Nonprofits Fear Federal Grants Freeze Could Stop Critical Charity Work

Nonprofits, charities and public service programs that rely on federal financing to help low-income Americans and other vulnerable groups were in a panic Tuesday as they tried to understand what President Trump’s freeze on grants, aid programs and other federal funding would mean for their ability to function.

And Americans who benefit from the programs wondered whether they might lose critical assistance, such as meals, social services and crucial financial support.

The sweeping order’s lack of guidance left a wide range of organizations — including hospitals, emergency services, housing assistance programs and educational initiatives — wondering if they would have to immediately scale back operations in the absence of federal dollars, since no one knows when or if the money will come back online.

“It’s chaos in nonprofit world,” said Claudia Raymer, who runs the Ohio County Family Resource Network in Wheeling, W.Va., which offers meals, job placement and family support services to the needy. “It’s panic.”

The memo that the Office of Management and Budget issued on Monday stated that federal financial assistance should be aimed at easing inflation, improving efficiency, “ending ‘wokeness’ and the weaponization of government, and Making America Healthy Again.” It also decried what it identified as a practice of directing federal funds “to advance Marxist equity, transgenderism and Green New Deal social engineering policies” as “a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve.”

But the groups that depend on federal money for charity work said on Tuesday that they were stunned and confused by the Trump administration’s order.

Vinsen Faris, the chief executive of a Meals on Wheels program that serves 4,000 seniors around San Antonio, said he had received calls from clients wondering: “Am I going to get my meal tomorrow?”

The White House insisted in a second memo that the sweeping freeze would not affect programs that provide direct benefits to recipients, and that Social Security, Medicare, Medicaid and Supplemental Nutrition Assistance Program payments — better known as food stamps — would not be subject to the pause.

The administration also insisted that programs to help small businesses and farmers and offer rental assistance would not be affected, and that Head Start and Pell grants, which help students from low-income families with college tuition — would also be exempt.

But there were reports on Tuesday that some of the programs the White House had promised to exempt had been affected by the freeze. On Tuesday, senators said that several states had been locked out of their websites for filing Medicaid claims, meaning hospitals would not be paid for providing care to low-income and disabled participants in the health care program.

Program administrators also worried about the detrimental effect the freeze might have on needy individuals who depend on assistance that is doled out through nonprofits.

Not all federal grants follow the same path to reach recipients. Some are given out directly by federal agencies, while others are routed through state governments or middleman nonprofits. Some are paid out as a lump sum, while in other cases, nonprofits must do the work first, then seek reimbursement.

On Tuesday, nonprofit leaders said they were unsure which of these pathways had been — or would be — shut off by the Trump administration’s order. Groups said they had called state government agencies and partner nonprofits in search of answers, but learned nothing.

“Nonprofits are petrified right now,” said Rick Cohen, a spokesman for the National Council of Nonprofits, which has over 30,000 member organizations nationwide, some of which had already reported having their grant funding cut. “They don’t know if their funding is shut off. If it is shut off, they don’t know for how long.”

He said that even a pause in funding until mid-February could be devastating for some groups. “Many of them do not have the budget flexibility to keep offering the services that are needed, even for a short period of time,” he said.

Groups representing public school administrators and teachers wondered how the sweeping order would compromise educational funding programs, including those that help schools with high concentrations of children living in poverty.

“Yesterday’s announcement includes a lot of information without a lot of specifics,” the American Association of School Administrators, an organization for superintendents, said in a statement, adding: “We can’t, with the information the president has released, have any certainty on what it will mean” for the next school year.

But to other organizations serving low-income clients, the impact could be more sudden. The order was expected to affect the Department of Agriculture’s Women, Infants and Children program, which provides needy families with monthly cash benefits to buy fruits and vegetables.

Dominika Parry, the president of the nonprofit group 2C Mississippi, worried that the order could indefinitely freeze a $19.8 million grant that the Environmental Protection Agency recently told her organization it would receive to provide emergency services to low-income residents during weather disasters.

“It’s incredibly frustrating and very scary,” Ms. Parry said, adding that the funding was to support “a facility that is desperately needed for disasters and would be immediately used.”

Lisa Friedman, Zach Montague Erica L. Green and Madeleine Ngo contributed reporting.

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