City of Fresno Joins Lawsuit Seeking Halt to Federal Grant Conditions

The City of Fresno joined other cities and counties in filing suit to block newly announced federal conditions on grant programs, the City Council voted 6-0 to join the complaint at a Thursday meeting where Council Vice President Nelson Esparza was absent, City Attorney Andrew Janz announced. The complaint seeks a temporary restraining order to halt enforcement of executive orders and agency conditions that plaintiffs say could trigger withholding of Community Development Block Grant funds and other federal awards.

CourthouseNews and other reports name the U.S. Department of Housing and Urban Development and the Department of Transportation among agencies imposing the conditions, with additional mentions across sources of HHS, EPA, DHS, DOJ and the Department of the Interior. The complaint alleges agencies are requiring recipients to certify they do not operate any DEI programs, do not "promote" "gender ideology" or "elective abortion," will cooperate with federal immigration enforcement, and accept liability under the False Claims Act. CourthouseNews specifically cites Executive Order 14168 as defining "gender ideology" that agencies used as a basis for certification demands.

Fresno leaders say the legal fight is about protecting critical local funding. KMPH reported Fresno receives about $11.7 million a year in HUD funding and more than $100 million from DOT for transportation projects, including $50 million earmarked for airport improvements. Attorney Jonathan Holtzman, representing the coalition, said, "We didn't choose this path. But we cannot let our communities lose the resources they need for safe roads, reliable transit, and affordable housing."

Fresno Mayor Jerry Dyer was quoted saying, "Fresno is one of the fastest-growing cities in California. Our city depends on these federal grants to meet housing demand, provide reliable transportation, and improve our roads." ABC30 also reported Dyer added, "When Washington suddenly rewrites the rules, it's our families, seniors, and small businesses who suffer most." Council President Mike Karbassi framed the suit around taxpayer fairness, saying, "Local taxpayers have paid into the federal government, and we deserve the funding Congress approved. Without federal support, both our airport and the local economy it supports would be at risk." City Attorney Andrew Janz said the lawsuit "isn't about politics, but about keeping funding Congress intended for local communities."

Plaintiffs include a coalition described by CourthouseNews as led by Fresno, with other local governments named across sources including Eureka, South Lake Tahoe, Sacramento County, Santa Clara, Stockton, San Diego County, Los Angeles County and Beaverton, Oregon. GVWire reported the complaint states the conditions "appear to require federal grant recipients to agree to promote the political agenda President Trump campaigned on during his run for office and has continued espousing since."

CourthouseNews says the suit was filed in the U.S. District Court for the Eastern District of California and that U.S. District Judge Richard Seeborg found the coalition likely to succeed on some claims, issuing a temporary order; Judge Seeborg wrote, "In the context of a dynamic situation, the temporary order seeks to preserve the status quo and protect the power of the legislative branch." Reports conflict on filing dates, with one account saying the coalition sued on Aug. 20 and other outlets tying related events to an Aug. 18 HUD email that questioned Fresno's CDBG certification and demanded removal of words including "equity," "environmental justice" and references to "transgender" or affirmation it would not promote "gender ideology" under threat of withheld funds.

The immediate effect for Fresno is preservation of current funding flows while the court considers the coalition's claims that agencies exceeded statutory authority by conditioning grants; the case will determine whether millions in HUD and DOT funding for housing, roads, transit and airport projects can be contingent on the contested certifications.