The Gateway rail tunnel project linking New York and New Jersey has received an initial $30 million installment of federal reimbursements after a funding freeze, with project officials expecting the remaining balance of about $205 million to follow next week as construction remains paused.
The money is part of reimbursements the project's sponsoring entity, Gateway Development Corporation, says it is owed under federal agreements for work underway on the Hudson Tunnel Project, a major rail effort under the Gateway Program.
A spokesperson for the project confirmed receipt of the $30 million and said construction is paused while officials work with contractors on how to deploy the funds and bring workers back as quickly as possible, according to Politico.
The pause followed a broader dispute over a U.S. Department of Transportation suspension decision dated Sept. 30, 2025, which the states and the project have challenged in court.
In a federal filing, the states said DOT announced it would indefinitely suspend payment of project funds pending a review tied to regulations governing contracting with disadvantaged business enterprises, a framework often discussed in the broader DEI debate over federal contracting.
U.S. District Judge Jeannette A. Vargas issued a temporary restraining order on Feb. 6 that blocked DOT's suspension of Hudson Tunnel Project funds, and later allowed a brief administrative delay while the government pursued emergency appellate relief.
The judge also directed the Trump administration to file a status report by 3 p.m. Tuesday on efforts to transfer the money.
Senate Minority Leader Chuck Schumer, D-N.Y., criticized the initial freeze and said the funds had been appropriated by Congress and committed by contract, while the states' top lawyers pressed for emergency court action after construction was halted.
The office of New York Attorney General Letitia James and New Jersey officials said they sought an emergency hearing as the project warned that a work stoppage would trigger cascading costs and schedule impacts.
The U.S. Department of Transportation said it was following the court order.
Trump infrastructure funding freezes related to DEI have extended beyond Gateway.
In October 2025, Reuters reported the administration was withholding about $18 billion linked to major New York City transportation projects, including the Second Avenue subway extension and the Hudson Tunnel Project, citing concerns about DEI-related contracting and compliance reviews.
Also in October 2025, the CTA in Chicago described a pause of about $2.1 billion in federal funding for Chicago transit projects, including the Red Line extension, with administration officials citing concerns about race-based contracting and related DEI issues.
Reuters contributed to this story.
Jim Thomas ✉
Jim Thomas is a writer based in Indiana. He holds a bachelor's degree in Political Science, a law degree from U.I.C. Law School, and has practiced law for more than 20 years.
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