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10/3/2025
Editor's note: This story has been updated to include news of the USDOT's suspension of federal funding for two Chicago Transit Authority projects.
The U.S. Department of Transportation this week suspended billions of dollars in federal grants and loans for two New York area infrastructure projects and two major transit-rail projects in Chicago.
The department said it is putting federal funding of the projects on hold while it reviews whether they involve any race- or sex-based contracts that would be in violation of Trump administration policy and civil rights laws, USDOT officials said in a press releases.
In New York, the projects involved are the Hudson Tunnel and the second phase of the Metropolitan Transportation Authority's Second Avenue Subway.
"Until USDOT’s quick administrative review is complete, project reimbursements cannot be processed, including a $300 million disbursement for the Second Avenue Subway. The remaining federal funding for these projects totals nearly $18 billion," USDOT officials said.
However, the review can't be completed until after Congress approves a federal government funding bill, according to the department. USDOT suspended the projects' funding on Oct. 1, the same day that a federal government shutdown began due to the lack of a bill. The Trump administration blames Democrats for the shutdown.
"Thanks to the Chuck Schumer and Hakeem Jeffries shutdown, however, USDOT’s review of New York’s unconstitutional practices will take more time," the USDOT statement continued. "Without a budget, the department has been forced to furlough the civil rights staff responsible for conducting this review."
U.S. Sen. Schumer (D-N.Y.) is the Senate minority leader and U.S. Rep. Jeffries (D-N.Y.) is the House minority leader.
"Choking off these projects out of spite will damage America’s competitiveness and cost working families dearly," Schumer and Jeffries said in a joint statement.
They and other Democratic Party leaders say the federal government shutdown is primarily due to the Republicans' and Trump administration's refusal to negotiate over certain health-care benefits for Americans.
Hudson Tunnel and Second Avenue Subway are two of the largest infrastructure projects underway in the United States. The $16 billion Hudson Tunnel effort calls for constructing two new rail tubes and restoring the over-century-old rail tunnel under the Hudson River. The tunnels are used by Amtrak and New Jersey Transit trains to transport commuters between New York and New Jersey.
The Second Avenue Subway Phase Two project calls for extending the Q line into East Harlem and Harlem. The second phase is designed to improve and reduce commute time for area residents by creating two new stations on Second Avenue at 106 and 116 streets, as well as extending Q service to a third new station at 125 Street and Lexington Avenue that will connect to the 4/5/6 and Metro-North Railroad.
Meanwhile, today USDOT announced that it sent letters informing the Chicago Transit Authority that two projects — the CTA Red Line Extension and the CTA Red and Purple Modernization Program – are under administrative review to determine whether any "unconstitutional practices" are occurring. The remaining federal funding for both projects total $2.1 billion.