A group of states is taking legal action against the Trump administration, challenging what they see as unjust hurdles linked to the disbursement of grant funds managed by the Federal Emergency Management Agency (FEMA).

This summer, FEMA introduced new directives affecting two longstanding programs designed to aid states in organizing large-scale emergency responses and enhancing anti-terrorism measures.

On Tuesday, Michigan led a coalition of 12 states in filing a 35-page lawsuit, arguing that FEMA’s recent directives impose “unlawful terms” that overstep congressional authority and contravene the Administrative Procedure Act, which governs federal agency operations.

The lawsuit claims these terms create undue obstacles for states to access grant funds, effectively reducing financial support for state and local law enforcement and emergency services nationwide, which are the primary beneficiaries of these grants.

The first contentious term involves the Emergency Management Performance Grant (EMPG) program, operational since 2003. This stipulation requires states to confirm their population figures as of September 30, 2025, before receiving funds.

The states, however, say they simply do not have the data necessary to make such certifications because population data is a federal affair.

The plaintiffs argue this disconnect between the federal data source and what FEMA is demanding of the non-data-bearing state recipients is clear evidence the new EMPG term is “arbitrary and capricious,” a term of art which refers to agency actions that go too far while simultaneously eschewing formal, mandatory processes.

From the filing, at length:

[T]he imposition of the Population Certification Hold does not reflect reasoned decision making. This is proved by the lack of any affirmative explanation from Defendants. And it is confirmed by the fact that Plaintiffs States cannot comply with the Population Certification Hold. Had Defendants engaged in reasoned decision making, they would have understood that they—not the States—are obligated to obtain population data, and that data must come from the U.S. Census Bureau.

“States do not keep such detailed, to-the-minute population counts (they primarily rely on the U.S. Census Bureau’s data and estimates) and lack information to determine the precise number of recently removed individuals,” the lawsuit continues.

The plaintiffs also argue the first term is also “unlawful” because “no statute permits Defendants to impose such a hold.”

The second disputed term pertains to the Homeland Security Grant Program (HSGP) — which has been in place since 2001 — as well as the EMPG program. This term reduces the so-called “period of performance.” Or, in other words, the second term shortens the time period in which states can be reimbursed via the awards.

In real terms, where states once had three years to perform activities eligible under the programs, the states now have one year to lump such activities together for reimbursement.

“This unexplained change seriously disrupts the reasonable reliance interests of Plaintiff States and their localities,” the lawsuit goes on. “At best, it imposes significant obstacles upon recipients’ ability to utilize the funds for emergency management and security activities that fall within the scope of the grants; at worst, it makes the EMPG and HSGP funding largely unusable.”

Furthermore, the new performance period term is not a rolling one-year grant; and is dated to, and only for, the current fiscal year.

The lawsuit says this will prove unworkable:

Since the program’s initiation, EMPG funds have been awarded with either a two or a three-year period of performance. A multi-year period of performance for the EMPG helps provide States and sub-grantees with the flexibility needed to utilize the grant funds when they are needed. It also allows grantees to engage in long-term projects that take more than a year to complete…

Additionally, for more than a decade, FEMA has backdated the EMPG period of performance by one year. Because of this, States can (and typically do) use part of their funding to reimburse localities for salaries and other emergency management expenses previously incurred during the backdated award period.

The plaintiffs cast the new FEMA terms as the latest in a long line of Trump administration efforts to restructure emergency response.

“[I]gnoring history’s teachings, the Trump administration has repeatedly expressed a desire to diminish FEMA’s role and shift the burden of emergency management to the States, thus reverting to an inconsistent patchwork of disaster response,” the complaint reads. “The Trump administration has taken numerous actions in furtherance of this goal—including denying or restricting requests for emergency declarations, withholding grant funding, and imposing irrelevant and unconstitutional terms on recipients of long-standing FEMA grants—many of which have been successfully challenged in court.”

The lawsuit offers this historical backdrop as something of a previewed fait accompli — saying the latest terms are likely doomed to the same fate as prior attempts to paring down FEMA’s reach.

“But the Trump administration runs into a persistent problem: Congress has not acquiesced in or approved of scaling back FEMA,” the lawsuit goes on. “Plaintiff States seek declaratory and injunctive relief and to set aside the Population Certification Hold and Performance Period Change, thereby allowing the Plaintiff States to receive and utilize the EMPG and HSGP funds as Congress intended.”

The lawsuit is filed in the Oregon District Court; the case has yet to be assigned to a district judge as of this writing.