NEWARK, NJ — New Jersey Governor Mikie Sherrill has launched a major legal challenge against the Trump administration, filing a federal lawsuit to restore funding for the Gateway Tunnel Project after the U.S. Department of Transportation froze billions of dollars previously approved by Congress.

Speaking at Newark Penn Station, Governor Sherrill called the funding freeze “arbitrary, capricious, and illegal,” warning that the decision threatens jobs, families, and the future of transportation for New Jersey residents. She vowed to block any attempt to derail the project, which she described as essential to the state’s economy and regional mobility.

The lawsuit, filed jointly by New Jersey and New York in federal court, argues that the Trump administration is unlawfully withholding more than $15 billion in federal funds that were already authorized and obligated for the project. State officials say the funding freeze could force construction to halt within days, potentially triggering layoffs and costly delays.

The Gateway Tunnel Project is a cornerstone infrastructure initiative designed to construct new rail tunnels beneath the Hudson River while rehabilitating the existing, aging tunnels that carry hundreds of thousands of commuters daily between New Jersey and New York City. Officials have long warned that the current tunnels, damaged during Hurricane Sandy, are operating at capacity and pose a serious risk of service disruptions without immediate upgrades.

According to state leaders, a shutdown of the project could put approximately 1,000 construction jobs at risk and severely impact the Northeast Corridor, one of the busiest rail routes in the nation. Transportation experts have warned that delays could ripple across the regional economy, affecting commuters, businesses, and supply chains throughout the tri-state area.

The states’ lawsuit claims the federal government has a legal obligation to release the funds because Congress already approved them and contracts have been executed. Attorneys are seeking emergency relief from the court to compel the Department of Transportation to resume payments immediately.

In addition to the states’ lawsuit, the Gateway Development Commission has also filed a separate legal action, accusing federal officials of breaching agreements and threatening the viability of the project by abruptly cutting off funding.

The legal fight highlights growing political tensions over infrastructure priorities and federal authority. New Jersey and New York officials contend the freeze is politically motivated and lacks a valid legal justification.

“This is about protecting working people and the future of our region,” Governor Sherrill said. “New Jersey will not back down.”

If the court does not intervene quickly, officials warn that construction sites could soon go idle, driving up long-term costs and worsening transportation challenges for millions of commuters who rely on the Hudson River rail tunnels every day.

Sources

New Jersey Governor’s Office

New Jersey Attorney General’s Office

Gateway Development Commission

ABC7 New York

NJ Spotlight News

Gothamist

Associated Press