Judge Orders Trump Administration to Restore $16 Billion in Funding for New York-New Jersey Rail Tunnel

The decision blocks the administration from halting support for the critical infrastructure project amid an ongoing legal battle.

Published on Feb. 7, 2026

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A federal judge in Manhattan ordered the Trump administration to restore $16 billion in funding for a new rail tunnel connecting New York and New Jersey, ruling that the states would suffer irreparable harm if the project was forced to shut down. The judge approved a temporary restraining order sought by New York and New Jersey, blocking the administration from withholding the funds while the states' lawsuit plays out in court.

Why it matters

The new tunnel is a crucial infrastructure project for the region, aimed at easing strain on an over 110-year-old existing tunnel that serves as a major transportation link between the two states. Halting the project would have resulted in the immediate loss of around 1,000 jobs, with thousands more at risk in the future.

The details

The Trump administration had announced it was halting the $16 billion in support for the project, citing the government shutdown and concerns about unconstitutional spending around diversity, equity and inclusion principles. New York and New Jersey sued over the funding pause, arguing it would cause irreparable harm. The judge agreed, ruling that the states had "adequately shown that the public interest would be harmed by a delay in a critical infrastructure project."

  • On February 7, 2026, a federal judge ordered the Trump administration to restore funding to the New York-New Jersey rail tunnel project.
  • The administration had announced it was halting the $16 billion in support for the project in recent months.

The players

Jeannette A. Vargas

A U.S. District Judge in Manhattan who approved the request by New York and New Jersey for a temporary restraining order barring the Trump administration from withholding the funds.

Letitia James

The New York Attorney General who called the ruling "a critical victory for workers and commuters in New York and New Jersey."

Gateway Development Commission

The panel overseeing the rail tunnel project, which had said work would stop late Friday afternoon due to the federal funding freeze.

Donald Trump

The former U.S. President whose administration had announced it was halting the $16 billion in support for the project.

Chuck Schumer

The Democratic Senate Minority Leader whom the White House was blaming for a government shutdown last year, leading to the funding freeze.

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What they’re saying

“I am grateful the court acted quickly to block this senseless funding freeze, which threatened to derail a project our entire region depends on. The Hudson Tunnel Project is one of the most important infrastructure projects in the nation, and we will keep fighting to ensure construction can continue without unnecessary federal interference.”

— Letitia James, New York Attorney General (dnyuz.com)

“Absolute lie. He knows it. Everyone knows it. Only one man can restart the project and he can restart it with the snap of his fingers.”

— Chuck Schumer, Democratic Senate Minority Leader (dnyuz.com)

What’s next

The judge's temporary restraining order will remain in place while the states' lawsuit seeking a preliminary injunction to keep the funding flowing plays out in court.

The takeaway

This ruling represents a significant victory for New York and New Jersey in their fight to preserve critical infrastructure funding in the face of political interference. It underscores the importance of the courts in protecting major public projects from being used as bargaining chips in partisan disputes.