Colorado faces $24M federal funding cut over illegal commercial driver’s licenses

Federal Transportation Secretary Threatens to Withhold $24 Million from Colorado Over CDL Violations

Transportation Secretary Sean Duffy has threatened to withhold $24 million in federal funding from Colorado, citing the state’s allegedly slow response to addressing commercial driver’s license (CDL) violations that breach federal regulations.

In a stern warning issued Monday, Duffy referenced an October nationwide audit that discovered approximately 22% of commercial licenses issued by Colorado to immigrants were done so illegally, with many going to Mexican nationals—a practice explicitly prohibited under federal law.

“Every day that goes by is another day unqualified, unvetted foreign truckers are jeopardizing the safety of you and your family,” Duffy said in a statement that highlighted the urgent nature of the situation.

The Transportation Department has accused Colorado officials of “slow walking” the required purge of these licenses. According to Duffy, the state has failed to complete a full audit, provide a comprehensive accounting of affected drivers, or revoke invalid credentials despite being notified of non-compliance.

Colorado Governor Jared Polis characterized the dispute as a case of “crossed wires” rather than intentional delay. In his response, Polis stated that if Duffy had reached out directly, he would have learned that Colorado has “finished the investigation and we are conducting a final review of the findings, with letters likely going out this week to CDL holders whose credentials were improperly issued.”

The governor added that the state is working expeditiously to revoke these improperly issued licenses, countering the federal accusation of deliberate procrastination.

Beyond the immediate funding threat, Duffy warned that his department possesses the authority to decertify Colorado’s entire CDL program if swift action isn’t taken—a move that would have far-reaching implications for the state’s commercial transportation sector.

The Division of Motor Vehicles in Colorado has already paused the issuance and renewal of term-limited non-domiciled CDLs and commercial learner’s permits indefinitely, according to The Denver Post. This suspension will reportedly remain in effect while officials complete a comprehensive audit of all such licenses to ensure compliance with federal regulations.

Colorado isn’t alone in facing scrutiny. Duffy has issued similar threats regarding federal highway funding to other states as part of a broader effort to ensure commercial vehicle operators meet proper qualifications. New York recently became the fourth Democratic-governed state to be publicly called out, joining California, Pennsylvania, and Minnesota. Republican-led states have not been exempt, with Texas and South Dakota also receiving warning letters from the federal transportation agency.

The nationwide review was launched earlier this summer but gained increased prominence after a tragic incident in August when a truck driver who was not authorized to be in the United States made an illegal U-turn and caused a crash in Florida that killed three people.

Federal officials noted that the regulations being enforced have been in place for years. The audit revealed concerning lapses in oversight, including instances where states may have issued licenses without verifying a driver’s immigration status.

This dispute adds to growing tensions between Colorado’s Democratic governor and the Trump administration. In recent days, the federal government denied disaster declaration requests following wildfires and flooding that affected Colorado earlier this year. Polis also recently criticized the administration’s plans to dismantle a federal climate research laboratory located in the state.

The Transportation Department’s enforcement actions appear to be yielding results in some jurisdictions. Since Duffy began pressing the issue in California, that state has revoked approximately 21,000 commercial driver’s licenses that were determined to have been improperly issued.

Industry experts note that properly vetted and licensed commercial drivers are essential to highway safety, particularly given that commercial vehicles can weigh up to 80,000 pounds and present significant hazards when operated by unqualified individuals.