OMB chief Russ Vought pauses $2.1B in Chicago metro funding over DEI concerns

WASHINGTON — Chicago became the second major US city to have billions of dollars in federal funding for infrastructure projects paused on Friday, as the Trump administration seeks to root out purported DEI contracts amid the government shutdown.

“$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,” announced Office of Management and Budget Director Russ Vought on X.

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Illinois Gov. JB Pritzker responded in a statement, “At a time when federal agents are sowing chaos in Chicago, the Trump administration is holding bipartisan funding hostage.”

“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,” Pritzker added.

Chicago Mayor Brandon Johnson fired back at Vought on X: “Argentina gets $20 billion and the South Side gets nothing. What happened to America First?”

Treasury Secretary Scott Bessent recently announced the US would make the multibillion-dollar swap line available to President Javier Milei’s government to stabilize Argentina’s markets.

The OMB move came after New York City had $18 billion for the Second Avenue subway and Hudson Tunnel frozen on Wednesday, so the US Department of Transportation could review whether any of its funding for the projects is going toward unlawful DEI initiatives.

“Illinois, like New York, is well known to promote race- and sex-based contracting and other racial preferences as a public policy,” the Transportation Department said in a statement, citing a PBS report that the Chicago Transit Authority has spent roughly a fifth of its metro modernization funding on contracts with firms designated as so-called Disadvantaged Business Enterprises (DBEs).

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“The American people don’t care what race or gender construction workers, pipefitters, or electricians are. They just want these massive projects finally built quickly and efficiently,” the DOT added in its release.

“Secretary [Sean] Duffy and USDOT are committed to conducting these reviews as fast as possible so reimbursements can move forward. 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 DOT published an interim final rule Friday that “removes race- and sex-based presumptions of social and economic disadvantage that violate the U.S. Constitution” from its DBE program.

In New York’s case, it’s unclear which discriminatory practices may have been affecting contracted work on the infrastructure projects, though The Post exclusively reported last month on a civil rights complaint alleging the one-fifth of its contracts for minority-owned businesses.

Federal Transit Administration chief and former New York Congressman Marc Molinaro informed MTA chairman Janno Lieber and Gateway Development Commission CEO Tom Prendergast of the changes on Sept. 30.

“They’re trying to make culture wars the reason why,” New York Gov. Kathy Hochul argued when asked by reporters Wednesday about the funding hold. “We’re ready to build. It’s underway, and now we realize that they decide to put their own interpretation of proper culture ahead of our needs, the needs of the nation.”