By: Emily Nixon
The Metropolitan Transportation Authority (MTA) sued the U.S. Government for breach of contract when the government failed to distribute previously allocated funds for one of two development projects. The Second Avenue Subway Project has been progressing with its second phase, which intends to expand subway service from 96 St. to 125 St., but that work has not been paid for, according to MTA Chair and CEO Janno Liber.
“When we put the paper in and make requisitions, and they’ve refused to do it, and then, when we kept putting the paper in through the online portal, they shut down the online portal, so we’re just going in what they call the federal court of claims, because it’s an action on a contract, to get them to release the money and let [the project] keep going,” said Liber in a New York City Council Budget Meeting on March 17.
Last October, the Director of the Office of Management and Budget (OMB), Russ Vought, announced on X that the Department of Transportation would freeze the funding designated for the Second Avenue pending a review “to ensure funding is not flowing based on unconstitutional DEI principles,” as previously reported by The Vanguard.
The government had no standing to revoke or freeze the funding, according to Liber.
“We were in no way violating any terms of the agreement. The Grant Agreement between the federal government and us obligates them to reimburse us,” said Liber in the March 17 meeting. “We intend to get every cent of what has been promised, and frankly, based on the agreements, what’s owed to New Yorkers — and we’re not afraid to fight for it in court.”
The Second Avenue Subway Project has been in the works for decades, and the MTA and New York Governor Kathy Hochul have doubled down their support to finally finish the project.
“Second Avenue Subway is an incredibly worthy project, long overdue transit justice for East Harlem, promised since the 1940s. Phase two is well underway, and it’s on budget, and it’s on schedule,” said Liber at the meeting. “We don’t want that work to stop because of this funding gamesmanship that’s going on in Washington.”
“For nearly a century, leaders have made big promises to the people of East Harlem about the expansion of the Second Avenue Subway,” said Hochul in a statement. “For nearly a century, those promises have been broken. When I took office, I pledged to be the Governor who kept her promise to this neighborhood and finally got this subway built.”
According to Liber, more contracts are needed to continue the project’s progress, but the lack of promised federal financial support has become a major concern, prompting the lawsuit.
“We’re on the verge of awarding a roughly billion-dollar contract for excavation on Second Avenue, and we need to know the federal money is available, and that’s why we’ve had to take this action.”
The decision to withhold the funding has yet to affect the project’s timeline or the employees working on it, but the conflict has become a point of frustration for leaders like Hochul.
“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,” said Hochul in a statement. “We have already made enormous progress — work is underway, and the project is moving on schedule and on budget. But Donald Trump’s unlawful funding pause has put this entire project at risk.”
The Hudson River Tunnel Project – also known as the Gateway Project– successfully sued the U.S. Government when its funding was withheld for the same rationale as the Second Avenue Subway Project on Feb. 18, according to New York State Attorney General Letitia James.
“This funding freeze was unlawful from the start. We took swift action in court, and now every dollar that was illegally withheld has been released. This morning, New York and New Jersey received the remaining nearly $130 million owed for the Gateway Project, finally unlocking all the funding that had been frozen,” said James in a statement.
The swift resolution for the Gateway Project has given MTA officials hope that the interruption of financial support will be short-lived, according to Liber.
Hochul has been a critic of the Trump Administration’s decisions, but feels the funding freeze will inevitably be lifted.
“His actions alone have jeopardized the commutes of over 100,000 New Yorkers and the jobs of thousands of union workers, but New York will not back down,” said Hochul in a statement. “Just like Gateway, Donald Trump has two options: restore the money now, or wait for a judge to force him to.”