(This article will be updated as new information comes in).
WASHINGTON — The Trump administration on Wednesday rescinded a pause on federal grant and loan spending.
A federal judge had stayed the ruling until Monday, Feb. 3.
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.
Administration officials said the notice to halt loans and grants was necessary to conduct a review to ensure that spending complies with Trump’s recent blitz of executive orders. Agencies had been directed to answer a series of yes or no questions on each federal program by Feb. 7. The questions included “does this program promote gender ideology?” and “does this program promote or support in any way abortion?”
Still, the vaguely worded 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. Even temporary interruptions in funding could cause layoffs or delays in public services.
Local education, law enforcement and other agencies had been studying the recent announcement of a pause on federal grants and loans that began Tuesday and how it may impact them if the spending freeze remains in place.
The White House announced a pause in federal grants and loans 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, according to the Associated Press.
Administration officials said the decision was necessary to ensure that all funding complies with Trump's executive orders, which are intended to undo progressive steps on transgender rights, environmental justice and diversity, equity and inclusion, or DEI, efforts, the AP reported.
They also said that federal assistance to individuals would not be affected, including Social Security, Medicare, food stamps, student loans and scholarships.
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. State agencies and early education centers appeared to be struggling to access money from Medicaid and Head Start, stirring anxiety with answers hard to come by in Washington, the AP reported.
Court battles are imminent, the AP reported.
The issue dominated the first briefing held by White House press secretary Karoline Leavitt. She said the administration was trying to be "good stewards" of public money by making sure that there was "no more funding for transgenderism and wokeness."
"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 federal Office of Management and Budget.
Democrats and independent organizations described the pause 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."
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."
The Environmental Protection Agency, which distributes billions of dollars, confirmed that it would implement the pause to "align federal spending and action with the will of the American people as expressed through President Trump's priorities."
