Amtrak is taking over the reconstruction of Penn Station from the MTA, U.S. Department of Transportation Secretary Sean Duffy announced Thursday.

Duffy said Amtrak, backed by the USDOT, will now spearhead the initiative, withdrawing the MTA from its role leading the project to “protect American taxpayers.”

The federal grant provided to Amtrak to develop the project will also be rescoped and cut, the USDOT said, which “will save taxpayers approximately $120 million.”

“New York City deserves a Penn Station that reflects America’s greatness and is safe and clean," Duffy said in a statement. "The MTA’s history of inefficiency, waste, and mismanagement also meant that a new approach is needed. By putting taxpayers first, we’re ensuring every dollar is spent wisely to create a transit hub all Americans can take pride in."

Amtrak owns Penn Station and serves over 10 million riders annually, according to USDOT. For that reason, the agency said, “there is no reason to delegate leadership of this important project.”

In a statement, Gov. Kathy Hochul said she supported the takeover.

“In multiple meetings with President Trump, I requested that the federal government fund the long-overdue overhaul of Penn Station. Clearly that effort has been successful, and I want to thank the President and Secretary Duffy for taking on the sole responsibility to deliver the beautiful new $7 billion station that New Yorkers deserve,” Hochul said. “This is a major victory for New Yorkers, and the use of federal funds will save New York taxpayers $1.3 billion that would have otherwise been necessary for this project.”

MTA Chair and CEO Janno Lieber said in his own statement he is glad the federal government will now focus on the project but still expects to participate in Amtrak’s plans.

“Governor Kathy Hochul has prioritized the reconstruction of Penn Station for years, and we’re glad the federal government is focusing on it now. Our 33rd Street Concourse project was the first major improvement to Penn Station in decades — and we finished it on time and under budget,” Lieber said. “As the major leaseholder in the station, we expect to participate in the administration’s and Amtrak’s efforts to ensure future plans meet the needs of everyone who uses it.”

The Trump administration is also pushing for a public-private partnership model for Penn Station. They claim it would “drive efficiencies, reduce costs, and deliver results faster.”

The MTA was awarded a $72 million grant last November. The USDOT says that grant, part of a Federal-State Partnership program, was intended solely for station reconstruction.

The now reduced allocation, according to USDOT, will allow Amtrak to pursue a “master developer” who can also examine potential station expansion.

A proposal put forward by the nonprofit Grand Penn Community Alliance last month would restore features of the original Penn Station — demolished in the mid-1960s — and relocate Madison Square Garden to allow for an outdoor park.

Amtrak provided a statement on that proposal at the time.

“In collaboration with the Federal Railroad Administration and our railroad partners, Amtrak is committed to improving current conditions and increasing train capacity at New York Penn Station while respecting the history and vibrancy of the surrounding neighborhood,” the statement reads. “It is essential that options are evaluated on their ability to meet the transportation needs of the region, and their ability to enhance the Northeast Corridor's critical role in powering the national and regional economy.”