Hudson River Tunnel Project Gets a New, Higher Price Tag: $13 Billion

A project to upgrade and expand the rail tunnels between New York and New Jersey has a new, higher price tag.

Officials are now pegging the cost of the Gateway Hudson tunnel project at $12.9 billion dollars. That's almost twice the original estimate of $7 billion.

John Porcari, interim managing director of the Gateway Program Development Corporation, said the original estimate was only for constructing a new tunnel; it didn't include the cost of repairing the existing, 106-year-old tunnel damaged by Sandy in 2012.

"This is actually two things," Porcari said at a news conference Thursday. "This is building a new tunnel. And then taking the existing tunnel's two tubes, one at a time, out of service, to comprehensively rehabilitate them."

Porcari also says the old estimate was based on a very preliminary design. Now that the design is further along,  officials have discovered unanticipated costs.

The Hudson tunnel upgrades are part of the first planned phase of Gateway, a $24 billion dollar infrastructure project that also aims to expand Penn Station and replace aging rails that create bottlenecks in New Jersey (ahem, Portal Bridge).

As the project moves forward, Porcari said the cost-estimate for the project will continue to change. "The cost goes up with every day of delay," he said. "That cost increase on a major project could be hundreds-of-millions of dollars a year."

Under an agreement reached under former President Barack Obama, New York and New Jersey would split half the cost of Gateway, and the federal government would contribute the other 50 percent. But President Donald Trump's proposed budget, and the U.S. Transportation Department's recent decision to withdraw from Gateway's supervising board, leave Gateway's future funding prospects uncertain.

Asked whether he was concerned if the Transportation Department's withdrawal signals a potential loss of federal funds, Porcari said, "No project of this magnitude can move forward without federal financial help."