Trump Administration Pauses Financial Assistance Programs

By Steve Holland and Jasper Ward

WASHINGTON (Reuters) – The Trump administration has temporarily paused grant, loan, and other financial assistance programs at the Office of Management and Budget, according to a memo seen by Reuters. This move has attracted criticism from congressional Democrats.

The memo referenced executive orders signed by President Donald Trump, aimed at dismantling diversity, equity, and inclusion (DEI) initiatives since he took office last week.

> “In the interim, to the extent permissible under applicable law, federal agencies must temporarily pause all activities related to obligation or disbursement of all federal financial assistance, and other relevant agency activities that may be impacted by the executive orders, including, but not limited to, financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the Green New Deal,” wrote Matthew J. Vaeth, the acting director of the Office of Management and Budget, in the memo.

The suspension will take effect on Jan. 28 at 5 p.m. eastern time (2200 GMT).

Top Democratic congressional budget appropriation lawmakers responded to reports of the memo by sending a letter demanding the OMB reverse its decision.

> “The scope of what you are ordering is breathtaking, unprecedented, and will have devastating consequences across the country. We write today to urge you in the strongest possible terms to uphold the law and the Constitution and ensure all federal resources are delivered in accordance with the law,” wrote Democratic Senator Patty Murray and Democratic Representative Rosa DeLauro.

Agencies have until Feb. 10 to submit detailed information on any programs, projects, or activities subject to the pause, according to the memo.

This suspension will give the administration time to review agency programs and determine the best funding uses consistent with the law and Trump’s policies. Agencies must identify legally mandated actions or deadlines for assistance programs before completing the analysis.

Vaeth directed federal agencies to halt all activities associated with open notices of funding opportunities.

> “This memorandum requires federal agencies to identify and review all federal financial assistance programs and supporting activities consistent with the president’s policies and requirement,” wrote Vaeth.