A federal judge has issued a temporary block on former President Donald Trump’s recent executive order to freeze federal funding for public loans and grants.
Judge Loren AliKhan, a Biden appointee, granted an administrative stay on Tuesday, pausing the Trump administration’s plan for a week and scheduling a hearing for further arguments next Monday.
On Monday, Trump’s Office of Management and Budget (OMB) announced a temporary halt to federal agency grants, loans, and other financial assistance programs.
In a statement, the OMB outlined the rationale for the freeze:
“The American people elected Donald J. Trump to be President of the United States and gave him a mandate to increase the impact of every federal taxpayer dollar. In Fiscal Year 2024, of the nearly $10 trillion the Federal Government spent, more than $3 trillion went to federal financial assistance, such as grants and loans.”
The memo further explained that federal agencies were instructed to review all financial assistance programs to ensure they align with the administration’s priorities.
“This temporary pause will provide the Administration time to review agency programs and determine the best uses of the funding for those programs consistent with the law and the President’s priorities,” the OMB stated. The pause was set to take effect on January 28, 2025, at 5:00 p.m.
Agencies were also directed to identify legally mandated actions or deadlines related to assistance programs and report them to the OMB. Additionally, the memo called for a halt on all activities associated with open Notices of Funding Opportunities (NOFOs), including merit review panels.
Judge AliKhan’s ruling specifically targets the pause on disbursements for open grants, providing a temporary reprieve for those programs. However, the order does not address the broader legality of Trump’s funding freeze. Instead, it aims to allow the court more time for briefings and deliberation.
NBC News reported that the administrative stay delays the freeze, initially scheduled to begin on Tuesday at 5:00 p.m., giving affected parties an opportunity to present their cases in the upcoming hearing.
The hearing scheduled for Monday will determine whether the funding freeze can proceed or if further legal challenges will block its implementation. This temporary stay marks the first legal obstacle to Trump’s controversial move to reassess the distribution of federal financial assistance.