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(The following article by David A. Michaels was posted on NorthJersey.com on July 20.)

BERGEN, N.J. — The federal government agreed Wednesday to let New Jersey pursue engineering for a new train tunnel under the Hudson River, a step hailed by state officials as moving the project from glorious fantasy to the brink of reality.

The $7.2 billion connection would get at least half its funding from the Federal Transit Administration, which awards funds for major transportation projects.

Kris Kolluri, the state’s transportation commissioner, called Wednesday’s decision “a major milestone.”

“We have an absolute commitment from all elected leadership in the region to pursue funding for the project,” Kolluri said. “I believe we have a very good chance of moving this project into construction by 2009.”

Kolluri and other officials credited Governor Corzine, who as a U.S. senator secured language in a bill that improved the state’s chances for federal funding.

NJ Transit will now undertake preliminary engineering, which includes plans for track alignment, tunnel construction, connections to subway and PATH lines, and electrical power. The FTA must approve those plans to move the 9.3-mile project to its next phase — design and production.

Approval of engineering plans also would allow NJ Transit to pursue a full-funding grant agreement, which would guarantee federal funds for the project. Another project, the Hudson-Bergen Light Rail, was completed with a similar $1.1 billion agreement.

The Port Authority of New York and New Jersey would be a likely source for a large chunk of funding. Anthony R. Coscia, the authority’s chairman, said he would like to earmark up to $2 billion for the project in the capital plan, set for approval in December.

New Jersey has reserved about $500 million for the project through its Transportation Trust Fund. States are often asked to contribute even more, but New Jersey might reduce its burden, thanks to a provision included in last year’s federal transportation bill by then-Sen. Corzine. That bill said the state could claim credit for its investment of $600 million in the River Line light rail in South Jersey and $438 million for 231 bi-level rail cars.

“We were trying to be creative about it,” said Heather Howard, who is now policy counsel to Corzine but served as his chief of staff in Washington. “It is smart leveraging.”

State officials say the tunnel project, dubbed Access to the Region’s Core, would double the railroad capacity, accelerating the commute of New Jerseyans to Manhattan. The current tunnel, with its two tracks, accommodates 24 trains every hour, Kolluri said. It also would give Bergen and Passaic counties a direct Manhattan connection, eliminating a transfer at Secaucus Junction.