The Trump administration’s sweeping federal funding freeze has been temporarily halted following legal challenges from multiple states and nonprofit organizations.
A federal judge in Rhode Island issued a temporary restraining order on January 31, ruling that the administration’s attempt to withhold already-approved funding violated the separation of powers. This decision came just before a federal judge in Washington, D.C., expanded the order, explicitly blocking the administration from reinstating the funding freeze under a different name.
The funding freeze was issued by the Office of Management and Budget (OMB) last week. The freeze created confusion for local programs, including federal grants awarded to schools and public services. Local agencies like the Grants-Cibola County School District had recently received federal funding to protect its computer systems from cyber threats— funding that was suddenly at risk when the freeze was announced.
Legal Victory for New Mexico
New Mexico Attorney General Raúl Torrez joined 22 other states in challenging the freeze, calling it an unlawful power grab by the executive branch. In a statement following the Rhode Island ruling, Torrez said, 'The President does not have the authority to unilaterally freeze funding that Congress has already approved, and this ruling makes clear that attempts to do so are unconstitutional. This is about more than a legal battle—it’s about protecting critical resources for children, seniors, veterans, and victims of crime.'
The lawsuit argued that the Trump administration’s memo violated the U.S. Constitution and federal law by imposing new conditions on funding that had already been allocated.
Despite the court rulings, the White House has not backed down on its broader efforts to cut federal spending. White House press secretary Karoline Leavitt downplayed the court’s decision, insisting that the administration would continue reviewing federal funding, 'This is not a rescission of the federal funding freeze. It is simply a rescission of the OMB memo... The President’s executive orders on federal funding remain in full force and effect and will be rigorously implemented.'
This means that while the blanket freeze has been lifted, other funding cuts could still take place through separate executive orders. Several of Trump’s existing orders continue to pause or eliminate funding for foreign aid, DEI programs, and parts of the Inflation Reduction Act.