President Donald Trump’s budget chief used Day 1 of the government shutdown to halt infrastructure funding to New York City.
Office of Management and Budget (OMB) Director Russ Vought announced on X on Wednesday morning that the administration was withholding some $18 billion from the country’s biggest and one of its bluest cities.
“Roughly $18 billion in New York City infrastructure projects have been put on hold to ensure funding is not flowing based on unconstitutional DEI principles,” he wrote, indicating there would be more to come from the Transportation Department.
He then specifically clarified that it would be funding for the Hudson Tunnel Project and the Second Avenue Subway.
The first project involves the construction of a new tunnel under the Hudson River, as well as the rehabilitation of railroad tracks in one of the country’s biggest economic hubs. The other project relates to ongoing construction to build the subway running through Manhattan.
It is not clear how tunnel projects conflict with the Trump administration’s crusade against diversity, equity and inclusion.
The Transportation Department said the withheld funds were a direct casualty of the government shutdown. It said it was reviewing New York’s “unconstitutional contracting process” and that reimbursements could not proceed until it was complete.
“Thanks to the Chuck Schumer and Hakeem Jefferies [sic] shutdown, however, USDOT’s review of New York’s unconstitutional practices will take more time,” it said in a statement.
However, the timing of his announcement to withhold funds comes as the government entered a shutdown after Senate Minority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries were unable to get Trump to agree to a deal. Both lawmakers represent New York.
Republican leaders early Wednesday indicated there would be no path forward to negotiate with Democrats demanding that the spending deal also address the looming health care cliff. They said Democrats needed to get on board with their bill and said they would keep bringing it up for a vote.
When asked whether it was appropriate to withhold funds from the state represented by Democratic leaders, Senate Majority Leader John Thune replied simply to vote to open the government.
It comes after OMB also threatened mass layoffs of federal employees should the government shut down, but Democrats fired back that they would not be intimidated.
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