Federal Court Orders Restoration of Funding for Hudson Tunnel Project

Tue Feb 10 2026 00:27:15 GMT+0200 (Eastern European Standard Time)

A federal judge has blocked the Trump administration's funding freeze on a critical rail tunnel project between New York and New Jersey, allowing construction to continue after potential job losses and delays were highlighted in court.

In a significant ruling for regional transit, U.S. District Judge Jeannette A. Vargas issued a temporary restraining order against the Trump administration's suspension of funding for the Hudson Tunnel Project. The case highlighted the urgent need for the new tunnel to reduce congestion caused by a century-old line. New York and New Jersey officials expressed relief at the decision, which they see as pivotal for commuters and economic stability in the region.

NEW YORK — A federal judge intervened on Friday to prevent the Trump administration from halting funding for the Hudson Tunnel Project, a key infrastructure initiative connecting New York and New Jersey. The ruling came just in time to avoid a halt in construction of the vital rail tunnel.

Months earlier, the administration had announced a $16 billion funding freeze for the project, citing concerns raised during a government shutdown and issues surrounding diversity and inclusion spending. The court's ruling came after New York and New Jersey filed for a temporary restraining order to unblock the funds while seeking a preliminary injunction.

U.S. District Judge Jeannette A. Vargas expressed that the plaintiffs demonstrated a case for irreparable harm if the freeze continued. The Court is persuaded that Plaintiffs would suffer irreparable harm in the absence of an injunction, she stated, emphasizing the project's importance for public interest.

New York Attorney General Letitia James commended the ruling, describing it as a crucial victory for workers and commuters. She stressed that the Hudson Tunnel Project is vital for the region's infrastructure, naming it a priority to avoid any federal obstructions as construction progresses.

Initially projected to cease construction, the Gateway Development Commission, responsible for the project, noted that halting operations could lead to significant job losses, with around 1,000 immediate job cuts and additional long-term impacts. The commission expressed they would restart operations as soon as the funding is reinstated.

The new rail tunnel aims to alleviate stress on an existing tunnel that has served for over a century, contributing to substantial delays for Amtrak and regional commuter services. With New York and New Jersey launching a legal challenge against the funding pause, discussions continue about the impact on future rail services.

The situation highlights ongoing tensions between state officials and federal lawmakers regarding crucial infrastructure funding, as the project seeks to enhance transit efficiency along the busy Northeast Corridor. The need for the tunnel has been further illustrated by ongoing safety concerns surrounding the antiquated infrastructure.