No tunnel, but N.J. in the hole for $271m

November 30, 2010|Associated Press

TRENTON, N.J. — New Jersey owes the federal government more than $271 million after canceling a rail tunnel connecting the state with New York City, according to a debt notice obtained yesterday by the Associated Press.

The letter from the Federal Transit Administration’s chief financial officer to NJ Transit’s executive director demands payment of $271,101,291 by Dec. 24.

It’s money the government wants New Jersey to repay for work done on the Hudson River tunnel before Governor Chris Christie, a Republican, terminated the project. The notification follows a warning letter earlier this month estimating the charges.

“FTA demands payment in full within 30 days from the date of this letter, hereinafter referred to as the ‘delinquency date,’ ’’ the letter states. The letter was dated Nov. 24.

NJ Transit executive director Jim Weinstein said earlier this month that the state had not determined if it would have to pay any money back.

The transit agency has the right to request a review of the charges and to dispute all or part of the debt.

A Christie administration spokesman, Michael Drewniak, would not say yesterday whether the charge would be paid in full or disputed, or where New Jersey would get the money if it decides to repay the government or is found liable for all or part of the bill.

The $8.7 billion project to construct a second rail tunnel between New Jersey and New York — known as Access to the Region’s Core, or ARC — was 15 years in the making when Christie pulled the plug Oct. 27, citing potential cost overruns.

More than $600 million had been spent for engineering, construction, and environmental studies.

Christie has since said he would consider contributing to a cheaper alternative: extending New York City’s No. 7 subway line under the Hudson River to New Jersey.