The restoration resolves one of several funding disputes the Trump administration has pursued against New York and New Jersey transportation projects, though courts have also blocked the administration in related cases involving a Hudson River rail tunnel and the city’s congestion pricing program.
The U.S. Department of Transportation said in a federal court filing Thursday that it has completed its review of the Second Avenue subway project and will resume reimbursing New York transit officials for construction costs, ending a seven-month funding freeze that state officials had challenged in court.
The $7.7 billion project is building new stations northward along Manhattan’s Upper East Side, bringing subway service to parts of the Harlem neighborhood. The federal government is covering approximately $3.4 billion of the total cost.
Janno Lieber, the Metropolitan Transportation Authority’s chief executive, said the reversal meant “long-awaited transit justice” for neighborhoods in upper Manhattan. “It shouldn’t have taken seven months and a lawsuit to get here,” he said in a statement.
The Transportation Department described the resolution in different terms. The agency said the agreement ensures taxpayers’ “hard-earned dollars will not fund unconstitutional DEI initiatives,” referring to diversity, equity, and inclusion principles the administration has characterized as unconstitutional in federal projects. “This has always been about securing the best deal for the American taxpayer and ensuring their dollars are spent efficiently and fairly,” the department said.
Speaking with reporters Thursday, Lieber called the dispute “an unnecessary waste of the public’s time and money,” saying the MTA had been complying with the administration’s new rules on minority and women-owned business participation in federal projects when the freeze was imposed. “The whole point was they sent us a letter saying we didn’t make the standards of the new rules before they even issued the new rules,” he said. “It was just a bunch of gamesmanship.”
The federal government had withheld roughly $60 million from the Second Avenue project during its review.
The dispute was one of several the Trump administration has pursued against major transportation projects in New York and New Jersey. In October, the administration halted billions of dollars in funding for a new rail tunnel planned under the Hudson River between the two states; a federal judge in February ordered the government to resume payments on that project.
The administration had also sought to cancel New York’s congestion pricing program, which imposes a $9 toll on drivers entering the busiest part of Manhattan. A federal judge ruled last month that the Transportation Department lacked the authority to unilaterally rescind approval of the fee.