NEW YORK — The Gateway Development Commission has received the full $205 million in Hudson Tunnel funding that had been withheld by the federal government, the commission said today (Feb. 18). As a result, tunnel construction, which halted on Feb. 6, should resume next week.
“We are working with our contractors to deploy these funds to resume work as soon as possible,” the commission said in a statement. “Letters will be sent to contractors today, and construction activities are expected to resume next week. We continue to pursue all avenues to secure access to the full amount of federal funding for the Hudson Tunnel Project, including our lawsuit.”
The commission filed suit on Feb. 2, saying the U.S. Department of Transportation had breached its financial obligations by failing to reimburse project costs “without identifying any contractual basis for withholding funds.” [See “Gateway Commission sues …,” Trains.com, Feb. 3, 2026.] Another suit, by the states of New York and New Jersey, led to a ruling by U.S. District Judge Jeannette Vargas ordering the government to release the withheld money while that suit advances. [See “Judge orders funds released …,” Trains.com, Feb. 7, 2026.]
The money had been withheld since the Department of Transportation said in September that it was stopping payment until it determined if the project was in compliance with rules regarding contracts to disadvantaged business. The rules regarding such contracts had changed under a January 2025 executive order. But President Donald Trump subsequently said funding had been “terminated” as part of an effort targeting projects supported by Democrats. More recently, a White House spokesman tied the funds to the fight over the administration’s immigration policies.
Trump, in a social media post on Monday, railed against the project, saying it was a “future boondoggle” that will cost billions more than projected, and will be “financially catastrophic to the region.”
He also contradicted a Feb. 10 statement by presidential press secretary Karoline Leavitt, who confirmed reports Trump had suggested tunnel funding could be released if New York Penn Station and Washington’s Dulles International Airport were named for him. “It was something the president floated in his conversation with [Senate Minority Leader] Chuck Schumer,” Leavitt said.
But Trump claimed in his social media post that “certain politicians and construction union heads” had proposed the renaming.
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