The Office of Management and Budget (OMB) rescinded its memo on the White House Administration’s order to halt federal funds, grants, and loan disbursements Wednesday. Instead, it will seek to implement the funding freeze through coordination between OMB and each agency’s general counsel.
The OMB’s action does not stop the administration’s original order to freeze certain federal funds. However, a federal judge in Washington, D.C. has temporarily blocked implementation of the memo. The memo would impact the Small Business Administration 7(a) program, Community Development Financial Institution Fund, the National Credit Union Administration’s (NCUA) Community Development Revolving Loan Fund, and Greenhouse Gas Reduction Fund, among other programs.
America’s Credit Unions’ Compliance Blog addressed the potential impact of the original order, issued Monday, before it was blocked and rescinded.
A federal judge in Washington, D.C., temporarily blocked the pause on federal funds, grants, and loan disbursements issued in a recent Office of Management and Budget (OMB) memo. America’s Credit Unions has a new Compliance Blog post examining potential impacts on programs used by credit unions if the pause takes effect.
This includes the Small Business Administration 7(a) program, Community Development Financial Institution (CDFI) Fund, NCUA’s Community Development Revolving Loan Fund (CDRLF), and Greenhouse Gas Reduction Fund, among others.
“Many credit unions access capital through federal grant programs to put dollars to work in communities. The CDFI Fund and CDRLF have long been essential to supporting low- to moderate-income households across the country,” said America’s Credit Unions Chief Advocacy Officer Carrie Hunt. “Newer grant programs also provide capital for home equity loans, electric vehicles, and other home improvements. America’s Credit Unions has provided agencies with our perspective on these programs.”
The OMB had indicated Social Security, SNAP, Pell Grants, and funds for small businesses, farmers, and similar programs would not be paused.
Read the Compliance Blog post here.
Earlier, the White House Office of Management and Budget (OMB) had released a memo late yesterday, ordering a temporary pause on federal grants and loan disbursements to carry out President Trump’s recent Executive Orders, effective January 28, 2025 at 5:00 PM. UPDATE: Minutes before the 5 p.m. deadline, U.S. District Judge Loren AliKhan blocked the Trump administration’s directive from taking effect. The judge’s order will expire February 3 at 5 p.m. The OMB later rescinded the memo. Click here to read more: OMB rescinds memo on federal funds freeze | America’s Credit Unions.
For more context, click here.
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