Trump administration puts on hold $18 billion in funding for New York City infrastructure projects

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WASHINGTON (AP) — President Donald Trump's administration said Wednesday it was putting a hold on roughly $18 billion to fund a new rail tunnel beneath the Hudson River between New York City and New Jersey and an extension of the city's Second Avenue subway because of the government shutdown.

The White House budget director, Russ Vought, said on a post on X that the step was taken due to the Republican administration’s belief the money was based on unconstitutional diversity, equity and inclusion principles.

In a statement, the U.S. Transportation Department said that it had been reviewing whether any “unconstitutional practices” were occurring in the two massive infrastructure projects but that the government shutdown had forced it to furlough the staffers conducting the review.

"This is another unfortunate casualty of radical Democrats’ reckless decision to hold the federal government hostage to give illegal immigrants benefits," the statement reads.

The suspension of funds is likely meant to target Senate Democratic leader Chuck Schumer of New York, whom the White House is blaming for the shutdown.

In a 2023 interview with The Associated Press, Schumer said he and then-President Joe Biden were both “giddy” over the rail tunnel project, adding that it was all they talked about in the presidential limousine as they rode to the site.

Schumer bristled that the Trump administration's funding freeze would harm commuters.

“Obstructing these projects is stupid and counterproductive because they create tens of thousands of great jobs and are essential for a strong regional and national economy,” he declared on X.

At a news conference in New York City about the federal government shutdown, Gov. Kathy Hochul, a Democrat, told reporters, “The bad news just keeps coming,” adding that "they’re trying to make culture wars be the reason why.”

“That’s what a partnership with Washington looks like as we’re standing here. We’ve done our part. We’re ready to build. It’s underway,” she said. “And now we realize that they’ve decided to put their own interpretation of proper culture ahead of our needs, the needs of a nation.”

The Hudson River rail tunnel is a long-delayed project whose path toward construction has been full of political and funding switchbacks. It’s intended to ease the strain on a 110-year-old tunnel connecting New York and New Jersey. Hundreds of Amtrak and commuter trains carry hundreds of thousands of passengers per day through the tunnel, and delays can ripple up and down the East Coast between Boston and Washington.

Amtrak and the NJ Transit commuter rail system referred questions about the White House's announcement to the Gateway Development Commission, which is overseeing the tunnel project. Commission CEO Thomas Prendergast said the agency remains “focused on keeping the project on scope, schedule, and budget.”

The commission didn't address questions about the specifics of the funding suspension or what it means for the project.

The Trump administration specifically targeted New York City in putting a hold on the funding, but the move could also influence this year's gubernatorial election in New Jersey.

Rep. Mikie Sherrill, a New Jersey Democrat who's running for governor, said in a post on X that as governor she would "fight this tooth-and-nail and sue the Trump administration to finish this critical, job-creating infrastructure project to reduce congestion and improve quality of life in New Jersey.”

The campaign of the Republican nominee for governor, Jack Ciattarelli, did not immediately respond to questions about the freeze on the tunnel project.

The Second Avenue subway was first envisioned in the 1920s. The subway line along Manhattan’s Second Avenue was an on-again, off-again grail until the first section opened on Jan. 1, 2017. The state-controlled Metropolitan Transportation Authority is working toward starting construction on the second phase of the line, which is to extend into East Harlem.

A message seeking comment on the funding freeze was sent to the MTA.

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Associated Press writers Anthony Izaguirre in Albany, New York, and Jennifer Peltz in New York contributed to this report.