President Donald Trump listens as Homeland Security Secretary Kristi Noem speaks during a tour of “Alligator Alcatraz,” a new migrant detention facility at Dade-Collier Training and Transition facility, Tuesday, July 1, 2025, in Ochopee, Fla. (AP Photo/Evan Vucci).
A federal judge barred the Trump administration on Wednesday from coercing states to enforce federal immigration priorities in exchange for disaster aid from the Federal Emergency Management Agency (FEMA).
In March and April, FEMA issued directives conditioning billions in federal grant funds on state cooperation with immigration enforcement in line with President Donald Trump”s anti-immigration agenda.
In May, 20 states, led by Illinois, filed a 79-page complaint, alleging the “grant funding hostage scheme” violates the U.S. Constitution’s spending clause as well as numerous aspects of the Administrative Procedure Act (APA), the federal statute governing agency behavior.
“By hanging a halt in this critical funding over States like a sword of Damocles, Defendants impose immense harm on States, forcing them to choose between readiness for disasters and emergencies, on the one hand, and their judgment about how best to investigate and prosecute crimes, on the other,” the lawsuit reads.
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Now, in a 45-page memorandum and order, U.S. District Judge William E. Smith, a George W. Bush appointee, put the kibosh on the Trump administration’s scheme for violating the law and Constitution.
“The Court finds that the contested conditions are arbitrary and capricious and thus invalid under the APA and are also a violation of the conditions attached to the Spending Clause and thus unconstitutional,” the order reads.
In ruling on dueling motions for summary judgment, the judge explained how the plaintiffs necessarily secured both a declaratory judgment in their favor and a concomitant vacatur of the new policy.
“Declaratory judgment states the law; when a court makes a declaratory judgment in the administrative law context, it declares the agency action unlawful,” Smith goes on. “Related, but different, when a court vacates agency action, it nullifies the action and removes its legal force. This remedial act available under the APA ensures that the unlawful agency action cannot bind the parties to the instant case, as well as all other entities affected. So, declaratory relief provides the legal determination, and vacatur is the logical consequence of that determination. They are two sides of the same coin.”
The court’s educational effort is not just for effect – Smith offers the explanation in service of the new legal regime in which district court judges found themselves after this summer’s landmark opinion from the U.S. Supreme Court in the case stylized as Trump v. Casa.
In that case, the conservative majority on the nation’s high court essentially ended the practice of nationwide or “universal” injunctions – at least those authored by district court judges.
“[B]ut the Court expressly left unaffected the APA’s command to ‘set aside’ unlawful agency action,” Smith notes. “It appears to this Court, then, that vacatur under the APA remains, for now, a valid remedy.”
Smith also entered a permanent injunction, for good measure, blocking the “economic dragooning” contemplated by the Trump administration against any of the plaintiff states.
Here, the court cuts to the heart of the matter with a lengthy citation from a famous Supreme Court case that allowed federal highway fund disbursement to be tied to raising the drinking age to 21.
“If, however, the conditions are akin to ‘economic dragooning that leaves the States with no real option but to acquiesce,’ they may be unduly coercive and invalid under the Constitution,” Smith writes.
The court explained why the states need the funds and the impact losing access would have.
“The record shows that states rely on these grants for billions of dollars annually in disaster relief and public safety funds that cannot be replaced by state revenues. Denying such funding if states refuse to comply with vague immigration requirements leaves them with no meaningful choice, particularly where state budgets are already committed,” the order continues. “The financial pressure here goes well beyond the ‘relatively mild encouragement’ approved in [the drinking age case.] The coercion is even more pronounced because the threatened funds involve essential public safety responsibilities rather than optional or peripheral programs.”
In a discussion about the constitutionality of the funding restrictions, the court determined that the government barely presented any connection like the one the Supreme Court allowed in the drinking age case.
Again, the ruling, at length:
[The Department of Homeland Security] justifies the conditions by pointing to its broad homeland security mission, but the grants at issue fund programs such as disaster relief, fire safety, dam safety, and emergency preparedness. Sweeping immigration-related conditions imposed on every DHS-administered grant, regardless of statutory purpose, lack the necessary tailoring. The Spending Clause requires that conditions be “reasonably calculated” to advance the purposes for which funds are expended, and DHS has failed to demonstrate any such connection outside of a few programs like Operation Stonegarden. The Court therefore concludes that the conditions are overbroad and unrelated to the underlying programs.
