Originally published January 29, 2025 in the Asheville Citizen Times
Just days after President Donald Trump visited Western North Carolina to survey damage from Tropical Storm Helene, a now-rescinded White House memo ordering the pause of federal grants and loans has area nonprofits, many working on storm recovery, reeling with uncertainty and fear.
A Jan. 27 memo sent to federal agencies by the White House's Office of Management and Budget ordered a freeze on most federal grants and loans at 5 p.m. Jan. 28, essentially halting trillions in funding to local governments, state agencies and nonprofits across the country, including area organizations deep in the recovery effort.
The memo called for federal agencies to review all assistance programs to ensure they're "consistent with the President's policies and requirements" set forth in previous executive orders.
"The use of Federal resources to advance Marxist equity, transgenderism, and green new deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve," the OMB's acting director Matthew Vaeth wrote in the memo.
Just before the order would have gone into effect, a federal judge temporarily blocked the policy until Feb. 3. The next day, the White House scrapped the memo to "end any confusion created by the court's injunction."
"This is NOT a rescission of the federal funding freeze," White House Press Secretary Karoline Leavitt wrote on X Jan. 29.
"The President's EO's on federal funding remain in full force and effect, and will be rigorously implemented," she added.
The White House's latest actions did little to quell fears.
"My sense is that nonprofits are still trying to process all of these rapid developments but that the White House social media statement is only likely to create further confusion," said David Heinen, vice president for public policy and advocacy at the North Carolina Center of Nonprofits.
If a funding freeze is ultimately implemented, it could have a devastating impact on area nonprofits, especially those in WNC working in the wake of Helene.
“Not that there’s a good time, but this is a particularly bad time for this to happen,” Heinen told the Citizen Times Jan. 28, the day before the memo was rescinded. “Especially in the early stages of recovery.”
Heinen said he worried the funding freeze would temporarily shut down the operations of some nonprofits, or at least, prove incredibly disruptive to their housing, health care, early childhood, disaster recovery, and aging programs.
Cassidy Moore, the government relations and grants manager for Asheville Area Habitat for Humanity, told the Citizen Times Jan. 28 that a federal funding freeze would be “catastrophic to the recovery of WNC.”
“It will impact assistance that helps keep people in their homes, helps address and prevent homelessness, and that fund other critical housing programs,” Moore said. “It also impacts resources for infrastructure, business, healthcare, childcare, community revitalization and more.”
Before the White House rescinded its memo, Dan Leroy, president and CEO of United Way of Asheville and Buncombe County, told the Citizen Times that the White House's order "has the potential to unravel a safety net for millions of vulnerable community members and, locally, hamper recovery efforts.”
"The people in our community, this region, have been through a tremendous amount of trauma in the months following Helene," Leroy said. "Right now, there are a lot of unknowns related to this directive, which adds unnecessary stress and chaos to their lives."
‘Congress controls the purse strings, not him’
The Trump administration’s memo, which came three days after Trump said the “days of betrayal and neglect are over” for the Helene-ravaged region, faced significant resistance from state leaders concerned about the impact on recovery efforts.
In a Jan. 28 post on X, Gov. Josh Stein said he was reviewing the memo and “working with federal partners to ensure people in WNC get the support they need.”
When Stein met Trump on the tarmac of Asheville Regional Airport in Fletcher on Jan. 24, the Democratic governor asked Trump for an additional $20 billion in disaster relief for the state, plus six more months of 100% reimbursement for eligible FEMA expenses, the Citizen Times previously reported.
“Families, businesses and communities are struggling and need these urgent resources to help them rebuild,” Stein said at the time. “I look forward to working with the Trump Administration in the coming weeks and months to get people what they need to rebuild and recover.”
Additionally, attorneys general from several states, including North Carolina, filed a lawsuit in federal court attempting to block the order.
“Late last year, Congress approved spending $29 billion in federal funds for disaster recovery, small business aid, and road and bridge repairs in hurricane-hit states,” North Carolina Attorney Jeff Jackson wrote in a news release announcing the lawsuit. “The federal government’s freeze could delay receipt of these funds, disrupting recovery efforts and delaying North Carolinians’ ability to repair their homes, businesses, roads, and bridges, and revitalize western North Carolina.”
Rep. Chuck Edwards and Sen. Thom Tillis did not respond to a Citizen Times requests for comment about the memo.
Despite the confusion it sowed, a spokesperson for Sen. Ted Budd told the Citizen Times that the directive would not have impacted disaster recovery efforts in North Carolina.
“President Trump’s first trip after being sworn-in was to Western North Carolina and demonstrates how committed he is to their long-term recovery,” Budd’s office said Jan. 28. “All other narratives to the contrary are misleading.”
Direct assistance to individuals through programs like the Supplemental Nutrition Assistance Program were not expected to be affected by the White House directive.
It's unclear the toll the funding freeze would have taken on local governments reeling amid Helene-related budget constraints. Before the memo was rescinded, both the city of Asheville and Buncombe County were working to understand any potential consequences the directive would have had for services and Helene recovery.
But for some area nonprofits, the consequences were clearer.
If a funding freeze were to go into effect, Judith Long, interim executive director of the Council on Aging of Buncombe County, told the Citizen Times that it would have threatened much of the organization's programming, which is funded in part through the Older Americans Act.
“Right now, we’re hoping the pushback, the lawsuits, against this unconstitutional order will succeed,” Long said. “Congress controls the purse strings, not him.”
Long said 76% of the organization’s $1.2 million budget comes from federal funding, paying for programming like its four congregant dining centers and homebound food delivery.
Without federal funding, most of the nonprofit’s programming would be wiped out, she said.
“We may be able to salvage one or two things,” Long said.
