Trump Freezes $5 Billion in Clean-Energy Funds in New York

New Yorkers — including residents of co-ops and condos — could lose out on nearly $2 billion in promised federal grants for environmental and clean-energy projects if President Donald Trump continues to withhold payments from the 2022 Inflation Reduction Act, according to a report by state Comptroller Tom DiNapoli, Crain's reports.

DiNapoli's report also found that New York taxpayers could miss out on $3.4 billion in tax credits they are currently set to receive through 2032, which apply to climate-friendly purchases such as electric vehicles. 

Not content with the freezing of grants and tax credits via executive order, Trump's Environmental Protection Agency administrator, Lee Zeldin, has sought to claw back $20 billion of the program’s total $27 billion from Citibank, which was tasked with disbursing the funds, while the Justice Department and FBI have launched a criminal investigation into the grant program, alleging that that the awarding of grants was, in Zeldin's words, "a rush job with reduced oversight."

But no evidence has emerged of any illegal activity in connection with the funds, and a detailed review by The Washington Post shows that the Trump administration has made several false or misleading claims about the program. The Post interviewed more than a dozen Biden administration officials, grant recipients and outside experts. The Post also reviewed hundreds of pages of documents, including grant applications, ethics agreements, legal filings and meeting minutes.

Despite the lack of evidence of any wrongdoing, the Trump administration's actions have put funding at risk in New York, including $250 million for the state’s Solar for All program, which helps low-income utility customers subscribe to solar projects and get credits on their energy bills, and $159 million to rebate homeowners on energy retrofits.

The Inflation Reduction Act’s tax credits, meanwhile, have already begun to benefit New York residents. Some 190,000 state taxpayers claimed a total of $374 million in 2023 from two tax credits that incentivize clean energy equipment and efficiency upgrades.

Republican lawmakers are discussing a repeal of the tax credits in order to help pay for the tax-cut law now working its way through Congress. If it echoes the Tax Cuts and Jobs Act during the first Trump administration, the impending law will largely benefit corporations and the wealthiest Americans while punishing taxpayers in high-tax blue states, including New York. But a complete rollback of the Inflation Reduction Act is no sure thing, given that much of the spending and tax credits benefit Republican-held Congressional districts. Politico reports that 21 House Republicans urged their own party’s leaders to preserve the law’s clean energy credits.

The Trump administration is unswayed. White House spokeswoman Taylor Rogers said in an email that Zeldin “is doing a wonderful job of saving billions of taxpayer dollars by eliminating unnecessary federal spending.”