Trump’s Federal Loan Freeze in Limbo — What to Do If You Expect a Check
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T. Woods
Edited by
Angela Corry
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On Wednesday, Jan. 29, the White House issued a new memo stating that the Office of Management and Budget has not rescinded the original funding freeze order, per AP News.
The White House also stated that President Donald Trump’s executive orders focused on gutting funding from such organizations addressing climate change, diversity and inclusion remain in place, however. This was made explicit by White House Press Secretary Karoline Leavitt, who in a post on X (formerly Twitter) Wednesday stated, “This is NOT a rescission of the federal funding freeze. It is simply a rescission of the OMB memo. Why? To end any confusion created by the court’s injunction. The President’s EO’s on federal funding remain in full force and effect, and will be rigorously implemented.”
The Trump administration sent shockwaves across America on Jan. 28, when it released an ambiguously-worded memo via the Office of Management and Budget announcing that federal grants and loans were being paused — a move that could impact millions of Americans and trillions of dollars.
Per AP News, the pause is to allow the Trump administration time for an “ideological review” to remove progressive initiatives that do not fall in line with the conservative platform he campaigned upon.
However, according to AP, just a few hours after the memo was released, U.S. District Judge Loren L. Ali Khan blocked the pause to federal funding, preventing the funding pause from taking effect until the afternoon of Monday, Feb. 3.
So, what does this mean for you?
What is Being Paused?
Federal loans and grants are what fund everything from local governments to nonprofits to public schools. This includes grants, loans and other aids (which the memo describes as foreign aid, DEI, Green New Deal and “woke gender ideology.”
Why is the Pause Taking Place?
The Trump administration has stated that they wish to ensure all federal grant and loan money is given to organizations and entities compliant with the administration’s ideology and policy, which includes the increased use of fossil fuels, and discontinuing protections for transgender people as well as blocking overall diversity efforts.
A spreadsheet just over 50 pages long was sent to federal agencies and recipients of the funding, asking them to answer a series of questions (examples: “Does this program promote gender ideology?” and “Does this program promote or support in any way abortion?”), with a due date for responses being Friday, Feb. 7.
What Programs Will Not Be Impacted?
Per NBC News, programs that provide assistance directly to Americans — Social Security, Medicare, Medicaid, Head Start, Pell Grants, food stamps, small business assistance and rental assistance — would not be included in the funding freeze and would continue as usual.
There was some initial confusion as to whether Medicaid payments would continue, as Medicaid portals online went down all over America on Tuesday in the wake of the funding freeze news. However, the White House later stated that Medicaid would not be impacted by the funding freeze.
What Should You Do?
Keep in mind, once again: Social Security, Medicare, Medicaid, Head Start, Pell Grants, food stamps, small business assistance and rental assistance will not be impacted by a funding freeze, per the White House.
Additionally, all other recipients of federal funding will continue to receive those funds until at least Monday, Feb. 3. At that point, the block put in place by the federal judge is likely to end, and the freeze will begin unless the Trump administration encounters a significant Congressional block (which is not expected at this time).
If you are expecting a check from an organization that is not exempt, it is recommended that you contact them immediately before the block falls on Feb. 3.
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