Judge Halts Cuts to Public Health Grants, Cites Blue State Risks

A federal judge is blocking the Trump administration from cutting off public health funding to Democratic-led states, calling the harm from the effort “irreparable and intangible.”

“The loss of capacity to fund and maintain public health infrastructure puts the health of plaintiffs’ residents in jeopardy,” Judge Manish S. Shah of the US District Court for the Northern District of Illinois said Thursday in a preliminary injunction order.

The order comes in a lawsuit brought by California, Colorado, Illinois, and Minnesota after reports surfaced that the Trump administration was expected to cut hundreds of millions of dollars in public heath grants to the states. The states claimed the federal government’s efforts stemmed from “political animus and disagreements” on immigration enforcement and other policies.

In February, states succeeded in persuading Shah to grant an emergency temporary restraining order prohibiting the Trump administration from implementing guidance or directives to slash public health grants to the states.

In Thursday’s preliminary injunction order, Shah said a directive from the White House Office of Management and Budget to the US Department of Health and Human Services to target the states for funding cuts likely counts as a final agency action.

He also noted the states were likely to succeed in proving that the OMB’s targeting them needs to be set aside under the Administrative Procedure Act.

Shah also said that “agencies cannot pursue the policy objectives of the executive branch through the power of the purse.” Evidence from the states, he said, supports the idea that OMB’s objective “was unrelated to the Congressional authorization for public-health grants.”

“The federal government has an interest in evaluating grants for alignment with agency priorities,” Shad said. “The states’ sovereign interests here outweigh the executive branch’s likely unlawful interest in using preauthorized funding to shape state-run governance.”

The decision isn’t entirely a win for the states, however. Shah said the court couldn’t actually enforce payment obligations for a federal grant, and that suits over contracts with the US are the domain of the Court of Federal Claims.

The case is Illinois v. Vought, N.D. Ill., No. 1:26-cv-01566, order 3/12/26.