New York State and the MTA filed suit against the Trump administration Tuesday, demanding the release of nearly $60 million in frozen federal funding for the Second Avenue Subway extension into East Harlem, a project that would bring the Q train from 96th Street north to 125th Street.
The lawsuit, filed in the Federal Court of Claims, argues that the Department of Transportation breached a contract it had already signed with the MTA when it stopped reimbursing the agency for project costs. The funding freeze has been in place since October.
MTA Chair and CEO Janno Lieber announced the legal action while testifying at a City Council preliminary budget hearing Tuesday morning.
“The MTA has just filed a lawsuit against the federal government to restore funding for the Second Avenue Subway,” Lieber said. “Everybody knows the Trump administration has been withholding money for New York infrastructure projects. 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 suit asks the court to resolve the breach of contract claim on “an expedited motion for partial summary judgment,” arguing that the frozen $58,643,339.10 represents a clear-cut case that can be decided quickly. The filing also warns of cascading consequences if the funding is not restored promptly, saying the freeze could delay the agency’s ability to award the next contract for excavation of two new stations at 106th and 125th Streets. Beyond the immediate reimbursement, attorneys are also seeking “other consequential damages” caused by the suspension.
Trump’s DOT froze the funding in October, citing the need to review the MTA’s contracting with minority- and women-owned businesses for compliance with the administration’s new rules targeting diversity, equity, and inclusion programs. Lieber has said repeatedly that the MTA answered all of the federal agency’s questions about its contracting practices. The freeze continued anyway.
The stakes are significant for East Harlem and for the city’s broader transit future. The full extension project carries a price tag of $6.9 billion, with roughly $3.4 billion expected to come from federal sources. Losing that federal share, or watching it drain away through delays and inflated costs, would put the entire timeline at risk.
Gov. Kathy Hochul drew a direct line between Tuesday’s suit and two earlier legal actions filed by New York and New Jersey alongside the Gateway Development Commission, seeking to unfreeze federal funding for the Gateway Tunnel project connecting the two states. Those suits are ongoing, but one already produced results: a court ordered the restoration of $235 million in federal funding for the $16 billion Gateway project, giving New York officials a legal template to work from.
Lieber had signaled the lawsuit was coming. At the MTA’s board meeting last month, he threatened legal action if the administration did not release the funds. Tuesday’s filing made good on that threat.
The Second Avenue Subway extension has been a long time coming for East Harlem, a neighborhood that sits at the end of an unfinished line that was supposed to keep going decades ago. The current Phase 2 project represents the next concrete step toward completing what was promised to upper Manhattan residents long ago. Any delay hits a community that has been told for years that their stop is next.
For the city’s congressional delegation and Albany officials, the lawsuit fits into a broader pattern of fighting Washington over withheld infrastructure dollars. Federal transportation funding is not discretionary charity for New York. It flows from agreements the government signed, backed by federal law and contractual obligations the DOT now appears to be ignoring.
The court will decide whether those contracts mean what they say. If the Gateway litigation is any guide, New York has a reasonable shot at winning quickly. The MTA is asking for speed, and given what a prolonged freeze would cost East Harlem commuters and city taxpayers, the pressure to move fast is justified.
