Trump Administration Freezes $2.1 Billion in Chicago Infrastructure Funding

Chicago’s leadership just received an unexpected blow from Washington. The Trump administration has frozen $2.1 billion in federal funding for two major Chicago Transit Authority (CTA) projects, citing concerns over race-based contracting practices.

Federal Funding Under Review

Russell Vought, Director of the Office of Management and Budget (OMB), announced the decision on X (formerly Twitter), confirming that funding for the Red Line Extension and the Red and Purple Modernization Project has been paused.

According to Vought, the freeze aims to ensure that no federal dollars are distributed through unconstitutional race- or sex-based contracting requirements.

The U.S. Department of Transportation (USDOT) followed up with an official statement explaining that both Chicago projects are now under administrative review. The department said it will determine whether any discriminatory or illegal contracting practices have taken place.

New Federal Rule Targets Race- and Sex-Based Preferences

Earlier this month, USDOT issued an interim final rule (IFR) that bars race- and sex-based contracting requirements from federal grants. The new rule removes automatic presumptions of disadvantage under the Disadvantaged Business Enterprise (DBE) program, requiring firms to demonstrate eligibility individually rather than by group identity.

The department said the reviews will ensure that no federal funds are used for “discriminatory, illegal, or wasteful practices.” USDOT added that Americans “don’t care what race or gender construction workers or electricians are — they just want projects completed quickly and efficiently.”

Broader Impact Across the Country

This move follows an earlier decision by the Trump administration to freeze roughly $18 billion in infrastructure funding for New York, also tied to concerns about equity-based contracting policies.

Federal officials indicated that more cities could face similar reviews if they continue to use race- or gender-based criteria in public contracting.

Chicago Officials Await Clarification

Mayor Brandon Johnson’s administration has not yet issued a detailed response. However, city officials have warned that the freeze could delay critical transit upgrades and impact thousands of jobs.

USDOT said it is working to complete the reviews as quickly as possible, though it noted that the recent government shutdown has limited staffing resources needed to finalize the process.

What Comes Next

For now, both the CTA Red Line Extension and the Red and Purple Modernization Project remain in limbo. Federal funding could resume once the reviews are completed — or remain blocked if the projects are found to violate new contracting rules.

The administration has made one point clear: federal money will no longer flow to projects that fail to meet its interpretation of constitutional contracting standards.