As workers prepare to pause work on a monumental rail tunnel project, officials in New Jersey and New York are continuing to amp up the pressure on the Trump administration to release funding, including with a lawsuit in federal court.
In September, the day before the start of a lengthy government shutdown, the Trump administration froze funding for the Gateway project, a $16 billion effort to build new tunnels connecting New Jersey and Manhattan. Gateway’s reserves are now depleted, and workers must pause construction on Friday, immediately putting more than 1,000 union workers out of a job.
Gov. Mikie Sherrill and New York Gov. Kathy Hochul announced Tuesday night that they sued the Trump administration to release the funding. Sherrill told reporters Wednesday that the Gateway project is a “hostage” in a political fight.
“The project’s underway. Nearly 1,000 people are all hard at work, and canceling the funding is arbitrary, it’s capricious, and it’s illegal, and I refuse to let it happen,” Sherrill said.
The Trump administration said it froze funding to review “unconstitutional DEI principles” in the project, but officials have said they’ve received no guidance on how to actually address the administration’s concerns.
“It reflects an unlawful effort by the president to punish political rivals by holding up this critical project,” acting Attorney General Jennifer Davenport told reporters. “And that’s something the president hasn’t hidden. He publicly announced Gateway is, quote, ‘Terminated because the Democrats are so foolish.’”
Davenport said the lawsuit asks a federal judge for emergency relief by Friday.
“This lawsuit is straightforward,” Davenport said. “The Trump administration cannot unlawfully freeze billions of dollars it owes for the Gateway project. So New Jersey and New York are jointly suing in the Southern District of New York to demand that the US Department of Transportation stop this illegal suspension of funds.”
The New Jersey-New York lawsuit isn’t the first related to the freeze. The Gateway Development Commission, the bistate agency operating the construction of Gateway, filed a different lawsuit earlier this week in a federal claims court. The GDC’s filing argues the Trump administration has breached its contract by withholding $205,275,358 in owed funds. They say the federal Department of Transportation has identified no wrongdoing by GDC, nor has it offered the GDC any steps to resume the funding.
The Trump administration has until Friday to file a response in that case, and a status conference is scheduled for next week.
Sherrill said she has spoken to Trump, and in their conversation, she conveyed the economic importance of the project, which officials say could be worth 100,000 jobs and $20 billion of economic output.
“He said he knows how important it is,” Sherrill said.
Rep. Josh Gottheimer (D-Tenafly) said a termination of the project would be devastating for the region, and said bipartisan members of Congress are working with the White House to resume construction.
“People are pissed off,” Gottheimer said. “And hopefully this thing will be long solved before another election, but I’m sure people are going to take this into account.”
Federal grants fund about 70% of the Gateway project; the rest comes from Department of Transportation loans that will be paid back by New York and New Jersey states and the Port Authority. The Trump administration froze both forms of funding. The GDC said an extended pause in funding increases the chances that the 116-year-old North River Tunnel will have to shut down. If that happens, the country’s most-used passenger rail line would be severed.
The states said they brought their own independent lawsuit because long-term delays in the project would cost the state millions in additional costs.
“There has been no credible explanation for the holdup other than political games and moving the goalposts for this,” Sherrill told reporters Wednesday. “So I think it’s pretty likely that we’ll prevail.”