Second Circuit scrutinizes $73 million DOT funding freeze over disputed immigrant CDL rule

The Second Circuit Court of Appeals questioned the federal government’s move to suspend more than $73 million in road-maintenance funding for New York, a penalty imposed by the Trump administration over a contested commercial driver’s-license (CDL) policy aimed at immigrant truck drivers. Justice Department civil-division attorney Simon Jerome told the court the statutory reading was “somewhat ambiguous” and not unequivocally clear.

New York Attorney General Letitia James sued, asserting the CDL holders had legal status, while Assistant Solicitor General Anthony Raduazo said the record contains no support for the government’s claim of “substantial noncompliance.” Transportation Secretary Sean Duffy had earlier accused the state of endangering safety by issuing CDLs without verifying legal status, prompting the funding block. Judges Alison Nathan, Sarah Merriam and Matthew Schwartz heard the arguments but have not issued a decision. Similar litigation is pending in the D.C. Circuit over California’s challenge, and Governor Kathy Hochul called the cuts “political payback” that jeopardize critical road projects.