NY and NJ sue Trump administration for withholding Gateway funding
Credit: Gateway Development Commission
New York and New Jersey are suing the Trump administration for withholding $15 billion in federal funding previously set aside for the transformative Gateway project. Announced Tuesday, the lawsuit seeks emergency relief to prevent the U.S. Department of Transportation (USDOT) from continuing to withhold critical funding for the project, which is building a new rail tunnel and rehabilitating a dilapidated one. The legal action follows the Gateway Development Commission’s announcement last week that work would stop on February 6 unless federal funding is restored.
“Donald Trump’s revenge tour on NY threatens to derail one of the most vital infrastructure projects this nation has built in generations, putting thousands of union jobs and billions of dollars in economic benefits in jeopardy and threatening the commutes of 200,000 riders,” Gov. Kathy Hochul said.
“NY will fight this illegal effort by the Trump Administration to steal the funding the federal government committed to get the Gateway Tunnel built with everything we’ve got. My message to Donald Trump and Sean Duffy is simple: we’ll see you in court.”
The lawsuit, filed in federal court in the Southern District of New York, is separate from another suit filed by the Gateway Development Commission earlier this week. According to a press release, the states said they are bringing the lawsuit because ending the project would “kill thousands of jobs” and “imperil” the commutes of New Yorkers and New Jerseyans.
They also warned that halting the project would erase the benefits of millions of dollars in funding and land already contributed by the states, while forcing them to absorb significant new operating costs. Because construction has already begun, both states would also be required to spend millions more to secure active work sites and prevent serious public safety and public health hazards.
“Every time the Trump Administration gets involved, costs go up and working people suffer. The illegal attack on the Gateway Tunnel is yet another example. New Jersey will not back down from this fight,” Gov. Mikie Sherrill said.
“If this project stops, 1,000 workers will immediately lose their jobs and hundreds of thousands of commuters will lose the chance at finally having reliable train service that makes their lives easier.”
Gateway ranks among the nation’s largest public infrastructure projects, with a key component being the Hudson River Tunnel Project, which began construction in November 2023. Tunnel boring was set to start this summer.
In August, the GDC announced that two massive tunnel-boring machines were set to arrive in early 2026 to start excavating the 2.4-mile connection to Penn Station. One has already arrived on site, as 6sqft previously reported.
Despite a previous $12 billion federal commitment made under the Biden administration, funding ceased in October during the government shutdown. The remaining $4 billion is financed through loans from the USDOT’s Build America Bureau, to be repaid by NY, NJ, and the Port Authority. Funding from these sources has been halted since October 1, 2025.
Construction has continued thanks to a $500 million line of credit from Bank of America, provided to the GDC, according to Politico. However, the commission said last week that work would be forced to stop by February 6 once the credit is fully depleted.
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