A federal judge in Washington, D.C., has kept a major push to close the digital divide on life support, rejecting the White House’s bid to pull the plug on a nationwide grant program altogether. On Wednesday, U.S. District Judge John D. Bates ruled that the Digital Equity Act’s directive to consider race in awarding grants is unconstitutional but can be severed from the rest of the statute. The upshot: the competitive grant program that pays for local digital navigators, devices and skills training can be revived in a narrower form.
In a written memorandum, Bates concluded that the statute’s race-focused beneficiary language fails strict scrutiny and therefore cannot remain in force, but he held that this flaw does not sink the broader Digital Equity Act, according to Justia Dockets & Filings. He pointed to several nonracial "covered populations" that the law already names, including low-income households, rural communities, older adults and people with disabilities, as constitutionally acceptable bases for handing out funds. The ruling leaves unresolved the central fight over whether the administration acted lawfully when it tried to scrap the competitive grant program, an issue that will be decided as the case moves forward.
The Digital Equity Act carved out roughly $2.75 billion across three tracks: a $60 million planning grant program, a $1.44 billion state capacity initiative and a $1.25 billion competitive grant fund, according to NTIA. That money is intended to cover the basics that keep people connected, including device access, digital skills training and on-the-ground "Digital Navigator" teams that help residents sign up for services and tap online opportunities. For many local nonprofits and city or county programs, the competitive grants were the most direct path to new operating dollars.
One of the clearest early casualties of the administration’s attempted shutdown was the National Digital Inclusion Alliance. Court records show NDIA had been awarded a five-year grant of roughly $25 million but never received the funds after agencies canceled the awards, according to Justia Dockets & Filings. The opinion recounts that the President announced in early May 2025 that he was ending the program and that NIST informed NDIA the next day that the awards were terminated. NDIA’s lawsuit argues the executive branch lacked authority to unilaterally discard a duly enacted statute and its appropriations.
What the ruling means for grantees
The court noted that Justice Department and Commerce officials told Bates they would restart the competitive grant program if the race-based classification were struck from the law, a point emphasized by analysts at the Benton Institute for Broadband & Society. For organizations that saw their awards vanish last year, the decision preserves a clear route to recovery: agencies can revise application criteria to remove the now-invalid race language, reopen funding rounds and reissue awards consistent with the remaining provisions.
Legal implications
Bates anchored his analysis in recent Supreme Court precedent on race-conscious government action and concluded that the Digital Equity Act’s race provision does not survive strict scrutiny, as described in contemporaneous legal reporting from Law360. Because he found the problematic clause to be severable, the court declined to strike down the entire statute and instead left it to federal agencies, and potentially future courts, to sort out how to implement what remains.
What’s next
The NDIA case will press on as the parties litigate remaining claims under the Administrative Procedure Act and related legal theories, while advocates continue lobbying lawmakers and agencies to restore funding and reopen application windows, according to reporting by Nextgov. On the ground, local governments, libraries and nonprofits are being advised to watch for fresh Notices of Funding Opportunity from NTIA along with updated scoring guidance from the Commerce Department.
Advocates are calling the ruling a meaningful, if partial, win for community-level digital inclusion work. Still, getting dollars out the door again will depend on agency rulemaking and follow-through. Groups tracking the funding rollout are being urged to monitor NTIA’s official pages and their state broadband offices for implementation updates and new NOFO postings.
