Nonprofits Win Injunction To Release Frozen Federal Funds

Court Decision Might Make Fundraising Law Moot

A preliminary injunction against the Trump administration’s freeze on billions in congressionally approved infrastructure and environmental funding for communities across the nation was granted in the United States District Court For The District of Rhode Island.

The court’s ruling, which secures the largest release of this critical funding to date, will allow community projects across the country to resume without further delay, according to Democracy Forward, which represents Woonasquatucket River Watershed Council, National Council of Nonprofits, Eastern Rhode Island Conservation District, Childhood Lead Action Project, Codman Square Neighborhood Development Corporation, and Green Infrastructure Center in this case.

The plaintiffs filed a motion for a preliminary injunction last month asking the court to immediately lift the Trump administration’s freeze on billions in congressionally approved funds under the Inflation Reduction Act (IRA) and the Infrastructure Investment and Jobs Act, otherwise known as the Bipartisan Infrastructure Law (BIL). Congress passed these laws to support infrastructure improvements, climate initiatives, and public health protections.

“We are pleased that a federal court has seen the Trump administration’s freeze of congressionally approved funds for what it is: another abuse of executive power that has already inflicted harm on communities nationwide,” Skye Perryman, president and CEO of Democracy Forward said via a statement. “By blocking these investments in local communities and projects, the administration is jeopardizing public health initiatives, environmental protections, and economic stability. Today’s ruling marks a crucial victory for the rule of law and ensures these vital resources will flow to the people and projects Congress intended to support.”

The decision to grant a preliminary injunction in the Woonasquatucket River Watershed Council v. Department of Agriculture lawsuit “marks a critical victory for organizations that work tirelessly to improve our communities. It is a significant and promising step toward releasing Congressionally-approved and awarded funds appropriated under the Inflation Reduction Act of 2022 and the Infrastructure Investment and Jobs Act of 2021, said Diane Yentel, president and CEO of the National Council of Nonprofits.

When the National Council of Nonprofits joined the lawsuit against the administration, our goal was clear: to challenge an unlawful and arbitrary freeze of funds that threatened critical on-the-ground services, said Yentel.

President Donald J. Trump’s “Unleashing American Energy” executive order directed federal agencies, including the Environmental Protection Agency and the Departments of Agriculture, Energy, the Interior, and Housing and Urban Development, to halt the distribution of funds appropriated under the IRA and BIL.

The motion was filed as part of the lawsuit brought on March 13, 2025, by Democracy Forward and co-counsel DeLuca, Weizenbaum, Barry & Revens, challenging the administration’s unlawful suspension of funding, arguing that the freeze violates the Administrative Procedure Act, disrupting vital community-led projects, putting jobs, public health initiatives, and climate resilience efforts in jeopardy.

This is the second nationwide preliminary injunction currently in place from lawsuits brought by National Council of Nonprofits and partners. We will continue standing up for the vital work of nonprofit organizations, and for the people and communities they serve.

Yentel said that she expects the funds to be made available. “The administration has adhered to the preliminary injunction in NCN vs OMB,” said Yentel. In that case, every declarant with previously frozen funds had them made available to them after the PI was granted, “and those funds have remained available since. We expect the administration to again follow court orders and adhere to the PI in this case as well,” said Yentel.

The lawsuit can be found here https://democracyforward.org/wp-content/uploads/2025/03/IRA-IIJA-Compl.pdf