NEW YORK – In a significant development for New York City’s transit infrastructure, the Trump administration has decided to reinstate funding for a crucial subway project in Manhattan after legal action was initiated by state officials.

The U.S. Department of Transportation announced in a federal court filing on Thursday that it has concluded its assessment of the Second Avenue subway line project. As a result, the department will resume reimbursing New York state transit authorities for their construction expenses.

Janno Lieber, CEO of the Metropolitan Transportation Authority (MTA), expressed that this decision marks the beginning of “long-awaited transit justice” for communities in upper Manhattan. The Second Avenue subway project aims to extend subway service northward along the Upper East Side, providing enhanced transit access to areas including parts of Harlem.

Lieber commented, “It shouldn’t have required seven months and a lawsuit to reach this point,” underlining the delays and challenges faced in securing the funding.

The Department of Transportation emphasized that the agreement ensures that taxpayer money will not support what it described as unconstitutional diversity, equity, and inclusion (DEI) initiatives. The administration has argued that the incorporation of DEI principles has led to increased costs on federal projects and is unconstitutional.

“Our focus has always been on securing the best deal for the American taxpayer and guaranteeing their funds are used effectively and equitably,” stated the agency.

Spokespersons for the MTA didn’t immediately respond to USDOT’s claims, but during a federal court hearing in Washington on Thursday, the state agency argued that it was already in compliance with federal policies and that the funding should have never been withheld, The New York Times reported.

The USDOT had withheld roughly $60 million from the Second Avenue project as it launched its review. Overall, the project is supposed to cost $7.7 billion, with the federal government covering around $3.4 billion.

The dispute over the Second Avenue subway was among a number of major transportation projects in New York and New Jersey that Trump has sought to scuttle as he feuded with Democratic leaders in those states.

The administration in October also halted billions of dollars in funding for a massive new rail tunnel between New York and New Jersey. A federal judge in February, however, ordered federal officials to resume payments for the tunnel project under the Hudson River.

Last year, the USDOT rescinded approval for New York’s first-in-the-nation congestion fee and threatened to pull funding from the state if it did not abandon the toll, which is imposed on drivers entering the busiest part of Manhattan.

But a federal judge ruled last month that the agency lacked the authority to unilaterally rescind approval of the $9 fee.