OMB directive freezes grants with diversity or climate provisions

On Jan. 27, 2025, Acting OMB Director Matthew Vaeth issued a memorandum directing all federal agencies to pause the obligation or disbursement of federal financial assistance, effective Jan. 28, 2025, at 5 p.m. ET (Holland & Knight Federal Pause Analysis).

Minutes before the Jan. 28, 2025, 5 p.m

ET deadline, U.S

District Judge Loren L AliKhan temporarily blocked the assistance-pause order to maintain the status quo pending further litigation (Holland & Knight Court Intervention).

The Jan. 27 memorandum excludes direct-benefit programs—Social Security, Medicare, Medicaid, student loans and SNAP benefits—and defines federal financial assistance to encompass grants, loans, loan guarantees and cooperative agreements (Holland & Knight Program Exclusions; Assistance Definition).