Washington state wins challenge against FEMA's termination of Shelters and Services Program

(CN) — A federal judge on Tuesday agreed with the state of Washington that the U.S. Department of Homeland Security had bent the rules when it terminated funding for a Federal Emergency Management Agency program that helps state and local governments provide shelter and services to immigrants and asylum seekers released from DHS custody.

Senior U.S. District Judge Barbara Rothstein granted summary judgment to Washington on its claim Homeland Security violated the Administrative Procedure Act when it cut funding Congress had previously appropriated for the Shelters and Services Program.

The judge, a Jimmy Carter appointee, rejected the Trump administration’s argument that the lawsuit — relating to the $4 million FEMA had awarded to the state in 2024 — was, in essence, a contract dispute over which she has no jurisdiction and should have been brought in the Court of Federal Claims.

“The question is whether Washington asks this court to determine entitlement to money or to order defendants to pay,” Rothstein wrote. “It does not. Washington seeks to remove an allegedly unlawful agency barrier that prevents it from participating in a congressionally funded program and submitting reimbursement requests for agency review.”

New York, Chicago and other cities and counties last year brought similar challenges to Homeland Security’s cancellation of the program that dates back to 2019 and was meant to provide funds to help non-federal entities pay for humanitarian aid, including meals, lodging and acute medical care items, for noncitizens released from DHS custody.

FEMA terminated the program per one of President Donald Trump’s executive orders issued on his first day of his second term entitled “Protecting the American People Against Invasion.”

According to FEMA, funding non-federal entities to provide shelter and other services to individuals released from DHS short-term holding facilities wasn’t consistent with Homeland Security’s current priorities, because such individuals “often have no legal status and are in the United States unlawfully.”

However, Rothstein said Homeland Security’s rationale conflicted with the purpose for which Congress appropriated the funds.

“Congress chose to support sheltering and related activities by non-federal entities as a means of relieving overcrowding in CBP facilities,” she said referring to the U.S. Customs and Border Protection agency. “Defendants may disagree with that policy choice, but they may not invoke a change in executive branch priorities to nullify Congress’s funding judgment.”

In addition, the judge said, the decision to terminate funding was arbitrary and capricious in so far as Homeland Security provided no reasonable explanation why the same sheltering and related services that Congress funded, and that FEMA previously identified as serving the program’s statutory purpose, suddenly ceased to effectuate the those goals.

The judge vacated the decision to terminate the funding only in so far as it pertains to Washington. She ordered FEMA to consider the state’s reimbursement requests under the program but stopped short of ordering the agency to approve or pay any specific reimbursement request.

“Shelter and service providers play a much-needed role in helping new members of our community meet their basic needs such as shelter, food, and access to medical care,” Mike Faulk, a spokesperson for the Washington State Attorney General’s Office, said in an email. “The court correctly found the federal government’s decision to terminate Washington’s Shelter and Services Program grant award unlawful.”

Representatives of the U.S. Justice Department, which represents Homeland Security in the litigation, did not immediately respond to a request for comment after regular business hours.

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