PHOENIX, Ariz. — Arizona Attorney General Kris Mayes has joined 20 other state attorneys general in a lawsuit challenging what they call the Trump Administration’s unlawful and sweeping effort to revoke billions of dollars in federal funding granted to states.
The coalition argues the administration is abusing a little-known clause in federal regulations — stating grants may be canceled if they “no longer effectuate … agency priorities” — to eliminate critical funding for programs that support education, infrastructure, public health, economic recovery, clean water, scientific research, and more.
Since January 20, federal agencies have been terminating grants at the direction of President Trump and the Department of Government Efficiency (DOGE), often without advance notice. The lawsuit contends that this practice represents a sharp break from past administrations, which honored grant agreements even as agency priorities evolved.
In Arizona alone, programs have already been affected:
Three U.S. Department of Labor ARPA grants to Arizona’s Department of Economic Security were canceled in May, resulting in about 500 layoffs.
Over $8 million in EPA grants to the University of Arizona and Arizona Board of Regents were revoked.
A federal grant to the Arizona Hispanic Chamber of Commerce was terminated, disrupting operations at the state’s MBDA Business Center.
“These reckless terminations are not only devastating but also unlawful,” said Mayes. “Arizona families and communities are being hurt by this administration’s arbitrary decisions, and we’re going to court to stop it.”
The lawsuit, filed in federal court in Massachusetts, names the Office of Management and Budget (OMB) and 11 federal agencies, including the Departments of Justice, Commerce, Labor, Agriculture, and the Environmental Protection Agency. It seeks a declaratory judgment that these agencies do not have the authority to cancel funding based on changing priorities after grants have already been awarded. The coalition is also asking the court to invalidate the administration’s decisions to terminate these grants.
The legal challenge comes in response to a February executive order from President Trump directing agencies to broadly cancel existing grants. The attorneys general argue that this undermines Congressional authority over federal appropriations and leaves states unable to plan for essential programs.
Arizona joins states like New York, California, Illinois, and Massachusetts in the suit. Together, they represent billions of dollars in funding and services at risk.
