‘People are just flipping out’: Billions in federal funding remain frozen despite court orders to keep the taps open

Federal agencies across Washington are finding ways to keep funding frozen even after judges last month temporarily blocked the White House’s effort to pause trillions of dollars in federal assistance.

Federal agencies across Washington are finding ways to keep funding frozen even after judges last month temporarily blocked the White House’s effort to pause trillions of dollars in federal assistance. FEMA has clawed back $80 million intended to help New York City house migrants. The EPA has paused more than 30 grant programs, including some providing money for schools to buy electric buses. And USAID contractors say hundreds of millions of dollars of contracts have not been paid. Trump officials say the suspensions are lawful and comply with President Donald Trump’s executive orders, arguing he has broad powers over federal spending as president. But multiple lawsuits now accuse the administration of violating Congress’ powers over government spending, as well as a federal judge’s orders to turn funding back on after the White House freeze late last month. Interviews with more than two dozen administration officials, government contractors and activists – as well as court filings in lawsuits alleging the government is failing to fulfill funding lawfully appropriated by Congress – reveal the degree to which federal spending remains in a state of chaos as Trump and Elon Musk’s Department of Government Efficiency move rapidly to axe spending, even as judges tell the government to continue letting money out the door. That’s left US contractors in a state of upheaval, and in many cases led to furloughs and layoffs of workers at organizations that rely on government funding. “People are just flipping out, and most of them are being careful about what they say,” said Jason Walsh, executive director of climate and labor group the BlueGreen Alliance.