Construction on the Hudson Tunnel Project (HTP) has been suspended as of 5:00 PM on Feb. 7, 2026, after federal funding for the project was paused, halting four major procurements that make up the remaining construction packages. The pause immediately affects nearly 1,000 workers, and an extended suspension could put about 11,000 construction jobs at risk, along with the 95,000 jobs and $19.6 billion in economic activity the project is projected to generate.

Delays in completing the HTP also raise concerns about the North River Tunnel, a 116-year-old passage that serves as a major bottleneck for passenger rail traffic between New York and New Jersey. Officials warn that any extended shutdown could disrupt the country’s most heavily used rail line, causing widespread delays and billions in lost productivity.

The majority of the HTP budget comes from federal grants, including Capital Investment Grants, Federal-State Partnership Grants, RAISE grants, and Railroad Rehabilitation and Investment Financing loans. Construction has already received more than $1 billion in funding, but the federal government has withheld funds since October 1, 2025. In response, the Gateway Development Commission (GDC) filed a lawsuit in the U.S. Court of Federal Claims seeking the release of the contractually obligated grant and loan funds to resume construction.

The project, a key $16 billion passenger rail infrastructure initiative, relies on 70 percent federal funding, roughly $12 billion, with the remainder financed through state-backed loans. Federal disbursements have been paused since October 1, 2025, pending a review of the Commission’s Disadvantaged Business Enterprise (DBE) program.

Despite the funding freeze, GDC continued construction using available resources, completing major milestones including procurement of tunnel boring machines, progress on the Tonnelle Avenue bridge, concrete pours, and installation of hundreds of riverbed columns.

Before the pause, GDC CEO Tom Prendergast said the suspension was a last resort and that the team was working to restore funding to deliver reliable, modern rail infrastructure.

Hudson Tunnel Project Milestones

On December 15, 2025, the Gateway Development Commission announced at a board meeting that the first two tunnel boring machines for the Hudson Tunnel Project have finished manufacturing and factory acceptance testing, marking a key milestone in the project’s construction.

The commission said the machines will now be shipped to New Jersey for on-site assembly at the base of the Palisades in North Bergen. Components of the first tunnel boring machine are expected to arrive in January through Port Elizabeth in New Jersey and Baltimore in Maryland, before being transported by truck to the construction site.

Assembly and testing of the first machine

According to the commission, crews expect assembly and testing of the first machine at the North Bergen site to take approximately three months, keeping it on schedule to begin tunnel boring in the spring. Meanwhile, a second tunnel boring machine is scheduled to ship in early 2026, with components arriving at the site in March. Tunnel boring using the second machine should begin in the summer.

The two tunnel boring machines were custom-built for the project. They will excavate approximately one mile of new rail tunnel on the New Jersey side of the Hudson River. In addition, the machines will bore two parallel tunnel tubes simultaneously and install concrete tunnel liners as excavation progresses. Each machine should advance at about 30 feet per day.

Also, the commission reported that crews completed factory acceptance testing for the first tunnel boring machine in September, while they tested the second machine in early December.

The update came as part of a broader construction progress report covering five active Hudson Tunnel Project contracts. The commission also noted the completion of a bridge structure and the opening of a passage beneath Tonnelle Avenue, which crews required to deliver tunnel boring machine components to

Progress Update

Additionally, crews excavated the portal launch box at the base of the Palisades, started construction on the Hudson Yards Concrete Casing. Section 3 tunnel box, and conducted deep soil mixing operations in the Hudson River. Furthermore, the commission reported crews stabilized approximately 60,000 square feet of riverbed and shifted a temporary cofferdam east toward Manhattan to access a new section.

The commission also said workers installed guide walls and began slurry wall construction for access shafts in Hudson County, New Jersey, and along 12th Avenue in New York. They are also performing ground stabilization in Hudson River Park and on temporary marine structures in the Hudson River ahead of tunnel boring.

On May 20, 2025, the Gateway Development Commission reported that construction on Hudson Yards Concrete Casing – Section 3 (HYCC-3) has passed the halfway point, representing a milestone for the Hudson Tunnel Project.

Separately, other significant infrastructure projects have captured public attention. The White House recently announced that costs for its new Presidential Ballroom have climbed to $400 million, showcasing the challenges of executing large-scale construction in high-visibility settings.

The Gateway Development Commission completed manufacturing of the first pair of tunnel boring machines for the Hudson Tunnel Project, and crews will now ship and assemble them on site at the base of the Palisades in North Bergen, New Jersey. The Hudson Tunnel Project is one of the largest and most significant rail infrastructure upgrades in the United States.

Hudson Tunnel Project Factsheet

Major Milestone Achieved

The Gateway Development Commission (GDC) has completed manufacturing and testing of the first two tunnel boring machines (TBMs) for the Hudson Tunnel Project—the nation’s most urgent passenger rail infrastructure project.

TBM Specifications & Timeline

Purpose: Build approximately one mile of new rail tunnel on the New Jersey side of the Hudson River

Capacity: Two parallel tunnel tubes constructed simultaneously at 30 feet per day each

Features: Custom-built machines that install concrete tunnel liner during boring process

Delivery Schedule

TBM 1: Components arrive January 2025 (Port Elizabeth, NJ & Baltimore, MD) → 3-month assembly → Boring begins spring 2025

TBM 2: Ships early 2026 → Components arrive March 2026 → Boring begins summer 2026

Current Construction Activities

Tonnelle Avenue bridge completed, passage opened for TBM component delivery

Portal launch box excavation underway at Palisades base

Hudson Yards Concrete Casing (Section 3) construction started

60,000 sq ft of Hudson River riverbed stabilized through deep soil mixing

Access shaft construction initiated at Hudson County (NJ) and 12th Avenue (NY)

Ground stabilization in Hudson River Park and Manhattan bulkhead area