Trump administration threatens to rescind $32 million promised to Denver by FEMA for migrant shelter costs

The Federal Emergency Management Agency in a letter to Denver this week threatened to withhold millions of dollars in promised grant money over accusations that officials misused it to shelter migrants.

The letter is part of an initiative by President Donald Trump’s new administration to review cities and organizations across the country that have helped undocumented migrants in recent years, suggesting they may have violated a law used to prosecute smugglers. FEMA is also asking for detailed information on the people they helped.

Denver city officials are “currently reviewing” the letter, according to a statement from spokesperson Jon Ewing. More than $30 million in FEMA awards to Denver in the last two years could be at stake, according to federal records.

“Denver has committed no violation and will continue to comply with local, state, and federal laws,” he wrote.

Denver provided temporary shelter to migrants after about 43,000 people arrived in the city on buses from border states beginning in late 2022, including many sent by Texas Gov. Greg Abbott. Denver closed all of its migrant shelters last year.

The U.S. Department of Homeland Security has “significant concerns” that federal grants awarded under FEMA’s Shelter and Services Program were used for illegal activities, according to the letter written by Cameron Hamilton, acting administrator of FEMA.

The program, which Congress authorizes, directs FEMA to support non-federal entities that are sheltering “noncitizen migrants following their release from the Department of Homeland Security.”

FEMA awarded about $650 million through the program in 2024, including to Washington, D.C., Chicago, New York City, Philadelphia and Massachusetts.

Denver has been promised about $32 million in grant dollars through the program between 2023 and 2024, according to FEMA’s website.

“DHS/FEMA may place a hold on funds until the matter is corrected, or additional information is provided,” according to the letter.

Because the grants are designed as reimbursements, the city hasn’t yet received the majority of the dollars it was allocated. Federal FEMA grants typically take years to receive, meaning that while the rescinding of the money could impact the city’s budget in the long term, it would be unlikely to cause an immediate blow, Ewing said.

The letter asks the city to provide, within 30 days, names and contact information for migrants who were served, along with “a detailed and descriptive list of specific services provided,” according to a copy of the letter obtained by The Denver Post. Cities are already required to provide some information, including the names of people they help, as part of the grant’s process, Ewing said.

The letter doesn’t explicitly threaten criminal prosecution, but it accuses the cities of violating the U.S. Criminal Code Section 1324, which makes it a felony to smuggle, transport or conceal “unauthorized aliens.”

That is the same statute that members of Congress recently referenced when threatening to refer Denver Mayor Mike Johnston and other mayors for prosecution for their cities’ policies when they testified to the U.S. House Committee on Oversight and Government Reform.

In that hearing, Johnston said Denver was faced with a crisis when he was sworn into office in 2023.

“At one point we were receiving 10 to 11 buses a day — dropping off as many as 300 people, mostly women and children — in 10-degree weather with only sandals and a t-shirt, leaving them in danger of freezing to death,” he said.

This week, federal prosecutors delivered subpoenas to shelters in New York City that have been used to house migrants, in part using money from FEMA.

FEMA has not responded to a request for comment.

The Associated Press contributed to this story.