Pennsylvania Gov. Shapiro sues Trump administration, citing frozen IRA funding

Federal businesses are unlawfully proscribing Pennsylvania businesses from accessing funding for packages like Photo voltaic For All and greenhouse gasoline emissions mitigation, stated state Gov. Josh Shapiro, D, in a lawsuit filed Thursday.

“Since round January 27, 2025, federal businesses have restricted Pennsylvania businesses’ capability to entry funding for grant packages that, in complete, obligated over $3.1 billion to Pennsylvania for fiscal years 2022 to 2026,” the lawsuit says.

This funding consists of $156 million for the Inflation Reduction Act’s Solar for All program, which the lawsuit cites for instance of a grant award the place the state has already executed an settlement for a subaward. The state has “an settlement is in place with the Philadelphia Inexperienced Capital Company to subaward about $70 million,” in line with the swimsuit.

“Many of those grant packages have deadlines by which Commonwealth businesses should use their grant award,” the lawsuit says. “However, federal businesses are actually unilaterally and arbitrarily suspending or proscribing Commonwealth businesses’ entry to the congressionally appropriated grant funds which were dedicated to them.”

President Donald Trump’s first-day govt order Unleashing American Energy directed that “all businesses shall instantly pause the disbursement of funds appropriated via the Inflation Discount Act of 2022 or the Infrastructure Funding and Jobs Act,” however the plaintiffs argue {that a} unilateral suspension of state funds already appropriated and obligated by Congress violates the U.S. Structure. 

The swimsuit was filed within the U.S. District Courtroom for the Japanese District of Pennsylvania. Shapiro, the Pennsylvania Division of Environmental Safety, or DEP, the Pennsylvania Division of Conservation and Pure Assets, the Pennsylvania Division of Transportation, and the Pennsylvania Division of Neighborhood and Financial Growth are named as plaintiffs.

Shapiro is the primary governor to provoke a lawsuit in opposition to the Trump administration over the funding freeze, however Kentucky Gov. Andy Beshear, D, on Thursday joined a swimsuit filed by attorneys basic representing 22 states. 

The defendants named are the U.S. Division of the Inside, the U.S. Environmental Safety Company, the U.S. Division of Vitality, the U.S. Division of Transportation, and the Workplace of Administration and Funds, in addition to the top of every division or company.

Regardless of “two non permanent restraining orders requiring federal businesses to revive entry to suspended funds,” the plaintiffs should not in a position to entry the funding appropriated to those packages, the lawsuit asserts.

The lawsuit additionally claims that federal businesses have threatened to not reimburse Pennsylvania businesses if the federal company doesn’t assist the actions of subrecipients who acquired grants allotted by the IRA and the Infrastructure Funding and Jobs Act.  

“The Commonwealth thus both violates its obligations to subrecipients by withholding cash, or it dangers being denied reimbursement later by the federal authorities,” says the criticism.

The lawsuit says that DOE is withholding reimbursement for 2 DEP grants for $127 million to enhance power effectivity in low revenue houses, in addition to an $186 million grant for the Pennsylvania Division of Neighborhood and Financial Growth’s weatherization help program, till DOE completes a evaluate of the grants.

DEP can also be unable to obtain reimbursements for expenditures of the remaining $76 million in funding that the IIJA allotted to the company for “plugging, remediating, and restoring orphaned properly websites” which, with out remediation, function a supply of greenhouse gasoline emissions, the lawsuit alleges.

An OMB doc issued Jan. 28 said that the administration’s pause on the disbursement of federal funding is “restricted to packages, initiatives, and actions implicated by the President’s Govt Orders,” together with “the Inexperienced New Deal,” a phrase which Trump has used to seek advice from the IRA in addition to components of the IIJA.