Amtrak’s Gateway project, spending $30 billion on new tunnels from New Jersey to Penn Station, just got its federal funding yanked. Previously the agreement was to split funding as 25% New York, 25% New Jersey, 50% federal; the states had committed to $5.5 billion, which with a federal match would build the bare tunnels but not some of the ancillary infrastructure (some useful, some not).
When Chris Christie canceled ARC in 2010, then estimated at $10-13 billion, I cheered. I linked to a YouTube video of the song Celebration in Aaron Renn‘s comments. ARC was a bad project, and at the beginning Gateway seemed better, in the sense that it connected the new tunnels to the existing station tracks and not to a deep cavern. But some elements (namely, Penn Station South) were questionable from the start, and the cost estimate was even then higher than that of ARC, which I attributed to both Amtrak’s incompetence and likely cost overruns on ARC independent of who managed it.
But I’m of two minds about to what extent good transit advocates should cheer Gateway’s impending demise. The argument for cheering is a straightforward cost-benefit calculation. The extra ridership coming from Gateway absent regional rail modernization is probably around 170,000 per weekday, a first-order estimate based on doubling current New Jersey Transit ridership into Penn Station. At $40,000 per weekday rider, this justifies $7 billion in construction costs, maybe a little more if Gateway makes it cheaper to do maintenance on the old tunnels. Gateway is $30 billion, so the cost is too high and the tunnel should not be built.
Moreover, it’s difficult to raise the benefits of Gateway using regional rail modernization. On the New Jersey side, population density thins fast, so the benefits of regional rail that do not rely on through-running (high frequency, fare integration, etc.) are limited. The main benefits require through-running, to improve access on Newark-Queens and other through-Manhattan origin-destination pairs. Gateway doesn’t include provisions for through-running – Penn Station South involves demolishing a Manhattan block to add terminal tracks. Even within the existing Penn Station footprint, constructing a new tunnel eastward to allow through-running becomes much harder if the New Jersey Transit tracks have heavy terminating traffic, which means Gateway would make future through-running tunnels more expensive.
But on the other hand, the bare tunnels are not a bad project in the sense of building along the wrong alignment or using the wrong techniques. They’re just extremely expensive: counting minor shoring up on the old tunnels, they cost $13 billion for 5 km of tunnel. Moreover, sequencing Gateway to start with the tunnels alone allows dropping Penn South, and might make it possible to add a new tunnel for through-running mid-project. So it’s really a question of how to reduce costs.
The underground tunneling portion of Second Avenue Subway is $150 million per km, and that of East Side Access is $200 million (link, PDF-p. 7). Both figures exclude systems, which add $110 million per km on Second Avenue Subway, and overheads, which add 37%. These are all high figures – in Paris tunneling is $90 million per km, systems $35 million, and overhead a premium of 18% – but added up they remain affordable. A station-free tunnel should cost $350 million per km, which has implications to the cost of connecting Penn Station with Grand Central. Gateway is instead around $2 billion per km.
Is Gateway expensive because it’s underwater? The answer is probably negative. Gateway is only one third underwater. If its underwater character alone justifies a factor of six cost premium over Second Avenue Subway, then other underwater tunnels should also exhibit very high costs by local standards. There aren’t a lot of examples of urban rail tunnels going under a body of water as wide as the Hudson, but there are enough to know that there is not such a large cost premium.
In the 1960s, one source, giving construction costs per track-foot, finds that the Transbay Tube cost 40% more than the bored segments of BART; including systems and overheads, which the source excludes, BART’s history gives a cost of $180 million, equivalent to $1.38 billion today, or $230 million per km. The Transbay Tube is an immersed tube and not a bored tunnel, and immersed tubes are overall cheaper, but a report by Transport Scotland says on p. 12 that immersed tubes actually cost more per linear meter and are only overall cheaper because they require shorter approaches, which suggests their overall cost advantage is small.
Today, Stockholm is extending the T-bana outward in three direction. A cost breakdown per line extension is available: excluding the depot and rolling stock, the suburban tunnel to Barkarby is $100 million per km, the outer-urban tunnel to Arenastaden in Solna is $138 million per km, and the part-inner urban, part-suburban tunnel to Nacka is $150 million per km. The tunnel to Nacka is a total of 11.5 km, of which about 1 is underwater, broken down into chunks using Skeppsholmen, with the longest continuous underwater segment about 650 meters long. A 9% underwater line with 9% cost premium over an underground line is not by itself proof of much, but it does indicate that the underwater premium is most likely low.
Based on the suggestive evidence of BART and the T-bana, proposing that bare Hudson tunnels should cost about $2-2.5 billion is not preposterous. With an onward connection to Grand Central, the total cost should be $2.5-3 billion. Note that this cost figure does not assume that New York can build anything as cheaply as Stockholm, only that it can build Gateway for the same unit cost as Second Avenue Subway. The project management does not have to be good – it merely has to be as bad as that of Second Avenue Subway, rather than far worse, most likely due to the influence of Amtrak.
The best scenario coming out of canceling Gateway is to attempt a third tunnel project, this time under a government agency that is not poisoned by the existing problems of either Amtrak or Port Authority. The MTA could potentially do it; among the agencies building things in the New York area it seems by far the least incompetent.
If Gateway stays as is, just without federal funding, then the solution is for Amtrak to invest in its own project management capacity. The cost of the Green Line Extension in Boston was reduced from $3 billion to $2.3 billion, of which only $1.1 billion is actual construction and the rest is a combination of equipment and sunk cost on the botched start of the project; MBTA insiders attribute this to the hiring of a new, more experienced project manager. If Gateway can be built for even the same unit cost as Second Avenue Subway, then the existing state commitments are enough to build it to Grand Central and still have about half the budget left for additional tunnels.