Judge hits pause on federal funding freeze

A federal judge has issued a temporary stay blocking the Trump administration's freeze on federal funding.

U.S. District Judge Loren AliKhan issued the decision late Tuesday afternoon, just minutes before the president's order was to take effect. The National Council for Nonprofits had sued arguing for the administrative stay, which pauses the freeze until Monday.

AliKhan, who was appointed by President Joe Biden, said in halting the freeze, “It seems like the federal government currently doesn’t actually know the full extent of the programs that are going to be subject to the pause."

Saying the order violates the Constitution’s separation of powers, Massachusetts Attorney General Andrea Campbell and five other attorneys general announced a separate lawsuit in a joint press conference mere hours before the judge's order. By the time the suit was filed, 23 attorneys general had signed on to the effort.

Campbell said the suit would protect residents from the sweeping harm that enacting the freeze would cause. She also said the funding moratorium betrays Trump’s campaign promise to help people.

“He is instead stripping funding from the very families that rely on these precious resources, and is doing so illegally,” she said.

The U.S. Office of Management and Budget issued a memo Monday outlining the freeze, saying it's a move intended to align federal spending with "Presidential priorities."

The order, scheduled to begin at 5 p.m. Tuesday, "must temporarily pause" all federal loans or grants, according to the memo issued by OMB Acting Director Matthew Vaeth. It specifically named "financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal."

The plan was met with immediate outcry, with leaders across a broad swath of industries, nonprofits and agencies scrambling to understand the changes.

Massachusetts Gov. Maura Healey, who has sought to stay out of Trump's crosshairs, called the freeze "really bad." She told reporters Tuesday afternoon, "I don't understand this. Donald Trump ran on a promise to lower costs. All he's done is offer proposals and take actions that are going to raise costs for people, raise costs for businesses, and hurt our economies."

Massachusetts and several other states have reported trouble accessing Medicaid funding this week, but it's unclear whether the disruption was related to the freeze. Campbell said the state requested $40 million from the fund but, as of 2 p.m. Tuesday, had yet to receive the money. Trump's press secretary later posted on X that Medicaid payments were "still being processed" and that the White House expects its website portal to "be back online shortly."

Trump administration officials told The Associated Press that federal assistance to individuals would not be affected, including Social Security, Medicare, food stamps, student loans and scholarships. And Healey’s office said MassHealth will not stop payments to “providers, plans or other payees.”

However, the funding freeze could affect trillions of dollars, at least temporarily, and cause widespread disruption in health care research, education programs and other initiatives. Even grants that have been awarded but not spent are supposed to be halted. State agencies and early education centers appeared to be struggling to access money from Medicaid and Head Start, stirring anxiety with answers hard to come by in Washington.

In a two-page memo Tuesday, the Massachusetts comptroller asked finance officials to identify all the state programs that could be affected by the freeze. Departments were asked to respond by noon Friday.

Material from State House News Service and The Associated Press was used in this report.

Correction: An earlier version of this post inaccurately described the lawsuit in which the judge issued his temporary stay order. The story has been updated. We regret the error.