Judge blocks Trump’s EPA from terminating $14 billion in ‘green bank’ grants after accusations of fraud
A federal judge issued a ruling on Tuesday that halted the Environmental Protection Agency (EPA) from terminating $14 billion in grants designated for three climate groups by the Biden administration. U.S. District Judge Tonya Chutkan determined that the EPA’s claims of fraud were insufficient and vague, preventing the agency from ending the grant program totaling $20 billion. The judge also prohibited Citibank, the institution holding the funds on behalf of the EPA, from transferring the money to the government or any other entity.
EPA Administrator Lee Zeldin alleged that the grant recipients were involved in mismanagement, fraud, and self-dealing, leading him to freeze and seek termination of the grants. However, Judge Chutkan found Zeldin’s accusations to be lacking in substance. She stated, “At this juncture, EPA Defendants have not sufficiently explained why unilaterally terminating Plaintiffs’ grant awards was a rational precursor to reviewing the green bank program.”
The grant recipients, including Climate United, the Coalition for Green Capital, and Power Forward Communities, took legal action against the EPA, Zeldin, and Citibank, arguing that they were unlawfully denied access to the $14 billion allocated through the Greenhouse Gas Reduction Fund. This fund, often referred to as a “green bank,” was established under the 2022 Inflation Reduction Act by Congress to support clean energy and climate-friendly initiatives.
Climate United, awarded nearly $7 billion, the Coalition for Green Capital, granted $5 billion, and Power Forward Communities, linked to Stacey Abrams, who received $2 billion, claimed that the frozen grants hindered their ability to finance new projects and could result in staff layoffs. They maintained that the allegations of mishandling funds were baseless.
The groups requested that Citibank unfreeze the account, but Judge Chutkan declined, opting to maintain the status quo while the legal proceedings continue.
EPA Administrator Lee Zeldin expressed his determination to ensure that the taxpayer dollars are safeguarded, emphasizing that the grants were distributed in a manner that limited governmental oversight. Zeldin described the grants as part of a “gold bar” scheme involving conflicts of interest and potential fraud.
Beth Bafford, CEO of Climate United, welcomed the judge’s ruling as a positive step forward. She affirmed their commitment to pursuing a long-term solution that would enable them to invest in projects that promote energy savings, job creation, and bolster American manufacturing across communities nationwide.
The ongoing legal battle underscores the importance of transparency and accountability in the distribution of government grants and funding for climate-related initiatives. As the case unfolds, stakeholders will continue to monitor the developments closely to ensure that the integrity of the grant program is upheld.
