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- The White House is temporarily freezing some federal grants and financial assistance programs.
- A memo calls for agencies to ensure that their grants align with the administration’s priorities.
- The pause is set to go into effect at 5pm ET on Tuesday.
The White House is pausing the payment of billions of dollars of federal grants on Tuesday, according to an internal memo sent to executive branch agencies on Monday and obtained by Business Insider.
The two-page memo authored by Matthew J. Vaeth, the acting director of the Office of Management and Budget, said there would be a “temporary pause” in the “disbursement of all Federal financial assistance,” effective from Tuesday at 5 p.m.
“This temporary pause will provide the Administration time to review agency programs and determine the best uses of the funding for those programs consistent with the law and the President’s priorities,” the memo said.
The pause aims to clamp down on government spending linked to “financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal,” the memo said.
It said that these were a “waste of taxpayer dollars.”
Vaeth’s memo called for all federal agencies to do a comprehensive analysis of their grants and programs to ensure that they align with the new administration’s priorities.
The freeze could be a blow to states that depend on the federal government’s coffers, such as Alaska, which in 2023 received more than $6,500 per capita in federal grants, a report by the Federal Funds Information for States found.
A large percentage of the grants — more than half in the case of Alaska — was going toward Medicaid, FFIS wrote in the October report.
In his first week in office, President Donald Trump has undone policies related to diversity, equity, and inclusion. Shortly after his inauguration, he signed an executive order ending DEI programs in the federal government.
Trump has also created the Elon Musk-run Department of Government Efficiency, or DOGE, to cut government spending and roll back regulations.
Read the full memo below: