How Not to Build Infrastructure Projects
Amtrak engineers regularly venture deep under the Hudson River to eyeball the ancient rail tunnel between New York and New Jersey. Shutting down the Superstorm Sandy–scarred, 116-year-old structure can’t be completely ruled out before its replacement is online—and it’s not out of the question that running trains could be too risky one day. Should that happen, some 200,000 people who pass through the tunnel each day will have to find some other way in, out, or around New York City, a titanic enough challenge on an ordinary day.
The long-running fight to build a new rail tunnel only ended in 2023 when construction finally began. The tunnel is part of Gateway’s first phase, which includes the nearly completed Portal North Bridge. Two years later, the Gateway Program’s Hudson Tunnel Project, one of the largest megaprojects in the United States, has become a multibillion-dollar bargaining chip for the Trump administration.
The administration had previously stalled the project by refusing to release legally obligated funding. Late in the afternoon last Friday, the Department of Transportation finally released $30 million of the $205 million that the Gateway Development Commission, the project overseer, needs to restart construction work. Federal officials released another $77 million on Tuesday.
The Gateway fiasco is the latest installment in the Republican Party’s mission to sidetrack badly needed infrastructure projects in a country with C-grade infrastructure. Continued interruptions to the $16 billion Hudson Tunnel Project, connecting the New York metropolitan area rail links as well as the northern and southern portions of Amtrak’s Northeast Corridor rail service, would be another major self-inflicted disruption to the American economy.
About 1,000 construction workers could go back to work as early as next week. However, the Trump administration’s move-fast-and-break-things imperative compromised what progress had been made by provoking lawsuits, increasing worker anxiety, and creating supply chain choke points.
Partisan power plays have completely compromised projects of national significance.
“I view the action by the White House as being offensive, using workers as political pawns for political gain,” Michael Hellstrom, vice president of the Laborers’ International Union of North America (LIUNA), told me last Friday, referring to the ongoing feud between President Trump and Senate Minority Leader Chuck Schumer. “These things typically don’t happen on public works,” he says. “They may happen on private development projects,” but “when public work starts it’s usually gold work, guaranteed work.”
Hellstrom pointed out that work stoppages affect worker availability. Tunnel workers are hard to come by, he says, explaining that working underground hundreds of feet under a river in confined space requires certain skills. “When they become available, you want to put them to work and keep them working, or they’ll go find other tunnel projects,” he adds. “That’s a risk that the contractors are facing here … it’s definitely a kick in the teeth.”
The delay also signals that any other project could come under fire, says Hellstrom: “We’re starting to hear rumblings of other projects throughout the country that they’re taking hostage [like] the bridge out of Canada coming into Michigan.”
The project’s domestic supply chains are ensnared in this chaos: Tunnel boring components manufactured in Ohio are beginning to arrive; since they are purpose-built, they can’t be shunted to another project at some other construction site, which will almost certainly have different specifications.
The Rail Passengers Association has reported that multiple states involved in Gateway could see impacts, including Alabama and Colorado (geotechnical monitoring equipment and industrial materials); Pennsylvania (steel and fabricated assemblies); North Carolina and Tennessee (specialized electrical systems and industrial components); and Texas (engineering and program management service). MPA Delivery Partners, a joint venture coordinating the project, has noted that the tunnel project is “driving demand for U.S. suppliers of steel, aggregates, rail and track, and ventilation systems.”
Hellstrom admitted that his members feel like they’ve been “bamboozled.” “This is definitely not making America great in their eyes,” he says. “The facts are clear: One person is responsible for the shutdown of this project and that’s the president of the United States. Our aggravation is directed toward this White House and that’s only going to grow.”
Partisan power plays have completely compromised projects of national significance—those crucial big-budget, multiyear undertakings that span administrations. Trump isn’t the first Republican to jam up the rail tunnel replacement. Former New Jersey Gov. Chris Christie tossed out Access to the Region’s Core, a mid-2010s tunnel proposal that would have been completed by now. During that period, Republican governors in Florida, Ohio, and Wisconsin also nixed rail projects and returned federal grant monies to Washington.
The twist here is that the Trump administration has decided to claw back funds already appropriated by Congress. The president has embarked on what a New Jersey and New York lawsuit called “a brazen act of political retribution,” featuring a “deal” offering to release funds if Trump got his name on Penn Station in New York and Washington Dulles International Airport in Northern Virginia. Last week, Trump blamed that idea on Schumer (who called the claim “an absolute lie”). This week, the president blamed it on unnamed politicians and labor leaders.
Last year, New Jersey Gov. Mikie Sherill ran on a “Save Gateway” platform, which helped her blast Jack Ciattarelli, the Republican nominee, out of the water. Trump’s claim that the project is headed for cost overruns that he says the federal government won’t pay for (but which the Transportation Department has contributed to by holding up its funding) has set in motion disputes that could push well into peak campaign season.
Holding up the Hudson Tunnel Project won’t help Republicans in the Northeast. In New York, Gov. Kathy Hochul, one of Gateway’s staunchest backers, is up for re-election and, like Sherrill in New Jersey, can add that to her campaign arsenal. Some GOP members of Congress could run into problems in their districts. More construction stoppages, or deteriorating tunnel conditions, or both, will only energize legions of angry commuters and construction workers. The president, like Chris Christie before him, now owns the rail tunnel project.
The struggle to keep the Hudson Tunnel Project construction on course for its scheduled completion by the mid-2030s entered its latest round in early February when the Second Circuit Court of Appeals declined to overrule a lower-court decision: On February 6, a federal district court judge had ordered the Department of Transportation to release the funds that the administration has held up since last October.
In the intervening months, the GDC had relied on a letter of credit and its own reserve funds to keep the project going during federal “review” of an “unconstitutional” Disadvantaged Business Enterprise (DBE) Program supporting small minority-, women-, and veteran-owned firms. With its own funding backstops running out and no money coming from Washington even after the judge’s ruling, the GDC paused construction.
“This is a straightforward breach of contract case,” GDC argued in its February 3 lawsuit against the federal government. The Transportation Department appealed to the Second Circuit shortly afterward. New York and New Jersey also filed suit against the department and other federal officials in a second case.
The Hudson Tunnel Project backstops 95,000 full-time jobs and more than $19 billion in economic activity, not to mention the tremendous economic carnage that would be unleashed if this vital economic artery were cut. Two billion dollars has already been spent, and every day of work stoppages wastes millions more taxpayer dollars. The instability in Washington means that Republican and Democratic state leaders building major projects with federal dollars will have to assume that they could end up in the same straits as New Jersey and New York.
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