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How a Trump power play upended the $30 billion Gateway project

From left, House Speaker Paul Ryan (R-Wis.), Irish Prime Minister Leo Varadkar, President Trump, Rep. Peter T. King (R-N.Y.) and Vice President Pence leave an event at the Capitol on March 15. (Aaron P. Bernstein/Reuters)

The deal was struck last week in an ornate room just off the House floor, where two New Yorkers discussed a big infrastructure project in their home town as dignitaries milled around a St. Patrick’s Day luncheon.

President Trump’s message to Rep. Peter T. King (R-N.Y.) was simple, King recounted Thursday: Federal money would flow to the $30 billion Gateway project, but Trump had to be in control.

In the end, that is largely what happened: After weeks of precarious negotiations, the $1.3 trillion spending bill the president eventually signed Friday doesn’t explicitly mention Gateway and reverses some earlier attempts to steer funding its way.

Trump’s puzzling intervention to seemingly derail the kind of megaproject that a self-styled master builder might be expected to champion was less about Gateway’s merits and more about who was backing it — specifically, Senate Minority Leader Charles E. Schumer (D-N.Y.), according to multiple lawmakers and congressional aides involved. His decision to prioritize a political blow to Schumer offers a fresh demonstration of how Trump dealt with his political rivals in the months leading up to his signing of the spending bill — hours after he delivered one last veto threat over its failure to deliver substantial border wall funding.

“I think he was upset by a lack of cooperation on other issues, and I think he wanted to show that you don’t take anything for granted,” said King, who kept details of his conversations with the president private until the House passed the bill Thursday.

Trump’s priority quickly became a Republican priority. At a Thursday news conference, House Speaker Paul D. Ryan (R-Wis.) counted handing the administration more control over Gateway among the GOP’s key wins in the sweeping spending bill. He detailed how he overruled efforts by his own Appropriations Committee chairman, Rep. Rodney Frelinghuysen (R-N.J.), to direct $900 million to the project.

“We stripped that language from this bill so that there’s more discretion for the administration,” Ryan said.

Whether it made a difference to the future of the project — a rail tunnel and bridge connecting New Jersey and Manhattan — is a matter of debate. Those who support the project, Republicans and Democrats, assert that it remains on track even after Trump’s intervention.

Schumer told reporters Thursday that the bill continues to offer a “reliable pathway” for Gateway through accounts controlled by Amtrak and the states, not by Trump. King, too, said that money would keep flowing to Gateway and that Trump would ultimately support the project.

“It doesn’t say Gateway. It’s not specific to Gateway. But the money is there,” King said.

Inside Trump’s decision to block a crucial New York-New Jersey tunnel project

But the final bill brings the funding more firmly under the administration’s control. Accounts that appropriators had proposed pumping up for Gateway shrunk in the final deal, and guidelines that would have given the project a leg up in administration funding decisions disappeared. Even project backers acknowledge that only $541 million will be easily accessible to the project this fiscal year, vs. the $900 million eyed last year.

David Van Slyke, dean of the Maxwell School of Citizenship and Public Affairs at Syracuse University and an expert on major infrastructure projects, said Trump’s opposition to Gateway — as a builder and as a New Yorker — is mystifying and potentially discourages investors in the sort of public-private projects his administration is advocating.

Transportation Secretary Elaine Chao on March 6 had tense exchanges with Democratic congressmen over the funding of the Gateway tunnel project. (Video: House Transportation Committee)

“When he gets involved in a project like this, it’s hard to understand . . . what is his preferred alternative?” he said. “What is the underlying set of goals? He’s for something until he appears to be against something.”

The deal struck this week followed more than a year of hardball politics — dating back to Schumer’s decision to vote against confirming Elaine Chao, who is married to Senate Majority Leader Mitch Connell (R-Ky.), as transportation secretary. Schumer later held up other Transportation Department nominees in part to advance Gateway, according to aides familiar with the dispute.

By September, Trump was well aware that Gateway was a top priority for Schumer. A bipartisan delegation that included Schumer, the governors of New York and New Jersey, and numerous lawmakers visited the Oval Office to garner the president’s support.

They left the meeting — where by all accounts Trump was at his charming, back-slapping best — confident that his administration would back the project as it started moving through the long pipeline for federal funding. And they had an ace in the hole: As House appropriations chairman, Frelinghuysen could steer dollars in its direction.

A spending bill that passed the House in September was accompanied by a report ordering the Transportation Department to give preference to grant applications addressing “major critical assets which have conditions that pose a substantial risk now or in the future to the reliability of train service.” Another provision reserved $400 million for new projects that only Gateway could qualify for.

But as the Oval Office meeting broke up, there was a signal that Trump saw a bargaining chip, not just a vital project: Trump pulled Schumer aside, according to a person familiar with the encounter, and offered to trade Gateway funding for his border wall.

That offer went nowhere. “I didn’t want to get involved in any trading,” Schumer said Thursday, speaking generally about his approach to Gateway.

Still, the project remained on Trump’s mind, and White House aides fueled his doubts, portraying Gateway as a politically motivated boondoggle that was sucking dollars away from other administration priorities.

“You put that much money into one project, it’s going to crimp projects across the country,” Marc Short, Trump’s legislative affairs chief, told reporters Tuesday.

Matters came to a head Feb. 28, when Trump came to the Capitol to welcome the casket of the late preacher Billy Graham. As he waited to enter the Rotunda, Trump cornered Ryan, raised the Gateway proposal and made clear he would veto any bill that funded it.

The next week, after The Washington Post reported Trump’s opposition, Chao appeared before the House Transportation and Infrastructure Committee and told lawmakers supporting Gateway that the September meeting might have been “cordial” but the president had doubts about the project. She dismissed a proposed funding scheme floated by New York and New Jersey, and tentatively endorsed by the Obama administration, that would have had state taxpayers and transit riders pick up half the project’s cost.

“They need to step up and bear their fair share,” she said.

[Fact Checker on Chao’s claim about New York and New Jersey]

The hearing infuriated Democrats who thought that the project remained on track after the Oval Office meeting and were blindsided by Trump’s opposition. Party leaders spent the next two weeks sparring in closed-door negotiating sessions, trying to salvage the project as GOP aides rejiggered the legislation to bring the funding under the administration’s control.

Rep. Sean Maloney (D-N.Y.), a member of the Transportation Committee, said Trump appeared intent on “screwing New York” — citing not only Gateway, but also the GOP tax bill and health-care plan.

“Look, we’re New Yorkers, I think we know better than to think anybody’s going to give you what you deserve by being nice,” he said. “They should do it because it’s important to America, and we shouldn’t have to tell them that.”

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