A federal judge on Friday temporarily blocked the Trump administration from suspending federal disbursements for the Gateway Tunnel project.
Construction on the project was expected to stop Friday night without court intervention. Judge Jeannette Vargas has also asked for both parties to submit additional information on the issue within the next few days.
The tunnel is being constructed under the Hudson River to connect New York and New Jersey. The pause in building would have resulted in the immediate loss of nearly 1,000 jobs, according to a press release from the project, and an extended pause could put about 11,000 construction jobs at risk.
The administration halted funding for the $16 billion project when the government shut down last fall. But despite the shutdown ending in November and government funding packages passing this week, the administration has not released the funds.
The administration asked Senate Minority Leader Chuck Schumer, D-N.Y., for Dulles International Airport in Washington and Penn Station in New York to be named after President Donald Trump in exchange for releasing the funds needed to build the tunnel, multiple sources told NBC News on Thursday.
New York Gov. Kathy Hochul said in a statement said the judge’s ruling “affirmed” that the Trump administration’s funding freeze “is likely to be found unlawful.”
“This ruling is a victory for the thousands of union workers who will build Gateway and the hundreds of thousands of riders who rely on it every day,” Hochul said.
New York Attorney General Letitia James called the ruling a “victory for workers and commuters in New York and New Jersey,” adding that the funding freeze “threatened to derail a project our entire region depends on.”
The $16.1 billion project includes a new railway tunnel under the Hudson River that would link New York and New Jersey. The administration’s freeze came after the project already underwent years of delays and other problems. It was revitalized in 2024 after President Joe Biden’s administration said it would provide an additional $6.9 billion in funding.
“Suspending the funding for this monumental project based on the President’s desire to punish political rivals violates the Administrative Procedure Act many times over. In this Complaint, Plaintiffs New Jersey and New York ask the Court to stay, vacate, declare unlawful, and enjoin the September 30 decision to suspend federal funding for the Project,” the states said in their complaint.
The states alleged that the funding has been halted “because President Trump is engaged in political retribution.”
New Jersey Gov. Mikie Sherrill also celebrated the ruling, writing in a statement that “President Trump’s arbitrary and politically motivated decision to freeze this funding is plainly illegal.”
Jennifer Davenport, acting attorney general of New Jersey, said in her own statement that halting construction would “cause grave harm to New Jersey and New York.”
“The Trump Administration must drop this campaign of political retribution immediately and must allow work on this vital infrastructure project to continue,” Davenport said.
White House budget director Russell Vought said at the time of the funding freeze that he was stopping funding for infrastructure projects to “ensure” it wasn’t used “on unconstitutional DEI principles.”
Both New Jersey and New York have sued to force the administration to release the funds, which had already been appropriated.
