Whitehouse, EPW Democrats Demand Answers About EPA’s Illegal Efforts to Clawback Clean Energy Funding
Administrator Zeldin is manipulating facts as a pretext to terminate an already-obligated, Congressionally authorized 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), led all Democratic members of the Committee in demanding answers about EPA Administrator Lee Zeldin’s illegal efforts to claw back federal investments in clean energy deployment that would spur economic development, lower energy costs, and reduce pollution. The letter comes as the Trump administration has made clear its plans to disregard congressional authority and rescind nearly $20 billion in legally obligated funding from the Greenhouse Gas Reduction Fund (GGRF). To justify the clawback of the previously obligated funds, Administrator Zeldin is gaslighting the American public by fabricating claims of waste, fraud, and abuse. The Senators are demanding that Administrator Zeldin follow the law, reconsider his attempts to claw back the GGRF funding, and provide answers by March 3, 2025.
“We write in regards to your apparent attempt to claw back Greenhouse Gas Reduction Fund (GGRF) grants that are maintained by Citibank, N.A. (Citi) pursuant to a legally executed financial agent agreement (FAA) between Citi and the Department of the Treasury (Treasury). Across EPA, the Trump Administration is already illegally ‘pausing’ grantees’ congressionally appropriated funding—and flouting federal court orders. Because there is no legal basis for the Environmental Protection Agency (EPA) to claw back these expended GGRF grants, and because doing so would destroy thousands of jobs and harm hundreds of communities across the country, we call on you to respect applicable legal authority, reconsider your decision, and ensure funding is available as the law requires,” wrote Senators Whitehouse, Markey, Sanders, Merkley, Kelly, Padilla, Schiff, Blunt Rochester, and Alsobrooks.
On February 12 and 13, 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 funds be returned to EPA.
“The claims in your Twitter post are inaccurate and misleading. You and your team discovered nothing—and certainly not taxpayer money being wasted …. [T]he only thing you and your team ‘located’ is a public press release from April 4, 2024. On that day, the EPA announced that, following a competitive and transparent process and using a timeline established by Congress in statute, it had selected eight organizations to receive $20 billion in funding through the GGRF, a program that would deliver 310 million metric tons of carbon reduction and create hundreds of thousands of jobs over the subsequent seven years. The announcement was widely covered by the media, including The New York Times, The Washington Post, Reuters, PBS, and Newsweek, among others. In short, you ‘found’ nothing new,” continued the Senators.
“Second, the timing of the Biden Administration’s April 2024 announcement undermines your spurious claims about its motivations for entering into the FAA. You claim that the Biden Administration had ‘purposefully designed [the agreement] to obligate the money in a rush job with reduced oversight’ because it was ‘rushing to get billions of your tax dollars out the door before Inauguration Day.’ Contrary to your suggestion, the public press release and reporting cited above make clear that EPA’s decision to have Citi manage GGRF grants was made by April 2024—seven months before the 2024 election and more than nine months before inauguration day.”
“Third, you suggest that the use of FAAs by the U.S. government is unprecedented, noting that EPA has never used one. But the fact that EPA has never needed to use an FAA ignores the fact that Treasury utilizes these agreements on a regular basis. In fact, Treasury has an entire division dedicated to negotiating FAAs on behalf of U.S. government entities known as the Bureau of the Fiscal Service. FAAs are routine funding mechanisms first authorized in the 1860s that have been used by Republican and Democratic administrations for decades.”
“Your announcement is the latest example of the Trump Administration and its government efficiency ‘experts’ using unfounded claims of waste, fraud, and abuse as a smokescreen to ignore congressional spending authority and ignore court orders in order to freeze or terminate programs designed to reduce carbon pollution,” emphasized the Senators.
EPW Democrats demanded answers by March 3, 2025.
The text of the letter is below, and a full version (with footnotes) is available here.
Dear Administrator Zeldin:
We write in regards to your apparent attempt to claw back Greenhouse Gas Reduction Fund (GGRF) grants that are maintained by Citibank, N.A. (Citi) pursuant to a legally executed financial agent agreement (FAA) between Citi and the Department of the Treasury (Treasury). Across EPA, the Trump Administration is already illegally “pausing” grantees’ congressionally appropriated funding—and flouting federal court orders. Because there is no legal basis for the Environmental Protection Agency (EPA) to claw back these expended GGRF grants, and because doing so would destroy thousands of jobs and harm hundreds of communities across the country, we call on you to respect applicable legal authority, reconsider your decision, and ensure funding is available as the law requires.
On February 12, 2025, you posted a so-called “BIG UPDATE!” on Twitter, noting that you had “found” $20 billion in taxpayer money that the Biden Administration had allegedly mishandled. In the video, you suggested that your team’s discovery was that “roughly $20 billion of your taxpayer dollars had been parked at an outside financial institution.” In the video and in a follow-up February 13, 2025, EPA press release, you called for the “termination” of the FAA between Treasury and Citi and demanded the “immediate return of the entire fund balance to the United States Treasury to ensure EPA oversight.” Although the circumstances remain murky, public reporting and information obtained by Committee Democrats since your announcement indicates that grantees are unable to draw down funds from Citi—effectively freezing those congressionally appropriated grants.
The claims in your Twitter post are inaccurate and misleading. You and your team discovered nothing—and certainly not taxpayer money being wasted.
First, the only thing you and your team “located” is a public press release from April 4, 2024. On that day, the EPA announced that, following a competitive and transparent process and using a timeline established by Congress in statute, it had selected eight organizations to receive $20 billion in funding through the GGRF, a program that would deliver 310 million metric tons of carbon reduction and create hundreds of thousands of jobs over the subsequent seven years. The announcement was widely covered by the media, including The New York Times, The Washington Post, Reuters, The Associated Press, and Newsweek, among others.6 In short, you “found” nothing new.
Second, the timing of the Biden Administration’s April 2024 announcement undermines your spurious claims about its motivations for entering into the FAA. You claim that the Biden Administration had “purposefully designed [the agreement] to obligate the money in a rush job with reduced oversight” because it was “rushing to get billions of your tax dollars out the door before inauguration day.” Contrary to your suggestion, the public press release and reporting cited above make clear that EPA’s decision to have Citi manage GGRF grants was made by April 2024—seven months before the 2024 election and more than nine months before inauguration day. Additionally, Congress established in law a deadline of September 30, 2024, by which funding had to be allocated to awardees—the EPA had no choice but to meet it.
Third, you suggest that the use of FAAs by the U.S. government is unprecedented, noting that EPA has never used one. But the fact that EPA has never needed to use an FAA ignores the fact that Treasury utilizes these agreements on a regular basis. In fact, Treasury has an entire division dedicated to negotiating FAAs on behalf of U.S. government entities known as the Bureau of the Fiscal Service. FAAs are routine funding mechanisms first authorized in the 1860s that have been used by Republican and Democratic administrations for decades. They are designed to disburse federal funds in a way that maintains oversight of how the funds are used while enabling grantees to leverage contractually obligated funds in private financial markets. Previous administrations have used FAAs to administer important programs to millions of Americans, including Social Security benefits, tax filings, retirement savings, and veterans’ benefits. The first Trump Administration relied on FAAs to meet various financial needs, including to distribute loans to small businesses and streamline the delivery of federal financial assistance to the airline industry during the pandemic.
Fourth, your concerns about oversight are unfounded. The FAA specifically provides several relevant U.S. government agencies, including Treasury and EPA, with direct oversight over Citi, including access to transaction-level data. The bank is also required to conduct “Know Your Customer” due diligence, and grantees are limited to using funds consistent with an extensive set of terms and conditions. Furthermore, the agreements between the grantees, EPA, and Citi make clear that EPA may take “exclusive control” of individual grantees’ funds where there is evidence of waste, fraud, or abuse. Tellingly, you levy no allegations of waste, fraud, or abuse— because you have evidence of none.
Your announcement is the latest example of the Trump Administration and its government efficiency “experts” using unfounded claims of waste, fraud, and abuse as a smokescreen to ignore congressional spending authority and ignore court orders in order to freeze or terminate programs designed to reduce carbon pollution.
Accordingly, in order to assist in our investigation of EPA’s decision-making process, please respond to the following questions by no later than March 3, 2025:
1. Under what authority, including contractual provisions, and under what conditions do you believe the EPA, Treasury, or any other agency of the U.S. government may terminate the Financial Agent Agreement between Treasury and Citi? Please explain your interpretation in detail.
2. If the FAA were to be terminated, what is your understanding of Citi’s obligations under the contract(s) with respect to funds remaining in its possession that have not been drawn down by grantees?
3. Do you agree that the existing Account Control Agreements (ACAs) between each grantee, EPA, and Citi only provide EPA the ability to take “exclusive control” of funding held by Citi for the benefit of the grantees where EPA can demonstrate noncompliance by the grantee and where “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”? If you do not agree, please explain and provide your understanding of the circumstances in which EPA may assume control of already-obligated funds, recognizing this is contrary to existing, legally binding contract language. Please cite to specific contractual, statutory, or regulatory authorities supporting your position. We note that executive orders do not qualify as statutory or regulatory authority, as they are neither statutes nor regulations.
4. Did any individual or office within the White House, the Office of Management and Budget (OMB), the Department of the Treasury, or the so-called “Department of Government Efficiency” specifically instruct you to announce that you were calling for the termination of the FAA between Treasury and Citi?
5. Has anyone at EPA, Treasury, the Department of Justice, the Federal Bureau of Investigation, or any other government agency directed Citi to freeze the GGRF funds the bank is holding pursuant to the FAA, preventing grantees from accessing them? If so, who so directed Citi? Please provide a detailed explanation.
6. Please provide all communications dated November 5, 2024, through present, among and between you, Treasury officials, the Trump-Vance Transition Team, the White House, Elon Musk, anyone working for or affiliated with the so-called “Department of Government Efficiency,” Russell Vought, and/or Office of Management and Budget officials—including but not limited to all “special government employees”—concerning (i) the video featuring an EPA employee that you reference in your February 12, 2025 video; (ii) the FAA between Citibank and Treasury; or (iii) the GGRF.
Thank you for your attention to this matter.
