120 m.p.h. trains in Northeast-if; Congress approves $750 million for electrification, other improvements; Boston-to-NYC: 3 hours, 40 minutes

The largest US railroad-building project in this century is nearing its final turn in Congress. Back from its Easter recess, the Senate is about to grapple with a $750 million addition to the $1.75 billion funding of the Northeast Corridor Improvement Project (NECIP), which is designed to transform the antiquated Washington-to-Boston railroad to a modern transportation system by 1984-85.

Assuming the additional funding gets the green light, electric trains traveling up to 120 m.p.h. are expected to cut an hour and 20 minutes from the trip between New York and Boston (now about five hours). But first, the Northeast Corridor will have to be fully electrified. At present, the overhead power lines extend only as far north as New Haven, Conn. The New York-to-Washington time is expected to be cut from 3 1/2 hours to 2 hours, 40 minutes.

In addition, efforts are being made to upgrade stations all along the route, many of which are some distance from the heart of the cities they serve. Rehabilitatin and revitalization of surrounding station areas spurred by the federal "seed money" will bring in millions of dollars to local economies -- but only if the additional funding is approved.

Boston's South Station is a case in point. Groundbreaking ceremonies are scheduled next spring for a $90 million complex connected to the familiar neoclassical granite-and-wood facility, which is listed on the National Register of Historic Places. The Federal Railroad Administration (FRA) is providing $33. 9 million (much of which is going for track work), and the rest is coming from state, local, and private investment.

Matthew Coogan, South Station project director for the Boston Redevelopment Authority, says it "is really the cornerstone of our strategy for the downtown area.

"Specifically we'll have the FRA on the first level, parking on the second level, Greyhound and Trailways bus terminals on the third levels, and, above that, a hotel and office complex."

He adds that although it has long been assumed that bus companies wouldn't like being in the same building with the railroads, "the companies know darn well that the federal till isn't going to open up for $30-to-40 million very often."

In Providence, R.I., a major commercial development project, also involving state and local governments, hinges on NECIP funding. The crucial element involves moving the now-elevated tracks closer to the Rhode Island State House and building a new railroad station. This will free for commercial development a large area of land adjacent to the downtown area but previously unusable because of the elevated tracks.

"The total package of public improvements far exceeds the Federal Railroad Administration portion. But without their move, everything else is academic," says Ron Marsella, a consultant on the Providence project. "This appropriation in Congress is crucial. Without the increase, there will not be enough funds in the Northeast Corridor Project for the railroad relocation."

Much railroad improvement work already has been done along the corridor -- including the laying of new concrete ties and continuous welded track along a 161-mile stretch from the Route 128 station near Boston to New Haven. But NECIP director Louis Thompson says Senate failure to approve the funding would "set us back a long, long way.

"The contingency plans are not very pleasant," he continues. "if the money is not approved, the whole station program, as well as the electrification from New Haven to Boston, will probably be endangered. We may not be able to reach our goal of a 3-hour, 40-minute train ride from New York to Boston."

Although many improvements have been made in the past several years, especially along the Washington-to-New York run, Mr. Thompson says even more needs to be done, and "without the $750 million, we will not be able to build the kind of railroad we feel should be built."

Inflation is one reason more money is needed. But Mr. Thompson admits another key factor is that project planners did not realize at first just what they were getting into.

"The project sprang from unrealistic expectations," he says. "This is the largest single railroad job done in this century. And, because it's a rehabilitation job, it's much harder than a brand-new job would be because we have to keep the railroad operating at the same time we're working on it."

The House of Representatives approved the funding proposal March 31 as part of a bill that includes emergency provisions dealing with the bankrupt Rock Island Railroad in the Midwest and the appropriation of $950 million for construction of up to 13 more high-speed railroad corridors throughout the country.

Both the Senate Commerce Committee and the Carter administration are opposed to the creation of other high-speed railroad corridors without a study as to their necessity. In addition, many Midwestern senators want to deal with the Rock Island situation immediately. As a result, the entire bill has stalled.

"We're very concerned that the Northeast Corridor bill is, in effect, being held hostage to the resolution of these other problems," says Brad Penny, administrative aide to Sen. Claiborne Pell (D) of Rhode Island. But he says he feels certain the Rock Island issue will be resolved within the next few days. This might enable the Commerce Committee to act separately on a bill for the $ 750 million funding and a provision for a study of the need for emerging corridors in other parts of the country.