Gov. Josh Shapiro sues Trump administration over federal funding freeze, alleging Pennsylvania hasn’t received $2 billion

HARRISBURG — Gov. Josh Shapiro took the rare step Thursday of suing President Donald Trump’s administration over its alleged failure to disburse more than $2 billion in federal funds to Pennsylvania, calling the move illegal and unconstitutional in the wake of a federal court ordering the White House to restore the funding.

Shapiro, a Democrat and former state attorney general, filed the federal suit in his official capacity as governor of Pennsylvania — an action typically taken by the state’s top prosecutor. But Republican Attorney General Dave Sunday declined to take legal action regarding the funding freeze, instead delegating matters to Shapiro, who sued after weeks of working with Pennsylvania’s congressional delegation in Washington to try to restore the funds.

The lawsuit comes after Trump’s administration issued and then rescinded a temporary pause on federal financial assistance last month, sending state and local officials into a panic. Despite federal courts ordering the Trump administration to restore federal funds, state governments and nonprofits have reported they are still unable to access some federal grants that Congress had allocated.

“While multiple federal judges have ordered the Trump administration to unfreeze this funding, access has not been restored, leaving my administration with no choice but to pursue legal action to protect the interests of the commonwealth and its residents,” Shapiro said in a news release announcing the suit.

In the suit, Shapiro alleges that Pennsylvania has not been able to draw from several federal grant-funded programs in recent weeks, including projects to reclaim former mine lands, to plug abandoned wells, and to provide funding for energy-efficient projects for low-income families to reduce their utility bills.

The federal government has also restricted Pennsylvania’s access to $3.1 billion in funds obligated to the state for fiscal years 2022 to 2026, Shapiro asserts in the lawsuit, filed in U.S. District Court for the Eastern District of Pennsylvania. That includes $1.2 billion in congressionally appropriated funds the state was expecting to receive, and $900 million that is on hold during an undefined review process, the lawsuit says.

Approximately 40% of Pennsylvania’s annual spending comes from the federal government. Pennsylvania is already projected to spend more than it collects in revenue this year, with a budget shortfall of $4.5 billion, meaning that any cuts to federal funding would deepen that deficit.

Shapiro said Trump’s administration is breaking its contract with Pennsylvania by failing to release federal funds to the state, “and it’s my job as governor to protect Pennsylvania’s interests.”

Harrison Fields, a White House deputy press secretary, said in a statement that the Trump administration is ready to face Shapiro and other Democrats challenging Trump’s work in court.

“Radical Leftists can either choose to swim against the tide and reject the overwhelming will of the people, or they can get on board and work with President Trump to advance his wildly popular agenda,” Fields added.

Shapiro, who served as Pennsylvania’s attorney general during Trump’s first term before he was sworn in as governor in 2023, is no stranger to suing Trump, and often joined other Democratic attorneys general in taking legal action against the first administration. Since Trump took office again in January, Democratic attorneys general, including New Jersey Attorney General Matthew Platkin, have similarly stepped in to sue over the administration’s many executive actions that they see as unconstitutional.

But Pennsylvania has notably stayed out of those lawsuits, with a new GOP attorney general who has a conservative view of the office and a chief priority of enforcing state laws.

Sunday, Pennsylvania’s Republican attorney general, who was sworn in last month, said in a statement that Shapiro requested that the attorney general’s office delegate the case to the governor after Sunday did not sue, as is allowed under state law. Sunday said his office granted the request because of Shapiro’s familiarity with the state agencies that have not received the disputed funds.

“My office is taking a deliberate and calculated approach in response to recent federal orders and actions,” Sunday added. “I am a firm believer in the Rule of Law, and that these matters will be resolved by the courts and that Pennsylvania will be incorporated in those court proceedings.”

Shapiro previously vowed to work with Trump but promised to challenge any efforts to infringe on residents’ rights. And his decision to step over Sunday to sue the Trump administration marks a significant development in how Shapiro will navigate a second Trump term.

While some Democrats, including Philadelphia State Sens. Vince Hughes and Christine Tartaglione, praised Shapiro’s suit, at least one Republican member of Pennsylvania’s congressional delegation criticized the move.

“The Trump administration’s funding pause is entirely legal and an absolutely necessary action to ensure taxpayer dollars serve America’s real priorities — not the left’s extreme agenda,” said U.S. Rep. Dan Meuser (R., Pa.), who told The Inquirer in December he was considering running for governor in 2026.

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Shapiro did not sue Trump himself. Rather, the lawsuit names several secretaries of agencies that he alleges have failed to release funds to Pennsylvania, including the Environmental Protection Agency and the Department of Energy. The lawsuit also names Russell Vought, an architect of the controversial Project 2025 and the new secretary of the Office of Management and Budget, which originally issued the White House’s now-rescinded memorandum to freeze federal funds until they are reviewed to be in line with certain executive orders.

Shapiro is asking for a judge to rule that the Trump administration’s failure to release federal funds to the state is unconstitutional, to block the administration from doing so again, and to cover the state’s attorneys’ fees.