THE GATEWAY PROGRAMECONOMIC BENEFITS AND FUNDING PARTNERSHIPS

Washington, DC – June 7, 2018

Presented By:

Marie Corrado – Amtrak, Senior Director, Gateway Program

Gateway -The Most Urgent Infrastructure Program in America

• Busiest section of NEC is between Penn Station New York & Newark, NJ (450 trains, 200k trips/day) constrained by two-track bottleneck

• North River Tunnel, Portal Bridge & other infrastructure dates to early 1900’s

• PSNY regularly operates at capacity (1,300 train movements daily on 21 tracks)

• Capacity constraints + aging infrastructure = risk to 10% of U.S. GDP

• Superstorm Sandy accelerated degradation of these assets

The Gateway Program: Economic Benefits and Funding Partnerships 2

Gateway Program Overview Map

Gateway Program Benefits Far Exceed Costs

• A benefit cost analysis found the benefits of the Gateway Program greatly exceed its costs even under the most conservative discount rate assumptions.

• Gateway compares favorably to other major infrastructure projects across America and internationally.

Gateway Program (2025-2058)

7% Discount Rate 3% Discount Rate

Benefit Cost Ratio 2.16 3.87

Project BCA Ratio / Range

Gateway Program 2.16 – 3.87

London’s CrossrailProject

2.59 – 3.64

California High Speed Rail

2.23 – 2.35

The Gateway Program: Economic Benefits and Funding Partnerships

Source: The Economic Benefits of Investment in the Gateway Program. 2016. https://nec.amtrak.com/resource/gateway-program-economic-benefits-report/

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Benefits Included in Benefit Cost Analysis

Reduced Travel Time

Reduced Travel Cost

Emissions Reductions

SafetyAvoidance of lost productivity from

foregone trips

Reduced highway congestion

Travel reliability (rail)

Reduced in-vehicle crowding (rail)

Disruption avoidance (during

tunnel rehab)

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Job CreationMunicipal and

State tax Revenues

Property Values

Personal income

Induced office space

development

Other wider economic benefits

Benefits Not Included in Benefit Cost Analysis

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Rendering of the replacement bridge – “Portal North” –a high-level fixed span bridge

Existing Portal Bridge in open position

Portal North Bridge Project

• Existing swing bridge nicknamed Achilles heel of NEC

• New bridge design complete, ROD and permit on hand

• Early works construction contract awarded in August 2017

• Single construction contract for full build of the bridge in the pipeline for award early 2019

• New network tied arch bridge scheduled for completion in 2025/26

• Financial plan pending approval

7The Gateway Program: Economic Benefits and Funding Partnerships

Urgency: Portal Bridge Failures

Portal Bridge Service Disruption - Friday, March 16, 2018 Impact

• NJ TRANSIT and Amtrak• 112 cancelled trains

• 34 delayed trains

• ~66,000 passengers directly affected

• Affected Customers:• NJ TRANSIT customers traveling throughout the system

• Amtrak customers traveling on:

• Acela Express, Northeast Regional, and Keystone Services

• Trains to North Carolina, Georgia, and Chicago (with stops in cities such as Charleston, SC, Fayetteville, NC, Indianapolis and Cincinnati) also affected.

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Hudson Tunnel Project

• Construction of new two-track Hudson River tunnel connecting to Penn Station NY in order to rehabilitate existing two-track North River Tunnel while preserving NJ TRANSIT and Amtrak services without interruption.

• 30 Percent Design and Engineering complete. • Awaiting Federal Agency review and USDOT sign-off

on Record of Decision. • Local financial commitment secured. • Resubmission of Federal CIG Application pending.

9The Gateway Program: Economic Benefits and Funding Partnerships

Urgency: Superstorm Sandy Impacts

• 2012 Superstorm Sandy forced ~4-day closure of the NEC:

– Inundated substations

– Inundated East River and Hudson River Tunnel

• Precipitated damage to internal components

• Reconstruction requires closure of each tube for ~1.5 years to complete renewal work

• Rehabilitation of the North River Tunnel can only begin after new tunnel is completed

10The Gateway Program: Economic Benefits and Funding Partnerships

Gateway Program Development Corporation

• Incorporated November 2016 in State of New Jersey as nonprofit corporation

• Will effectuate planning, funding/financing, construction and delivery of the Gateway Program

• Trustees representing Amtrak, State of New Jersey, State of New York.

• Interim staff from partner agencies, CEO search in progress

• Opening office in Newark, NJ in June 2018

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Financial Submissions to USDOT

• The Gateway Program Partners are seeking federal grants and federal loans repaid by local cashflows

Hudson Tunnel Project

Portal North Bridge Project

Submission Type Month/Year StatusFTA Grants Sept./Dec.

2017• FTA rating did not account for the December ‘17 submittal• Follow-up information in development

Local/ USDOT RRIF Loan Documentation in development based on FTA Grant Submittal

Submission Type Month/Year StatusFTA Grants Sept. 2016 • FTA “Medium-High” Rating

FTA Grants Sept./Dec. 2017

• FTA rating did not account for the December ‘17 submittal• Follow-up information submitted & in development

Local/USDOT TIFIA Loan Sept. 2017 • USDOT BAB Feedback received March 2018• Follow-up information in development

The Gateway Program: Economic Benefits and Funding Partnerships

Taking Action to Expedite and Advance Phase 1 Projects

• Delays to both Phase 1 projects can cause cost escalations that are costly to everybody – therefore GDC and its partners are taking action to expedite construction of Phase 1

– New Hudson Tunnel: $1.2 million/day (starting mid-2019)– New Portal North Bridge: $150,000/day (starting mid-2018)

• Critical Early Work and Funding:– Portal North Bridge Early Work: Utility Relocation & Site Access– Hudson Yards Concrete Casing – Section 3: LIRR ESB Utility Relocation– $31.5 M committed by PANYNJ to match Amtrak’s contributions for engineering, design, and

program management services

• Continuing to Leverage Private Sector Industry Feedback– Continuing industry engagement with new RFI for private sector feedback in summer 2018.

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Hudson Yards Concrete CasingRight of Way Preservation

Section 2Construction Complete

$50 m Sandy Relief$5.5 m – NJ TRANSIT

$5.5 m LIRR$5.5 M Amtrak

Section 3$25m for Early Work

(Amtrak/Port Authority)Fully permitted & designed

Add’l funding needed

Section 1Construction Complete$185m – Sandy Relief

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Hudson Yards Concrete CasingConnection to Penn Station New York

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Thank You!