Agreement Reached To Reduce Costs For Cancelled Hudson River Rail Tunnel

NEWARK – Federal and state officials have reached an agreement on the amount of money New Jersey would pay to reimburse the federal government for money spent on a cancelled rail tunnel that would have expanded access between New Jersey and Manhattan.

U.S. Transportation Secretary Ray LaHood announced that he had signed an agreement with Gov. Chris Christie to reduce the amount New Jersey owed to $95 million. The Department of Transportation had been seeking the repayment of $271 million that had been spent before the project’s cancellation.

New Jersey’s senators, Frank Lautenberg and Robert Menendez, helped broker the agreement.

“The Governor’s decision to kill the ARC tunnel project will hurt New Jersey in the long-term, but we were happy to work with the Department of Transportation to help reduce the costs of this mistake,” Lautenberg said.

Christie cancelled the multi-billion ARC Tunnel project because of fears that New Jersey taxpayer would have been left liable for potentially substantial cost overruns.

An alternative project proposed by Amtrak, the Gateway Tunnel, is in the early planning stages.

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