New Jersey CFO

Gov. Chris Christie today killed the multi-billion-dollar Hudson River commuter train tunnel, aborting the nation’s biggest public transit project as well as the state’s decades-long quest to double rail capacity to New York.

Christie said that given the impact of the recession and the probability of continuing cost overruns, the state could no longer afford the tunnel’s escalating costs. More than a half-billion dollars has already been spent on construction, engineering and land acquisition for a project currently budgeted at $8.7 billion that the governor said could go as high as $14 billion.

“The only prudent move is to end this project,” he said at a Trenton news conference. “I can’t put taxpayers on a never-ending hook.”

With the cancellation, the state will abandon $3 billion in federal funding earmarked for the project. Officials still hope to retain $3 billion in grant money allocated by the Port Authority of New York and New Jersey.

Christie made his decision even as Department of Transportation Secretary Ray LaHood was urging him from behind the scenes not to pull the plug before the two had a chance to discuss the matter, according to officials in the office of U.S. Sen. Robert Menendez (D-N.J.). They said LaHood called Christie before the press conference asking him to hold off.

A federal transportation spokeswoman said the secretary still plans to meet with Christie Friday afternoon “to discuss a path forward” on the tunnel project.

There had been wide speculation for weeks that the Republican governor was planning to cancel the project.