TAMPA, Jan 29, 2026 — Construction on the $16 billion Hudson Tunnel Project, a critical rail link under the Hudson River between New York and New Jersey, is set to halt next week unless federal funding resumes, the Gateway Development Commission (GDC) has warned.
The project, which aims to replace and augment the century-old North River Tunnel used by Amtrak and NJ Transit, faces a pause on 6 February, putting thousands of jobs at risk and potentially wasting billions of dollars in taxpayer funds already invested.
In response, White House spokesman Kush Desai issued a statement to NCE, blaming Democrats for the delay.
“It’s [Democratic senate leader] Chuck Schumer and Democrats who are standing in the way of a deal for the Gateway Tunnel Project by refusing to negotiate with the Trump administration. There is nothing stopping Democrats from prioritising the interests of Americans over illegal aliens and getting this project back on track,” Desai said.
The Hudson Tunnel Project, also referred to as the Gateway Development Programme, secured $11 billion in federal funding last July—the largest allocation for any rail project in U.S. history—backed by the Biden-Harris Administration and the Bipartisan Infrastructure Law. However, funding was halted by Trump on 15 October, as part of a government shutdown that affected multiple programs and led to mass layoffs.
Since then, GDC has continued construction using available credit and alternative funding to maintain progress. “Without additional funding, work must stop on 6 February,” the commission said. To date, more than $1 billion of federal funds have been spent, and pausing construction immediately threatens nearly 1,000 jobs, with a longer halt putting 11,000 construction jobs at risk.
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GDC has made significant headway on multiple construction fronts. The organization has:
GDC contractors have been notified of the impending funding shortfall and will spend the next two weeks winding down active sites in New York, New Jersey, and the Hudson River. Lead contractor MPA Delivery Partners—featuring Mace, Parsons, and Arcadis—is responsible for major ongoing construction.
Four remaining procurement packages are also affected. Two key packages, the Hudson River Tunnel Project and the NJ Surface Alignment Project, are planned for 2026, but contracts cannot be awarded until federal funds are released.
The new twin tunnels will link Secaucus Station in New Jersey to Penn Station in Manhattan, replacing the century-old North River Tunnel, which suffered major damage during Superstorm Sandy in 2012. The existing tunnel carries 450 trains daily, making full repairs impossible without an alternative route.
GDC CEO Thomas Prendergast emphasized the project’s importance and the efforts to continue construction despite funding challenges.
“Over the past two years, GDC, together with our federal and state partners, have made significant progress building the most urgent passenger rail infrastructure project in the country. The progress we have made since the project started construction would not have been possible without the support of the federal Administration. Since federal funding was paused in October, we have done everything in our power to keep construction moving forward as planned, but we cannot fund this work on credit indefinitely. Pausing construction is the absolute last resort, and we will continue working around the clock to secure funding so that the workers who are counting on this project to pay their bills can stay on the job and we can continue delivering the reliable, 21st-century infrastructure America needs.”
Originally reported by Thomas Johnson in New Civil Engineer.
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