$18bn New York infrastructure spend put on hold
02 October 2025
The US Department of Transportation (USDOT) has frozen nearly US$18 billion in federal funding for two major New York infrastructure projects while it reviews whether the state’s contracting practices comply with constitutional requirements.
Photo: Jason Yoder via AdobeStock
Russ Vought, director of the United States Office of Management and Budget, said on social media platform X that the projects under review are the Second Avenue Subway and the Hudson Tunnel.
USDOT said reimbursements, including a $300 million payment for the subway, will remain on hold until the review is completed.
According to Reuters, the agency sent letters to New York transit leaders on Tuesday stating that both projects would now need to be reviewed to “ensure nondiscrimination.”
The pause follows a new department rule barring race- and sex-based requirements in federally funded contracts. The review will determine whether such provisions are present in New York’s contracting processes.
USDOT described the two projects as among the largest infrastructure initiatives in the Western Hemisphere and said the review would be conducted “quickly” to avoid construction delays.
However, it noted that furloughs of civil rights staff during the ongoing government shutdown could slow the review.
The shutdown, which came into effect on Wednesday after Republicans and Democrats failed to reach a federal spending agreement, has temporarily affected staffing across federal agencies, including those responsible for overseeing infrastructure funding.
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