Access to the Region's Core

Access to the Region's Core (ARC)

Company type	Public transportation project
Industry	Rail transport
Founded	1995
Defunct	2010
Fate	Canceled by New Jersey Governor Chris Christie
Area served	New Jersey, New York City
Products	Commuter rail tunnel and station infrastructure

Access to the Region's Core (ARC) was an intended commuter rail initiative designed to enhance New Jersey Transit (NJT) capacity between Secaucus Junction, New Jersey, and Manhattan, New York City. The proposal encompassed new track construction, a rail yard, and a tunnel beneath the Hudson River, alongside a new station positioned next to New York Penn Station to handle increased passenger volume. The project’s budget was estimated at $8.7 billion. Groundbreaking occurred in mid-2009 with an anticipated completion date in 2018; however, New Jersey Governor Chris Christie canceled the project in October 2010 due to concerns over escalating costs and funding gaps. Approximately $600 million had already been expended prior to termination. This cancellation has remained a subject of debate.

After ARC was halted, the federal government requested reimbursement of funds allocated to NJT. Although the Christie administration initially disputed this demand, it ultimately consented to return a portion of the money while redirecting the remainder toward other transit-related initiatives.

Speculation about extending the New York City Transit Authority’s 7 Subway Extension into New Jersey emerged following ARC’s cancellation but was eventually abandoned. In February 2011, Amtrak unveiled the Gateway Project, which proposed constructing new tunnels and rights-of-way connecting Newark Penn Station to New York Penn Station via Secaucus Junction, with usage shared by NJT trains.

Governor Christie redirected funding from the Port Authority of New York and New Jersey (PANYNJ) toward road infrastructure projects within New Jersey. A 2012 review by the Government Accountability Office questioned the justification for ARC’s termination. Investigations conducted by the Manhattan District Attorney and Securities and Exchange Commission into potential misuse of PANYNJ funds resulted in $400,000 in penalties related to projects such as the Pulaski Skyway.

Infrastructure

The ARC project sought to more than double rail service frequency from New Jersey into Midtown Manhattan, providing direct, one-seat rides on most New Jersey Transit lines along with increased service within New Jersey. It planned construction of two additional tunnels beneath the Hudson River to relieve congestion on the existing North River Tunnels, which were operating at full capacity. These new tunnels would lead into a state-of-the-art six-track station located under 34th Street, east of Penn Station, featuring pedestrian connections to multiple New York City Subway lines: Eighth Avenue, Seventh Avenue, Sixth Avenue, and Broadway. The design also included a new rail loop near Frank R. Lautenberg's Secaucus Junction enabling direct Midtown access for trains from the Main Line/Bergen County Line and Pascack Valley Line, along with a midday train storage yard located in the Kearny Meadows. While trains would terminate at this newly constructed station, provisions for potential future eastward extensions depended on securing additional funding.

Cost and funding

In 2009, the Federal Transit Administration estimated ARC’s total cost at $8.7 billion, with funding sources broken down as follows:

• Federal New Starts program: $3.0 billion
• Federal American Recovery and Reinvestment Act (ARRA): $130 million
• Federal Congestion Mitigation and Air Quality (CMAQ) & Federal Highway Administration (FHWA): $1.32 billion
• Port Authority of New York and New Jersey contribution: $3.0 billion
• New Jersey Turnpike Authority allocation: $1.25 billion

By the time of cancellation, projected expenses had risen close to $11 billion, with roughly $610 million already invested in land acquisition, environmental studies, and engineering design. The Port Authority had procured or leased properties on Manhattan’s West Side. Condemnation proceedings in Hudson County remained unresolved after project termination.

Governor Christie reassigned these funds toward highway projects. In March 2011, PANYNJ redirected $1.8 billion originally intended for ARC toward repairing roads and bridges in Hudson County critical to the Port of New York and New Jersey’s logistics network. By September 2011, the Turnpike Authority dedicated its $1.25 billion share to state highway infrastructure improvements.

Design

The ARC initiative commenced in 1995 with the Access to the Region's Core Major Investment Study (MIS), which examined 137 options including bus, light rail, subway, Port Authority Trans-Hudson (PATH) rail, commuter rail, ferry services, emerging technologies, and automobile solutions. Completed in 2003, the MIS narrowed down to two proposals for the Draft Environmental Impact Statement: Alternative P suggested new tracks and platforms beneath Penn Station; Alternative S proposed a new rail connection to Penn Station alongside additional East River Tunnels leading to expanded storage at Sunnyside Yard. Alternative G, which would have connected to Grand Central Terminal, was not pursued further.

The environmental review spanned from 2003 through 2009. Initial designs incorporated the Penn Station Connector, enabling NJ Transit and Amtrak to utilize either existing or newly constructed ARC tunnels. However, this plan required building a substantial mid-river cofferdam, encountering regulatory challenges from the United States Environmental Protection Agency and United States Coast Guard due to interference with the contaminated Hudson River Superfund site and active shipping channels. Moreover, cut-and-cover tunneling along Manhattan’s West Side threatened displacement of businesses and residents, failing to gain local stakeholder approval.

By 2006-2007, NJ Transit determined that constructing a deeper underground terminal using tunnel boring machines was essential to minimize environmental and community disruption. This decision generated significant debate.

Contracts for design and construction management were awarded in 2006 to THE Partnership (a joint venture of Parsons Brinckerhoff, STV, and DMJM Harris/AECOM) and CM Consortium (a joint venture of Tishman, Parsons Corp., and ARUP).

In July 2006, the Federal Transit Administration (FTA) granted approval for preliminary engineering of the tunnel project, indicating potential federal funding support. The FTA subsequently approved the Draft Environmental Impact Statement (DEIS) in January 2007 and the Supplemental DEIS in March 2008. The Supplemental DEIS assessed the effects of a deeper tunnel profile without track connections to existing Penn Station—reflecting adjustments made due to environmental, community, and engineering concerns. The Final Environmental Impact Statement (FEIS) received approval in October 2008. In January 2009, the FTA issued its Record of Decision authorizing progression to final design.

Beginning of construction

The initial construction contract was awarded in June 2009 for creating a new railroad underpass at Tonnelle Avenue in North Bergen, with groundbreaking occurring on June 8, 2009. The Palisades Tunnels contract—the project's first significant tunneling contract—was awarded on May 5, 2010.

Cancellation

Governor Christie initially supported the project in April 2010 but gradually withdrew his backing. On September 10, 2010, NJ Transit’s executive director ordered a 30-day halt on work to conduct a risk assessment amid concerns that costs could exceed the budget by $1 billion—an amount New Jersey could not sustain. Rumors circulated that funds might be redirected toward the Transportation Trust Fund; however, Transportation Commissioner James S. Simpson denied these claims.

On October 7, 2010, Governor Christie formally cancelled the ARC Tunnel project, citing escalating expenses and worries about New Jersey taxpayers shouldering an estimated $15 billion cost. He allowed a short extension to explore alternative funding options but ultimately terminated the project on October 27 following discussions with US Secretary of Transportation Ray LaHood.

At the time of cancellation, construction was underway on both the Tonnelle Avenue Underpass and Palisades Tunnels sections. The Manhattan Tunnels contract awaited award to Barnard-Judlau JV, while procurement for the Hudson River Tunnels contract was still ongoing.

Dispute over funding repayment

The project's termination resulted in the loss of federal funds and sparked scrutiny regarding expenditures by the Port Authority. In November 2010, U.S. Secretary of Transportation Ray LaHood consented to a plan for New Jersey to refund $271 million previously disbursed, with $128 million designated for the state's Congestion Mitigation Air Quality program to support upcoming initiatives. This proposal was declined by the Christie administration.

Subsequently, federal authorities insisted on full reimbursement of the grants in accordance with legal requirements. The Christie administration resisted and initiated litigation to avoid repayment. The Federal Transit Administration (FTA) demanded payment of $271,101,291 by December 24, 2010. To dispute this claim, New Jersey engaged the Washington, D.C.-based law firm Patton Boggs, incurring legal expenses surpassing $800,000 by April 2011.

Secretary LaHood cautioned that failure to comply could lead to suspension of federal funding for other projects. On April 29, 2011, the FTA ruled against New Jersey’s position, applying a 1% annual interest rate on the outstanding balance, which accumulated approximately $225,000 monthly. Governor Christie vowed to appeal the ruling through judicial channels.

By September 2011, NJ Transit and the FTA reached a resolution requiring New Jersey to repay $95 million. The settlement forgave $2.7 million in penalties and interest and stipulated that $128 million be allocated exclusively to transit projects approved by the Department of Transportation. The repayment was structured at $19 million per year over five years, with the $95 million recorded as a loss in 2011.

NJ Transit expenses, legal disputes, and resolutions

At the outset of the project in June 2010, NJ Transit paid an insurance premium totaling $162.7 million; out of this amount, $144.5 million was reimbursed. The remaining $18.2 million covered insurance expenses up until project termination.

In October 2012, NJ Transit was ordered to compensate $8.5 million for a property in Weehawken situated along the tunnel route; this sum was contested and ultimately reduced to $6.13 million.

Additionally, NJ Transit reached a settlement with Barnard/Judlau Joint Venture amounting to $5.6 million for completed design services and related documentation.

Government Accountability Office analysis

The Government Accountability Office (GAO) released a report in March 2012 entitled Commuter Rail Potential Impacts and Cost Estimates for the Cancelled Hudson River Tunnel Project. The report concluded that Governor Christie's justifications for cancellation were inaccurately portrayed, exaggerating projected costs, potential overruns, and New Jersey’s financial responsibilities.

The GAO determined there was no consensus regarding liability for cost overruns, disputing Christie’s assertion that New Jersey was solely accountable. While Christie cited figures up to $14 billion in costs, state officials had estimated approximately $10 billion prior to cancellation. New Jersey’s portion was roughly 14.4%, considerably lower than Christie’s claimed 70%, which factored in Port Authority funds and unrelated expenditures such as the $775 million reconstruction of the Portal Bridge.

Funds originally intended for ARC were redirected into New Jersey’s transportation trust fund, which is primarily supported by one of the lowest gasoline tax rates nationally.

Investigations by NJ Legislature, Manhattan DA, and SEC

In 2011, Governor Chris Christie instructed the PANYNJ to reallocate $1.8 billion initially designated for the ARC project toward highway improvements. These included refurbishing the Pulaski Skyway and Route 139, replacing the Wittpenn Bridge, and extending Route 1&9T—all vital elements of the Port of New York and New Jersey's logistics infrastructure. This funding shift reflected Christie's broader approach of using the bi-state authority’s resources to support New Jersey’s infrastructure needs, often extending beyond the agency’s standard responsibilities.

In February 2014, a joint committee from the New Jersey Legislature investigating the Fort Lee lane closure scandal issued subpoenas for PANYNJ documents related to ARC's anticipated budget overruns and appointments made by Christie. The following month, Manhattan District Attorney Cyrus Vance, Jr. subpoenaed records from PANYNJ concerning communications between agency officials and Christie's administration about major undertakings such as the World Trade Center site redevelopment and the PATH transportation hub. Vance’s office also examined funding related to the Pulaski Skyway’s rehabilitation. It was alleged that Christie's team pressured PANYNJ to designate the Skyway as an access route to the Lincoln Tunnel, thereby placing it under Port Authority jurisdiction despite its traditional exclusion.

By April 2014, reports surfaced that the Securities and Exchange Commission’s New York office was cooperating with the Manhattan DA in probing possible misappropriation of Port Authority funds. New Jersey State Senator Ray Lesniak called for investigations by both the SEC and IRS regarding whether diverting these funds violated securities or tax regulations. The SEC eventually imposed a $400,000 penalty on PANYNJ after the agency admitted to oversight failures. The investigation uncovered that Christie's administration had intended to redirect these monies before officially terminating ARC, aiming to prevent a transportation funding shortfall in New Jersey.

Gateway Project

In February 2011, Amtrak unveiled plans for a segment of a high-speed rail corridor known as the Gateway Project, which would also serve New Jersey Transit. This initiative targets a critical choke point in the national rail network, with its schedule accelerated partially due to ARC’s cancellation. Unlike ARC's deep-level station design, Gateway proposes a new southern terminal annex integrated within an expanded New York Penn Station complex. A newly constructed tunnel track will connect to existing Penn Station infrastructure to support Amtrak’s through-service trains on the Northeast Corridor.

The federal government officially approved Gateway on May 28, 2021. The Gateway Development Commission initially estimated completion by 2035 with a budget of $16.1 billion; however, delays have pushed this timeline back by three years and increased costs by $2 billion. The first contracts for construction were awarded in September 2023.

New York City Subway extension

On November 16, 2010, New York City Mayor Michael Bloomberg’s administration revisited plans to extend the IRT Flushing Line of the New York City Subway to Secaucus Junction, reviving earlier proposals that had stalled due to New Jersey commuters’ preference for direct "one-seat rides" into Manhattan. The existing 7 Subway Extension project extended service southwest from Times Square – 42nd Street to the newly opened 34th Street – Hudson Yards station on September 13, 2015. This station supports both the Hudson Yards Redevelopment Project and nearby venues like the Jacob K. Javits Convention Center.

If realized, this extension would represent the first time New York City Subway service crosses beyond city boundaries, offering direct rail connections from New Jersey into key Manhattan destinations such as Times Square and Grand Central Terminal, along with transfers to Queens and other subway lines. This subway expansion is anticipated to cost less than the canceled ARC tunnel since it would terminate at Eleventh Avenue rather than tunneling eastward to Herald Square—thus avoiding higher expenses. Although travel times may increase due to transfers at Secaucus Junction, riders would gain direct access to Grand Central Terminal—a feature ARC did not provide. However, capacity might be more limited compared to ARC’s multi-platform terminal design. Initial discussions with Governors Andrew Cuomo of New York and Chris Christie of New Jersey had not taken place; moreover, federal funds allocated for ARC would not automatically transfer to this project. Governor Christie expressed tentative support for this plan.

On February 2, 2011, New York City’s Economic Development Corporation committed up to $250,000 for a feasibility study on constructing a subway extension tunnel, awarding it to Parsons Brinckerhoff—the same engineering firm involved with ARC planning. The April 2013 report recommended an infill station at 10th Avenue, tunnels following ARC’s proposed route, and a multi-level multimodal facility at Secaucus Junction that considered widening the Northeast Corridor right-of-way. Mayor Bloomberg endorsed serious evaluation of extending the 7 train service into Secaucus; however, MTA director Joe Lhota cited financial limitations as an obstacle for near-term implementation.

In November 2013, representatives from the Real Estate Board of New York and Edison Properties advocated for extending the line through tunnels shared with the Gateway Project. That same month, the New Jersey Assembly adopted Resolution 168 endorsing subway expansion toward Hoboken and Secaucus. An economic impact analysis by the Meadowlands Chamber of Commerce was expected in spring 2015.

See also

• Empire Connection
• Florida high speed rail
• List of ferries across the Hudson River in New York City
• List of fixed crossings of the Hudson River (including bridges and tunnels)

External links

• Official ARCTunnel.com website
• N.J. Governor Christie reconsiders cancellation of tunnel project October 10, 2010
• Groundbreaking for the United States' largest transit initiative June 8, 2009
• TTF funding proposals from 2006
• Could tunnels canceled by Christie have resolved NJ Transit’s challenges?