Editor's Note: This story was updated January 29, 2025, with news that the Trump administration has rescinded the freeze order.
The day after a federal judge temporarily halted President Donald Trump’s freeze of federal grants and loans, the White House Office of Management and Budget rescinded the freeze order January 29, according to CNN.
The order caused confusion among organizations and states that receive federal funding, including from the bipartisan infrastructure law.
Confusion was concerned with how sweeping the freeze was, with some contractor groups seeing it as geared mostly toward electric-vehicle infrastructure and not the entire infrastructure law, but other groups weren't sure and have sought clarification.
Here’s how events unfolded up until today’s rescinding of the freeze:
A January 27 memorandum from Matthew J. Vaeth, acting director of the Office of Management and Budget, sought to temporarily stop federal agencies from disbursing federal financial assistance that may not align with a series of Trump's executive orders. Six executive orders could affect federal financial assistance, covering a variety of topics including diversity, equity, inclusion (DEI) policy, gender, immigration and energy policy. The full memorandum can be found here.
After a nonprofit advocacy group sued the OMB in the U.S. District Court for the District of Columbia that same day, U.S. District Judge Loren AliKhan granted an administrative stay on the order, just before it went into effect, until February 3 at 11 a.m. EST.
A portion of the January 27 OMB memo reads as follows:
“To implement these orders, each agency must complete a comprehensive analysis of all of their Federal financial assistance programs to identify programs, projects, and activities that may be implicated by any of the President's executive orders.
“In the interim, to the extent permissible under applicable law, Federal agencies must temporarily pause all activities related to obligation or disbursement of all Federal financial assistance, and other relevant agency activities that may be implicated by the executive orders, including, but not limited to, financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal.”
Trump Targets “Green New Deal” EV Charging Funds
The January 27 OMB memorandum marked the second action from the Trump administration to impact federal infrastructure spending and cause industry confusion.
The “Unleashing American Energy” executive order, signed by Trump January 20 under the premise of “terminating the green new deal," paused the disbursement of some funds from the Inflation Reduction Act (IRA) of 2022 and $2 trillion Infrastructure Investment and Jobs Act (IIJA). The order specifically states that it applies to “including but not limited to funds for electric vehicle charging stations made available through the National Electric Vehicle Infrastructure Formula Program and the Charging and Fueling Infrastructure Discretionary Grant Program.”
Agencies were also instructed to review their policies and processes on disbursements to ensure they align Section 2 of the executive order, which states it is the policy of the United States to, among other things:
- encourage energy exploration and production on Federal lands and waters.
- establish its position as the leading producer and processor of non-fuel minerals, including rare earth minerals.
- eliminate the “electric vehicle (EV) mandate” and "promote true consumer choice."
The full executive order can be found here.
A followup memorandum January 21 from the OMB regarding this particular portion of the executive order stated the following:
“The directive in section 7 of the Executive Order entitled Unleashing American Energy requires agencies to immediately pause disbursement of funds appropriated under the Inflation Reduction Act of 2022 (Public Law 117-169) or the Infrastructure Investment and Jobs Act (Public Law 117-58). This pause only applies to funds supporting programs, projects, or activities that may be implicated by the policy established in Section 2 of the order. This interpretation is consistent with section 7’s heading (“Terminating the Green New Deal”) and its reference to the ‘law and the policy outlined in section 2 of th[e] order.’
“For the purposes of implementing section 7 of the Order, funds supporting the “Green New Deal” refer to any appropriations for objectives that contravene the policies established in section 2. Agency heads may disburse funds as they deem necessary after consulting with the Office of Management and Budget.”
The American Association of State Highway and Transportation Officials stated in a January 24 press release that the initial interpretation of the “Unleashing American Energy” order by the Federal Highway Administration had halted all highway reimbursements for about four hours.
“There was some initial concern that the ‘Unleashing American Energy’ executive order issued by President Trump was going roll back spending in every program within the IIJA and IRA. We had a great discussion with both career staff at USDOT as well as political leadership and it is very clear that isn’t the case. It is not as broad as what many initially thought,” said Jim Tymon, AASHTO executive director.
Industry Groups Seek Clarification
Equipment World heard from several industry groups regarding the potential impact these two administrative actions could have on federal infrastructure funding.
“The Jan. 21 Trump Office of Management and Budget memo M-25-11 provides guidance regarding Section 7 of President Trump’s executive order, Unleashing American Energy, with respect to which grants and loans appropriated under the Inflation Reduction Act of 2022 and the Infrastructure Investment and Jobs Act might be paused,” said Associated Builders and Contractors Vice President of Regulatory, Labor and State Affairs Ben Brubeck on January 27. “The OMB memo clarifies the executive order only implicates policy – and by extension projects – established in Section 2 of the order related the Green New Deal. Agency heads may disburse funds as they deem necessary after consulting with the OMB.
“Associated Builders and Contractors is seeking clarity about the application of this rule to construction projects that may be affected. However, projects funded by the National Electric Vehicle Infrastructure Formula Program and the Charging Fueling Infrastructure Discretionary Grant Program appear to be under review specifically. Like many of the Biden administration’s grant, loan and tax incentive programs for infrastructure projects, the NEVI program contained controversial provisions that were opposed by ABC’s nonunion member contractors.”
“Our understanding is that they [the Trump administration] have paused funding for the EV charging station installation portion of the bill [IIJA] only. We aren’t aware of any members that have been affected by that temporary pause. Most IIJA funding is via formula funding and cannot be paused or rolled back,” said Brian Turmail, vice president, Public Affairs & Strategic Initiatives, Associated General Contractors of America on January 24.
"It is our hope that the temporary pause of Federal assistance programs announced today by the Trump White House does not include two critical infrastructure programs administered by the Environmental Protection Agency called the Drinking Water State Revolving Fund and the Clean Water State Revolving Fund, or other funds appropriated by Congress for specific water infrastructure projects,” said National Utility Contractors Association CEO Doug Carlson on January 27. “Both of these underfunded EPA programs build our nation’s water and wastewater infrastructure such as drinking water pipes and sanitary sewer systems, which are required for basic public health.
“There is nothing more American than hard-working men and women digging trenches and delivering to their community new water infrastructure. A builder like President Trump knows that every home and business require this vital underground infrastructure, and his staff should be aware almost all of these projects are funded through Federal dollars distributed by these two EPA funds or appropriated directly by Congress. And countless other vital infrastructure projects are either already underway or about to start. Delays in these critical infrastructure projects will ultimately cost American taxpayers more and disrupt essential utility or transportation services.
“NUCA and our 2,000 member companies are awaiting an update from the White House. We hope President Trump and his advisors swiftly announce that water, surface transportation, broadband, gas, and other infrastructure projects are exempted from this pause. These projects are the bedrock of American communities and our Nation's economy, and American workers and their families are counting on these projects moving forward.”
