Legal battle looms as Trump orders a funding freeze during a review of federal loans and grants
WASHINGTON (AP) — The White House is pausing federal grants and loans starting Tuesday as President Donald Trump’s administration begins an across-the-board ideological review of its spending, causing confusion and panic among organizations that rely on Washington for their financial lifeline.
They also said that federal assistance to individuals would not be affected, including Social Security, Medicare, food stamps and other such programs.
However, the funding freeze could affect trillions of dollars, at least temporarily, and cause widespread disruption in health care research, education programs and other initiatives. Even grants that have been awarded but not spent are supposed to be halted.
Court battles are imminent, and Democratic New York Attorney General Letitia James plans to ask a Manhattan federal court to block the Republican president’s moves.
“My office will be taking imminent legal action against this administration’s unconstitutional pause on federal Funding freeze,” she said on social media.
The pause was scheduled to take effect at 5 p.m. ET, just one day after agencies were informed of the decision.
“The use of Federal resources to advance Marxist equity, transgenderism, and green new deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve,” wrote Matthew Vaeth, the acting director of the Office of Management and Budget.
Democrats and independent organizations swiftly criticized the administration, describing its actions as capricious and illegal because Congress had already authorized the money.
“The scope of this illegal action is unprecedented and could have devastating consequences across the country,” said Sen. Patty Murray of Washington, the top Democrat on the Senate Appropriations Committee. “For real people, we could see a screeching halt to resources for child care, cancer research, housing, police officers, opioid addiction treatment, rebuilding roads and bridges, and even disaster relief efforts.”
Senate Minority Leader Chuck Schumer, a Democrat from New York, called it “more lawlessness and chaos in America.”
It’s unclear from the White house memo how sweeping the pause will be. Vaeth said all spending must comply with Trump’s executive orders,
Vaeth wrote that “each agency must complete a comprehensive analysis of all of their Federal financial assistance programs to identify programs, projects, and activities that may be implicated by any of the President’s executive orders.” He also wrote that the pause should be implemented “to the extent permissible under applicable law.”
Washington is a hub of spending that flows to various departments, local governments, nonprofits and contractors, and the memo has left countless people who are dependent on that money wondering how they will be affected.
“The scope of this illegal action is unprecedented and could have devastating consequences across the country,” said Sen. Patty Murray of Washington, the top Democrat on the Senate Appropriations Committee. “For real people, we could see a screeching halt to resources for child care, cancer research, housing, police officers, opioid addiction treatment, rebuilding roads and bridges, and even disaster relief efforts.”
Senate Minority Leader Chuck Schumer, a Democrat from New York, called it “more lawlessness and chaos in America.”
It’s unclear from the White house memo how sweeping the pause will be. Vaeth said all spending must comply with Trump’s executive orders,
Vaeth wrote that “each agency must complete a comprehensive analysis of all of their Federal financial assistance programs to identify programs, projects, and activities that may be implicated by any of the President’s executive orders.” He also wrote that the pause should be implemented “to the extent permissible under applicable law.”
Washington is a hub of spending that flows to various departments, local governments, nonprofits and contractors, and the memo has left countless people who are dependent on that money wondering how they will be affected.
The pause is the latest example of how Trump is harnessing his power over the federal system to advance his conservative goals. Unlike during his first term, when Trump and many members of his inner circle were unfamiliar with Washington, this time he’s reaching deep into the bureaucracy.
“They are pushing the president’s agenda from the bottom up,” said Paul Light, an expert on the federal government and professor emeritus of public service at New York University.
He also said there are risks in Trump’s approach, especially with so many voters reliant on Washington.
“You can’t just hassle, hassle, hassle. You’ve got to deliver.”
A briefing with White House press secretary Karoline Leavitt, her first, is scheduled for 1 p.m. ET. ____ Associated Press writers Lisa Mascaro, Michael Sisak and Collin Binkley contributed to this report.
Trump administration targets thousands of programs in funding freeze
A new memo from the Office of Management and Budget reveals the potential scope of the Trump administration’s plans to Funding freeze federal. The Trump administration sent a second demand to federal agencies on Tuesday as the White House carries out its sweeping freeze of federal assistance, undermining laws Congress has enacted in recent years.
The White House budget office is circulating a 52-page document ordering agencies to answer 14 questions by the end of next week for each program that “has funding freeze or activities planned through March 15.”
The spreadsheet, obtained by POLITICO, covers thousands of programs, including many that send assistance each month to U.S. households, like food aid to “very low-income” people age 60 and over, the home energy program that helps cover winter heating costs for the poorest households and the WIC program that aids low-income pregnant mothers and babies.
The new directive follows Trump administration movement Monday night toward fulfilling the new president’s initial executive actions ordering the Funding freeze of foreign aid and a broad range of other federal funding. The Office of Management and Budget’s order called for federal agencies to pause all federal assistance that could be targeted under President Donald Trump’s Day One demands.
White House orders freeze on all federal financial assistance
The White House budget office has ordered a pause on all federal grants and loans, according to an internal memorandum sent Monday, potentially impacting trillions in government spending and halting public programs that affect millions of Americans.
Federal agencies “must temporarily pause all activities related to obligation or disbursement of all Federal financial assistance,” White House Office of Management and Budget acting director Matthew Vaeth said in the memorandum, a copy of which was obtained by CNN. The pause also blocks the issuance of new grants.
The memo specifies that the pause will not affect Social Security or Medicare benefits, nor does it include “assistance provided directly to individuals.”
The Funding freeze on federal assistance is slated to take effect at 5 p.m. Tuesday. It marks the latest move by the Trump administration to exert control over federal funding, even that which has already been allocated by Congress.
This temporary pause will provide the Administration time to review agency programs and determine the best uses of the funding for those programs consistent with the law and the President’s priorities,” Vaeth wrote.
The memo suggests that the pause is in line with President Donald Trump’s executive orders last week.
The pause also applies to “other relevant agency activities that may be implicated by the executive orders, including, but not limited to, financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal,” according to the memo.
“Career and political appointees in the Executive Branch have a duty to align Federal spending and action with the will of the American people as expressed through Presidential priorities,” Vaeth wrote.
According to the memo, the budget office “may grant exceptions allowing Federal agencies to issue new awards or take other actions on a case-by-case basis.”
“To the extent required by law,” agencies may also take “certain administrative actions” like closing out grants, it states.
The memo calls on agencies to submit to OMB “detailed information on any programs, projects or activities subject to this pause” by February 10.
Democrats and nonprofits express alarm
Word of the order came Monday evening without further explanation from the Trump administration, leading charities that receive government grants and loans to question which organizations will be affected.
“This order is a potential 5-alarm fire for nonprofits and the people and communities they serve,” Diane Yentel, president and CEO of the National Council on Nonprofits, said in a statement Monday.
“From pausing research on cures for childhood cancer to closing homeless shelters, halting food assistance, reducing safety from domestic violence, and shutting down suicide hotlines, the impact of even a short pause in Funding freeze could be devastating and cost lives,” said Yentel.
The Association of American Universities, which is composed of America’s 71 leading research universities, including Notre Dame and Georgia Tech, said Tuesday it is “still working to assess” the impact of the pause.
Member universities “earn the majority of competitively awarded federal Funding freeze for research that improves public health, seeks to address national challenges, and contributes significantly to our economic strength, while educating and training tomorrow’s visionary leaders and innovators,” the association said.
Sen. Patty Murray of Washington state and Rep. Rosa DeLauro of Connecticut – the top Democratic appropriators in Congress – wrote a letter to the White House on Monday night outlining their “extreme alarm” with the move.
“The scope of what you are ordering is breathtaking, unprecedented, and will have devastating consequences across the country,” the lawmakers wrote. “We write today to urge you in the strongest possible terms to uphold the law and the Constitution and ensure all federal resources are delivered in accordance with the law.”
Senate Minority Leader Chuck Schumer also quickly criticized the pause.
“Congress approved these investments and they are not optional; they are the law,” the New York Democrat said in a statement Monday night. “These grants help people in red states and blue states, support families, help parents raise kids, and lead to stronger communities.”
Schumer added that the action jeopardizes “billions upon billions of community grants and financial support that help millions of people across the country.”
“It will mean missed payrolls and rent payments and everything in between: chaos for everything from universities to non-profit charities,” he said
For More News. Stay Tuned to Internet BuzzFeed