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Feds start charging interest and penalties on $271 ARC debt owed by NJ
A year after Governor Christie shut down a Hudson River rail tunnel project, New Jersey’s debt to the Federal Transit Administration has grown to nearly $274 million.
NJ Transit had already sunk $271 million in FTA money into the Access to the Region’s Core mass-transit tunnel project when Christie halted construction last October. He said he didn’t want taxpayers saddled with a potential $5 billion in cost overruns.
But the FTA, which had been heavily invested in the $8.7 billion project, demanded its money back. Now it’s charging the state interest and penalties.
Interest began to accrue on the debt on May 14 at a rate of 1 percent a year, while additional penalties began to accrue on Aug. 13 at a rate of 6 percent a year. As a result, New Jersey now owes the FTA more than $958,139 in interest and $1,693,455 in penalties on top of the original $271 million. (Rouse, The Record)