Attorney General Ellison wins ruling protecting billions in critical federal funding
Judge rules Trump Administration cannot subvert will of Congress through obscure regulation
July 20, 2026 (SAINT PAUL) — Attorney General Ellison announced that a coalition of 24 states won a key ruling late Friday afternoon declaring that the Trump Administration illegally misused its regulatory authority to unlawfully pull billions of dollars in federal funding that Congress had set aside for crucial state programs and services.
In her decision, U.S. District Judge Indira Talwani in the District of Massachusetts wrote that five words in U.S. Office of Management and Budget (OMB) regulations-- referencing situations where a grant “no longer effectuates … agency priorities”—did not silently give federal agencies effectively unfettered authority to revoke grants nationwide just because the federal administration claims it is shifting its focus.
“The United States Constitution gives Congress the authority to make spending decisions, and it was absurd for Donald Trump to pretend that five words buried in an obscure federal regulation overrode the Constitution,” said Attorney General Ellison. “I’m pleased to have stopped Trump yet again from illegally slashing billions in funding for important programs, one of which helps our students learn in safety by teaching violence prevention strategies to Minnesota teachers. As long as Donald Trump continues to willfully violate the law, I will continue to challenge him in court to protect our state."
Without providing any lawful justification and without any advance warning or explanation, the Trump Administration relied on this regulation to gut funding across the entire federal government. A multistate coalition sued to stop the unprecedented attack on June 24, 2025. Prior to the second Trump Administration, federal agencies never terminated grants merely because the agency’s priorities shifted midway through the grant period.
The multistate complaint argued that the Trump Administration’s decision to invoke the regulation to terminate grants based on their changed agency priorities is unlawful. The lawsuit explained that the regulation does not authorize federal agencies to terminate grants based on changes in agency preferences that occur after a grant is awarded. The lawsuit also noted the importance of obtaining clarity regarding the scope of this regulation, as states collectively accept hundreds of billions of dollars a year that are at risk of termination pursuant to this regulation.
Judge Talwani granted the states a declaratory judgment that the OMB regulation and the agencies’ regulations do not independently authorize the Trump Administration to terminate funding based on agency priorities that were only identified after the grant was awarded.
In Minnesota, since January 20, 2025, the Trump Administration has terminated tens of millions of dollars in federal grant funding in this fashion, defunding important state programs. One such grant in Minnesota, terminated on April 22, 2025, provided federal funding for training programs that create safer learning environments by training teachers and school administrators on violence prevention strategies. The grant was authorized by Congress with the passage of the STOP School Violence Act of 2018.
Nationwide, the indiscriminate cuts have caused programmatic chaos and uncertainty for grantees, including those working to combat violent crime, conduct lifesaving medical and scientific research, educate students, protect clean drinking water, safeguard public health, address food insecurity, and much more.
The attorneys general of New Jersey, Massachusetts, and New York led the case. In addition to Attorney General Ellison, the coalition consisted of the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Illinois, Maine, Maryland, Michigan, Nevada, New Mexico, Oregon, Rhode Island, Vermont, and Wisconsin, as well as the governors of Kansas, Kentucky, and Pennsylvania.
