NATIONAL NEWS

Federal judge bars Trump administration from using obscure clause to make huge funding cuts

Jul 17, 2026, 4:05 PM

Russell Vought, acting director, Office of Management and Budget, testifies before the House Financ...

Russell Vought, acting director, Office of Management and Budget, testifies before the House Financial Committee on the Consumer Financial Protection Bureau (CFPB) semi-annual report, on Capitol Hill in Washington, Wednesday, July 15, 2026. (AP Photo/Cliff Owen)
Credit: AP Photo/Cliff Owen

(AP Photo/Cliff Owen)

BOSTON (AP) — A federal judge in Boston on Friday ruled the Trump administration can’t use an obscure clause relating to agency priorities to make billions of dollars in funding cuts.

Twenty-three states had a filed a lawsuit last year accusing the administration of using the clause to make cuts to everything from crime prevention to food security to scientific research. They were concerned that it would be used to cancel current and future grants.

U.S. District Judge Indira Talwani granted a summary judgment preventing the administration from relying on the clause to make cuts and denied a motion by the government to dismiss the case.

“Defendants’ interpretation of the Termination Clause is not clearly supported by the text of the provision, runs counter to the regulatory scheme, receives no support in the rulemaking history, and would violate the Spending Clause’s requirement that conditions be imposed unambiguously,” Talwani, who was nominated by Democratic President Barack Obama, wrote.

The lawsuit argued that the Office of Management and Budget promulgated the use of the clause in question to justify what it described as a “nationwide slash-and-burn campaign.”

The clause, which was first introduced in 2020 and revised in 2024, says federal agents can terminate a grant if the award “no longer effectuates the program goals or agency priorities.” The states argued that the language, put in place during the Biden administration, was for the first time being used to terminate grants.

“Instead of working with us to keep the public safe and lower costs for hardworking New Jerseyans, the Trump Administration has recklessly and illegally gutted federal funding for public safety, disaster preparedness, scientific research, clean water, and more,” New Jersey Attorney General Jennifer Davenport said in a statement.

“Today’s decision is an important win for all New Jerseyans and confirms that the Trump Administration defied the law when it embarked on its campaign to gut critical federal funding to the states,” she continued. “The President and his allies cannot hold critical programs hostage to their personal whims and political ideologies, destabilizing the country by yanking essential federal funding that was already awarded to the states.”

Calling the case an “extraordinarily unusual lawsuit,” lawyers for federal government argued it should be dismissed because some of those grants have already been terminated and plaintiffs’ argument about the impact to future grants was far too speculative. They also accused the states of “raising blanket, undifferentiated objections” to the termination of thousands of grants without seeking relief that would “restore a single grant.”

“That mismatch between the allegedly unlawful agency ‘decision’ on one hand, and the amorphous relief requested in this suit, on the other, creates a set of jurisdiction and justiciability defects that doom this lawsuit at the threshold,” lawyers wrote in the motion to dismiss.

A spokesperson for the Office of Management and Budget did not respond to a request for comment.

Please follow our Community Guidelines

National News

California Gov. Gavin Newsom pauses while discussing environmental issues in San Francisco, Tuesday...

Associated Press

California Gov. Gavin Newsom signs laws to protect workers from AI risks

SACRAMENTO, Calif. (AP) — California Gov. Gavin Newsom signed laws Wednesday aimed at protecting workers from the threats of artificial intelligence, including potential job losses and workplace surveillance. He also signed an executive order to require state agencies to continue to refer to the technology as “artificial intelligence” instead of the term “ super intelligence […]

9 minutes ago

FILE - Democratic Ohio Senate candidate Sherrod Brown, a former three-term U.S. senator, speaks at ...

Associated Press

3 GOP states go to US Supreme Court to challenge 3 Democratic-led states’ abortion ‘shield’ laws

Three Republican states went to the U.S. Supreme Court on Wednesday to challenge abortion “shield laws” protecting providers in three Democratic states, escalating the legal conflict over pills that account for a majority of abortions. The attorneys general of Alabama, Arkansas and Louisiana contend that the laws in California, Massachusetts and New York undermine their […]

17 minutes ago

Sen. Bernie Moreno, R-Ohio, talks to reporters outside the chamber at the Capitol in Washington, We...

Associated Press

Senate punts bill to permanently ban Chinese cars until after midterm elections

WASHINGTON (AP) — Legislation to permanently ban the sale of Chinese vehicles in the United States stalled out on Wednesday as senators struggled to seal an agreement, virtually guaranteeing that the bill will have to wait until after the November elections. The bipartisan bill, sponsored by Republican Sen. Bernie Moreno of Ohio and Democratic Sen. […]

38 minutes ago

California gubernatorial candidate Xavier Becerra speaks at a news conference on California's housi...

Associated Press

Rivals for California governor to meet in only scheduled debate as mail ballots go to voters

LOS ANGELES (AP) — The candidates for California governor will meet face to face Tuesday in the only scheduled debate of the campaign, giving Republican Steve Hilton perhaps his best chance of gaining ground on Democrat Xavier Becerra. The hourlong matchup on CNN comes just days before mail ballots are expected to begin arriving at […]

53 minutes ago

A customer checks gas price while he fills up his vehicle's tank at a gas station in Racine, Wis., ...

Associated Press

High gas prices are spurring states to waive taxes and regulations amid midterm election

COLUMBUS, Ohio (AP) — State officials nationwide are focusing on rising gas and diesel prices tied to the war in Iran, offering gas tax holidays and other measures to ease costs as affordability remains a top voter concern in the critical midterm elections. The high gas prices took center stage in Ohio on Wednesday, as […]

1 hour ago

The U.S. Immigration and Customs Enforcement website used to locate someone in immigration detentio...

Associated Press

Human rights groups ask UN panel to help end ICE’s effort to hide locations of detainees

Human rights advocates asked a United Nations panel to intervene Wednesday to help end a new U.S. government practice of withholding from families and lawyers the whereabouts of thousands of detainees facing deportation. U.S. Immigration and Customs Enforcement removed the names of detainees with final removal orders from its who are in ICE custody. The […]

3 hours ago

Federal judge bars Trump administration from using obscure clause to make huge funding cuts