Protect Federal Funds for Children and Families
Is this pause in federal funds impacting you, your organization, or children and families in Arizona? We are collecting stories to help shine a light on the potential impacts of loss of federal funds. Please consider sharing your story with us and collaborating to protect vital services for children and families.
The federal government, through the Office of Management and Budget (OMB), has directed agencies to review federal grants and financial assistance and to temporarily pause federal financial assistance. This means a sudden halt to the disbursement of federal funds to states, tribes, local governments, non-profit organizations, private sector partners, and more.
This directive, in OMB Memo 25-13, causes great concern and uncertainty.
A Pause in Federal Funds Will Hurt Arizona
Arizona receives a significant amount of federal funds that are vital to the lives of Arizonans. In a 2024 state-by-state analysis of the percentage of state revenue from federal funds, Arizona was in the top ten states, ranked as the state with the third-highest share of federal funds. More recent recent data demonstrates that federal funds account for 45% of Arizona’s budget. This ranges from health care to highways to veteran’s care, child care, and services for seniors. Even a temporary pause in Arizona’s federal funds has the potential to cause harm.
Arizonans Rely on Lifesaving and Life-Changing Services Supported by Federal Funds
As the former Assistant Secretary of the Administration for Children and Families (ACF) at the U.S. Department of Health and Human Services (HHS), I know how much pain will be caused if federal investments are withheld. I know because I’ve met so many of the parents, children, and people who are impacted by what they often call “lifesaving” or “life-changing” services. At HHS, funds are disbursed for critical programming, including Medicaid and State Children’s Health Insurance Programs, substance use treatment, suicide prevention, pandemic preparedness, and much more. At ACF alone, federal funds historically support: Children in foster care, their kinship caregivers, and foster families; Child care services in every state and Head Start programs that parents and employers rely on; Services for victims of domestic violence and human trafficking; Housing and job assistance for teenagers as they exit the foster care system and young people in the runaway and homeless youth system; Utility assistance to help people keep their heat on in the cold and air conditioner in the summer; and Temporary assistance for needy families to help Americans get through tough times. Pulling the rug out from children, families, and the American people at the toughest times of their lives, and when they are already facing rising costs, will be especially painful.
Need for Greater Clarity
Many questions remain about the scope of the directive to halt federal funds.
What is the universe of funding at risk under the directive? This requires clarity. The answer seems likely to hinge on the interpretations of federal administrators. The memo notes that the directive does not impact Social Security or Medicare payments or assistance provided directly to individuals. In addition to the memo, OMB also issued a Q&A guidance related to the memo. This Q&A states that Medicaid, Supplemental Nutrition Assistance Program (SNAP), and Head Start will continue without pause. These clarifying statements are important, especially as some federal funding payment systems have been inaccessible today. Furthermore, even with these clear exceptions, many consequential services and programs supported by federal funds remain at risk.
How Long Will Funds Be Paused? This is an open question. The memo directs federal agencies to report back to the White House based on their review by February 10. Courts and judicial actions will also have an impact on this as litigation proceeds.
Is it Legal to Pause Congressionally Appropriated Funds? This question is already being litigated, and a court has quickly intervened to halt the effects of this directive until at least Monday. We often hear of Congress as having the “power of the purse” because the U.S. Constitution grants Congress the power to impose taxes and spend revenues. In addition, the Impoundment Control Act also created controls to prevent unilateral executive actions that delay or cancel funding passed by Congress.
What’s Next? Children’s Action Alliance stands with our partners statewide who show up for children and families every day. We will share the potential impact of this and other federal actions with our congressional delegation and other Arizona leaders. All of us will continue to see news come out about new federal actions, litigation, and court decisions.
We will stay informed and share information so we can collectively take action to protect services for children and families. Join us in these efforts.
Is this pause in federal funds impacting you, your organization or children and families in Arizona? We are collecting stories to help shine a light on the potential impacts of loss of federal funds. Please consider sharing your story with us and collaborating to protect vital services for children and families.
