Administration rescinds memo pausing federal grants, loans and other financial assistance programs

The White House Office of Management and Budget Jan. 29 rescinded a memo it issued two days earlier directing federal agencies to temporarily pause federal grants, loans and other financial assistance programs implicated by President Trump’s recent executive orders. 

Following the rescission of the memo, White House Press Secretary Karoline Leavitt said, “This is NOT a recission of the federal funding freeze. It is simply a recission of the OMB memo…the President’s EO’s on federal funding remain in full force and effect and will be rigorously implemented.” 

The Jan. 27 OMB memo that has been rescinded directed federal agencies to “temporarily pause all activities related to obligation or disbursement of all Federal financial assistance, and other relevant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, including, but not limited to, financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal.”  

The pause was not going to affect Social Security, Medicare benefits, Medicaid or “assistance provided directly to individuals.” 

A federal judge in Washington, D.C., had temporarily halted the pause shortly before it was set to take effect on Jan. 28 at 5 p.m. ET. 

In a separate court case brought by some Democratic attorneys general, U.S. District Judge Jack McConnell said Jan. 29 that even though the OMB memo had been rescinded he was considering blocking the freeze, according to reports. “I fear … that the administration is acting with a distinction without a difference.”