GAO: 796 federal awards worth $17.8 billion were canceled

A Government Accountability Office review found that four federal agencies reported canceling 796 awards worth about $17.8 billion under the Infrastructure Investment and Jobs Act and Inflation Reduction Act. Another 2,528 awards worth about $33.6 billion had no final decision in the agency data GAO reviewed.

The report, published July 22, 2026, does not mean that most of the infrastructure, broadband and clean-energy funding was canceled. The agencies reported approving about 9,500 awards worth roughly $128 billion. GAO’s detailed review table lists $122.8 billion across 8,739 approved awards, plus modified awards that continued with changed terms or amounts.

The findings cover the Environmental Protection Agency, Department of the Interior, Department of Transportation and the Commerce Department’s National Telecommunications and Information Administration. Together, the four agencies received $628.4 billion in combined IIJA and IRA budget authority available during all or part of fiscal years 2022 through 2025. GAO said separate reports on the Department of Energy and Department of Agriculture are forthcoming.

What agencies reviewed

Beginning in January 2025, executive orders directed agencies to review IIJA and IRA funding for consistency with administration priorities. GAO found that agencies developed different processes, including searches for terms appearing in executive orders, such as “diversity” and “environmental justice.”

After review, awards could be approved without modification, modified with different terms or amounts, canceled, or left pending. GAO said senior agency leadership made final decisions, based on agency documentation and officials’ accounts.

GAO’s cancellation category is broader than a simple termination. It includes terminated awards, awards rescinded by law, previously announced awards that were withdrawn or retracted, and awards discontinued by recipients. The report does not characterize every canceled award as waste, fraud or an illegal action.

EPA and DOT accounted for most canceled dollars

EPA and DOT accounted for $16.4 billion, or more than 90%, of the canceled dollars reported by the four agencies. GAO said EPA’s Solar for All program accounted for about $7 billion, or roughly 39%, of the canceled total.

The largest unresolved pocket involved EPA’s Greenhouse Gas Reduction Fund. EPA announced on March 11, 2025, that it had terminated nearly $20 billion awarded to eight entities under the National Clean Investment Fund and Clean Communities Investment Accelerator programs.

GAO nevertheless counted that money as pending rather than definitively canceled. The agency’s records showed the grants as fully obligated as of March 2026, while litigation continued and undistributed funds remained frozen at the private bank serving as the programs’ financial agent. EPA says the grants were terminated; GAO said the final status was unclear in the records it received.

EPA has cited concerns about self-dealing, conflicts of interest, unqualified recipients and reduced oversight as its rationale for the termination. Those are EPA’s stated allegations and rationale, not independent findings established by GAO in this report. A separate EPA inspector general audit examined Solar for All and identified implementation and oversight issues, but it does not by itself resolve the broader GGRF dispute.

Why the totals are easy to misread

GAO cautioned that its review-status totals are not a single-day snapshot. The agencies supplied status information from different dates ranging from June 30, 2025, to February 25, 2026. The report found 796 canceled awards worth $17.8 billion and 2,528 pending awards worth $33.6 billion as of those varying dates.

The report also separates budget authority, obligations and disbursements. Budget authority is the amount Congress made available. An obligation is a legal commitment by the government to pay for an award or other authorized activity. A disbursement is the payment of that obligation.

For fiscal years 2022 through 2025, the four agencies obligated about 76% of their IIJA funding and disbursed about 54% of the obligated amount. For IRA funds at EPA, Interior and DOT, about 72% was obligated and about 60% of obligated funds was disbursed. Agency data also showed that Congress rescinded $6.4 billion in unobligated IRA funds in July 2025.

DOT’s June 30, 2026 funding update illustrates the difference. DOT reported about $510.8 billion in IIJA grants announced, $402.3 billion obligated and $244.7 billion outlayed. In other words, a public grant announcement is not the same as a binding federal commitment, and an obligation is not the same as cash already paid to a recipient.

That distinction matters for states, local governments, nonprofits and contractors. A project can be announced but not yet obligated, obligated but not fully paid, or placed under review before a recipient can confidently plan procurement, staffing, construction or expected services.

What the uncertainty means for recipients

States and local governments should confirm the status of each award with the responsible agency rather than rely on a broad program label. Nonprofits and contractors should check whether an award is approved, modified, obligated, outlayed, canceled or still pending, because each status can carry different consequences for contracts, hiring, financing, equipment purchases and project schedules.

The $33.6 billion pending figure should not be read as money definitively lost. It means that, in the agency data provided to GAO, no final decision had been reported. The outcome may differ by program, award document, litigation status and later agency action.

What happens next

Further developments are likely through agency status updates, congressional oversight and court proceedings involving EPA funds. GAO also said it plans separate reports on IIJA and IRA funding at the Department of Energy and Department of Agriculture, which were not included in this review.

Sources

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