CHICAGO — Illinois and 11 other states sued the Trump administration over its move to withhold potentially hundreds of billions of dollars in grant funding from states that refuse to comply with the Trump administration’s definitions of sex and gender.

President Donald Trump, on the first day of his second term, issued an executive order instructing federal agencies to recognize only a person’s sex assigned at birth. It disregarded the concept of gender identity as a “false claim,” dismissing the self-identification of any individual who does not conform to the administration’s definition of sex.

The administration now says states and other entities that don’t comply with that executive order will be ineligible for billions of dollars in federal grant funding allocated through the U.S. Department of Health and Human Services for health education in public schools, medical research and workforce development programs that train medical professionals on topics including rural health, addiction treatment and senior health.

Illinois, for example, allows its residents to change the sex on their birth certificate by signing a statement affirming their gender designation or intersex condition.

In their lawsuit, the states called the latest Trump directive “a novel and ambiguous funding condition.”

“The Trump administration is attempting to hold billions of dollars hostage in an attempt to force states to exclude and discriminate against people who are transgender,” Illinois Attorney General Kwame Raoul said in a statement. “Everyone deserves to live authentically, and I will continue to push back against the administration’s repeated and cruel attempts to erase transgender Americans.”

Trump’s order further directed federal agencies to remove all statements and policies that were inclusive of other gender identities and to take all necessary and legally permissible steps to end funding that promotes alternate definitions of sex and gender.

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In their lawsuit, the states alleged the administration’s purpose was “to exclude transgender, intersex, non-binary and gender-diverse individuals and make denial of their existence official policy.”

Title IX

HHS has long required states to certify compliance with Title IX of the Education Amendments of 1972, the landmark civil rights law passed to prevent sex discrimination in federally funded education programs, including in sports.

The new condition, however, compels states to adhere not only to Title IX requirements, but also to the Trump order. States argued HHS does not have the authority to impose new requirements on congressionally allocated spending.

“Congress has funded these programs without any requirement to exclude entities that recognize transgender, nonbinary, intersex or gender diverse individuals,” the states wrote.

The states argued that, due to the vagueness of the order, HHS’s new condition would also potentially open them up to civil and criminal liability under the False Claims Act, a federal statute that makes it illegal to knowingly present a false or fraudulent claim when applying for federal funds. Even if they wanted to comply, states said, there are not clear guidelines to do so.

The order, states argued, is inconsistent with other official HHS policies. The website for HHS’s own Office for Civil Rights as of Wednesday afternoon outlined past Supreme Court decisions which established precedent for the prohibition of discrimination on the basis of gender identity.

“OCR will interpret Section 1557’s prohibition on discrimination on the basis of sex to include: (1) discrimination on the basis of sexual orientation; and (2) discrimination on the basis of gender identity,” the website states.

Compliance with the federal order would also put Illinois in violation of the state’s Human Rights Act, which provides protections against gender-based discrimination in employment, housing and schools.

The states have asked the court to find the HHS policy unlawful and block its enforcement.

A pattern of threats

The administration has made a pattern of threatening to withhold funds to punish Democrat-led states like Illinois that do not fall in line with federal policies on issues from gender-affirming care to immigration protections.

Illinois joined a separate multi-state lawsuit in August seeking to block Trump’s executive orders that prohibited gender-affirming care for young people, and another in December that threatened Medicaid and Medicare funding for hospitals providing the care.

It further directed federal agencies to remove all statements and policies that were inclusive of other gender identities and to take all necessary and legally permissible steps to end funding that promotes alternate definitions of sex and gender.

The order’s purpose, the states alleged, “is to exclude transgender, intersex, non-binary and gender-diverse individuals and make denial of their existence official policy.”

Raoul has won other similar suits against the Trump administration, including over a Trump order which directed the Federal Emergency Management Agency to withhold federal emergency funding from Illinois over the state’s immigration laws. A judge ruled in September that it was unconstitutional for federal agencies to withhold disaster relief funding simply because a state’s laws differ from federal ones.

This week, the state sued the feds alleging that their aggressive immigration enforcement campaign in the Chicago region is part of an “organized bombardment” of the state aimed at forcing capitulation on immigration policies.

The December lawsuit challenging the administration’s regulations on Medicare and Medicaid put implementation of the policy on hold, at least until mid-April while the case is ongoing.

The administration has demonstrated, though, that it will not hesitate to pull funds.

Late Tuesday night, the administration cut an estimated $2 billion in funding nationwide for nonprofit groups that provide health services to people experiencing addiction, homelessness and mental health challenges. But by Wednesday, the administration had reversed the decision, leaving providers confused.

A letter announcing the change said federal officials “no longer believe the defunded programs align with the Trump administration’s priorities,” according to NPR.

Capitol News Illinois is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.