US releases another $77 million in frozen New York tunnel funding

By David Shepardson

WASHINGTON, Feb 17 (Reuters) – The Trump administration has released another $77 million in frozen federal funding for the $16 billion Hudson Tunnel Project, New York Governor Kathy Hochul said on Tuesday, as a political battle over the critical infrastructure continued.

New York and New Jersey sued after the U.S. Department of Transportation withheld $205 million in funding for the project since October 1. The funding freeze triggered a halt to construction that put 1,000 workers out of work.

USDOT released $30 million on Friday, bringing the total released to $107 million. A spokesperson for USDOT said the agency is following the court order.

The Gateway Development Commission, which is overseeing the project, said on Tuesday that construction remained paused and it was working to “get workers back on the job to resume some construction as soon as possible.”

Republican President Donald Trump offered last month to unfreeze the funds, a source said, in return for support from Democrats to rename Washington Dulles Airport and New York’s Penn Station after him. Democrats strongly criticized the suggestion.

The Hudson Tunnel Project aims to build a new commuter rail tunnel connecting Manhattan and New Jersey and repair a century-old tunnel used by more than 200,000 travelers and 425 trains daily.

The existing Hudson Tunnel, heavily damaged by Hurricane Sandy in 2012, needs frequent emergency repairs that disrupt travel on the nation’s most heavily used passenger rail line.

Trump said on social media on Monday that he opposed the project, and was worried about billions of dollars in cost overruns.

“Gateway will likewise be financially catastrophic for the region, unless hard work and proper planning is done, NOW, to avoid insurmountable future cost overruns,” Trump said.

Hochul said she called Trump on Monday after his post and told him the project was not facing cost issues.

“It is urgent that we build this tunnel and do it now and stop these political delays,” Hochul said, calling on the administration not to impact future funding. “Imagine if something happens and this tunnel fails?”

U.S. District Judge Jeannette Vargas ordered the federal government to release funds for the project earlier this month.

The project was allocated about $15 billion in federal support under then-President Joe Biden, a Democrat. Nearly $2 billion has been spent so far.

(Reporting by David Shepardson; Editing by Nia Williams)