The Trump administration is moving to withhold nearly $50 million in federal transportation funding from North Carolina after a federal audit found the state illegally issued a majority of its non-domiciled commercial driver’s licenses, putting public safety and federal compliance on a collision course.
According to a Department of Transportation briefing released Thursday, federal inspectors determined that 54 percent of North Carolina’s reviewed non-domiciled CDLs were issued in violation of federal law, triggering a formal ultimatum from Washington.
“North Carolina’s failure to follow the rules isn’t just shameful – it’s dangerous. I’m calling on state leadership to immediately remove these dangerous drivers from our roads and clean up their system,” Transportation Secretary Sean P. Duffy said. “President Trump and I are committed to keeping you and your family safe on our roads.”
The audit, conducted by the Federal Motor Carrier Safety Administration (FMCSA), found that the state issued commercial licenses to foreign drivers whose lawful presence had expired, to applicants who were never eligible to receive non-domiciled CDLs, and in some cases without verifying legal status at all. Federal officials warned that unless the state revokes the illegally issued licenses and halts further non-compliant issuances, funding will be cut.
In a letter sent to Governor Josh Stein and Public Safety Commissioner Paul Tine, federal regulators laid out a corrective roadmap that includes immediately pausing new non-domiciled CDLs, identifying all unlawful licenses still active, and revoking or reissuing them only if they fully meet federal standards.
“The level of noncompliance in North Carolina is egregious,” FMCSA Administrator Derek D. Barrs said, warning that states will not be allowed to leave unqualified drivers operating heavy commercial vehicles.
Local reporting confirmed the stakes. Charlotte-based WSOC-TV reported that North Carolina has 30 days to submit a compliance plan or risk losing the federal funds, with trucking groups praising the enforcement action as overdue.
“For too long, loopholes in this program have allowed unqualified drivers onto America’s highways, creating unnecessary safety risks,” said Todd Spencer, president of the Owner-Operator Independent Drivers Association.
The issue is not isolated. Federal officials noted that North Carolina is the latest state flagged in a nationwide audit launched after President Trump issued an executive order targeting truck driver safety and lax licensing practices. Similar enforcement threats have already been leveled against states, including California and Pennsylvania, with funding restored only after license revocations were carried out.
Fox affiliate MyFox8 reported that the audit and enforcement push follows a series of deadly truck crashes involving improperly licensed drivers, underscoring why the administration has taken a zero-tolerance approach.
“If North Carolina does not fix their serious failures and revoke all illegally issued licenses, the Department will withhold nearly $50 million in federal funding,” the DOT said bluntly.
For North Carolina officials, the message is clear: revoke the licenses, fix the system, or pay the price.
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