Trump’s Halt on Climate Spending Freezes Jobs and Stalls Projects
When marble-size hail fell on Alabama in 2023, it devastated Camp Hill, a town of 1,000 where nearly half the residents live below the poverty line. Decks were demolished, cars shattered, roofs destroyed, and few people had insurance.
The community was expecting to get help this month in the form of a $20 million federal grant to help homeowners make repairs — money that came from a Biden-era law to tackle climate change.
But those funds have now been held up by President Trump’s order that all federal climate spending be paused. Even though the White House this week rescinded a sweeping directive that would have stopped trillions of dollars in grants across the federal government, a separate executive order is still in effect that halts tens of billions of dollars in energy and environmental spending.
That pause is paralyzing federal agencies, causing confusion in states and cities, delaying construction projects and forcing some companies to furlough workers.
“These are real human beings,” said Warren Tidwell, director of the Alabama Center for Rural Organizing and Systemic Solutions, which is leading the effort to repair Camp Hill’s many damaged, leaky roofs. “We have one woman in her 80s who lives alone, and if she does not get her roof fixed, well, we’re going to have a senior in her late 80s who is homeless,” Mr. Tidwell said.
The day he was sworn in, Mr. Trump issued an executive order on “Terminating the Green New Deal,” his catchall term for climate policies. The White House told federal agencies to pause and review all funding authorized by the Inflation Reduction Act and a bipartisan infrastructure law — two bills signed by former President Joseph R. Biden Jr. that invested hundreds of billions of dollars in wind and solar projects, electric vehicles and other low-carbon energy technologies.
Agencies like the Environmental Protection Agency and the Department of Energy complied by halting grants, loans and other spending.
The pause has affected a wide range of programs.
States have been blocked from receiving funds from a $7 billion program to help low-income communities install solar panels. School districts in Virginia, New York City and rural Nevada are unsure if the electric school buses they had signed contracts for will arrive. Ports in South Carolina and Tampa, Fla., had been awarded nearly $2 million apiece to clean up pollution, funds that now could be frozen. Battery companies that received federal grants to build factories don’t know when they might get paid.
White House officials declined to comment on the record.
Although the Inflation Reduction Act was passed by Democrats, 80 percent of the law’s investments so far have gone to Republican congressional districts. So far, however, many Republicans have refrained from criticizing the spending freeze. Democrats are pressing the agencies for answers and demanding a legal justification for the action.
“It’s been chaotic and confusing,” said Maren Mahoney, the director of the Arizona governor’s office of resiliency. The state received a $156 million grant last year through the E.P.A. to deploy 61 megawatts of solar energy throughout the state, with a focus on low-income and tribal communities.
Ms. Mahoney said she had been just about to make her first four hires when Mr. Trump was inaugurated and her group was unable to gain access to its money through the government’s automated system. Calls to the E.P.A. went unreturned, Ms. Mahoney said.
Jeff Landis, a spokesman at the E.P.A., said the agency was implementing Mr. Trump’s executive order.
This week in Washington State, a company called Zero Emissions Northwest, which helps rural communities secure federal grants to save energy costs, had to furlough three employees after the government halted reimbursements.
David Funk, the company’s president, said that the farmers and business owners he had been working with currently had $1.9 million in projects under construction after signing up for the Rural Energy for American Program. Participants often dip into their own savings or borrow money to do things like insulate their buildings, upgrade pizza ovens or install solar panels to offset irrigation costs. They then expect that the federal government will honor its promise to repay them for a portion of the costs.
But on Tuesday, when Mr. Funk went to submit invoices for his clients, the Department of Agriculture told him reimbursements had been paused. His clients are currently owed at least $250,000, he said.
“Farmers are losing money every day,” Mr. Funk said in an interview. He added that the program was “advancing the goals of the new administration — we are working on lowering operating costs, we are generating energy locally, and we are buying American products.”
It’s normal for a new administration to slow down agency actions briefly while it sets its priorities. “What is different is the scope and depth of these executive orders,” said Emily Hammond, a law professor at George Washington University who previously served as deputy general counsel for environment and litigation at the Energy Department.
For instance, an internal E.P.A. memo orders a halt to disbursing funds for which the government has already signed a contract to deliver the money. That means the government could be sued if it breaches its commitments.
On Friday, a federal judge ordered the Trump administration to stop blocking federal funding to 22 states for all congressionally authorized programs. It remained unclear if or when agencies might resume spending.
Under the Biden administration, the Department of Energy awarded tens of billions of dollars in grants and loans to companies that were upgrading transmission lines, building battery factories, reviving a shuttered nuclear plant and more. Some companies and contractors say that they began making investments with the expectation that they would be reimbursed but that they now don’t know when that will be.
Under Mr. Trump’s executive order, agencies have 90 days to review the paused spending, and it can move forward only after approval from key political officials. The White House says that doing so will ensure that all spending aligns with its policy priorities.
Critics say the result could be paralysis. “If that sounds insanely inefficient, that’s because it is,” said Ryan Fitzpatrick, senior director of domestic policy at Third Way, a center-left think tank. “That process could take months. We’re talking about thousands of contracts and hundreds of thousands of jobs delayed and possibly canceled.”
Some experts worried about the effects of prolonged uncertainty. Since the Inflation Reduction Act passed, companies have announced plans to invest more than $167 billion in U.S. factories to build solar panels, batteries, electric vehicles and other clean-energy technologies, according to data from Atlas Public Policy, a research firm. In addition to tax credits, some of those factories were awarded federal loans or grants.
“We’re in the middle of a very significant investment cycle,” said Mike Carr, executive director of the Solar Energy Manufacturers for America Coalition. “But there’s a risk of losing that momentum if uncertainty is introduced.”
Other federal climate grants go to poor or rural areas.
Representative Jennifer McClellan, Democrat of Virginia, said the Henrico County public school system was still waiting to hear whether a $1.3 million grant for electric school buses that the E.P.A. approved during the Biden administration would be honored.
And in central Illinois, a coalition of 13 rural school districts that won a $15 million Energy Department grant to install micro grids and buy at least one electric school bus is now worried that the districts won’t have the new equipment in place for another year, if ever.
“We’ve just kind of been ghosted,” said Tim Farquer, the superintendent of the Mercer County school district in Illinois, who is running the program.
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