Update at 11:40 a.m. Jan. 29: President Donald Trump’s budget office on Wednesday rescinded an order freezing spending on federal grants that had sparked widespread confusion, including in Colorado, the Associated Press reported.
Previous reporting:
A sudden freeze on federal spending by the Trump administration — set to take effect Tuesday but put on hold by a federal judge — sent Colorado officials scrambling as they tried to figure out the extent and impact of the decision.
Much of Colorado’s $40 billion state budget as well as its hospitals, universities, early childhood programs, research laboratories, and other agencies and groups rely on federal funding for day-to-day operations. It wasn’t immediately clear how President Donald Trump’s attempted freeze, should it go into effect, would ripple through the state or affect residents’ access to services.
But early analysis from lawmakers and officials at the federal, state and local levels projected broad impact, from environmental programs to regular government funding to major capital projects reliant on federal grants. By day’s end, state officials already had joined a multi-state lawsuit challenging the action.
The Trump administration’s budget memo, issued to federal departments and agencies Monday and set to go into effect at 3 p.m. Mountain time on Tuesday, . U.S. District Judge Loren L. AliKhan issued an administrative stay on the funding freeze until next Monday.
In a statement earlier Tuesday afternoon, Gov. Jared Polis said the federal funding pause “hurts children and hardworking families, jeopardizes American jobs and businesses, harms hospitals and safety net health providers, threatens road and bridge repairs, and impacts countless other programs.”
A 51-page spreadsheet being circulated by the Office of Management and Budget, which authorized the freeze, identified hundreds of programs across federal agencies that are potentially affected, according to a copy obtained by The Denver Post. It includes funding for programs related to the Special Olympics, nutrition services, maternal and infant health, legal and burial services for veterans, clean water grants and more.
State and federal lawmakers told The Post on Tuesday morning that they were working on pulling together a list of affected state-specific programs.
The judicial order pausing its implementation gave the state some breathing room — but it still sowed “absolute chaos, confusion and fear” among Coloradans who rely on services covered by federal money, said Speaker Julie McCluskie, a Dillon Democrat, in an afternoon news conference.
She said she learned the news while meeting with Denver Health in the morning, and employees there didn’t know if they even had jobs anymore.
“This has disrupted people’s lives,” McCluskie said. “This has created fear in our communities. This is the most irresponsible act of the moment from a president who doesn’t know what the hell he’s doing.”
Legislators told The Post on Tuesday morning that funding to Medicaid, which provides care for a quarter of the state, had been shut off. Marc Williams, a spokesman for the state’s Medicaid authority, said that state officials could not access their payment system starting Monday afternoon, before the memo was issued. Access was restored shortly after 1 p.m. Tuesday.
Officials expected to receive funding Tuesday morning; the transfer has still not come through, he said, though the delay is not expected to impact providers. Williams said it wasn’t clear if the delay was related to the freeze, though he said the state Department of Health Care Policy and Financing had never had a similar issue in his 13 years at the agency.
New guidance from the OMB stated that Medicaid would not be affected by the funding freeze, though officials in other states have said their Medicaid funding was also shut off Tuesday. , White House spokeswoman Karoline Leavitt said the administration was aware of the payment portal issue and that it would be resolved soon.
The administration’s new guidance also said that payments “required by law … will be paid without interruption or delay,” and that the freeze didn’t affect SNAP — more commonly known as food stamps. Though the guidance says the freeze isn’t an “across the board” halt on federal assistance, the memo instituting the freeze states that “federal agencies must temporarily pause all activities related to obligation or disbursement of all federal financial assistance.”
Regular funding to Denver Health and federally qualified health centers, which are the safety net health care providers across the state, also appeared to be in jeopardy.
And on Tuesday, Head Start providers in Colorado dealt with a shutdown of the federal payment management system, leaving them unable to draw money. The said in a statement that the portal reopened by 1:15 p.m.
“I’m always open to ideas from anyone about how we can make government more efficient and better deliver for fellow Coloradans,” said Polis, who has pursued about the new Trump administration, in his statement. “Still, chaotic actions like this do not make our country better off. We hope that this senseless action is reversed urgently before too much damage is done to people and businesses.”
Ending “wokeness” is one of directives
The requires all federal agencies “to identify and review all Federal financial assistance programs and supporting activities consistent with the Presidentap policies and requirements.” Out of nearly $10 trillion identified in federal spending in the last fiscal year, it said nearly $3 trillion went to federal assistance.
The memo says assistance should be focused on things like manufacturing, government efficiency and “ending ‘wokeness.’ ” The memo goes on to attack “Marxist equity, transgenderism and green new deal social engineering policies” as a “waste of taxpayer dollars.”
The city of Denver’s 2025 budget, which amounts to about $4.4 billion, includes nearly $150 million in federal funding for a range of services, including small business support and road and bridge construction. Itap not yet clear which city programs will be impacted, a city spokesperson said.
“The directive from President Trump has created mass confusion across the U.S. and threatens to disrupt the lives of countless Denverites who depend on resources funded in part by the federal government — resources funded by federal taxes paid by Denverites,” said Jon Ewing, a spokesperson for Mayor Mike Johnston.
Denver Health’s outpatient clinics, hospital and research programs received a combined $89 million from federal grants in 2024, though spokesman Dane Roper said the system was still assessing how a pause would affect it.
“We are seeking additional information regarding the duration of this ‘temporary’ pause, the legality of this sweeping edict and the process to reinstate this funding,” he said in a statement. “Denying critical funding to programs that support the medical and social needs of our patients will have direct impacts on the health and well-being of Coloradans across the state.”
More than $4.3 million in grants to providers to offer addiction treatment and expand rural health services also was set to go on hiatus if the freeze took effect, according to U.S. Sen. John Hickenlooper’s office. It also would pause funding for the 988 suicide prevention line and for programs meant to prevent opioid misuse, the office’s statement said.
Several states with Democratic attorneys general, including Colorado, quickly announced plans the federal government over the pause. The lawsuit — led by New York and joined by 21 other states and the District of Columbia — was filed within hours.
“The Trump White House freeze on congressionally mandated federal aid is reckless and unprecedented,” Colorado Attorney General Phil Weiser said in a statement. “This action takes the power of the purse away from Congress, violates the separation of powers, and is already causing massive harm in Colorado, undermining delivery of healthcare, education, and public safety.
“As attorney general, I will continue to defend Coloradans and the Constitution. This government funding shutdown is illegal and must be stopped by the courts. That is why I will join other state attorneys general in filing a lawsuit to do just that.”
Differing views on impact
The executive branch is obligated to spend funds passed by Congress. A 1974 law, the , gives Congress oversight of what the executive branch may delay spending on. Withholding congressionally authorized spending was for Trump’s first impeachment during his first term.
The guidance issued by the Trump administration Tuesday explicitly pushed back on the freeze being an impoundment of federal spending. It called it “a temporary pause” to ensure that spending complies with Trump’s recent executive orders.
Jack Stelzner, a spokesman for U.S. Rep. Diana DeGette, said the Denver congresswoman’s office had been inundated with calls from constituents about what the order meant. Grace Martinez, a spokeswoman for U.S. Rep. Joe Neguse, said his office was trying to pull together a list of impacts in northern Colorado. Both are Democrats.
“What does this mean for Colorado? Funding to our police departments, our rural hospitals, programs for homeless veterans. Nearly 9,000 kids in CO Head Start programs may be locked out,” Hickenlooper, a Democrat, . “Trump is sacrificing working Americans.”
, U.S. Rep. Gabe Evans, a freshman Republican from a battleground district in northern Colorado, downplayed the freeze as “temporary” and the memo announcing it as “very general.” He accused critics of using “inflammatory, fear-based language” to describe the memo, and he said he supported the freeze’s stated intention of identifying “DEI” spending.
In a statement, U.S. Rep. Lauren Boebert said the freeze was “a necessary, temporary pause for specific programs listed under Executive Orders that must be evaluated as part of following through on President Trump’s promise to cut wasteful spending; our office is working with constituents to address concerns and provide more information as we receive it.”
Among Colorado’s other Republican members of Congress, U.S. Rep. Jeff Crank’s office did not return a request for comment. U.S. Rep. Jeff Hurd, of Grand Junction, said in a statement that his team was evaluating the order and how it might affect constituents in the 3rd Congressional District.
State lawmakers, meanwhile, were alarmed.
Sen. Jeff Bridges, a Greenwood Village Democrat and chair of the powerful Joint Budget Committee, called it a “very early, quickly written memo that has broad and far-reaching consequences.” It comes as the state is grappling with its own budget shortfall of up to $1 billion, which adds up to “potentially extremely painful cuts” to state services, he said. Even with the state’s reserves, it could not replace lost federal money.
Of the president’s action, he said: “There certainly were blusterings, and maybe even tweets, but I did not expect it to culminate in a memo like this so quickly, and with a complete and total lack of any kind of notice.”
One thing creating confusion Tuesday was which federal money is still available and which is frozen.
Just because a grant or loan has been announced does not mean the recipient has the money in a bank account to spend, said KC Becker, a former state House speaker who left her post as the Environmental Protection Agency’s Region 8 administrator on Inauguration Day. Once a grant or loan has been announced, it then must be obligated, or awarded, to the recipient.
“Even if money is awarded, it may not all be deposited in an account,” Becker said. “But usually the legal obligation comes once it’s awarded. We’ll see what the Trump administration actually does.”
The Trump administration could try to pull back funds grant by grant or yank categories of grants, Becker said. Or it could attempt to cancel projects that had been announced but not awarded.
“The executive order is very broad because it halts everything,” she said. “But they won’t have the resources to defend lawsuits from every entity out there that wants to sue. So I would guess they’ll have to narrow their approach.”
Colorado Bureau of Investigation spokesman Rob Low said the agency receives a varying amount of federal grant money each year, but it currently has about $6.1 million in active federal grant funds for programs that include addressing DNA testing backlogs at CBI’s forensics lab, crime victim assistance and the investigation of cold cases, he said.
“Freezing the disbursement of these grant funds until CBI’s next quarterly reimbursement could potentially affect (these) programs,” he said.
“We’re completely locked out”
The impact of the freeze was already felt in the state before the judge put it on hold.
The Colorado Coalition for the Homeless, which provides health care and housing for people experiencing homelessness, could not access its regular funding streams that help cover rent for hundreds of people and provide health care for thousands more. Federal funding also helps support the coalition’s staffing.
“We’re completely locked out,” said Cathy Alderman, a spokesperson for the coalition, calling the Trump administration’s move “thoughtless.” “Which means, if thatap not resolved, we’re not going to be able to pay people’s rents next week, which might mean they’re subject to eviction. And itap hundreds of people.”
With the freeze in place, the state’s 20 community health centers would lose about $24 million per month, including about $9 million that goes toward payroll and other basic operations, according to the trade group Colorado Community Health Network.
About 857,000 people use community health centers in Colorado. They offer free or low-cost care to people without insurance and serve a disproportionate share of those covered by Medicaid.
“This freeze in federal funding will stress an already ailing system, jeopardizing care for the one in seven Coloradans who consider (community health centers) their primary care home,” the group said in a statement. “We know that without access to preventative primary care, patients get sicker, and treatments become more life-threatening, and more costly on the system.”
Almost two-thirds of centers operated in the red before the pause, the group’s statement said. Centers blamed the Medicaid unwinding, saying that patients previously covered by the program hadn’t found new sources of insurance and couldn’t pay for their care. In the Denver area, one network started cutting services, while another left positions vacant.
A federal funding freeze could also impact water programs, drought mitigation, environmental cleanup and wildfire prevention efforts in Colorado. Farmers and ranchers, too, are wary of what it could mean for their livelihoods.
The EPA funnels millions of dollars to Colorado to support projects ranging from improving wastewater treatment systems to capping abandoned oil and gas wells to buying electric buses for school districts.
But now, that money may dry up faster than a stream in a July drought.
Examples of recent grants announced by the EPA that could be in jeopardy include a $324.6 million grant to Colorado State University to fund three programs that would help oil and gas operators reduce methane emissions at drilling sites. That grant was announced on Dec. 23 but the paperwork to finalize it was not finished, said Becker, the former regional EPA administrator. Methane reduction is key to Colorado’s overall goal to cut greenhouse gas emissions by nearly 100% by 2050.
The Upper Thompson Sanitation District in northern Colorado was set to receive a $96 million EPA loan to help replace its 51-year-old wastewater treatment infrastructure in the Estes Valley, which includes Rocky Mountain National Park. The utility serves about 15,500 permanent and seasonal residents but that loan, which was announced in September, is likely to get tied up in Trump’s freeze, Becker said.
Suzanne Jurgens, the Upper Thompson district manager, said she made six calls Tuesday to inquire about the loan’s status. No one returned her calls.
“I’m assuming no news is good news,” she said.
Grants for water infrastructure and wildfire mitigation could also be in jeopardy, said Aaron Weiss, deputy director of the Center for Western Priorities, a Denver-based conservation and advocacy organization. Controlled burns and fuels reduction work is often completed during the winter, but that could be at risk, he said.
“What most of those grants have in common is that they’re mostly in red areas,” he said. “They’re in rural Colorado in districts represented by Republicans.”
Impact on transportation, schools, universities
Transportation systems throughout Colorado rely on federal funding, especially those overseen by the Colorado Department of Transportation. Last year, CDOT received at least $851 million in federal money, including grants and other funds.
On Tuesday, leaders at CDOT, Denver International Airport, and the Regional Transportation District were tallying the amounts, trying to assess potential impacts, and declining to specify what those may be.
“We are still reviewing recent federal actions, and it is premature to comment on the implications,” CDOT spokesman Matt Inzeo said.
Denver Public Schools is projected to receive $96 million in federal grant funding — which represents 6.7% of the districtap general fund — for the 2024-25 academic year. This means Trump’s order could affect the districtap Head Start program and the federal meal reimbursements DPS receives for students living in poverty as soon as next school year, said spokesman Scott Pribble.
“Without these funds, we would need to reduce services or look for other local funding sources,” he said in a statement. “Any changes to federal funding will directly impact students.”
A spokesman for the Colorado Department of Education said the agency is “aware” of the federal governmentap plan to halt federal grants and loans.
“We are working to understand the potential implications of this ‘pause’ and will share more information as soon as we have it,” spokesman Jeremy Meyer said in a statement.
Federal agencies contributed $495.4 million toward the University of Colorado Boulder’s research in 2024, making up about 67% of the institution’s research funding, according to a CU financial report.
The top federal funding agencies for CU Boulder were the National Aeronautics and Space Administration (NASA), the U.S. Department of Commerce, the National Science Foundation and the National Institutes of Health.
Federal awards contributed more than $169 million in CU Boulder salaries and wages in 2024, as well as more than $4 million in student aid and more than $115 million in operating expenses, according to a university financial report.
At CSU, federal sources contributed $461 million toward the university’s sponsored project funding in the 2023 to 2024 academic year, which accounted for about 80% of sponsored project funds.
A sponsored project is a program or activity supported by external, restricted funds awarded to the university, CSU said. The projects often start with a staff or faculty member and could result in research, instruction or public service, the university said.
A 2024 example of a federally funded project at CSU was a $6.2 million study paid for by a National Institutes of Health grant “to dramatically improve intervention planning and early clinical care for young children with Down syndrome.”
The fate of these projects is unclear as local universities attempt to determine what the pause on federal grants means.
Later Tuesday, CSU said officials had been notified that Pell Grants — which provide federal financial aid for students in need — would not be paused if the freeze took effect.
Nonprofits, Native American group weigh impact
The Rocky Mountain Immigrant Advocacy Network, a Westminster-based nonprofit group serving immigrants, is “still trying to assess what programs could also be affected by the OMB memo,” said Laura Lunn, the director of advocacy and litigation.
The organization was still reeling from a blow dealt last week when one of forced RMIAN to halt several programs, including its immigration court help desk program, after receiving a stop-work order.
“Taking away access to these essential and life-saving immigration legal service programs while simultaneously ordering increases in immigration enforcement and detention that will trample community members’ rights is a shocking and gross violation of the fundamental principles of due process, equal access to justice, and to our values for caring for our community members and loved ones,” executive director Mekela Goehring said in a news release.
On top of causing challenges for the local immigrant community, the Denver Indian Center says the metro’s Native American population could feel the squeeze from the federal funding freeze. The move will affect the community center’s ability to provide emergency aid, transit services, case management and more.
It potentially could force the center to slash programs and staffing, according to a news release.
“We are doing everything we can to support our clients, but without the necessary resources, we are unable to meet the growing demand for services,” co-executive director Steve ReVello said. “Our community members are experiencing immediate hardships that could have long-term consequences if we are unable to restore this funding.”
Federal dollars critical to tribal nations, like the Ute Mountain Ute and Southern Ute in southern Colorado, could also be at stake, said Weiss, from the Center for Western Priorities. The federal government is obligated to pay tribes to operate their law enforcement, courts, housing, water, farming and other necessary programs.
“If they hold up that money, it is going to be devastating for Indian Country,” Weiss said.
Representatives from the two tribes with land in Colorado did not respond to requests for comment on Tuesday.
“Tribal Nations, more so than almost any other community, will be negatively impacted by this decision,” John Echohawk, executive director of Boulder-based Native American Rights Fund, said in a statement. “Tribal Nations rely on federal funding to address essential needs, including public safety, healthcare, education, infrastructure, and the basic needs of our most vulnerable citizens.”
The Associated Press contributed to this story.
