President Donald Trump attends inauguration ceremonies in the rotunda of the U.S. Capitol on Jan. 20, 2025, in Washington, D.C. (Photo by Chip Somodevilla/Getty Images)
WASHINGTON — A second federal judge appears ready to issue an order blocking the Trump administration from freezing funding on grant and loan programs, despite a move by the Office of Management and Budget to rescind a controversial memo Wednesday just before the hearing.
Chief Judge John J. McConnell Jr. of the U.S. District Court in Rhode Island opted not to issue his ruling during the virtual hearing, saying that he first wanted the Democratic attorneys general who filed the suit to suggest how such an order might be worded. He then wants to hear from the Justice Department lawyer arguing the case on behalf of the Trump administration about the scope of that possible order.
McConnell, who was appointed by former President Barack Obama, said the state attorneys general had convinced him that the Trump administration was likely to continue with the funding halt detailed in the now-revoked OMB memo in some way, based on a social media post from White House press secretary Karoline Leavitt.
“That hasn’t changed based on comments by the president’s press secretary,” McConnell said. “And so I’m inclined to grant the restraining order, though I’m struggling with how it would be worded and what effect it would have.”
A ruling from McConnell would be the second order blocking the Trump administration from implementing a spending pause on certain grant and loan programs.
District Judge Loren L. AliKhan on Tuesday issued a short-term administrative stay preventing President Donald Trump’s administration from starting the spending freeze. She then set a hearing in that case, brought by organizations that receive federal funding, for Feb. 3.
The original memo, released Monday evening by the Office of Management and Budget, led to widespread confusion and frustration among organizations like Meals on Wheels and grantees that rely on funding from the Department of Veterans’ Affairs, as well as members of Congress from both political parties.
Memo rescinded
The Trump administration’s Office of Management and Budget rescinded that memo Wednesday, though comments from Leavitt just afterward led to even more confusion just before the hearing began.
Leavitt wrote in a social media post that OMB rescinding the memo was “NOT a rescission of the federal funding freeze.”
“It is simply a rescission of the OMB memo,” Leavitt wrote. “Why? To end any confusion created by the court’s injunction.”
“The President’s EO’s on federal funding remain in full force and effect, and will be rigorously implemented,” she added.
Separately, Leavitt issued a written statement to reporters that seemed to suggest rescinding the OMB funding freeze memo was meant to get around AliKhan’s order.
“In light of the injunction, OMB has rescinded the memo to end any confusion on federal policy created by the court ruling and the dishonest media coverage,” Leavitt wrote in a statement. “The Executive Orders issued by the President on funding reviews remain in full force and effect and will be rigorously implemented by all agencies and departments. This action should effectively end the court case and allow the government to focus on enforcing the President’s orders on controlling federal spending. In the coming weeks and months, more executive action will continue to end the egregious waste of federal funding.”
Appropriators praise withdrawal of memo
Maine Republican Sen. Susan Collins, chairwoman of the Senate Appropriations Committee, welcomed OMB’s action before Leavitt’s post and the hearing.
“I am pleased that OMB is rescinding the memo imposing sweeping pauses in federal programs,” Collins wrote in a statement. “While it is not unusual for incoming administrations to review federal programs and policies, this memo was overreaching and created unnecessary confusion and consternation.”
Senate Appropriations Committee ranking member Patty Murray, D-Wash., released a statement that the Trump administration reversal was the right decision. That was also before Leavitt weighed in.
“This is an important victory for the American people whose voices were heard after massive pressure from every corner of this country — real people made a difference by speaking out,” Murray wrote. “Still, the Trump administration — through a combination of sheer incompetence, cruel intentions, and a willful disregard of the law — caused real harm and chaos for millions over the span of the last 48 hours which is still ongoing.”
White House assurances
OMB’s decision to rescind the memo Wednesday followed the White House making public assurances Tuesday that the spending freeze wouldn’t impact Social Security, Medicare, Medicaid and direct food assistance programs like the Supplemental Nutrition Assistance Program, or SNAP.
Two separate lawsuits seeking to block the OMB memo from taking effect on Tuesday evening at 5 p.m. were filed in federal district court.
The lawsuit filed by the National Council of Nonprofits, American Public Health Association and Main Street Alliance led to federal District Court Judge AliKhan placing a temporary hold on the planned spending freeze until Feb. 3 at 5 p.m.
The second lawsuit, heard Wednesday, was filed by Democratic attorneys general from New York, Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, North Carolina, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, Washington, Wisconsin, and the District of Columbia.