The MTA sued the Trump administration on Tuesday for withholding federal funding for the expansion of the Second Avenue subway into East Harlem.
The lawsuit, filed in the U.S. Federal Court of Claims, comes five months after the president’s budget director, Russell Vought, announced the White House would stop distributing a $3.4 billion grant for the project. Vought at the time wrote on social media the funding would not flow while the feds reviewed the MTA’s practices for issuing contracts to minority- and women-owned businesses.
MTA officials have since said they’ve complied with the review, but the funding was still not released. Now, the agency argues the U.S. Department of Transportation is in breach of contract.
The agency wrote in the lawsuit that it’s owed $60 million from the federal government, which “has required the MTA to divert millions of dollars away from other critical transportation projects in order to fill the gap.”
The Trump administration last fall also withheld grants and loans for the Hudson River tunnel project, known as Gateway. The attorneys general of New York and New Jersey sued the feds over the funding freeze for that project, and a Manhattan federal judge ordered the federal Department of Transportation to release the money.
“Once again, New York has been forced to sue the Trump administration to stop them from erratically shutting off billions of dollars in previously committed infrastructure funding,” Gov. Kathy Hochul wrote in a statement.
The MTA in its lawsuit wrote that the Trump administration froze funding for both the Second Avenue subway and Gateway tunnel projects “in order to put political pressure on Senate Minority Leader Chuck Schumer (D-NY) over the October 2025 government shutdown.
“Whatever the administration’s true motivations may be, there is no question that DOT is in breach,” the lawsuit states.
Work on the subway extension is well underway, with the MTA already working on utility relocations and purchasing properties that need to be moved for construction.
The project aims to build three new subway stations along the Q line, extending it from the Upper East Side into East Harlem, ending at 125th Street where the Q would connect with the 4, 5 and 6 trains. With an estimated $7.7 billion cost, it’s one of the most expensive subway expansion projects ever on a per-mile basis.
MTA officials have said they can’t award new contracts for tunneling until the funding from the feds has been secured. Hochul wrote in her statement that the funding freeze “has put the entire project at risk.”
MTA officials previously said they did not file a lawsuit because the agency had enough money to continue work.
The MTA in its lawsuit requested a judge immediately order the feds to restore the funding, warning the freeze risks “creating a ‘domino effect’ of cascading delays and inflated costs.”
U.S. Department of Transportation spokesperson Danna Almeida said the agency is “considering all legal avenues” following the lawsuit.
The department “is committed to ensuring hardworking taxpayer dollars are being spent responsibly,” Almeida wrote.
MTA Chair Janno Lieber pointed out during a City Council hearing on Tuesday that East Harlem has been promised a Second Avenue subway since the 1940s. New York officials have tried and failed to bring a new subway to the neighborhood since then.
“We don’t want that work to stop because of this funding gamesmanship that’s going on in Washington,” Lieber said. “We want to keep showing New Yorkers that this is in fact a new MTA.”
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