Judge Blocks EPA From Terminating Part of $20 Billion Biden-Era Climate Grants

The Environmental Protection Agency acted unlawfully when it froze the funding in February, the judge found.

Vice President JD Vance (R) and Ohio Gov. Mike DeWine (L) listen as Environmental Protection Agency Administrator Lee Zeldin (C) speaks at the East Palestine Fire Station in East Palestine, Ohio, on Feb. 3, 2025. Gene J. Puskar /AP Photo

A federal judge on April 15 blocked the Environmental Protection Agency (EPA) from terminating part of the $20 billion Biden-era climate grants, finding that the agency acted unlawfully when it froze funding for awardees and sub-awardees in mid-February.

In a three-page order, District Judge Tanya S. Chutkan ruled in favor of the Climate United Fund and other groups that sued Citibank, the EPA, and EPA Administrator Lee Zeldin in March for withholding the funds.

Chutkan said the EPA may not suspend the awards in any way, including by issuing a notice of exclusive control of termination or by limiting the groups’ access to the money.

The judge said the EPA and officials at the Treasury Department may also not directly or indirectly impede, obstruct, or delay Citibank from dispersing the funds to the nonprofits.

Chutkan instructed Citibank not to transfer or otherwise move the funds out of accounts established in connection with the grants until after 2 p.m. on April 17.

The EPA immediately appealed the decision.

Beth Bafford, CEO of Climate United Fund, welcomed the ruling in a statement.

“Today’s decision gives us a chance to breathe after the EPA unlawfully—and without due process—terminated our awards and blocked access to funds that were appropriated by Congress and legally obligated,” Bafford said. “After a year-long application process, we were hired to do a job that we’ve done for decades: investing in communities and strengthening markets. We want to get back to work.”

Chutkan’s decision comes after the EPA announced in March that it had terminated grants that were part of a $20 billion climate funding program created by the previous administration, amid concerns over a lack of oversight and transparency.

The program, formally known as the Greenhouse Gas Reduction Fund but more commonly called the “green bank,” was approved under the 2022 Inflation Reduction Act and saw the EPA award $20 billion in grants to eight entities to launch climate-related projects.

In announcing the cancellation of the program in March, Zeldin described it as a “gold bar” scheme.

He said the decision to terminate the program was based on “substantial concerns regarding program integrity, objections to the award process, programmatic fraud, waste and abuse, and misalignment with the agency’s priorities.”

Climate United Fund sued shortly after, arguing that the agency had acted illegally to prevent Citibank from dispersing funds and that its actions harmed Climate United, its borrowers, and the communities it serves, jeopardizing the organization’s operations.

“Without those grant funds, Climate United will shortly run out of cash to pay operating expenses—it will no longer be able to pay its employees, pay rent, pay critical service providers and contractors, or meet its commitments under the loans and awards it has already approved,” the organization wrote in the lawsuit.

Chutkan issued a temporary restraining order in March preventing the EPA from terminating the grants, finding that there was insufficient evidence to back up the agency’s concerns regarding possible waste, fraud, and abuse.

The Trump administration challenged that order, saying it had a legal basis to end the contracts based on oversight concerns and shifting priorities.

Chutkan’s latest order unfreezes $14 billion of the $20 billion total for Climate United, the Coalition for Green Capital, and Power Forward Communities.

The Epoch Times has contacted the EPA for comment.