Hudson Tunnel Project to Receive $6.88B Federal Grant

On Jul 6, 2023

The Gateway Development Commission (GDC) announced that the Hudson Tunnel Project has entered the Engineering Phase of the Federal Transit Administration’s (FTA) Capital Investment Grants (CIG) Program and that the FTA had updated the project to receive an up to a $6.88 billion CIG Program grant.

The announcement clears the way for the Hudson Tunnel Project to receive the vast majority of the Federal funding needed for full construction. GDC said it expected the remainder of Federal funding to become available to the project through the approximately $4 billion in Federal-State Partnership for Intercity Passenger Rail Grant Program, Rebuilding American Infrastructure with Sustainability and Equity (RAISE), and Consolidated Rail Infrastructure and Safety Improvements (CRISI) Grants that have already been applied for.

Taken together, the CIG funding, along with other Federal components and Amtrak’s contribution, mean the entire project is poised to have the Federal funding it needs to undertake early work construction this year, and major construction in 2024. In addition, the States of New York and New Jersey, and the Port Authority of New York and New Jersey have committed to fully funding the local share of the project.

The next phase of the CIG Program process is negotiating and reaching a Full Funding Grant Agreement (FFGA) between the FTA and GDC, as the Project’s Sponsor, which is expected in 2024.

GDC applied to enter the critical Engineering phase in October 2022 and worked in partnership with the FTA on a risk assessment and an updated financial plan for the project.

“The entrance of the Hudson Tunnel Project into the Engineering Phase marks the most significant milestone to date for Gateway, which has advanced further than any predecessor project,” said Gov. Phil Murphy. “Just as importantly, this pivotal benchmark is a testament to the synergies we have forged with our regional neighbors and Federal partners. Indeed, early construction work will begin this year thanks in no small part to robust Federal funding and the commitment of the Biden Administration to modern, world-class infrastructure. We look forward to working with our Federal partners to secure the remaining funding necessary to complete the most urgent infrastructure project in the country.”

GDC has also made substantial progress in recent months advancing elements of the Hudson Tunnel Project:

• Early work is expected to begin later this year on both the Tonnelle Avenue Bridge and Utility Relocation Project in New Jersey and the Hudson Yards Concrete Casing – Section 3 in New York.
• Procurements were recently launched for 2 major components of the project, and GDC shortlisted potential Project Delivery Partners.
• A $25 million (US DOT) RAISE Grant to fund the Tonnelle Avenue Bridge and Utility Relocation portion of the project was announced.
• The US DOT’s Build America Bureau is advancing the application for obtaining Railroad Rehabilitation and Improvement Financing (RRIF) loans to support the project.
• $700 million from the President’s Proposed Fiscal Year 2024 Budget and the Capital Investments Grants Program was announced for the project.
• President Biden announced a $292 million grant to fund the Hudson Yards Concrete Casing – Section 3 project.

The Hudson Tunnel Project consists of two new tubes that cover four and a half miles each, and the rehabilitation of the 113-year-old existing tunnel, going from Secaucus Junction in New Jersey to Penn Station in New York. The four 21st-century tracks will connect New York and New Jersey to the rest of Northeast Corridor (NEC) stretching from Washington D.C. to Boston. They will eliminate a single point of failure for the NEC, providing long-term resiliency, reliability, and redundancy to the regional and national rail network.

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