The Trump White House needs to “fix the mess they’ve created,” said Nevada Sen. Catherine Cortez Masto.
(Photo by Kent Nishimura/Getty Images)
Nevada state agencies and non-profit organizations are scrambling to determine the impact of President Donald Trump’s almost immediate freeze on funding for federal loans and grants.
“The use of Federal resources to advance Marxist equity, transgenderism, and green new deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve,” Matthew J. Vaeth, Acting Director of the Office of Management and Budget said in a memo dated Monday.
Trump’s Office of Management and Budget said the pause will go into effect at 5 p.m. Tuesday, and temporarily pause “all activities related to obligation or disbursement of all Federal financial assistance.”
“This temporary pause will provide the Administration time to review agency programs and determine the best uses of the funding for those programs consistent with the law and the President’s priorities,” the memo states.
Based on the memo, the sweeping hold would include federal grants, cooperating agreements, loans, and other types of obligations or distributions that equate to $3 trillion, or 30%, of the federal government’s annual spending.
In fiscal year, 2021, Nevada received 16% of its revenue from federal transfers, which fund education, nutritional assistance programs, infrastructure, and Medicaid, according to USA Facts, which compiles federal data.
The memo outlined an exception for some assistance programs from the funding freeze, including Medicare, Social Security benefits, and assistance provided directly to individuals.
Still, state officials, non-profit groups, and policy experts say the memo’s ambiguous language makes it difficult to know what programs will be caught in the pause.
Medicaid funding is not expected to be affected, according to an OMB official. But the order caused confusion in the program anyway.
CBS News reported state Medicaid programs were unable to access the U.S. Dept. of Health and Human Services’ Program Support Center portal on Tuesday. Nevada, however, was not locked out of its portal, an official said.
The payment management system, which distributes federal funding, on Tuesday read: “PAYMENT DELAYS: Due to Executive Orders regarding potentially unallowable grant payments, PMS is taking additional measures to process payments. Reviews of applicable programs and payments will result in delays and/or rejections of payments.”
Agencies are required to submit detailed information to OMB on any programs affected by the “temporary pause” by Feb. 10. It’s unknown if the freeze will end on that date.
“So what does this pause mean? Trump’s press secretary Karoline Leavitt said at a media briefing Tuesday. “It means no more funding for illegal DEI programs. It means no more funding for the green new scam that has cost American taxpayers tens of billions of dollars. It means no more funding for transgenderism and wokeness across our federal bureaucracy, and no more funding for Green New Deal social engineering policies.”
Americans who are “receiving individual assistance, you will continue to receive that,” Leavitt said, citing Social Security benefits, Medicare benefits, food stamps, and welfare benefits. “Assistance that is going directly to individuals will not be impacted by this pause.”
“The last four years, we’ve seen the Biden administration spend money like a drunken sailor,” Leavitt said, adding the administration intends to “make sure every penny is being accounted for honestly.”
Food, health, housing and more
Nutrition assistance programs that offer direct assistance to individuals would not be affected, according to the memo, including the Supplemental Nutrition Assistance program (SNAP) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC).
But other popular nutrition programs that offer food assistance to thousands of vulnerable Nevadans did not receive an exception under the broad memo, including several nutrition assistance programs that feed low-income children and senior citizens through the U.S. Department of Agriculture (USDA).
“The Nevada Department of Agriculture (NDA) is working with the Governor’s Office and the Governor’s Finance Office to ensure adequate funding to cover necessary programs. We expect additional guidance to come out this afternoon, and we hope to have more clarity by midday tomorrow,” said the Nevada Department of Agriculture Director J.J. Goicoechea in a statement.
One popular program that would be stripped of funding under the White House directive is the National School Lunch Program, also known as the free and reduced school lunch program. About 75% of students in CCSD qualify for free or reduced-price meals, according to the district. The program also offers after school snacks, and the free and reduced School Breakfast Program.
The Nevada Department of Agriculture also uses federal funding to provide meals for low-income children and adults receiving daycare, including children residing in homeless shelters, through the USDA’s Child and Adult Care Food Program.
Several programs under the Nevada Department of Agriculture focused on providing nutrition to low-income senior citizens could also be impacted under the White House directive, including the Senior Nutrition and Wellness program, and the Food Distribution Program on Indian Reservations.
The Senior Nutrition and Wellness program is a commodity supplemental food program that offers monthly food packages for seniors 60 years of age and older with incomes at or below 130% of poverty levels.
The Food Distribution Program on Indian Reservation provides commodity foods to low-income elderly Nevadans residing on Indian reservations in the state. The program is a vital alternative to the SNAP program for rural reservations that do not have access to grocery stores.
Some state agencies, including the Department of Health and Human Services and the Department of Education, which administers Head Start, a preschool program for low-income children, did not provide comment, saying they were still reviewing the impact of the White House memo.
Prior to the memo pausing federal funding, the Trump administration announced late last week a freeze of all meetings, travel, communications, and hiring within the National Institutes of Health.
Nevada receives $39 million in funding from NIH with organizations including Nevada System of Higher Education and Southern Nevada Cancer Research Foundation benefiting from dollars.
In a statement on Monday, the Nevada System of Higher Education said the grant funding “plays a critical role” to aid in “groundbreaking research, academic programs, workforce development, and innovative solutions to local and global challenges.”
NSHE officials are “actively monitoring the current situation with NIH.”
The Nevada Housing Division, which administers a number of federally funded loan programs for homebuyers, as well as rental assistance programs, had no information on the freeze’s impact.
“The Department is closely monitoring communications coming from the Trump Administration for clarity,” said Department of Business and Industry spokeswoman Teri Williams. “We are currently in the process of trying to determine what impact this action might have on our divisions.”
The OMB memo cites Trump’s “biological truth” executive order on transgender Americans.
Providers and facilities throughout the state that receive federal funding and provide gender-affirming care to youth and other services to adults could be affected.
“We do not know if any funding is going to be paused or not since the orders were not specific,” Jerry Cade, medical director of the Gay and Lesbian Center of Las Vegas, said Tuesday as he spoke personally and not on behalf of the Center. “Of course, we’re concerned about that.”
White House ‘needs to fix the mess they created’
In a joint statement, state Senate Majority Leader Nicole Cannizzarro and Assembly Speaker Steve Yeager, both Democrats, called on Republican Gov. Joe Lombardo to “demand answers from the White House
“Trump’s funding freeze will cause massive confusion for Nevada families, delay delivery of vital services in health care and education, and could plunge our state budget into further chaos,” the joint statement said.
“The Governor’s office must demand answers from the federal government and a reversal of this decision while providing the Legislature a full accounting of all affected state programs and services,” Cannizzaro and Yeager said.
Lombardo, who Trump credited with helping him win the presidency during a rally in Las Vegas Saturday, did not respond to requests for comment on the potential effects to the state budget or whether he intends to mitigate the impacts of the freeze.
“President Trump’s freeze on federal grants and funding has jeopardized key programs that many Nevadans rely on,” Senator Jacky Rosen said in a news release Tuesday morning. “Because of this freeze, there is now chaos and confusion about the status of critical funding needed to support local law enforcement, veterans, businesses, widely used housing programs, and others. Make no mistake, I will fight back against this unconstitutional action and work to ensure that Nevada’s federal funding resumes to continue benefiting Nevadans.”
“I was ready to confirm Sean Duffy to lead the Department of Transportation, but I cannot vote for him after the chaos President Trump has unleashed with his order to pause critical federal funding to Nevada,” said Nevada Democratic Sen. Catherine Cortez Masto in a statement.
“The funding being held up by President Trump includes support for Nevada’s seniors, veterans, and families – not to mention grants for job-creating transportation projects statewide. Working families deserve real answers from the Trump Administration about how they are going to fix the mess they’ve created.”
“My biggest concern about President Trump’s latest attempt to build a monarchy is that families, seniors, veterans, and the sick across this country will suffer because of it,” said Nevada Democratic Rep. Susie Lee in a statement.
“Hospitals, healthcare providers, and nonprofits will be forced to discontinue services or shutdown,” Lee asserted. “Federally funded infrastructure projects and (associated) jobs will halt, local law enforcement and firefighters will lose out on funding, hungry kids and seniors won’t get the food they need, schools and student aid will lose funding, and research for treatments and cures to cancers and diseases will pause.”
State lawmakers also say the federal freeze could strain the state’s budget, which was $335 million short when submitted, the result of an error by Lombardo’s office.
Michael Lyle and Hugh Jackson contributed to this report.