President Donald Trump’s attempt to pause federal grants and loans is leaving local nonprofits with an uncertain future as they deal with the fragile state of federal funding.

This comes after a wild week that saw the Trump administration pause federal grants and loans and then reverse course two days later following widespread confusion and legal challenges.

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. Nonprofits experienced chaos as they tried to understand how the change would affect their services and operations.

While the order was reversed, nonprofits across Illinois are still dealing with the destabilizing effects and wondering how reliable federal funding is moving forward.

“We know that even a temporary pause on funding will cause harm because organizations won’t be able to pay their staff, pay their rent, pay their basic expenses,” said Adela Carlin, a senior director of training and community partnerships at Illinois Partners for Human Service.

Many low-income and undocumented people rely on human services organizations for free or low-cost health care, child care, food and housing support. Nonprofits voiced their concern that cuts in federal funding would put marginalized communities at risk.

BrightPoint, a child welfare organization, uses a combination of state, city and federal funding to provide Head Start services. Mario Perez, Brightpoint’s executive vice president and chief operating officer, said support for services like early child care is important not just for low-income families but also for the economy.

“Severing or even threatening to sever government contracts for Head Start impacts small businesses in our communities,” Perez said. “Our parents work in those small businesses, and so for them to not have a place for their child care jeopardizes their ability to work.”

While the Trump administration called off the pause, it doubled down on its effort to review federal funding to ensure agencies comply with new policies against diversity, equity and inclusion initiatives.

Cameron Zelaya, a senior policy analyst at the Illinois Collaboration on Youth, a network supporting youth organizations across Illinois, said his organization relies on federal funding for about 30% of its budget. He said there continues to be concerns about programs being cut because of the populations they serve.

“We know that there’s a possibility that the memo will be brought back,” Zelaya said. “There’s a worry of, ‘Will my program exist tomorrow? Will Trump put that at risk?’”

Marcela Rodriguez, co-executive director at Enlace Chicago, an organization serving Little Village, said the disruption was a wake-up call for those in human services to start preparing contingency plans and developing ways to expand funding sources.

“It’s a scary time,” Rodriguez said. “I don’t think we’re out of danger. The best we can do is be prepared.”

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