White House pauses $18B in NY rail projects for DEI review

The White House on Wednesday directed a pause on roughly $18 billion in federal funding for two major New York City infrastructure projects, the Hudson Tunnel Project and the Second Avenue Subway, hours after the federal government entered a shutdown. The Office of Management and Budget said the hold was intended to allow an administrative review into whether contracts for the projects involve diversity, equity and inclusion practices that violate constitutional or civil rights standards.

Budget Director Russell Vought announced the action on the social media platform X, saying the pause would ensure money was not flowing based on unconstitutional DEI principles. The Department of Transportation subsequently said the agency’s civil rights staff responsible for reviewing such contracts have been furloughed because of the shutdown, and that reimbursements cannot be processed until USDOT’s review is complete.

Both projects are large recipients of federal capital. The Gateway Hudson Tunnel initiative, intended to add a new rail tunnel under the Hudson River linking New Jersey and New York, received billions in federal commitments in recent years. The Second Avenue Subway’s second...