New Jersey Gov. Mikie Sherrill said she talked to President Donald Trump last week before a lawsuit was filed by her state and New York seeking to free up billions of dollars for the Gateway Tunnel project. Those funds were frozen last October by the Trump administration.
Sherrill, speaking during a news conference at Newark Penn Station on Wednesday afternoon, said taxpayers will be on the hook for millions of dollars if construction shuts down as scheduled on Friday, when the project runs out of cash.
“To avoid this, we’re seeking emergency relief by Friday Feb. 6 and other relief later this month to ensure construction continues on the most important infrastructure project in the nation,” acting New Jersey Attorney General Jennifer Davenport said.
Thousands of workers still on the job at five projects face lay-offs, in addition to the 11,000 expected to resume working in the spring.
The withheld funds were approved in contracts with federal agencies in 2024.
Referring to Trump’s Oct. 15 statement that Gateway is “terminated,” Sherrill said his action is “arbitrary, illegal and I refuse to let it happen.
“When he’s involved costs go up and people get hurt. State taxpayers will get stuck paying millions more. The decision to suspend all project funds violates careful federal regulations that limit whether and when agencies can freeze project funds.”
Sherrill, a Democrat, said she told Trump during a phone call late last week that Gateway was critical to the region for jobs and the economy.
After she listed reasons why the project should continue, he replied “I know how important it is,” but didn’t offer to restore funding, Sherrill said.
“There has been no credible explanation for the hold-up other than political games and moving the goal posts,” she said.
New Jersey and New York sued the Trump administration Tuesday contending it will put taxpayers on the hook for millions of dollars in additional costs. The Gateway Development Commission, which is overseeing construction, filed a breach of contract suit in federal court on Monday.
Under agreements with the Federal Transit Administration, the two states are responsible for covering costs beyond the $16 billion allocated for the project.
Those costs were estimated by the commission at $15 million to $20 million a month.
That figure includes costs to secure the five sites under construction, for contractors to move equipment and interest payments for lines of credit Gateway used to keep construction going for four months after federal funding was frozen on Oct. 1.
While Sherrill and her attorney general talked about the twin lawsuits filed by the states and Gateway, U.S. Rep. Josh Gottheimer, D-5th Dist., said he was still working with legislators on both sides of the aisle and the White House to negotiate release of the funds.
Echoing the reasons Sherrill provided for the suit, Gottheimer said he is still working with other lawmakers and the White House on a legislative settlement.
“I will not leave the table. I helped negotiate the bipartisan infrastructure bill. We can do this if we grind it out as the lawsuit moves forward,” he said during a Wednesday morning press conference.
Gateway would build two new tunnels under the Hudson, rehabilitate the two existing tunnels and build other infrastructure. The 116-year-old tunnels are a notorious choke point and require constant maintenance, usually done overnight and by shutting down a tunnel on weekends.
A shutdown of one of the existing tunnels would reduce train service and hurt “Democratic, Republican and Independent families,” he said.
While acknowledging and supporting the two lawsuits, Gottheimer said the litigation shouldn’t stop talks from happening for a legislative solution to free up funds.
“I’m taking an all of the above approach to get this solved,” Gottheimer said. “There are Republicans and Democrats working to get it moving.”
Both Sherrill and Gottheimer said stopping work on Gateway also wastes $1 billion of taxpayer money already spent on five projects, one of which is completed.
“We have members of the congressional delegation like Josh Gottheimer working hard at negotiating to get the money released,” she said. “We are using every means we have to fight hard for job for the economy and the commuter of the state.”
Construction has stopped on two concrete “launch pads” for the first tunnel boring machines to begin drilling through the Palisades in North Bergen in the spring, Sherrill said.
“This is why we’re fighting,” she said. “This is political decision by the president to cancel money that is already in a pot, ready to put to work.”
Gateway funds is being tied to congressional approval of full funding for Department of Homeland Security, something Democrats won’t support without restraints on the agency after the shooting by ICE officers of two protesters in Minneapolis.
White House spokesman Kush Desai said U.S. Sen. Chuck Schumer, D-N.Y., and Democrats were standing in the way of a deal for Gateway by refusing to negotiate with the Trump administration for full Department of Homeland Security funding in return for reinstating funding, according to Reuters.
Prior to that, funding was tied to a new federal rule regulating the award of contracts to Disadvantaged Business Enterprises on the bases of gender or race.
Gateway officials said it suspended all Disadvantaged Business Enterprises activities late last year to comply with the federal rule and get funding reinstated.
“You can’t have a first rate economy with second rate infrastructure,” Gottheimer said. “Gateway is not an optional project.”
