Trump's EPA vaults over court obstacles to cancel $16B in climate grants amid corruption allegations
By willowt // 2025-09-05
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In a major policy split, the U.S. Court of Appeals for the D.C. Circuit this week enabled the U.S. Environmental Protection Agency (EPA) to cancel $16 billion in Biden-era climate grants, overturning a months-old district court injunction. The decision marks a victory for EPA Administrator Lee Zeldin’s crusade to rescind taxpayer-funded green energy programs he deems riddled with fraud and regulatory excess.
  • Appeals court allowed cancellation of $16B in climate grants, ruling lower court lacked jurisdiction.
  • Administrator called the Green Bank program a “gold bar scheme,” citing fraud risks, waste and misaligned policy goals.
  • EPA awarded $20B to 8 nonprofits under 2022 Inflation Reduction Act; $4B remains contested in ongoing disputes.
  • Nonprofits sued, arguing funds were unlawfully withheld, causing project cancellation and financial harm.
  • Majority judges stated claims belong in Court of Federal Claims, not district courts.
On September 2, a divided D.C. Circuit panel ruled 2–1 that a lower court judge overstepped her authority by prohibiting the EPA from halting $16 billion in grants funneled to climate nonprofits. The case, Climate United Fund v. Citibank, arose after the Trump administration’s EPA froze disbursements in February 2025, then terminated the Greenhouse Gas Reduction Fund—nicknamed the “green bank”—in March. This $20 billion initiative, launched under the 2022 Inflation Reduction Act, was designed to subsidize clean energy projects through nonprofit intermediaries. The EPA claims the program lacked sufficient oversight, with Zeldin alleging “programmatic fraud, waste and abuse.” Opposing nonprofits, such as Climate United Fund, countered that the freeze jeopardized renewable energy projects and caused operational crises.

Judicial showdown and big-picture implications

The appeals court’s jurisdictional ruling hinged on procedural technicalities. Circuit Judge Noemi Rao’s majority opinion emphasized that federal district courts cannot intervene in contractual disputes between the government and grantees. Nonprofits, she wrote, must pursue claims through the Court of Federal Claims, which handles suits against the U.S. government. Dissenting Judge Cornelia Pillard accused the majority of enabling “sabotage” of Congressionally approved climate initiatives. “This agency and this administration have weaponized dubious process objections to block spending greens were authorized to disburse in service of urgent national goals,” she protested, noting projects abandoned due to funding delays include affordable housing and renewable energy ventures. This ruling aligns with the Trump EPA’s broader rollback of Biden’s climate agenda. Since taking office in January, the administration has targeted what it brands “excessive spending” and regulatory overreach, including dissolving diversity, equity and inclusion offices. The green bank termination fits a fiscal conservative narrative advocating accountability for taxpayer dollars.

Zeldin’s fiscal case: Sabotaging “green tyranny” or deregulatory backsliding?

EPA Administrator Zeldin described the green bank as a “gold bar” scheme — a term implying efforts to line special interests’ pockets at public expense. His March termination memo cited “substantial concerns regarding program integrity” and conflicts of interest. While supporters of the program accuse Zeldin of politicizing climate initiatives, conservatives frame the move as essential to rooting out bureaucratic waste. The program’s $20 billion was allocated to eight nonprofits, with $14 billion later approved for sub-grantees. Critics argue this layer of private-sector intermediaries invited mismanagement, while defenders cite streamlined disbursement as a strength. Zeldin’s decision to seize all undistributed funds, however, has drawn constitutional challenges over executive authority. The D.C. Circuit’s focus on jurisdiction sidestepped the merits of the EPA’s claims. Yet, the result aligns with conservative legal theories prioritizing agency autonomy over activist judicial interventions. “This isn’t about climate but about who gets to spend tax money — and by what law,” said one analyst.

A return to fiscal traditions? History of EPA turnover

The green bank reversal mirrors past deregulatory drives. During the Reagan era, EPA overhauls emphasized cost-benefit analyses over environmental mandates; the Trump EPA’s latest steps echo this by questioning the “intent of the law” as written. Zeldin’s arguments echo fiscal conservatism’s core tenets: limited government, procurement transparency and financial accountability. For Democrats, the program’s termination represents ideological betrayal. “This administration is gutting vital climate investments,” Senate Minority Leader Chuck Schumer remarked, arguing these projects could have lowered energy costs and curbed emissions. Conversely, Republicans criticize the subsidies as corporate handouts masquerading as environmentalism.

Final analysis: A larger budgetary turning point?

The green bank case underscores fiscal conservatism’s ascendance in Washington. As Zeldin and the White House prioritize tightening belts, courts increasingly find in favor of administrative discretion over judicial expansionism. While the ruling paves the way for reclaiming billions, its long-term impact hinges on ongoing legal battles. The nonprofits could appeal to the Supreme Court, though conservative-leaning Justices may share Rao’s judicial restraint. For now, the story remains a landmark in the fight over Washington’s spending authority — and a stark reminder of how partisan leadership shifts rewrite public policy. Sources for this article include: ZeroHedge.com TheEpochTimes.com TheEpochTimes.com
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