A federal judge has ordered the Trump administration to release billions of dollars in climate and infrastructure funds that had been frozen by executive order, ruling that the halt violated federal law and put critical projects at risk.
The decision, issued Tuesday by U.S. District Judge Mary McElroy, imposes a nationwide injunction on the administration’s freeze of grants from the Inflation Reduction Act (IRA) and the Infrastructure Investment and Jobs Act (IIJA)—two cornerstone laws of the Biden administration. The ruling comes in response to a lawsuit brought by several environmental and community nonprofits, who alleged that the freeze was unlawful and had already caused direct harm to public health, environmental, and economic initiatives.
“Today’s ruling marks a crucial victory for the rule of law and ensures these vital resources will flow to the people and projects Congress intended to support,” said Skye Perryman, president of Democracy Forward, the legal group representing the plaintiffs, in a statement.
The lawsuit, filed on March 13 in a U.S. District Court in Rhode Island, was brought by five nonprofit organizations: Eastern Rhode Island Conservation District, Woonasquatucket River Watershed Council, Codman Square Neighborhood Development Corporation, Childhood Lead Action Project, and the National Council of Nonprofits. The defendants included the Departments of Energy, Interior, Agriculture, Housing and Urban Development, the Environmental Protection Agency, the Office of Management and Budget, and the National Economic Council.
“We are pleased that a federal court has seen the Trump administration’s freeze of congressionally approved funds for what it is: another abuse of executive power that has already inflicted harm on communities nationwide,” Perryman said.
The freeze was initiated on Jan. 20, the first day of President Donald Trump’s second term, through an executive order pausing the disbursement of grant awards under the IRA and IIJA. These awards had funded efforts such as training workers about lead safety, protecting ancient sequoias, reducing wildfire risk, and improving air quality for seniors. But grant recipients reported widespread confusion as they discovered their funding had suddenly been halted.
In her ruling, McElroy sharply criticized the administration’s handling of the freeze, writing that the government’s “about-face” had been communicated through “a combination of confusion and silence.”
The court rejected arguments by the Justice Department that the dispute amounted to a contract issue that should be heard in a different court. “Since the Court finds that the proper source of the Nonprofits’ rights is federal statute and regulations and because the relief sought is injunctive in nature, the Court determines that the ‘essence’ of the action is not contractual in nature,” McElroy wrote.
She further rejected the administration’s claim that the freeze was a valid exercise of executive authority. “Agencies do not have unlimited authority to further a President’s agenda, nor do they have unfettered power to hamstring in perpetuity two statutes passed by Congress during the previous administration,” McElroy wrote, as reported by the Associated Press.
While affirming that “elections have consequences and the President is entitled to enact his agenda,” she clarified that executive discretion does not include blocking the implementation of laws passed by Congress without legal justification.
The court’s order bars the five federal agencies from continuing to withhold the funds and prohibits the administration from reinstating the freeze “under a different name.” The Office of Management and Budget and the National Economic Council were also ordered to issue written notice of the injunction to all federal agencies that received the original memorandum instructing them to halt disbursements.
According to the plaintiffs, the freeze had already interrupted environmental and infrastructure work underway in communities across the country. Projects funded through the IRA and IIJA have included clean energy development, environmental restoration, public health outreach, and job training programs, many of which had already begun implementation before the freeze.
Perryman called the ruling a critical step toward restoring legal and fiscal certainty to those programs. “By blocking these investments in local communities and projects, the administration is jeopardizing public health initiatives, environmental protections, and economic stability,” she said.
The lawsuit will continue to move through the courts, but the preliminary injunction means the frozen funds must now be released immediately. The Trump administration is barred from using similar administrative tactics to stall the laws while litigation is ongoing.
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