Appeals Court Clears Temporary Release of Gateway Tunnel Funds After Federal Freeze

A Second Circuit referral puts a two‑week, roughly $200 million reimbursement in motion pending further appellate review.

Overview

The Second Circuit declined to overrule a Feb. 6 order by Judge Jeannette Vargas, allowing it to take effect and compelling the federal government to release more than $200 million.
Project leaders said they expect about $205 million in reimbursements, with construction able to resume once the money reaches the Gateway Development Commission.
Work halted on Feb. 6 after the GDC exhausted short‑term credit; officials cited 1,000 immediate job losses and mounting costs to secure idle sites.
USDOT suspended disbursements in late 2025 for a Disadvantaged Business Enterprise compliance review, while federal filings argued forced payments now would be irreparable if the government later prevails and questioned the states’ standing.
The TRO is limited and temporary, with a motions panel not expected until the week of Feb. 23 and additional requests pending on whether to extend or alter the funding order into March.