Feds tacking interest to scrapped N.J. rail tunnel

Officials say New Jersey owes the Federal Transit Administration nearly $274 million for the Hudson River rail tunnel project that Gov. Chris Christie scrapped nearly a year ago.

That figure includes more than $2.6 million in interest and penalties that the FTA is tacking on while the Christie administration fights repayment, the AP reports.

Taxpayers have paid more than $1 million to a Washington law firm that is challenging whether the state needs to give the money back.

NJ Transit spokesman Paul Wyckoff says attorneys “are still negotiating” to have the debt reduced. Wyckoff says the agency is focused on minimizing the costs to citizens.

Christie halted the tunnel in October because he feared taxpayers would be saddled with a potential $5 billion in cost overruns.