Court orders Trump administration to restore funding for Hudson River Gateway tunnel project

A federal court judge ordered the Trump administration on Friday to release funding it has withheld for months from the $16 billion Gateway tunnel project after New York and New Jersey jointly sued the administration.

The ruling issued just before 7:30 p.m. Friday came just hours after the Gateway Development Commission, the bi-state board in charge of the megaproject, announced construction on the massive rail tunnel under the Hudson River would be put on hold indefinitely as of Friday evening if the funding was not released. Workers spent the day winding down operations and preparing equipment for a possible long-term work stoppage.

After the ruling, the commission, in a statement, said, “As soon as funds are released, we will work quickly to restart site operations and get our workers back on the job. ” 

In her ruling, U.S. District Court Judge Jeannette A. Vargas said lawyers for both states have “adequately shown that the public interest would be harmed by a delay in a critical infrastructure project.”

The judge’s ruling, a temporary emergency order, calls on both sides to submit further documentation by Feb. 11.

The lawsuit was filed Wednesday by New York State Attorney General Letitia James and New Jersey acting Attorney General Jennifer Davenport, who argued President Donald Trump’s pause on funding was unconstitutional and an act of political retribution.

The White House and U.S. Department of Transportation did not immediately return requests for comment.

In October, Trump announced he was pulling funding for the project, which is designed to replace the aging 116-year-old North River Tunnel. The president said his administration was “getting rid of programs that we didn’t like.” Administration officials said they were targeting projects that promoted “DEI principles,” referring to diversity, equity and inclusion programs.

Trump’s announcement came amid a federal government shutdown and was among several moves made by the Trump administration to pull funding from New York, the home of the Democratic leaders in the House and Senate. It also fueled an ongoing rivalry between Trump and New York Gov. Kathy Hochul, who have clashed on several issues, including immigration and Manhattan’s congestion pricing program.

The Gateway Development Commission on Monday filed a separate lawsuit with the U.S. Federal Court of Claims, suing the administration for breach of contract, arguing the federal funding, passed by Congress under a bipartisan infrastructure bill in 2021 and signed by then-President Joe Biden, is contractually obligated. A follow-up hearing is scheduled for Feb. 10.

Tom Prendergast, CEO of the Gateway Development Commission, in a statement earlier on Friday warned of the economic impact and human toll of delaying the project.

“For more than two years the hardworking men and women building the Hudson Tunnel Project have not missed a day of work,” Prendergast said. “That changes today, because the federal administration continues to withhold funding for this vital investment in our nation’s rail infrastructure. After spending more than $1 billion, and countless hours of hard work, on this project, we will be left with empty construction sites in New York and New Jersey.”

Earlier in the day, New York’s Democratic senators continued to press Trump to reverse the funding freeze.

Senate Minority Leader Chuck Schumer, in a statement to Newsday, said he spoke “directly with President Trump multiple times over the past several weeks, urging him to restore the funding, keep the workers on the job, and reap the massive economic benefits this project will create.”

“For the good of New York, New Jersey, our economy, and union workers, the only thing to do is for President Trump to release the legally-approved funds now,” Schumer said.

Sen. Kirsten Gillibrand accused Trump of holding the project “hostage” after reports in Punchbowl News and Politico on Thursday indicated Trump had floated the prospect of releasing the funds if Schumer agreed to rename Penn Station and Dulles International Airport in Virginia after the president. The White House has not commented on the reports.

“I demand that the president put people first and unfreeze this project and all the others his administration has been holding hostage for his personal gain,” Gillibrand said in a statement.