Farmers, Nonprofits Sue Trump Administration for Freezing IRA Grant Funds

Today, Earthjustice sued the Trump administration for unlawfully withholding grant funds appropriated by Congress through the Inflation Reduction Act (IRA).  

The lawsuit, filed on behalf of nonprofits and small farmers, seeks a court order requiring the administration to fulfill its financial commitments, release the funds, and prevent further irreparable harm. 

The lawsuit argues the Trump administration and the U.S. Department of Agriculture (USDA) is unlawfully withholding funds in violation of the Constitution and the Administrative Procedure Act (APA). By refusing to disburse funds Congress allocated to specific grant programs and already promised to grant recipients, the administration violates the Constitution’s separation of powers. Its arbitrary and capricious actions taken without consideration for the harms they cause and without a reasoned explanation also violate the APA.

“The Trump administration’s unlawful actions are hurting communities across the country. This is not government efficiency. It is thoughtless waste that inflicts unwarranted financial pain on small farmers and organizations trying to improve their communities,” said Hana Vizcarra, senior attorney at Earthjustice. 

Earthjustice represents five farms in Maryland, Massachusetts, and Mississippi along with three nonprofit organizations who were awarded USDA grants funded by the Inflation Reduction Act. Farmers were awarded Rural Energy for America Program (REAP) grants to install solar panels on their farms and improve energy efficiency, measures that would greatly lower energy costs for the small businesses and enable them to pay higher wages to workers, invest in cover crops, and expand their businesses.  

“USDA grants exist for a reason. Without them, there wouldn’t be farmers,” said Laura Beth Resnick, sustainable farmer and owner of Butterbee Farm in Maryland. “We’re not able to save for retirement or invest in the farm until we pay back our loans. If our contracts with USDA are not honored, we’re going to have to make difficult cuts somewhere else that will cause us to struggle.” 

Faith in Place and GreenLatinos were awarded USDA Forest Service Urban and Community Forestry grants to support tree equity in historically underserved communities in Illinois, Indiana, Wisconsin and California. 

“Faith in Place carefully planned our Tree Canopy and Workforce Community grant to ensure critical funding reached the communities that need it most. We hired staff, built infrastructure and followed every federal requirement—fully expecting the government to uphold its commitment as we did ours,” said Rev. Brian Sauder, President and CEO of Faith in Place. “Now, the administration is not only abandoning our most vulnerable communities but also jeopardizing the very organizations that make crucial federal programs work on the ground. The federal government must honor its promises and serve the people, not corporate interests.”

“This government grant freeze is directly harming low-income and underserved communities that need increased tree canopies to tackle extreme heat and air pollution,” said Mark Magaña, Founding President and CEO of GreenLatinos. “GreenLatinos has worked hard to build trust with local leaders to ensure communities have the resources to fight and win their climate battles. Now, under the threat of permanently losing our promised USDA funding, we’ve had to pause work with subgrantees, missing the crucial spring planting season and putting their futures at risk. The freezing of funding will have a ripple effect for years to come.”

Cultivate KC was awarded an Increasing Land Access grant to provide bridge funding to farmers, purchase land to create an incubator farm for new farmers, and create a city-level position focused on food systems challenges. It also received a Conservation Technical Assistance grant to run technical workshops and create educational materials for Missouri’s underserved farmers. 

“Cultivate KC helped both local and national USDA staff to build trust with farmers and organizations that have historically been left out of funding opportunities, so this funding freeze is a slap in the face,” said Brien Darby, Executive Director of Cultivate KC. “The freeze is devastating to the farmers and organizations who have spent months and years carefully planning and implementing impactful projects, only to be left in limbo. It erodes the trust that the USDA worked so hard to build.”

The outcome of this lawsuit will have implications for the Trump administration across agencies that administer IRA grant funds.