A federal court in Rhode Island issued an order temporarily halting the Trump administration’s freeze on federal aid funding, just hours after the White House rescinded the memo that had caused widespread confusion across various organizations reliant on federal assistance. The court’s action occurred on Wednesday, making U.S. District Judge John McConnell the second federal judge in less than a day to block the policy.
Judge McConnell expressed concerns during the hearing, noting that the White House had undermined its own attempt to retract the directive. The memo, originally sent out by the Office of Management and Budget (OMB), had sparked significant uncertainty among non-profit groups and federal agencies. While the White House tried to clarify the policy by rescinding the memo, McConnell argued that the memo’s ambiguous language left the directive still under the court’s jurisdiction for the time being.
“I’m inclined to grant the restraining order,” McConnell said during the hearing, adding, “I fear… that the administration is acting with a distinction without a difference.” This statement underscored his concern that despite rescinding the memo, the White House’s actions were not clear enough to stop potential harm caused by the original policy.
The controversial OMB memo, issued on a Tuesday morning, included a directive that federal agencies should pause all activities related to the obligation or disbursement of federal financial assistance. The memo specifically mentioned several areas, including foreign aid, non-governmental organizations, diversity, equity, and inclusion (DEI) initiatives, and environmental policies tied to the Green New Deal. The sweeping language of the memo set off alarm bells within federal agencies, who began to worry about their ability to operate and distribute necessary funds.
In response to the confusion, the White House issued a follow-up memo rescinding the original OMB directive. The second memo clarified that agencies should consult their legal teams regarding the implementation of the executive orders but did not fully address the uncertainty caused by the first memo. This follow-up was not enough to quell the concerns of nonprofits and advocacy groups that relied on federal funding, leading them to take legal action.
Despite the White House’s efforts to clear up the confusion, White House Press Secretary Karoline Leavitt made a statement on social media that further complicated matters. In a post on X (formerly Twitter), Leavitt asserted that the freeze on federal funding was still in effect, stating, “This is NOT a rescission of the federal funding freeze. It is simply a rescission of the OMB memo.” Leavitt emphasized that the President’s executive orders regarding federal funding remained in full force and effect, and would be implemented rigorously.
This post did little to reassure Judge McConnell, who pointed out that even though the specific memo had been rescinded, the evidence indicated that the administration’s actions remained aligned with the original directive. He noted that the harm that had been feared by the plaintiffs in the case was still likely to occur. McConnell’s remarks were based on the understanding that while the formal memo may no longer exist, the underlying policies and practices tied to the administration’s actions were still being enforced.
Judge McConnell’s ruling came just one day after a similar decision by U.S. District Judge Loren AliKhan, who issued an administrative stay that blocked the policy. That decision followed a lawsuit filed by the National Council of Nonprofits (NCN), which represents over 30,000 nonprofit organizations in North America. The NCN argued that the funding freeze would severely impact the operations of nonprofits, which rely heavily on federal assistance to carry out their work. The lawsuit was supported by other groups, including SAGE, a nonprofit organization that advocates for elderly LGBTQ+ people.
The back-and-forth legal and political developments underscore the ongoing tensions between the Trump administration’s executive orders and the concerns raised by groups dependent on federal funding. While the White House has made attempts to walk back its policy, the ambiguity surrounding its true intentions and the confusion surrounding the rescission of the memo continue to fuel legal challenges and uncertainty for federal aid recipients. The situation remains fluid, and further legal battles are expected as the administration works to clarify its stance and address the concerns raised by affected organizations.
