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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowNonprofits, businesses and local governments across the country faced losing access to trillions of federal dollars this week as President Donald Trump’s administration issued a sweeping directive to freeze funding and grants programs earlier this week.
Although the directive was paused by a judge just minutes before it was set to go into effect Tuesday afternoon—and then the administration reportedly rescinded its original directive Wednesday—the back-and-forth has left central Indiana agencies feeling unsettled and has already delayed some projects.
In Hamilton County, a $1.6 million grant the city of Noblesville received last week from the U.S. Department of Transportation’s Reconnecting Communities Pilot Grant Program was on hold as of Tuesday. Noblesville planned to use the funding to begin planning for a pedestrian bridge over the White River to make the city’s downtown more accessible.
Indianapolis-based Calumet Inc., which announced in October that it had received conditional approval for a $1.44 billion federal loan from the U.S. Department of Energy, said the first installment of that grant is delayed following the White House’s sweeping order to pause federal grant programs.
Calumet said the loan, for construction and expansion at Calumet’s renewable fuels facility in Great Falls, Montana, closed on Jan. 10 and the company had been expecting to receive the first part of that loan, about $782 million, by Tuesday. Instead, Calumet said in a statement released late Tuesday, the Department of Energy informed the company that the funding would “undergo a tactical delay to confirm alignment with White House Priorities.”
For other agencies in limbo, this week has been filled with uncertainty.
“There’s clearly a lot of anxiety,” said Chelsea Haring-Cozzi, executive director of Indianapolis’ Coalition for Homelessness Intervention and Prevention.
Indianapolis agencies facing uncertainty
Haring-Cozzi told IBJ Tuesday that her nonprofit was working with national experts and advocates to better understand the implications of the freeze. Earlier this month, the U.S. Department of Housing and Urban Development announced $39.5 million in grants to Indiana Continuum of Care programs to address homelessness, including $14.7 million for Indianapolis initiatives.
The National Alliance to End Homelessness issued a statement to the Indianapolis Continuum of Care, stating the anticipated suspension “endangers vital programs that support vulnerable communities nationwide, delaying rent payments, disrupting services and risking staff livelihoods.” The notice urged agencies to “prepare for disruption of reimbursement” and grant execution.
The city of Indianapolis has also received federal grants recently for road conversions, electric vehicle infrastructure and affordable housing. A spokesperson for Mayor Joe Hogsett’s office said Tuesday that it was unclear to his administration what projects would be impacted if the freeze goes through.
However, one Indianapolis-area project, the IndyGo Blue Line, was still moving forward as of Tuesday.
“IndyGo has not been notified that recent actions by the Trump Administration to freeze federal spending will affect the Blue Line,” spokeswoman Carrie Black said in a written statement to IBJ.
The planned rapid transit line will run east to west, from Cumberland to the Indianapolis International Airport. Nearly half of the project, expected to cost $400 million, is supported by federal funding, including a $150 million grant announced earlier this month.
Black said the transit agency still plans to begin construction on the bus line this spring.
Energy, infrastructure projects on pause
Grassroots coalition Solar Opportunities Indiana is receiving $117.4 million from the Environmental Protection Agency to expand clean energy access among low-income Hoosiers, with a goal of reducing participants’ utility bills by 20%.
The group planned to use the federal funding, part of the Inflation Reduction Act, to help pay for solar projects, training of solar industry workers, community engagement and public outreach, and public policy on solar energy.
“But, based on the executive order from last week and the (Office of Management and Budget) memorandum from yesterday, it is highly likely that there is intention to at least ‘pause’ the funding for Solar Opportunities Indiana,” Solar Opportunities Indiana Program Director Alison Becker said on Tuesday.
“Both energy affordability and job creation are priorities in Indiana, so I am hopeful the pause will either not occur or be brief if it does so that we can continue these important initiatives to help meet state objectives,” Becker said.
Hamilton County Area Neighborhood Development Inc. Executive Director Andrea Davis told IBJ Tuesday she was waiting to learn if two grants the organization received from the U.S. Department of Housing and Urban Development would be affected by the administration’s action.
Davis said the funding is set to go toward two new projects that HAND is preparing to build later this year in Noblesville and Carmel’s Home Place neighborhood.
“I guess we just have to play the waiting game,” she said.
Support for the arts
On Jan. 14, the National Endowment for the Arts announced its first round of recommended grants for fiscal year 2025. Of nearly $36.8 million in funding across the United States, $265,000 was earmarked for 13 Indiana organizations.
Indianapolis-based New Harmony Project Inc. was listed as a $40,000 grant recipient for the purpose of developing new plays.
On Tuesday, Jenni Werner, New Harmony’s executive artistic director, said she was unsure of the status of that funding, which is to be distributed as reimbursements to the organization.
“Because it was such a sweeping announcement, I don’t think anybody knows anything yet,” said Werner. “I did reach out to our contact at the NEA, and I’m sure every single organization is reaching out to them. I haven’t heard anything back officially, and I don’t even know if they fully know.”
Established by Congress in 1965, the NEA is an independent federal agency. Language in the Office of Management and Budget’s memo expressed opposition to “DEI, woke gender ideology and the Green New Deal.”
“An organization like the New Harmony Project is committed to prioritizing the voices of marginalized people,” Werner said. “It feels like we’re in more danger than organizations that might not have that kind of specifically and strongly worded commitment.”
What happens next
The Constitution gives Congress control over federal spending, a setup key to the framers’ vision of separating major powers between branches of government, The Associated Press reported.
Once appropriations are approved, the White House has the job of doling out money to states, agencies and nonprofits through the Office of Management and Budget.
Typically, the White House sends out money according to the priorities laid out by Congress, though there have been times when presidents have refused to spend all the cash they get. When the president won’t spend money that Congress has set aside, it’s called impoundment.
Trump’s Republican administration has framed the halt to federal grants and loans as a brief pause that would allow for an across-the-board review to align spending with his ideological agenda, rather than an impoundment.
Congress passed the Impoundment Control Act in the 1970s in response to a similar move by President Richard Nixon. The act says that if there’s a delay in sending out federal money, the White House is supposed to tell Congress about the pause and how much money is involved. There are some exceptions for logistical issues related to specific programs. The law also says any longer-term freeze has to get congressional approval.
The constitutionality of the administration’s directive swiftly prompted legal challenges, including a lawsuit from nonprofits receiving federal funding helmed by the group Democracy Forward and another from nearly two dozen Democratic states.
The stay issued Tuesday afternoon lasts until Feb. 3, when U.S. District Judge Loren L. AliKhan is expected to revisit the issue, weighing whether to extend the block or let the White House move forward.
On Wednesday afternoon, The Washington Post reported that a memo distributed to federal agencies by Matthew J. Vaeth, acting director of the White House Office of Management and Budget, said the memo pausing federal financial aid and related activities “is rescinded.”
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but how is this going to lower the cost of eggs???
It won’t. It will make them go up. The CDC has been forbidden to release any reports until they scrubbed of DEI and with bird flu raging, critical info is being held back that might slow or mitigate the impacts on poultry flocks. That is if we’re lucky and this stays contained to just birds.
This is just like 2017 when the CDC’s pandemic response unit was dismantled and all of the plans were thrown into the trash. In 2020 it became deadly obvious why it’s good for the country to spend money on things like that.
Just this short mention of the many projects and programs all worried about their free handouts shows how big of a waste in spending we actually have, and this is only the tip of the iceberg. If we all saw the full list of approved funding, even the leftest of the left might be concerned. Looks like congress has agreed to fund everything and everybody but you and me.
The rightest of the right would be worried if they wiped out the farm subsidies that farmers have come to rely on, especially in the ear of tariffs. I’m going to guess you’re just not aware of the government fund in that helps you. What seems like pork to us is a wise investment to someone else.
If you want to defund things, do it via Congress. Draw up a budget, clearly express what you want to get rid of, and do it that way.
“But Congress is the problem!”
No they’re not. They keep getting re-elected by us, the voters, at a record clip. We have the chance to change things every two years and we choose not to. We are easily fooled, myself included.
I remember the cuts in 2017 by our prescient leader. Remember when 45 made the first cuts, specifically the Pandemic preparedness funds were cut and that department was dismantled? No, well it was. It had deadly consequences in 2020.
The true purpose of these freezes is to transfer money from the 99% to the 1% by way of tax cuts. MAGAt’s are so brainwashed that they don’t understand that they are the PRIMARY beneficiary of many of these federally funded programs. In 2021, a QUARTER of this state’s funding came from the federal government. When will MAGAt’s stop drinking the Kool-Aid and stand up for themselves against the billionaire oligarchs ushered in with the Trump administration?
$36,221,726,999,288 total national debt. “That’s $106,137 for every single person in America.” Peter G. Peterson Foundation, National Debt Clock.
Yep and a good portion of the debt racked up under 45. Just when we have a chance to reign some of it in, by letting the windfall tax cuts for the top 1% kick back in here in 2025, the idiot in chief is falling all over himself to keep the kick back payments, sorry, I meant to say tax cuts, in place.