Whitehouse, Markey Lead EPW Democrats in Demanding Zeldin Halt Political Witch Hunt Against Money-Saving Clean Energy Investments

Administrator Zeldin is manipulating facts as a pretext to terminate a congressionally appropriated and legally obligated program that would lower household energy costs, spur economic development, and reduce pollution

Washington, D.C.—Today, Senator Sheldon Whitehouse (D-R.I.), Ranking Member of the U.S. Senate Committee on Environment and Public Works (EPW), and Senator Edward J. Markey (D-M.A.) led all Democratic members of the Committee in demanding that Environmental Protection Agency Administrator Lee Zeldin cease his illegal witch hunt to claw back nearly $20 billion in congressionally appropriated and legally obligated funds that underpin the Greenhouse Gas Reduction Fund (GGRF).  The GGRF would spur economic development, lower energy costs, and reduce pollution.  Not only has Administrator Zeldin gaslit the American public, fabricating claims of fraud at the GGRF without producing any evidence, but he also lacks the legal authority to terminate the agreements with GGRF grantees.  The Senators are demanding that Zeldin cease his unconstitutional persecution of GGRF grantees, that he and his fellow appointees at the Department of Justice (DOJ) and Federal Bureau of Investigation (FBI) cease their politically motivated investigation into the GGRF program, and that he withdraw his request that Citibank pause funding to grantees.

“In just six short weeks, your performance in the role of Administrator of the Environmental Protection Agency (EPA) has prioritized lawlessness and disdain for the Constitution over lowering household energy costs, incentivizing economic growth, and reducing pollution.  Your latest, baseless assault on the Greenhouse Gas Reduction Fund (GGRF) grants being managed by Citibank, N.A. (Citibank) escalates your illegal attempts to unilaterally claw back Congressionally appropriated and contractually obligated funding,” wrote Senators Whitehouse, Markey, Sanders, Merkley, Kelly, Padilla, Schiff, Blunt Rochester, and Alsobrooks. 

On February 12, 2025, Administrator Zeldin announced via social media that he had “found” $20 billion in EPA funds at Citibank and falsely suggested that the use of an FAA—a commonly used financial tool that presidential administrations have used for centuries—was improper.  Although the FAA between Citibank and Treasury had been announced publicly in April 2024 by the Biden administration, Administrator Zeldin promoted his so-called “discovery” as justification to call for the termination of the agreement and demanded that the GGRF funds be returned to EPA.  A career prosecutor in the U.S. Attorney’s Office for the District of Columbia was forced to resign after she cited lack of evidence and refused to open an investigation into the program, and the Trump administration has now weaponized the FBI against it.  Without producing a shred of evidence of misconduct, the EPA instructed Citibank to indefinitely pause disbursement of the grants, and on March 11, 2025, while the legally unfounded investigations remained ongoing, Administrator Zeldin announced he “‘ha[d] officially terminated [the Citibank GGRF] grant agreements—entirely.’”

“It is one thing to commit to rooting out waste, fraud, and abuse in federal government programs.  Everyone agrees that there should be robust oversight of major grant programs like GGRF.  That is exactly why the Biden Administration engaged in a rigorous, transparent process to select Citibank as its financial agent and ensure that the various agreements that govern the arrangement provide for adequate oversight.  But it is another thing altogether to manufacture problems out of whole cloth where none exist simply because the GGRF would reduce Americans’ dependence on the expensive, dirty fossil fuels that President Trump’s donors produce.  The fact that you or President Trump does not like these grants is not sufficient reason to terminate them,” wrote the Senators.

EPA’s ideological crusade against GGRF’s clean energy investments is not only unconstitutional and illegal, but, if successful, it would actively undermine Americans’ safety and well-being.  In Hampton, Virginia, GGRF funding was slated for investment to reduce flooding risk near many Navy and Air Force installations.  Lee County, Florida, planned to use GGRF funds to build community centers to house residents during extreme weather events.  While less than a year old, GGRF-funded projects were already planned in communities across the country, including in Virginia, Georgia, North Carolina, Florida, Oregon, Texas, and Minnesota. 

“We demand that you be a better steward of the Congressionally appropriated and obligated funding with which you have been entrusted.  We demand that you be a better steward of the environment.  The American people deserve public servants, not paid shills,” concluded the Senators.

The text of the letter is below, and a full version (with footnotes) is available HERE.

Dear Administrator Zeldin:

In just six short weeks, your performance in the role of Administrator of the Environmental Protection Agency (EPA) has prioritized lawlessness and disdain for the Constitution over lowering household energy costs, incentivizing economic growth, and reducing pollution.  Your latest, baseless assault on the Greenhouse Gas Reduction Fund (GGRF) grants being managed by Citibank, N.A. (Citibank) escalates your illegal attempts to unilaterally claw back Congressionally appropriated and contractually obligated funding.   In the unlikely event that your efforts are not eventually halted by a federal judge, the termination of the GGRF will drive up energy costs, deepen our reliance on foreign oil, and worsen climate change—threatening our entire economy.  Accordingly, we demand that you rescind your announced termination of the GGRF grant agreements, that you and your fellow appointees at the Department of Justice (DOJ) and Federal Bureau of Investigation (FBI) cease your politically motivated investigation into the GGRF program, and that you withdraw your request that Citibank pause funding to grantees.

On February 12, 2025, you announced that you had “found” $20 billion in EPA funds at Citibank and falsely suggested that the use of a financial agent agreement (FAA)—a commonly used financial tool that presidential administrations have used for centuries—was improper.  In reality, the FAA between Citibank and Treasury had been announced publicly in April 2024 by the Biden Administration after a rigorous and transparent process.  Because there was no legal basis for your attempt to claw back the GGRF grants, we called on you to reconsider your decision in a letter dated February 24, 2025.

You ignored that letter—as you have the several other letters EPW Committee Democrats have sent you this year.  Following your February 12 announcement, EPA appears to have worked in concert with other federal agencies to further your illegal scheme.

According to documents filed by Citibank in federal court on March 12, 2025, FBI reached out to Citibank on February 17, 2025—just five days after your announcement—requesting that it freeze the accounts of the eight GGRF grantees.  This coincides with public reporting that DOJ had launched an investigation into the GGRF shortly after you publicly announced your desire to claw back the funding.  But reporting on the conduct of that investigation casts doubt on whether it is adequately predicated.  Interim U.S. Attorney for the District of Columbia Ed Martin, who posted critical statements about the GGRF funding before taking office, first pressured a career prosecutor to open an investigation into the program on February 17, 2025 (the same day FBI eventually wrote to Citibank); when she refused, citing a lack of evidence, she was forced to resign.  Martin then personally submitted a seizure warrant application to freeze the funding.  A D.C. magistrate judge rejected that request because no evidence supported it.  Then-Acting Deputy Attorney General Emil Bove reportedly took the unusual next step of asking other U.S. Attorney’s offices to pursue the same investigation and warrant application.  At the request of the U.S. Attorney’s Office for the Southern District of Florida, the FBI questioned EPA employees about the GGRF funding.  Martin also sent letters to at least two organizations awarded funding through GGRF, ordering the groups to turn over records to the FBI.  The groups received a summons to appear in federal court later this month. 

Then, on March 4, the Department of the Treasury instructed Citibank not to disburse funds from any of the eight accounts through Sunday, March 9.  In the early hours of March 10, Treasury then appears to have ceded further participation in the contractual arrangement to EPA, “instructing Citibank . . . to comply with EPA’s instructions.”  This directive allowed EPA to send an email around the same time directing Citibank to pause indefinitely disbursement of the grants “[u]ntil . . . additional account controls are developed” and pending the resolution of the “ongoing investigations.”  Notably, nowhere in any of the documents filed in federal court is there any allegation by EPA of any specific wrongdoing by any grantee.

On March 11, 2025—just one day after EPA’s last email to Citibank and while the legally unfounded investigations remain ongoing—you announced that you “ha[d] officially terminated [the Citibank GGRF] grant agreements—entirely.”  In letters sent to the eight individual grantees, Acting Deputy Administrator Chad McIntosh explained that EPA was exercising its authority under 2 CFR 200.339-340 to terminate each grant agreement based on “substantial concerns regarding program integrity, the award process, programmatic fraud, waste, and abuse, and misalignment with the Agency’s priorities.”  He also cited nebulous categories of material deficiencies that he summarily concluded “pose[d] an unacceptable risk to the efficient and lawful execution of th[e] grant.”  Given the timing of Treasury’s and EPA’s communications with Citibank, it certainly seems as if EPA was attempting to create a pretext for your March 11 termination announcement.

But notwithstanding whatever you wish to be true, Acting Deputy Administrator McIntosh’s letter alone is procedurally and substantively insufficient to terminate the grant agreements.  The relevant tri-party Account Control Agreements (ACAs) between Citibank, EPA, and each grantee include very specific terms governing termination.  Clause 17 of the ACA allows EPA to provide Citibank notice that its “security interest in [the] Accounts and all assets therein have terminated,” but that clause also requires that the “Bank shall . . . promptly forward any amounts held by the Bank in the Accounts to the [grantee].”  Accordingly, if EPA is terminating the contracts under that provision, it is the grantees who would receive the funds.

Alternatively, the ACAs allow EPA to take “exclusive control” of funds back from Citibank.  This requires that EPA inform Citibank that EPA is exercising the “exclusive control” option, and EPA must first “issue[] a written determination and finding that [the grantee] has failed to comply with the terms and conditions of the Grant Agreement, and that noncompliance is substantial such that effective performance of the Grant Agreement is materially impaired or there is adequate evidence of waste, fraud, material misrepresentation of eligibility status, or abuse, and that [EPA] has initiated action under 2 CFR 200.399 to wholly or partly suspend or terminate the Grant Agreement.”

Here, the letters sent to grantees are insufficient to provide a basis for EPA to take “exclusive control” of the funds in any of the accounts.  None of the letters even allege—let alone provide evidence—that any grantee “has failed to comply with the terms and conditions of the Grant Agreement”—a foundational requirement for EPA to exercise “exclusive control.”  Instead, the letters allege only that EPA has some nebulous “concerns” with overall programmatic matters and the manner in which funds were allocated.  Those “concerns”—which are unfounded—are also irrelevant.  There is not one single allegation that any grantee has failed to comply with the terms and conditions of the ACA—let alone that any such failure “materially impair[s]” effective performance of the ACA.

And these are just the Constitutional and contractual reasons why your plan to terminate the GGRF is illegal.  As noted above, the GGRF will also benefit Americans around the country, including Navy and Air Force veterans in Hampton, VA, where the GGRF is slated to fund infrastructure to reduce flood risk.  And retirees in Lee County, Florida where the GGRF is funding community centers to protect them during extreme weather events.  And communities in western Virginia and the Leech Lake Band of Ojibwe in northern Minnesota where the GGRF is funding projects in reduce air pollution and improve water quality.

It is one thing to commit to rooting out waste, fraud, and abuse in federal government programs.  Everyone agrees that there should be robust oversight of major grant programs like GGRF.  That is exactly why the Biden Administration engaged in a rigorous, transparent process to select Citibank as its financial agent and ensure that the various agreements that govern the arrangement provide for adequate oversight.  But it is another thing altogether to manufacture problems out of whole cloth where none exist simply because the GGRF would reduce Americans’ dependence on the expensive, dirty fossil fuels that President Trump’s donors produce.  The fact that you or President Trump does not like these grants is not sufficient reason to terminate them.

We demand that you be a better steward of the Congressionally appropriated and obligated funding with which you have been entrusted.  We demand that you be a better steward of the environment.  The American people deserve public servants, not paid shills.