In a landmark decision on Tuesday, Chief Judge John McConnell of the US District Court of Rhode Island struck down a contentious policy that conditioned federal transportation funding on state cooperation with federal immigration enforcement. This ruling comes after a lawsuit was filed in May by twenty Democratic state attorneys general, challenging the Department of Transportation's (DOT) authority to withhold billions in federal funds.

The controversial "Immigration Enforcement Condition" (IEC) was introduced following an executive order by President Trump, which aimed at restricting sanctuary cities from accessing federal grants. The DOT then required states to align with federal immigration policies as a prerequisite for funding, a move that prompted widespread legal scrutiny.

Judge McConnell's decision was based on three critical points: the absence of statutory backing for the IEC, its violation of the Administrative Procedure Act (APA), and its inconsistency with the Spending Clause of the U.S. Constitution. The court highlighted that the DOT's grant statutes do not authorize the imposition of immigration-related conditions and branded the IEC as "arbitrary and capricious."

Furthermore, the ruling emphasized that such conditions bear no reasonable relationship to the objectives of transportation infrastructure programs, thereby violating the doctrine that federal funding conditions must be pertinent to the purpose of the grants.

The DOT defended the legality of the IEC by citing its broad statutory mandates, which it claimed provided leeway to impose additional conditions on state grants. However, the court's interpretation of these statutes led to the conclusion that Congress did not intend for the DOT to wield such expansive powers over immigration matters through transportation funding.

This decision represents a significant setback for efforts to leverage federal funding as a tool for enforcing immigration compliance at the state level. It underscores the judiciary's role in maintaining the balance of power between federal and state authorities, particularly in areas where policy objectives may conflict.

As the DOT is enjoined from enforcing the IEC, states previously at risk of losing funding due to non-compliance with the immigration condition now retain access to vital transportation funds, ensuring ongoing projects and planning can proceed without additional legal hurdles.