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Gateway Tunnel's prospects remain unclear with lack of federal funding

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The U.S. Department of Transportation was not impressed by a recent funding proposal from Andrew Cuomo and Chris Christie

Courtesy of Amtrak

Last week, New York Governor Andrew Cuomo and New Jersey Governor Chris Christie penned separate letters to the U.S. Department of Transportation that detailed how the two states planned on coming up with their share of funding for the Gateway Tunnel project. While the two governors say that they plan on underwriting a portion of the project’s cost by relying on a loan from the U.S. DOT, federal funding remains uncertain, putting the fate of the entire project at jeopardy, reports Crain’s.

A spokeswoman for the federal transportation agency says that the DOT is now considering the loans as part of the government’s contribution to the project. “The plan now seeks 100 percent of its funding from federal sources,” said the spokesperson. “No actual local funds are committed up front. They propose the project is funded half in grants and half in loans. This is not a serious at all.”

However, it is not an uncommon practice for states to secure federal loans to finance their share of large transportation projects.

“I think it’s just a poor reading of the facts,” said CEO of the Partnership for New York City, Kathryn Wylde. “Unlike the federal government, states don't print money. They rely on loans, including federal infrastructure loans, that they can repay over time. Under no scenario does that diminish their obligation and contribution to the project.”

A spokesperson for the Gateway Development Corporation said that the proposal from Cuomo and Christie is “consistent with the 50:50 federal/local framework” and was “submitted in accordance with longstanding U.S. Department of Transportation guidelines.”

Though it remains uncertain how New York and New Jersey will secure funding from the federal government for the $13 billion commuter rail line, at least one person is remaining optimistic: Wylde told Crain’s that she has been “repeatedly assured” by the White House that the project is a “national priority” and has confidence that the federal government will see to it that it gets done.