A federal judge in New York on Friday issued a temporary order barring the Trump administration from continuing to withhold money for the Gateway project, hours after attorneys for New Jersey and New York faced off with the Trump administration in court over the frozen funds.
Attorneys general for both states cheered the decision, with acting New Jersey Attorney General Jen Davenport saying the order should ensure that construction will continue on the $16 billion project to build new rail tunnels under the Hudson River.
“As the court correctly recognized, the Trump Administration’s attempts to freeze funding for the Gateway Tunnel project are plainly illegal, and they would cause grave harm to New Jersey and New York. We are grateful that the court agreed to put a halt to this unlawful freeze on this emergency basis,” Davenport said in a statement.
The two sides appeared before Jeannette Vargas of the Southern District of New York earlier Friday.
President Donald Trump halted funding for the rail project in September. Since then, the Gateway Development Commission, which oversees the project, has been paying for continued construction using a line of credit that the commission said lapsed on Friday.
New Jersey and New York sued to force the Trump administration to unfreeze the funds. The states argued before Vargas Friday that they face harm if construction were to halt.
“Once shovels are down, project sites simply can’t be abandoned. There is a massive hole in the ground in North Bergen and a 1,600 ton boring machine just sitting there,” said Shankar Duraiswamy, deputy solicitor general for the New Jersey Office of Attorney General. “The entire project could be imperiled. We need safe, secure, and reliable train service across the Hudson.”
Tara Schwartz, an assistant U.S. Attorney representing the federal government, argued that the Gateway Development Commission is funded by the states, the federal government, and Amtrak, and said there is “no reason” why the states can’t provide additional funds while federal funding remains frozen.
The Trump administration has offered numerous explanations for why it halted federal funding for Gateway, most recently by using it as a bargaining chip to get U.S. Senate Democrats to agree to GOP spending proposals for the U.S. Department of Homeland Security.
The Gateway commission earlier this week filed a separate lawsuit alleging the Trump administration improperly froze funds for the project.
The Gateway project is designed to ease congestion between New Jersey and Manhattan, and allow crews to rehabilitate the aging tunnels currently in use, which date to the Taft administration.
The Gateway commission said halting work on the project would lead to the immediate loss of close to 1,000 jobs, with thousands more jobs potentially gone if the construction pause continues.
Nearly $2 billion has already been spent on the project, according to the commission.
— Mark J. Bonamo, New Jersey Monitor, February 6, 2026
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