NJ Transit plans to raise fares for commuters to fund new rail tunnel

NEWARK, N.J. — New York and New Jersey announced Thursday how they will pay for their share of an estimated $13 billion project to build a new rail tunnel under the Hudson River and other improvements, with New Jersey’s governor outlining a plan that calls for progressively steeper fare hikes for train riders in his state over the next 20 years.

Combined with money already committed by the Port Authority of New York and New Jersey, the plans set up a framework for local funding of one-half of the cost of the tunnel and associated construction west of Penn Station in Manhattan.

The federal government was to pay for the other half under an agreement negotiated under former President Barack Obama, but President Donald Trump hasn’t said whether he will honor that commitment.

New Jersey plans to raise $1.9 billion by hiking rail fares by about 90 cents per cross-Hudson trip for New Jersey Transit train riders starting in 2020, with increases of $1.70 and $2.20 planned for 2028 and 2038, respectively.

NJ Transit, the nation’s third-largest provider of bus, rail and light rail, carries roughly 100,000 rail commuters per day from New Jersey to New York either directly or via connections to other carriers. Its last fare hike came in 2015 when it raised fares by an average of 9 percent.

New York plans to commit $1.75 billion to be financed over 35 years through a federal rail loan program, state budget director Robert Mujica Jr. wrote in a letter to the Department of Transportation on Wednesday.

The project, called Gateway, also envisions expanding Penn Station and adding track capacity on the New Jersey side. It is seen as essential to alleviating worsening congestion and delays in the New York region and on the Boston-to-Washington corridor. Roughly 750,000 people per day ride the corridor on Amtrak and several commuter railroads that share the tracks.

Amtrak, which owns the tunnels and most of the tracks along the corridor, has estimated the existing tunnel into New York could fail in 10 to 15 years due to saltwater damage caused by Superstorm Sandy in 2012.

Were that to happen, the number of rush-hour trains would plummet from 24 per hour to six if one of the tunnel’s two tubes had to be closed for repairs.