Federal Funding Restored for Gateway Tunnel Project After Standoff

Construction to resume on $16 billion Hudson Tunnel Project, restoring nearly 1,000 jobs

Feb. 25, 2026 at 4:09pm

Got story updates? Submit your updates here. ›

After a funding standoff with the Trump administration, construction on the Gateway Tunnel project between New Jersey and New York City will restart this week. The $16 billion project, which aims to build a new train tunnel under the Hudson River, was stalled for months after the White House froze billions in federal funding. However, a federal judge has now ordered the release of the funds, allowing work to resume on the critical infrastructure project.

Why it matters

The Gateway Tunnel is a vital transportation link between New Jersey and New York, serving over 200,000 passengers on more than 400 trains each weekday. The existing 110-year-old tunnel has been plagued by constant issues, making the new tunnel project essential for the region's economy and commuters. The funding standoff had threatened to further delay this crucial infrastructure upgrade.

The details

The Gateway Development Commission, a bi-state public authority overseeing the project, along with the states of New Jersey and New York, filed lawsuits to compel the Trump administration to release the frozen federal funds. A federal judge has now ordered the government to unfreeze the funding, allowing construction to restart this week. The initial phase of work will include excavation, assembling tunnel boring machines, and preparing the construction sites on both sides of the Hudson River.

  • Construction on the new tunnel started in November 2023.
  • Federal funding for the project was frozen in October 2025.
  • A federal judge ordered the release of funds earlier this month.
  • Construction is set to resume this week.

The players

Gateway Development Commission

A bi-state public authority overseeing the Gateway Tunnel project.

Donald Trump

Former President of the United States who froze federal funding for the project.

Balpreet Grewal-Virk

New Jersey GDC commissioner and co-chair.

Mikie Sherrill

Governor of New Jersey.

Joe Biden

Current President of the United States who has supported the Gateway Tunnel project.

Got photos? Submit your photos here. ›

What they’re saying

“We are incredibly thankful for Gov. Mikie Sherrill, New Jersey's congressional delegation, and the many other leaders who have called on the administration to stop delaying the most urgent infrastructure project in the country. We're seeing the results of this effort now, as hundreds of workers go back to our construction sites.”

— Balpreet Grewal-Virk, New Jersey GDC commissioner and co-chair (Patch.com)

What’s next

The Gateway Development Commission plans to continue excavation, assemble the first tunnel boring machine, and coordinate the delivery of the second machine. They will also continue slurry wall installation, begin excavation of the Hudson County Access Shaft, and construct a marine platform for work associated with the Manhattan Tunnel.

The takeaway

The restart of construction on the Gateway Tunnel project is a significant victory for the region, as it will restore nearly 1,000 jobs and help address one of the most critical transportation bottlenecks in the Northeast Corridor. This project's successful completion will have far-reaching benefits for commuters, the local economy, and the nation's infrastructure.