LEARN
MORE

Trump Administration Withdraws President Trump’s Freeze on Federal Funding

CATEGORY: Special Bulletins
CLIENT TYPE: Public Education, Public Employers
PUBLICATION: LCW Special Bulletin
DATE: Jan 31, 2025

On January 27, 2025, the President’s Office of Management and Budget (OMB) issued a memo that all Federal agencies must temporarily pause grant, loan, or federal financial assistance that may be implicated by the President’s Executive Orders (EOs). Less than a day after the OMB issued the memo, a federal judge temporarily blocked the pause on federal funding. Then, on January 29, the OMB distributed another brief memo to federal agencies that rescinded the January 27 memo. However, the White House Press Secretary, Karoline Leavitt, posted on the social media platform “X” a statement that only the January 27 memo is rescinded, clarifying that the “President’s Executive Orders on federal funding remain in full force and effect.” She stated that the OMB rescinded the initial memo “to end any confusion created by the court’s injunction.”

The OMB’s January 27 memo caused widespread confusion because it called for federal agencies to temporarily pause all activities related to disbursement of all federal funds without further instruction. On January 28, 2025, the White House issued Q&A Guidance to clarify the scope of the pause on federal assistance. The Q&A Guidance specified that the pause “does not apply across the board” and that “any program that provides direct benefits to Americans is explicitly excluded” such as SNAP, student loans, and Medicaid. The Q&A Guidance also stated that the pause is expressly limited to programs, projects, and activities implicated by the President’s EOs, “such as ending DEI, the Green New Deal, and funding nongovernmental organizations that undermine the national interest.”

The various changes and updates to this pause on federal assistance has caused much confusion and uncertainty among nonprofit organizations and government agencies. Liebert Cassidy Whitmore attorneys are closely monitoring developments related to this Special Bulletin and are able to advise on the effect this could have on your organization.  If you have any questions about this issue, please contact our Los Angeles, San Francisco, Fresno, San Diego, or Sacramento offices.

View More News

Public Education Matters
AB 2375 – School Districts, County Offices Of Education, Charter Schools, And Special Education Local Plan Areas Are Required To Take Steps To Identify Homeless Children And Youths Regardless Of Whether The Agency Receives Federal Funds
READ MORE
Private Education Matters
Private School That Received School Meals From Local Public High School Was Not Recipient Of Federal Funding For Purposes Of Rehabilitation Act Liability
READ MORE