New Jersey Governor Chris Christie.Chris Christie.Photo: Chuck WalkerNew Jersey Gov. Chris Christie has killed the so-called ARC Project, a rail tunnel that would have been the largest public works project in the United States.

[Update 10-8: Actually, maybe not. After a meeting with Transportation Secretary Ray LaHood, Christie now says he’s reviewing options.]

The move had been rumored ever since a moratorium was declared on new work last month, and Christie announced his final decision to pull state funding from ARC this afternoon.

“The ARC project costs far more than New Jersey taxpayers can afford and the only prudent move is to end this project,” said the governor in a press release.

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ARC (it stands for “Access to the Region’s Core”) had been in the works for 20 years and was slated to cost $8.7 billion, a pricetag that was to be split between the federal government, the Port Authority of New York and New Jersey, and the state of New Jersey. It would have created a new rail tunnel under the Hudson River — doubling commuter rail capacity between New Jersey and New York, one of the most heavily traveled and economically vibrant corridors in the nation. It would also have created 6,000 jobs annually. (Here’s some audio from the hopeful groundbreaking a year ago.)

Christie, who unseated incumbent Democrat Jon Corzine on a no-new-taxes platform in 2009, has said he wants to focus on repairing New Jersey roads, and that there simply isn’t enough cash to do everything.

New Jersey is certainly in big trouble when it comes to its transportation budget, but the option of having road users pay anything more in gas tax for those repairs seems to be off the table. Here’s how the The New York Times put it today:

The state’s Transportation Trust Fund, which is financed by the state’s tax on gasoline, is running dry. Transit advocates and environmental groups argue that the simple solution is to raise the gas tax, the first increase since the late 1980s. They point out that the state’s taxes on gas amount to just 14.5 cents a gallon — lower than in all but three other states — and that every extra penny would translate to another $50 million annually.

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But Mr. Christie, who had pledged not to raise any taxes, has steadfastly refused to consider that option, leaving the state’s transportation commissioner, James Simpson, with few options to replenish the transportation fund.

Sen. Frank Lautenberg (D-N.J.) warned that the state could end up having to pay some $300 million back to the federal government for work that has already been done.

Christie’s refusal to invest in a piece of major public transportation infrastructure echoes the resistance to spending on inter-city rail that many Republican gubernatorial candidates have expressed this election season. We wrote about that yesterday.

And, as in those cases, Republican electeds who had backed rail projects — and the federal dollars and jobs they represent — are suddenly getting cold feet. From the Times:

The [ARC] project had been supported by business leaders and elected officials in New York and New Jersey, including some Republicans, like Representative Rodney Frelinghuysen, who lists the tunnel as one of his “key mass transportation initiatives.” Though the project has been lauded as an exceptional example of bipartisan cooperation, no Republicans have spoken out against the prospect of its suspension or demise.

On Wednesday, Mr. Frelinghuysen said in a statement that he supported Mr. Christie’s reconsideration. “We need to answer some key questions such as, ‘Can we afford this project?’ and ‘Does it make sense?’ ” Mr. Frelinghuysen said.

Before Christie’s final announcement, Times columnist Paul Krugman wrote this on his blog about a move to kill the tunnel:

[It’s] arguably the worst policy decision ever made by the government of New Jersey — and that’s saying a lot. …

And it’s a social bad too: now is very much the time when we should be ramping up infrastructure spending, not cutting it.

Christie’s move reinforces the perception that the current political climate means ambitious infrastructure projects serving American cities are an impossible dream. Meanwhile, in places like Shanghai, governments are investing in transit systems that will serve citizens for generations to come.

This just in: Transportation Nation reports that U.S. Department of Transportation Secretary Ray LaHood will meet with Christie tomorrow to “discuss a path forward on the ARC project.” More to come.

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