On January 27, the White House Office of Management and Budget (OMB) issued a memo to federal agencies ordering a temporary freeze on “all federal financial assistance.”
This memo comes in response to President Donald Trump’s recent executive orders, which halted funding for things ranging from green energy projects to foreign aid to diversity-related programs.
W/A’s David DeSchryver’s take: “The pause caused a lot of confusion, but it should not impact the budget conversations for ED’s formula programs. Again, it does not affect the amounts of Title I, IDEA, HEA Title IV or other formula grants nor the timing. School officials are now spending federal fiscal year 2024 (FY24) funds, which ED allocated last year. Congress is still negotiating FY25 funds, and the government is operating under a Continuing Resolution (CR) that runs through March 14, 2025. Congress will complete FY25 in the early spring or before, and then ED will distribute the FY25 funds in time for the beginning of the 2025-2026 school year in July. Nothing there has changed, despite today’s drama.”
This morning, Chalkbeat reported that the U.S. Deputy Assistant Secretary for Communications and Strategy, Madison Biedermann, provided written clarification:
“The funding pause described in the memo only applies to discretionary grants at the Department of Education. These will be reviewed by Department leadership for alignment with Trump Administration priorities. The temporary pause does not impact Title I, IDEA, or other formula grants, nor does it apply to Federal Pell Grants and Direct Loans under Title IV, HEA.”
OMB is also circulating a 52-page document directing agencies to answer 14 questions by the end of next week for each program that “has funding or activities planned through March 15.”
Implications for K-12
It is important to note, regardless of the January 27 memo Title I would not be impacted. Title I disbursements are forward-funded and do not have planned activities ahead of March 15, 2025. Disbursements to states are typically made July 1 and October 1 annually.
“Forward funded” means that the funding allocated by Congress in one fiscal year but is not made available to states/districts until the following fiscal year. FY2025 budget talks are still in progress.
Implications for Higher Education
Pell grants and direct loans are not impacted by the January 27 memo.
While federal student loans and individual financial aid programs are excluded, there is potential that institutional grants, research initiatives, and DEI-focused programs could face delays, funding cuts, and stricter scrutiny, including programs such as Trio and Upward Bound.
Learn more: The W/A team is closely monitoring the rapidly-evolving federal education policy landscape. Stay tuned for more alerts and coverage from our team, and please reach out with any questions.