October 23, 2025, at the Gateway Tunnel site near West 30th Street and 11th Avenue in Hudson Yards, Manhattan.
Barry Williams | New York Daily News | Getty Images
New York Gov. Kathy Hochul said Wednesday that the Trump administration has released remaining funds it had set aside for construction of a major rail tunnel between Manhattan and New Jersey.
Hochul said in a statement that the federal government has provided free of charge the remaining $98 million owed for the Gateway project, which increases passenger rail capacity to Manhattan, and an additional $30 million in reimbursement for work completed in January.
The frozen funds were released in phases over nearly two weeks after a federal judge blocked the Trump administration’s withholding of funds for projects scheduled to break ground in 2023. Following the Feb. 6 order, the administration released $30 million on Feb. 13, followed by another $77 million earlier this week.
The funding cut, which began on the eve of the Oct. 1 government shutdown, caused a complete shutdown this month and threatened the jobs of about 1,000 employees.
The Democratic governor said in a statement Wednesday that contractors have been directed to prepare to resume construction next week.
“Today’s progress is important, but we need certainty that Gateway funding will continue for the duration of the project,” Hochul said. “The federal government has a legal obligation to fully fund Gateway, and New York State will not accept anything less.”
Just two days ago, President Donald Trump denounced the project as “future profiteering” and claimed in a post on Truth Social that it would cost “billions of dollars more than predicted or anticipated.”
Trump claimed the federal government was not responsible for cost overruns related to the $16 billion project.
In the same post, he denied reports that he had offered to waive federal funding for Gateway in exchange for New York’s Penn Station being renamed after him. The station was named after its builder and original occupant, the Pennsylvania Railroad.
“These funds should never have been withheld in the first place,” said New York Attorney General Letitia James, who sued the Trump administration along with New Jersey Acting Attorney General Jennifer Davenport.
“I’m excited to get hardworking New Yorkers back to work and move forward on some of our nation’s most important infrastructure projects,” James said in a press release. “We will remain vigilant to ensure this funding continues uninterrupted to ensure that workers and commuters are not once again left in the lurch by the President’s targeted and illegal whims.”
The Hudson River Tunnel project is the most important part of the Gateway program, which aims to renovate a large amount of public infrastructure in New York and New Jersey.
The existing rail tunnel, known as the North River Tunnel, carries 200,000 passengers under the Hudson River each day. Officials say it was built 116 years ago and was in need of restoration even before it was severely damaged by Superstorm Sandy in 2012.
The Gateway project will rehabilitate the existing tunnel and create a new rail tunnel with two tracks connecting to Penn Station.
The federal government and the states of New York and New Jersey are funding the tunnel project. Amtrak is also committing more than $1 billion to the project.
