Infrastructure

Why Trump Terminated $16bn Hudson River Project

The tunnel aimed to replace century-old New Jersey-Manhattan rail links.

Updated on

November 18, 2025

Hudson River Project — The project was vital to the Northeast Corridor’s economy. (Photo: Courtesy)

US President Donald Trump recently announced the termination of the $16 billion Hudson River rail tunnel project, one of the most ambitious infrastructure schemes in the country.

Trump said the administration was ending projects that “we never wanted”, but officials later confirmed the real reason was linked to a dispute over diversity and equity rules in federal funding.

The Office of Management and Budget (OMB) has frozen nearly $18 billion in federal aid for major New York projects, including the Hudson River tunnel and the Second Avenue Subway extension.

OMB Director Russ Vought said the review aims to ensure “funding is not flowing based on unconstitutional DEI principles”.

The suspension followed claims that New York’s contracting process may breach federal rules by prioritising diversity, equity and inclusion (DEI) standards in bids.

The Hudson River Tunnel, part of the long-planned Gateway Program, was designed to replace century-old rail links between New Jersey and Manhattan that carry hundreds of thousands of passengers each day.

The project had already received billions in federal support and was regarded as essential to the economy of the Northeast Corridor.

At the White House on 15 October, President Trump told reporters: “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.”

His statement provoked immediate criticism from Democratic leaders in New York and New Jersey, who accused the administration of turning transport policy into a political weapon.

Senate Majority Leader Chuck Schumer called the decision “vindictive, reckless, and foolish”, adding: “Gateway is the most important infrastructure project in America, period.”

New York Governor Kathy Hochul said the move was “an attack on common sense”, accusing Washington of “putting culture wars ahead of the needs of a nation”.

Although President Trump described the project as terminated, federal officials said it remains under review rather than fully cancelled.

Funding could be restored if the state adjusts its contracting terms to meet federal standards. For now, the freeze has left one of the country’s most important rail projects in limbo and raised fresh doubts over the future of America’s infrastructure ambitions.