August 4, 2000 Study Backs Freight-Train Tunnel in New York Harbor By
THOMAS J. LUECK

A proposed rail-freight tunnel under New York Harbor that Mayor Rudolph
W. Giuliani has adopted as a favored project would cost up to $2.3 billion
but would pay for itself through increased business along a revitalized
Brooklyn waterfront, according to a city study.

The two-year study by the New York City Economic Development Corporation
recommends that a tunnel be built connecting Bay Ridge, Brooklyn, and
either Staten Island or Jersey City, linking New York to the existing
rail-freight network in the rest of the country.

The report also says that a harbor tunnel could reduce the number of
large commercial trucks that enter New York City -- mainly over the George
Washington and Verrazano-Narrows Bridges -- by almost a million a year.

Since such a huge project would take at least a decade to complete, the
report suggests that barges be used to carry freight across the harbor
to and from Brooklyn in the interim.

The report was completed in May, but it has been released only to
technical advisers and elected officials.

Mayor Giuliani has been urging the construction of a tunnel under the
harbor for years, and the idea has been around since the 1920's. Critics
say the tunnel is too expensive and faces huge hurdles because of its cost
and the layers of review by the federal and state agencies responsible
for New York Harbor.

But the report by the Economic Development Corporation supports the
project. ''This two-year study confirms that a new, direct rail-freight
link would have dramatic positive impacts,'' it concludes.

The proposal faces difficult political hurdles not directly addressed
by the report. Gov. George E. Pataki, who controls how federal aid
for transportation projects is parceled out around the state, said in
January that he would not join Mayor Giuliani in pushing for a harbor
tunnel until seeing the results of the city study.

Yesterday, Joseph Conway, a spokesman for the governor, said Mr. Pataki
was ''still reviewing the findings'' and would not comment.

Supporters of the project say it would also hinge on the support of the
Port Authority of New York and New Jersey, which controls the shipping
terminals in the harbor and the bridges that carry most truck traffic
into the city. One recommendation in the report on financing a tunnel
is for the Port Authority to impose a 35 percent surcharge on the tolls
now charged commercial trucks coming into the city.

''Until we finish reviewing the whole report, we can't offer any
conclusions,'' said Steven Coleman, a Port Authority spokesman.

Despite its detailed analysis of projected benefits, the city's report
did not alter skepticism from some experts in transportation and economic
development, who said a rail tunnel might be outmoded by the time it was
built. They pointed to the heavy demand by freight carriers for existing
railroad tracks in New Jersey and elsewhere, which may not leave enough
room to divert much of the cargo now trucked to and from the city.

''You are making a very large bet on what the freight market will be
like 10 to 15 years down the road, and if you guess wrong, you blow
the money,'' said Hugh O'Neill, an economic consultant and co-author
of a New York University report in December that argued against Mayor
Giuliani's proposal for the tunnel.

Aides to the mayor, who has not discussed the report publicly and was
attending the Republican National Convention in Philadelphia yesterday,
said that the report remained under review at City Hall.

''We are reviewing it with an eye toward what would be best for the
city,'' said Janel Patterson, a spokeswoman for the Economic Development
Corporation, whose president, Michael Carey, declined to be interviewed.

But the report, paid for by a $3 million federal grant and $2 million
from the city, seemed likely to encourage the elected officials, urban
planners and others who staunchly back the tunnel project.

''This gives real substance and real empirical evidence'' to the benefits
of the project, said Representative Jerrold L. Nadler, who has long been
a proponent of a harbor tunnel as a means of reducing truck traffic and
providing rail access to the Brooklyn waterfront.

He envisions the tunnel as a link to a re-energized port terminal in
Sunset Park, with the deep water off the Brooklyn waterfront enabling
the terminal to be used by a new generation of deep-draft cargo vessels
that cannot navigate the shallower channels leading to ports on Staten
Island and in New Jersey.

The two-year study, which the city said incorporated detailed analyses by
several engineering firms, focused on two paths for the proposed tunnel,
each linked to the little-used 65th Street freight yard in Bay Ridge. From
there, the tunnel would be dug under the harbor to freight-rail links on
Staten Island or in Jersey City. In either case, a tunnel would provide
connections to the national freight-rail network.

Cost estimates in the study are provided for tunnels wide enough to
accommodate one track or two. They range from $1.4 billion to $2.3
billion.

The cost projections include work that would be required to heighten
overpasses and upgrade idle rail tracks in the city, enabling trains to
travel from Bay Ridge to the Bronx or to make a connection to Long Island.

The report projected the cost of a new system of freight-carrying barges,
which could cross the harbor from several docks in Brooklyn and New
Jersey and on Staten Island, at $150 million.

Cargo handling by barge was common in New York Harbor until the early
1960's, but has since all but died away. The report said a new system
was necessary as an ''essential building block'' to foster economic
activity until the proposed tunnel was built.

While offering no direct recommendation on financing the project, the
study said alternatives in which private investment paid the bulk of
the cost should be explored. It said freight carriers would be charged a
fee to use the tunnel and that space could be sold for use by electrical
utilities, which would lay cables, or by fiber optics companies.