This story by Chase Woodruff appeared on Colorado Newsline on January 28, 2025.
An unprecedented move by President Donald Trump’s new administration to freeze massive amounts of federal funding beginning Tuesday afternoon could have profound and immediate consequences for Coloradans.
A two-page memo issued by the Office of Management and Budget on Monday announced the freeze, which appeared to apply to all federal financial assistance, including grants and loans. Acting OMB director Matthew Vaeth wrote that the freeze would allow the Trump administration to screen federal aid programs for efforts to “advance Marxist equity, transgenderism, and green new deal social engineering policies.”
The move could abruptly shut off funding for a vast array of programs administered by state and local governments and nonprofits, though Trump administration officials have offered scant and at times conflicting information about how broadly the freeze will be applied.
Public officials and leaders of community organizations across Colorado were left scrambling Tuesday to process the implications of the order, which — if upheld in court — would amount to a radical rewriting of constitutional precedent giving federal spending power to Congress.
“President Trump’s OMB directive is lawless and unconstitutional — and the freeze in federal funding that he is attempting will have dangerous impacts for millions of Americans,” U.S. Rep. Joe Neguse, a Lafayette Democrat, said in a statement Tuesday. “The order threatens funding for law enforcement grants, farmers, Head Start programs for children, and countless other services and programs that Coloradans rely upon.”
Colorado Attorney General Phil Weiser said Tuesday he will sue to stop the freeze.
“The Trump White House freeze on congressionally mandated federal aid is reckless and unprecedented. This action takes the power of the purse away from Congress, violates the separation of powers, and is already causing massive harm in Colorado, undermining delivery of healthcare, education, and public safety. As attorney general, I will continue to defend Coloradans and the Constitution. This government funding shutdown is illegal and must be stopped by the courts. That is why I will join other state attorneys general in filing a lawsuit to do just that.”
A separate OMB document “in support of” Vaeth’s memo included a list of more than 2,600 federal programs to be evaluated by the Trump administration as part of the spending freeze. The list included federal food stamps initiatives including the Supplemental Nutrition Assistance Program, or SNAP, and the Special Supplemental Nutrition Program for Women, Infants, and Children or WIC — but White House press secretary Karoline Leavitt insisted Tuesday that programs that provide such aid were not subject to the freeze.
In a statement, Colorado Governor Jared Polis called the freeze a “senseless action” that should be immediately reversed.
“This indefinite pause in congressionally appropriated federal funding hurts children and hardworking families, jeopardizes American jobs and businesses, harms hospitals and safety net health providers, threatens road and bridge repairs, and impacts countless other programs,” Polis said.
Colorado’s state government alone received more than $17 billion in federal grants and contracts in fiscal year 2024, according to a state transparency database. Roughly $11 billion of that total was made up of Medicaid payments to the state Department of Health Care Policy and Financing.
Of the remaining $6 billion, about $1.8 billion in grants and contracts went to the Department of Higher Education; $1 billion funded child welfare, behavioral health and other programs through the Department of Human Services; $578 million was awarded to a wide variety of programs within the Department of Public Health and Environment; $403 million went to the Department of Early Childhood; and $366 million funded wildfire and other emergency preparedness efforts under the Department of Public Safety.
Medicaid
A footnote to Trump’s OMB memo said it should not be “construed to impact Medicare or Social Security benefits” but did not mention Medicaid. The Washington Post reported that multiple states were experiencing problems with Medicaid payments on Tuesday.
Several Democrats in the Colorado General Assembly reported the state’s Medicaid payment system was down, according to the Denver Post. A state spokesperson didn’t immediately respond to a Newsline inquiry on the system’s status.
The Colorado Community Health Network, an organization representing 20 community health centers across the state, said Tuesday that the freeze would have the “immediate impact of preventing nearly $9 million in monthly payments that are used to cover payroll and other costs.” Federally qualified community health centers are typically located in underserved areas and serve patients regardless of their ability to pay.
“Colorado Community Health Network calls on the Trump Administration, including Acting Health and Human Services Secretary Dr. Dorothy Fink, and Congress to lift this freeze in funding immediately to ensure communities across America continue to have access to life-saving preventive and primary care services,” the organization wrote in a statement.
Homeless shelters and other services serving unhoused Coloradans rely heavily on grants from the Department of Housing and Urban Development to operate.
Lisa Sweeney-Miran, the director of a homeless shelter in Boulder, said that news of the funding freeze is causing agencies to halt projects related to building supportive housing and evaluate what services they’ll have to cut to stay afloat.
“If this order stands as is, I think you can expect to see widespread shutdowns — some agencies will be able to last longer than others, but all of us rely heavily on tax dollars to house and help,” Sweeney-Miran said.
EDITOR’S NOTE: Yesterday, Tuesday, U.S. District Judge Loren L. AliKhan temporarily blocked President Donald Trump from imposing a sweeping pause on trillions of dollars in federal spending, capping a frenetic day of disruption to government programs. The order prevented the new restrictions from taking effect until at least February 3, buying time for a coalition of public health advocates, nonprofits and businesses — represented by the left-leaning group Democracy Forward — to proceed with a case that may test Trump’s claims of expansive power over the nation’s fiscal trajectory.
Just minutes after AliKhan made her ruling, Democratic attorneys general from 22 states and the District of Columbia filed their own lawsuit seeking to block and permanently prevent the administration from cutting off federal funding.