Federal Funding Hostage Scheme: 20 State Attorneys General Sue to Protect Grants and Aid from Immigration-Related Strings

Strategic Insights -

Twenty Democratic state attorneys general, including New Jersey's Matt Platkin, have joined forces to sue federal agencies over what they call a "grant funding hostage scheme." The plot involves tying federal funding for emergency preparedness, disaster relief, and infrastructure projects to states' cooperation with federal immigration policies. The attorneys general, representing 20 states, claim this violates constitutional protections for separation of powers and the spending power.

Key Takeaways:

  • The lawsuit against the U.S. Department of Homeland Security and the U.S. Department of Transportation aims to protect billions of dollars in federal funding already awarded to states for various projects.
  • The attorneys general argue that the federal agencies' actions will force states to choose between readiness for disasters and emergencies and their judgment on how to investigate and prosecute crimes.
  • The lawsuit alleges that the federal agencies' actions are a clear violation of constitutional separation of powers and the spending power.
  • The attorneys general also contend that the federal agencies' actions will harm states and force them to scale back or terminate critical public safety and transportation programs.
  • The state attorneys general have successfully halted or protected various federal policies and funding in the past, including education, research funding, public health, and grants and aid to state governments.

Statistics:

  • The loss of federal funding will cause state and local providers to scale back or terminate many critical public safety and transportation programs.
  • More cars, planes, and trains will crash, and more people will die as a result, if federal funding is cut off to Plaintiff States.
  • Rhode Island received more than $45 million in FEMA grants in 2024 alone.
  • The federal government provides $3 billion in FEMA money to states each year.
  • The new lawsuits reprise language of the 20 state AG lawsuits against the Trump administration that preceded them, calling the executive agencies' actions "arbitrary and capricious."
  • The lawsuit mentions the $221 million Biden-era infrastructure grant awarded to Rhode Island for the Washington Bridge project.

Sources:

  • New Jersey Monitor
  • Rhode Island Current
  • (https://rhodeislandcurrent.com/wp-content/uploads/2025/05/Illinois-v.-FEMA-Filed-Complaint-1.pdf)
  • (https://rhodeislandcurrent.com/wp-content/uploads/2025/05/State-of-California-et-al.-v.-USDOT-et-al.-Complaint.pdf)
  • (https://rhodeislandcurrent.com/wp-content/uploads/2025/05/2025_0418_fy2025_dhs_terms_and_conditions_version_3.pdf)
  • (https://rhodeislandcurrent.com/wp-content/uploads/2025/05/Follow-the-Law-Letter-to-Applicants-4.24.25.pdf)
  • (https://newjerseymonitor.com/wp-content/uploads/2025/05/AGs-zoom-call.png)