Construction activity on one of the country’s largest infrastructure projects may grind to halt by next week if federal dollars don’t begin to flow again.
The Gateway Development Commission said Tuesday work on the Hudson Tunnel Project will pause on Feb. 6 if federal funding disbursements do not resume in the coming days, according to a news release. The commission told contractors to wind down work at the active jobsites in New York and New Jersey.
“Since federal funding was paused in October, we have done everything in our power to keep construction moving forward as planned,” said GDC CEO Thomas Prendergast in a statement. “But we cannot fund this work on credit indefinitely.”
A construction pause on Feb. 6 would trigger the immediate loss of nearly 1,000 jobs, according to the GDC. An extended pause would put at risk approximately 11,000 construction jobs in addition to the $19.6 billion in economic activity the construction project would generate overall.
A freeze impacts four other major procurements that comprise the remaining construction packages for the new tunnel. Two construction packages that involve the Hudson River Tunnel Project and the New Jersey Surface Alignment Project were scheduled to start this year, but contracts cannot be awarded until funding resumes, according to the GDC.
Federal grants account for roughly $12 billion of the Hudson Tunnel Project, or 70% of its $16 billion budget. USDOT Build American Bureau loans, to be repaid by the states of New York and New Jersey and by the Port Authority of New York and New Jersey, fund the other $4 billion, according to the GDC.
Funding issues started on Sept. 30, 2025, when the GDC received notice from the Federal Transit Administration that federal disbursements under the Capital Investment Grants Program would be paused pending a review of the Commission’s federally mandated Disadvantaged Business Enterprise program. The following day, on Oct. 1, all federal funding for the Hudson Tunnel Project was halted.
The Trump administration has waged war on diversity programs and has targeted funding in Democratic-led areas. For example, in October, the Department of Energy canceled $7.56B in funds, largely in blue states.
Nevertheless, immediately following the administration’s announcement about the Gateway program’s funding then, construction didn’t stop.
Construction crews for New York City’s Gateway program continued to pour concrete after the announcement. Los Angeles-based Tutor Perini, the general contractor on the project, told Construction Dive then the firm was “unaware of any change in approach” and would be continuing onsite work.
Tutor Perini declined to comment on Tuesday’s announcement.
The GDC used other available funding sources and credit to keep the project moving forward. In fact, since Oct. 1, crews have hit notable milestones. That includes:
- The completion of the Tonnell Avenue bridge.
- Two major concrete pours totalling more than 7,200 cubic yards for the Hudson Yards Concrete Casing.
- 29 slurry wall panels for the Hudson County Access Shaft to reach 75% completion.
- 15 panels for the 12th Avenue Access Shaft.
- The procurement of two massive tunnel boring machines.
But that progress will now, presumably, stop.
“Pausing construction is the absolute last resort,” said Prendergast in the release. “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.”
The announcement drew sharp criticism from the New York Building Congress, a membership coalition of more than 500 organizations and 250,000 skilled professionals and tradespeople in the New York City area.
“The Gateway Development Commission’s announcement today of a possible pause on construction is a four-alarm fire that demands the immediate attention of an administration claiming to want to be the biggest builders this nation has ever seen,” said Carlo Scissura, president and CEO of the NYBC, in a statement. “The Hudson Tunnel Project is the most urgent infrastructure project in the country, and federal funding must be restored to keep construction moving.”
Scissura urged the Trump administration to resolve the matter sooner rather than later.
“Infrastructure should never be seen as partisan or political. It’s for everyone,” he said in the statement. “Our federal leaders must understand this and need to act now to fully restore funding to this vital project.”
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