Gateway project gets first chunk of federal funds; billions more to come

The long-stalled New York-New Jersey Gateway project will receive just under $300 million in federal funds — the first tranche of what could be billions in federal aid — to help complete early stages of a massive project that President Joe Biden Tuesday called “a national priority.”

The Gateway Program is “one of the biggest and most consequential projects in the country,” Biden said at a press conference Tuesday at the Hudson rail yard where he appeared with a slew of federal, state, and local officials. The $292 million grant will be used to complete a $649 million concrete casing to preserve right-of-way for a new two-track tunnel under the Hudson River. The tunnel, with a $16 billion price tag, is the centerpiece of the larger Gateway project.

“This is just the beginning of finally constructing a 21st Century rail system that’s long overdue in this country,” Biden said. “To have the best economy in the world, you have to have the best infrastructure in the world.”

The Gateway Program will rebuild and rehab rail infrastructure projects between Newark, New Jersey and Penn Station in New York City along the Northeast Corridor, the most heavily used passenger rail line in the U.S. that contributes 20% of the national GDP.

First proposed in 2011, the Gateway Program was stalled by former New Jersey Gov. Chris Christie and later by President Donald Trump who pledged to pull all federal funding. 

“After many false starts and obstacles placed in our way, Gateway is finally full speed ahead,” said longtime cheerleader Sen. Chuck Schumer. “With today’s new dollars, Gateway’s future is ensured,” the New York Democrat said. 

The new two-track Hudson tunnel and renovation of the existing tunnel carry a price tag of around $16.1 billion. The total Gateway program may cost as much as $40 billion for all the rail infrastructure improvements. 

A full financing package may be hammered out later this year if certain milestones are met by New York and New Jersey, according to the White House.

The $292 million grant, which will go to Amtrak, is the largest federal aid to date for the project and could mark the first of several rounds of federal funds rolled out this year. 

The bistate Gateway Development Commission has applied for a total of $6.7 billion from the Federal Transit Administration for the tunnel project, and is expected to apply for an additional $4 billion in federal funds under the Bipartisan Infrastructure Law.

The $292 million grant comes from the Bipartisan Infrastructure Law’s National Infrastructure Project Assistance discretionary grant program, also known as Mega, which will allocate $5 billion through 2026 for projects of national significance that are too large or complex for traditional funding.

The administration Tuesday announced $1.2 billion in Mega grants for nine projects, including the Hudson Tunnel. 

Transportation Secretary Pete Buttigieg said Tuesday that the grant program’s first year was “wildly competitive.” There were 138 applications, and only nine received federal funds, he said.

Other Mega grants announced Tuesday include $250 million for the Brent Spence Bridge; $150 million to replace the I-10 Calcasieu River Bridge, a key project in Louisiana; $110 million to replace North Carolina’s Alligator River Bridge, which is a critical hurricane evacuation route; $60 million to make improvements to the I-10 freight corridor in Mississippi; and $78 million for the Roosevelt Boulevard multimodal project in Philadelphia;