(This story will be updated as more information becomes available.)
President Donald Trump signed dozens of executive orders in his first week in office, including a “pause” on federal grants and loans.
According to USA TODAY, the order was sent by the acting head of the Office of Management and Budget, an office under the president, on Monday.
The memo said the pause will go into effect at 5 p.m. Tuesday, but did not break down the funding that would be affected, but federal financial assistance totaled $3 trillion in fiscal year 2024.
Several officials in Staunton, Waynesboro and Augusta County said they were unsure of the impact on local and regional programs. Here is what we know now about the fallout:
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Federal grants paused following two memos from Trump administration
The memo points to a legal definition of federal financial assistance, which includes grants, cooperative agreements, surplus donations, loans and interest subsidies. It exempts assistance received directly by individuals, including Medicare and Social Security benefits.
On the domestic side, the federal government issues grants for everything from road building to scientific research. It is unclear which categories will be affected. While the directive is broad, including all federal financial assistance, the memo also includes a caveat that this can only affect federal assistance “to the extent permissible under applicable law.”
A second memo from the Office of Management and Budget issued further guidance:
- Protecting the American People Against Invasion
- Reevaluating and Realigning United States Foreign Aid
- Putting America First in International Environmental Agreements
- Unleashing American Energy
- Ending Radical and Wasteful Government DEI Programs and Preferencing
- Defending Women from Gender Ideology Extremism and Restoring Biological Truth to the Federal Government
- Enforcing the Hyde Amendment
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Ending ‘wokeness,”weaponization of government,’ ‘transgenderism’
The initial OMB memo explains, “Financial assistance should be dedicated to advancing Administration priorities, focusing taxpayer dollars to advance a stronger and safer America eliminating the financial burden of inflation for citizens, unleashing American energy and manufacturing, ending ‘wokeness’ and the weaponization of government, promoting efficiency in government, and Making America Healthy Again. 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.”
Waynesboro Mayor Kenny Lee still looking at the potential fallout
Waynesboro Mayor Kenny Lee came into the position earlier this month, and is preparing the city for the potential impacts of the freeze. Right now, it’s too early to say what will happen.
“There’s been limited opportunity to read and consider the executive order,” Lee wrote in an email. “From what I’ve seen, the language and potential impact are remarkably broad. In the last fiscal year, the City of Waynesboro and its school system received more than $11 million in federal dollars. Federal grants and funds are distributed across numerous functional areas, education, transportation, human services, to name a few. Federal grants also come in a variety of forms. Some are for one-time projects, others sustain ongoing programs and services. Before firm and final conclusions are drawn about the order, it’s probably best to allow for additional time to clarify the intent and consider true realities of the order.”
Staunton superintendent unsure of cuts, but first thoughts turned to Head Start, nutritional programs
“We just don’t know anything,” said Staunton City Schools Superintendent Garett Smith. “I was trying to do a little bit of research on it. I saw a little bit of stuff come out from the Superintendent’s Association and they don’t know anything. They’re trying to get answers.”
Smith said when one hears about federal funding freezes, the items that first come to mind are Head Start and school nutrition programs.
“But as I read I didn’t really see where those things were going to be impacted,” Smith said. “But we just don’t know.”
Smith also shared the following statement can be attributed to NHSA’s Executive Director Yasmina Vinci.
“The administration’s order, while directed broadly across the federal government, is deeply unsettling and has the potential to severely disrupt the ability for Head Start programs to serve nearly 800,000 children and their families nationwide. While we understand that this is an evolving story, this disruption, at best, will slow down Head Start agencies’ ability to pay hundreds of thousands of staff, contractors, and small businesses who support Head Start operations in every corner of the country. At worst, this means that hundreds of thousands of families will not be able to depend on the critical services and likely will not be able to work. We call on the administration to urgently reverse course in order to allow Head Start programs to return to doing what they do best — serving our nation’s most at-risk children and their families.”
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Medicaid website is down
White House spokesperson Karoline Leavitt gave a statement on X, formerly Twitter, “The White House is aware of the Medicaid website portal outage.”
“We have confirmed no payments have been affected — they are still being processed and sent,” Leavitt said. “We expect the portal will be back online shortly.”
Julian Walker, Vice President of Communications for the Virginia Hospital & Healthcare Association, issued a statement on behalf of the association.
“VHHA has been informed that reimbursement for work performed under federal health care grants has been suspended, and we have received mixed responses regarding the suspension of Medicaid reimbursements for patient care,” said Walker. “There are many federally funded programs across the spectrum of public and community health, as well as mental health and substance use treatment services, among others, that are administered by private sector and non-profit organizations which provide real value and benefit to help people improve their lives and well-being. While the extent of the implications of this federal directive is still being determined, VHHA intends to work with federal stakeholders to assess the potential programmatic and financial impacts of this federal action.”
Virginia senators issue joint statement, to provide newsletter updates
In a joint statement, U.S. Sens. Mark R. Warner and Tim Kaine, both Democrats from Virginia, “blasted” the Trump administration for the funding pause.
“We call on the administration to immediately reverse course and allow the dollars Congress approved to continue reaching the places where it is so badly needed before millions of Americans are forced to pay the price for President Trump’s chaos,” reads the statement.
To help keep people with up-to-date information, the senators’ offices set up a sign-up form to get information about the pause. The form is available at warner.senate.gov/public/index.cfm/updates-on-the-trump-federal-grant-freeze-announcement.
“To that end, we wanted to advise you that we have posted a sign-up form on our website if you would like to receive updates and information as it becomes available,” reads a joint email from the senators’ offices.
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Staunton Redevelopment and Housing Authority is not expecting major changes
Nehemias Velez, Executive Director of the Staunton Redevelopment and Housing Authority, said the pause would likely not affect a majority of their programs.
“Our [U.S. Department of Housing and Urban Development] Field Office, or HUD, has not made any announcements regarding the OMB memo,” said Velez. He said the housing authority heard from the National Association of Housing and Redevelopment Officials, “HUD’s current position is that nothing is changing, and the freeze only impacts discretionary spending, not individual aid.”
Velez added that the freeze would likely pause the agency’s applications for a few grants, such as a family self-sufficiency program and vouchers that stabilize families that are getting services from the Department of Social Services.
“The SRHA hopes to get those grants and continues to have a mission that provides the most effective and productive housing services it can provide,” wrote Velez.
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Lyra Bordelon (she/her) is the public transparency and justice reporter at The News Leader. Do you have a story tip or feedback? It’s welcome through email to [email protected]. Subscribe to us at newsleader.com.
