The anticipated AirTrain project at Newark Liberty International Airport has exceeded its initial budget by $1.45 billion, bringing the total cost to $3.5 billion.
On Thursday, the Port Authority of New York and New Jersey approved a significant funding increase of over 70% for the AirTrain EWR project. Originally budgeted at $2.05 billion, the project aims to replace the outdated train system that serves more than 30,000 daily passengers at the busy metropolitan airport.
The expanded budget accounts for inflation and setbacks caused by the COVID-19 pandemic, as outlined in a statement from the agency. Additional factors, such as heightened risk contingencies for large-scale infrastructure endeavors and supply chain disruptions, have further inflated the costs.
Warnings about the rising expenses associated with the AirTrain were issued by Port Authority officials last year. Similar challenges, including increased labor and material costs, impacted a separate upgrade project at John F. Kennedy International Airport, which saw its budget swell by $1 billion to nearly $4 billion in early 2023.
Jim Heitmann, the Port Authority’s chief operating officer, noted that the pandemic-induced pause in development contributed to the ballooning costs. He remarked during a board meeting, “Within those five years the world experienced this unprecedented rate of inflation. There was an unprecedented higher increase particularly on construction contracts and then on top of that, extra-sharp risk premiums on these mega projects over a billion dollars.”
The Port Authority has finalized a $1.2 billion contract with a joint venture between Tutor Perini Corp. and O&G Industries Inc. to design and construct the new system. The project includes a 2.5-mile elevated rail line and the development of three new AirTrain stations. According to the agency, 80% of the multi-phase procurement process has already been completed.
The AirTrain is a critical transit link, connecting airport terminals to rental car centers, hotel shuttles, parking areas, and rail lines operated by New Jersey Transit and Amtrak.
The revised budget will be partially offset by delaying spending on the PATH rail-extension project and other initiatives within the Port Authority’s capital program through 2026.
As part of its broader infrastructure strategy, the Port Authority has proposed a $9.4 billion budget for 2025, allocating approximately $3.6 billion for capital improvements. This plan also includes a 25-cent increase in tolls for bridges and tunnels.
Construction on the new AirTrain is expected to commence in 2025, with the system projected to be operational by 2030.
{Matzav.com}