Senator Baldwin Demands Compliance with Court Order on MBDA Dismantling

The Facts -

  • Senator Baldwin demands Trump administration comply with MBDA court order.
  • Court ruled Trump's order usurped Congress's power, restoring MBDA funds.
  • MBDA vital for minority businesses, accessing $1.5 billion in capital in 2024.


WASHINGTON, D.C. – A cohort of U.S. Senators, led by Tammy Baldwin (D-WI), has pressed the Trump Administration for transparency about its adherence to a federal court's directive from May 13, which prohibited the dismantling of the Minority Business Development Agency (MBDA). This legal action, initiated by 21 states including Wisconsin, seeks to restore the agency's personnel and grantmaking functions.

Contravening congressional establishment and funding of the MBDA, President Trump issued an Executive Order in March aimed at dissolving the agency. Consequently, the Department of Commerce terminated nearly all of the agency's staff and nullified its grant initiatives.

Baldwin, along with other Senators, expressed in a letter to Keith Sonderling, Acting Under Secretary for the MBDA, that, “Twenty-one states sued the Administration, seeking a preliminary injunction to prevent the Administration from carrying out the Executive Order.” They argued that the order violated various constitutional and administrative principles.

The court, supporting the injunction, highlighted that Trump's Executive Order overstepped Congress's fiscal authority by disregarding its allocations and the legislative power to establish or dissolve federal entities.

The Senators further requested the Under Secretary to elucidate on actions taken to comply with the court order, emphasizing the necessity to reinstate the MBDA's workforce and funding capabilities.

Earlier, Senator Baldwin had sought clarity from Sonderling regarding the agency's shutdown. Baldwin also questioned Secretary Lutnick on multiple occasions—on March 25 and April 17—regarding the MBDA's dismantlement, which contradicted his earlier assurances.

The passage of the Minority Business Development Act of 2021 as part of the Infrastructure Investment and Jobs Act cemented the MBDA's permanence and increased its budget and operations. Senator Baldwin played a pivotal role in this legislative success and subsequently secured a new Minority Business Development Center for Wisconsin, backed by a $1.61 million grant.

To access the full letter, click here.

Acting Under Secretary Sonderling, the United States District Court for the District of Rhode Island issued a preliminary injunction on May 13, 2025, in State of Rhode Island, et al. v. Donald J. Trump, et al., mandating that the Department of Commerce stop its illegal disassembly of the MBDA as per President Trump’s Executive Order 14238, “Continuing the Reduction of the Federal Bureaucracy.”

In 2021, bipartisan legislation—the Minority Business Development Act of 2021—permanently authorized the MBDA. This was enacted as part of the Infrastructure Investment and Jobs Act. Congress allocated $68.25 million for the MBDA under the Consolidated Appropriations Act, 2024, continuing through the Full-Year Continuing Appropriations and Extensions Act, 2025 (P.L. 119-4).

Despite Congress’s clear appropriations, President Trump’s Executive Order on March 14, 2025, aimed to dismantle the MBDA. Following this, the Trump Administration terminated nearly all staff, halted grant programs, and removed signage from the Department.

The lawsuit by 21 states argued that the Executive Order breached the Administrative Procedure Act, the Constitution’s Take Care Clause, and the separation of powers doctrine. The court ruled that the states were likely to prevail, leading to the halt of the Executive Order's implementation. The court stated:

“By issuing the [Executive Order]—which effectively directs withholding the funds that Congress recently statutorily appropriated to [MBDA], resulting in the cessation of several of their programs, see supra—the Executive is usurping Congress’s: (1) power of the purse, by disregarding congressional appropriations; and (2) vested legislative authority to create and abolish federal agencies.”

The court’s mandate requires that the MBDA’s personnel and grantmaking functions be restored. The MBDA helped over 12 million minority-owned businesses access more than $1.5 billion in capital and maintain or create about 23,000 jobs in 2024 alone.

The Senators are seeking a report by June 9, 2025, detailing:

  1. Actions taken to halt Section 2 of the Executive Order's implementation.
  2. Steps to reverse policies and directives introduced before the injunction.
  3. Assurances that no further actions have been taken to eliminate the MBDA under the Executive Order.
  4. Measures to restore all affected MBDA employees and contractors to their previous status.
  5. Confirmation of continued grant and contract operations unaffected by the Executive Order.
  6. Efforts to resume and process already-awarded funding.

Additionally, they seek information on addressing potential staffing gaps if terminated MBDA employees cannot return. The online version of this statement is accessible here.

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