Trump Administration Releases Additional $77 Million for Hudson Tunnel Project

Construction remains on hold as legal dispute over federal funding continues

Published on Feb. 19, 2026

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The Trump administration has approved the release of another $77 million in previously frozen federal funding for the $16 billion Hudson Tunnel Project, marking a significant development in the ongoing funding dispute surrounding one of the nation's most critical infrastructure efforts. However, construction remains paused as state and federal officials work to resolve the remaining $205 million in frozen funds.

Why it matters

The Hudson Tunnel Project is a cornerstone of the broader Gateway Program aimed at modernizing rail infrastructure between New York and New Jersey. The existing Hudson River rail tunnels are considered a critical bottleneck in the Northeast Corridor, one of the busiest passenger rail lines in the country. Prolonged interruptions to construction could significantly increase overall project costs and undermine long-term infrastructure reliability.

The details

The newly released $77 million comes after weeks of tension between federal and state officials. New York and New Jersey had filed a lawsuit after the U.S. Department of Transportation (USDOT) declined to release $205 million allocated for the project beginning October 1. With the latest disbursement, total funds released by USDOT now stand at $107 million. The Gateway Development Commission confirmed that work has not yet resumed and said it is actively coordinating efforts to bring crews back to the site.

  • On October 1, the USDOT declined to release $205 million allocated for the Hudson Tunnel Project.
  • On February 17, 2026, the Trump administration approved the release of an additional $77 million in federal funding for the project.

The players

Kathy Hochul

The Governor of New York.

Gateway Development Commission

The organization overseeing the Hudson Tunnel Project, which is a cornerstone of the broader Gateway Program aimed at modernizing rail infrastructure between New York and New Jersey.

U.S. Department of Transportation (USDOT)

The federal agency that initially declined to release $205 million in allocated funds for the Hudson Tunnel Project, leading to a legal dispute with state officials.

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What they’re saying

“We must not let individuals continue to damage private property in San Francisco.”

— Robert Jenkins, San Francisco resident (San Francisco Chronicle)

What’s next

As legal proceedings continue over the remaining frozen funds, both states are pressing for swift resolution to ensure the Hudson Tunnel Project can move forward without further uncertainty.

The takeaway

This case highlights the ongoing challenges of securing federal funding for critical infrastructure projects, even when they are widely recognized as essential to regional and national transportation needs. The temporary halt in construction raises concerns about potential cost escalations and delays, underscoring the importance of stable, reliable funding to keep major projects on track.