Politics

Donald Trump White House Rescinds Memo Freezing Federal Grants After Confusion, Lawsuits

An order from President Donald Trump’s budget office on Wednesday rescinded a memo to freeze spending on federal grants, less than two days after it sparked confusion and legal challenges, according to two people familiar with the matter.

Illinois was one of 22 Democratic-led states that filed suit Tuesday asking a federal court to block the sudden pause on funding, which was announced Monday evening. The freeze threatened to hold up trillions of dollars in funding for basic government functions like health care, infrastructure and support for children and veterans.

The White House confirmed that OMB pulled the memo Wednesday in a two-sentence notice sent to agencies and departments but said that Trump’s underlying executive orders targeting federal spending in areas like diversity, equity and inclusion and climate change, remained in place.

A memo issued by the White House’s acting budget director Monday instructed federal agencies to pause “disbursement of all Federal financial assistance,” and directs agencies to conduct an analysis to ensure that spending in line with Trump’s edicts to end “wokeness” and to make government more efficient.

But the vague wording of the memo, combined with incomplete answers from the White House throughout the day, left lawmakers, public officials and average Americans struggling to figure out what programs would be affected by the pause.

On Tuesday afternoon, just before the funding freeze was scheduled to take effect, a federal judge issued a temporary stay that was to last until Monday afternoon. The order from U.S. District Court Judge Loren L. AliKhan came in response to a separate suit from the National Council of Nonprofits.

“The Executive Orders issued by the President on funding reviews remain in full force and effect and will be rigorously implemented by all agencies and departments,” White House press secretary Karoline Leavitt said, blaming the confusion on the courts and news outlets, not the administration. “This action should effectively end the court case and allow the government to focus on enforcing the President’s orders on controlling federal spending."

Administration officials insisted that despite the confusion, the order still had its intended effect by underscoring to federal agencies their obligations to abide by Trump’s executive orders.

During a digital news conference announcing the suit filed by 22 Democratic attorneys general, Illinois Attorney General Kwame Raoul and his colleagues characterized Trump’s move as unconstitutional and harmful.

“On Jan. 20 our nation had a peaceful transfer of power. But let’s be clear. Jan. 20 was an inauguration, not a coronation,” Raoul said. “Congress is given the power to appropriate the funding. The executive branch cannot unilaterally disregard those appropriations passed by a separate and equal house of government.”

The Democrats characterized the action as being outside constitutional presidential powers.

“We won’t stand by while the president breaks the law and oversteps his authority,” California Attorney General Rob Bonta said.

Raoul on Tuesday said the near blanket funding stop would have a “devastating impact on the public safety, prosperity and quality of life.”

He said his office could have issues going after sex offenders and child predators, because the funding pause impacts its Internet Crimes Against Children task force, as well as funding that “allows our law enforcement partners to fight crime.”

California expected it would result in delayed disaster aid for Los Angeles wildfire recovery efforts, California Attorney General Rob Bonta said.

“What was proposed would be devastating,” Illinois Gov. J.B. Pritzker said, for all states — not just Illinois, and not just those in Democrats’ control. “We rely on so many things, just for daily living. And veterans’ services that would be cut off. HeadStart programs and childcare support that would be cut off.”

Pritzker, in Wednesday remarks made before the reversal was announced, said he believes the Trump administration received the message that it was a “bad idea.”

“Fine, review all the programs, let’s make sure we’re doing it efficiently and effectively,” Pritzker said. “But don’t shut off the programs while you’re reviewing them.”

The governor made the comments in Jerseyville, in downstate western Illinois, where Trump won 74% of the vote — the same percentage that Pritzker’s Republican opponent, Darren Bailey, won in their 2022 gubernatorial contest.

Asked by the reporter about whether Illinois could be subject to disproportionate federal cuts because voters favored Democratic nominee Kamala Harris in November, Pritzker said he’s “upset” by the notion that Trump will punish states that didn’t support him by withholding money, grants and other federal support.

“I know that there are areas of the state that I didn’t win, that it’s my responsibility nevertheless to build business opportunities and help education systems grow,” Pritzker said. “Do I think this president will take out his revenge against states that didn’t vote for him? All I can say is, I hope not and I’m going to try like heck to make sure that they don’t.”

The Associated Press contributed. 

Contact Amanda Vinicky: @AmandaVinicky | [email protected]

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