Construction on the massive $16 billion Hudson Tunnel Project will resume next week after the Trump administration on Wednesday released $127 million in frozen funding, New York Governor Kathy Hochul said.
New York and New Jersey sued after the U.S. Department of Transportation had withheld $205 million in funding for the project since October 1. The funding freeze triggered a halt to construction on February 6 that put 1,000 workers out of work.
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.
“A major win for workers and commuters,” Hochul said on social media. “We’ll keep fighting to ensure the federal government meets its commitments.”
The Department of Transportation did not immediately comment on Wednesday whether it plans to withhold future funds for the project.
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 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.
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.