Trump admin freezes $2.1 billion for Chicago projects, blames Democrats for shutdown holdup
The move came on the third day of the federal government shutdown, which President Donald Trump has blamed on Democrats in Congress.
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The Trump administration on Friday froze $2.1 billion in Department of Transportation funding for two projects to improve Chicago's transit system.
The DOT in a statement blamed Congress' two Democratic leaders — Sen. Chuck Schumer and Rep. Hakeem Jeffries — for the federal government shutdown, which the department claimed would slow a review of the Chicago projects to ensure they do not involve "unconstitutional practices" related to the race or gender of construction workers.
That statement echoed a Trump administration talking point that Democrats in Congress are refusing to vote for a short-term funding agreement that would reopen the government because they insist on providing health-care benefits for "illegal immigrants."
Democrats call that claim a lie designed to distract from their goal of continuing the offer of enhanced Affordable Care Act health insurance plan subsidies to more than 20 million Americans.
"At a time when federal agents are sowing chaos in Chicago, the Trump administration is holding bipartisan funding hostage," Illinois Gov. JB Pritzker said in a social media post on X after the DOT's announcement.
"It's attempting to score political points but is instead hurting our economy and the hardworking people who rely on public transit to get to work or school," wrote Pritzker, who, like Chicago Mayor Brandon Johnson, is a Democrat.
Johnson, in a statement, said, "Argentina gets $20 billion and the South Side gets nothing. What happened to America First?" The mayor's comment referenced a Trump administration officer to bolster Argentina's sputtering economy with a $20 billion credit line, and a Chicago neighborhood relying on one of the transit improvement projects.
"South Siders have waited for more than 50 years for the Red Line Extension," Johnson said, referring to a project that would extend that train line by 5.5 miles with four new stations.
"This project will bring 25,000 jobs to the Chicago area and billions in new development. The Red Line Extension is the single largest investment in the Far South Side in a generation," he said.
"Right when we are finally on the brink of moving forward, Trump just cut off the funding," Johnson said. "From public safety to public education to public transit, this president is cutting the services that working people rely upon."
Office of Management and Budget Director Russell Vought first announced the freeze on the Chicago projects on Friday morning.
It was the third time in recent days that he revealed funding actions by the Trump administration targeting cities and states led by Democrats.
Russ Vought, Director of the US Office of Management and Budget (OMB), speaks at the National Conservative Convention in Washington D.C., Sept. 3, 2025.
Dominic Gwinn | Afp | Getty Images
President Donald Trump and Republican lawmakers have blamed Democrats in Congress for the shutdown, which hit its third day on Friday.
Trump said on Thursday that the shutdown had given him an "unprecedented opportunity" to cut what he called "Democrat Agencies."
Vought on Wednesday revealed that the Department of Transportation was freezing $18 billion in federal funding for two major infrastructure projects in New York City. Both Schumer and Jeffries are from New York City.
Later that same day, Vought said that the Department of Energy had cancelled nearly $8 billion in funding for climate-related projects and other efforts in 16 states, all of which were won by Democratic presidential nominee Kamala Harris in the 2024 election.
On Friday, Vought, in a post on X, wrote, "$2.1 billion in Chicago infrastructure projects -- specifically the Red Line Extension and the Red and Purple Modernization Project -- have been put on hold to ensure funding is not flowing via race-based contracting."
A rider heads toward the stairs to board a Red Line train at the CTA Grand station on Dec. 19, 2023, in Chicago.
Eileen T. Meslar | Chicago Tribune | Tribune News Service | Getty Images
Both projects are overseen by the Chicago Transit Authority, which operates the city's train and bus system.
The Red and Purple Modernization Project is reconstructing infrastructure along those color train lines.
The U.S. DOT later Friday said, "This week, USDOT issued an interim final rule (IFR) barring race- and sex-based contracting requirements from federal grants."
"To continue implementation of this rule, USDOT today sent letters to the Chicago Transit Authority (CTA) to inform them that" the two CTA projects "are also under administrative review to determine whether any unconstitutional practices are occurring," the DOT said.
The DOT in its statement said the freeze on the Chicago money "is in addition to reviews of New York's Second Avenue Subway and Hudson Tunnel projects," the department said. "Illinois, like New York, is well known to promote race- and sex-based contracting and other racial preferences as a public policy."
The DOT also said that Americans "don't care what race or gender construction workers, pipefitters, or electricians are. They just want these massive projects finally built quickly and efficiently."
"Unfortunately, Chuck Schumer and Hakeem Jeffries' decision to shut down the government has negatively affected the Department's staffing resources for carrying out this important analysis," the department said.
"We urge Democrats in Congress to stop holding the federal government's budget hostage so USDOT can get back to the important work of the American people," the DOT said.
"Benefits for illegal immigrants are not worth potential impacts to important investments in our nation's transportation infrastructure," the department said.
