Trump Administration Halts $18B Funding for Hudson River Tunnel Amid Government Shutdown

The Trump administration has halted nearly $18 billion in federal funding for two major New York infrastructure projects—the Hudson Tunnel and the Second Avenue Subway expansion—citing concerns over unconstitutional diversity, equity, and inclusion (DEI) contracting practices. White House Budget Director Russ Vought stated that the freeze ensures no funding flows based on such DEI principles, linking the move to a broader political struggle during the ongoing federal government shutdown. This funding suspension has prompted criticism from New York and New Jersey officials, including Gov. Phil Murphy and Gov. Kathy Hochul, who emphasize the projects' importance for millions of commuters and job creation and call for the projects to be kept above politics. The U.S. Department of Transportation has initiated a review to determine if race- or gender-based criteria were improperly used in awarding contracts, delaying reimbursements and complicating progress amid furloughs of civil rights staff. While the projects continue short-term work due to existing budgets, the funding freeze introduces significant uncertainty for the Gateway Program and related transit expansions, which have faced decades of delays and political challenges. The dispute reflects heightened tensions between the Trump administration and Democratic lawmakers, with the administration using fiscal control as leverage in shutdown negotiations.