After Losing Four Times in Court, the Administration Appeals the Order Forcing It to Keep Paying for the $16 Billion Gateway Tunnel — a Project Trump Declared "Terminated" Because It Was Money "Schumer Has Worked 20 Years to Get"
On Friday, August 28, 2026, the Trump administration filed notice that it will appeal to the U.S. Court of Appeals for the Second Circuit a ruling by U.S. District Judge Jeannette Vargas that permanently barred the Department of Transportation from freezing federal funding for the Gateway Hudson Tunnel Project. Judge Vargas ruled on June 29, 2026 that the freeze violated federal law. It was the administration's fourth straight loss in the case, which New York and New Jersey brought in February 2026.
Gateway is a $16 billion program to bore new rail tunnels under the Hudson River and rehabilitate the existing 116-year-old North River Tunnel, the single two-track bottleneck carrying roughly 200,000 Amtrak and NJ Transit passengers a day between New Jersey and Penn Station. The federal share is $6.88 billion under a Capital Investment Grants full funding grant agreement signed before Trump returned to office.
The fight began on October 16, 2025, when Trump said of the money that Senate Democratic Leader Chuck Schumer had spent two decades securing, "Tell him it's terminated." The Transportation Department publicly disputed that the program was cancelled — Secretary Sean Duffy had called the projects "important" days earlier — but the department stopped reimbursing the Gateway Development Commission for completed work. By early February 2026 the commission had gone more than four months without payment and construction stopped, idling roughly 1,000 union workers. New York and New Jersey sued on February 3, 2026; a court blocked the freeze days later, and DOT released $235 million in withheld reimbursements on February 18. Work resumed. Judge Vargas made the block permanent on June 29.
The New York–New Jersey congressional delegation has been on this continuously — a January 28, 2026 letter led by Schumer, Kirsten Gillibrand, Cory Booker and Andy Kim warning the funds had to move before the February 6 stoppage, and a February 6 press conference in which nine members of the New Jersey delegation denounced the freeze as political retaliation. Rep. Rob Menendez said flatly that Trump froze the money "to target Democratic lawmakers."
Reaction to the August 28 appeal was near-uniform among the region's Democrats, who noted the administration's unbroken losing record. No Republican member of the New York or New Jersey delegation is on record supporting the appeal.
“Mr. President: keep the project on track, and support the hundreds of thousands of hard-working Americans who rely on this train line each and every day to get to work, appointments, and see friends and loved ones.”
infrastructure
transportation
gateway-tunnel