NYC NOW - Gateway Tunnel Funding Restored After Shutdown, but Legal Fight Continues

Episode Date: February 25, 2026

Construction on the $16 billion Gateway tunnel project that aims to build a new set of train tunnels under the Hudson River shut down earlier this month after the Trump administration froze federal funding. More than a thousand workers were forced to walk off the job. A federal judge ordered the money released and crews are preparing to restart the work, but the case is still moving through the federal court system. WNYC transportation reporter Stephen Nessen and editor Clayton Guse explain how the project became a political flashpoint, what the pause revealed about federal funding and what it means for the commuters who rely on the aging tunnels every day.

Welcome to NYC Now. I'm Jenae Pierre. The largest and most vital passenger rail project in the U.S. is really being toyed with these days. The Gateway Tunnel project will replace the current century-old tubes serving NJ Transit and Amtrak trains heading to and from New York's Penn Station. Work on the project resumed this week, but could it get held up again? That's ahead on today's episode. But first, here's what's happening. in our region. New York City Mayor Zora Mamdani is naming a new head of the city's social services agency, which oversees homeless shelters and welfare benefits. Erin Dalton most recently ran human

services in Pennsylvania's Allegheny County, which includes the Pittsburgh area. In New York City, she will take over a massive portfolio, including shelters, street outreach services, and cash and food aid for millions of residents. She's replacing outgoing Commissioner Molly Waso Park, who resigned earlier this month. For a lot of New York City renters, even so-called affordable housing is getting too expensive. In a new report released this week, the Policy Group New York Housing Conference analyzed eviction lawsuits from 2024 and found more than a third of the city's 120,000 cases were filed by owners of government-subsidized affordable apartments. Rachel Fee runs the group. It's tens of thousands of households who are at risk of losing their affordable housing. We

want to make sure that they can retain that housing because they aren't going to have other housing choices in the market. Just a fraction of the cases resulted in an actual eviction, but the eviction proceedings placed pressure on tenants to pay back rent. Rachel Fee is calling on state lawmakers and city agencies to issue rental assistance much more quickly. To my fellow New Yorkers dealing with seasonal depression, I know it's hard, but keep your head up. It's unfortunate, but clinicians are reporting New Yorkers' seasonal blues are as extreme as this year's winter weather. But let's look ahead, shall we? By the end of March, folks can expect the sun to have organically restored their vitamin D levels and mood, banishing all of that sadness until

next winter. In the meantime, recommended treatment includes phototherapy, vitamin D supplements, and a consistent sleep schedule. Coming up, work on the Gateway Tunnel Project has resumed. There's been a lot of back and forth regarding the vital infrastructure project. I want to do two things. I want to feed my family and build something monumental like this tunnel. You know, this is my freedom tower, if you would. You know what I'm saying? This is the big one for me. So I've been here about nine months and I planned on being here nine years, but now here I am. So, you know, I worked really hard to get here on this job. I care about this job, right? I'm a third generation labor. And, you know, I think it's just complete BS. That's Mike Helstrom.

He's a construction worker who was forced to walk off the job a few weeks ago. That frustration you're hearing is tied to one of the biggest infrastructure projects in the country. We're talking about Gateway, a project to build the first new set of train tunnels under the Hudson River in more than a century. The existing train tunnels beneath the river were severely damaged back in 2012 during Hurricane Sandy. And experts say they're at risk of failure, and that will cut off commutes for some 200,000 people. But officials say those crossings can't be fixed while trains can't be fixed while trains can't. continue to use them. So the Gateway Project aims to build a new set of tunnels, so the old ones can eventually be closed for repairs. The cost of the plan is astronomical. I'm talking $16 billion.

It's one of the most expensive projects in the U.S. and funding the work has been a problem for two decades. Under President Biden, the project finally secured all the money needed to complete the project. But President Trump, acting on a personal vendetta against New York Senator Chuck Schumer for years has done his best to cut that funding. The project finally ran out of money earlier this month. And for a week, over a thousand workers at five massive job sites like Mike Helstrom were told not to show up. New York and New Jersey sued over the move.

A judge ordered the feds to release the funds. But it's not over yet. The case is still going through federal appeals court and there's no guarantee the judge's ruling will stick. To put it simply, y'all, we could be left with a bunch of holes in the ground instead of a new train tunnel. So how do we get here? I'm joined by WNYC's transportation reporter Stephen Nesson and editor Clayton Guseau. Hey guys.

Janay. Hello, Janay. So before we dive into the current state of the Gateway Tunnel Project, can you two help our listeners and me understand the scope of this project? So, yeah, in order to understand Gateway, you need to get your head around how hundreds of thousands of people. people travel between New Jersey and Manhattan every day. Drivers, of course, have the hollow end and Lincoln tunnels and the George Washington Bridge. And mass transit riders have the path, right? It's a relatively small subway system. But the main avenue is New Jersey Transit, which along with Amtrak, uses one set of tunnels that run into Penn Station. And those tunnels open for

service in 1910, right? And that old infrastructure is responsible for a lot of headaches for commuters. Yeah, yeah, I am certain. I know a bit about the summer of hell back in 2017 and my personal summer of hell back in 2024. Right. It's part and parcel to the same infrastructure. It dates back to when Penn Station was first built. And I should add, Jena, this isn't the first time a new tunnel has been floated or even started.

Before Gateway, there was ARC. That's a fun acronym that stands for Access to the Region's Corps. Okay. Rolls right off the tongue. Before my time here. So that was supposed to be this major expansion of NJ Transit Service. It would add more tracks at Sikakis Junction. That's a major bottleneck.

But they would allow more trains to run there. And of course, a new Hudson River tunnel was part of Arc. The plan would also add an expansion of Penn Station, just next to the existing one, near Macy's and Harold Square. Studies for that began in 1995. There was this six-year environmental review process, very extensive. And construction even started in 2000. The whole project was supposed to take a decade to complete. And if they did it, we wouldn't even be sitting here talking.

So what I'm hearing, Stephen, is the need for new tunnels that was needed before Hurricane Sandy in 2012. Absolutely. And work was well underway to get that new tunnel going. But then New Jersey elected a Republican governor by the name of Chris Christie in 2010. On the campaign trail, he said he supported the ARC project. But he changed his mind after winning the election. I simply cannot responsibly allow this to go forward. That's Governor Chris Christie speaking in October of 2010.

He worried New Jersey would be on the hook for most of the $8.7 billion price tag, as well as cost overruns. The easiest thing in the world would be for me to say, well, that's going to go forward and let whoever else is in this office in 2018 deal with the problem. That's not who the people in New Jersey elected. It's not who I am, and it's not the way I'm going to conduct myself in this office. How did New Jersey residents react to this back and forth of Chris Christie? There was a bit of a mixed reaction, but also like it's a very driving heavy state. And so Christie gave a handout to drivers. Right.

So certainly transit folks were very upset about this, advocates, especially in New York. But some people were okay with it. It was going to be expensive. And instead of using the state's contribution, which was $3.1 billion, he gave everyone a break on the gas tax. That unfortunately was very short-lived because the gas tax did go up in 2016. And it went up by 23 cents, which was a huge jump at that time, the first major increase in New Jersey in years. But at the time, for Christy, it was a winning issue, keeping taxes low for people. Of course, years later, we're still dealing with the consequences of that decision.

Yeah. And I'm sure Christy is still facing some criticism from that move, right? Yeah, it was monumental, and especially, you know, people in New York who were going to fund this project, gave him sharp criticism. But he also had a lot of valid concerns. The arc tunnel wouldn't go far enough to connect to other transit routes. Like the MTA just recently finished a long-delayed project called East Side Access, now known as Grand Central Madison. Right. And brought Long Island Railroad to this deep station beneath Grand Central. Previous proposals would have connected this tunnel to that, eventually creating a whole region-wide system. That was put on the shelf. And the Penn Station plan that Stephen was describing to expand it, that was also put on the shelf.

You know, without expanding Penn, the new tunnels wouldn't have allowed for more service for riders. So, Christy kills this. And two years later, Hurricane Sandy hits. Those old Hudson River train tunnels, the ones from 1910, were flooded. They sustained severe damage. So now this situation is even worse. It's even worse. But for major government elected officials like Senator Chuck Schumer, the hurricane wasn't just a tragedy. It was an opportunity. Here he is in October 2015, talking about how he'd rallied leaders on both sides of the Hudson around a new initiative called Gateway. Until now, it was as if

everyone was in their separate dugout, waiting for somebody else to move. Now we're all on the field. Everyone's on the same team. We're only in the first inning. So the original Hudson River Tunnel project formed under ARC, right, the one Christy killed, was billed as a capacity project to increase train service between New York and New Jersey. Now, after Sandy, Schumer is billing this project as a resiliency project. Officials started saying they needed to close the old tunnel completely for years in order to repair it. That's how they applied for money to the federal government. But because it's the only tunnel for NJ Transit and Amtrak beneath the Hudson, they would need to build a completely new one first in order to redirect the train traffic in the meantime. Then they could fix the old one. And when

it's all said and done, they just so happen to be left with an additional tunnel doubling their capacity. An extra tunnel. An extra tunnel just by accident. And we talk about capacity. I believe it's 24 trains an hour that use the existing tunnels. So now they can run 48. Yeah. That's the goal. So planning was underway during the Obama administration. Schumer helped get this bill pass to really kickstart the funding. And things seem to be on the right track. Yeah. No pun intended there. Never. who stands in the way will suffer politically for it. But it seems to me like this is a bipartisan project, right? Like who would be against something like this?

Infrastructure traditionally was very bipartisan. Republicans and Democrats generally supported these kinds of projects. They create jobs. It's the kind of useful thing government can really point to to say, hey, we did this. Right. But then President Trump won the election in 2016 and everything changed. He appeared to slam the brakes on any progress. All right, Stephen.

You're going to have to give me a dollar for every pun there. legally obligated to include as many train puns as I can. It's in the contract. I have to use a train-related pun. I apologize. Sorry. Trump seemed to have this petty grievance against his hometown of New York City, which, as we know, voted against him. And he had a particular grievance against the stalwart senator Chuck Schumer. That went back decades. Longtime Congress member Gerald Nadler, who represented parts of Manhattan for three decades, called it infantile. I've seen some press speculation. This is because of resentment that's the Schumer. Well, that's just infantile. You don't play around with the, with the, with the,

with the country that way. So Nadler couldn't believe that President Trump was as petty as he was. At that time, everyone was still naive and hopeful that maybe going to Washington would change him. And he would learn to play the game. Yeah. Infrastructure was supposed to be bipartisan, but it became a joke under the Trump administration. Remember every week was infrastructure week? Yeah. It was a joke. It was a punchline. And basically, Trump slowed down the process, almost stopped it entirely. Here's Senator Schumer again. There is no reason why gateway projects that are shovel-ready should wait for the signature of transportation to signature the Secretary of Transportation when we're racing against a doomsday clock. But the pendulum started to swing the other way when Joe Biden won the

election in 2020. He comes into the White House in 2021 and he gives hope to the transportation world. Yeah, you know, we remember Joe Biden leaving office with nicknames like Uncle Joe or Sleepy Joe, but he was known early on as Amtrak, Joe, right? Right. That dates back to his time in the Senate when he would commute to and from D.C. and Delaware every day to be with his kids. On the train. Right. On Amtrak. Yeah. So he comes into the White House with, you know, he has a majority in the House, majority in the Senate,

and he passes this landmark bipartisan infrastructure bill. It gave billions and billions and billions historic funding to Amtrak as well as states to build new train lines. And in 2023, he comes to New York City and announces the Gateway Tunnel Project would be fully funded, almost entirely by the feds through grants and loans.

It's sort of like a miracle. It is. And he was received as kind of got a hero's welcome by the old guard here. Hello, hello. Please have a seat if you have one. So it seemed, at long last, the work would move forward. It was a major win for people, especially like Chuck Schumer. Yeah. This would be his legacy infrastructure project.

For years, people talked about fixing this tunnel. But thanks to the leadership of Chuck and the bipartisan infrastructure law, we're finally getting this done. This law is the most significant investment in rail, the most significant investment in rail since we created Amtrak over 50 years ago. All right. So that's the story, right? That's the story. Have a good podcast. Construction started, and it's not like anyone could stop it at this point, or no.

Not exactly what, Janae. All right, we've got to take a pause for the cause. More on this gateway tunnel project saga right after this break. Stephen, what are we hearing here? This is the sound of construction underway on the New York side of the project. Crews are digging a trench that will eventually have a tunnel in it. Right now, it's all mud and muck. but you can see how eventually it will snake from Hudson Yards under the Westside Highway to beneath the Hudson River.

But this right here is really just the beginning. Full steam ahead. That's the obligatory train pun every minute and a half. Yeah. You know, we just heard about the decades of work it took to get to this moment, how former New Jersey Governor Chris Christie killed a previous plan to build a new train tunnel beneath the river. And how President Trump, during his first. term delayed another tunnel plan. Stephen, the work on the project was well underway when

Trump returned to office last year. So tell us what happens next. So right, work had been underway for nearly two years at this point. A billion dollars had been spent. There are holes in the ground. There's five different work sites under active construction. If you look in the middle of the Hudson River, there's a giant barge. And they're doing work in the middle of the Hudson River on this project. But last October, Democrats in Congress failed to come to a deal with Republicans over a spending bill. The Republicans hold the majority. The federal government shuts down.

And Trump blames his old nemesis, Chuck Schumer, the Senate Minority Leader from New York. Right as the government is about to close, Trump's budget director announces a surprise review of transportation projects that receive federal funding. He says he wants to pause funding to ensure recipients comply with these new rules, around so-called disadvantaged businesses. Basically, women... Coming for the DEI, folks. Women and minority-owned businesses. This is part of the ongoing battle.

But then, a week or so later at a press conference, Trump just said the quiet part out loud. The project in Manhattan, the project in New York, it's billions and billions of dollars that Schumer has worked 20 years to get. It's terminated. Tell them it's terminated. Wow.

So, you know, it seemed like it never... was about reviewing those contracts that you mentioned at all. Just like, you know, in his first term, Trump was using the Gateway Tunnels, Tumers, Legacy Infrastructure Project as a bargaining chip. Yeah, totally. And so from last October until late January, folks at Gateway said they had tried to play the game. They were emailing these documents back and forth with the Federal Transportation Department about their women and minority-owned business programs. They said they were compliant. with all these requests. And yet, the money still wasn't coming. The funding and the loans basically ran out. So what happened? So, you know how we kind of said that when Biden came into town,

he announced that this project was almost entirely reliant on federal money and federal loans. Well, you turn off the faucet, that money ran dry. And officials behind the Gateway Project began raising the alarm in late January. They announced it would have to stop work on February 6th, if the feds would not release the funding. The Gateway Development Commission has expended every resource to prevent any interruption to the construction, but we've gone as far as we can go. So that's Tom Prendergast. He's the CEO of the Gateway Development Commission.

It's running the project. Okay. So they start crying, chicken little. They're raising the alarm. Gateway files a lawsuit. So does the Attorney Generals of New York and New Jersey. They argued that the feds should be required to release the funds because they had already been approved.

And in legal filings, transit officials laid out how complicated it would be to stop the work. What's so interesting here is that essentially in legal filing documents, they say it would be a mega project in of itself to shut down the work. Wait, guys, let me get something straight here because it seems like instead of building a new tunnel project, officials would put what money was left into closing the job sites. I'm trying to make this make sense. That's basically right. Gateway officials said, if Trump doesn't release the money, if the federal government doesn't continue to fund this project, they're going to use what's left of it, and they're actually going to need a lot more money from the states of New York and New Jersey just to secure all these five locations that I described. There's this massive hole in the ground in Manhattan on the west side. There's holes in the ground in North Bergen, New Jersey. Eventually, if this project doesn't move forward, they're going to have to fill them in again. And by the way, one of those holes, the one in New Jersey, was actually starting. during the ARC project and had to be secured. So that's essentially working backwards.

So they're doing it going to work backwards twice. Wow. In addition, they're going to have to hire all these security guards to, you know, watch these places. And also, not even to mention these massive boring machines, these multi-billion dollar pieces of equipment are going to have to be stored. They're going to have to be heated so they're not damaged if they ever want to eventually use them again. Gateway officials currently have one of the machines, another one slated to be delivered

later this spring. and those were going to be used to dig the tunnels. They're custom made for this project, so they can't really be shipped to another job site. Wow. Wow. We might as well just get the tunnels for crying out loud. Might as well just go for it. Initially, a judge did not rule in time for February 6th.

So the deadline passed, work shut down. And crews on the job site were, let's say, pissed. I'm sure. I mean, now they're out of a gig. Totally. He's an egotistical maniac, Trump is, and he cares more about him and his name and his family than he does the American people. They fail to realize that when they do stuff like this,

how it affects our lives. Each and every guy out here works hard through all types of situations, whether it's the cold or the heat. And, you know, we just want to see this project go through. It's history. We want to be a part of it. Can I get your first and last names? Tracy Porter. And I should say, Jene, there's a little bit of irony here as well.

Really? Yes. Many blue-collar workers supported President Trump. I've been doing a lot of this reporting. I've been talking to these guys. And I walked up to some of them at a recent press event. And I asked point blank, did you vote for Trump twice? And they said, yeah, we did.

Union leaders confirmed that many of the rank and file voted for Trump. So I asked them, you know, this is the president you voted for who promised to bring back jobs to America. He's killing your job. And, you know, that sort of landed a little. uncomfortably, but everyone admitted as much and they weren't happy about it. Yeah, I mean, it seems like it could totally be a bite in the butt for someone that you voted for. Midterm elections are coming up too and, you know, this isn't going to look good. But the day of that February 6th deadline, things changed.

A federal judge issued an injunction in the lawsuit filed by New York and New Jersey and it said that the Trump administration needed to release the funds. And they eventually did just over a week after the project shut down. But it doesn't actually mean that work is. up and running this very moment. They have the money now. They're ready to resume, but we just had this massive snowstorm that slowed things down. They need to get the workers back on the job site. But they are expected to be back on track very soon. Okay, a lot of back and forth here. So I'm going to ask again. So that's that. Is the saga over now? Can this tunnel project finally move forward without any more obstacles? Well, the feds are still appealing the decision.

And if a federal appeals court doesn't side with them, they could take the case all the way to the Supreme Court. And in the meantime, Gateway isn't issuing any new procurements. They don't know if the funding for the project will be permanent or if Trump will maybe find another way to kill it. I mean, going all the way to the Supreme Court can take forever for this project to resume. Right. And if they don't issue any new contracts, that could slow things down. And when you slow things down, the economy inflates and the price tag could go up. I mean, this is also a political issue. It's one where some local Republicans are kind of breaking with Trump.

Congresswoman Nicole Malia Toccas, she reps Staten Island in parts of Southern Brooklyn. She's called for the funding to be restored. Mike Lawler up in the Hudson Valley a Republican. He's also looking at a contested midterm. He's kind of trying to say the funding should be restored. So it is a little bit of a bipartisan issue, at least on the local level here. All right. So what's next here?

Can New Jersey transit riders at least expect a new tunnel under the Hudson now? I mean, like we said, we're going to see how this plays out in court, but it is worth noting that Gateway is more than just tunnels. The tunnel project is the centerpiece, but the Gateway Development Commission, as it's been formed, also plans for billions of dollars in other work to improve service for New Jersey Transit and Amtrick riders in the area. What kind of other work? Right. So the big example is going on right now, and that's the Portal North Bridge. This is a really old crossing over the Hackensack River and it's a big pain point for riders over there. It swings open when boats at like swings, you know, open to let boats pass by, kind of an old-timey bridge. And it's so old that crews often need to use a sledgehammer to smack it back into place when it recloses after it opens. Yo, Clayton, you're talking old-timey.

It reminds me of a drawer in your kitchen that always gets stuck and you have to use like a hammer or something to slam it back in. Yeah, I got that drawer. I got that drawer. And basically that project is causing service headaches already, right? It's ongoing for New Jersey Transit and Amtrak while this bridge is being replaced. But unlike the tunnels, it relies more on funding from New York and New Jersey. We should say construction on that bridge is almost complete. So riders will experience some sort of improvement to their service.

That portal bridge often did get stuck, like the sledgehammer situation. So that should be one less bottleneck to worry about. Yeah, but that's not my hood. You know, there are several other track and bridge replacement projects as part of Gateway that are coming down the road. But the main piece, like we're talking about, the reason we're here today is this Hudson River tunnel. And the future of that is very much up in the air. And even when it's complete, it doesn't mean that we're going to see double the service overnight.

They need more trains and they need more space for those trains. And speaking of space, it sounds like they need to go to Penn Station. Exactly. And Penn Station right now is at capacity, right? It's cramped. It's the busiest rail station in the country. and in order to expand capacity between New Jersey and New York, Penn Station needs to expand as well. And the MTA for years was leading the project to overhaul it.

But last year, Trump announced Amtrak, Amtrak owns the station, would take over the work from the New York agency. And now they're moving full steam ahead on a plan to redevelop Penn. And the Trump administration is clearly seeing this as a potentially legacy project for the president himself. Oh, boy. During negotiations over the gateway funding, sources told us that White House officials offered to release the funding for the tunnel project if New York agreed to a mild concession. It would be to rename the train hub as Trump Station. Trump Station, Clayton. Oh, is anyone taking this seriously?

I mean, Trump likely is. He loves putting his name aside from the Trump administration. I mean, he's the president. He loves putting his name across New York. Look at all his real estate projects. over the past four decades. And his administration is also planning to pay for the redevelopment. Democrats like Governor Kathy Hockel have pushed back against the idea, right? And local Republicans have been notably silent. We know silence is a form of a response. Silence is a response.

Of course, you know, Trump may eventually realize that in order to justify this Penn Station project, he also is going to need those gateway tunnels. So all the pieces might finally come together. You know, this saga is slated to play out for at least another decade. The new tunnel is going to take at least another decade to build. And after that, they're repairing the old tunnels. That's expected to take a couple of years. And it's really unclear how long a Penn Station overhaul will take. Will either of us see any of these tunnels come to fruition?

If we're in New York for a long time, we'll be here. Janae, I hope we eat healthy and exercise. And we perhaps grow a little grayer than we're in. we are now, but we'll be sitting here at this table in 25 to 30 years talking about the great new Penn Station and those great new tunnels. Maybe we'll all live in New Jersey by then and have to use it. We'll have no choice. Well, climate change also, yeah, may make the move to New Jersey more appealing if more

of Manhattan is underwater. Wow. That's WMYC's transportation reporter Stephen Nesson and editor Clayton Gusa. Thanks, gentlemen. Thank you. And thank you for listening to NYC now. I'm Jene Pierre. See you next time.