Gov. Christie first canceled the $8.7 billion tunnel first on October 7, citing potential cost overruns for which he said the state had no way to pay. The following day, he agreed to look at ways to salvage the project after meeting with U.S. Transportation Secretary Ray LaHood.
Two government officials close to the project confirmed Tuesday that the Republican governor had decided against those options.
In early September, even before he first announced his decision, Christie called a halt to awarding new contracts. Last Friday, LaHood, though a supporter of the tunnel, publicly admitted that federal estimates showed the project could go between $1 billion and $4 billion over budget.
Work on the tunnel broke ground in 2009 and was expected to take another eight years to complete. It would have doubled the number of NJ Transit commuter trains that could come into Manhattan every morning rush hour from about 45 to 90.
Transit advocates predict that canceling the train tunnel would lead to greater congestion on roads and more delays for NJ Transit trains. Christie, meanwhile, has been using his treatment of the project as an example of fiscal prudence on the numerous campaign stops he's made in support of Republican candidates across the country.
The federal government was planning to chip in just over $3 billion to the project, and the Port Authority of New York and New Jersey another $3 billion. New Jersey was slated to contributed $2.7 billion -- including discretionary transportation money that actually comes from Washington but could have been used on other transportation projects. But the Port Authority and New Jersey would have been on the hook to pay for any cost overruns, according to project documents.
New Jersey Senator Frank Lautenberg, a Democrat, criticized Christie's decision after it was first reported in the Star-Ledger and by the Associated Press.
"The federal government presented Governor Christie with a number of financing options that would limit and even eliminate New Jersey's responsibility to pay for cost overruns on the ARC tunnel," he said in a statement. "But it was clear from the beginning that Governor Christie planned to kill this project no matter what."
But another official disputed that interpretation of the federal government's offer.
More details are expected to emerge Wednesday.