The White House is pausing federal grants and loans starting Tuesday as U.S. President Donald Trump’s administration begins an across-the-board ideological review of its spending, causing confusion and panic among organizations that rely on Washington for their financial lifeline.
President Donald Trump speaks to reporters aboard Air Force One en route from Miami to Joint Base Andrews, Md., Monday, Jan. 27, 2025.
The plan sparked confusion and panic among organizations that rely on Washington for their financial lifeline. “This sort of came out of the blue,” said David Smith, a spokesperson for the Shawnee Mission School District in Kansas, one of countless districts that receives federal funding. Now they’re trying to figure out what it means “based on zero information.”
The National Science Foundation postponed this week’s panels for reviewing grant applications. Officials in Prichard, Alabama, feared they wouldn’t receive infrastructure funding to fix their leaking drinking water system. Republican leaders in Louisiana said they were “seeking clarity” to ensure nothing was “jeopardizing financial stability of the state.”
Trillions of dollars are potentially under review. Grants that have been awarded but not spent are also supposed to be halted if they might violate one of Trump’s executive orders. Democrats described the Trump administration’s decision as capricious and illegal. They argued that the president had no right to unilaterally stop spending money appropriated by Congress.
“He’s just trying to ensure that the tax money going out the door in this very bankrupt city actually aligns with the will and the priorities of the American people,” she said.
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