WASHINGTON, D.C—The legal battle over a Biden-era climate fund program ramped up late Wednesday when an appeals court halted a federal judge’s ruling requiring the disbursement of those funds.
The ruling by a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit will keep funds frozen in Citibank accounts while a federal suit over the program is ongoing.
The appeals court order reversed a preliminary injunction that U.S. District Judge Tanya Chutkan of the District of Columbia issued Tuesday that temporarily barred the U.S. Environmental Protection Agency from “unlawfully suspending or terminating” grant awards.
The appeals panel said it had not had access to Chutkan’s opinion explaining her order granting an injunction — which came a day after the order itself — and the trial judge had therefore not met the high bar needed to issue a preliminary injunction. The panel’s order “should not be construed in any way as a ruling on the merits,” the judges said.
“The purpose of this order is to give the court sufficient opportunity to consider the district court’s forthcoming opinion in support of its order granting a preliminary injunction together with” the government’s appeal, the judges wrote.
Chutkan issued her opinion the day after granting the preliminary injunction, pointing out that “for weeks, despite repeated inquiries to Citibank and EPA, Plaintiffs received little to no communication from EPA or Citibank regarding their inability to access their funds.”
“Overnight, billions of dollars appropriated by Congress were frozen. As a result, nationwide projects were halted, workplans were disrupted, and millions of dollars in approved transactions with committed partners could not be disbursed,” she wrote.
On Thursday, the D.C. Circuit panel asked the government to refile its argument responding to Chutkan’s opinion by 5 p.m. Eastern on Saturday.
Fight over funding
Climate United Fund and other organizations sued President Donald Trump’s administration and Citibank in March over money frozen in the Greenhouse Gas Reduction Fund.
The $27 billion initiative, which provides funding to organizations building for energy-efficient projects and other measures to tackle climate change, was authorized by Congress as part of the Inflation Reduction Act that Democrats passed along party lines and President Joe Biden signed into law in 2022.
Chutkan’s order blocked the administration from “directly or indirectly impeding” Citibank or causing the bank to “deny, obstruct, delay, or otherwise limit access to funds in accounts established in connection with” the organizations’ grants.
The Trump administration quickly challenged that ruling Wednesday in the U.S. Court of Appeals for the District of Columbia Circuit.
The higher court temporarily blocked Chutkan’s decision “pending further order.”
The appeals court’s ruling halts Chutkan’s preliminary injunction to the extent that it “enables or requires Citibank to release, disburse, transfer, otherwise move, or allow access to funds.”
The higher court also prevented the Trump administration from having to file a status report with the district court within 24 hours of the preliminary injunction’s entry that confirmed their compliance, as outlined in Chutkan’s ruling.
The appeals court also ordered that “no party take any action, directly or indirectly, with regard to the disputed contracts, grants, awards or funds.”
The EPA said in March it would be terminating $20 billion in grants under the program, and the agency’s administrator Lee Zeldin described the climate initiative as a “gold bar” scheme.
Climate United Fund did not immediately respond to a request for comment Thursday, and the EPA declined to comment.
Allegations of hidden climate funds
On February 12, 2025, EPA Administrator Lee Zeldin revealed in a video statement that the EPA secretly parked $20 billion in an outside financial institution—the first scheme of its kind in the agency’s history—designed by Biden administration officials to rush spending with reduced oversight.
The entire $20 billion was handed to just eight entities, which then distributed the funds to NGOs and other groups with little to no transparency. The eight entities are:
- Climate United Fund ($6.97 billion award)
- Coalition for Green Capital ($5 billion award)
- Power Forward Communities ($2 billion award)
- Opportunity Finance Network ($2.29 billion award)
- Inclusive ($1.87 billion award)
- Justice Climate Fund ($940 million award)
- Appalachian Community Capital ($500 million award)
- Native CDFI Network ($400 million award)
Zeldin directed the financial institution to immediately terminate the Financial Agent Agreement and return all of the $20 billion and referred the matter to Inspector General’s Office and DOJ.
First reported by Washington Free Beacon then by Environmental Protection Agency Director Lee Zeldin in a television interview, alleging $2 billion of the $20 billion in a money laundering “green” scheme has ties to former Georgia Gubernatorial Candidate and staunch Kamala Harris Presidential Campaign surrogate Stacey Abrams.
According to the Washington Free Beacon, DOGE discovered a $2 billion taxpayer grant for Power Forward Communities, a nonprofit, whose founding member, Ari Matusiak, hired Abrams in March 2023 as Senior Counsel to his other nonprofit Rewiring America.
Power Forward Communities has ties to Washington state municipalities and other businesses—later disclosed in this post.
Ari Matusiak is founder and co-chair of Power Forward Communities, a national coalition awarded $2 billion from the Greenhouse Gas Reduction Fund to decarbonize and reinvest in American households. From 2011 through 2014, he was special assistant to the president and director of private sector engagement in the Obama White House, according to his Bio and to his LinkedIn profile.
Abrams founded two companies during her gubernatorial run—Southern Economic Advancement Project and Fair Count—which are listed as partners on Power Forward Communities website.
According to IRS documents obtained by the Lynnwood Times, Power Forward Communities was awarded its nonprofit status in August 2023. The coalition that formed the nonprofit was led by Enterprise Community Partners, Rewiring America, Habitat for Humanity International, Local Initiatives Support Corporation (LISC), and United Way Worldwide and reported only $100 dollars in revenue on its IRS filing for that year.
“It’s extremely concerning that an organization that reported just $100 in revenue in 2023 was chosen to receive $2 billion [a year later],” EPA Administrator Lee Zeldin told the Washington Free Beacon. “That’s 20 million times the organization’s reported revenue.”
“I made a commitment to members of Congress and to the American people to be a good steward of tax dollars and I’ve wasted no time in keeping my word,” Zeldin said.
Enterprise Community Partners (one of the founding companies of Power Forward Communities) awarded Bothell United Methodist Church a cash grant of $30,687 towards its affordable housing goals in 2022.
On July 16, 2024, the City of Bothell entered a Letter of Intent with the Bothell United Methodist Church (BUMC) to gift the church, at no cost, a city-owned plot of land worth $6 million to be used for affordable housing and a community space. But conflict-of-interest concerns have since been raised involving one of BUMC’s lead pastors seeing as she made sizable financial contributions to the Mayor and City Council members who voted in favor of that decision.
Shoreline Area News reports that on January 21, the Bothell city council voted 5-2 to donate the $6 million vacant lot to Bothell United Methodist Church.
Washington state partners of Power Forward Communities listed on the nonprofit’s website: City of Kenmore, King County, Pierce County, Resilient Methow, Rural People’s Voice, City of Seattle, Tacoma, Washington State Housing Finance Commission, and Whatcom County.
SOURCE: This article was authored by Shauneen Miranda of the Washington State Standard part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. The Lynnwood Times added the section titled, “Allegations of hidden climate funds.”
Author: Washington State Standard
