Tri-State Commission Sues Trump Administration Over Gateway Tunnel Funding

A regional commission representing three states is taking legal action against the Trump administration, claiming that it has halted funding for the $16 billion Gateway Tunnel project, which spans the Hudson River. This funding cut was allegedly made while the administration reviewed a contract it labeled as potentially “racist DEI.”

The Gateway Development Commission (GDC) filed the lawsuit late Monday in a federal court in Washington, asserting that the U.S. Department of Transportation violated their agreement by withholding over $205 million. They emphasize that the agency has until Friday to cease construction work.

In a recent press release, the GDC warned, “If additional funds aren’t made available by February 6, 2026, the Hudson Tunnel Project will have to be suspended, resulting in nearly 1,000 job losses.”

Back in October, President Trump hinted that funding might be cut for projects which aim to replace deteriorating rail tunnels that were affected by Hurricane Sandy. He stated that a review based on DEI criteria was required, though this was postponed due to the government shutdown.

According to a source at the time, “The current administration worries that the contracts in question might breach civil rights laws and the Constitution, as they were entered into under allegedly racist DEI principles.”

In response, the GDC contends that the Trump administration has a contractual duty to proceed with the deal, referencing a binding agreement made by both parties in July 2024.

White House representative Khush Desai stated to various media outlets last week that delays in funding were the fault of Senator Chuck Schumer (D-N.Y.) and other Democrats. Desai remarked, “Chuck Schumer and the Democrats are obstructing the Gateway Tunnel deal by refusing to negotiate with the Trump administration. There’s nothing preventing Democrats from prioritizing the needs of Americans over other interests and getting this program back on track.”

Since the lawsuit was filed, Schumer has aligned with New York Governor Kathy Hochul, New Jersey Governor Mikie Sherrill, and several other local politicians in support of the GDC.