Federal funding freeze, thaw causes a stir locally

A federal spending freeze pursued by President Donald Trump this week sent state and local governments scrambling to understand potential ramifications. The White House later paused the order after a judge suspended the freeze on trillions of dollars moments before it was set to begin.

Still, state and local sources sought to get a handle on what a funding freeze could mean if it were allowed to proceed.

The state receives $1.9 billion in federal funding every month, a news release from the governor’s office said.

Democratic Gov. Tim Walz promised to see the president in court over the matter, saying the state will “keep the lights on,” but that ultimately it can’t make up for the loss of federal monies.

“President Trump has just shut off funding for law enforcement, farmers, schools, veterans, and health care,” Walz said. “I do not believe this decision was constitutional and we will work diligently to reverse it, but we are preparing for every eventual outcome to help Minnesotans weather this storm.”

Locally, Carlton County and the Fond du Lac Band both reacted by trying to understand actual impacts. Early assessments showed minimal immediate impacts — some county departments reported no impact, while others said they will have impacts, but were just figuring out the extent of the disruption in funding.

County coordinator Dennis Genereau said county administration was preparing a full report for the county board’s Feb. 4 committee of the whole meeting.

“This does impact the county, but to what extent at this time we are not sure,” Genereau told the Pine Knot. “The plan is to ask the board to consider using reserve funds to temporarily cover any funding gaps and avoid any service disruptions if possible.”

Federal grants and funding are used to supplement budgets in the county for everything from road and bridge construction to public health measures.

“We could lose grant funding for the services we provide in mental health, so therefore we could not do the outreach and direct service we’re doing with a lot of the families we work with,” Carlton County’s Annie Napoli said.

Napoli is the new public health and human services director for the county, replacing recently retired Dave Lee. She talked earlier this month about the prospect of a Trump presidency clamping down on federal funds.

“We have a continuity of operations plan,” Napoli said at the time. “So we have things in place if there are major cuts to keep things running smoothly and make sure the most vulnerable are being taken care of.”

County financial workers are also responsible for approving Medicaid expenditures to the tune of $300,000 per day and $100 million per year. Roughly 5,000 households — including seniors in long-term care and people with disabilities — are reliant on the federal funding.

Rep. Pete Stauber, R-Hermantown, said in a social media post this week that there was a lot of “misinformation being thrown around,” regarding the cuts. He maintained that student loans, food assistance, and Medicare and Medicaid were among the programs left untouched by the president’s measure.

“Any program that provides direct benefits to Americans is explicitly excluded from the pause and exempted from this review process,” Stauber noted on social media.

He went on to use social media to call the Trump order “good governance,” and “what the American people voted for,” adding that any pause on funding will be lifted for “worthy projects.”

Stauber seemed to be responding to reports of outages on the Medicaid website, as well as to Democratic Sen. Tina Smith calling the president’s order “devastating” for Minnesota’s tribal nations, which rely on federal funding for health care, food assistance and public safety and education.

“It’s unconscionable that the President would harm people like this,” Smith said before the White House paused the Trump order. “And I am going to fight this because it’s an outrage.”

Locally, Fond du Lac Band chairman Bruce Savage took to social media, addressing the funding in a lengthy statement, calling the immediate current impact “minimal.”

“At present, the Band is able to continue utilizing federal funds currently in its possession,” Savage said. “All Band programs will proceed as planned, and operations will remain uninterrupted.”

He noted that further clarification from the federal government showed the president’s order limited in scope, aimed at affecting previously issued executive orders, including “the termination of Diversity, Equity, and Inclusion initiatives, the Green New Deal, and funding for nongovernmental organizations that are not deemed to align with national interests,” the chairman’s statement said.

“Should the funding pause extend more broadly, the Band will take proactive measures to seek exceptions for tribal funding and will explore all available legal avenues to protect our interests,” Savage said.

The Band was going to continue to monitor the situation and post updates to its website, fdlband.org.

Meanwhile, Gov. Walz stressed the chaos of the moment.

“Shutting off this funding will have a devastating impact on people’s lives — from cancer patients, to securing our prisons,” he said. “President Trump is leaving states out in the cold without any guidance or explanation.”