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It's Time For NJ To Pay Up For Cancelled Tunnel

TRENTON, NJ (AP/CBS New York) -Lawyers for New Jersey were expected to take nearly all the time available Tuesday to respond to the federal government's demands to reimburse it for costs associated with canceled plans to build a new rail tunnel under the Hudson River.

The Federal Transit Authority set a deadline of midnight Tuesday for the state to either send Washington $271 million or file a formal appeal.

Michael Drewniak, a spokesman for Gov. Chris Christie, said the state's lawyers will respond in time. But he wouldn't say whether New Jersey would be sending a check or an appeal.

Federal authorities say the state owes it for engineering and construction work done on the tunnel before Gov. Chris Christie canceled the project in October, saying New Jersey was going to have to foot too much of the bill, including any costs above the $8.7 billion budget.

Christie, a Republican who has slashed state spending, said the extra costs could have added up to between $2 billion and $5 billion.

At the time, it was the most expensive public works project in the country. The tunnel was intended to double the capacity for trains traveling between New York City and New Jersey, routes that are now close to capacity and frequently delayed.

Christie's administration so far has resisted paying the back the federal government, and hired a law firm known for lobbying to try to get out of the bill.

The federal government says $128 million would be credited back to the state to ease traffic jams once the state pays in full.

(Copyright 2011 by The Associated Press.  All Rights Reserved.)

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