White House Rescinds Federal Aid Freeze In PA

Update, Wednesday, 1:36 p.m.: A federal aid freeze announced this week by the Trump Administration has been rescinded, multiple sources are reporting Wednesday afternoon.

CNN reported that it has obtained a memo from a Trump administration official communicating that the freeze is rescinded. That memo was also shared by state officials in New Jersey.

The New York Times also reported the freeze was rescinded, citing two sources familiar with the matter.

On Tuesday, a federal judge had temporarily blocked the plan to halt the distribution of trillions of dollars in federal grants and loans until a hearing could be held Monday morning.

More details are available here: White House Rescinds Funding Freeze, Defusing Brewing Legal Battle

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PENNSYLVANIA — The Trump administration ordered a temporary freeze on much federal spending Tuesday, sparking panic from as trillions of dollars in federal grants and loans came under threat.

Federal funding represents a full 50 percent of the Pennsylvania state budget, so the consequences are potentially catastrophic, according to critics.

"It would seem that as a result of the White House action, there's now systems issues relating to some really, really important federal, state initiatives that we work on every day — from Career Link to Medicaid to Head Start — we literally can't access the payment systems and the computer systems that are used to run these programs every single day," Pennsylvania Gov. Josh Shapiro said from the state capitol in Harrisburg Tuesday. "That's incredibly concerning to us."

Shapiro said that his team was carefully looking over the plan and "trying to understand" what the White House was attempting to achieve.

In a memo late Monday, Matthew Vaeth, the acting director of the Office of Management and Budget, claimed "Marxist equity, transgenderism, and green new deal social engineering policies" needed to be rooted out.

Medicare and Social Security benefits are unaffected by the pause. But it’s unclear if Medicaid, food stamps, disaster assistance and other programs are affected. Even grants that have been awarded but not spent are supposed to be halted.

Local leaders, however, have pointed to a wide range of consequences.

The state's third largest county, Montgomery, receives about $140 million from federal grants per year.

"This decision will hurt hundreds of thousands of people (in Montgomery County)," Commissioner Neil Makhija said. "The potential long-term implications of this White House directive, which has tenuous legal standing, means that more kids go hungry, seniors are in danger of abuse, veterans struggle to reenter their communities, commuters experience more roadway congestion, and people struggle to afford their homes."

Specifically, Makhija said key county programs that have been helping the most at-risk residents of the county, from emergency homeowner repair and lead remediation work to rental assistance and emergency shelter operations, will be harmed.

“Trump’s executive order claims to be 'ending wokeness' but in the process is robbing people of their ability to afford groceries, education, health care, and housing," Pennsylvania Congresswoman Summer Lee said in a statement. "Everyone from students to seniors, small business owners to construction workers, that rely on federal funding are now facing uncertainty about if they will have a job or be able to go to school or even to have their next meal."

Lee pointed to the SNAP, WIC, Medicaid, meals on wheels, and rental assistance programs as some of the hardest hit.

"Freezing medical research and student aid funding? Trump might as well announce he's trying to eliminate the entire 'meds and eds' economy in Pennsylvania," Pennsylvania's Democratic House Policy Committee shared in a statement.

Democrats and independent organizations question the legality of the Republican administration’s funding freeze, characterizing it as capricious and illegal because Congress had already authorized the funding.

Court battles are imminent, and Democratic New York Attorney General Letitia James plans to ask a Manhattan federal court to block the Republican president’s moves, calling it an “unconstitutional pause on federal funding.”

“More lawlessness and chaos in America as Donald Trump’s Administration blatantly disobeys the law by holding up virtually all vital funds that support programs in every community across the country," Senate Minority Leader Chuck Schumer, a Democrat from New York, said in a statement. “If this continues, the American people will pay an awful price.”

The grants help people “in red states and blue states, support families, help parents raise kids, and lead to stronger communities,” Schumer said, adding that “it will mean missed payrolls and rent payments and everything in between: chaos for everything from universities to non-profit charities.”

The pause takes effect at 5 p.m. ET Tuesday, and it's unclear from the memo how sweeping it will be. Vaeth said that all spending must comply with Trump's executive orders, which are intended to undo progressive steps on transgender rights, environmental justice and diversity, equity and inclusion, or DEI, efforts.

Vaeth wrote that “each agency must complete a comprehensive analysis of all of their Federal financial assistance programs to identify programs, projects, and activities that may be implicated by any of the President’s executive orders.”

Washington is a hub of spending that flows to various departments, local governments, nonprofits and contractors, and the memo has left countless people who are dependent on that money wondering how they will be affected.

The pause is the latest example of how Trump is harnessing his power over the federal system to advance his conservative goals. Unlike during his first term, when Trump and many members of his inner circle were unfamiliar with Washington, this time he's reaching deep into the bureaucracy.

“They are pushing the president’s agenda from the bottom up," said Paul Light, an expert on the federal government and professor emeritus of public service at New York University.

He also said there are risks in Trump's approach, especially with so many voters reliant on Washington.

“You can’t just hassle, hassle, hassle. You’ve got to deliver.”

“Are you stopping NIH cancer trials?” Sen. Amy Klobuchar, a Democrat from Minnesota, wrote on social media, referring to the National Institutes of Health.

Sen. Patty Murray of Washington and Rep. Rose DeLauro of Connecticut, the top Democrats on the Senate and House appropriations committees, expressed “extreme alarm” in a letter to Vaeth.

"This Administration’s actions will have far-reaching consequences for nearly all federal programs and activities, putting the financial security of our families, our national security, and the success of our country at risk," they wrote.

The Associated Press contributed reporting.