Federal government threatens Minnesota with $30.4 million highway-funding cut over CDL violations

WASHINGTON — The U.S. Department of Transportation (DOT) has issued a stark ultimatum to Minnesota: revoke improperly issued commercial driver’s licenses (CDLs) for non‑U.S. citizens and lawful permanent residents — or risk losing $30.4 million in federal highway funding.

In a letter sent Monday to Governor Tim Walz and the Minnesota Department of Public Safety (DPS), the Federal Motor Carrier Safety Administration (FMCSA) said that one-third of the non-domiciled CDLs it reviewed had been issued in violation of federal regulations.

Audit findings

The DOT outlined several areas of non-compliance:

• Expired lawful presence: Some CDLs remained valid even after the license holder’s authorized stay in the U.S. had expired.
• Lack of verification: Minnesota failed in certain cases to confirm that applicants were lawfully present before issuing non-domiciled CDLs.
• Ineligible drivers: Some licenses were granted to individuals prohibited from holding non-domiciled CDLs under federal law.

The department directed Minnesota to suspend issuance of non-domiciled CDLs, identify unexpired non-compliant licenses, revoke and, if appropriate, reissue compliant licenses, and conduct a full internal review of licensing procedures. The state has 30 days to comply before the DOT begins withholding funds.

State response

Officials at DPS confirmed receipt of the federal letter, saying the state has paused issuance of non-domiciled CDLs and launched an internal review. DPS emphasized that all applicants — domiciled or non-domiciled — pass the same written and behind-the-wheel tests, conducted in English, and argued that previous administrative errors had already been addressed.

Governor Walz described the federal threat as “politically motivated” and warned that withholding highway funds could delay critical infrastructure projects, potentially compromising public safety.

National context

The Minnesota action is part of a broader, nationwide FMCSA audit of state CDL programs. Other states, including California, Pennsylvania, Texas, Colorado, and Washington, have faced similar scrutiny. The agency’s efforts stem from a 2025 executive order targeting CDL compliance and road safety.

Federal and state officials offer contrasting perspectives. Secretary of Transportation Sean P. Duffy framed the enforcement as a critical safety measure, stating that Minnesota had “failed to follow the law and illegally doled out trucking licenses to unsafe, unqualified non-citizens — endangering American families on the road.” Minnesota officials maintain that the state has historically followed federal guidelines and that the licenses in question comply with existing law.

Implications

The threatened funding supports a wide range of state highway projects, from road construction to bridge repair. Although $30.4 million is a fraction of Minnesota’s total federal transportation funding, losing it could delay projects, complicate planning, and intensify political tensions.

For the DOT, the enforcement underscores a commitment to ensure that commercial vehicle operators meet strict legal and safety standards. For Minnesota, the coming weeks will determine whether the state can meet the federal deadline, implement corrective measures, and preserve its federal transportation funding — or face a costly confrontation over immigration, labor, and road-safety priorities.

Sources: U.S. Department of Transportation, Reuters, CBS News Minnesota, FMCSA

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