U.S. Federal judge temporarily blocks Trump administration freeze on federal grants and loans

Federal judge blocks Trump's push to pause federal funding for ideological review, causing panic and confusion nationwide.

A federal judge on Tuesday (January 29, 2025) temporarily blocked a push from President Donald Trump to pause federal funding while his administration conducts an across-the-board ideological review to uproot progressive initiatives.

The Trump administration plan plunged the U.S. government — and states and organizations that rely on federal funding — into panic and confusion and set the stage for a constitutional clash over control of taxpayer money.

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The order from U.S. District Judge Loren L. AliKhan came minutes before the funding freeze was scheduled to go into effect on Tuesday afternoon. The administrative stay, prompted by a lawsuit brought by nonprofit groups that receive federal funds, lasts until Monday afternoon and applies only to existing programs.

Administration officials said the decision to halt loans and grants — a financial lifeline for local governments, schools and nonprofits — was necessary to ensure that spending complies with Trump’s recent blitz of executive orders. The Republican president wants to increase fossil fuel production, remove protections for transgender people and end diversity, equity and inclusion efforts.

But a vaguely worded memo issued by the Office of Management and Budget, 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.

“This sort of came out of the blue,” said David Smith, a spokesperson for the Shawnee Mission School District in Kansas, one of countless districts that receive federal funding. Now they're trying to figure out what it means “based on zero information.