U.S. Freezes $18B for New York Transit Projects

The Trump administration announced a freeze of roughly $18 billion in federal funding for New York City infrastructure projects, chiefly the Hudson River Tunnel (Gateway) and the Second Avenue Subway. OMB Director Russell Vought said the hold, announced on the first day of a federal government shutdown, was to ensure money is not flowing “based on unconstitutional DEI principles” following White House orders scrutinizing diversity, equity and inclusion contracting. The Department of Transportation is reviewing whether New York’s minority- and women-owned-business set‑asides violate a new rule barring race- and sex‑based contracting requirements, and both projects — already under construction with prior multibillion-dollar federal grants — risk delays and jeopardized jobs if reimbursements and oversight stall. Furloughed federal staff amid the shutdown have slowed the DOT review and reimbursement process. New York leaders including Gov. Kathy Hochul and Senate Minority Leader Chuck Schumer condemned the pause and pledged to seek restoration of funds, while the administration and allies defended the action as necessary triage during the shutdown to protect essential services.