Budget Director Annette Guzman speaks at a press conference Jan. 28, 2025. [Livestream]

Chicago budget office and law department officials were analyzing Tuesday just how much of the city’s $4.7 billion in grant funding would be affected by an order from the Trump administration to halt the spending of federal assistance for myriad purposes nationwide — if upheld by the courts.

The legality of the move has been challenged in court, and a federal judge temporarily blocked the pause from going into effect Tuesday, according to the Associated Press.  

“We don't know the full implications of what [the Office of Management and Budget (OMB)] actions will mean, and we don't know what potentially Congress will do based on the letter that came out,” Budget Director Annette Guzman said at a press conference Tuesday morning.  

Late Monday night, President Donald Trump’s budget office circulated a memo among the heads of executive departments and agencies to halt all spending of federal grants and loans that may not align with the president’s executive orders since taking office, “including, but not limited to, financial assistance for foreign aid, nongovernmental organizations, [diversity, equity and inclusion], woke gender ideology, and the green new deal,” according to a copy of the memo obtained by The Washington Post.   

The agencies must conduct “comprehensive” analyses of all the federal assistance dollars that may be going to things that conflict with the policy priorities and requirements laid out in Trump’s executive orders. The pause is to allow agencies to evaluate the federal spending for alignment with Trump’s priorities.  

“Financial assistance should be dedicated to advancing Administration priorities, focusing taxpayer dollars to advance a stronger and safer America, eliminating the financial burden of inflation for citizens, unleashing American energy and manufacturing, ending ‘wokeness’ and the weaponization of government, promoting efficiency in government, and Making America Healthy Again,” according to the memo.  

Direct assistance, such as food stamps or Pell Grants, is exempt from the directive.  

Guzman said she didn’t know anything for sure other than that a “portion” of the city’s federal funding could be affected. She said she could not name specific departments and programs that would be affected but would be talking with department heads about what the order could mean and what steps should be taken. 

Not only is there uncertainty about the city departments and programs that would be affected, there’s also uncertainty about whether Trump’s move is even legal. 

“These are unprecedented attempts … to defund childcare or to defund infrastructure projects,” Mayor Brandon Johnson said during the Tuesday morning press conference. “This is something that is well outside the purview of the executive office. These appropriations have been mandated by the legislative [branch].” 

On Tuesday, a group of state attorneys general announced they planned to file a lawsuit to block the freeze, including Illinois Attorney General Kwame Raoul. 

“On January 20th, our nation had a peaceful transfer of power, but let's be clear, January 20th was an inauguration, not a coronation,” Raoul said. “Congress is given the power to appropriate the funding. The executive branch cannot unilaterally disregard those appropriations passed by a separate and equal house of government. We will collectively fight this unconstitutional mandate.” 

Johnson said he had spoken with U.S. Sens. Dick Durbin and Tammy Duckworth Tuesday about the freeze, and they assured him they would continue to fight for the city and state’s federal funding. 

Earlier this month, Johnson, Durbin and other Illinois Congressional representatives celebrated the finalization of a full funding agreement that would provide $1.9 billion in federal dollars to the Chicago Transit Authority (CTA) to support the CTA Red Line Extension, which will extend the line from 95th Street to 130th Street. 

A CTA spokesperson told The Daily Line the agency doesn’t expect the Red Line Extension funding to be affected since it’s been secured through a full funding agreement, which “is a binding and legal commitment by the federal government to provide the committed and obligated funds.” 

The agency said its law department is reviewing the Trump administration’s directive to see if any future federal funds not tied to existing grant agreements would be affected. 

Cook County President Toni Preckwinkle said the county is closely reviewing the memo and will stay committed to protecting residents but declined to say how much of the county’s $435 million in grant funds for 2025 could be impacted. 

“The Trump administration’s directive to pause federal financial assistance is a dangerous overreach that threatens critical programs millions of Americans depend on, including affordable housing, food assistance and access to healthcare,” Preckwinkle said in a statement to The Daily Line. “This action creates unnecessary uncertainty for families, seniors and children who rely on these lifelines.”