Judge Pauses Portion of Trump Freeze on Federal Grants, Loans

A judge on Tuesday afternoon paused part of the Trump administration’s freeze on federal loans, grants and other financial assistance.

The decision is a win for advocacy groups who said the policy would be devastating.

U.S. District Judge Loren AliKhan ordered the Trump administration not to block “open awards,” or funds that were already slated to be disbursed, until at least Feb. 3.

The temporary ruling is intended to “maintain the status quo.” It does not block freezes funding to new programs, or require it to restart funding that has already ended.

AliKhan scheduled another hearing for Monday at 11 a.m. EST to determine the next steps.

The decision caused widespread panic and chaos on Tuesday.

By 2 p.m. PST on Tuesday, organizations and agencies that depend on federal health department funds, including Medicaid, reported they cannot access online system responsible for tracking and depositing their money.

City officials were attempting to ascertain how the pause could impact City funding.

The City receives money from HUD for housing via grants through programs like the Community Development Block Grant (CDBG), Emergency Solutions Grant (ESG), and Home Enhancement Loan Program (HELP).

The National Council of Nonprofits, the American Public Health Association, Main Street Alliance and SAGE earlier on Tuesday sued over the directive issued by the acting head of the U.S. Office of Management and Budget on Monday. It had been set to take effect at 5 p.m. on Tuesday.

The groups said OMB targeted grant recipients based in part on recipients’ rights to free expression and association under the First Amendment. The administration aimed the order at ending “wokeness,” marxist equity, transgenderism, and green new deal social engineering policies.

However, the results were not just impacting progressive groups. Head Start, Meals on Wheels and Medicaid also fell into the cross hairs.

Across the country 24 attorney generals also filed lawsuits to stop the freeze, claiming it could impact people impacted by recent wildfires that decimated Altadena and the Palisades.

Matthew Vaeth, OMB’s acting director, said the money would be put on hold while the administration of Republican President Donald Trump reviews grants and loans to ensure they are aligned with the president’s priorities, including executive orders he signed ending diversity, equity and inclusion programs.