Amtrak inspector general cites communication and document management risks on Hudson Tunnel Project

An audit by Amtrak’s Office of Inspector General released this month identified three areas for improvement in Amtrak’s role in theHudson River rail tunnel program, including a $104 million refund owed to Amtrak that was not known to the project team, clearer definition of Amtrak’s responsibilities, and more consistent document management. The 32-page report followed an 18‑month review with work from offices in four states, site visits, examination of more than 650 documents, and interviews with over 100 participants in the $16 billion effort to construct a new two‑tube tunnel under the Hudson River and rehabilitate the existing two‑track tunnel that is over 100 years old. The report was addressed to Laura Mason, Amtrak’s executive vice president of capital delivery, who agreed with the suggestions. Construction of the new tunnel is not expected to be completed until 2035, and rehabilitation of the existing tunnel is planned through 2038.

Assistant Inspector General J.J. Marzullo wrote that Amtrak has made “notable progress” applying lessons from other capital projects but should better define its role across the program. Amtrak has a “unique role” because it will own the new tunnel, yet project partners have disagreed over the level of Amtrak involvement in projects it does not oversee and access to risk registers used to track and manage risks. Although one dispute has been resolved, the audit noted potential for future disagreements. Because Amtrak will be responsible for a third of some cost overruns on projects it is not leading, the report stated that greater visibility into project risks would improve planning of mitigation strategies and help anticipate cost and schedule liabilities.

The audit also recommended involving all relevant Amtrak departments during planning and construction. While track outage teams were included, the accounting and procurement units were not consistently engaged. Auditors identified a financial matter indicating Amtrak was due a $104 million refund that the project team was unaware of, and a contract requiring Amtrak to purchase certain construction materials for the new tunnel with lead times of up to five years, which the procurement team had not begun preparing for.

A further recommendation addressed Amtrak’s web‑based document management system. Thousands of project documents are being stored, but inconsistent use has made files difficult to locate. In response, Amtrak hired a dedicated document management specialist to reorganize the system and issued guidance to assist users.

The report described progress that could benefit the program over the long term. Amtrak acquired nine real estate parcels needed for the project, with a tenth on schedule. A first draft of the testing and commissioning plan for the new tunnel has been prepared four to six years ahead of when communication systems, train signals, and ventilation plants will require testing, a phase described as “critical to the successful transition” to the new tunnel. Multiple Amtrak officials told auditors that both Amtrak and the delivery partner managing the tunnels program are sufficiently staffed, an improvement over prior projects. The Hudson River tunnel program is described as the largest federally funded project in U.S. history and involves partners including NJ Transit, the Port Authority of New York and New Jersey, and the Gateway Development Commission. Marzullo said the report was completed in the early stages to help Amtrak “sustain this progress over the life of the project” and “better safeguard its interests.”

The report contrasted current staffing with issues identified last year on the $2.3 billion Portal North Bridge project, where auditors found a shortage of required staff, a nine‑month backlog in cost data review, and additional labor that increased Amtrak’s costs by 140%. At that time, Mason told the audit team the company planned to hire a director to improve coordination of construction plans, schedules, and budgets.