Federal agencies no longer face any pause on doling out federal grants and assistance after the Trump administration on Wednesday rescinded its controversial order to do so.
The new memorandum, just two sentences long, will allow agencies to continue their normal operations after uncertainty over the impact of the initial directive caused widespread chaos across government. It followed a temporary injunction by a federal judge that prevented the original Office of Management and Budget memo from taking effect.
“OMB Memorandum M-25-13 is rescinded,” acting OMB Director Matthew Vaeth wrote in the updated guidance. “If you have questions about implementing the president’s executive orders, please contact your agency general counsel.”
The sweeping order to freeze all federal grants, loans and assistance not provided directly to individuals led to significant confusion inside of agencies as employees faced uncertainty as to whether their programs and initiatives were affected. While the memo appeared to provide for few exceptions, administration officials said its impact would be more narrow in scope. Still, agency staff and federal grantees spent much of Tuesday seeking clarification and bracing for federal funding spigots to be shut off.
The memo raised questions about the president’s authority to pause wide swaths of congressionally appropriated funding for policy reasons, which is generally prohibited by the 1974 Impoundment Control Act. Impacted groups quickly sued and a federal judge paused the directive at least until Feb. 3 while litigation played out. The Government Accountability Office, which enforced the impoundment law, was also examining whether President Trump’s actions were legal.
“This one line walk back fortunately saves America from political disaster,” Sen. Richard Blumenthal, D-Conn., said.
Sen. Patty Murray, D-Wash., the top Democrat on the Senate Appropriations Committee, said the fight over the funding issue is “far from over.”
“The Trump administration—through a combination of sheer incompetence, cruel intentions, and a willful disregard of the law—caused real harm and chaos for millions over the span of the last 48 hours which is still ongoing,” Murray said, adding Trump’s more narrow freezes focused on foreign aid, infrastructure and climate spending remain in effect and the president’s pick to lead the OMB on a permanent basis, Russ Vought, has suggested he could ignore impoundment law.
Democrats also voiced concern the rescission will not be permanent.
“If they did it once, they can do it again,” Blumenthal said.
White House Press Secretary Karoline Leavitt said on Wednesday the revocation was only to reduce confusion with the judge’s order.
“The president’s EO’s on federal funding remain in full force and effect, and will be rigorously implemented,” Leavitt said.
