States Sue DOT Over Withheld EV Charging Funds

Twenty-two states and the District of Columbia are suing the U.S. Department of Transportation (DOT) and the Federal Highway Administration (FHWA), alleging the agencies unlawfully withheld $2.7 billion in federal funds earmarked for EV charging infrastructure under the National Electric Vehicle Infrastructure (NEVI) Formula Program.

The lawsuit, filed August 1 in the U.S. District Court for the Western District of Washington, directly challenges Executive Order 14154, issued by former President Donald Trump in January 2025. The order directed agencies to pause spending on climate and clean energy programs authorized under the Infrastructure Investment and Jobs Act (IIJA) and Inflation Reduction Act (IRA).

“The President cannot eliminate congressional funding by executive fiat,” said Washington Attorney General Nicholas W. Brown, one of the lead plaintiffs.

At stake is more than just funding—it’s the ability of states to plan and implement long-term decarbonization strategies that rely on stable, predictable federal support.

Trump’s Justification: “A Waste of Taxpayer Dollars”

The Trump administration has defended the freeze by framing NEVI funding as fiscally irresponsible and inefficient. In public remarks and agency statements:

• The FHWA called the previous NEVI guidance “a disaster,” alleging it failed to deliver results.
• Trump himself described federal EV charger investments as “an incredible waste of taxpayer dollars,” claiming that American drivers do not want EVs and that the infrastructure is unnecessary.
• Executive Order 14154, titled “Unleashing American Energy,” ordered agencies to pause or cancel clean energy expenditures not explicitly required by statute.

However, a Government Accountability Office (GAO) decision and multiple legal experts have said the move violates the Impoundment Control Act—a federal law requiring the executive branch to spend funds appropriated by Congress unless Congress itself rescinds them.

States Detail “Severe Disruption” and Contractual Jeopardy

According to the amended complaint, the FHWA’s February 6, 2025 letter rescinded all previous approvals of state NEVI plans and invalidated every piece of guidance issued since 2022. States argue this abrupt action stranded billions in planned investments and upended competitive procurement processes already underway.

Among the most striking revelations:

• Colorado awarded nearly $33 million in contracts and entered into $18 million in legal agreements—but has received only $8 million from FHWA. State officials warn they may face breach-of-contract lawsuits from private partners if funding isn’t restored.
• New York committed $38 million and is now unable to proceed with any vendor payments or construction.
• Missouri, despite having $5 million in obligated NEVI funding, was told that obligation “was in error” and remains unusable—an unusual federal retraction that plaintiffs say lacks precedent.
• California’s Energy Commission says the funding freeze directly caused at least one awardee to withdraw from a previously approved NEVI round, with additional projects on hold.

“This legal maneuver threatens to derail years of bipartisan climate and infrastructure planning,” said California Attorney General Rob Bonta.

Equity and Emissions Targets at Risk

Beyond the dollar amounts, the lawsuit reveals a pattern of harm to environmental justice and frontline communities—many of which were prioritized in state EV charger siting plans.

• Washington’s application targeted underserved tribal and rural communities along major freight corridors.
• Nevada identified a 50% reduction in tailpipe emissions in frontline communities as a key metric under its NEVI plan.
• Oregon and Connecticut cite extensive community engagement efforts that are now moot due to stalled implementation.

“These are not abstract metrics,” the complaint reads. “They represent people—drivers, families, students—who live with the highest levels of air pollution and have the least access to clean mobility options.”

Constitutional and Administrative Law Questions

The lawsuit raises multiple legal arguments, including that the FHWA exceeded its statutory authority and failed to follow required procedures under the Administrative Procedure Act (APA). It also contends:

• The funding pause violates the constitutional separation of powers by overriding Congress’s power of the purse.
• The FHWA’s action lacked reasoned explanation and ignored reliance interests from state partners and contractors.
• The administration failed to account for binding obligations that states entered based on prior approvals—potentially exposing states to litigation and financial penalties.

The plaintiffs are seeking an injunction to immediately restore NEVI plan approvals and prevent future enforcement of Executive Order 14154 as it relates to NEVI.

Broader Implications for the Clean Energy Economy

This legal showdown is the most prominent to date in a growing number of state challenges to federal rollbacks of IRA and IIJA implementation. It underscores the vulnerability of climate and clean energy programs to administrative reinterpretation—even after funding is appropriated and disbursed.

Should the court side with the plaintiffs, the decision could reset how executive agencies manage congressionally approved programs and may limit a president’s ability to unilaterally block climate-related investments.

“This case is about more than charging stations,” said Colorado Attorney General Phil Weiser. “It’s about whether one branch of government can erase the work of another.”