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Posted at 3:25 PM ET, 12/ 9/2010

NJ Transit hires Patton Boggs

By Associated Press and Staff Reports

3:22 p.m. Update: NEWARK, N.J. -- The adage says spend money to make money, but NJ Transit is hoping to spend money to save money -- specifically, the $271 million the federal government has demanded as repayment for the canceled rail tunnel project into Manhattan.

NJ Transit's executive board on Thursday approved the selection of Patton Boggs to challenge the Federal Transit Administration's tab.

The measure passed unanimously minus the vote of state Transportation Commissioner James Simpson, who recused himself because he is a former head of FTA.

NJ Transit Executive Director James Weinstein defended the selection of Patton Boggs LLP, a firm with experience in large-scale construction projects and government contracts. In addition to the attorneys' rates of $485 an hour, clerks and assistants at the firm will be paid $125 an hour and paralegals $90 an hour, according to Weinstein.

"We're fighting to keep $271 million. Whatever we pay the law firm is far less than what the federal government is asking us to pay them," he said.

On Oct. 27, Gov. Chris Christie halted what was the nation's most expensive public works project because of potential cost overruns he said could total $2 billion to $5 billion or more.

The federal government and the Port Authority of New York and New Jersey each had committed $3 billion to the $8.7 billion project. New Jersey's portion was $2.7 billion, and the state and Port Authority were responsible for overruns.

The project to construct a second rail tunnel was projected to double train capacity between New Jersey and New York. When Christie pulled the plug, more than $600 million had been spent for engineering, construction and environmental studies.
The FTA sent New Jersey a bill on Nov. 24 for its $271 million share, payable within 30 days.

"We feel that the position the government is taking is not nearly as clear as they'd like to think it is," Weinstein said. "We feel very strongly about this and are going to pursue it."
Weinstein didn't say what projects would be affected if the state is forced to pay back the entire $271 million, but noted that the amount represents a significant chunk of the agency's $3 billion budget.

Earlier this year, NJ Transit trimmed executive salaries, cut service and raised fares as much as 25 percent to address a $300 million budget shortfall.

Original post: New Jersey is expected to take another step to fight a $271 million bill for the scuttled Hudson River rail tunnel.

New Jersey Transit's board of directors on Thursday is set to consider whether to hire D.C. law firm Patton Boggs. The firm would be paid $485 per hour to challenge the Federal Transit Administration's tab.

The bill came after Gov. Chris Christie killed the $8.7 billion rail link from New Jersey to New York City on Oct. 27, citing potential cost overruns. The Federal Transit Administration's chief financial officer sent an invoice to NJ Transit's executive director Nov. 24, with the payment due within 30 days.

The governor's office said the FTA has not demanded repayment for other projects that have been stopped.

The tunnel had been the most expensive public works project under way in the nation.

The Northeast Corridor has grown increasingly congested for train traffic, and Amtrak has been studying whether there was a need for yet another tunnel between New Jersey and New York City -- in addition to the project that Christie stopped. Rail ridership between Washington and Boston is expected to double by 2030.

Related stories:

New Jersey has 30 days to pay transit bill

Amtrak considers reviving tunnel

New Jersey governor kills rail tunnel

By Associated Press and Staff Reports  | December 9, 2010; 3:25 PM ET
Categories:  Transportation News  
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