The basics:
- Federal government freezes funding for $16B Hudson Tunnel Project
- Nearly 1,000 jobs lost immediately; 11,000 construction jobs at risk
- GDC and NJ, NY file lawsuits
- Remaining construction packages on hold until funding restoration
The Gateway Development Commission announced suspending construction on the $16 billion Hudson Tunnel Project Friday.
The Feb. 6 pause comes as the federal government continues to freeze funding previously committed to the work. Stopped since Oct. 1, the Trump administration says its action pertains to concerns over the project’s Disadvantaged Business Enterprise program.
The stoppage will cause the immediate loss of nearly 1,000 jobs. An extended delay puts roughly 11,000 construction jobs at risk, along with 95,000 total jobs and $19.6 billion in anticipated economic activity tied to the project. The DBE initiative is under review.
On Feb. 5, Punchbowl news reported the president wanted Dulles Airport and Penn Station named after him as a condition to release the funds. The offer reportedly did not land.
As NJBIZ has reported, GDC warned that without the funding, work would halt Feb. 6.
The project manager also filed suit against the Trump administration for breach of contract. The next day, New Jersey and New York followed with a claim of their own.
A setback, but not the end
“For more than two years the hardworking men and women building the Hudson Tunnel Project have not missed a day of work,” said GDC Chief Executive Officer Tom Prendergast. “That changes today, because the federal administration continues to withhold funding for this vital investment in our nation’s rail infrastructure.
“After spending more than $1 billion, and countless hours of hard work, on this project, we will be left with empty construction sites in New York and New Jersey.”
GDC said construction will officially pause at 5 p.m. Feb. 6 without the resumption of disbursements. Until the restoration of funds, the organization also said it will pause four procurements comprising the remaining construction packages for HTP.
“Today is a setback, but it is not the end,” said Prendergast. “To those who have long championed the project, our workforce, and the riders who are relying on GDC to finally deliver the modern, reliable commute they deserve: know that our work is far from over. GDC will continue to do everything in our power to get our funding restored and deliver the most urgent infrastructure project in the country.”
More to come
“2026 was supposed to be a year of major milestones for the Hudson Tunnel Project. Tunnel boring was supposed to start in New Jersey,” said New Jersey GDC Commissioner and co-Chair Balpreet Grewal-Virk. “Two major construction contracts were going to be awarded, creating tens of thousands of new jobs. Instead, nearly 1,000 workers are losing their jobs, and our construction sites are turning into ghost towns because our federal funding is being withheld.
“In the days and weeks ahead, GDC is going to continue doing everything we can to get funding restored so the many hardworking men and women employed by the Hudson Tunnel Project can get back to work, and we can go back to celebrating milestones on the way to delivering this urgently needed new tunnel.”
Gov. Mikie Sherrill, congressional delegation members as well as other project and labor leaders and stakeholders plan to hold a press conference about the situation Friday.
‘We are not going to stand for it’
A slew of Jersey leaders, including Sherrill, members of the congressional delegation, labor representatives, union workers and more, gathered in Weehawken to discuss the situation.
“You’re seeing a president who has moved the goalposts again and again and again for 1,000 people that are employed on this project – who are going to have to go home today and tell their families that they don’t have a job on this site,” said Sherrill. “Because the President of the United States has decided to play politics with their job, has decided to play politics with our economy, has decided that politics are more important to him than the working men and women of this country.
“And I’m telling you – here in New Jersey – we are not going to stand for it. We are drawing the line here. We are in court today. We have sued the president.”
Sherrill laid out the impact and importance of the project – including the jobs, economic impact and more.
“Why he would attack that – I do not know,” said Sherrill. “But I will tell you what I’ve heard. I’ve heard its because he wants Dulles Airport named after him. I’ve heard it’s because he wants Penn Station named after him. I’ve heard that that’s what he cares about more than the people on this job site.
“That’s not who we’re fighting for. We’re not fighting for ourselves. We’re fighting for our country. And we’re fighting for working men and women here in New Jersey.”
‘Political hostage-taking’
Sherrill said that’s her commitment.
“I was called, when I was in Congress, the tunnel-obsessed congresswomen,” said Sherrill. “I thought that I could move forward on other projects. But I will tell you, I remain the tunnel-obsessed governor. And I will remain so until this tunnel is finished.”
U.S. Sen. Cory Booker, D-NJ, said today is a day that should outrage every New Jerseyan and everyone in the region.
“We have a president who is literally holding one of the most important infrastructure projects of the last century hostage because of his wannabe king, petty, personal, vindictive, cruel policies,” said Booker.
“This is sabotage. This is political hostage-taking. This is actually one of the worst acts of extortion I’ve ever seen.”
The Trump administration has not responded to a request for comment and has not weighed in publicly on the project suspension as of this writing.
Businesses rely on modern transportation
Business leaders in New Jersey are calling for the project to get back on track.
“Today’s announcement is a major disappointment for New Jersey commuters, our business community, and for our economic outlook,” said New Jersey Business & Industry Association President and CEO Michele Siekerka. “NJBIA has long believed the infrastructure improvements coming from this project are absolutely necessary for our long-term economic progress.”
She said that the state’s competitiveness is reliant on a modern, accommodating and safe transportation system – and stressed that delivery of the project is a crucial part of that mix in the state and regionally.
“We urge all parties continue to work at getting this project back on track, without the burden of politics,” said Siekerka. “For the good of our economy, this major and essential infrastructure investment needs to happen.”
‘Unlawful’
New Jersey Chamber of Commerce President and CEO Tom Bracken said the Trump administration must immediately restore funding for the project – and called the pause unlawful.
“Gateway is essential to our region’s economy and to the millions of commuters who depend on reliable rail service every day,” said Bracken. “This project is already supporting nearly 1,000 construction jobs and will ultimately create tens of thousands more while generating billions in economic activity.
“Halting work now puts hardworking families out of work, wastes over $1 billion already invested, and risks higher costs and long delays,” said Bracken. “Gateway is on time, under budget, and delivering real results. New Jersey’s business community will not accept this setback.
“Withholding these funds is unlawful, and the Administration must act now to restore funding and keep this critical project moving.”
This is a developing story, please stay with NJBIZ for the latest.
Editor’s note: This story was updated at 11:22 a.m. Feb. 6, 2026, to include additional details and reactions regarding the Gateway Program development. It was updated again at 1:12 p.m. with further comments from elected officials and business group leaders.
The post Hudson Tunnel Project halted amid Trump funding freeze (updated) appeared first on NJBIZ.
