Trump’s Federal Funding Freeze Sparks Confusion in Lone Star State

Texas Cities and Nonprofits Scramble to Assess Potential Impact of Trump’s Freeze on Federal Funds

Confusion reigned in Texas as local governments, nonprofits, and state agencies scrambled Tuesday to figure out just how deep cuts from President Donald Trump‘s new push to pause federal spending could go.

A ‘freeze on federal grants and loans was slated to take effect’

A federal judge temporarily halted the Trump administration’s sweeping order minutes before the freeze on federal grants and loans was slated to take effect. Should the order go into effect as early as next week, leaders of Texas cities, counties, higher education institutions, public transit agencies, and groups aimed at serving vulnerable populations will have to deal with a loss, however temporary, of federal dollars.

Who Would Be Most Affected?

Little clarity about the breadth and depth of potential cuts emerged Tuesday, but a common thread did: the Texans most likely to be affected would be its least fortunate. ‘The impact is on the people,’ said Matthew Mollica, executive director of ECHO, ‘it’s on real Americans.’

Cities Assess Potential Cuts

Major Texas cities like Dallas, Austin, Houston, and San Antonio – which rely on federal funds to help tackle crime, housing unaffordability, and homelessness, among other woes – clambered to tally the potential cost should the freeze take effect.

Houston City Controller Chris Hollins said his office is calculating how much of the city’s $6.7 billion budget could potentially get the axe if Trump‘s freeze took effect – but a preliminary analysis suggests the city’s housing and public health departments would bear a substantial portion of any cuts.

State Budget Uncertainty

Unclear, too, is how Texas‘ state budget would hold up if Trump succeeds in his push to temporarily halt federal funds. Texas budget writers expect $98.5 billion in federal dollars to help cover the cost of state health care services, public schools, higher education institutions, and highway spending among other spending priorities over the next two years.

Representatives for Texas Comptroller Glenn Hegar and the Legislative Budget Board said Tuesday they are trying to figure out what programs would be subject to Trump‘s spending halt.

Higher Education Institutions Assess Potential Impact

The state’s higher education institutions also assessed what a pause could mean for students and research endeavors. Before a federal judge paused Trump‘s move, Texas A&M University President Mark A. Welsh III told faculty and staff in an email Tuesday afternoon that federal agencies have already begun reaching out to the university with initial guidance.

Social Service Agencies Affected

Texas‘ social service agencies, including the state Health and Human Services Commission, which manages billions in state and federal aid to low-income Texans, did not answer questions about whether their agencies were unable to access federal funds, specifically when it comes to their largest programs: Medicaid, the Children’s Health Insurance Program (CHIP), or the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps.

In Texas, 3.6 million residents receive federal food assistance, and those dollars, dispensed on a debit-like Lone Star Card, are spent at grocery and food retailers throughout the state.

In November, more than $642 million in Texas SNAP transactions were made to retailers, according to Texas HHS. In the fiscal year that ended on Aug. 31, more than $7 billion in SNAP funding was distributed to Texans.

Rural Communities Could Be Disproportionately Affected

If the freeze resumes, it could have a disproportionate impact on rural communities, where about 3 million Texans reside, said Ashley Harris, director of policy and advocacy for the United Ways of Texas. ‘Rural nonprofits and communities often have fewer funding options,’ Harris said. ‘Relying on federal grants is really critical to filling in the gaps for local services.’