Donald Trump is being crushed by lawsuits over his questionable executive orders. (Photo: Gage Skidmore)
Donald Trump’s use of a single clause buried in federal regulations to cancel billions of dollars in critical state grants has prompted the latest legal challenge to his administration.
New York Attorney General Letitia James and a coalition of 21 other attorneys general today (June 24) filed a lawsuit to block cuts to grants that support programs to combat violent crime, educate students with special needs, protect clean drinking water and repair crumbling infrastructure.
“From slashing money for law enforcement to cutting grants that provide resources for vulnerable students, this administration’s reckless funding cuts have put communities throughout our country at risk,” said James.
Click Here to Read the Lawsuit
The suit argues that the Trump administration is using this clause in Office of Management and Budget (OMB) regulations to impose mass funding cuts – even when Congress has specifically directed spending on a particular program.
In the lawsuit, filed in the United States District Court for the District of Massachusetts, James and the coalition are seeking a judgment from the court ruling that the administration cannot cut grant funding in this way.
“On top of causing dangerous chaos and confusion, these cuts are simply illegal,” James asserted.
“Congress has the power of the purse, and the president cannot cut billions of dollars of essential resources simply because he doesn’t like the programs being funded.”
The OMB regulation in question was adopted in 2020 and states that federal agencies may terminate a grant if it “no longer effectuates the program goals or agency priorities.”
OMB has made clear that the regulation only gave agencies limited power to end certain grants. Agencies need additional evidence that a particular grant is not effective at achieving a program’s goals, and the regulation cannot be used to arbitrarily make mass funding cuts, according to the suit.
But the Trump administration along with Elon Musk’s Department of Government Efficiency (DOGE) began using this language to terminate grants on a massive scale.
The administration slashed billions of dollars in funding for states on the grounds that federal agency priorities have changed since the grants were awarded.
No administration has ever used OMB’s regulation in this way. As Attorney General James and the coalition argue, this provision has important limitations, and it cannot overrule Congress’s appropriations laws.
The cuts have jeopardized preparation for natural disasters, lifesaving medical research, efforts to keep drinking water clean and safe, improvements to state unemployment systems, and more, the coalition asserts.
The Department of Justice has used the OMB regulation to pull funds for state law enforcement to combat hate crimes.
The Environmental Protection Agency (EPA) terminated funding to research new ways to eliminate “forever chemicals” from drinking water.
In New York, the Department of Agriculture cut a program to connect communities facing food insecurity with local farms that provide high-quality produce.
The Department of Labor cut over $20 million of grants to help New York upgrade its unemployment insurance system to make it easier for people who have lost their jobs to get assistance.
James and the coalition argue that federal agencies do not have the power to cut funds on a whim based on new “agency priorities” that did not exist when the grants were made.
Attorney General James is leading this lawsuit with the attorneys general of Massachusetts and New Jersey. The coalition also includes the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Michigan, Minnesota, Nevada, New Mexico, Oregon, Rhode Island, Vermont, Wisconsin, and the District of Columbia, along with the state of Pennsylvania.