March 19 (UPI) -- A federal judge ruled that the Environmental Protection Agency can't cancel climate grants issued during the Biden administration, but the grantees cannot access the money either.
The decision by U.S. District Judge Tanya Chutkan stopped the EPA from canceling the distribution of $20 billion that it had deposited in a Citibank account for nonprofits, including Climate United, Coalition for Green Capital and Power Forward Communities.
Chutkan wrote that the EPA grant termination letters only "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," and that "this is insufficient."
The grants were issued under the Inflation Reduction Act, which passed Congress and was signed into law in 2022. The Act authorized the Greenhouse Gas Reduction Fund, which made grants available to eligible climate projects.
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Among the grantees were nonprofits Climate United, Coalition for Green Capital and Power Forward Communities, who are the plaintiffs in Chutkan's decision. The three nonprofits were granted an approximate total of $14 billion, and that money is held by Citibank; five other nonprofit groups were the recipients of the remainder of the $20 billion total.
The EPA issued a letter to the plaintiffs on March 11 that terminated the grants, leading them to move for temporary restraining orders to prevent Citibank from not "violating its legal and contractual obligations to disburse grant money owed" to the plaintiffs and stop the EPA from terminating the grants.
However, Chutkan's court order also states that as this is a temporary order.
"The court merely orders the parties to preserve the status quo -- that is, for Citibank to maintain the grant funds in Plaintiffs' respective accounts," it said.
This means that while the grant money has not been given back to the government, maintaining the "status quo" will also keep the grants from being withdrawn for use by the nonprofits.
EPA Administrator Lee Zeldin posted a statement to X Tuesday that confirmed the grants are "frozen by court order."
Zeldin also said that the EPA under the Biden presidency was "riddled with self-dealing and wasteful spending," and that he "will not rest" until the grant money has been returned to the U.S. Treasury.
Meanwhile, as the grants remain locked to all parties involved, Climate United could end up "furloughing or laying off staff," among other "imminent harms" the company declared in the suit could happen without the expected grant funding. In a press release, Climate United stated Tuesday it "will continue its legal process to fully restore its program."
