Federal transportation officials announced Wednesday that California will forfeit $160 million in highway funding after the state delayed the revocation of 17,000 commercial driver’s licenses that federal auditors found were issued unlawfully to immigrants. Transportation Secretary Sean Duffy said the state had promised to complete the revocations by Jan. 5 but instead postponed action until March after immigrant advocacy groups filed a lawsuit.

The penalty escalates a months-long confrontation between the Trump administration and California over commercial driver’s license compliance, with federal officials contending that thousands of noncompliant licenses pose a public safety risk and state officials arguing that the enforcement actions jeopardize road maintenance funding.

Duffy had already withheld $40 million from California over what he said was the state’s failure to enforce English proficiency requirements for commercial truck drivers. He had agreed to drop the threat of the additional $160 million after California said in November it would revoke the problematic licenses.

“Our demands were simple: follow the rules, revoke the unlawfully-issued licenses to dangerous foreign drivers, and fix the system so this never happens again,” Duffy said in a statement. “(Gov.) Gavin Newsom has failed to do so — putting the needs of illegal immigrants over the safety of the American people.”

California DMV spokesperson Eva Spiegel disputed that characterization. “We strongly disagree with the federal government’s decision to withhold vital transportation funding from California — their action jeopardizes public safety because these funds are critical for maintaining and improving the roadways we all rely on every day,” Spiegel said.

Spiegel also said the state complies with all regulations and had positive conversations with Federal Motor Carrier Safety Administration officials about delaying the revocations to allow the agency time to complete its review of California’s commercial driver’s license program.

In the official letter the Federal Motor Carrier Safety Administration sent Wednesday, however, federal officials said they never agreed to the delay after California suggested it and still expected the 17,000 licenses to be revoked by that week.

Federal audit and California’s response

A federal audit found that commercial driver’s licenses for truckers and bus drivers had remained valid long after an immigrant’s visa expired. Some licenses were also issued to citizens of Mexico and Canada who do not qualify. More than one-quarter of the small sample of California licenses that investigators reviewed were unlawful, according to the audit findings.

California notified affected drivers in the fall that they would lose their licenses. But last week the state said it would delay those revocations until March after the Sikh Coalition, a national civil rights group, and the San Francisco-based Asian Law Caucus filed a class-action lawsuit on behalf of the drivers, arguing that immigrant truck drivers were being unfairly targeted.

Federal Motor Carrier Safety Administration Administrator Derek Barrs said California also unilaterally delayed until March the cancellations of roughly 4,700 additional unlawful licenses discovered after the initial group was identified.

“We will not accept a corrective plan that knowingly leaves thousands of drivers holding noncompliant licenses behind the wheel of 80,000-pound trucks in open defiance of federal safety regulations,” Barrs said.

Enforcement followed fatal crashes

The federal government began cracking down on the licenses during the summer, after a truck driver who was not authorized to be in the United States reportedly made an illegal U-turn in Florida in August and caused a crash that killed three people. A second fatal crash in California in October also involved a Sikh driver, according to the Associated Press.

Duffy previously threatened to withhold millions in funding from California, Pennsylvania, Minnesota, New York, Texas, South Dakota, Colorado, and Washington after audits found significant problems, including commercial licenses that had remained valid long after immigrant truck drivers’ work permits expired.

Industry groups and civil rights organizations

Trucking trade groups praised the enforcement effort. Todd Spencer, president of the Owner Operator Independent Drivers Association, said, “For too long, loopholes in this program have allowed unqualified drivers onto our highways, putting professional truckers and the motoring public at risk.”

The driver in the Florida crash and the driver in the October California crash are both Sikhs, a fact the Sikh Coalition said prompted the class-action lawsuit over concerns that Sikh immigrant truckers were being disproportionately targeted.

Immigrants account for about 20% of all truck drivers, according to the Associated Press, but non-domiciled licenses — the category that immigrants can receive — represent about 5% of all commercial driver’s licenses, or approximately 200,000 drivers nationally. The Transportation Department also proposed new restrictions that would severely limit which noncitizens could obtain a license, but a court put the new rules on hold.