Two national associations had several days earlier won an immediate temporary restraining order from Judge Alikhan of an announced plan by the US Office of Management and Budget for a "temporary pause" to review all federal funds beginning on Jan. 28 that are related to administration executive orders announced after the president's Jan. 20 inauguration.

While the OMB memo was rescinded, Judge AliKhan's previous order only extended the halt of the funding freeze to Feb. 3. 

In her new order, the judge says that new concerns raised by the two health care and non profit plaintiff groups of funding cutoffs, “the declarations and evidence presented ... paint a stark picture of nationwide panic in the wake of the funding freeze. Organizations with every conceivable mission — healthcare, scientific research, emergency shelters and more — were shut out of funding portals or denied critical resources." 

Judge Alikhan added: “Because the funding freeze threatens the lifeline that keeps countless organizations operational, plaintiffs have met their burden of showing irreparable harm.”  But in court filings, the U.S. Justice Dept. said the action by the judge, "if allowed to proceed, would constitute an extraordinary intrusion into the Executive Branch."

Still left somewhat unclear, also, are some differences in breadth of applicability across the country of Judge Alikhan's order and the one Friday by Judge McConnell

Potentially affected are state and local government grants and loans awarded under the Inflation Reduction Act and Infrastructure Investment and Jobs Act, with online publication Heatmap posting a list of targeted federal climate, energy, disaster assistance, environmental, tax credit and other programs based on government data obtained by States Newsroom not specifically confirmed by OMB. But noted on the list and in media reports as potentially at risk is funding for energy programs such as oil and gas orphan well cleanup and a U.S. hydrogen production and research boost from $7 billion in Biden Administration funding awarded to seven new public-private hubs. 

Industry Groups: 'Certainty' is MIA

Meanwhile, construction sector trade groups are still uncertain what the freeze means for their members. 

Tom Smith, executive director of the American Society of Civil Engineers, says although members span the full range of political views, those and others involved with planning infrastructure programs “want certainty” about funding levels. Smith said ASCE and members are pressing lawmakers to push for continued release of funding already appropriated under the Bipartisan Infrastructure law and Inflation Reduction Act.

Ben Brubeck, Associated Builders and Contractors’ vice president. says his group "is in touch with the Trump administration seeking clarity on how these freezes will affect member contractors and their projects, and we await additional guidance explaining [their] scope." In the interim, ABC encourages members to have "continuing conversations with their federal agency partners, customers and stakeholders receiving federal grants.”

West Virginia Senate Republican Shelley Moore Capito, whose state is part of an Appalachia regional hub with Ohio and Pennsylvania awarded up to $925 million in funding in 2023 under the infrastructure law, said Jan. 23 that money "allocated for projects like [the hub] should not be interrupted," contending Trump "didn't put a hold on money that has already been obligated." She added: "Creating more energy, hydrogen energy, I think is going to be important to this administration." Also potentially at risk is $1.2 billion the state was promised under the law for broadband expansion.

Federal agencies are directed to complete a "comprehensive analysis" in 90 days of all financial assistance programs affected by Trump's executive orders.

The 22 Democratic state attorneys general suing in Rhode Island federal court are New York, California, Illinois, Massachusetts, New Jersey, Rhode Island. Arizona, Colorado, Connecticut, Delaware, Hawaii, Maine, Maryland, Michigan, Minnesota, Nevada, New Mexico, North Carolina, Oregon, Vermont, Washington and Wisconsin. . 

New York Attorney General Letitia James said the funding pause was unconstitutional. Others said it undermines congressional authority. Trump "does not get to wake up in the morning or after an afternoon nap and direct his entire government to stop funding critical services that Congress has duly authorized and appropriated," said New Jersey Attorney General Matt Platkin, Other groups representing those affected by the funding freezes could also have legal standing to sue, reports say.

The U.S. Dept. of Defense said its contract awards would continue in a statement released late Jan. 28. “The Department continues to award new contracts to fulfill validated mission needs," it said. "While we are not aware of any specific contracts or other activities affected, it is possible that activities may be paused if they are determined to fall within the bounds of the guidance. DOD said it would provide more details "as they develop and become available."

Democratic leaders also boycotted the Jan. 30 Senate vote to confirm Russell Vought, an architect of the ultra-conservative Project 2025 policy agenda, to lead OMB until the Trump administration released the freeze on already appropriated federal funding.

Vaeth had described the hold as necessary to provide the administration enough time “to review agency programs and determine the best use of the funding for those programs consistent with the law and the president’s priorities.” 

In a Jan. 28 press briefing, Democratic Senate leader Chuck Schumer (N.Y.) described the action as a “dagger in the heart of the average American family in Red states, Blue states, in cities, in suburbs.” 

Impacts

The impact on construction projects already underway or contracted out is not yet understood, and construction groups on Jan. 28 were uncertain how broad the effects would be. 

“We are reaching out to all our contacts within various agencies to get a sense of what the memo means," Brian Turmail, vice president of public affairs and workforce at the Associated General Contractors, said. "The short answer is we are working to clarify its potential impacts. At the same time, we are communicating with the administration that any significant delay in funding will impact construction projects, negatively.”

Zack Perconti, vice president of government affairs for the National Utility Contractors Association, added: “Absent specific direction, this memo is so broad everything we are working on is potentially paused until it is clarified. Climate resilience projects are likely paused under both the Unleashing American Energy executive order and the OMB memo, but other projects like water, broadband and general surface transportation may end up being exempted.” 

Sean McGarvey, president of North America’s Building Trades Unions, said he expects “pretty massive layoffs of construction workers around the country based on the actions of the administration so far.” He said state transportation department officials and others have said "they will be shutting the funding down, which in turns means the contractors will be putting off those projects and laying our workers off.” He described the offshore wind industry as “dead.” 

White House Press secretary Karoline Leavitt said Jan. 28 that federal assistance to individuals—including Social Security benefits, food stamps, Medicare and welfare assistance—would not be affected. “However, it is the responsibility of this president and this administration to be good stewards of taxpayer dollars,” she said.

Leavitt said OMB would also review programs related to diversity, equity and inclusion programs as part of overall targeting of what its memo called "green new deal social engineering policies that are a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve.” She added that if confirmed, OMB director nominee Vought would review agency requests to continue supporting “programs that are necessary and in line with the president’s priorities.”  She defended the funding pause as "within the president's power." 

But Sen. Patty Murray (D-Wash.) Appropriations Committee vice chair, said it is not up to the president or OMB to overrule congressional law, including appropriations bills, which are typically passed through extensive bipartisan negotiation. “Republicans should not advance [Vought’s] nomination out of the committee until the Trump administration follows the law ... and makes sure the nation’s spending laws are implemented as Congress intended,” she said. 

Some Republicans have said they support the funding pause, with Budget Committee Chair Lindsey Graham (R-S.C.) releasing a statement that he would move forward with a committee vote on Vought’s nomination.