Amid confusion, Pa. officials worry about impact of paused federal funding freeze

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The Trump administration’s effort to pause trillions of dollars in federal funding has entered a limbo that has many officials — and people — confused.

The drama began Monday, when the U.S. Office of Management and Budget released a memo announcing a sweeping, temporary pause in federal funding would take effect Tuesday night. That pause was put on hold Tuesday by a federal judge.

On Wednesday, the White House issued a release proclaiming the “Golden Age of America that is upon us.” Shortly afterwards, the OMB rescinded its order calling for a freeze on federal aid, following a 24-hour period of tense pushback.

Pennsylvania officials, alongside local leaders throughout the country, were already weighing the potential impact of such an unprecedented freeze in federal aid. In a post on X, Gov. Josh Shapiro called the White House’s actions “reckless and unnecessary.”

“Pro tip: Next time, the Administration should do its homework instead of shutting down critical payment systems and threatening the loss of services for veterans, seniors, and kids,” Shapiro said.

But White House press secretary Karoline Leavitt issued a clarification on X, saying the new order is not a reversal of the federal funding freeze.

“It is simply a rescission of the OMB memo,” Leavitt said. “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.”

The lack of clarity is remarkable as targets of the freeze face enormous consequences. States, local governments, institutions and many nonprofits rely on federal funds to deliver services and carry out vital programs. The OMB memo called for an exception to Social Security, Medicare and direct payments to Americans.

U.S. District Judge Loren L. AliKhan’s decision to grant a temporary stay was made in order to hear arguments from the White House and the various entities who challenged the pause. That hearing is scheduled to take place Feb. 3.

Local elected officials are already experiencing fallout from the freeze.

A spokesperson for Chester County told WHYY News its Department of Community Development is currently unable to access more than $13.3 million in federal funds from the U.S. Department of Housing and Urban Development.

The money is meant to support affordable housing, homelessness and nonprofit services. Without this subsidy, 70 households with disabilities would likely be experiencing homelessness, according to county officials.

“Federal funds are also crucial for maintaining and repairing our transportation infrastructure – our roads, bridges and public transit systems that keep our county moving,” the county said in a statement. “Our residents depend on them to get to work, school, medical appointments, and for goods and services to flow smoothly. Delays in these repairs aren’t just a matter of convenience, they could be dangerous.”

Chester County government receives approximately $68 million in federal funding.

In Bucks County, spokesperson Jim O’Malley said according to the county’s current estimates, a federal funding freeze would halt roughly $300 million in “pass-through” funds and just under $80 million in direct federal grants to the county.

Montgomery County’s Democratic Commissioners Neil Makhija and Jamila Winder estimated residents benefit from more than $140 million in federal grant programs each year. The pair issued a statement Tuesday evening, arguing the pause would “hurt hundreds of thousands of people in Montgomery County.”

“That memo was reckless and should never have been issued,” Makhija said in a statement Wednesday. “While it’s fair to communicate a desire to evaluate government spending and programming, there are more effective — and legal — ways to do this in partnership with all levels of government. We’re doing everything we can to protect our residents and ensure that we’re able to continue to meet their needs, in everything from housing to public safety.”

Trump’s freeze on federal aid threatens $22 million in Housing and Urban Development grants in Montco, which would upend homeowner repair programs and damage emergency shelter operations.

County parks and trails could lose access to $188 million in regional funding. Montgomery County’s Department of Public Safety could miss out on $11 million in federal funding for its anti-terrorism task force, county officials said. The backlash to Trump’s directive continued well into the evening Tuesday.

“I call upon the President and his administration to immediately reverse course and uphold the rule of law and our Constitution,” U.S. Rep. Madeleine Dean said in a statement. “It is Congress that has the power of the purse, and hardworking families must not pay the price for the Trump Administration’s overreach.”

Nearly 3.2 million people in Pennsylvania are enrolled in Medicaid. The Trump administration evaded giving a definitive answer Tuesday on whether the program, which provides medical assistance to people with low incomes, would be affected.

Shapiro said Pennsylvania — like many other states — experienced “systems issues” with Career Link, Medicaid and Head Start. The White House blamed the computer problems on an “outage.” The OMB later clarified that Medicaid and SNAP would not be affected by the proposed pause.