Seeking to “ensure transparency and accountability” in the $8.7-billion effort to build a new commuter rail link under the Hudson River between New Jersey and Manhattan, Gov. Jon Corzine (D-N.J.) has issued an executive order mandating more state oversight of spending and contracting.

Slide Show

Photo: New Jersey Transit

Expanding rail-line terminus is one part of project to run more trains between New York and New Jersey.

As the country’s largest transit public-works project, the rail link includes construction of two commuter tracks and requires 8.78 miles of tunneling. The project officially broke ground in June and is to be completed in 2017. It will add capacity to an existing commuter rail tunnel, built in 1910 (see diagram, slide 3). The project is receiving about $130 million in American Recovery and Reinvestment Act funds and is projected to provide 6,000 construction jobs a year.

The Oct. 7 directive by Corzine, who is locked in a tight re-election campaign, takes effect immediately. It orders the newly formed independent state comptroller’s office to monitor contract procurement by a key project owner, New Jersey Transit. That agency has primary responsibility to manage project design, construction and equipment procurement. Other funding partners and project participants include the Port Authority of New York and New Jersey, the U.S. Dept of Transportation and its Federal Transit Administration.

New Jersey’s budget and its politicians have been buffeted in the last several years by cost overruns and allegations of mismanagement and fraud in execution of the state’s last large construction program: the court-ordered reconstruction and expansion of hundreds of public schools.

That program, which began in 2000 with close to $9 billion in funding, ran out of money two years ago and is struggling to complete work on its original list of schools, mostly located in poor urban areas of the state. The problems forced the state to restructure the original management agency and cancel or scale back many projects.

The executive order comes as project construction procurement for the trans-Hudson tunnel revs up. Price proposals from three joint-venture teams that were prequalified last June to bid on the project’s first big design-build contract, for tunneling work on the Manhattan side, are due on Oct. 21.

The estimated $500-million contract includes construction of 19,000 ft of 24.5-ft-dia bored tunnels through hard rock and related work. About 1.67 million cu yd of hard rock and other material will be excavated in New Jersey and Manhattan.

Prequalified teams for the Manhattan work are ARC Constructors, a Pearl River, N.Y.-based joint venture of S.A. Healy, CCA Civil and Halmar International; a Secaucus, N.J.-based joint venture of Schiavone Construction Co., Skanska Civil and J.F. Shea; and a team of Judlau Contracting Inc. and Barnard of New Jersey Inc., a unit of Barnard Construction Co. Inc., Bozeman, Mont.

Those three teams and an additional joint venture of OHL USA Inc., Davie, Fla., and Tully Construction Co., Flushing, N.Y., also were prequalified on Aug. 28 to proceed for the estimated $250-million design-build contract to build the Palisades Tunnels on the New Jersey side. Price proposals for that work are due in mid-December, says a New Jersey Transit spokesman. The scope includes twin bored tunnels, 5,200 ft long, running through the Palisades rock formation to an access shaft in Hoboken. Teams are holding required outreach meetings for certified disadvantaged business enterprises between Oct. 14 and Oct. 29.

Prequalification for a third and final contract, estimated at $500 million and called the Hudson Tunnel contract, is to begin later this year. It will involve construction of 7,500 ft of soft-ground tunnels beneath the river.

Corzine’s executive order authorizes the comptroller to review internal and external audits of the transit project to determine whether more oversight is needed to keep it “within budget” and requires “action plans” from New Jersey Transit if schedule and budget targets are or could be missed. It did not elaborate on new procurement enforcement steps, but a New Jersey Transit spokesman says tunnel project managers “have been working closely with the Office of Comptroller for more than a year” and are already providing similar information to the federal agency partners.

One source close to the project says officials have not publicly cited the school construction issues as the impetus behind the tunnel project’s tight oversight. But, he says, “Everyone is going overboard on prevention to avoid cost growth and any possible fraudulent activity.”