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Federal Judge Lifts Trump’s Freeze on $16B NY-NJ Tunnel Project Funding

A federal judge overturned Trump's freeze on $16B funding for the Gateway Project, a vital rail tunnel linking NY and NJ, after the administration sought to rename landmarks in exchange for funds.

·3 min read
Federal judge reverses Trump’s freeze on $16bn for NY-NJ tunnel project

Federal Judge Reverses Funding Freeze on Gateway Tunnel Project

A federal judge has overturned a freeze on $16 billion in funding for enhanced rail links connecting New York and New Jersey, a freeze imposed by former President Donald Trump who reportedly sought to have major travel landmarks renamed after him in exchange for continued investment.

The Gateway Project aims to construct a new commuter rail tunnel beneath the Hudson River, linking Manhattan and New Jersey on the western side of New York City. It also includes repairs to a century-old tunnel that serves over 200,000 travelers and 425 trains daily.

The existing River tunnel sustained significant damage during Hurricane Sandy in 2012 and requires frequent emergency repairs, which disrupt travel on the nation’s busiest passenger rail line.

US District Judge Jeannette Vargas in New York issued a temporary ruling on Friday, shortly after New York and New Jersey authorities announced that construction would halt due to lack of funding.

Judge Vargas stated that the states were likely to succeed on their claims that the directive freezing the funds was arbitrary and violated legal procedures for policy changes.

The White House and the US Department of Transportation did not immediately respond to requests for comment regarding the ruling.

New Jersey’s acting attorney general, Jennifer Davenport, and New York’s attorney general, Letitia James, released statements commending the ruling.

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“The Trump administration must drop this campaign of political retribution immediately and must allow work on this vital infrastructure project to continue,” Davenport said.

The two states filed a lawsuit on 3 January alleging that the Trump administration had frozen the funds as a “brazen act of political retribution” against their Democratic leadership. They warned that a work stoppage would delay a critical infrastructure project, harm their economies, and impose costs related to securing inactive construction sites.

The Trump administration had withheld $205 million in reimbursements for the project since 1 October. Trump reportedly demanded that Washington Dulles International Airport and New York’s Penn Station be renamed in his honor in exchange for releasing the funds, a move that drew strong criticism from Democrats.

On Friday, Trump told reporters he had not proposed renaming Dulles or Penn Station and did not comment on Judge Vargas’s decision.

The US Department of Transportation announced on 30 September that it froze the funds pending a review of the project’s compliance with new federal prohibitions against race- and sex-based considerations in contracting decisions.

The Gateway Development Commission informed the department that it had made changes and conducted a review to ensure compliance with these regulations but had not received a response, according to the lawsuit.

Gateway stated that the suspension would idle 1,000 construction workers and that Trump’s decision endangered passengers relying on “decaying, century-old rail infrastructure.” The commission had previously announced that work was already suspended.

Trump last month asked Chuck Schumer, the Senate minority leader, to support renaming Washington Dulles International Airport and Penn Station after him. Trump claimed Schumer had proposed renaming Penn Station, but Schumer, who represents New York, called this an “absolute lie” in a social media post.

Cory Booker, the senator from New Jersey, accused Trump of holding the tunnel project hostage, while New York Senator Kirsten Gillibrand said the president “continues to put his own narcissism” above the project’s union jobs and economic benefits.

The Moynihan train hall at Penn Station in New York on 23 January 2026.
The Moynihan train hall at Penn Station in New York on 23 January 2026. Photograph: Bloomberg/The Moynihan train hall at Penn Station in New York on 23 January 2026. Photograph: Bloomberg/

This article was sourced from theguardian

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