A federal judge has ordered the U.S. Department of Agriculture to restore more than $4.3 million in grants awarded to two Iowa nonprofit organizations after ruling they were likely unlawfully canceled under the Trump administration.

The June 30 ruling by U.S. District Judge Beryl Howell reinstates funding for Iowa Valley Resource Conservation & Development (RC&D) in Amana and the Sustainable Iowa Land Trust (SILT) in West Branch. The organizations joined a federal lawsuit challenging USDA’s decision to terminate nearly all grants awarded through the Increasing Land, Capital and Market Access Program.

The Iowa grants include nearly $2.5 million for Iowa Valley RC&D’s New Century Farm project at the Johnson County Historic Poor Farm and approximately $1.8 million for SILT’s efforts to help beginning farmers obtain affordable farmland.

USDA canceled 49 of the program’s 50 grants in March, eliminating roughly $300 million in funding nationwide.

In her ruling, Judge Howell concluded the plaintiffs were likely to succeed because Congress specifically created the program to improve land access for socially disadvantaged and beginning farmers. “Defendants cannot terminate a grant for the very reason that the grant satisfies Congress’s mandate,” Howell wrote.

Court filings indicate USDA’s own internal appeals office found the cancellations were based not on the merits of individual grants, but on broader agency policy decisions after the administration ended the Land Access Program.

Iowa organizations rebuilding after abrupt shutdown

Although the grants have been reinstated, Iowa organizations say the damage has already been done. Jason Grimm, executive director of Iowa Valley RC&D, said the organization had already laid off employees and suspended its beginning farmer fellowship after the grant was terminated in March.

The fellowship hired beginning farmers while providing hands-on training in operating a successful farm business. Grimm said several participants had left other jobs to join the program before funding was unexpectedly withdrawn.

While USDA has informed grant recipients their contracts have been restored, Grimm said rebuilding the program will take months, and uncertainty remains because the federal government could appeal the decision.

SILT officials reported that private donations allowed some work to continue during the funding interruption, but collaborative projects, including educational resources and a mini-grant program designed to help beginning farmers secure affordable farmland, were placed on hold.

Both organizations say they remain cautious about expanding programs until the legal dispute is fully resolved.

Our Take

This case illustrates an important constitutional principle: Congress writes the law, while executive agencies are responsible for carrying it out.

Judge Howell’s ruling was not simply about agricultural grants. It addressed whether an executive agency may terminate a congressionally authorized program because it no longer aligns with a new administration’s policy priorities.

Court filings indicate the administration viewed the Land Access Program as inconsistent with its broader efforts to eliminate programs associated with diversity, equity, and inclusion (DEI) initiatives.

But the court found that Congress intentionally created the program to assist beginning and historically underserved farmers. An administration may establish new priorities, but it cannot simply disregard a law enacted by Congress because it disagrees with its purpose.

For Iowa, the consequences were tangible. Beginning farmers lost opportunities, nonprofit organizations laid off employees, and valuable agricultural programs were interrupted, despite a court later concluding the grants were likely terminated unlawfully.

The case serves as a reminder that policy debates have real-world consequences, particularly for rural communities. It also reinforces the constitutional role of the courts in reviewing whether executive actions remain within the authority granted by Congress.