January 29, 2025

As you know the situation with the  ‘pause’ of federal financial assistance is ‘fluid’ and evolving.

Many NYS Council members have seen today’s statement from President Trump’s Press Secretary in response to a question about the two sentence OMB recission issued earlier today.   Here’s what the Press Secretary said (in part) as excerpted from a Politico article 1/29/25:

The Wednesday OMB memo, which was only two sentences, offered no specifics about why the Office of Management and Budget so quickly decided to rescind its original directive, saying only that any questions about implementing the president’s executive orders should be directed to each agency’s general counsel.

White House Press Secretary Karoline Leavitt said in a statement that the budget office pulled the memo “to end any confusion on federal policy created by the court ruling and the dishonest media coverage.” But she said that the president’s more narrowly tailored executive orders “remain in full force and effect and will be rigorously implemented by all agencies and departments.”I asked our colleagues at Feldesman Leifer to help us to understand what’s going on here and below is their quick and helpful response.   We are always grateful to Feldesman Leifer for the firm’s quick response to our needs and their willingness to go the extra mile.  I will of course continue to share the information I receive from Feldesman Leifer as it arrives.
Lauri
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Subject: RE: OMB memo rescinded and other news

Lauri,

Your question is a good one because Leavitt’s statement was so confusing.

In sum, our interpretation is that there is a distinction between OMB Memo M-25-13 issued Monday night, and previous Executive Orders issued earlier last week.  The new memo today rescinds the broad “pause” to all federal funding that was contemplated in Monday night’s memorandum.  While that broad, across-the-board freeze is not in play, Trump’s Executive Orders still are active and controlling.  There are at least five EOs that contemplate a review (or freeze) of the federal funding implicated within those specific areas.  Those EOs are:

• Reevaluating and Realigning United States Foreign Aid, directly addressing foreign assistance funding;
• Unleashing American Energy, freezing all programmatic funding for “green new deal” programs;
• Protecting the American People Against Invasion, freezing Department of Justice and Department of Homeland Security programs and contracts pending a review of immigration enforcement programs;
• Ending Radical and Wasteful Government DEI Programs and Preferencing, terminating all DEIA programs and activities in the federal government; and
• Ending Illegal Discrimination and Restoring Merit-Based Opportunity, terminating all DEIA-funded grant programs and contracts.

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In other words, Monday’s night memo is rescinded.  But any federal funding within the Executive Orders passed earlier last week–green new deal, DEI, foreign assistance, etc.—will still be subject to a comprehensive and rigorous review.  Leavitt states that the EOs remain in full force and effect.

Let me know if this helps with your understanding.  We also will be posting a new client alert shortly explaining this in more detail, please let me know if I should sensend it directly to you.

Best,

Mindy Pava