EPA's Zeldin Halts $20B in Biden Climate Grants
The decision occurs just a day before a federal judge is set to preside over a hearing regarding a lawsuit filed by one of the grant recipients who is trying to gain access to the funds that the Trump administration had frozen during its investigation of the program.
TroibNews 
EPA Administrator Lee Zeldin announced Tuesday evening that he has canceled $20 billion in climate change grants that were issued by the Biden administration under the Inflation Reduction Act. This action intensifies a legal dispute regarding the Trump administration's possible overreach into Congressional authority.
Over the past month, Zeldin has criticized the spending and has alleged, without supporting evidence, that the program is plagued by fraud. His recent decision comes just a day before a federal judge is set to hear a lawsuit from one of the grant recipients who is seeking access to funds held in a Citibank account that the Trump administration had frozen during an investigation into the program.
“This 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,” Zeldin said in a video posted online. “The only way we can reduce waste, increase oversight and meet the intent of the law as it was written is by terminating these grants.”
In a letter directed to the Climate United Fund, which received a $7 billion grant under this program and has taken legal action to access those funds, EPA stated that the cancellation was "based on substantial concerns" regarding the structure of the Greenhouse Gas Reduction Fund program established by Congress in the 2022 Inflation Reduction Act.
The EPA's letter outlined that the agency lacked “adequate” oversight of the funds and expressed concerns about “improper or speculative allocation of funds,” alongside “the circumvention and defeat” of its oversight capabilities.
“EPA has determined that these deficiencies pose an unacceptable risk to the efficient and lawful execution of this grant that cannot be remedied by imposing specific conditions, necessitating immediate termination to safeguard taxpayer funds and ensure compliance with federal financial assistance regulations,” the letter addressed to Climate United noted. Similar letters were sent to other grant recipients, according to the agency.
Each grantee under the Greenhouse Gas Reduction Fund holds separate contracts with the EPA, which is intended to support climate and housing projects nationwide. However, Zeldin has focused on this program, frequently referencing a video from a conservative activist group featuring a former Biden administration EPA employee who described distributing federal money as “tossing gold bars off the Titanic,” despite the agency having already allocated all the fund's resources months earlier.
Former officials from the Biden administration have maintained that the program was structured to hold the $20 billion in a financial agent agreement with Citibank rather than using the EPA's standard grant process to leverage private investment alongside public funds. They have also stated that the EPA maintains detailed, real-time oversight of the spending.
Nonetheless, Zeldin has continued to label the arrangement as a “slush fund” designed to circumvent agency oversight.
The letter from the EPA instructed Climate United to "cease all further program expenditures immediately" and to provide a full account of its expenditures.
The agency included this letter in a court filing that revealed the termination of the grants.
U.S. District Court Judge Tanya Chutkan is set to hold a hearing Wednesday afternoon regarding Climate United’s request for Citibank to grant access to the funds. Similar lawsuits have also been filed this week by other recipients, including the Coalition for Green Capital and Power Forward Communities.
The ramifications of Zeldin’s grant termination on ongoing litigation remain unclear.
While congressional Republicans are expected to seek the repeal of the GGRF funds, they currently remain intact, and the EPA is still obligated to allocate them.
“EPA will work to re-obligate lawfully appropriated funds in the GGRF with enhanced controls to ensure adequate governance, transparency, and accountability, consistent with statutory requirements,” the agency stated in a press release.
No timeline was provided for these actions; the establishment of the original program and the allocation of funds took nearly two years under the Biden administration.
The agency has not addressed inquiries regarding whether it has taken the steps necessary to instruct Citibank to return the funds to the federal treasury.
Sanya Singh contributed to this report for TROIB News
Over the past month, Zeldin has criticized the spending and has alleged, without supporting evidence, that the program is plagued by fraud. His recent decision comes just a day before a federal judge is set to hear a lawsuit from one of the grant recipients who is seeking access to funds held in a Citibank account that the Trump administration had frozen during an investigation into the program.
“This 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,” Zeldin said in a video posted online. “The only way we can reduce waste, increase oversight and meet the intent of the law as it was written is by terminating these grants.”
In a letter directed to the Climate United Fund, which received a $7 billion grant under this program and has taken legal action to access those funds, EPA stated that the cancellation was "based on substantial concerns" regarding the structure of the Greenhouse Gas Reduction Fund program established by Congress in the 2022 Inflation Reduction Act.
The EPA's letter outlined that the agency lacked “adequate” oversight of the funds and expressed concerns about “improper or speculative allocation of funds,” alongside “the circumvention and defeat” of its oversight capabilities.
“EPA has determined that these deficiencies pose an unacceptable risk to the efficient and lawful execution of this grant that cannot be remedied by imposing specific conditions, necessitating immediate termination to safeguard taxpayer funds and ensure compliance with federal financial assistance regulations,” the letter addressed to Climate United noted. Similar letters were sent to other grant recipients, according to the agency.
Each grantee under the Greenhouse Gas Reduction Fund holds separate contracts with the EPA, which is intended to support climate and housing projects nationwide. However, Zeldin has focused on this program, frequently referencing a video from a conservative activist group featuring a former Biden administration EPA employee who described distributing federal money as “tossing gold bars off the Titanic,” despite the agency having already allocated all the fund's resources months earlier.
Former officials from the Biden administration have maintained that the program was structured to hold the $20 billion in a financial agent agreement with Citibank rather than using the EPA's standard grant process to leverage private investment alongside public funds. They have also stated that the EPA maintains detailed, real-time oversight of the spending.
Nonetheless, Zeldin has continued to label the arrangement as a “slush fund” designed to circumvent agency oversight.
The letter from the EPA instructed Climate United to "cease all further program expenditures immediately" and to provide a full account of its expenditures.
The agency included this letter in a court filing that revealed the termination of the grants.
U.S. District Court Judge Tanya Chutkan is set to hold a hearing Wednesday afternoon regarding Climate United’s request for Citibank to grant access to the funds. Similar lawsuits have also been filed this week by other recipients, including the Coalition for Green Capital and Power Forward Communities.
The ramifications of Zeldin’s grant termination on ongoing litigation remain unclear.
While congressional Republicans are expected to seek the repeal of the GGRF funds, they currently remain intact, and the EPA is still obligated to allocate them.
“EPA will work to re-obligate lawfully appropriated funds in the GGRF with enhanced controls to ensure adequate governance, transparency, and accountability, consistent with statutory requirements,” the agency stated in a press release.
No timeline was provided for these actions; the establishment of the original program and the allocation of funds took nearly two years under the Biden administration.
The agency has not addressed inquiries regarding whether it has taken the steps necessary to instruct Citibank to return the funds to the federal treasury.
Sanya Singh contributed to this report for TROIB News
