White House Rescinds Order to Freeze $3 Trillion in Federal Grants and Loans

One day a judge instituted a temporary restraining order blocking the implementation of a freeze on $3 trillion in federal grant funding and loans, the White House Office of Management and Budget has rescinded the federal aid freeze, CNN reported on Wednesday.

“OMB Memorandum M-25-13 is rescinded. If you have questions about implementing the President’s Executive Orders, please contact your agency General Counsel,” according to a memo obtained by that network.

Pasadena city officials, and officials across the nation, endured a chaotic and hectic period after receiving the directive from the OMB, as local governments scrambled to understand its implications for their federal funding streams.

At Monday’s City Council meeting Councilmember Rick Cole said the City “was at risk of $60 million worth of federal money being yanked should the current administration make good on its threats already in writing to us.”

On Wednesday, the White House said the freeze was not as sweeping an order as it appeared.

White House aides publicly blamed the media for causing the confusion, arguing that none existed within the building.

According to CNN, the administration had received a flood of calls from lawmakers and state officials with questions about its impact on their home states.

The freeze was aimed at federal resources being used for “Marxist equity, transgenderism, and green new deal social engineering policies.”

However it ended up affecting programs from housing assistance to meals for seniors.

California Attorney General Rob Bonta announced the state would lead a coalition of 24 state attorneys general challenging the order, which he termed “reckless, dangerous, unprecedented in scope and devastating in its intended effect.”

While some programs received exemptions in the OMB order, at least on paper, including Social Security, Medicare, and disaster relief for the recent Eaton Fire, crucial local services like Community Development Block Grants and Emergency Solutions Grants remained in limbo during the chaos.

Pasadena receives grant money from the Department of Housing and Urban Development, including the Community Development Block Grant (CDBG), Emergency Solutions Grant (ESG), and Home Enhancement Loan Program (HELP), which provide vital housing assistance to city residents.

The situation reached a crisis point by Tuesday afternoon, as

organizations nationwide reported being locked out of federal payment systems, including those handling Medicaid reimbursements and other critical funding streams like the First Start childhood education program.

Relief came at 1:00 p.m. Tuesday when U.S. District Judge Loren AliKhan in Washington, D.C. issued a temporary restraining order blocking the administration from freezing “open awards” until at least February 3 at 5 p.m.

AliKhan was scheduled to preside over a Monday, Feb. 3 at 11 a.m. EST hearing on whether the freeze, in whole or in part, may proceed.