CTA lawsuit over paused funding targets USDOT and FTA

CTA lawsuit over paused funding has reached federal court. The Chicago Transit Authority (CTA) wants money restored without delay. That money was already obligated for two projects. They were the Red Line Extension (RLE) and Red & Purple Modernization (RPM) projects.

CTA lawsuit over paused funding and the federal response

Also, CTA said the lawsuit names the US Department of Transportation (USDOT). It also names the Federal Transit Administration (FTA). Meanwhile, the FTA had previously committed funding for both schemes. That included nearly 2 billion USD in federal grant support for the Red Line Extension. In addition, FTA officials executed Full Funding Grant Agreements for the two projects. The most recent agreement for the RLE was signed on 10 January 2025. Separately, federal funding for both the RLE and RPM was paused in October 2025.

CTA Acting President Nora Leerhsen said:

We are fully committed to the success of these projects, and we will take every step necessary to ensure that they move forward.

The Red Line Extension is an historic investment into the Far South Side of Chicago that will transform public transit and create new economic opportunity for the communities it will serve.

Additionally, our work on the Red and Purple Modernization Project, which is ongoing, has resulted in four new, fully accessible and modern stations. These are both meaningful, impactful projects and we are working closely with community leaders, elected officials and other stakeholders to ensure that both are seen through to completion.

2.1 billion USD funding pause timeline

The lawsuit was filed in federal court in the Northern District of Illinois. It describes harm to residents. It also describes the risk to the project created by the funding pause. Separately, it argues that the USDOT and FTA did not follow their own requirements. Those requirements were statutory and/or regulatory. The point concerns the funding suspensions.

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On 3 October 2025, the White House Office of Management and Budget made the announcement. It formally announced a pause. The move affected 2.1 billion USD. It concerned a Chicago-based infrastructure project, as previously covered by Railway Supply. At the same time, the FTA informed the CTA that it was reviewing the projects.

The CTA said it responded immediately. In addition, it provided more than 1,000 pages of detailed material. This happened on 21 October 2025. This was in response to federal requests. Separately, on 1 December 2025, the USDOT asked for additional information. The CTA then supplied it. It certified its compliance on 10 December 2025.

Red Line Extension and RPM work could stop

Still, the CTA has said the USDOT has not resumed funding since that certification. It also said the USDOT has not communicated with the agency on the issue. In addition, the transit authority said the prolonged pause will threaten progress if it continues. The warning covered both the RLE and RPM projects. It warned that the CTA will be forced to stop work on both projects. That would happen if funding is not restored.

Initial work on the RLE started four years ago. Meanwhile, the RPM is approaching ‘substantial completion’.

For example, work crews have recently been carrying out the following tasks:

• clearing trees;
• demolishing properties;
• removing water lines; and
• carrying out other preparatory work ahead of major construction activities.

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