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White House Rescinds Memorandum Freezing Federal Spending
Two days after the White House Office of Management and Budget (OMB) issued a memorandum freezing all federal grants until at least February 10, 2025, the OMB issued a memorandum reversing the spending freeze.
On Monday, January 27, 2025, the White House OMB issued a memorandum (M-25-13) instructing federal agencies to “temporarily pause all activities related to obligations or disbursement of all Federal financial assistance.” M-25-13 explained that the “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.”
Although the memorandum noted that the order would not impact Social Security or Medicare benefits, it caused broader confusion about the extent to which it would impact other assistance to individuals, including Medicaid and the Children’s Health Insurance Program (CHIP). M-25-13 stated that Federal financial assistance subject to the order did “not include assistance provided directly to individuals.” More than twenty State attorney generals filed suit against the Trump administration in light of the freeze. Several non-profit organizations also filed suit.
On January 28, 2025, a federal judge for the District Court of D.C. paused implementation of the freeze until February 3, 2025, in order to provide time for interested parties to challenge the legality of the freeze. On January 29, 2025, the OMB issued a follow-up memorandum (M-25-14), rescinding M-25-13. A second judge for the District Court of Rhode Island issued a temporary restraining order blocking the freeze on January 31, 2025, as well.
A copy of M-25-13 can be reviewed here. A copy of M-25-14 can be reviewed here.
A copy of the complaint filed by the State attorney generals is available here, and a complaint filed by non-profit organizations is available here. The D.C. District Court’s order can be reviewed here, and the Rhode Island District Court’s order can be reviewed here.
Reporter, Will Mavity, Los Angeles, + 1 213 218 4043, wmavity@kslaw.com.