- A federal judge postponed the enforcement of a Trump administration order to halt the issuance of federal grants and loans until February 3.
- The United States Department of Justice opposed to the administrative stay, which was given by Judge Loren Ali Khan at virtually the last minute before the decision went into effect.
- Previously, the Medicaid reimbursement portal was down, but the White House stated that it will be restored soon and that payments would be unaffected.
A federal judge postponed a Trump administration order that would have halted the issuance of existing federal grants and loans until agencies reviewed them.
Judge Loren AliKhan’s decision Tuesday at a Zoom hearing came only minutes before the freezing order was scheduled to take effect at 5 p.m. ET. There could be trillions of dollars at stake.
AliKhan stated that her administrative stay will expire at 5 p.m. ET Monday unless she grants a temporary restraining order, as requested by plaintiffs who filed a complaint earlier in the day challenging the Trump administration’s actions.
The court has scheduled a hearing in U.S. District Court in Washington, D.C. on Monday morning to hear arguments on the proposed restraining order. Minutes after AliKhan issued the stay, 22 states and the District of Columbia sued the Trump administration in Rhode Island federal court, disputing the order’s validity.
The United States Department of Justice had objected to Ali Khan’s administrative stay of the Office of Management and Budget’s directive, which is part of President Donald Trump’s aim to reduce spending that does not align with his efforts to eliminate “woke ideology” from government programs.
Ali Khan’s hold only impacts the disbursement of previously sanctioned government cash, not the money sought. The judge scheduled the hearing for Tuesday just hours after the lawsuit challenging the order was filed, and as the Medicaid reimbursement portal system went down in response to the Trump administration’s decision, according to numerous senators.
The OMB order, which was just leaked to news outlets Monday night, has caused widespread misunderstanding about which projects may lose money.
The memo describes a “Temporary Pause of Agency Grant, Loan, and Other Financial Assistance Programs,” as stated in the subject line. It requires federal agencies to identify and review all federal financial assistance programs and supporting activities consistent with Trump’s policies, stating that the agencies “must temporarily pause all activities related to the obligation and disbursement” of all federal financial assistance that may be implicated by Trump’s executive orders, including foreign aid, nongovernmental organization assistance, “woke gender ideology, and the green new deal.”
Nonprofit organizations and a small business organization sued the OMB in federal court in Washington on Tuesday, attempting to prevent the directive from taking effect later that day. “So if they’re missing one payment or two payments, suddenly they’re not able to make payroll, and they’re having to look at staff layoffs, and it’s not that far into the future when they may even have to shut down programs or shut down organizations,” Yental told me.
“We are … feeling relief from this temporary injunction,” she told me. Skye Perryman, CEO of the advocacy group Democracy Forward, which is representing the plaintiffs, stated, “We will not stop until the courts put an end to what is unlawful and harmful action on the part of the federal government.”