Funds already slated for release have been allowed to push through
A US federal judge has temporarily stopped a freeze on federal loans, grants and other financial assistance imposed by US President Donald Trump’s administration, reported Reuters.
US District Judge Loren AliKhan ordered the president’s administration to allow the disbursement of “open awards”, funds that were already slated for release, until at least Monday February 3. According to AliKhan in a statement published by Reuters, the decision was made to “maintain the status quo.”
The ruling was announced on Tuesday at a hearing in Washington, D.C. federal court. AliKhan’s order does not prevent the Trump administration from cutting off funding for new programs. The administration also does not need to restart funding that has concluded.
AliKhan set a hearing for February 3 to decide next steps.
The loan freeze directive was announced by the US Office of Management and Budget’s acting head on Monday and was supposed to go into effect on Tuesday at 5pm EST. According to OMB acting director Matthew Vaeth, the funds would be held while Trump’s administration evaluated grants and loans for their alignment with the president’s priorities – such as his executive orders dismantling diversity, equity and inclusion programs.
The Trump administration claimed the programs providing critical benefits to Americans would be unaffected.
The directive was met with backlash from several groups. The National Council of Nonprofits, the American Public Health Association, Main Street Alliance and SAGE filed a suit over the directive arguing that the OMB was not authorized to unilaterally end all federal financial assistance programs across the government. Moreover, the directive focused on grant recipients partly on the basis of recipients' rights to free expression and association under the First Amendment in the US Constitution.
A suit was also filed in Providence, Rhode Island by a collective of attorneys general from 22 states and the District of Columbia to halt the fund freeze. The attorneys general argued that the Trump administration made the directive more confusing when it said that not all programs would be impacted.