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Update: On Wednesday, Jan. 29, President Donald Trump’s administration announced it would reverse course and rescind a decision to freeze spending on federal grants. The move came after substantial outcry from leaders, both nationally and locally.
The Trump administration’s announcement on Monday that it was implementing a federal spending freeze left local leaders with numerous questions and significant concerns about what it would mean for programs and services that rely on federal funding.
A Jan. 27 memo from the U.S. Office of Management and Budget announced that “federal agencies must temporarily pause all activities related to obligation or disbursement of all federal financial assistance.” The order prompted confusion from national, state and local officials about the extent of the freeze, as well as opposition to the halt on federal funding.
The memo exempts Medicare and Social Security benefits, as well as “assistance received directly by individuals,” but lacks details on what that would mean in practice.
Officials across the country raised concerns about the impact of putting federal funding on hold for early childhood programs, major infrastructure projects, health care and housing programs that support low-income populations.
On Tuesday afternoon, a federal judge in Washington, D.C. temporarily suspended the implementation of the spending freeze until Feb. 3.
With rapid changes and a lack of information, local elected officials, nonprofits and government entities were left with no shortage of questions on Tuesday afternoon.
Santa Clara County
Santa Clara County officials responded to the fallout of the federal funding freeze at the Board of Supervisors meeting on Jan. 28, with updates unfolding in real time.
Even though the freeze was not supposed to take effect until 5 p.m. Eastern time, several county departments had already reported they had been locked out of federal payment portals, according to County Executive James Williams.
Other programs and service providers also had received stop notices from the federal government to cease activities, with particular impacts felt in social service programs like refugee assistance, Williams said.
“The county is heavily dependent on direct and indirect federal funding for health and social services programs as well as a variety of other programs,” Williams said, adding that the county was monitoring the situation closely.
About 60% of the county’s funding comes from federal and state resources, according to one board member. Even a short-term freeze could have a big impact, as the county does not have significant cash reserves on hand, Williams said.
Williams expressed particular concern about the impact of the funding freeze on health care, noting that there were conflicting messages from the White House about whether Medicaid was exempt or not.
Still, Williams emphasized that people would not be turned away from county services, including uninsured patients on MediCal.
“This is deliberate chaos. It’s patently unconstitutional, and is an effort to weaponize federal funding in a truly extraordinary way that of course harms not just those most in need, which it does, but these are programs that touch every single American,” Williams said.
Responses from local elected officials
Local elected leaders responded to the federal funding freeze, denouncing the sweeping implications of the order and promising to challenge it.
“This freeze on federal grants is illegal, immoral, and dangerous,” said state Sen. Josh Becker. “These funds support critical programs and jobs that people depend on every day. Halting them would put lives at risk, jeopardize major infrastructure projects, and hurt the economy by driving up unemployment.”
Becker listed several public safety investments threatened by the freeze, such as firefighting, police, homeland security and anti-fentanyl programs. He also noted that grants for affordable housing, school meals and reproductive health care were at risk.
“The UC system alone faces $6 billion in losses, with statewide impacts totaling $50 billion in losses to our economy. No district – red or blue – would be spared from the harm,” Becker said.
Similarly, state Assembly member Marc Berman criticized the halt in federal funding, describing it as part of the chaos and confusion of the Trump administration.
“While it is hard to determine the full impact due to the vague language of the order and contradictory statements that have come out of the White House today, the uncertainty it has created is already having a devastating impact on programs that support disaster victims, law enforcement programs, early childhood education, and so much more,” Berman said.
Berman praised state Attorney General Rob Bonta for filing a lawsuit to block the order, a sentiment shared by other elected officials
“Sensible budget-cutting requires discernment, not disregard for human suffering from halting essential public safety, health care, or disaster relief,” said U.S. Rep. Sam Liccardo. “I will fight to push the President to abide by the 1974 Budget and Impoundment Control Act and our Constitution” he said.
Santa Clara County Supervisor Margaret Abe-Koga, who represents the North County, also weighed in on the funding freeze, noting that it was a rapidly evolving situation.
“These are extraordinary and challenging times for our community. The county services we deliver are so critical, especially to the highest-need members and I am determined to meet these challenges,” Abe-Koga said.
City of Mountain View
As of Tuesday afternoon, the city of Mountain View was still assessing the situation.
“We are keeping a close watch on the evolving situation, given a federal judge has temporarily blocked the federal funding freeze this afternoon,” spokesperson Lenka Wright said.
Last fiscal year, the city received roughly $6.4 million from the federal government, Wright said. The vast majority, totaling $6.1 million, came from the U.S. Department of Housing and Urban Development. The city got another $200,000 from the U.S. Department of Transportation and $100,000 from the Federal Emergency Management Agency, Wright said.
Federal funding supported projects including the conversion of Crestview Hotel into Heartwood Apartments, Wright said. The 49-unit building now serves as affordable housing for people experiencing homelessness, or at risk of becoming homeless.
The city also used federal money to upgrade traffic lights at the corner of Shoreline Boulevard and Villa Street, as well as providing funding to the nonprofit Community Services Agency for its rent relief program, Wright said.
Schools
Similar to the city, local school district officials also said that they were waiting to receive additional information.
Mountain View Los Altos High School District Superintendent Eric Volta told the Voice that his district was currently in a “wait and see pattern,” but did not believe the order was likely to impact MVLA.
The high school district has been expecting to receive roughly $1.7 million in federal funds this school year, accounting for just over 1% of its total budget. The vast majority of the district’s funding comes from state and local sources, primarily property tax revenue.
According to Volta, the federal funding that the district does receive largely supports special education students. He expressed doubt that the Trump administration would want to cut off this support.
“I can’t imagine even his supporters being down with that,” Volta added.
Volta also shared with the Voice information he’d received from School Services of California, a consulting firm that provides financial information to school districts, suggesting that certain funding streams, including grants to support special education students, would be excluded from the pause. According to Volta, this accounts for most of MVLA’s federal funding.
At the elementary and middle school level, Mountain View Whisman Interim Superintendent Kevin Skelly said that his district also hadn’t yet discussed the spending freeze or received information from the state.
“It seems that people were surprised by the (Trump) administration’s announcement,” Skelly said in an email. “We will continue to monitor how things evolve.”
District spokesperson Shelly Hausman also pointed to the judge’s decision to pause the implementation of the funding freeze.
Mountain View Whisman is projecting that it will receive roughly $2.5 million in federal revenue this school year, as of a November update to the school board.
Nonprofits and other groups
The federal funding freeze has also prompted alarm for various organizations that rely on federal funding to support their operations.
In Mountain View, the Community Services Agency released a statement noting that it relies on federal money to help fund its programs. CSA serves thousands of the most vulnerable residents in Mountain View, Los Altos and Los Altos Hills, providing food, direct financial assistance, case management and other services.
The nonprofit receives federal funding to support programs including its food and nutrition center, services for homeless individuals, homeless prevention services, senior case management and senior nutrition, Executive Director Tom Myers said.
“We are evaluating the potential impacts of this freeze on CSA’s programs and will keep the community informed,” he said in a statement. “Thank you for your continued support during this time.”
Housing will take a hit from the funding freeze, according to YIMBY Action, a statewide nonprofit housing advocacy group that released a statement Tuesday.
“This unprecedented funding freeze, taking place in the midst of a historic nationwide housing shortage, will have devastating consequences for every member of our society, especially those already facing housing insecurity,” said Laura Foote, executive director of YIMBY Action.
YIMBY Action listed several programs administered by the U.S. Department of Housing and Urban Development that were at risk. This includes Section 8 Housing Choice Vouchers and Project-based Rental Assistance, which help house low-income families, seniors and people with disabilities.
It also noted that the freeze would likely impact grants that fund shelters, outreach and permanent supportive housing for people experiencing homelessness, as well as grants that help individuals and families stay in their homes.
“Everyone who relies on affordable housing production is damaged by this arbitrary and capricious action, from the senior citizens living in subsidized housing to the corporations who rely on predictable contracts to deliver the homes we desperately need,” Foote said. “At a time when housing costs are prohibitively expensive for so many, this is a devastating blow that will only make our economic conditions worse.”
