Federal judge temporarily blocks EPA's effort to cancel $20 billion in climate grants

A federal judge on Tuesday temporarily blocked a move by the Environmental Protection Agency to cancel more than $20 billion in climate grants awarded under the Biden administration, stating that the EPA had failed to provide sufficient evidence the grants were examples of waste and fraud.

The ruling comes after EPA Administrator Lee Zeldin claimed in February that the agency found that "roughly twenty billion of your tax dollars were parked at an outside financial institution" by the Biden administration.

That outside institution was Citibank, which was holding the funds for the EPA and was distributing the money to numerous grant recipients who had been awarded money through the Greenhouse Gas Reduction Fund, a program under the 2022 Inflation Reduction Act "to mobilize financing and private capital to address the climate crisis."

Zeldin initially froze the funds, and then cancelled the grants on March 11, saying in a video statement at the time that the "termination is based on substantial concerns regarding program integrity, objections to the award process, programmatic fraud, waste and abuse and misalignment with the agency's priorities, which collectively undermine the fundamental goals and statutory objectives of the awards."

U.S. District Judge Tanya Chutkan issued a temporary restraining order against the cancellations in response to the lawsuit brought by several of the grant recipients, who sued the EPA over breach of contract. They also claimed the agency's actions "violated multiple regulations, statutes, and constitutional provisions."

"In the termination letters, EPA Defendants vaguely reference 'multiple ongoing investigations' into 'programmatic waste, fraud, and abuse and conflicts of interest' but offer no specific information about such investigations, factual support for the decision, or an individualized explanation for each Plaintiff," Chutkan wrote.

Chutkan added that, in a March 12 hearing over the lawsuit, "when pressed" to provide evidence, an attorney for the EPA "was unable to, stating that he was only aware of media reports discussing the termination."

Many grant recipients were scrambling to cover basic operating costs without the grant money — and were on the verge of furloughing staff and potentially closing their businesses — due to the freezing and termination of funds.

In her opinion, Chutkan found that they were awarded the grants "pursuant to a statute authorized by Congress," and that the EPA did not give the plaintiffs "an opportunity to object and provide information challenging the action when it unilaterally terminated their grants."

President Trump said last month that Zeldin was looking to slash the EPA's budget by about 65%, part of the White House's effort to undo a slew of environmental regulations. The EPA announced last week that it would begin the process of repealing or revising dozens of environmental rules, including a 2009 finding that greenhouse gases are dangerous to public health.

CBS News obtained documents earlier Tuesday that show the Trump administration plans to eliminate the EPA's Office of Research and Development, the agency's primary research body. Such a move would result in the loss of about 1,000 positions.