An appeals court on Thursday delivered a blow to President Donald Trump’s efforts to punish “sanctuary” city and state policies, upholding a lower court’s ruling preventing the administration from cutting off federal grant funding.

Attorney General Jeff Sessions threatened last year to cut off Department of Justice (DOJ) grants to cities and counties that thwart efforts by Immigration and Customs Enforcement (ICE) officials to deport criminal illegal immigrants. Chicago sued to keep the DOJ grants flowing into the Windy City’s coffers.

A federal judge last year blocked Sessions from withholding grand money under the Edward Byrne Memorial Justice Assistance Grant (Byrne/JAG) — not only to Chicago but to other affected jurisdictions.

A three-judge panel of the 7th U.S. Circuit Court of Appeals — all appointed by Republican presidents — upheld that ruling, determining that attempts by Sessions amounted to an illegal usurpation of congressional authority.

“The Attorney General in this case used the sword of federal funding to conscript state and local authorities to aid in federal civil immigration enforcement,” Judge Illana Rovner wrote for the court. “But the power of the purse rests with Congress, which authorized the federal funds at issue and did not impose any immigration enforcement conditions on the receipt of such funds.”

Judge Daniel Manion, an appointee of Ronald Reagan, concurred with the decision that Sessions cannot withhold the funds. But he dissented on one point — that the prohibition applies nationwide. The appellate judge wrote that this was an “overstep” of the district judge’s authority.

Dale Wilcox, executive director of the Immigration Reform Law Institute (IRLI), criticized the decision.

“Today’s ruling is yet another step towards the erosion of federalism and adherence to the Supremacy Clause,” he said in a statement. “The result is likely to be a more chaotic nation, where violent crime increases and states can choose which federal laws they want to obey or ignore. This path is dangerous and not in America’s best interests.”

Andrew “Art” Arthur, senior fellow in law and policy at the Center for Immigration Studies (CIS), said he had not read the opinion and could not discuss it in detail. He said it now would be up to the Justice Department to decide whether to appeal again.

“I’m not really 100 percent sure what they’re going to do,” he said. “The next step is they would go to the Supreme Court.”

Who do you think would win the Presidency?

By completing the poll, you agree to receive emails from LifeZette, occasional offers from our partners and that you've read and agree to our privacy policy and legal statement.

The Byrne/JAG program offers funds to local police and sheriff’s departments to supplement their law enforcement missions. Congress established it in 2006, coincidentally the same year Chicago adopted its “Welcoming City” ordinance to curtail cooperation with federal immigration authorities.

Sessions sought to add immigration-related conditions to the grant. That included a commitment by grant recipients to provide ICE agents with notice of the release dates for illegal immigrants in their jails; to provide ICE with access to facilities in order to interview prisoners; and to certify that they are complying with a federal statute that prohibits state and local governments from preventing employees from communicating with ICE.

Those conditions put at risk Chicago’s application for Byrne/JAG funds to expand the use of ShotSpotter technology, which allows officers to quickly identify the locations of shootings.

Related: Sanctuary Cities Stand to Lose $32 Million in Grants for Police

The majority opinion maintains that only Congress can condition the grants on immigration enforcement cooperation. The opinion cites a long list of bills to cut off funding that have been introduced — but failed to pass — and reasoned that the legislative branch had never made that authorization.

In his opinion, Manion indicated that the federal government’s desire for closer cooperation on immigration enforcement is eminently understandable.

“But the reasonableness and soundness of the conditions are not at issue here,” he wrote. “Courts do not (or at least should not) decide legal issues based on the courts’ impression of the propriety of particular policies.”

PoliZette senior writer Brendan Kirby can be reached at [email protected]. Follow him on Twitter.