WASHINGTON — The White House Office of Management and Budget revoked an order halting federal grant spending on Wednesday. This follows less than two days of widespread confusion and legal challenges nationwide, according to sources familiar with the matter.
The Monday evening directive from the OMB created uncertainty about vital funding for states, schools, and organizations dependent on substantial federal dollars. The White House subsequently struggled to clarify which funding would be affected by the suspension.
Sources, speaking anonymously to discuss internal communications, confirmed the OMB rescinded the order Wednesday in a brief, two-sentence notice to agencies.
Administration officials stated that the loan and grant suspension aimed to ensure spending aligned with Trump’s recent policies. Agencies were instructed to answer a series of yes/no questions about each federal program by February 7th. These questions included inquiries about whether programs promoted gender ideology or supported abortion.
However, the vaguely worded memo, combined with inconsistent White House communication, left lawmakers, officials, and citizens unclear about which programs would be impacted. Even temporary funding interruptions could lead to job losses or service delays.
The freeze, initially set to begin Tuesday at 5 p.m., was temporarily blocked by a federal judge until at least Monday following an emergency hearing requested by grant-receiving nonprofits. A separate lawsuit from Democratic state attorneys general was also pending.
Trump administration officials asserted that programs offering direct aid to Americans—including Medicare, Social Security, student loans, and food stamps—would remain unaffected. However, they often struggled to provide clear explanations.
White House press secretary Karoline Leavitt initially declined to specify whether Medicaid was exempt, but the administration later confirmed its exclusion.
Despite Trump’s campaign promise to disrupt Washington, the impact of his funding pause extended far beyond the nation’s capital. Organizations such as Meals on Wheels and Head Start, which rely on federal funding, expressed concerns about potential funding cuts.
Democratic critics swiftly celebrated the order’s reversal.
“This is a significant victory for the American people,” stated Sen. , D-Wash. “The Trump administration’s actions, through incompetence, harmful intentions, and disregard for the law, caused significant harm and chaos for millions.”
Senate Democratic leader Chuck Schumer of New York declared that “Americans resisted, and Donald Trump retreated.”