{"id":283429,"date":"2026-07-01T10:54:18","date_gmt":"2026-07-01T10:54:18","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ny\/283429\/"},"modified":"2026-07-01T10:54:18","modified_gmt":"2026-07-01T10:54:18","slug":"trump-administration-wont-say-what-it-will-do-next-after-ruling-on-funding-for-massive-n-j-n-y-c-tunnel-project","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ny\/283429\/","title":{"rendered":"Trump administration won\u2019t say what it will do next after ruling on funding for massive N.J.-N.Y.C. tunnel project"},"content":{"rendered":"

A federal judge ruled that the US Department of Transportation\u2019s funding freeze that led to a shutdown of Gateway rail tunnel construction<\/a> earlier this year violated federal law and she ordered the agency from blocking funding in the future.<\/p>\n

U.S. District Court Judge Jeannette A. Vargas ruled Monday that the Sept. 30, 2025, action by the Federal Transit Administration that stopped reimbursement payments to the Gateway Development Corporation violated federal laws governing grants. <\/p>\n

New Jersey and New York sued<\/a> President Donald Trump<\/a>\u2019s administration on Feb. 3 over the freezing of Gateway Tunnel funding, contending it put taxpayers on the hook for millions of dollars in added costs. Construction work had to be shut down on Feb. 6 after funding was exhausted.<\/p>\n

The states won a temporary restraining order when Vargas ordered reimbursements to resume on Feb. 12<\/a>. <\/p>\n

Had the court not agreed with the states, Gateway officials warned the project could shut down again<\/a> if the feds withheld funds in the future.<\/p>\n

The suit stemmed from a September 2025 Federal Transit Administration decision to freeze federal reimbursement payments for Gateway<\/a>. The freeze was effective while the agency conducted a review to determine if the projects comply with a new rule finalized that day.<\/p>\n

That rule bars considering race or gender when awarding contracts to disadvantaged businesses under a Disadvantaged Business Enterprises program, which includes businesses owned by people of color and women.<\/p>\n

\u201cThe September 30 suspension skipped right to payment suspension without any finding that GDC had violated the law,\u201d Vargas wrote in a 59-page ruling. \u201cDOT provided no opportunity for GDC to appeal the September 30 suspension. This is clearly contrary to law.\u201d <\/p>\n

In late October, commission officials said they suspended all DBE contracts to comply with the rule. Commission officials said they received no response for USDOT to letters sent in December and January that confirmed they complied with the new regulation. <\/p>\n

Will the Trump Administration appeal the ruling? USDOT officials declined to answer that question when asked by NJ.com.<\/p>\n

Instead, the USDOT seemed to double down on the reasons it cited for suspending the funding in a response to the ruling.<\/p>\n

\u201cUSDOT remains committed to ensuring hardworking taxpayer dollars are being spent responsibly and do not fund unconstitutional, discriminatory contracting practices,\u201d a spokesperson said. <\/p>\n

But U.S. Rep. Nellie Pou, D-9th Dist., said she expects the administration will appeal.<\/p>\n

\u201cGiven the rampant lawlessness at the Justice Department, I accept that this baseless case will likely be appealed,\u201d said Pou, a member of the House Transportation and Infrastructure Committee. \u201cI am hopeful and optimistic the courts will continue to find the same thing as Judge Vargas: Gateway is going forward and Gateway must be completed. <\/p>\n

\u201cNew Jersey\u2019s future depends on it.\u201d<\/p>\n

The decision spares taxpayers in New Jersey and New York from having to pay millions of dollars in added costs. Under a July 2024 contract with the FTA, the states have to pay for costs beyond the federal grants and loans.<\/p>\n

\u201cEvery unnecessary delay comes at a steep cost,\u201d said Tom Wright, Regional Plan Association CEO. \u201cRegional Plan Association estimates that delaying the Gateway Program by just six months would add as much as $1.34 billion to the project\u2019s cost.\u201d<\/p>\n

A joint statement by New Jersey Gov. Mikie Sherrill and New York Gov. Kathy Hochul and the two states attorney generals warned that the Trump Administration\u2019s attempt to halt Gateway funding will not stand.<\/p>\n

\u201cWe are grateful that a federal court has once again agreed that the Trump Administration\u2019s decision to freeze billions of dollars in grants for the Gateway Tunnel Project is flagrantly unlawful,\u201d they said in a joint statement. \u201cThis is the most important infrastructure project in the nation, and thanks to our litigation, 1,000 people are back on the job and construction continues every day.\u201d <\/p>\n

The political nature of the funding freeze was also addressed in Vargas\u2019 decision.<\/p>\n

Vargas\u2019 ruling also mentioned Trump\u2019s Oct. 15 statement that Gateway is \u201cterminated\u201d<\/a> and subsequent statements he defunded it to retaliate against Democratic legislators. <\/p>\n

At the time, U.S. Sen. Chuck Schumer, D-N.Y., was leading the Democrats effort to win back federal tax support for millions of people covered by the Affordable Care Act, which lead to a government shutdown.<\/p>\n

\u201cThe ostensible reason for the suspension of funds was to allow DOT to conduct a review of GDC\u2019s compliance with federal nondiscrimination laws,\u201d Vargas wrote. <\/p>\n

\u201cPresident Donald J. Trump, however, made contemporaneous statements indicating that he had personally made the decision to \u2018terminate\u2019 funding for the project \u2018because the Democrats are so foolish \u2013 what they\u2019ve done to the country,\u2019” she said.<\/p>\n

She also mentioned on Oct. 2, 2025, Office of Management and Budget Director Russell Vought declared that the Trump Administration would withhold roughly $18 billion from New York City infrastructure projects, including the Hudson Tunnel Project.<\/p>\n

But that USDOT review went beyond the end of the government shutdown. DOT has never made any determination that the GDC did not comply with federal law and the funding freeze was still in place as of February 2026, she said.<\/p>\n

Vargas was appointed to the court in 2024 by then-President Joe Biden. <\/p>\n

The $16 billion Gateway would build two new tunnels under the Hudson, rehabilitate the two existing tunnels and build other infrastructure. The 116-year-old tunnels are a notorious choke point and require constant maintenance, usually done overnight and by shutting down a tunnel on weekends.<\/p>\n

The funding freeze also caused the commission to delay awarding two of the projects largest contracts <\/a>from late 2025 until this Spring to drill the actual tunnel under the Hudson River.<\/p>\n

That $1.28 billion contract to drill the main section of the tunnel<\/a> was awarded in April.<\/p>\n","protected":false},"excerpt":{"rendered":"A federal judge ruled that the US Department of Transportation\u2019s funding freeze that led to a shutdown of…\n","protected":false},"author":2,"featured_media":283430,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35],"tags":[75,84,83,9,24,63],"class_list":["post-283429","post","type-post","status-publish","format-standard","has-post-thumbnail","category-manhattan","tag-manhattan","tag-manhattan-headlines","tag-manhattan-news","tag-new-york","tag-new-york-city","tag-nyc"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/283429","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/comments?post=283429"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/283429\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media\/283430"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media?parent=283429"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/categories?post=283429"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/tags?post=283429"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}