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The basics:

• Federal shutdown persists with $16B Hudson Tunnel Project funding on hold
• Pause becomes a flashpoint in Sherrill-Ciattarelli gov race
• USDOT cites contracting review
• Gateway Commission says project stays on budget and schedule

The federal government shutdown continues. As does the pause of funding for the Hudson Tunnel Project — and the war of words between the two sides of the political aisle.

As NJBIZ reported, a major front in the funding fight is the pause of funding for the nation’s largest infrastructure project. OMB Director Russ Vought announced the move this week in the early hours of the first federal shutdown since 2018.

That situation spilled onto the gubernatorial trail in New Jersey, as the race between Democrat Mikie Sherrill and Republican Jack Ciattarelli continues.

“The Trump administration is now attacking the Gateway Tunnel,” Sherrill wrote on social media. “@Jack4NJ said there’s not a single issue where he disagrees with Trump, and he promised to never take them to court. As governor, I will fight this tooth-and-nail and sue the Trump administration to finish this critical, job-creating infrastructure project to reduce congestion and improve quality of life in New Jersey.”

Ciattarelli responded on social media, “Shutdown fact: @MikieSherrill is an absentee Congresswoman who missed 90% of votes this year & refuses to work w/ GOP on anything. She voted against a bipartisan plan to keep the govt open & fund Gateway. Want to make Trenton even worse? Put a DC politician like Mikie in charge.”

During a campaign event after the U.S. Department of Transportation announced that funding freeze, Ciattarelli told NJ.com reporter Brent Johnson, “It doesn’t stop what’s going on today with regard to the construction. And I think it’s a large negotiation that’s taking place.”

Above politics

Meanwhile, Gov. Phil Murphy said, “During his first term in office, I was proud to work with President Trump to advance the Gateway Program – specifically the construction of the Portal North Bridge – to upgrade our region’s century-old transportation system. With millions of commuters depending on the Hudson Tunnel Project and tens of thousands of jobs on the line, I’m confident that we’ll be able to work with the Trump Administration to keep Gateway moving forward. A project of this importance should be above politics.”

In a statement about the broader shutdown, Assembly Speaker Craig Coughlin, D-19th District, said, “To make matters worse, the Administration has compounded the damage we are facing by suspending billions in financing for the Gateway Project, putting at risk the most important infrastructure project in the nation, and threatening the Northeast Corridor.”

And members of the New Jersey congressional delegation put out a joint Oct. 1 statement. The co-signers, include U.S. Sens. Andy Kim and Cory Booker, both Democrats; as well as U.S. Reps.:

• Frank Pallone, D-6th District
• Sherrill, D-11th District
• Bonnie Watson Coleman, D-12th District
• Nellie Pou, D-9th District
• Rob Menendez, D-8th District
• Herb Conaway, D-3rd District
• LaMonica McIver, D-10th District
• Donald Norcross, D-1st District

‘A direct attack’

“Today’s announcement by the U.S. Department of Transportation to halt the Hudson Tunnel Project is a direct attack on every New Jerseyan who relies on public transportation to get to work, take their kids to school, or operate their business,” the statement said.

“The progress we’ve made in securing funding for this project comes after years of listening to and working with New Jerseyans on both sides of the aisle and enacting policies that invigorate our state and regional economies and ensures New Jersey remains a place where families of all backgrounds can thrive.”

Democrats in the state congressional delegation also sent a letter to the Trump administration. The correspondence highlights the economic impacts of the project. It also draws attention to its success meeting major milestones – on time and on budget.

In its rationale, the USDOT pointed to potential “discriminatory principles.”

Vought alleges potential Diversity, Equity, and Inclusion (DEI) practices in contracting for the project for the pause. The rationale was widely seen as a way to increase pressure on Democrats. In particular, New York lawmakers and leaders in the center of the funding fight: Senate Minority Leader Chuck Schumer, D-N.Y., and House Minority Leader Hakeem Jeffries, D-N.Y.-8th District.

Pointing fingers

“USDOT issued letters to New York to inform them that their two mega projects – the 2nd Avenue Subway and Hudson Tunnel – are under administrative review to determine whether any unconstitutional practices are occurring,” USDOT wrote in a statement. “Until USDOT’s quick administrative review is complete, project reimbursements cannot be processed, including a $300 million disbursement for the 2nd Avenue Subway. The remaining federal funding for these projects totals nearly $18 billion.

“Thanks to the Chuck Schumer and Hakeem Jeffries shutdown, however, USDOT’s review of New York’s unconstitutional practices will take more time. Without a budget, the Department has been forced to furlough the civil rights staff responsible for conducting this review.

“This is another unfortunate casualty of radical Democrats’ reckless decision to hold the federal government hostage to give illegal immigrants benefits.”

No laughing matter

U.S. Rep. Josh Gottheimer, D-5th District, said, “This has to be a joke. Donald Trump’s attack on the Gateway Train Tunnel is not only an assault on mass transit, but it’s also an attack on the economy, labor, and American competitiveness. If Trump wants America to win and to create jobs, he will immediately unfreeze the funding I helped negotiate and secure for the Gateway Train Tunnel in the Bipartisan Infrastructure Bill.

“Enough chaos — time for a little common sense.”

Donald Trump’s attack on the Gateway Train Tunnel is not only an assault on mass transit, but it’s also an attack on the economy, labor, and American competitiveness.
— U.S. Rep. Josh Gottheimer, D-5th District

In response to the action, the Gateway Development Commission, which oversees the $16 billion Hudson Tunnel Project, said the following:

“GDC has received notification from FTA [Federal Transit Administration] regarding a pause in disbursements for the Hudson Tunnel Project. GDC complies with all federal laws and regulations, and will continue to do so throughout the project. We look forward to continuing our productive relationship with the Administration, FTA, FRA [Federal Railroad Administration], and the US Department of Transportation.

“In the meantime, we remain focused on keeping the project on scope, schedule, and budget.”

Please stay with NJBIZ for the very latest on this developing story.