Trump Unfreezes $127 Million for Gateway Tunnel Project, Clearing Path for Construction
By Jim Thomas | Wednesday, 18 February 2026 04:07 PM EST
President Donald Trump released the remaining $127 million in previously frozen federal reimbursements for the Gateway tunnel project between New York and New Jersey on Wednesday, clearing the way for construction to restart after a court dispute over funding.
The Gateway Development Commission confirmed it has received the full amount owed from the federal government and now holds more than $205 million available for the Hudson Tunnel Project.
“Letters will be sent to contractors today, and construction activities are expected to resume next week,” the commission stated.
New York and New Jersey had sued the Department of Transportation after payments were withheld beginning October 1, and the funding interruption sidelined approximately 1,000 workers.
The administration released $30 million on February 13, $77 million on Tuesday, and the remaining $127 million on Wednesday.
In a complaint filed with the U.S. Court of Federal Claims on February 2, the Gateway Development Commission alleged that the Department of Transportation had failed to reimburse it by $205.3 million, citing a review tied to the Disadvantaged Business Enterprise program as the reason for suspending payments.
The dispute has unfolded alongside emergency court proceedings in New York federal court.
A temporary restraining order issued on February 6 described the project sponsors and warned that work would be halted without resumed federal disbursements.
The Hudson River rail tunnel work is part of the broader Gateway Program, which carries an estimated $16 billion cost according to the Department of Transportation. The project focuses on building new tunnels under the Hudson River and rehabilitating infrastructure along the nation’s busiest passenger rail line—the Northeast Corridor.
New Jersey Governor Mikie Sherrill, a Democrat, labeled the funding freeze “bewildering and illegal” in remarks released by her office Wednesday.
New York Governor Kathy Hochul, also a Democrat, called the release of funds a “major win.”
