The U.S. Department of Transportation (USDOT) and Amtrak on Wednesday August 27, 2025 announced the next phase of New York Penn Station’s long-awaited overhaul, unveiling a $7 billion redevelopment plan and a timeline that calls for construction to begin by the end of 2027.
The federal-led project will be advanced through a public–private partnership, with Amtrak serving as lead developer, following USDOT’s decision earlier this year to shift control of the station’s reconstruction from New York State to Amtrak.
Project Timeline
Aug. 27, 2025 – Advance notice of master developer solicitation
Fall 2025 – Engagement with contracting industry stakeholders
Late 2025 – Issuance of master developer solicitation
May 2026 – Master developer selection
Summer 2026–End of 2027 – Initial design and NEPA environmental review
End of 2027 – Start of construction
Additionally, the Federal Railroad Administration (FRA) will begin an 18-month Service Optimization Study in October to determine how Penn Station and its environs can handle anticipated passenger growth.
Federal Role
USDOT passed leadership of the redevelopment from Amtrak to the Metropolitan Transportation Authority (MTA) in April 2025, removing the MTA from the project. Amtrak owns the station, the busiest rail station in the Western Hemisphere.
Transportation Secretary Sean P. Duffy designated the current state of the station as substandard.
“Crumbling infrastructure, dark and grimy architecture, untraversable hallways, and no welcoming areas for families with children – the current Penn Station is unacceptable,” he said. “Led by President Trump, we will make Penn Station a world-class transportation facility that is beautiful, safe, and clean.”
Amtrak advisor Andy Byford reported the agency is committed to sticking with the federal timeline. “USDOT and Amtrak are strongly committed to beginning construction by the end of 2027,” he wrote.
Amtrak is enhancing its infrastructure through major yard modernization efforts in Boston, New York (Sunnyside Yard), and Washington, D.C., investments in track, bridge, and station accessibility upgrades across the Northeast Corridor, and accessibility projects nationwide—while exploring a proposed “Transcontinental Chief” 72-hour Los Angeles-to-New York rail service.
Cost and Financing
Federal authorities put the cost of the Penn Station Revitalization at $7 billion. The figure is below prior state projections that were up to $8 billion under a plan proposed by former Governor Kathy Hochul. That plan had been contingent on mutual city–state ownership and funding from payments in lieu of taxes (PILOTs) on nearby commercial projects.
In November 2024, USDOT awarded a $72 million federal grant to support early design and engineering. Under the transition, the FRA rescoping of funds was said to save taxpayers about $120 million.
The current federal funding plan includes:
A public–private partnership arrangement with Amtrak in a leading role.
Recourse to PILOT receipts generated by commercial development, estimated to bring in around $4.1 billion over the life of the project.
Other capital requirements between $3.4 billion and $5.9 billion, possibly funded by debt or alternative sources of investment.
Penn Station serves more than 12 million Amtrak passengers annually—approximately 18% of Amtrak’s total ridership and 45% of its Northeast Corridor traffic. Moreover, over 1,000 Amtrak, NJ TRANSIT, and Long Island Rail Road trains per day use its 21 tracks.
USDOT officials said the expected redevelopment is for the purpose of improving operations, enhancing flow of passengers, and responding to forecasted ridership expansion.
USDOT, Amtrak Outline Penn Station Overhaul Timeline: Project Factsheet
Project Overview
Total Investment: $7 billion
Lead Agency: U.S. Department of Transportation (USDOT) & Amtrak
Project Model: Public-Private Partnership
Developer: Amtrak (Lead)
Why the New York Penn Station Redevelopment Project Matters
Penn Station is the busiest rail hub in the Western Hemisphere, serving:
12+ million Amtrak passengers annually (18% of total Amtrak ridership)
45% of Northeast Corridor traffic
1,000+ daily trains across three operators (Amtrak, NJ TRANSIT, LIRR)
21 tracks in current configuration
Financing Structure
Federal Investment:
$72 million federal grant awarded (November 2024)
$120 million taxpayer savings through federal rescoping
Revenue Sources:
$4.1 billion from PILOT payments (commercial development)
$3.4–5.9 billion additional capital needs (debt/investment)
Project Goals
Transform Penn Station into a “world-class transit hub” addressing:
Crumbling infrastructure and poor passenger experience
Inadequate circulation and navigation
Projected ridership growth
Safety and cleanliness concerns
