The New Jersey Department of Transportation is accepting applications for $25 million in Fiscal Year 2027 grants to improve the state's freight rail system, with a submission deadline of Oct. 9, 2026.

The funding comes through NJDOT's Rail Freight Assistance Program, which the department said provides $25 million annually to preserve and improve New Jersey's existing freight transportation system and expand the availability of freight rail service to businesses across the state. NJDOT frames the program's capital investments as supporting its clean energy, congestion mitigation and sustainable development goals.

The money is not new to the state's rail network. Over the past five years, NJDOT has invested more than $139.32 million in freight rail improvements using Transportation Trust Fund money. Railroad owners and operators contributed an additional $17.04 million over the same period, bringing total investment through the program to nearly $156.4 million.

NJDOT's Division of Local Aid administers the program, which funds capital improvements intended to maintain economically viable freight rail service in New Jersey. Awards follow a competitive process with stated priorities: projects that improve connections to port commerce, eliminate missing freight rail links to New Jersey port facilities, and upgrade track to a 286,000-pound railcar load-carrying capacity. The 286,000-pound standard matches the North American industry benchmark for modern freight cars, meaning upgraded lines can handle today's standard loaded car weights rather than forcing lighter loadings or diversion to trucks.

The grants can cover up to 90% of a project's estimated cost. The sponsoring railroad is responsible for the remaining share, a structure that has produced the $17.04 million in private matching contributions recorded over the past five years.

Eligibility is limited to owners and operators of short-line railroads in New Jersey that have an existing use and maintenance arrangement with the owner. Before submitting an application, an applicant must have an Eligibility Assessment Form approved through the state's System for Administering Grants Electronically, or SAGE — the same portal through which proposals must be submitted. NJDOT caps participation at two applications per fiscal year per applicant.

The department has posted program details through the NJDOT Local Aid Resource Center.

Applications received before the October 2026 deadline will compete for the $25 million allocation, continuing a funding stream that has averaged roughly $28 million a year in combined state and private investment in New Jersey's short-line and port-connecting rail infrastructure over the past five years.