Federal judge blocks administration from withholding Gateway tunnel funds

A federal judge in Manhattan issued a permanent order Monday blocking the administration from withholding federal funds for the $16 billion Gateway tunnel project under the Hudson River. The 59-page ruling by U.S. District Judge Jeanette Vargas makes permanent a temporary restraining order she granted Feb. 6, the same day construction halted due to lack of money.

Background on the funding dispute The Transportation Department initially said it was withholding the money while reviewing whether the Gateway Development Commission complied with federal anti-discrimination laws in awarding contracts. Vargas noted the administration did not dispute that the suspension violated federal law and made no attempt to justify the action under governing regulations.

Statements from the administration and project backers The president told Fox Business Network host Maria Bartiromo on Oct. 17 that the project was being cut because of Senate Minority Leader Chuck Schumer's role in a government shutdown. New Jersey and New York officials said in a joint statement that the ruling allows construction to continue and sends a message that the funding freeze will not stand.

A Transportation Department spokesperson said the department remains committed to ensuring taxpayer dollars are spent responsibly and do not fund discriminatory contracting practices. The commission is pursuing separate litigation against the department for monetary damages over the suspension.