The $16 billion Gateway Hudson River tunnel — two train tubes connecting New York and New Jersey — could halt on Feb. 6 unless the federal government releases funds it has held since last fall. The Gateway Development Commission has exhausted a $500 million Bank of America line of credit; a pause would affect four of five active sites and could trigger about 1,000 layoffs. Officials are weighing short-term measures, including a Port Authority letter of credit, but advocates warn that a suspension could jeopardize the entire project, recalling a similar collapse after New Jersey pulled funding in 2010.
Gateway Tunnel Work Could Halt Feb. 6 Without Federal Funds — 1,000 Jobs At Risk
Construction on the Gateway Program's Hudson River rail tunnel — a $16 billion project to build two train tubes linking New York and New Jersey — faces a planned pause on Feb. 6 unless the federal government releases funds it has withheld since last fall, according to a person close to the project who spoke on condition of anonymity.
The project is rapidly running out of cash. The Gateway Development Commission tapped a $500 million line of credit from Bank of America to keep work moving, but that cushion is now exhausted. If federal grant payments are not disbursed, roughly 1,000 workers could be laid off, including hundreds of construction laborers, and four of five active work sites would be affected; one site is funded separately by Amtrak.
What’s Causing the Delay
Administration officials signaled uncertainty during last year’s government shutdown and have sent mixed messages since about whether the withheld federal grant will be released. President Donald Trump has publicly described the project as “terminated,” while advocates including Senate Minority Leader Chuck Schumer say the tunnel urgently needs federal support. The federal government had previously committed — during the Biden administration — to cover the bulk of the project’s cost, but that pledge has not yet translated into the payments necessary to sustain construction.
Options Being Considered
The Gateway Development Commission will review the situation at a Tuesday board meeting. Advocates and officials have discussed stopgap measures to bridge the gap, including a potential letter of credit or other financial support from the Port Authority of New York and New Jersey. But it remains unclear whether state or regional agencies are willing or able to shoulder a larger share of a project that by design depends on substantial federal funding.
"It might buy time, but if it doesn’t solve the problem, even advocates for the tunnel aren’t sure it makes sense to do or not," said Tom Wright, president of the Regional Plan Association, who plans to testify at the meeting. Wright warned that pausing construction now could imperil the entire program: "When they cut the cord somewhere along the way, you can’t just pick it up a week or a month or six months later and say let’s get going again."
Why This Matters
The Gateway Tunnel is considered one of the nation’s most important infrastructure projects because it provides critical resilience and capacity for rail travel between Manhattan and New Jersey. A collapse or protracted stoppage would not be unprecedented: a prior version of the tunnel had a ceremonial groundbreaking in 2009 but unraveled after New Jersey withdrew funding in 2010, forcing workers to abandon partially excavated work.
Officials and advocates are racing to find a short-term fix to avoid layoffs and a costly interruption that could raise long-term costs and complicate federal-state cooperation. The board meeting will be closely watched by labor groups, regional planners and federal and state elected officials.
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