The Latest: On Thursday, January 29, President Trump rescinded the memo, dated January 27th, ordering the temporary “pause” of federal funds. In short, this “pause” would have impacted both direct federal and federal-aid programs that provide funding for construction projects across the country. The “pause” which was set to take effect at 5 p.m. on January 28th would have added uncertainty to schedules for all grant programs. While the memo has now been rescinded, the White House continues to state that the “pause” still applies to programs impacted by executive orders, like electric vehicle charging stations, which AGC reported on last week.
Background: Late on January 27th, the White House issued a memo, dated January 27th, ordering the “Temporary Pause of Agency Grant, Loan, and Other Financial Assistance Programs” which was set to take effect at 5 p.m. on January 28th. On January 28th, ahead of the effective time, they issued a clarification that any funding not subject to certain executive orders could proceed. It is also worth noting that they made clear that a “pause” was not impoundment, which you may recall AGC previously reported on.
Reaction from Congress to the “Pause” Memo: The freeze memo caused confusion and outrage from congressional leaders, particularly Democrats and even some Republicans. Senior Democrats called the move by President Trump impoundment and an unlawful act.
Courts Temporarily Block the Freeze: On the afternoon of January 28th, a judged temporarily paused President Trump’s funding freeze, as set forth by the memo, from taking effect ahead of the 5 p.m. effective time.
What happens next? Now that the memo is rescinded, most federal funding appears to be flowing again. This comes as President Trump’s selection to head the Office of Management and Budget was advanced out of committee and his confirmation will be before the full U.S. Senate soon. Will this issue re-emerge in a new memo in the future? To be determined, but AGC will keep you updated on the latest.
For additional information, please contact Alex Etchen.