The times we live in are changing so rapidly that such changes are outpacing our ability to formulate policies to cope with the consequences of those changes. Accordingly, we are always behind the curve.
Think about it: you pick the sector; Energy, Healthcare, Telecommunications, Financial Services, whatever. The changes occurring, economic or otherwise, are not incremental or marginal, they are systemic and transformational. They are often disconcerting, dramatic and complex. Yet, we keep applying old policies to new problems, where they do not fit...and they do not lead us to solutions. Nothing seems to work!
There is no better example of this than the inadequate funding of our country's infrastructure, in general, and for the Gateway Railway Tunnel Project, in particular. That this tunnel, connecting New York and New Jersey and located in the center of the Northeast Corridor, is `a major national asset is unquestioned, supporting a contribution of some 20 percent of our Nation's Gross Domestic Product. The facts are that Amtrak needs $30 billion to fund the Gateway Project, and neither they nor the States of New York or New Jersey, nor the Federal government, can or will fund that kind of money. This can has been kicked down the road for too many years, now. To add insult to the conundrum, per Amtrak, if we do not want to have a pristine new tunnel feeding into "two streaks of rust converging in the distance" at either end of Gateway, Amtrak needs another $40 billion to bring the Northeast Corridor's infrastructure up to a state-of-good-repair...a condition the Northeast Corridor has not seen since 1981. Without this funding, we will continue to witness rail disasters and loss of life, as well as the eventual shutdown of the trans-Hudson tunnels and the Corridor.
Hearings have been conducted at all levels of government...press conferences have been called by anyone who can command attention. Seemingly, the problem is generally recognized by Congress, but little, if any, progress has been made. Meanwhile, the public has become more and more concerned about its safety and the ineffectiveness of government and promises lost. The answer is that we have to stop talking to people as children and speak truthfully about the unavailability of public funding. Simply put, there is not enough public money available to fund our multi-trillion dollar critical infrastructure needs! Let's acknowledge that the Gateway Project won't be adequately funded by tax revenues from New York, New Jersey or the Federal Government.
Times and revenue expectations have changed dramatically. We need to not only "think out of the box" but also create a new box! One alternative is the public-private partnership (P3), a structure that allows public entities to leverage their assets and infrastructure to obtain private sector capital for public investment purposes. New Jersey colleges and universities have been successfully using this model for years. In light of a 40 percent reduction in State Aid to Higher Education and their resulting inadequately funded capital needs, educational institutions have resorted to P3 financing. They contribute their assets, land and infrastructure in return for private capital to build dormitories, classrooms and research facilities, etc. And a developer gets the right to build profitable retail and commercial facilities, as well as market rate housing. It is a mutually beneficial fair deal.
Governor Murphy recently signed into law an expansion of this concept to apply to transportation facilities/agencies, such as New Jersey Transit. I see no reason why the Gateway tunnel, which is owned by Amtrak, could not be funded in the same manner.
There is active interest among the private investment community in such a project. One, called AIRNet-21, is a legislative proposal which has been advanced that is deserving of close scrutiny, in that it purports to provide guaranteed long-term funding for the tunnel and Amtrak's network infrastructure needs, including backlog. AIRNet-21 functions as a trust and operates, as a government tenant, an Infrastructure Management Organization (IMO). The AIRNet-21 plan is accountable to the public and subject to public oversight; immediately funds Amtrak's infrastructure needs; does not involve privatization; realizes good governance; protects labor; and allows Amtrak to do what it does best.
As former Chairman of the House of Representative's Sub-committee on Commerce, Transportation and Tourism, under the aegis of which Amtrak was created, I helped birth Amtrak. I do not want to be a passive observer of its demise. The time to be real with our expectations is now, rather than be unable or unwilling to accept harsh fiscal realities...or, alternatively, awaiting the tunnel's catastrophic collapse. Fresh thinking is required. Public-private partnerships for infrastructure funding is an idea whose time has come and AIRNet-21 is a workable solution.
James J. Florio, Esquire
Founding Law Partner, Florio Perrucci Steinhardt & Cappelli, LLC
49th Governor, State of New Jersey