Gateway: Hudson Tunnel work to pause again if feds slow funding stream

The Gateway Development Commission (GDC) yesterday announced that while construction on the Hudson River rail tunnel project has fully resumed, construction will pause again in two to three months if the federal government again delays the flow of federal dollars that the project has been promised.

Additionally, the commission cannot award two major procurement contracts until it has full access to the $15 billion in federal grants and loans owed to it. Both contracts originally were scheduled to be awarded in late 2025 or early spring 2026, Gateway officials in a press release.

Construction resumed on the $16 billion Hudson Tunnel project in mid-February after the commission paused the work on Feb. 6 after a federal funding stream ran out after the Trump administration ordered in October 2025 a freeze on previously awarded grants and loans. The commission and New York and New Jersey officials sued the federal government for halting the project's funding and won, resulting in federal funding beginning to flow. 

"[W]e will have no choice but to stop work again if the federal government does not continue to disburse the funds that are committed to the project," GDC CEO Tom Prendergast said yesterday. "This project is too important to delay. That’s why we’re doing everything possible to regain consistent and predictable access to all our federal funding so we can keep our workers on the job and deliver the reliable, modern rail transit Americans deserve." 

The project calls for constructing and rehabilitating rail tunnel infrastructure under the Hudson River. The existing 110-year-old tunnel carries over 200,000 daily passenger trips between New York City and New Jersey.