTA rating was justified under the present regulations. Of course, we now have a new administration and a new Congress, regulations can be changed to meet the new political situation. But should they? What is so wrong expecting local governments to share in the financial burdens of infrastructure projects?