Having closely followed the debate over ARC some months ago, a subject we’ve addressed in this space, I was distinctly unimpressed by the new GAO report. Kate Zernike reports that the GAO is contesting several of the claims Gov. Chris Christie (R-NJ) advanced when he announced that he would withdraw his support for the tunnel. The following is drawn from Zernike’s article:

The report by the Government Accountability Office, to be released this week, found that while Mr. Christie said that state transportation officials had revised cost estimates for the tunnel to at least $11 billion and potentially more than $14 billion, the range of estimates had in fact remained unchanged in the two years before he announced in 2010 that he was shutting down the project. And state transportation officials, the report says, had said the cost would be no more than $10 billion.
Mr. Christie also misstated New Jersey’s share of the costs: he said the state would pay 70 percent of the project; the report found that New Jersey was paying 14.4 percent. And while the governor said that an agreement with the federal government would require the state to pay all cost overruns, the report found that there was no final agreement, and that the federal government had made several offers to share those costs.

So was this an egregious misrepresentation on the part of the governor?

Mr. Christie’s estimates of several billion dollars in cost overruns refers to an $8.7 billion estimate that was used for a grant agreement between the federal government and the state to get the project started in early 2009, and was often referred to in news accounts as the price tag on the project. But the federal report noted that federal and state officials, including those in Mr. Christie’s administration, had long been preparing for the possibility that costs might range from $9.5 billion to $12.4 billion. Mr. Christie’s administration, however, argued that the upper estimates were excessively cautious.
A spokesman for the governor, Michael Drewniak, said Mr. Christie’s statement of costs had included $775 million to build a new portal bridge, which was required as part of the project. The 70 percent state share, he said, included the costs that would have been paid for by the Port Authority of New York and New Jersey, which is run by both states, as well as federal highway and stimulus funds earmarked for New Jersey. Counting those costs, which the report does not do, would put the state’s share at 65.5 percent.

Including the cost of the new portal bridge, which was essential to ARC, seems reasonable, as does accounting for the costs to the Port Authority, though perhaps the share might have been modified to account for the fact that taxpayers from both regions are ultimately responsible for it.

There were far more cost-effective alternatives to ARC. We discussed one of them in November of 2010 — an extension of the No. 7 subway line that would cost $5.3 billion, or less than half the cost of ARC while also allowing far more passenger throughput. Yonah Freemark explained the potential advantages and disadvantages of this approach at the time. In light of the planned Hudson Yards project, the case for an extension seems quite strong. Yet there has been little interest in pursuing it:

The governor said when he canceled the project that he hoped New York City or federal officials would find another solution But last week, the chairman of the Metropolitan Transportation Authority said one of those, a proposed extension of the No. 7 subway line to New Jersey, was not going to happen “in anybody’s lifetime.”

This makes intuitive sense in light of the MTA’s fiscal woes and the ambition of its existing capital projects. What isn’t clear is why some share of the funds that would have been devoted to ARC by the federal government and the Port Authority, etc., shouldn’t be devoted to a subway extension that would achieve a higher level of interoperability and that wouldn’t require extensive new tunneling in Manhattan.

So far, at least, Gov. Christie doesn’t seem to have suffered much from what increasingly looks like a pseudo-controversy.