- A judge has paused President Donald Trump’s pause of federal grants.
- The directive would have temporarily frozen federal grants to agencies like FEMA and the SBA.
- The judge’s ruling pauses the order until Monday afternoon, protecting funding for existing programs.
A federal judge has temporarily prevented President Donald Trump’s directive to freeze federal grants from taking effect Tuesday evening.
US District Judge Loren L. AliKhan’s decision will protect funding for existing programs until Monday afternoon.
The government’s freeze directive, which caused widespread panic among federal employees when it was announced early Tuesday, would have impacted funding at agencies including FEMA and the Small Business Administration.
The White House did not immediately respond to a request for comment from Business Insider.
AliKhan’s order gives the government until 5 p.m. Thursday to file a response explaining why the funding freeze should be reinstated.
The reprieve was won by a coalition of nonprofit, healthcare, and small business advocacy groups that sued the federal Office of Management and Budget to halt the freeze.
The lawsuit, filed by the National Council of Nonprofits, the American Public Health Association, the Main Street Alliance, and the nonprofit SAGE, said the freeze order was “devoid of any legal basis” and would harm hundreds of thousands of grant recipients who depend on federal grants.
The groups were represented by attorneys for the legal organization Democracy Forward, who said they were grateful for the time “to sort through the chaos created by the Trump administration’s hasty and ill-advised actions.”
“This is a sigh of relief for millions of people who have been in limbo over the last twenty-four hours as the result of the Trump administration’s callous attempt to wholesale shutter federal assistance and grant programs that people across this country rely on,” the statement said.
The National Council of Nonprofits lawsuit was one of two major legal actions filed Tuesday to challenge the threatened funding freeze. The other is being brought by the state attorneys general of New York, California, Illinois, Massachusetts, New Jersey, and Rhode Island.
“The OMB Directive would permit the federal government to rescind already allocated dollars that have been included in recipient budgets — monies that are otherwise necessary for the Plaintiffs to ensure that their residents have quality healthcare, the protections of law enforcement, the benefit of safe roads, and assistance in the aftermath of natural disasters, among many other key services,” the lawsuit states.
The Trump administration had said the freeze would not affect Medicare, Medicaid, student loans, food stamps, or Social Security.
However, during a press conference Tuesday afternoon, New York Attorney General Letitia James said funding for some programs, including Medicaid, had already been frozen.
“Head Start was frozen in Michigan, access to child development block grants were frozen in Maryland,” she said. “At least 20 states have been frozen out of their Medicaid reimbursement systems,
including New York,” she told reporters.
Both lawsuits seek an eventual permanent injunction against the freeze, which the OMB said was necessary to ensure that some $3 trillion in annual spending on federal grants and loans remains compliant with Trump’s recent executive orders.
The federal government would no longer be funding “wokeness” and “the weaponization of government,” the OMB had instructed federal agency heads on Monday.
“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,” the acting OMB director, Matthew J. Vaeth, had told agency heads in a memo ordering the funding freeze.
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