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Spokane, Washington  Est. May 19, 1883

Washington joins 21 other states to block federal freeze that could disrupt $27 billion in funding

Washington Attorney General Nick Brown is warning federal employees to be wary of a buyout offer recently made by President Donald Trump’s administration.  (Ken Lambert/Seattle Times)

Washington has joined 21 other states in a lawsuit seeking to block the federal government from freezing billions in federal funding of an array of state programs, including ones centered on education, roads and health care.

The move, announced by the attorneys general offices, followed widespread confusion throughout the country as states, nonprofits and others struggled to implement a directive from the federal Office of Management and Budget.

Initially announced in an internal memo Monday, the directive ordered federal agencies to freeze payments that “may be implicated by” President Donald Trump’s recent executive orders. According to the directive, this included “financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal.”

According to Washington Attorney General Nick Brown’s office, the order could impact funding for child care and special education, highway planning and construction, energy, substance abuse treatment and nursing care for veterans.

“The White House justifies this damaging move with culture war alarmism, but in reality they’re robbing governments and service providers of funds that keep people safe and serve urgent needs in all of our communities,” Brown said in a prepared statement. “People’s jobs are at stake. Services for veterans are at risk. Health care and education would be taken from children. Programs that support crime victims could vanish. These examples are the tip of the iceberg.”

The lawsuit from the 22 states was filed in the U.S. District Court for Rhode Island. Minutes before the order was set to take effect Tuesday, a federal judge in Washington, D.C., blocked the order from taking effect following a separate lawsuit from nonprofit and public health groups. The order will expire on Monday.

The complaint Washington joined seeks to prevent the federal government from implementing the order and requests a judicial declaration that the memo is unlawful. In the filing, the states write that while “a full account of all of the federal grant programs that benefit Plaintiff States is impossible here,” they collectively received more than a trillion dollars from the federal government in fiscal year 2024.

“Presidents have significant powers and elections have consequences,” Gov. Bob Ferguson said in a prepared statement. “However, President Trump’s refusal or inability to advance his priorities in a lawful and constitutional manner is creating needless and cruel chaos. We’re confident that the courts will, once again, determine that he is exceeding his authority.”

According to the lawsuit, Washington state received more than $27 billion in federal funding between July 1, 2023, to June 30, 2024, which accounted for 32% of the state’s budget.

“Washington simply does not have funds to cover all of these necessary programs that are currently funded through federal dollars. And it most certainly does not have the funds to backfill federal dollars while continuing to pay for the many state-funded programs on which its residents rely,” the lawsuit states.

Approximately $13 billion of the funding reimbursed Medicaid distributions. According to the complaint, while Medicaid reimbursements were intended to be exempt from the memo, Washington “is presently unable to draw funds for Medicaid reimbursements.”

On Monday, before the memo was issued, the Washington State Health Care Authority “attempted to request approximately $160 million from the Department of Health and Human Services, which was denied,” according to the complaint.

According to the complaint, the directive taking effect would “necessarily entail cuts – likely drastic cuts – to key services provided by state agencies.”

In an email Tuesday, K.D. Chapman-See, director of the Office of Financial Management, said if “a pause went into effect, it would have a devastating effect on the State of Washington, its operations, and its residents.”

Chapman-See noted that the freeze was ordered as Washington faces an estimated $12 billion budget deficit and state agencies face budget cuts of 3% to 6%.

The directive, Chapman-See wrote, “appears to halt” a wide array of state programs, were it to take effect. This includes highway construction and planning funds, low-income home energy assistance and special education grants, among other impacts.

“OMB’s direction to withhold additional billions of dollars in federal funding, even temporarily, would interfere with critical state programs, drastically worsen Washington’s budget shortfall, and make it nearly impossible for state agencies and our Legislature to prioritize needed budgeting needs,” Chapman-See wrote.