XanaduStately pleasure dome or boondoggle? Xanadu gets a new name, and a new chunk of state money.Photo: Pro PublicaNew Jersey Gov. Chris Christie has been quite literally making a federal case out of his refusal to return funding for the ARC Tunnel. Slated to be one of the biggest public works projects in the country history, this rail tunnel between New York and New Jersey died with a whimper last year when Christie pulled his state’s support, citing concerns about potential cost overruns. Now he is saying that if the feds want back the $271 million they have sunk into the project, “they’re going to have to come get it.”

The state has already run up an $800,000 tab with a Washington law firm in the matter.

The Republican governor, who has repeatedly denied interest in the 2012 presidential race, has used his hardline stance on the ARC project to boost his image as a fiscal tough guy.

But when it comes to the long-stalled Xanadu megamall in New Jersey’s Meadowlands, a project backed by his Democratic predecessors that has sucked up tons of state money and had its opening date pushed from 2007 to 2013, Gov. Christie gets a lot more cuddly.

According to an article in The New York Times, Christie is recommitting the state to the completion of the project, which has been plagued for years by — you guessed it — cost overruns, and which Christie himself once called a “failed business model.”

Much bigger and more expensive, but less gaudy: Gov. Chris Christie and developers laid out a new vision on Tuesday for completing and expanding the vast retail and entertainment complex formerly known as Xanadu in the Meadowlands….

“It’s finally going to move forward now,” Mr. Christie said of the project, which has already burned through $1.9 billion and two developers, each of whom ran out of money….

The state has already spent, by some accounts, as much as $1 billion on financing, tax breaks and highway improvements to support the development.

The state will provide about $200 million in financing to [the latest developer,] Triple Five, and Mr. Christie has said that in return for such aid, the state must share in the benefits if the project succeeds.

The governor declined to say on Tuesday what financial arrangements would be made, but said, “we will get our investment back, and then some.”

That was disputed by Jeff Tittel, director of the New Jersey Sierra Club, who said the developer should be paying the state, which owns the land, rather than the other way around. He raised concerns about traffic and other environmental consequences of the project, adding, “New Jersey needs another mall like we need another Superfund site.”

Xanadu has a new “Mall 2.0″ name, American Dream@Meadowlands. That might make people forget the long and tortured history of the project. Or it might not. There is some indication that enclosed malls, especially ones that are marketed as entertainment centers, are weathering the economic downturn relatively well. (Unless they’re in China.)

At any rate, Christie is betting quite a lot on this, politically. From the Times:

Brigid Harrison, a professor of political science at Montclair State University, said, “The idea that Xanadu, which has such a reputation for being a boondoggle, is worthy of state investment — it’s antithetical to what Christie says the role of government is.” But Dr. Harrison said that the governor had no good options, and that voters would approve of his actions if construction resumed, the exterior became more attractive, jobs were created and the mall opened.

That’s a lot of ifs.