On May 20, 2025, the federal district court for the District of South Carolina ordered Trump administration defendants to immediately restore access to 32 terminated or frozen grants under the Inflation Reduction Act, Infrastructure Investment and Jobs Act, or other “mandatory legislation.” The defendants did not contest judgment on the merits of the plaintiff’s Administrative Procedure Act (APA) claims but opposed the injunctive relief. The court granted judgment to the plaintiffs on the APA claims, based on the “full record” and the defendants’ concession, finding that the plaintiffs produced “substantial, highly persuasive evidence to support their claims that their grant funds were frozen and/or terminated because Defendants disfavored previously authorized congressional appropriations and that such actions were outside of the legal authority of the agency Defendants and in violation of the Constitution’s separation of powers.” The court further concluded that a stay of the injunctive relief was not appropriate, finding that the defendants were unlikely to succeed on their challenges to the court’s jurisdiction. The court also found that the federal defendants did not demonstrate irreparable injury; in addition, the court cited harms to the plaintiffs as well as the public interest in upholding the rule of law. The court also found that it had jurisdiction over the plaintiffs’ nonstatutory review claims of separation of powers violation and ultra vires action, which the court described as a “mirror image[]” of the plaintiffs’ APA claims that the defendants no longer contested. The court found that the plaintiffs had standing for the nonstatutory review claims and granted preliminary injunctive relief on the basis of the nonstatutory review claims. The court concluded, however, that the plaintiffs did not meet the standard for preliminary injunctive relief for six grants that were awarded under the U.S. Department of Agriculture’s (USDA’s) Partnerships for Climate Smart Commodities. The defendants said the grant funds were from general appropriations and that USDA therefore had “broad discretion in the use of these funds” that was different from the appropriations under mandatory legislation.  The defendants appealed the order, as well as the court’s April order finding that it had subject matter jurisdiction over the case.

Community groups' and cities' lawsuit alleging that the Trump administration had unlawfully and arbitrarily frozen federal grant funds, including for programs and projects to reduce greenhouse gas emissions.

Sustainability Institute v. Trump

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South Carolina Federal Court Ordered Restoration of 32 Grants Under Inflation Reduction Act and Other “Mandatory Legislation”

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United States of America

South Carolina

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South Carolina Federal Court Ordered Restoration of 32 Grants Under Inflation Reduction Act and Other “Mandatory Legislation”

Policy instrument

Risk

Impacted group

Economic sector

Finance