Written by Michael Phillips
Washington (AP) Federal authorities argued in a court filing that the Trump administration should be permitted to suspend its funding and terminate associated contracts with NGOs since the sweeping tax and policy bill that passed Congress repeals a multibillion-dollar green bank for supporting climate-friendly initiatives.
Nonprofit organizations such as the Climate United Fund March filed a lawsuit against Citibank, which held the program’s funds, the Environmental Protection Agency, and Lee Zeldin, its administrator. According to the case, the defendants unlawfully prevented the organizations from receiving billions of dollars that were granted through the Greenhouse Gas Reduction Fund, sometimes known as a “green bank,” last year. The Inflation Reduction Act of 2022 established the program.
However, the bill that cleared Congress on Thursday would revoke funds that had not yet been disbursed to the recipients and remove the portion of the 2022 law that created the green bank.
According to the EPA, the law should give them a win in their legal battle, which is currently being heard by a federal appeals court in Washington. An earlier federal judge’s ruling requiring the EPA to transfer funds to the nonprofits should be overturned now that Congress has revoked funding, the agency stated in its court filing on Thursday.
The Climate United Fund is not in agreement. Although it admits that the bill in Congress represents a major policy setback, it contends that the majority of the funds have already been distributed and are not impacted by the law. Additionally, EPA would have to go through a different procedure if it wanted to get the money back.
Our money has already been committed to and paid out. CEO Beth Bafford said in a statement that any attempt to argue differently is only a falsehood to support unlawful attempts to reclaim money meant to help communities all throughout the nation.
The EPA claims that the money were no longer obligated when the agency ended the programs.
In a desperate attempt to keep tens of billions of public cash hostage, grantees have engaged in legal gymnastics. According to a statement from EPA spokesman Brigit Hirsch, Congress made it quite evident that they intended to completely terminate the program and return the billions of dollars in unobligated monies to the U.S. Treasury when the One Big Beautiful Bill was passed.
The objectives of the green bank contradict the Trump administration’s support for fossil fuels and resistance to climate change policies. Zeldin swiftly turned the bank into a target, calling the $20 billion in grants a scam tainted by possible fraud and conflicts of interest.
Zeldin told Fox News in February that he believed the Green Bank was a blatant example of waste and misuse, which is, in my opinion, illegal. Zeldin discontinued the awards the next month.
Tanya Chutkan, a U.S. District Judge, has previously stated that the federal government changed its stance and failed to produce evidence of fraud when asked for it. Chutkan determined that part of the groups’ frozen funds should be made available to them and that the government cannot end the contracts.
The EPA’s appeal resulted in the suspension of that directive.
In what it perceives to be a straightforward contract dispute, the agency claims the NGOs are bringing up constitutional and legislative grounds that are irrelevant.
The EPA says the lawsuit should be reviewed by a separate court that may only grant a flat sum and not compel the government to maintain the subsidies in place if the government is successful in arguing that it is a contract issue. According to federal officials, the EPA is not required by law or the Constitution to provide these subsidies to these organizations.
The EPA also cited remarks made by Senate Committee on Environment and Public Works head and Republican Senator Shelley Moore Capito of West Virginia as bolstering the agency’s stance in its court brief. According to Capito, the bill’s original goal was to lift the freeze on billions of dollars in financing.
According to the agency, the senator states that this decision demonstrates not only Congress’s strong concern about lowering the deficit but also EPA’s management of the (green bank) during the Biden administration, the agency’s choice of award recipients, and the lack of effective program oversight.
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