Federal appeals court rules against Trump administration on New York highway funds
A federal appeals court ruled that the Trump administration overstepped its authority when it withheld $73.5 million in New York highway funds.
A federal appeals court ruled on Friday that the Trump administration overstepped its authority in April when it withheld $73.5 million in highway funding from New York over the state's refusal to revoke some commercial driver licenses issued to foreign drivers, according to reporting carried by Devdiscourse's Reuters US domestic news summary.
The US Transportation Department withheld the funding after an audit found New York had been routinely issuing commercial driver licenses to foreign drivers illegally.
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The decision arrives as the administration faces a separate legal test at the Supreme Court over its asylum restrictions at the US-Mexico border, which the justices agreed on Friday to consider. That policy, credited by the administration with helping reduce border crossings, was previously found by a lower court to exceed presidential authority by denying migrants caught entering the country illegally the chance to apply for asylum.
Together, the two rulings point to a widening judicial check on executive action. The Supreme Court last year restricted the ability of federal judges to block Trump administration actions nationwide, but left untouched a separate tool some judges have used to stymie presidential policies. The administration is now taking aim at that tool as well in another challenge to judicial authority that could further insulate its agenda against broad legal attacks.
| Item | Detail |
|---|---|
| Funding withheld | $73.5 million |
| State affected | New York |
| Month of withholding | April |
| Reason cited by USDOT | Audit found New York routinely issued commercial driver licenses to foreign drivers illegally |
| Court action | Federal appeals court ruled administration overstepped its authority |
| Related Supreme Court matter | Trump asylum restrictions at US-Mexico border agreed for review on Friday |
Beyond the courtroom, the administration's transportation agenda is under pressure from multiple directions. A massive, nearly five-hour shutdown of the US aviation system disrupted more than 20,000 flights from Friday into Saturday, with government officials saying the fault may have been a single router installed by government contractor L3Harris. The Federal Aviation Administration ordered a nationwide ground stop following what Transportation Secretary Sean Duffy described on X as "a communication issue impacting all Air Route Traffic Control Centers."
In the aftermath, the Trump administration boosted its request for air traffic control funding to $50 billion late Friday, up from an earlier request of $30.1 billion to upgrade the United States' aging airports and air traffic control system. The head of the FAA predicted that US air travel would not return to normal schedules until late Sunday. As of 4:15 pm ET on Saturday, airlines had canceled more than 5,300 US flights and delayed almost 6,300, according to FlightAware, following about 9,200 flights canceled and 7,500 delayed on Friday.
The New York highway funds dispute sits within a broader pattern of federal-state friction over licensing and immigration enforcement. A free speech nonprofit, FIRE, said on Friday the US government agreed to end efforts to press Apple and Facebook to restrict platforms created by two Americans reporting Immigration and Customs Enforcement activity. FIRE sued the federal departments of Justice and Homeland Security in February.
Meanwhile, early last month, ICE agents descended on Dodge City, Kansas, prompting community organizers to demand accountability from local officials. Kansas towns hit by the raids flipped to Democrats in recent elections, and residents are now pressing for answers about what local leaders knew and how the city would respond if it happened again.
On the political front, Democrat Cindy Holscher won the Kansas governor's race on a platform that included a moratorium for data-center development, beating Republican rival Ty Masterson despite backing for her opponent from the state's largest transit and railroad union and a local chapter of the IBEW electrical workers union. In Colorado, Republican Lauren Boebert lost her reelection bid to Democrat Eileen Laubacher, a retired US Navy rear admiral, in a district that Donald Trump had carried by 18 points in 2024.
Incoming House Speaker Hakeem Jeffries was heckled on Friday at a Democratic conference in Denver by protesters accusing him of being too timid to address the high cost of living that fueled voter frustration in the midterm elections. Jeffries is set to become US House Speaker when Democrats take control of Congress in January, after the party routed Trump's Republicans in the November 3 elections.
Health officials in Pennsylvania and Wisconsin reported measles-associated deaths on Friday as the worst outbreak in decades spreads across the US. Pennsylvania's seventh measles-linked death this year involved an unvaccinated Montour County resident. The state has recorded 1,542 cases in 46 counties as of Friday, including 305 hospitalizations. The Pan American Health Organization has revoked the United States' measles-elimination status, ending a 26-year run after determining the country failed to halt continuous transmission of the virus for more than a year, the Wall Street Journal reported on Friday.
In other federal personnel news, the White House denied on Friday that National Economic Council Director Kevin Hassett was leaving the Trump administration in the coming weeks. Earlier that day, Semafor reported, citing three people familiar with the plan, that Hassett was departing and had been inquiring about roles outside the administration since before the November 3 midterm elections, which resulted in Democrats retaking both chambers of Congress.
What to watch next
- Whether the USDOT complies with the appeals court ruling and releases the $73.5 million in highway funds to New York.
- Supreme Court proceedings on the administration's asylum restrictions at the US-Mexico border.
- The administration's challenge to the separate judicial tool used to block presidential policies.
- FAA and L3Harris findings on the router implicated in the nationwide aviation shutdown.
- Congressional action on the boosted $50 billion air traffic control funding request.
The appeals court decision on New York highway funds marks one of several legal setbacks confronting the administration as it pursues an aggressive agenda on immigration, transportation, and federal spending. With Democrats set to take control of Congress in January and the Supreme Court poised to weigh in on border policy, the coming months will test how far executive authority can stretch under judicial review.
