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The 7 train extension seems to still be moving along:

From WNYC.org http://www.wnyc.org/news/articles/134949

Quick Progress Digging Number 7 Extension Line
by Matthew Schuerman

NEW YORK, NY June 22, 2009 —Some of the toughest parts in big public works projects come when government agencies, each with their own turf, have to work together. To celebrate one collaboration that's worked out well, the MTA took WNYC's Matthew Schuerman on a tour yesterday of an unfinished subway tunnel underneath the Port Authority Bus Terminal. Here's his report.

REPORTER: In January, contractors began digging a giant trench in the basement of the Port Authority bus terminal. It's 80 feet wide, and 80 feet deep and 150 feet long. It lies right underneath the entrance ramp Greyhound buses take to get to the terminal's lower level. Joe Trainor, MTA's chief engineer:

TRAINOR: This was all of the work we've done in the last six months, which is absolutely mind-boggling.

REPORTER: Now, they have to clean up, and wait. This elaborate operation is just a small piece of the $2.2 billion extension of the Number 7 subway line. When finished, the line will take riders west along 41st street to 11th avenue and then south to 34th street. Just last week, the first tunnel boring machine started snaking its way in the opposite direction, north from its starting point in Chelsea. It's digging the tunnel where the Queens-bound trains will eventually go. The machine for the other tunnel is expected to start any day now.

TRAINOR: If you look over here on this wall, those two lines indicate where those two tunnel boring machines will come through into this pit. The first will come in here on the left, the second machine will come in shortly after that on that side.

The tunnel boring machines are giant 50-ton drill bits that grind through dirt and bedrock. They're expected to arrive at this cavern next spring. The MTA got started digging the cavern early just in case.

TRAINOR: And there were people saying, well, we've got time, and my feeling was, you never have time. You have to do as much as you whenever you can do it.

In fact, the MTA expected the cavern would take two to three years to dig, instead of just six months. But fortunately the Port Authority allowed the MTA to work under the bus terminal 24-hours a day. But Trainor isn't breathing easy yet. He says the entire project is so ambitious, it'll be tough to get finished by the 2013 deadline the MTA has set for itself.

TRAINOR: This is only the first phase. The object is not to build a tunnel, it's to build a subway with the tracks the signals the pump stations, all of the electrical and mechanical gear.

While all of the blasting and excavating was going on underground, customers were waiting for buses just 20 feet away. For a while, buses were diverted to allow easy access for the excavation. But now, 6,000 cubic yards of rock later, workers have covered the pit back up with concrete slabs. And traffic in the bus terminal has gotten back to normal.