Testimony by Thomas K. Wright, President, Regional Plan Association, before the United State Senate Committee on Commerce, Science and Transportation Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety and Security on Passenger Rail Reauthorization, May 4, 2014

Chairman Fischer, Ranking Member Booker, and Members of the Committee:

Good morning. I’m Tom Wright, President of Regional Plan Association. Thank you for giving me the opportunity to speak on the important subjects of passenger rail reauthorization, and the need to improve and modernize the Northeast Corridor.

The NEC is the busiest rail line in America and perhaps the most complex rail corridor in the world. You have a tough job ahead of you and we are eager to work with you as you work to reauthorize our federal rail programs and tackle the enormous challenges we face on the corridor, including its worst bottleneck – the two-track stretch between Newark and New York City, its aging bridges, and the infamous tunnels under the Hudson River.

RPA is partnering with leading business and civic groups throughout the Northeast to promote investment in the NEC because of the essential role it plays in the regional economy, as a vital link for millions of residents, workers and visitors.

RPA strongly supports a robust improvement program to fix and upgrade the Northeast Corridor. The economies of the New York region, the Northeast – and indeed the nation – depend on the federal and state governments and private sector working in tandem to address the immediate and urgent challenge of rebuilding, maintaining and expanding the Northeast Corridor’s aging infrastructure.

Each weekday the Hudson River tunnels carry more than 170,000 rail passengers in and out of Manhattan – tripled since 1990 – and RPA’s projections show that if we have the capacity, demand will continue to grow in the coming decades. However, the tunnels are old and deteriorating, and unable to handle current, let alone future demand.

These crucial assets that carry the lifeblood of New York’s regional economy are at risk. The rail tunnels under the Hudson River opened in 1910 and more than 100 years of daily abuse have taken a toll on the tunnels’ infrastructure. First, many of you may not know that the weight of the river fluctuates with the tides and as a result the tunnels compress and expand slightly with every change of the tide, twice daily.

In October 2012, Superstorm Sandy flooded the tunnels for the first time in their long history. The water was quickly pumped out, but left behind a coating that is eating away at their reinforcing steel and concrete. For years, one of the tubes has been closed overnight on weekdays and during weekends for maintenance, but these stopgap repairs are no longer enough and the tunnel is threatened by a shutdown if conditions worsen.

As previous speakers have said, each of the tubes will need to be closed for up to a year or more at a time for extensive repairs and Amtrak says this work must commence in the next 15-20 years, leaving precious little time to build two new tunnels. If these new tunnels are not in place, the tunnel closures will reduce train traffic by an estimated 75% in the peak hour, forcing over 50,000 people a day to find alternatives means of travel in and out of Manhattan. Huge disruptions would follow for all who travel across the Hudson, whether by train, bus, ferry or car. Most likely, many of them would no longer be able to make the journey.

Compounding this problem, RPA expects the huge increases in regional rail travel we have experience over the last 20 years to continue. We are projecting up to 100 percent increase in travel through Penn Station, and a 50 percent increase in travel to the Port Authority Bus Terminal, which will also be unable to handle future demand. Without the ability to accommodate this growth, the economies of both states will suffer.

Fixing this bottleneck is about far more than simply avoiding disaster. It’s about giving the nation’s largest metropolitan economies a chance to grow and keep pace with Shanghai, London, Paris and other world cities that are investing far more in their transit infrastructure. We have a chance to add 2 million jobs to the New York region’s economy over the next 25 years, giving more people a chance for getting ahead, and supporting more of the services that people want and need, from high quality schools to reliable public transportation.

But this will only happen if we make the right investments, and no investments are more important than ones to increase Trans-Hudson capacity.

Many possible solutions have been suggested. The most obvious option is the Gateway program proposed by Amtrak, which would build two new tunnels and several bridges, expand Penn Station, and add two new tracks between Newark and New York, doubling trans-Hudson rail capacity.

This will be a massive effort – bigger than anything Amtrak has ever built or attempted to build. Cost estimates are inching close to $20 billion. But the need is enormous, and the investment must be made.

At RPA’s annual conference last month, I conducted a poll of the audience of several hundred leaders in New York’s business and civic community. I asked the audience,

What is more likely to happen first?

A) A new tunnel under the Hudson River is built, or

B) One of the existing tunnels is shut down for an extended period of time.

85% of the respondents selected B.

Think about that – more than 4 out of 5 of the people paying closest attention to this issue think we will fail to prevent a disaster – when we already know about the dangers.

This Thursday, working with our partners – Amtrak, MTA, NJ Transit and the Port Authority – RPA is convening a summit of regional leaders in the transportation community to discuss the state of the infrastructure linking New York and New Jersey, plans and proposals to increase trans-Hudson capacity, and the financial and regulatory hurdles to be faced in making these plans a reality. The Gateway Program certainly will be the emphasis of these discussions.

We all know it must get done. The question is how to get it done.

RPA’s strongly supports enough federal funding in the next rail bill to put the corridor on track to eliminate the backlog of deferred maintenance – currently more than $20 billion – and fully fund Amtrak’s normal capital program, so it has the resources to keep the corridor in safe, working order. Gateway is the largest component of this improvement program. This will be necessary, but still insufficient to meet the growing economic and mobility needs of the Northeast.

According to the NEC Commission, the historic level of funding for the NEC’s capital program is $400 million a year. It would take $4 billion a year to completely eliminate the backlog of work and make basic improvements within 15 years.

To achieve our shorter-term goals and build a foundation for achieving our long-term vision, we believe three main things are missing and sorely needed:

• Strong leadership from the president and Congress – most of the NEC is a federal asset and it is the responsibility of the federal government to return it to a state of good repair. This will also create incentives for the states and private sector to contribute more to the long-term improvement of the NEC,
• A new infrastructure authority with the capabilities to plan and prioritize projects, and attract and receive the maximum level of private sector investment to improve the NEC, and
• A new approach to funding and financing that includes new reliable sources of revenue dedicated to the finance critical NEC projects.

To secure the necessary political and financial support from state and municipal governments, as well as the private sector, it will be essential to create a new governance structure for project selection, management and finance in the corridor. This structure could build upon the recent successes in governance, planning and project delivery already demonstrating their benefits in the corridor.

These successes include the creation of the NEC Commission, FRA’s undertaking of NEC Future, a long-range master plan of the corridor, and Amtrak’s Strategic Plan that created new divisions for Northeast Corridor infrastructure development and rail operations.

This vision can only be achieved through a partnership between the federal government, Amtrak, and state and municipal governments, as well as the private sector. Robust federal funding and changes in various federal financing programs are required to incentivize state, local and private contributions to the corridor’s capital projects, which will nurture this partnership over time.

RPA recommends that the next federal rail bill create a grant program authorized to award $10 billion to NEC improvement projects, in addition to Amtrak’s normal capital funding. These grants could be used to pay project planning, engineering, design, construction, procurement or financing costs. Federal loans from the Railroad Rehabilitation & Improvement Financing (RRIF) program could be used to finance much of the rest of the budget for this improvement program, and repaid using existing or new revenue streams. User fees and value capture mechanisms also could be used to help finance the debt service on RRIF loans.

This Committee and Congress, and all of the other members of this esteemed panel have the ability to begin transforming the NEC into the world-class corridor it must become if the Northeast is going to remain an engine of the national economy and a strong competitor in global markets.

The proposals I have laid out would build on significant progress already made by Amtrak, the NEC Commission, Federal Railroad Administration and the states in returning the corridor to a state of good repair and creating a long-range master plan for the corridor. The next federal rail bill should authorize key investments required to eliminate the NEC’s worst bottlenecks, create new capacity and reliability, and build a foundation for high-speed rail in the future.

I urge you to make these policies and investments for the NEC a keystone of the upcoming rail reauthorization bill.

Thank you.