Confusion.
That was the main result of a Trump Administration two-page memo issued Monday night to halt federal grants, loans and other federal financial assistance as of 5 p.m. ET on Tuesday.
Before that deadline arrived, additional guidance scaled back the scope of the freeze and a federal judge ordered the money to temporarily keep flowing as states and others challenged the legality of the policy.
Through all of that, Colorado’s Democratic lawmakers have been fielding lots of questions about the pause in federal funding.
“My office is getting calls from many local non-profits fearful their work will be impacted,” said Democratic Rep. Jason Crow on social media. “I’ve raised serious concerns with the Trump administration about these latest actions and how they’ll hurt our community.”
The original memo was vague and broad, saying it would pause “all activities related to obligation or disbursement of all federal financial assistance,” money that was already approved by Congress. It exempted payments “directly to individuals,” as well as Medicare and Social Security benefits.
The Trump administration on Tuesday afternoon issued new guidance, trying to clarify that the freeze would not be across the board, but limited to programs and activities “implicated” by Trump’s Executive Orders, such as those ending federal DEI efforts, rolling back climate efforts, and halting funding for NGOs “that undermine the national interest.” The guidance also clarified that mandatory programs, such as SNAP, would continue without pause.
It didn’t stop congressional phones from ringing off the hook.
For example, many educators woke up Tuesday morning worried the pause in funding would impact Head Start funding. Colorado receives more than $119 million for 11,600 low-income children from birth to kindergarten through federal grants. The program has about 5,000 staff members across Colorado.
“We support the process to make government more efficient, but we are also an exemplar for making sure that the funds get to working families and help them achieve their goals,” said William Browning, president and CEO of Clayton Early Learning in Denver.
The group gets about 45 percent of its budget through federal Head Start grants to support about 450 kids. The program had already drawn down its monthly funding so it wouldn’t have been immediately impacted. Still, it took the updated guidance Tuesday afternoon for the organization to learn that funds for Head Start programs were exempted.
Colorado’s Department of Early Childhood said the payment portal for programs appeared to be temporarily shut down before reopening Tuesday afternoon.
No other presidential administration has done a sweeping freeze of congressionally approved spending like this in recent memory.
As part of the funding freeze, the Office of Management and Budget sent a 51-page spreadsheet to all federal agencies, requiring them to enter information on whether any of their programs run counter to policies laid out in Trump’s executive orders. The survey covers everything from military construction projects to agricultural risk programs and reimbursements for wolf-related livestock losses, with information due by Feb. 10.
Many Colorado Democrats condemned the attempted pause in funding
The dean of the delegation, Democratic Rep. Diana DeGette called Trump’s move “unconstitutional” and said it would hurt “ALL Americans in both red and blue states.”
“His administration is holding up Congressionally-approved bipartisan funding, and it’s going to make life harder for American families across our country and abroad,” DeGette said in a statement. “Nothing about these latest actions will help to lower the cost of living for my constituents or anyone in the United States, and it will even worsen the affordability crisis we are experiencing. These actions set a dangerous precedent that erodes our system of checks and balances.”
Democratic Rep. Joe Neguse also condemned the directive shortly after it came out. “The order threatens funding for law enforcement grants, farmers, Head Start programs for children, and countless other services and programs that Coloradans rely upon. House Democrats will stand firm in defending American taxpayers by opposing this unconstitutional order and utilizing every legislative tool available to uphold the rule of law.” The later clarification again indicated that Head Start would not be impacted.
Colorado Attorney General Phil Weiser joined other state attorneys general in filing a lawsuit to stop the pause.
“This action takes the power of the purse away from Congress, violates the separation of powers, and is already causing massive harm in Colorado, undermining delivery of healthcare, education, and public safety,” he said in a statement. “This government funding shutdown is illegal and must be stopped by the courts.”
A federal judge suspended the funding freeze as the litigation plays out.
GOP Rep. Lauren Boebert, a strong Trump supporter, defended the administration’s move. She urged people not to listen to the “fearmongering of Democrats” saying the policy was “narrow in scope.”
“This is a necessary, temporary pause for specific programs listed under Executive Orders that must be evaluated as part of following through on President Trump’s promise to cut wasteful spending; our office is working with constituents to address concerns and provide more information as we receive it,” she said.
A Boebert spokesperson said they haven’t gotten many calls about the freeze, but are sharing the guidance they received from the Administration with those that have reached out.
GOP Rep. Gabe Evans stressed the freeze is temporary and “designed to give time for the White House to review where the government is overspending.”
“This is a general memo with very little specifics. The inflammatory, fear-based language you’re hearing from the left doesn't help anyone, nor is it based in fact,” he said in a social media post. He added he is waiting on more guidance from the White House on how it will affect veterans and student loans, among other issues.
Gov. Jared Polis, a Democrat, said government is about delivering results, “not sowing chaos.”
“These federal investments help people and support good-paying jobs and our economy, and this sloppy action creates confusion that distracts from Americans’ real challenge,” he said in a statement.
Hundreds of billions, even trillions of dollars flow from Washington to state and local governments, nonprofits, contracts and many others each year. And even with the clarification, many are left wondering if their funding will be impacted should the freeze eventually be implemented.
Assessing the potential impacts in Colorado:
Small businesses and economic development:
In a statement sent before the clarifying memo, the CEO of the advocacy group the Small Business Majority said any freeze in loans from the Small Business Administration would have “a devastating impact” nationwide. The SBA is a federal agency that provides loans and other aid to small businesses across the U.S. The agency’s disaster loans help companies rebuild after events like fires and hurricanes.
“The timing could not be worse. Countless businesses in California, Texas, North Carolina and Florida are struggling to rebound from major natural disasters,” Small Business Majority CEO John Arensmeyer said in an emailed statement.
However, the clarifying memo specified that “funds for small businesses” would not be impacted, and “If agencies are concerned that these programs may implicate the President’s Executive Orders, they should consult OMB to begin to unwind these objectionable policies without a pause in the payments.
A spokesperson for Colorado’s Office of Economic Development and International Trade said in a statement, “We are working with the Governor’s Office to monitor the federal funding freeze and document the full scope of OEDIT programming that could be affected. Our teams and programs promote economic growth and long-term job creation across the state, and we will continue that important work while also assessing opportunities to protect any affected programming.”
Colleges and universities:
In higher education, the federal freeze will not impact Pell Grants for low-income students or student loans made under Title IV or the Higher Education Act. It’s unclear if grants to researchers or other grants specifically for Hispanic-serving institutions — a federal designation — will be impacted.
“While it’s too early to determine the full financial impact, the university is proactively assessing potential effects on institutional grants and programming while continuing to fulfill its academic and statutory mission,” said a statement from Metropolitan State University of Denver. The university has received more than $14 million in federal funding as part of its Hispanic-Serving designation since 2019.
Several Colorado institutions, including Colorado State University, University of Colorado and Colorado School of the Mines, receive substantial federal support for research activities.
“This issue is rapidly evolving, and we recognize the uncertainty and worry our campus communities are experiencing,” said Jeremy Hueth, with the University of Colorado’s legal counsel, in a memo to campus leaders. It asked faculty to continue work as usual until there is further guidance issued.
It said it’s unclear whether federal GEAR UP grants, which prepare low-income middle and high school students to enter postsecondary education, are impacted.
In a message to CSU staff and faculty today, President Amy Parsons said there are many outstanding questions about the scope and implications of the memo.
“At this point, we ask all faculty and staff to continue with normal day-to-day activities, unless you have explicitly been directed otherwise by university leadership or a federal agency,” it said. “CSU will communicate directly with campus stakeholder groups as we learn more and receive specific guidance.”
In her message, Parsons said some CSU researchers have received stop-work orders related to diversity, equity and inclusion activities connected to sponsored projects.
For K-12 education, the temporary pause won’t impact millions of dollars targeting students in high-poverty schools and students with disabilities. Those include Title I programs and funds dispersed through the Individuals with Disabilities Education Act.
The funding pause applies only to discretionary grants at the Department of Education.
“These will be reviewed by Department leadership for alignment with Trump Administration priorities,” said Education Department spokesperson Madi Biedermann in a statement. “The Department is working with OMB to identify other programs that are not covered by the memo.”
Discretionary grants are awarded through a competitive process.
Food Banks
Food Bank of the Rockies CEO Erin Pulling said the impacts from any pause are yet to be determined, but that an estimated 20 percent of the organization’s food and funding come from the federal government.
Food banks across the state, regardless of their size, told CPR News their main concern is what would happen if a pause is put on The Emergency Food Assistance Program, which is funded by the farm bill. According to the Colorado Department of Human Services, more than 30 percent of all the food is distributed by the state’s food banks and up to 50 percent of all food in food pantries comes from the program.
Right now, the Food Bank of the Rockies estimates between 15 and 20 percent of its overall food supply comes from TEFAP.
“If that is ceased, that does have implications to our operations,” Pulling said. “And in the immediate future, how much we're relying on the generosity of the public so that there are no disruptions in service.” An estimated 11.2 percent of Coloradans are food insecure.
Nonprofit organizations:
The Colorado Nonprofit Association said news of the pause resulted in numerous inquiries about local impacts Tuesday morning.
“Beyond the crippling impact to our sector, the directive perpetuates a harmful narrative, suggesting nonprofits are responsible for the challenges our nation faces rather than being vital partners in addressing them,” said CEO Paul Lhevine.
The Boys and Girls Club in metro Denver told CPR News it was still waiting on clarification from national leadership on how programs might be immediately affected.
“These actions represent an unprecedented attack on the nonprofit sector,” Lhevine said. “The Colorado Nonprofit Association remains steadfast in our commitment to advocate for our sector and counter these harmful policies through collaboration and action.”
Transportation:
Denver International Airport officials said Tuesday they were working to determine if the freeze could potentially impact their operations.
“DEN will work closely with the new administration just as we have with all prior administrations to ensure we serve the traveling public in a safe and optimal manner,” a spokesperson wrote in an email.
At the state’s largest public transportation provider, the Regional Transportation District in Denver, officials said they did not anticipate an immediate impact on its services, initiatives or projects “in the short term” should the pause be reinstated.
“RTD will continue to work closely with federal officials and industry stakeholders to determine any potential future impacts,” agency spokesman Stuart Summers wrote in an email.
A Colorado Department of Transportation spokesperson said it received $851 million last year from the federal government, to “maintain Colorado’s roads and bridges, protecting Coloradans and saving Coloradans time and money on the roads. We are evaluating funds impacted by these actions but a delay of funds to fix our roads and bridges will cost Coloradans money through more traffic, and increased car repairs.”
CPR reporters Haylee May, Jenny Brundin, Sarah Mulholland, and Nathaniel Minor contributed to this story.
