November 4, 2025
States lose $7 billion in road, bridge, and transit funding threatened over immigration policy
The Trump administration's transportation grants scheme started in early 2025. Officials told states that to receive federal Department of Transportation (DOT) grants, they had to agree to cooperate with federal immigration enforcement. California gets about $7 billion annually in DOT funding. These grants pay for highways, bridges, transit systems, airports, and railroads. The money comes from Congress and has nothing to do with immigration. But the administration said: cooperate on immigration or lose the money.
California Attorney General Rob Bonta led the fight back. In Jun. 2025, Bonta and 20 other attorneys general sued the Trump administration in federal court in Rhode Island. They argued the administration didn't have legal authority to add immigration conditions to transportation grants. Congress had decided how to spend transportation money. The president couldn't rewrite those rules. Even if the president opposed the states' immigration policies, that wasn't enough to take away money Congress appropriated for roads and bridges.
The federal judge agreed immediately. In Jun. 2025, before full briefing was done, the court issued a preliminary injunction blocking the administration's effort. The judge found that the states would likely win. The administration couldn't prove it had authority to impose these conditions. The judge let transportation money flow to the states.
The administration appealed, but the case moved fast. By Nov. 4, 2025, the same federal judge issued a final ruling: a permanent injunction vacating the administration's guidance. The judge's words were sharp. The Trump administration had 'blatantly overstepped their statutory authority, violated the APA, and transgressed well-settled constitutional limitations on federal funding conditions.' The Constitution demands the court set aside this 'lawless behavior.'
The judge found multiple legal violations. First, the administration lacked statutory authority. Congress decides what conditions can be placed on grants. The administration can't just add new ones. Second, the administration violated the Administrative Procedure Act by issuing binding guidance without notice-and-comment. Third, the administration violated the Spending Clause of the Constitution. The Spending Clause lets Congress condition grants—like 'use this highway money only for highways'—but not to coerce states into adopting federal policies they reject.
By Nov. 2025, the Trump administration faced a choice: appeal to the Supreme Court or quit. It quit. The Department of Justice filed a motion to dismiss its appeal. The administration conceded the case. The ruling stands nationwide. States keep their transportation money. The administration can't use federal funding as a lever to force immigration policy compliance.
What this case teaches about power: The federal government controls massive sums of money Congress appropriates. But that power has limits. The president can't just add conditions to grants unilaterally. States have constitutional protections under the Spending Clause. When the administration tries to use money as a weapon to force policy compliance on unrelated issues, courts will stop it. Even in a conservative moment, federalism still matters.