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The Hudson River tunnel project connecting New York City and New Jersey is facing an imminent work stoppage after the Trump administration suspended USD 16 billion in federal funding. Officials have warned that construction will halt from February 6 if funding is not restored, putting about 1,000 jobs at risk. The project is critical for replacing and repairing a tunnel built in 1910 that serves 200,000 daily commuters. The dispute has sparked sharp political exchanges, with concerns growing over economic impact, transit reliability, and long-term infrastructure planning.
Work on the new Hudson River rail tunnel linking New York City and New Jersey is set to stop within days unless the Trump administration restores federal funding that was put on hold earlier. Officials involved with the project have warned that construction will be paused from February 6 if no decision is taken to revive the approved financial support. Advertisement
The tunnel project, seen as a backbone of rail movement between New Jersey and Manhattan, lost momentum after the Trump administration suspended USD 16 billion in funding. President Donald Trump had already terminated the project last year, continuing a broader pattern of opposition to large transit projects in Democratic-led states. The funding freeze has now reached a critical stage, with agencies and lawmakers cautioning that the project cannot continue without federal backing.
During a recent congressional hearing, the Gateway Development Commission and New Jersey Congressman Josh Gottheimer said the halt would immediately affect around 1,000 workers. They noted that uncertainty around funding has already slowed progress, despite more than USD 1 billion having been spent so far on early works and preparations.
The Hudson tunnel currently in use was built in 1910 and suffered serious damage during Hurricane Sandy in 2012. Any failure of this ageing structure could severely disrupt travel across the region, which supports nearly 10% of the United States' economic output. Around 200,000 passengers rely on the tunnel every day for work and essential travel between New Jersey and New York City.
The broader Gateway initiative includes repairing the existing tunnel and building a new one to serve Amtrak and state-run commuter rail services. The plan had secured USD 12 billion in federal grants along with USD 4 billion in federal loans under the previous administration led by President Joe Biden.
New Jersey Governor Mikie Sherrill criticised the suspension, saying the refusal to fund the tunnel undermines jobs, the regional economy, and working families. In response, the White House said Democrats were responsible for the stalemate, arguing they had failed to negotiate and were blocking progress on the project.
The dispute has also drawn in the U.S. Department of Transportation, which accused Gateway late last year of violating rules under the Disadvantaged Business Enterprise programme. This programme is meant to support small businesses owned by socially and economically disadvantaged individuals. Gateway has maintained that it is complying with federal law, especially after recent court rulings changed how disadvantage is defined in contract bidding.
New York Governor Kathy Hochul warned that stopping construction would have wide consequences, affecting daily commuters, union jobs, and long-term economic benefits for the region. She described the potential shutdown as part of a broader pattern of federal actions that have placed New York's transit funding under pressure.
Federal authorities have previously threatened to cut transit support to New York. The Transportation Department had earlier warned it could withhold 25% of federal transit funding from the Metropolitan Transportation Authority if safety conditions for subway maintenance workers were not improved. The Trump administration is also seeking to end Manhattan's congestion pricing programme, introduced last year to manage traffic and generate funds for public transport.
Source Reuters
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