These actions, which take effect at 5 p.m. ET on Jan. 28, are all but certain to be challenged in court.
The Trump administration issued a memo on Jan. 27 that federal funding for grants, loans, and other financial assistance programs is being paused pending review.
Acting Office of Management and Budget Director Matthew Vaeth said in a memo leaked to media outlets that Trump won “a mandate to increase the impact of every federal taxpayer dollar.”
New internal memo from Trump White House budget office: “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” by POTUS pic.twitter.com/PWpBa6gU0r
— Sahil Kapur (@sahilkapur) January 28, 2025
Of the $10 trillion the federal government spent in the 2024 fiscal year, more than $3 trillion was allocated for grants, loans, and other financial assistance, according to Vaeth.
These pauses, which take effect at 5 p.m. ET on Jan. 28, are all but certain to be challenged in court.
What’s Being Paused
The funds being paused include funding to cities that do not apprehend those in the country illegally for that sole purpose, also known as sanctuary cities.
It also applies to funds for nongovernmental entities assisting illegal immigrants and for initiatives related to diversity, equity, and inclusion (DEI).
These moves are based on executive orders President Donald Trump has signed since taking office.
What Other Funds Have Been Paused?
Additionally, funds for both green energy and infrastructure projects and foreign aid will be paused.
“The United States foreign aid industry and bureaucracy are not aligned with American interests and in many cases antithetical to American values,” reads the Jan. 20 executive order calling for an evaluation of U.S. assistance abroad.
“They serve to destabilize world peace by promoting ideas in foreign countries that are directly inverse to harmonious and stable relations internal to and among countries.”
Another Jan. 20 executive order calls for agencies to halt funding under the 2021 Bipartisan Infrastructure Law and the 2022 Inflation Reduction Act. This includes pausing funding for the National Electric Vehicle Infrastructure Formula Program and the Charging and Fueling Infrastructure Discretionary Grant Program.
Federal funding for abortion will also be stopped in accordance with the Hyde Amendment.
Vaeth said in his memo that federal agencies can review pending federal financial assistance awards to ensure administration priorities are carried out. Agencies can modify or withdraw not-yet-published federal financial assistance announcements that conflict with the administration’s priorities, Vaeth wrote, “to the extent permissible by law.”
By Jackson Richman and Lawrence Wilson
