A special note to our members and supporters about the ARC tunnel project

This op-ed was published on Sunday in the Bergen Record:

Over the weekend, New Jersey Governor Chris Christie abruptly halted work on the Access to the Region's Core (ARC) project, saying he needed greater assurances that the $8.7 billion commuter rail tunnel under the Hudson River could be delivered on budget. This has left transit advocates and New Jersey commuters wondering if the Governor is focused on reducing costs, or whether he intends to cancel one of the nation's most important transit improvements. We're all waiting with bated breath.

ARC will build two new commuter rail tracks under the Hudson River, doubling the capacity of NJTRANSIT to move commuters into and out of Manhattan and its 2 million jobs. NJTRANSIT's ridership has grown at terrific rates over the past 30 years - from only 8 million passengers in 1980 to almost 45 million annual passengers in 2009. Over the same time period, this trend drove incredible growth in pharmaceutical companies, financial industries and business services, all of which depend on New Jersey's joined-at-the-hip connections to New York City. And as anyone who has endured the cattle call of loading a 5 PM train at New York Penn Station or stood the entire ride from Newark to New Brunswick can tell you, there isn't much free capacity in the existing system to keep adding those commuters and jobs unless there are more trains.

The benefits of building the tunnel will be enormous. ARC will double the number of households in New Jersey within a 50-minute commute to Manhattan. Jobs in Manhattan pay, on average, 60% more than jobs in New Jersey. A study commissioned by NJ TRANSIT estimated that ARC would increase the Gross Regional Product by $660 million a year, split evenly on both sides of the Hudson River. And RPA's own research estimates that building ARC will increase the value of New Jersey residences close to train stations by more than $18 billion over 8 years. In addition, only one-third of the funding for the project is coming from the State. In addition to $2.7 billion from New Jersey, the project has committed funds of $3 billion from the Port Authority of New York and New Jersey and $3 billion from the federal government - the largest commitment of federal funds for a transit project - ever! These funds will be put in jeopardy if the project is cancelled.

So why would Governor Christie consider putting such a worthwhile project on hold?

One possibility is that the Governor is doing everything he can to make sure this doesn't become another ill-fated Big Dig - the Boston Artery tunnel that ballooned from $2.8 billion in 1985 to $14.6 billion by 2006. If this is the case, then we should applaud the Governor for working hard to keep costs under control and make sure the project does not turn into another endless series of delays and overruns. This thinking does have some credence, since Governor Christie appointed two senior transportation officials - DOT Commissioner Jim Simpson and NJ TRANSIT Executive Director Jim Weinstein - with outstanding credentials and a record of supporting the project.

The less optimistic perspective is that the delay is a first step to killing or indefinitely delaying the project. Why would the Governor do this? Possibly because while ARC has its funding in place, the rest of the state's transportation funding situation is a mess. This isn't Governor Christie's fault. Half a dozen Governors over ten years have spent more than the state's Transportation Trust Fund could afford, collecting about $900 million a year in gas taxes and other sources, but spending about $1.4 billion each year on capital projects. The gap was filled by borrowing - a familiar story in New Jersey these days. Unfortunately, the bill is now due. Starting in less than one year, every dollar collected in gas tax revenues for the next 30 years will go to paying off bonds that have already been spent. Unless hundreds of millions of dollars in new revenues or significant cost reductions can be identified, the state's capital spending on other transportation projects (street and bridge repairs, highway upgrades, other transit investments, etc.) will drop dramatically.

The fault with this thinking is that while ARC may be a big expensive project, it is also an excellent one. In the short term, building the new tunnel will provide new construction jobs. In the mid-term, companies and workers will continue locating in the Garden State, home construction will pick up, and the value of real estate will rise. And in the long term, New Jersey will be more connected to New York City and the expanding global economy.

Pulling back from ARC would be a mistake of enormous proportions. Here's hoping that governor Christie seizes the opportunity to improve - and not abandon - this critical project.

-- RPA staff

Over the past two years, RPA has published a number of reports and white papers detailing the benefits of ARC and New Jersey's transportation funding crisis:

Clearing the Air about ARC
The ARC Effect: How better transit boosts home values and local economies
Spiral of Debt: The Unsustainable Structure of New Jersey's Transportation Trust Fund
ARC & NYC: The new trans-Hudson rail report: Making it work best
An editorial in the Newark Star-Ledger agrees with our position.