Digging Starts for New $16 Billion Train Tunnel Project Under Hudson River

Elected officials in helmets and yellow jackets gathered in New Jersey on Monday for the ceremonial launch of a massive boring machine that in days will begin drilling through the solid rock of the Palisades Cliffs in New Jersey, the initial phase of the Hudson Tunnel Project from New Jersey to New York Penn Station.

The new tunnel is just one part of a massive infrastructure project designed to ease the congestion of trains traveling in and out of New York City. The existing tunnel was built in 1910.

The project will add two tunnels under the Hudson River for Amtrak and NJ Transit trains, which transport hundreds of thousands of commuters daily between New York and New Jersey. Its estimated cost is $16 billion, and completion is projected for 2035.

Under President Joe Biden, the Department of Transportation authorized $11 billion in grants and financing for the Hudson Tunnel portion of the project.

In October 2025, White House Office of Management and Budget Director Russell Vought announced it was freezing federal funding for the project over “unconstitutional DEI principles.” New York and New Jersey sued the federal government, which was forced to reinstate funding on June 29 after U.S. District Judge Jeannette Vargas ruled Vought’s move unlawful. The federal government initially appealed, but on Sept. 17 the Department of Transportation dropped the appeal.

“Did they try to stop us in two thousand different ways? Did they try to put a log in our path, whether it was from Washington, New York, New Jersey, did we say … we are building this tunnel?” said Sen. Chuck Schumer, speaking in North Bergen, New Jersey, at the drilling launch.

The Hudson Tunnel Project is part of the Northeast corridor modernization being implemented by the bi-state Gateway Development Commission. It is just one of 10 projects intended to upgrade the rail lines from Newark, New Jersey, to New York Penn Station.

The Vargas ruling allowed the Hudson Tunnel Project to move to the next phase: Two boring machines will begin drilling through one mile of hard rock under the Palisades Cliffs in New Jersey. The first phase is expected to be completed within one year, then the next phase of drilling under the river will begin.

A main part of the Hudson Tunnel Project is revamping the North River Tunnel.

The existing two-track North River Tunnel serving Amtrak and NJ Transit is one of the main reasons for delays in and out of Penn Station for hundreds of thousands of daily passengers.

The North River Tunnel will be updated so that once complete there will be four rail lines in and out of Penn Station.