Trump administration halts $18B in NYC transit work and nixes $8B in green projects
The White House this week moved to pause roughly $18 billion in New York City transportation work and to cancel about $8 billion in energy grants, actions aimed squarely at Democratic-led agendas during the shutdown. The decisions are being framed in Washington as a fiscal and constitutional check on what the administration calls politically driven spending. Expect loud back-and-forth from governors and congressional Democrats who see jobs at stake and politics in motion.
The Office of Management and Budget highlighted the green energy cuts with a pointed line aimed at climate initiatives. “Nearly $8 billion in Green New Scam funding to fuel the Left’s climate agenda is being cancelled,” Office of Management and Budget Director Russ Vought on Wednesday. The administration says taxpayer value, not ideology, is guiding the Department of Energy review.
Meanwhile the Department of Energy announced a major termination of awards tied to earlier grant rounds and loan programs. The agency said it ended dozens of financial awards after a review, noting termination of “321 financial awards supporting 223 projects, resulting in a savings of approximately $7.56 billion dollars for American taxpayers.”
The DOE defended its move by pointing to rigorous financial screens and return-on-investment concerns. “Following a thorough, individualized financial review, DOE determined that these projects did not adequately advance the nation’s energy needs, were not economically viable, and would not provide a positive return on investment of taxpayer dollars.” Recipients have a short window to appeal, and some already are contesting the terminations.
California officials reacted sharply after the White House action hit a major hydrogen project the governor had touted. “In Trump’s America, energy policy is set by the highest bidder, economics and common sense be damned,” Newsom said, promising to keep pursuing a “clean energy strategy… no matter what DC tries to dictate.” The state warned of lost jobs and investment if key projects lose federal support.
Nearly $8 billion in Green New Scam funding to fuel the Left’s climate agenda is being cancelled. More info to come from @ENERGY.
The projects are in the following states: CA, CO, CT, DE, HI, IL, MD, MA, MN, NH, NJ, NM, NY, OR, VT, WA
— Russ Vought (@russvought) October 1, 2025
On infrastructure, the administration said it paused a slate of New York City projects to examine whether funding flowed based on race- or sex-based contracting rules. Vought also on Wednesday, “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. More info to come soon from @USDOT.” The USDOT signaled a targeted review of procurement practices tied to diversity, equity, and inclusion policies.
The hold list, according to the administration, includes headline projects that symbolize New York’s long-term rebuild efforts. “Specifically, the Hudson Tunnel Project and the Second Ave Subway.” Those two alone are central to commuter capacity and regional rail resilience, and the pause has immediate ripple effects for contractors and local planning.
USDOT officials argued the review is about constitutional limits on using federal taxpayer dollars to enforce race- or sex-based contracting preferences. The department warned that subsidizing projects with “race- and sex-based contracting requirements… is unconstitutional, counter to civil rights laws, and a waste of taxpayer resources.” The review is billed as administrative and time-limited, though the shutdown has complicated staffing.
The administration also made clear the pause is temporary while a quick administrative review is performed, but timing is now uncertain. “Thanks to the Chuck Schumer and Hakeem Jeffries shutdown, however, USDOT’s review of New York’s unconstitutional practices will take more time,” the statement said, noting a furlough of civil rights staff slows the process. That line has become a political stick for both sides in the funding fight.
Democratic leaders reacted with blunt criticism, calling the moves political and destructive. Senate Minority Leader Chuck Schumer of New York on Wednesday regarding the pause on the projects, “Obstructing these projects is stupid and counterproductive because they create tens of thousands of great jobs and are essential for a strong regional and national economy.” New York’s governor called the actions payback against the state.
New York Governor Kathy Hochul said halting funding for “critical infrastructure projects” looked like a retaliatory play and warned of harm to residents. “Donald Trump has been clear: he is intent on using his reckless government shutdown to hurt the American people,” Hochul said. Local officials are already scrambling to assess contracts and timelines if federal money is delayed.
Across the board, the administration frames the decisions as fiscal discipline and a defense of constitutional norms in contracting, not an attack on local projects per se. The moves signal a broader willingness to use budget and administrative levers to reshape how federal dollars flow to states and private partners. That posture will drive more court fights and political theater in the weeks ahead.
At the center of the debate is a larger question about who sets priorities: federal officials guided by constitutional and budget concerns or state and local leaders driving ambitious infrastructure and green transition plans. The White House is betting voters will back cuts framed as taxpayer protection, while opponents will focus on near-term job losses and stalled projects. Either way, expect litigation, appeals from affected recipients, and a long argument about American federalism and energy policy.
The administration’s move also revives familiar tensions about federal spending conditionality, especially where DEI and climate initiatives intersect with procurement and grant rules. Supporters of the cuts say it’s overdue correction after years of unchecked priorities; opponents see it as weaponization of funding to score partisan points. The policy fights promised here are likely to outlast the headlines and shape how major projects are funded for years to come.
