New York and New Jersey filed suit against the Trump administration late Tuesday, demanding the full restoration of federal funds for construction of the Gateway Project‘s Hudson River Tunnel.
The $16 billion tunnel project, which would double the number of rail lines between New Jersey and New York Penn Station, is set to run out of funds on Friday, following a months-long refusal by the Trump administration to distribute project funds dedicated by Congress.
“Allowing this project to stop would put one of the country’s most heavily used transit corridors at risk,” New York Attorney General Letitia James said in a statement. “Our tunnels are already under strain, and losing this project could be disastrous for commuters, workers, and our regional economy.”
The AG said the suit intended to halt a shutdown “that would ripple far beyond New York and New Jersey.”
Federal money is earmarked to cover more than two-thirds of the tunnel’s cost.
Construction of the tunnel — the centerpiece of the broader Gateway project to modernize and expand rail lines between the Jersey Meadowlands and midtown Manhattan — is expected to create some 70,000 jobs.
Work on the tunnel has been ongoing since the feds first froze funds in October, and a massive tunnel-boring machine is standing by, ready to start digging through bedrock under Jersey City.
But Gateway officials said last week the work would come to a halt indefinitely on Friday if the feds don’t let the congressional dollars flow — a stoppage that will endanger the project and axe about 1,000 jobs.
The states’ eleventh-hour suit comes a day after the Gateway Development Commission — the bi-state body tasked with overseeing the tunnel’s construction — filed its own suit in the Court of Federal Claims, accusing the Trump administration of breach of contract for withholding the funds.
The states’ suit, filed Tuesday, similarly argues the funding hold is illegitimate.
“The funding freeze is not based on any legitimate compliance concern but instead reflects an unlawful, politically motivated decision,” James’ office said in a statement. “In public statements, including statements made by the president himself, the administration has been explicit that the suspension of funding is a brazen act of political retribution.”
James and Acting N.J. Attorney General Jennifer Davenport are asking the court to rule the funding interference is illegal, and to order the resumption of funding fast enough to keep work from stopping.
Regardless of illegality, the Trump administration’s justifications for intercepting the funds have not been consistent.
The freeze was first announced in the early hours of last year’s federal government shutdown, over “unconstitutional DEI principles” in the selection of contractors.
Office of Management and Budget Director Russel Vought and U.S. Department of Transportation Secretary Sean Duffy claimed at that time the project — along with the MTA’s long-awaited Second Avenue subway extension — was no longer in compliance with contracting rules the government had just changed.
Duffy told reporters his department was “not trying to shut down these projects — to the contrary, we’re trying to make sure these projects move forward, move forward fast.”
But within weeks, President Trump took to gloating he’d “terminated” the project for good —not because of contracting rules, but because it was a favorite of New York Democrat and Senate Minority Leader Chuck Schumer.
“Billions and billions of dollars that Schumer has worked 20 years to get — it’s terminated,” the president said in October. “Tell him, ‘It’s terminated’.”
Regardless, USDOT continued to demand GDC get into compliance with its new contracting rules, something GDC CEO Tom Prendergast said last week had been accomplished.
“We have promptly responded to any and all requests to demonstrate the project is compliant,” Prendergast said last Tuesday.
When the Daily News asked the USDOT last week if that was true — and, if so, why Gateway still had no access to the congressional funds — a spokesperson directed the inquiry to the White House.
White House spokesman Kush Desai then offered a third reason for the ransom — a lack of Democratic fealty to the Trump administration’s historically unpopular immigration efforts.
“It’s Chuck Schumer and Democrats who are standing in the way of a deal for the Gateway Tunnel Project by refusing to negotiate with the Trump administration,” Desai claimed. “There is nothing stopping Democrats from prioritizing the interests of Americans over illegal aliens and getting this project back on track.”
