Judge says USDOT can’t withhold funding from states for failure to comply with immigration enforcement

This week, a federal court ruled that the U.S. Department of Transportation (USDOT) overstepped in requiring states to cooperate in the enforcement of federal immigration law in order to receive transportation grant funding.

In a November 4 ruling issued by the U.S. District Court for the District of Rhode Island, Judge John McConnell ruled in favor of twenty states that sued USDOT, as well as Transportation Secretary Sean Duffy, for requiring that they comply with federal civil immigration enforcement in order to receive grant funding.

“Duffy Directive” Told States To Cooperate With Feds On Immigration Or Face Funding Loss

The complaint centered on the “Duffy Directive” issued on April 24, 2025, which told states that they had an obligation to cooperate with U.S. Immigration Customers Enforcement (ICE) and the Department of Homeland Security in the enforcement of federal immigration law, and that failing to comply “will jeopardize your continued receipt of Federal financial assistance from DOT and could lead to a loss of Federal funding from DOT.”

From the Duffy Directive:

“DOT has noted reported instances where some recipients of Federal financial assistance have declined to cooperate with ICE investigations, have issued driver’s licenses to individuals present in the United States in violation of Federal immigration law, or have otherwise acted in a manner that impedes Federal law enforcement. Such actions undermine Federal sovereignty in the enforcement of immigration law, compromise the safety and security of the transportation systems supported by DOT financial assistance, and prioritize illegal aliens over the safety and welfare of the American people whose Federal taxes fund DOT’s financial assistant programs.”

Lawsuit: USDOT Lacked Authority To Withhold Transportation Grants

The lawsuit filed in May argued the Duffy and USDOT lacked the statutory authority to withhold the funding, and that withholding transportation funding was “arbitrary and capricious.”

The judge ultimately ruled that USDOT’s actions violated the Administrative Procedure Act (APA) and the Constitution’s Spending Clause, and that “Federal law does not require unbridled state cooperation with federal civil immigration enforcement.”

“The Court has determined that Congress could not have intended to vest DOT with the authority to impose such sweeping immigration-related conditions on federal transportation funding. It was as such impermissible for Defendants to consider factors related to State cooperation with federal civil immigration enforcement in determining conditions for federal transportation funding,” Judge McConnell wrote.

“Defendants have blatantly overstepped their statutory authority, violated the APA, and transgressed well-settled constitutional limitations on federal funding conditions. The Constitution demands the Court set aside this lawless behavior,” McConnell concluded.

The states that brought the suit against USDOT and Duffy include California, Illinois, New Jersey, Rhode Island, Maryland, Colorado, Connecticut, Delaware, Hawaii, Maine, Massachusetts, Michigan, Minnesota, Nevada, New Mexico, New York, Oregon, Vermont, Washington, and Wisconsin.