Cash-Strapped Blue Cities Stand To Collect Billions From Climate Suits Headed To The Supreme Court

State and local governments are suing energy companies for billions in alleged climate damages while firing employees and slashing budgets as the Supreme Court prepares to weigh their cases.

At least 11 jurisdictions with active or recent climate suits against major energy companies are simultaneously confronting budget gaps, spending cuts, layoffs, or threats to essential services, according to a Daily Caller News Foundation review of budget records. Critics argue the fiscal strain raises the question of what the plaintiff governments stand to gain if the cases survive and that successful suits would hand financially strapped jurisdictions a significant new source of revenue. 

Three of the governments filed their suits within months of pandemic-era budget crises. Democratic Minnesota Attorney General Keith Ellison sued ExxonMobil, Koch Industries and the American Petroleum Institute in June 2020, seven weeks after Minnesota Management and Budget projected the state’s outlook had swung from a $1.5 billion surplus to a $2.4 billion deficit.

Ellison’s office rejected the suggestion that the state’s finances factor into the litigation.

“No. This lawsuit was originally filed more than six years ago,” John Stiles, the attorney general’s deputy chief of staff, told the DCNF.

The day after the Minnesota suit was filed, the District of Columbia filed its consumer protection suit against ExxonMobil, Chevron, BP and Shell — two months after the District’s chief financial officer had projected a $1.5 billion revenue loss that exceeded the city’s entire reserve fund.

In 2026, the District moved to close a projected $1.1 billion budget gap by cutting $469 million in spending and through a series of tax increases as it absorbs roughly 20,000 lost federal jobs, according to the mayor’s budget proposal.

In September 2020, the state of Delaware sued dozens of fossil fuel companies for punitive and compensatory damages, while the state managed a revenue decrease during the pandemic of over $500 million by tapping reserves and canceling planned raises for state employees. In fall 2025, the state faced a new $400 million projected shortfall from federal tax changes before lawmakers moved to close it in a November special session.

Boulder County and the city of Boulder brought their case against Suncor and ExxonMobil in 2018, seeking to make the companies pay for the supposed costs of adapting to climate change.

Eight years later, the county said in August that it must eliminate a further $13.2 million from its 2027 budget after making an equal reduction for 2026. The county has eliminated roughly 90 positions while projecting that it must find $30 million to $40 million in savings over three years. The city of Boulder’s recommended 2027 budget closes a separate $6.3 million gap in part by laying off 13 employees, according to the city.

When contacted, Boulder County and the city of Boulder declined to comment through EarthRights International, the nonprofit legal group representing them in the case, and referred the DCNF to their positions in their court filings.

“The left’s woke lawfare crusade is on full display in the Boulder case,” O.H. Skinner, the executive director of the Alliance for Consumers and a former Arizona solicitor general, said in a statement to the DCNF. “This anti-democratic playbook is how these states and municipalities seek to impose and fund their woke agenda and control the lives of everyday consumers.”

Skinner wrote in a May op-ed for the DCNF that the Boulder case seeks to turn public nuisance law into “a national policy weapon” by giving activists a path to impose policies through local courthouses that they would not be able to pass through legislatures.

On Oct. 5, the Supreme Court will hear Suncor Energy v. County Commissioners of Boulder County, the first argument that the court will hear this fall. Suncor and ExxonMobil argue that federal law governs these claims since greenhouse gas emissions mix globally, so they cannot be confined to Colorado’s borders. A ruling in favor of the companies could end similar ongoing litigation nationwide.

The legal argument underpinning the lawsuits suffered a setback Monday when a federal judge blocked New York’s $75 billion climate superfund law, finding that the Clean Air Act preempts the state’s attempt to impose liability for emissions generated beyond its borders, the same federalism argument that Suncor and ExxonMobil are making before the Supreme Court.

The complaints seek payments for public infrastructure, emergency response, health programs and other climate-related costs that the governments say would otherwise fall on taxpayers, according to Boulder County.

Additionally, San Francisco sued major oil companies for compensatory damages in 2017, at the height of a tech boom that swelled the city’s budget. The city closed a two-year deficit projected at $936.6 million in December, according to a joint reportfrom the mayor’s office, city controller, and board budget analyst. The budget that Mayor Daniel Lurie signed included layoffs, according to KQED.

Multnomah County, Oregon, is seeking more than $51 billion from energy companies over the deadly 2021 Pacific Northwest heat dome. The county closed a $93.2 million gap in the budget it adopted June 5, cutting $67 million from its Homeless Services Department and reducing the district attorney’s office budget, according to the county.

Baltimore pursued its own climate suit for nearly eight years before the Maryland Supreme Court affirmed its dismissal in March, becoming the first state high court in the country to throw out such a case entirely. The city’s own fiscal 2019 budget plan, released weeks before it sued in July 2018, described the spending plan as a response to Baltimore’s “ongoing fiscal challenges.” Chevron’s counsel called the ruling part of a “growing chorus” of climate case dismissals, according to Maryland Matters. City finance officials told the council in May that a harsh winter and public safety overtime pushed Baltimore’s current budget into a $64.4 million deficit, according to The Baltimore Sun.

Minnesota’s Management and Budget office projects a $3.7 billion surplus for the state’s current two-year budget cycle, but warns that a significant structural imbalance remains, with increases in spending outpacing revenue through fiscal year 2029.

Supporters of the litigation say the cases seek to recover climate adaptation costs from companies they accuse of decades of deception, not just to fill general funds, and that many suits were filed years before the current shortfalls emerged. None of the offices contacted said whether recovered funds would be restricted to climate-related purposes or could flow to general funds.

The offices of the San Francisco city attorney, Multnomah County, the Baltimore City Law Department and the attorneys general of the District of Columbia and Delaware, as well as the Center for Climate Integrity, did not immediately respond to the DCNF’s requests for comment.

A decision in the Boulder case is expected to be made by the end of the court’s term, in June 2027, according to SCOTUSblog.