As you may have likely heard, last night the Trump administration issued a “temporary” pause on federal grants and loans effective today, January 28th at 5pm (ET). The memorandum from the Office of Management and Budget (OMB) states: “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 implicated 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.” The memorandum indicates Social Security and Medicare benefits will not be impacted, as well as “any other assistance determined to be provided directly to individuals.”
There is significant uncertainty about how broad this order extends. Regardless of its reach, we are certain this action will effectively halt many billions of dollars in federal grants and loans to organizations across the country and appear to leave many other federal payments in jeopardy — including grants and loans issued to charitable nonprofits, research bodies, community projects, and more in Oregon. There is also a constitutional question, as it is Congress, not the Executive Branch that holds the power of the purse and has authorized these expenditures.
NAO is working closely with our partners at the National Council of Nonprofits (NCN) and our state association colleagues around the country to get more information. We know that NCN will be filing a Motion for Temporary Restraining Order (TRO) in the U.S. District Court for the District of Columbia to block the White House Office of Management and Budget from pausing all federal agency grants and loans. The National Council of Nonprofits filed together with public health and small business leaders, represented in court by Democracy Forward. You can read their press release here.
NAO is advising any nonprofits that have federal funding to request a drawdown before 5pm ET. The freeze is expected to be 30-60 days, and every agency will likely handle differently how they do their reviews per the memorandum.
To help get a better sense of the real-world effects of the earlier-announced Executive Orders and the new freeze in federal funding, NCN set up a form on their website for nonprofits to share the effects on their missions and the people they serve. If your nonprofit is affected by either, please fill out the brief form here and share that form with any other nonprofits you know.
In the meantime, know that the NAO team stands firmly with you. The incredible anxiety we are hearing from our members, as well as the deep concern we share about the ripple effect a pause – even a temporary pause – will have on the nonprofit sector and Oregonians, the communities and missions nonprofits serve, is a distraction from the incredible and vital work of our sector.