Nevada agencies scrambling as Trump announces freeze of federal loans and grants
By CHRIS MEGERIAN / Associated Press
WASHINGTON (AP) — A federal judge has temporarily blocked a Trump administration freeze on federal grants and loans that could total trillions of dollars.
U.S. District Judge Loren L. AliKhan blocked the action Tuesday afternoon, minutes before it was set to go into effect. The administrative stay pauses the freeze until Monday.
The White House had planned to start the pause as they begin an across-the-board ideological review of federal spending, but it sparked confusion and panic among organizations that rely on Washington for their financial lifeline.
In Nevada, where nearly 32 percent of the governor’s budget relies on federal funding, officials with Republican Gov. Joe Lombardo’s office said Tuesday afternoon they have connected with the White House and will be participating in a larger meeting to discuss how the federal assistance freeze could affect state agencies.
“The Office of the Governor is actively working to identify any potential funding issues and the correlating impacts to services and employees,” the statement said.
Trump administration officials said the decision to pause the federal loans and grants was necessary to ensure that all funding complies 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.
They also said that federal assistance to individuals would not be affected, including Social Security, Medicare, food stamps, student loans and scholarships. Lombardo’s office said Medicaid, the Supplemental Nutrition Assistance Program, the Head Start preschool program and Medicare will continue uninterrupted. But providers in other states are experiencing challenges drawing down federal funds through their Medicaid and Head Start portals.
Numerous state agencies and organizations that rely on federal funding — from UNLV and UNR to the Nevada Department of Health and Human Services — are still evaluating what the pause means.
Officials with the governor’s office said they are “monitoring payment systems in real-time and seeking solutions as needed.”
However, the funding freeze could affect trillions of dollars, at least temporarily, and cause widespread disruption in health care research, education programs and other initiatives. Even grants that have been awarded but not spent are supposed to be halted. State agencies and early education centers appeared to be struggling to access money from Medicaid and Head Start, stirring anxiety with answers hard to come by in Washington.
The federal government funds a wide variety of programs in Nevada’s, from food assistance to highway improvements to opioid overdose treatments to child care.
Democratic New York Attorney General Letitia James plans to ask a Manhattan federal court to block the Republican president's moves. Nevada Attorney General Aaron Ford signaled on social media that he plans to join any such lawsuit.
“My office will be taking imminent legal action against this administration’s unconstitutional pause on federal funding,” James said on social media.
The pause was scheduled to take effect at 5 p.m. ET on Tuesday, just one day after agencies were informed of the decision.
“The use of Federal resources to advance Marxist equity, transgenderism, and green new deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve,” wrote Matthew Vaeth, the acting director of the Office of Management and Budget.
Democrats and independent organizations described the pause as capricious and illegal because Congress had already authorized the money.
“The scope of this illegal action is unprecedented and could have devastating consequences across the country," said Sen. Patty Murray (D-WA), the top Democrat on the Senate Appropriations Committee. "For real people, we could see a screeching halt to resources for child care, cancer research, housing, police officers, opioid addiction treatment, rebuilding roads and bridges, and even disaster relief efforts.”
Senate Minority Leader Chuck Schumer (D-NY) called it “more lawlessness and chaos in America.”
Democrats lawmakers in Nevada, both in Congress and at the Legislature, called the move unconstitutional and said it would plunge the state — which relies heavily on federal funding — into chaos. Democratic legislative leaders called on Republican Gov. Joe Lombardo to demand that Trump reverse the policy and provide the Legislature with a full account of all affected programs.
It's unclear from the White House memo how sweeping the pause will be. Vaeth said all spending must comply with Trump's executive orders,
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." He also wrote that the pause should be implemented “to the extent permissible under applicable law.”
The Environmental Protection Agency, which distributes billions of dollars, confirmed that it would implement the pause to “align federal spending and action with the will of the American people as expressed through President Trump’s priorities.”
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.”
The Nevada Independent and Associated Press writers Moriah Balingit, Collin Binkley, Matthew Daly, Lisa Mascaro, Amanda Seitz and Michael Sisak contributed to this report.