How Trump's EPA wrecking ball could also damage new housing
President Donald Trump has dismantled federal agencies and slashed spending as he's pledged to " gut the weaponized deep state."
He has also vowed to ease the housing shortage across the nation. One promise may come at the expense of the other in the case of one agency's retrenchment.
In February, his administration sought to take back $20 billion awarded by the Environmental Protection Agency during Joe Biden's presidency to fund decarbonization projects around the country. The head of the EPA has justified the clawback attempt with unproven accusations that the grants were marred by "programmatic fraud, waste, and abuse."
As a result, tens of thousands of new apartments and houses that were expected to be financed with a portion of the EPA money are now in danger of not being built, nonprofit groups who were granted the funding say.
Climate United, a coalition that received roughly $7 billion of the money — known as the Greenhouse Gas Reduction Fund — is suing the EPA along with other awardees over the withheld funding. The nonprofit estimates that about 30,000 single-family homes and another 30,000 apartment units were to be built with some of the funds that it and another group were set to administer.
"There's a significant part of the strategy focused on building not only new housing but new affordable and workforce housing," Beth Bafford, the CEO of Climate United, said.
There are varied estimates on how many new homes are needed in the US. Freddie Mac, a mortgage lending agency, calculated recently that the country is short about 3.7 million units.
While the tens of thousands of homes that might be built with money from the GGRF would be just a small contribution toward that huge need, the fund's proponents say the money would go to a particularly impactful segment of the market.
Bafford said that the focus of the GGRF money was on housing development projects in a part of the market with a lack of private sector financing options: affordable projects using energy-efficient systems and materials that are environmentally sustainable while helping mitigate utility costs for residents.
"We see massive gaps in the financial markets, and this program was built to address some of those gaps," Bafford said.
A spokesperson for Climate United said it had "disbursed $25 million in loans and committed over $500 million in loans before the EPA terminated our grant agreement without warning."
"Unlike the Biden-Haris administration, this EPA is committed to being an exceptional steward of taxpayer dollars," an unnamed spokesperson from the EPA responded in an email.
The spokesperson said the GGRF's termination was "based on substantial concerns" over its "integrity, the award process, and programmatic waste and abuse, which collectively undermine the fundamental goals and statutory objectives of the award."
Some developers are already feeling the impact
The impacts of the freeze have already been felt by some developers.
Megan Lasch, the chief executive of O-SDA Industries, a for-profit builder of affordable housing based in Austin, said the EPA's clawback attempt made her reshuffle a portion of the financing package she had been arranging for a 90-unit affordable apartment project her firm is developing in Fort Worth, Texas.
The roughly $37 million development involves renovating 801 West Shaw St., a historic building with 45 rental apartments, erecting an additional 45 units on land adjacent to the property, and building a pre-K facility.
Lasch said she had arranged to use some $3 million of GGRF money for the project from the Local Initiatives Support Corporation, a member of Power Forward Communities, a coalition that received $2 billion of the EPA money.
When the GGRF money was held up, Lasch said that she found a replacement loan but that the new funding is more costly, carrying a roughly 4.5% interest rate versus the GGRF loan's roughly 1% rate.
"The patch was not pretty," Lasch said, adding that affordable housing projects often have thin margins and require deeply discounted financing to work. "There's going to be ultimately a lot of projects that will just go by the wayside because they're not able to come up with a patch."
The 801 West Shaw St. building is set to offer rents that are affordable for residents who earn between 30% and 60% of the area's median income, Lasch said.
Damon Burns, the CEO of Finance New Orleans, a public trust that helps fund and develop affordable housing in its namesake city, said that his organization had been allocated $5 million from the Coalition for Green Capital, which received $5 billion of GGRF money from the EPA.
Finance New Orleans was seeking to use about $1 million of that $5 million it was to receive in combination with $1.5 million of other funds it holds to build six or seven new homes with net-zero emissions.
Using GGRF money to augment his organization's funding pipeline to build more housing was a model that Burns said he had hoped to scale.
He said the prospect of having the GGRF money withdrawn was daunting because New Orleans is "already a financially constrained city."
"There is a huge concern that the disinvestment of the federal government will have an impact on all of our communities," Burns said. "It means less mortgages for homeowners. It means less capital for developers."
A climate-focused financing initiative
The GGRF was created with $27 billion of federal funds from the Biden administration's Inflation Reduction Act, which Congress passed in 2022. Some $20 billion of that amount was awarded to Climate United, Power Forward Communities, the Coalition for Green Capital, and other groups for various climate-focused financing initiatives. The remaining $7 billion went toward a federal program to fund residential solar energy installation projects.
In December, Project Veritas, a conservative media organization, published a video that showed a former EPA official suggesting that the agency, under Biden, had fast-tracked its award of the money in anticipation that the incoming Trump administration might seek to scuttle the program.
In the video, the official said: "It truly feels like we're on the Titanic and we're throwing gold bars off the edge."
Lee Zeldin, a former Long Island, New York, congressman whom Trump appointed as the head of the EPA in January, cited the video as evidence of misconduct in the allocation of the funds.
"One of my very top priorities at EPA is to be an excellent steward of your hard-earned tax dollars," Zeldin said in a video posted on his X account in February. "The 'gold bars' were your tax dollars, and tossing them off the Titanic meant the Biden administration knew they were wasting it."
Zeldin has ordered the termination of the GGRF.
In March, Climate United sued the EPA and Citibank, the financial intermediary for the $20 billion, in the federal district court in Washington, DC, over their refusal to release the money. Power Forward and the Coalition for Green Capital have joined the suit.
The EPA lost the initial argument for the case but has brought its complaint to the Court of Appeals for the District of Columbia Circuit, where it won a preliminary order in April to freeze the money as its appeal is being considered. The next hearing in the case is scheduled for Monday.
'Every single project in the country is looking for gap funding'
While Climate United estimated that terminating the GGRF would put roughly 60,000 homes at risk, other parties involved in the financing program say that number could be even greater.
There has been a sharp increase in the number of housing developers interested in tapping financing from the GGRF, said Shaun Donovan, the president and CEO of the nonprofit housing lender Enterprise Community Partners. He was a secretary of the Department of Housing and Urban Development in the Obama administration.
Donovan attributed that interest to growing construction costs from inflation and tariffs, which have driven up the price of building materials. Those overruns have punched holes in the budgets of a host of development projects that builders have scrambled to fill.
"Every single project in the country is looking for gap funding," Donovan said. "What this GGRF money can do is to be that last dollar in, right? So even if it's only 5% or 10% of the project."
A spokesperson for Enterprise said that it had received inquiries for about $1.2 billion of financing in recent months for a collection of projects totaling 18,426 units.
"My concern is that what this and other efforts to cut housing programs will do is make it impossible for the president to meet his goal of reducing housing costs," Donovan said.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
WIRED
17 minutes ago
- WIRED
The ‘Long-Term Danger' of Trump Sending Troops to the LA Protests
Jun 10, 2025 12:24 PM President Trump's deployment of more than 700 Marines to Los Angeles—following ICE raids and mass protests—has ignited a fierce national debate over state sovereignty and civil-military boundaries. LAPD officers and National Guard soldiers stand on patrol as demonstrators protest outside a jail in downtown Los Angeles following two days of clashes with police during a series of immigration raids on June 8, 2025. Photograph:As hundreds of United States Marines deploy in Los Angeles under presidential orders to protect federal property amid growing protests over immigration enforcement, constitutional scholars and civil rights attorneys warn of long-term implications for American democracy and civil-military relations. President Donald Trump revealed Monday that he had ordered the deployment of more than 700 activity-duty Marines out of Camp Pendleton—an extraordinary use of military force in response to civil unrest. The move, widely condemned by his critics, follows Trump's federalization of the National Guard. Some 3,800 guardsmen have since been deployed in California against the objections of its government, spurring debate among legal observers over the limits of the president's power to send troops into American streets. Trump ordered the deployments in response to thousands of Angelenos who took to the streets on Friday in protests. LA residents responded after Immigration and Customs Enforcement (ICE) agents carried out sweeping raids of local businesses, arresting, among others, dozens of day laborers who were vying for work outside a local Home Depot. Larger demonstrations soon formed and remained largely peaceful until residents were engaged by police with riot shields and crowd control weapons. Over the weekend, the clashes between police and protesters escalated across many neighborhoods with large immigrant populations. Numerous buildings were vandalized with anti-ICE messages, and several Waymo autonomous vehicles were set ablaze. Videos captured by protest attendees show police firing upon demonstrators with rubber bullets and other crowd control agents, including waves of asphyxiating CS gas. Members of the press shared images online showing injuries they incurred from the police assault. In widely shared footage, a Los Angeles police officer appears to intentionally target an Australian reporter, Lauren Tomasi, shooting her from feet away with a rubber bullet as she delivers a monologue into a camera. On Monday, CNN correspondent Jason Carroll was arrested live on air. California governor Gavin Newsom condemned Trump's troop deployment in posts on social media, calling the president's actions an 'unmistakable step toward authoritarianism.' His attorney general, Rob Bonata, has filed a lawsuit in federal court claiming the order violated the state's sovereignty, infringing on Newsom's authority as the California National Guard's commander in chief. In response to a request for comment, the Department of Defense referred WIRED to a US Northern Command press release detailing the deployment of Marines and National Guardsmen. Federal troops in the United States are ordinarily barred from participating in civilian law enforcement activities. This rule, known as 'posse comitatus,' may be suspended, however, by a sitting president in cases of civil unrest or outright rebellion. This exception—permitted under the Insurrection Act—allows the president to deploy troops when circumstances make it 'impracticable' for state authorities to enforce federal law by 'ordinary' means. While these powers are most often invoked at the request of a state government, the president may also invoke the act when a state chooses to ignore the constitutional rights of its inhabitants—as happened multiple times in the mid-20th century, when southern states refused to desegregate schools after the Supreme Court's landmark Brown v. Board of Education decision. President Trump, however, has so far not invoked the Insurrection Act, relying instead on a theory of 'inherent authority' advanced by the US Justice Department in 1971 during the height of the anti–Vietnam War protests. This interpretation of presidential power finds that troops may be deployed in an effort to 'protect federal property and functions.' Notably—unlike the Insurrection Act—this does not permit troops to engage in activities that are generally the purview of civilian law enforcement agencies. Trump also invoked statutory power granted to him by Congress under Title 10 of the US Code, which enabled him to federalize elements of California's National Guard. These activations typically occur when guardsmen are needed to support overseas military operations, as happened routinely this century during the wars in Iraq and Afghanistan. Domestically, however, guardsmen are not usually federalized without the agreement of a state's governor—unless the Insurrection Act has been invoked. Legal experts interviewed by WIRED offered a range of opinions on the president's authority to deploy active-duty military troops or federalize the National Guard. While most believe it is likely within Trump's power to ignore Newsom's express objections, doing so without an invocation of the Insurrection Act, they say, is a decision fraught with legal complexities that carries serious implications, from altering—perhaps permanently—the fundamental relationship between Americans, states, and the federal government, to disturbing the delicate balance between civilian governance and military power. Liza Goitein, senior director of the Brennan Center's Liberty and National Security Program, underscores the 'unprecedented' nature of Trump's approach. 'He's trying to basically exercise the powers of the Insurrection Act without invoking it,' she says. A key issue for Goitein is that the memorandum signed by Trump last week federalizing the National Guard makes no mention of Los Angeles or California. Rather, it states that the guardsmen are being mobilized to address protests that are both 'occurring' and 'likely to occur.' In essence, the memo 'authorizes the deployment of federal troops anywhere in the country,' Goitein says, 'including places where there are no protests yet. We're talking about preemptive deployment.' Goitein argues that the administration's justifications could undermine both judicial accountability and civil‑military boundaries. Under the Insurrection Act, federal troops can take on the responsibilities of local and state police. But without it, their authority should be quite limited. Neither the guardsmen nor the Marines, for instance, should engage with protesters acting peacefully, according to Goitein. 'He says they're there to protect federal property,' she says. 'But it looks a lot like quelling civil unrest.' Anthony Kuhn, a 28-year US Army veteran and managing partner at Tully Rinckey, believes, meanwhile, that there is really 'no question' that Trump would be justified in declaring a 'violent rebellion' underway in California, empowering him to ignore Newsom's objections. The images and video of protesters hurling rocks and other items at police and lighting cars on fire all serve as evidence toward that conclusion. 'I know people in California, the governor, the mayor, are trying to frame it as a protest. But at this point,' says Kuhn, 'it's a violent rebellion. You can draw your own conclusions from the pictures and videos floating around.' Kuhn argues that the intentions of the protesters, the politics fueling the demonstrations, don't matter. 'They're attacking federal facilities. They're destroying federal property. So in an attempt to restore the peace, the president has the authority under Title 10 to deploy troops. It's pretty straightforward.' In contrast, Rutgers University professor Bruce Afran says deploying military forces against Americans is 'completely unconstitutional' in the absence of a true state of domestic insurrection. 'There was an attack on ICE's offices, the doorways, there was some graffiti, there were images of protesters breaking into a guardhouse, which was empty,' he says. 'But even if it went to the point of setting a car on fire, that's not a domestic insurrection. That's a protest that is engaged in some illegality. And we have civil means to punish it without the armed forces.' Afran argues that meddling with the expectations of civilians, who naturally anticipate interacting with police but not armed soldiers, can fundamentally alter the relationship between citizens and their government, even blurring the line between democracy and authoritarianism. 'The long-term danger is that we come to accept the role of the army in regulating civilian protest instead of allowing local law enforcement to do the job,' he says. 'And once we accept that new paradigm—to use a kind of BS word—the relationship between the citizen and the government is altered forever.' 'Violent rioters in Los Angeles, enabled by Democrat governor Gavin Newsom, have attacked American law enforcement, set cars on fire, and fueled lawless chaos," Abigail Jackson, a White House spokesperson, tells WIRED. "President Trump rightfully stepped in to protect federal law enforcement officers. When Democrat leaders refuse to protect American citizens, President Trump will always step in.' As the orders to mobilize federal troops have come down, some users on social media have urged service members to consider the orders unlawful and refuse to obey—a move that legal experts say would be very difficult to pull off. David Coombs, a lecturer in criminal procedure and military law at the University of Buffalo and a veteran of the US Army's Judge Advocate General's Corps, says it's hypothetically possible that troops could question whether Trump has the authority to mobilize state guardsmen over the objection of a state governor. 'I think ultimately the answer to that will be yes,' he says. 'But it is a gray area. When you look at the chain of command, it envisions the governor controlling all of these individuals.' Separately, says Coombs, when troops are ordered to mobilize, they could—again, hypothetically—refuse to engage in activities that are beyond the scope of the president's orders, such as carrying out immigration raids or making arrests. 'All they can do in this case, under Title 10 status, is protect the safety of federal personnel and property. If you go beyond that, then it violates the Posse Comitatus Act.' Federal troops, for instance, would need civilian police to step in. At the point, authorities want peaceful protesters to disperse. The San Francisco Chronicle reports that, in a letter on Sunday, Homeland Security Secretary Kristi Noem requested that military troops be directed to detain alleged 'lawbreakers' during protests 'or arrest them,' which legal experts almost universally agree would be illegal under ordinary circumstances. The letter was addressed to Defense Secretary Pete Hegseth and accused the anti-ICE protesters of being 'violent, insurrectionist mobs' aiming to 'protect invaders and military aged males belonging to identified foreign terrorist organizations.' Khun, who warns there's a big difference between philosophizing over what constitutes an unlawful order and disobeying commands, dismisses the idea that troops, in the heat of the moment, will have an option. 'It's not going to be litigated in the middle of an actual deployment,' he says. 'There's no immediate relief, no immediate way to prove that an order is unlawful.' Khun says that were he deployed into a similar situation, 'me and my junior soldiers would not respond to a nonviolent or peaceful protest.' Asked what protesters should expect, should they engage with federal troops trained for combat overseas, Kuhn says the Marines will hold their ground more firmly than police, who are often forced to retreat as mobs approach. In addition to being armed with the same crowd control weapons, Marines are extensively trained in close-quarters combat. 'I would expect a defensive response,' he says, 'but not lethal force.' Additional reporting by Alexa O'Brien.
Yahoo
18 minutes ago
- Yahoo
Syngenta group expects minimal impact from U.S tariffs in 2025, executive says
CAMPINAS, Brazil (Reuters) -Agrochemicals company Syngenta Group expects a minimal impact from tariffs imposed by U.S. President Donald Trump on its business in 2025, Steven Hawkins, global president of Syngenta's crop protection business, said on Tuesday. While the company is growing and investing in its portfolio of biological products, these are not a substitute for synthetic crop protections, Hawkins told journalists on the sidelines of Syngenta's One Agro event in Brazil's Campinas, a city in the state of Sao Paulo.
CNBC
24 minutes ago
- CNBC
Wall Street's 'fear gauge' just experienced its third biggest decline ever. What it means going forward
Wall Street's so-called fear gauge recorded a steep slide over recent months. That's good news for investors looking longer term. The CBOE Volatility Index (VIX) has dropped around 35 points over the two months since President Donald Trump rolled back many of his market-roiling tariffs in April. That's the third largest decline in the VIX's history going back to 1990, according to Bespoke Investment Group data, ranking behind periods in late 2008 and mid 2020. .VIX 3M mountain The VIX over the last 3 months As the VIX has retreated, stocks have rebounded significantly from the sell-off seen in the wake of Trump's initial policy unveiling. However, Bespoke noted that stocks' climb of around 20% is relatively small compared to historical performance in the aftermath of slides of this magnitude in the VIX. "Historically, the relationship between the two would suggest a surge of more than 50% over the same period, but stocks are 'only' up 20%," the firm wrote to clients. "That makes this a pretty large outlier between options and the underlying assets they track." Looking ahead, Bespoke said this pullback in the fear gauge can be "bullish" when using a longer time horizon. For example, the largest two-month VIX drops in history have correlated with average moves for the S & P 500 of nearly 6% over the following six months and almost 12% over a year. However, Bespoke warned that traders should be willing to wait, as moves over one and three months are relatively muted. Said another way, investors focused only on near-term action will find a significant tumble in the VIX to be "not very relevant." "In other words, the easy money has been made," Bespoke wrote to clients. "But there could likely be more on the table for patient investors going forward." A short round trip Bespoke isn't the only firm watching the market action following the volatility scare. Essentially, Deutsche Bank said this has been the shortest market plunge on a volatility shock on record. Strategist Parag Thatte said in a note to clients published last week that in a typical volatility-induced jolt, equities take about two months to bottom and then another four or five months to make up losses. This time, however, the stock market has bottomed and clawed back losses in under two months. In past shocks, the S & P 500 would be down close to 10% at this point. But as of midday Tuesday, the S & P 500 is up more than 6% since Trump first announced his plan for broad and steep levies on April 2. .SPX mountain 2025-04-02 The S & P 500 since April 2
