Immigrant rights activists chant outside the governor’s mansion in Austin on May 19 to protest the Texas lawsuit against the Deferred Action for Parents of Americans program. (Jay Janner/AP)

A federal appeals court on Tuesday refused to allow one of President Obama’s signature immigration proposals to move forward, throwing into doubt whether the program will even begin before the president leaves office.

In a split 2-to-1 decision, the U.S. Court of Appeals for the 5th Circuit in New Orleans denied the Obama administration’s emergency request to lift a lower court’s injunction on an initiative to defer the deportations of illegal immigrants and grant them work permits.

Obama announced the program through executive action in November, after House Republicans blocked an effort to pass a comprehensive immigration bill. The president said the federal government does not have resources to remove all of the nation’s 11 million undocumented immigrants and must focus on hardened criminals and potential terrorists.

But Texas and 25 other states sued the administration, calling the move unconstitutional, and U.S. District Judge Andrew Hanen in Brownsville, Tex., ruled in February that the launch of the expanded program should be put on hold until the case is resolved.

The Obama administration sought an immediate stay from the 5th Circuit last month, arguing that the states lacked the legal authority to sue the U.S. government over policies that relate to federal control of the nation’s borders.

The 5th Circuit panel rejected that argument Tuesday. In a 68-page ruling, Judge Jerry Smith stated that Hanen’s injunction will remain in place because the administration is “unlikely to succeed on the merits of its appeal.”

Smith wrote that Texas had successfully established that it would incur a financial burden if it was required to issue driver’s licenses to immigrants who qualified for deportation protections under Obama’s deferred-action program.

“The public interest favors maintenance of the injunction” as the legality of Obama’s immigration programs is decided, Smith wrote in an opinion joined by Judge Jennifer Elrod.

Smith added that the new program goes beyond the law enforcement concept of “prosecutorial discretion,” in which a government with limited resources sets priorities for enforcement. Rather, he wrote, the policy “is the affirmative act of conferring ‘lawful presence’ on a class of unlawfully present aliens. Though revocable, that new designation triggers eligibility for federal and state benefits that would not otherwise be available.”

The appeals court’s ruling was a setback to Obama’s immigration agenda, which the president has held up as a centerpiece of his second term. The administration had planned to begin enrolling newly eligible immigrants this month.

In a statement, Texas Attorney General Ken Paxton called the ruling “a victory for those committed to preserving the rule of law in America. . . . We will continue to fight the brazen lawlessness that has become a trademark of the Obama Administration.”

Despite rejecting the stay request, the 5th Circuit will hear arguments in July on the administration’s underlying appeal of Hanen’s injunction — an argument that could be heard by a different panel of judges. But the 5th Circuit is among the most conservative appeals courts in the nation, and the administration faces an uphill battle.

In the meantime, Hanen has not indicated when he will rule on the central question of whether Obama’s executive actions are constitutional, though he has expressed skepticism about the president’s immigration policies. No matter how Hanen rules, the legal fight is likely to drag on for months on appeal and might not be settled before Obama leaves office in January 2017.

“Today, two judges of the Fifth Circuit chose to misinterpret the facts and the law in denying the government’s request for a stay,” White House spokeswoman Brandi Hoffine said in a statement. She defended Obama’s actions as “fully consistent with the law” and “squarely within the bounds of his authority.”

Obama’s new deferred-action program — which could benefit up to 5 million undocumented immigrants — is modeled after a 2012 initiative that has deferred the deportations of more than 600,000 immigrants brought to the United States illegally as children and granted most of them work permits. The 2012 program is not affected by Hanen’s injunction or the appeals court decision.

Obama said he acted because the federal government has resources to deport about 400,000 immigrants per year and must set priorities for removal. The expanded program would extend to the undocumented parents of U.S. citizens and legal permanent residents, provided the parents have lived in the country for at least five years and have not committed felonies or repeated misdemeanors.

In a dissenting opinion, the third judge on the 5th Circuit panel, Stephen Higginson, wrote that deferred action has been a long-standing and appropriate exercise of the executive branch’s ability to set enforcement priorities.

Such prioritizing “must be decided, presently is being decided, and always has been decided, by the federal political branches,” wrote Higginson, who was appointed to the appeals court by Obama in 2011. Smith and Elrod were appointed by Republican presidents.

Republicans have accused Obama of improperly bypassing Congress, and the issue has become an early flash point in the 2016 campaign for the White House. Most of the GOP candidates have pledged to overturn Obama’s immigration actions, while leading Democratic candidate Hillary Rodham Clinton has strongly endorsed the president’s actions, which have been popular with Latino and Asian American groups.

“We knew since the beginning that this was going to be a tough battle,” Erika Andiola, co-director of the Dream Action Coalition, an immigrant rights group, said in a statement. “Republicans strategically chose this conservative judge [Hanen] whom they knew would delay implementation and try to intimidate our community. We, however, were the ones who pressured the president, knowing it is a constitutional move, and we continue to be confident that we will win at the end.”

But Sen. Orrin G. Hatch (R-Utah) praised the appeals court for upholding Hanen’s injunction, which he said “represents an important victory for those of us who have fought to hold this president accountable to the law and the Constitution.”