This audio is automatically generated. Please let us know if you have any comments.
Dive Brief:
- The Gateway Development Commission restarted work on the Hudson Tunnel project this week, but only on a limited basis, according to a U.S. Court of Federal Claims case filed Monday.
- Although the DOT already disbursed more than $205 millionnearly $19 million from a January refund request remains outstanding and is due March 2, according to the filing. The DOT has also declined to confirm that it will not seek to recover previously released funds if a temporary restraining order that reinstates the payments is upheld on appeal.
- That funding pushback has already delayed two major contracts in the $16 billion infrastructure project, including the Hudson River Tunnel Package, according to the filing. GDC said in its filings that the suspension of earlier work on the project resulted in “millions of dollars in additional costs, including additional safety at work sites during the shutdown.”
Diving knowledge:
The latest GDC presentation shows that the fight for funding and continued construction is far from over.
The administration of President Donald Trump initially suspended funding on September 30, 2025, to launch an administrative review of GDCs’ race- and sex-based hiring targets under the federal Disadvantaged Business Enterprise Program. The administration afterwards removed these criteria of the program.
The funding hiatus led to a breach-of-contract lawsuit by GDC in early February after more than $205 million went unpaid. A federal judge ordered DOT to resume funding earlier this month and GDC later received these overdue dollars .
But the DOT is now actively seeking to uphold the temporary restraining order that required the disbursements in the first place. It has also declined to confirm that it would not seek to recover funds if the order is overturned, according to the GDC filing.
The DOT press office did not immediately respond to a request for comment.
“Certainty of funding is exactly what GDC’s grant and loan agreements with DOT are designed to confer,” the GDC said in its filing. “As things stand, the DOT could try to recover the money it has paid under the [temporary restraining order] at any time, potentially forcing another costly work stoppage.”
This threat forced GDC to postpone the award of major construction contracts needed to maintain its established schedule. The agency also recently issued letters limiting the work of professional services contractors on the project, according to the filing.
Although federal funds flowed into GDC earlier this month, financial pressure is still on the horizon.
An additional $18.9 million reimbursement request for January costs is due next week, and February cost claims are due April 1, according to the filing. DOT has not guaranteed payment of these amounts if the restraining order is lifted.
“DOT has refused to confirm that it will pay that money if that is the case [temporary restraining order] is suspended, meaning GDC will soon have to amend its complaint to add a breach of contract claim for the March breach,” according to the filing. “Once again, GDC has no certainty as to whether these claims will be paid or whether DOT will default again, particularly given the government’s decision to continue to appeal this claim. [temporary restraining order] before the Second Circuit”.
