By David Shepardson
Feb 9 (Reuters) - A U.S. judge in New York on Monday temporarily put her ruling on hold forcing the Trump administration to lift a four-month-old freeze on federal funding for the $16 billion Hudson River Tunnel Project connecting New York City and New Jersey.
U.S. District Judge Jeannette Vargas on Friday had ordered the funding be restored. The Justice Department had warned it would be required by 1 p.m. Monday (1800 GMT) to disburse up to $200 million in funds for the Gateway
Tunnel project unless her order halted.
Vargas said she would put her order on hold until Thursday at 5 p.m. to give the Second Circuit U.S. Court of Appeals time to consider the government's emergency request. But she denied the government's request for an extended halt, saying New York and New Jersey have demonstrated the shutdown of operations prompted by the funding freeze "will have an immediate and severe impact on the region’s economic interests."
The Justice Department argued it would not have an "obvious mechanism for recovering that money later if the government prevails on appeal."
USDOT, the White House and Gateway did not immediately comment.
The Gateway project will build a new commuter rail tunnel between Manhattan and New Jersey and repair a century-old tunnel used by more than 200,000 travelers and 425 trains daily.
The existing Hudson Tunnel was heavily damaged by Hurricane Sandy in 2012 and needs frequent emergency repairs that disrupt travel on the nation’s most heavily used passenger rail line.
The Gateway project halted construction Friday and has said it will resume when funding is restored.
The states said the Trump administration had frozen the funds in a “brazen act of political retribution” against their Democratic leaders.
The Trump administration has withheld $205 million in reimbursements for the project since October 1, Gateway said.
Trump has reportedly demanded that Washington Dulles Airport and New York's Penn Station be renamed for him in exchange for unfreezing the funds, drawing strong criticism from Democrats.
The project was allocated about $15 billion in federal support under former President Joe Biden. Nearly $2 billion has been spent on the project so far.
(Reporting by David Shepardson; editing by Diane Craft)
