United States Department of Transportation logo and U.S. flag are seen in this illustration taken April 23, 2025. REUTERS/Dado Ruvic/Illustration

By David Shepardson

WASHINGTON, Dec 12 (Reuters) - The U.S. Transportation Department on Friday threatened to pull $73 million in funding from New York state over commercial driver licenses improperly issued to non-U.S. citizens, the latest in a series of Trump administration threats aimed at Democratic-run states.

The department said New York must take actions to address concerns about immigrant truck drivers within 30 days or possibly lose federal highway funding after a federal audit.

The agency in September issued an emergency regulation to drastically restrict commercial driver licenses to immigrants or non-U.S. citizens after a fatal crash in Florida and a government audit. In August, U.S. Secretary of State Marco Rubio said the U.S. was immediately pausing the issuance of all worker visas for commercial truck drivers.

"If we're going to have drivers on American roadways, they need to be the best trained, the best skilled, because if operated incorrectly or inappropriately these are lethal weapons on American roadways," Transportation Secretary Sean Duffy said on Friday.

The New York State Department of Motor Vehicles rejected Duffy's contention, saying New York will continue to comply with federal rules, adding every license "is subject to verification of an applicant's lawful status through federally-issued documents reviewed in accordance with federal regulations. This is just another stunt from Secretary Duffy, and it does nothing to keep our roads safer."

On December 1, Duffy's department said it could withhold up to $30.4 million in federal highway funding from Minnesota over commercial driver licenses issued improperly to non-U.S. residents.

Separately, the Transportation Department removed nearly 3,000 commercial drivers license training providers from a government registry for failing to properly equip trainees earlier this month and said that another 4,000 were on notice for potential noncompliance.

On Tuesday, the department threatened to withhold transit funding for Chicago trains and buses, and demanded more police protection, citing an incident in which a 26-year-old woman passenger was attacked and set on fire last month.

The department previously sent similar letters over concerns about transit issues in New York City and Boston. Chicago, like the other two cities, is heavily Democratic.

President Donald Trump has regularly threatened funding for large cities run by Democrats, including for major infrastructure projects in Chicago and New York.

In October, the U.S. Transportation Department threatened to pull $160 million in federal funds from California over the issue. In November, California agreed to revoke 17,000 commercial driver licenses held by foreigners that the government said were improperly issued, the department said.

The department in October separately withheld $40.6 million in federal transportation funding from California for failing to comply with truck driver English proficiency rules. It said in 2023 that about 16% of U.S. truck drivers were born outside the country.

Late on Friday, California sued the Trump administration to return at least $33 million, saying the federal government made an "arbitrary" decision to withhold that funding.

The state is seeking a court order to rescind all actions terminating the funding and preventing the Transportation Department from redistributing the grants. It was unclear what accounted for the discrepancy between the $40.6 million and the $33 million figure cited by California's lawsuit.

(Reporting by David Shepardson in Washington; Editing by Paul Simao and Christian Schmollinger)