(The Center Square) – States, universities, nonprofits and lawmakers were left confused Tuesday after a memo from the White House paused federal grants, loans and other financial assistance-programs, until the new administration can review them.
The White House’s two-page memo is at the center of the confusion.
“To the extent permissible under applicable law, Federal agencies must temporarily pause all activities related to obligation or disbursement of all Federal financial assistance, and 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,” the memo said.
It noted that voters gave President Donald Trump “a mandate to increase the impact of every federal taxpayer dollar.”
“Financial assistance should be dedicated to advancing Administration priorities, focusing taxpayer dollars to advance a stronger and safer America, eliminating the financial burden of inflation for citizens, unleashing American energy and manufacturing, ending ‘wokeness’ and the weaponization of government, promoting efficiency in government, and Making America Healthy Again,” the memo said. “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.”
White House Press Secretary Karoline Leavitt answered questions about the memo during a news conference Tuesday afternoon. She clarified that the pause on federal aid and grants announced Monday night would not affect federal assistance programs that directly serve people, including Social Security, Medicare and welfare benefits, and the Supplemental Nutrition Assistance Program, formerly known as food stamps.
“So, what does this pause mean? It means no more funding for illegal DEI programs. It means no more funding for the green new scam that has cost American taxpayers tens of billions of dollars. It means no more funding for transgenderism and wokeness across our federal bureaucracy,” Leavitt said.
Confusion persisted.
University of Chicago Provost Katherine Baicker told researchers to pause spending.
“We are requesting that all University researchers working on federal grants temporarily suspend their non-personnel spending on federal grants as much as possible during this period of substantial uncertainty,” she wrote in a memo to staff. “For example, do not make any additional spending commitments, purchase new supplies or equipment, start new experiments, embark on funded travel, etc.”
Baicker said university officials are waiting for more guidance.
“This is not a request that I make lightly. The research enterprise is at the core of our University’s mission and is of profound importance to the daily work of our faculty, researchers, staff, and students,” she wrote. “I also know that this is insufficient guidance and that you must have many questions (as do I). I wish that I had more information to share now, but will continue to be in touch as we learn more,” she said. “But we must for now proceed under the assumption that grant expenditures incurred after today while this memorandum is in effect may not be covered by federal funding.”
The OMB memo prompted Wisconsin Gov. Tony Evers, a Democrat, to write a letter to Trump seeking immediate guidances on the order.
“With very few details and specifics available, virtually no time for ample review and consideration, and no direct communication to date, states are left to plan for the worst, and Wisconsinites and millions of Americans who are rightfully alarmed and concerned by this unprecedented decision are left scrambling,” Evers wrote. “These benefits and investments – many of which were undoubtedly approved with bipartisan support by the U.S. Congress – are the law. Although we may disagree on many issues, we should be able to agree that following the law is critically important.”
U.S. Rep. Tom Emmer, R-Minn., told reporters that Trump was doing what he was elected to do.
“You’re going to see things like this, and your first reaction is going to be, ‘Well, this isn’t the way it’s been done,'” Emmer said. “You need to understand, he was elected to shake up the status quo.”
Senate Appropriations Committee Vice Chair Patty Murray, D-Wash., and House Appropriations Committee Ranking Member Rosa DeLauro, D-Conn., warned of “devastating consequences” in a letter to Acting Office of Management and Budget Director Matthew Vaeth.
“The scope of what you are ordering is breathtaking, unprecedented, and will have devastating consequences across the country,” they 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.”
National Council of Nonprofits President and CEO Diane Yentel said the White House memo could have far-reaching implications, especially for nonprofits.
“This order is a potential five-alarm fire for nonprofit organizations and the people and communities they serve. From pausing research on cures for childhood cancer to halting food assistance, safety from domestic violence, and closing suicide hotlines, the impact of even a short pause in funding could be devastating and cost lives,” she said in a statement. “This order could decimate thousands of organizations and leave neighbors without the services they need.”
The spending freeze takes effect at 5 p.m. Tuesday. Agencies have until Feb. 10 to submit information on any programs subject to the suspension.
“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,” the memo noted. “Even before completing their comprehensive analysis, Federal agencies must immediately identify any legally mandated actions or deadlines for assistance programs arising while the pause remains in effect. Federal agencies must report this information to OMB along with an analysis of the requirement. OMB also directs Federal agencies to pause all activities associated with open [Notices of Funding Opportunities], such as conducting merit review panels.”
