Government Affairs Digest: What Nonprofits Need to Know (Part 12)
Updates on the federal funding freeze lawsuit filed by National Council of Nonprofits, the DOGE take over of grants.gov, the Harvard University funds freeze, and good news about reinstated HUD funds for both Enterprise and LISC’s Section 4 capacity building grants.
Plus additional readings, resources, webinars and actions to take including a survey from the Ga Center for Nonprofits.
April 16, 2025 - This content will be updated as developments unfold.
Latest Developments:
April 16: Billionaire Elon Musk's U.S. Department of Government Efficiency (DOGE) attempted to place a team with independent nonprofit Vera Institute of Justice, the nonprofit said, marking a further expansion of the cost-cutting agency's move to exercise control over non-governmental groups. It was not immediately clear how many other independent groups, such as Vera Institute, DOGE has contacted, but such a step would mark an increase in its influence beyond the government to private entities that received federal money.*
Read: DOGE attempted to assign team to US nonprofit group Vera Institute of Justice - Reuters
Relevant for: Any nonprofit receiving congressionally allocated funding
* This is a developing story that Purpose Possible will be monitoring
April 15: Tuesday, a Judge granted the National Council of Nonprofits and co-plaintiffs’ motion for a preliminary nationwide injunction preventing the Trump administration from freezing, haunting, or broadly pausing funding awarded under the Inflation Reduction Act or the Infrastructure Investment and Jobs Act. The judge further orders the administration to take immediate steps to resume the processing, disbursement, and payment of already-awarded funding appropriated under these laws, and to release awarded funds.
Read: From Diane Yentil, President & CEO of National Council of Nonprofits via LinkedIn
Relevant for: Any nonprofit, municipal body, or vendor providing services (such as construction, design, planning) to a municipality with grants awarded under these laws.
April 15: Staffers at the U.S. DOGE Service have taken control of Grants.gov, the website that disseminates information about federal grants and provides a mechanism for applying for the grants. According to unnamed sources referenced by The Washington Post, DOGE employees will now have the power to review and make decisions regarding the awarding of federal grants. The moves are part of a larger effort to limit resources for activities not endorsed by the Trump White House, according to the Post.
Grants.gov “provides a centralized location for grant seekers to find and apply for federal funding opportunities. Today, the Grants.gov system houses information on over 1,000 grant programs,” according to the website. These programs award more than $500 billion annually, per the website. The Grants.gov program management office was established in 2002, per the website.The site itself did not contain any information — or even indication — regarding the reported DOGE takeover. There were no indications of it within the unit’s X (formerly Twitter) feed. As of Saturday afternoon, the latest post on the X feed was from March 25.
Read: DOGE Takes Over Federal Grants Website - The Nonprofit Times
DOGE takes over federal grants website, wresting control of billions - Washington Post
Relevant for: Any nonprofit or for-profit that applies for funding through Grants.gov
April 14: The Trump administration cancelled $2 billion in funding to Harvard University after the school declined to comply with its demands. Those demands included overhauling its hiring practices and reporting international students who break campus rules. Harvard’s response, which called the Trump administration’s demands illegal, marked a major shift in tone for the nation’s most influential school, which has been criticized in recent weeks for capitulating to Trump administration pressure.
Since taking office in January, the Trump administration has aggressively targeted universities, saying it is investigating dozens of schools as it moves to eradicate diversity efforts and what it says is rampant antisemitism on campus. Officials have suspended hundreds of millions of dollars in federal funds for research at universities across the country.
Relevant For: Higher Education, Education, Democracy, First Amendment Rights
Resource: Chronicle of Higher Education Webinar: Understanding the New Legal Landscape: Navigating Uncertainty Under Trump ($89 Fee)
Some Good News:
April 11: The U.S. Department of Housing and Urban Development (HUD) has reinstated both Enterprise and LISC’s Section 4 Capacity Building for Community Development and Affordable Housing Program funding following a successful appeal that included petitions and testimonials from nonprofit partners across the country. This is a much-needed outcome for collaborative partners nationwide to advance housing and community development initiatives.
Read: LISC’s Section 4 Funding Reinstated, HUD Reaffirms Section 4 Partnership with Enterprise to Reduce Housing Costs
Relevant For: Housing, Economic Development, Capacity Building
Kermit The Frog Chosen as Inspiring Commencement Speaker for University of Maryland This Year (Good News Network)
Watch: Kermit on Creativity from TedX Talks: TedXJackson 2014
Resources:
Funder Briefing: The First 100 Days: Our Communities are Our Responsibility April 29th, 2pm EST presented by Grantmakers for Southern Progress
Bay Watch (2025 Legislative Update) Friday, April 25th – 12:00pm – 1:00pm (Via Zoom) (DC, MD and Virginia)
Further Reading:
National Council of Nonprofits Calls to Defend Nonprofit Nonpartisanship (National Council of Nonprofits)
70-Plus Foundations ‘Meet the Moment’ and Pledge to Increase Their Grants (Chronicle of Philanthropy)
Recession Ahead? How a Tariff-Induced Downturn Might Change Giving (Chronicle of Philanthropy)
A Tariff ‘Tidal Wave': Higher Costs, Donor Pullback, More Budget Pain (Chronicle of Philanthropy)
6 Ways Nonprofit Leaders Can Boost Morale in Chaotic Times (Chronicle of Philanthropy)
Actions to Take
Impact of Federal Policy & Funding Changes on GA nonprofits - Contribute to Georgia Center for Nonprofit’s survey
10,000 Job Cuts in 70 Days. Introducing the Nonprofit Layoff Tracker - Contribute to Chronicle of Philanthropy’s monthly estimate of nonprofit job losses by sector.
Government Affairs Digest: What Nonprofits Need to Know (Part 11)
Updates on the latest lawsuits filed to stop an Executive Order from dismantling three agencies under the National Endowment for the Humanities, the developing complaints filed by the conservative American Alliance for Equal Rights against three non-profits, and a breakdown of the Georgia Legislative Session which ended 4/4/25.
Plus additional readings, resources, and actions to take including ones for funders.
April 9, 2025 - This content will be updated as developments unfold.
Latest Developments:
April 4: A lawsuit was filed by 21 State Attorneys General to stop President Trump's Executive Order #14238 from dismantling 3 federal agencies that provide services and funding for museums and public libraries, mediation services, and minority business development. Specifically, the Institute of Museum and Library Services was forced to place 85% of its staff on administrative leave and cancel all open grants on 3/31/25. This lawsuit is led by the Attorneys General of New York, Hawaii, and Rhode Island and are joined by Arizona, California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, Oregon, Vermont, Washington state, and Wisconsin.
The lawsuit argues that the executive order violates the Constitution and the Administrative Procedure Act by eliminating the programs of agencies without any regard for the laws and regulations that govern each source of federal funding. The coalition argues that the President cannot decide unilaterally to override laws governing federal spending, and that this executive order unconstitutionally overrides Congress’ power to decide how federal funds are spent.
Read: Read more about this update from Americans for the Arts
A Message to Our Friends and Supporters: Take Action to Save the NEH - Georgia Humanities
Relevant for: Libraries, Museums, Historians, Academia, Minority Business Development, Mediation Services
April 1: The conservative American Alliance for Equal Rights (AAER) formally filed complaints with the Internal Revenue Service (IRS) to open investigations regarding three prominent tax-exempt charitable organizations—the Gates Foundation, Lagrant Foundation, and Creative Capital Foundation—"intentionally discriminating against white people." The complaints request the IRS revoke their tax-exempt 501(c)(3) charitable status.
Read: More about this update from Americans for the Arts (Press Release)
Relevant for: Public Health, Mental Health, Addiction Services
Georgia Legislative Session Report:
The 2025 Georgia Legislative Session wrapped on Friday, April 4, as the Georgia Senate decided to adjourn earlier than previous sessions. As a result, and even with 260 bills and numerous resolutions being passed, the 2025 Session will be remembered by some as much for the legislation that did not reach Governor Brian Kemp’s desk.
Among the bills that will proceed to Governor Kemp’s desk include many that address hot-button, cultural issues that impact the nonprofit community:
Bills that impact the nonprofit community that did not pass during the 2025 Session include:
Red Tape Rollback Bill - Georgia’s answer to the federal DOGE cuts.
A ban on coverage of transgender-related care for employees on the state health plan.
The Georgia Legislature also passed the 2026 budget, House Bill 68 - the only legislative piece that they are required to pass yearly. For some highlights on the 2026 budget, please read the Georgia Budget and Policy Institute’s Legislative Wrap-up.
For additional information on bills that did and did not pass in the 2025 Georgia Legislative Session, please visit WABE’s 2025 Gold Dome Tracker & the AJC’s Georgia Legislative Navigator.
As a final reminder, please note that the Georgia General Assembly operates on a two-year cycle, meaning the legislative session is a non-consecutive 40-day period beginning in January, and bills that don't pass during the first year can be considered again the following year. The 2025 Legislative Session was the first year of the current two-year cycle.
SOME GOOD NEWS:
Growing and Sharing Seeds Can Boost Mental Health - Positive.News
Massive sea turtle back where it belongs after Florida photographer, rescue group step up - Today
Actions to Take:
4/24/25 Webinar: The Backlash to Diversity, Equity & Inclusion (DEI): How Justice-Committed Organizations Can Respond Now (NPQ)
Help the National Council of Nonprofits tell the story of the true value and tremendous positive impacts of nonprofits in communities every day by sharing your nonprofit's story here
For funders:
Philanthropy’s solidarity with those impacted by aid cuts: A joint Call to Action (WINGS)
Meet the Moment: A Call to Action for Philanthropy in 2025 (and Beyond) (Trust-Based Philanthropy Project,Grantmakers for Effective Organizations, and NCFP)
Resources:
The Lawyers for Good Fund Protection Clinic offers legal assistance to organizations. Their attorneys provide generalized best practices guidance and customized templates to build your administrative record. Pro bono 1:1 consultations are available to EPA, USDA, and DOE grantees.
Webinar recording: The Legal Landscape and Path Ahead for Nonprofits and Philanthropy (National Council of Nonprofits)
Executive Actions and their Impacts on the Arts: A Comprehensive Guide (Americans for the Arts)
Further Reading:
What’s at Stake with Threatened Federal Cuts to CDFIs? (NPQ)
The Case for Solidarity Between Nonprofit and Federal Workers (NPQ)
The Legal Landscape Around DEI Is Shifting. Your Messaging Should, Too. (Harvard Business Review)
What Can Philanthropy Do as Trump Pushes Legal Boundaries on Immigration? (Inside Philanthropy)
Recession Ahead? How a Tariff-Induced Downturn Might Change Giving (Chronicle of Philanthropy)
Leading through Uncertainty: Three Questions for Funders (FSG)
Government Affairs Digest: What Nonprofits Need to Know (Part 10) - Updated 4/4/25
Updates on the latest Executive Orders aimed at elections, the Smithsonian and the Institute of Museum and Library Services. Additional updates on the recent challenges to NPR and PBS, funding cuts form the Dept. of Health and Human Services, and a look at ongoing developments as a judge considers the new NEA grant guidelines.
Plus additional readings and resources including updates on required certifications for recipients of federal funding and upcoming webinars.
April 4, 2025 - This content will be updated as developments unfold.
Latest Developments:
April 4: NEA Special Update
Key takeaways from Theatre Communications Group who is part of the ACLU-led lawsuit challenging the National Endowment for the Arts’ funding restriction tied to “gender ideology.”
As a reminder: the current state of the application process is that the NEA temporarily removed the restriction that forced applicants to agree that they will not “promote” what is being referred to as “gender ideology” in order to receive federal funding.
In addition, the NEA advised the judge on March 7th that the NEA was in an internal process of evaluating how the executive order would be implemented.
The NEA has not yet finalized how it will apply the restriction (including whether it may be reinstated), but it has indicated a decision may come after April 30.
This ruling does not prevent the NEA from reimposing the restriction.
With this ruling, the court has given a preliminary review of the strength of our argument and that review suggests reinstating the “gender ideology” criteria would be unlawful.
Read: Explanation of ruling from Theatre Communications Group
Resource: EXECUTIVE ACTIONS & THEIR IMPACT ON THE ARTS: A Comprehensive Guide
Call to Action from Americans for the Arts: URGENT UPDATE: Special Session Today
Join us today, April 4th at 4:00 PM ET for a critical Office Hours discussion on the unprecedented changes at federal cultural agencies. Featuring key representatives from ACLU Rhode Island, National Humanities Alliance, American Library Association, and Federation of State Humanities Councils. Register now for this crucial conversation about protecting federal support for arts and culture.
We’ll address:
IMLS staff administrative leave situation
DOGE’s recommendation of severe cuts to NEH
Potential impacts on NEA and other agencies
Latest developments in ACLU’s NEA lawsuit
March 25: President Trump signed an executive order entitled “Preserving and Protecting the Integrity of American Elections,” seeking to make changes to the way federal elections are administered at the state level, which will be challenged in court as unconstitutional per Article I, Section 4, Clause 1 of the Constitution. It has been noted that the executive order inaccurately describes the rules of nonprofit lobbying with federal funds.
Read: Executive Order on Election Administration - Nonprofit Vote
Relevant for: Any American voter, Nonprofits focused on voter access
March 26: The U.S. Department of Health and Human Services canceled around $12 billion in federal grants to states that were allocated during the COVID-19 pandemic. The grants were being used to track, prevent, and control infectious diseases, including measles and bird flu, as well as track mental health services and fund addiction treatment.
Read: US pulls back $12 billion in funding to state health departments - Reuters
Relevant for: Public Health, Mental Health, Addiction Services
House DOGE Subcommittee Chair Marjorie Taylor Greene (R-GA) held a hearing on “Anti-American Airwaves: Holding the Heads of NPR and PBS Accountable.” President Trump is expected to sign a threatened executive order to defund federal funding for the Corporation for Public Broadcasting, which partially funds these two public media outlets. Note: This move would harm rural communities the most, as stations in larger markets fundraise to support the majority of their operations, and rural stations rely heavily on CPB funds.
Watch: PBS and NPR leaders testify on federal support for public broadcasting in House hearing
Relevant for: Nonprofit Media, Democracy-focused orgs, Rural Access
March 27: President Trump signed an executive order entitled "Restoring Truth and Sanity to American History," aiming to eliminate "divisive, race-centered ideology" from federal historical institutions. The order directs Vice President Vance to oversee the removal of such ideologies from the Smithsonian Institution's museums, educational and research centers, and the National Zoo. Among the other directives in the executive order, it also instructs the Secretary of the Interior to investigate similar "divisive, race-centered ideology" found on federal monuments, memorials, statues, and markers within the Secretary’s jurisdiction.
Read: Trump executive order seeks to 'restore' American history through Smithsonian overhaul - NPR
Relevant for: Education, Researchers, History, Arts, Humanities, Museums
Senior U.S. District Court Judge William Smith of Rhode Island heard arguments concerning the constitutionality of complying with President Trump’s “gender ideology” Executive Order #14168, linked to the National Endowment for the Arts new grant guidelines. While Judge Smith did not promise an injunction, he said he would help get the plaintiffs "out of this 'Hobson's choice' they have to make about whether to submit a proposal they want to submit versus the proposal they think they might have to submit." A ruling is expected on 4/3/25 or by the morning of the following day.
Read: LGBTQ+ theater groups have day in court over endangered arts funding - Rhode Island Current
Relevant for: Arts & Culture, Artists & Curators, Creative Placemaking
March 31: All Institute of Museum and Library Services staff were put on administrative leave two weeks after President Trump issued an executive order naming the independent agency as one of seven that should be “eliminated to the maximum extent consistent with applicable law.”
Trump Administration Moves to Shutter Library Agency - New York Times
AAM Statement on the Placing of IMLS Staff on Administrative Leave - American Alliance of Museums
IMLS Interactive Map of Grantees - IMLS
Relevant for: Education, Researchers, History, Arts, Humanities, Libraries
SOME GOOD NEWS:
Press 3 for a pep talk from kindergartners. A new hotline gives you options for joy - NPR
Alysa Liu is first U.S. woman to win figure skating world title in 19 years (NBC Sports) - If you haven’t watched Liu’s free skate performance, we highly recommend it!
Yes, You Do Make a Difference. Here's How—Backed By Science - Psychology Today
Resources:
The Impact Map provides timely data—as it becomes available—on policy, funding, and workforce changes and their localized effect.
Georgia 2025 Gold Dome Bill Tracker - WABE
FAQs on Responding to Recent DEI Executive Orders - Public Counsel
Nonprofits and the New Administration - Pro Bono Partnership of Atlanta’s resource page is regularly updated.
Updates for Organizations with DEI Questions - Pro Bono Partnership of Atlanta
Navigating Major Government Changes: Strategic Conversations Your Board Should Be Having Now - Pro Bono Partnership of Atlanta
Tracking Federal Actions Impacting the Nonprofit Sector - GrantStation
Webinar Series: TargetED Series: Shifting Perspectives to Enhance Your Grant Competitiveness. A six-part series beginning on April 14th presented by GrantStation.
Further Reading:
Association of Corporate Citizenship Professionals 2025 Pulse Survey
PRIMARY TAKEAWAY: Corporations remain committed to corporate social responsibility programs and initiatives with 90% of respondents indicating they anticipate their company’s commitment will stay the same or increase under the new Presidential administration because there are substantial business benefits of these programs including improved recruitment and retention, revenue growth and strengthening trust and brand loyalty.
Sustaining the Safety Net: How Service Providers are Navigating Political Uncertainty - Building Movement Project
Data Visualization: What Is the Financial Risk of Nonprofits Losing Government Grants? - Independent Sector
Advocacy in a Post-Election Year - Nonprofit Law Blog
Fitzgerald, Baskin and Riley: Your favorite Atlanta nonprofit is at risk - AJC
Government Affairs Digest: What Nonprofits Need to Know (Part 9)
Updates on a select number of education grants that have been temporarily reinstated by a Judge in Maryland, the partial restoration of USAID operations by a Judge’s ruling, and the executive order to close the Dept. of Education.
Plus additional readings and resources including upcoming webinars and a few snippets of good news.
March 26, 2025 - This content will be updated as developments unfold.
Latest Developments:
March 17: U.S. District Judge Julie Rubin in Maryland ordered the Trump administration to temporarily reinstate some of the education grants it had nixed as part of its work to end DEI initiatives. These grants, funded under three Congressionally appropriated programs—Supporting Effective Educator Development (SEED) Program, Teacher Quality Partnership (TQP) Program, and Teacher and School Leader Incentive (TSL) Program—were used to support programs that prepare and develop educators.
Read: Judge orders reinstatement of education grants axed by Trump in DEI sweep
March 18: Judge Theodore D. Chuang ruled that Elon Musk and his team likely violated the Constitution by shutting down USAID, infringing on Congress’s authority. He ordered the partial restoration of USAID operations, reinstatement of employee email access, a reoccupation plan for evicted employees, and barred Musk’s team from further involvement in the shutdown.
Read: Maryland judge temporarily blocks DOGE efforts to dismantle USAID - The Washington Post
March 20: United States President Donald Trump signed an executive order that ordered the Secretary of Education to facilitate the closure of the Department of Education. The President cannot fully close the Department without approval from Congress because only the legislature has the discretion to close a cabinet-level department. Student loan administration, including Public Service Loan Forgiveness, is being transferred to the Small Business Administration.
Trump Administration Is Sued Over Push to Dismantle Education Department - The New York Times
SOME GOOD NEWS: Fewer People are Dying from Drug Overdoses, the Mediterranean Monk Seal is Making a Comeback, Lincoln Center Receives a Record-Breaking $50 Million Gift for Contemporary Dance, and more from Vox.
Actions to Take:
Help Expand Nonprofit Financial Commons’ 12 Financial Action Steps for Nonprofits!
Nonprofits must stay financially strong to sustain their missions, and the 12 Financial Action Steps provide a great foundation. But we know there’s always more to consider! What key advisory points would you add to strengthen these steps?
Resources:
List of Withdrawn Federal Funding Opportunities - Resource generated by members of the Grant Professionals Association as a way to track all previously recurring grant opportunities that have disappeared in the last few weeks. It's a crowd-sourced resource, so if you know of opportunities missing from the list, please feel free to add!
Chronicle of Philanthropy Webinar Recording “Nonprofits and the Trump Agenda 3.25.25”
Key Findings:
The overwhelming majority of nonprofit leaders say the current political climate is negatively affecting their organizations.
Nonprofit leaders are seeking more communication from their foundation funders about the implications of the political context but indicate that most of their funders have not yet communicated with them.
Worries about current and future funding levels as well as changing funder priorities are top of mind for nonprofit leaders, who are looking for larger and more unrestricted support in this uncertain time.
Further Reading:
Inside the Federal Funding Freeze - Non Profit News | Nonprofit Quarterly
In a Time of Nonprofit Defunding, Will Foundations Put More Money on the Line?
Facing Federal Defunding, Nonprofits Draft Best and Worst Case Budgets
Pivoting to Private Donors When Government Funding Isn’t There
The Silence of Our Friends- Public Welfare Foundation’s statement and call-in for philanthropic funders' lack of action and silence against the current unprecedented attack on the nonprofit sector.
Government Affairs Digest: What Nonprofits Need to Know (Part 8)
Updates on affordable housing funding contract cuts, two executive orders targeting DEI efforts have been reinstated, and additional US agencies like the Institute of Museum and Library Services may be forced to shut down. On a positive note, a judge has blocked the EPA from reclaiming climate-related grants from three organizations.
Plus additional readings and resources including upcoming webinars.
March 19, 2025 - This content will be updated as developments unfold.
Latest Developments:
March 3: The Trump administration has stalled at least $60 million in funding intended largely for affordable housing developments nationwide, throwing hundreds of projects into a precarious limbo, according to information and documents obtained by The Associated Press.
The move is part of a flurry of funding freezes, staffing cuts and contract cancellations by the Trump administration at the U.S. Department of Housing and Urban Development, changes that have instilled widespread uncertainty in the affordable housing industry. The $60 million is intended to go to small community development nonprofits in small grants. The money is often used as seed funding for affordable housing projects, turning a concept into a viable development and consequently drawing in more public and private investment. Congress chose three nonprofits to distribute the grants, but HUD said in letters that it was canceling contracts with two of the organizations, which together were to distribute the $60 million. That’s pushed millions in funding already promised to small nonprofits, or yet to be awarded, into the twilight zone.
Trump’s Funding Freeze Halts Hundreds of Affordable Housing Projects - TIME
Relevant for: Housing, Community Development, Economic Development
March 12: Biden-appointed National Endowment for the Humanities (NEH) Chair Shelly Lowe was ordered to leave her position “at the direction of President Trump.” NEH General Counsel Michael McDonald will serve as Acting Chair.
Read: Trump pushes out National Endowment for the Humanities chair, official says - The Hill
Relevant for: Arts & Culture, Humanities, Museums, Archives, etc.
March 13: National Council of Nonprofits filed a lawsuit challenging the Trump administration’s unlawful freeze on funding from the congressionally-approved Inflation Reduction Act (IRA) and the Infrastructure Investment and Jobs Act (IIJA), also known as the Bipartisan Infrastructure Law—critical investments that help communities combat climate change, improve infrastructure, and protect public health. The freeze, ordered through President Trump’s “Unleashing American Energy” executive order and implemented by the Office of Management and Budget, Environmental Protection Agency, and the Departments of Agriculture, Energy, and the Interior, has left vital community projects in limbo—hurting public lands, clean energy initiatives, local economies, and communities.
Read: Press Release
Relevant for: Environmental Sustainability, Climate Change, Climate Justice, Clean Energy, Preservation of Public Lands, etc.
March 14: A federal appeals court has given President Donald Trump’s administration the go-ahead to enforce a pair of controversial executive orders that seek to root out diversity, equity and inclusion efforts at federal agencies and government contractors.
The three-member appeals panel — including two judges appointed by Democratic presidents lifted a lower court’s injunction that had put the policy on hold last month. The ruling Friday from the panel of the Richmond, Virginia-based 4th Circuit Court of Appeals is not a final decision on the legality of Trump’s anti-DEI policy. It merely allows the government to administer the policy while litigation continues.
Read: Appeals court allows Trump to reinstate two executive orders targeting DEI - Politico
Relevant for: Any organization with programming related to or incorporating principles of diversity, equity, or inclusion.
March 15: President Donald Trump has signaled the next set of agencies on the chopping block, as his administration looks to cut down the size of the federal government. Trump, in a late Friday executive order, gutted several smaller offices and agencies that serve wide-ranging roles in the government, from addressing homelessness to funding libraries. The order said the agencies and offices will have all of their federal grants reviewed and they will be “eliminated to the maximum extent consistent with applicable law.” On the list is the U.S. Agency for Global Media, which oversees Voice of America and Radio Free Asia, and the Institute of Museum and Library Services.
Read: Trump’s next agency cuts include US-backed global media, library and museum grants - Politico
Relevant for: Museums, Archives, Libraries, Humanities, Arts, Media
March 19: SOME POSITIVE NEWS: This week, a federal judge issued a temporary restraining order blocking the Environmental Protection Agency (EPA) from reclaiming climate-related grants from three environmental organizations. The EPA had attempted to terminate these grant agreements, citing concerns of fraud and abuse. However, the judge found these claims to be vague and unsupported by clear evidence, and noted that without the order, the organizations would face imminent harm, including the inability to pay employees and continue their projects. This decision allows the nonprofits to maintain their funding and continue their environmental initiatives.
Read: US judge blocks Trump's EPA from clawing back climate grants - Reuters
Relevant for: Organizations dealing with climate-related grants
Resources:
National Council of Nonprofits Webinar held 3/17/25: The Legal Landscape and Path Ahead for Nonprofits and Philanthropy (1:02:23) recording and slides.
Chronicle of Philanthropy Webinar 3/25 at 2pm: Nonprofits and the Trump Agenda Webinar, Register Here
Breaking News Updates Impacting the Arts & Culture | Arts ActionFund
Government Affairs Digest: What Nonprofits Need to Know (Part 7)
Updates on the USDA funding cuts impacting two key programs, how nonprofits are continuing to respond with lawsuits, and a potential government shutdown by the end of this week including a potential $1B budget cut for DC alone.
Plus additional readings and resources including upcoming webinars and actions to take when planning to have difficult conversations with your team or Board of Directors.
March 12, 2025 - This content will be updated as developments unfold.
Latest Developments:
The USDA Cuts Funding: On Monday, March 10, the U.S. Department of Agriculture (USDA) announced cuts of over $1 billion in funding for two key programs aimed at supporting schools and food banks. The $660 million Local Food for Schools program, which helps schools buy food from local farms, and the Local Food Purchase Assistance Cooperative Agreement Program, which would have funded $500 million to support food banks, are both being discontinued for 2025. This move comes amid ongoing trade tensions and economic difficulties faced by U.S. farmers and food organizations.
Nonprofits Continue to Respond: Numerous groups have filed lawsuits over funding freezes and sudden changes to regulations.
Judge orders Trump administration to speed payment of USAID and State Dept. debts | AP News
Environmental NGO sues Trump's EPA, Citibank over funding freeze | Reuters
Obama's top Supreme Court lawyer files lawsuit over Trump funding freeze | Reuters
Potential Government Shutdown: On Tuesday, March 11th, the House passed a bill to fund the government through September 30 and avert a shutdown at the end of the week. The bill passed the House 217-213, with only one Democrat voting in favor. The Senate has until the end of the day Friday, March 14th, to vote on the CR (Continuing Resolution). Senate Republicans control 53 seats and would need at least eight Democratic votes to reach the 60-vote threshold needed to overcome a filibuster and pass the CR.
Read: Potential government shutdown approaches as March 14 deadline looms. Here's what to know. - CBS News
Read: The Uphill Battle: Nonprofits Fighting to Keep Our Neighbors Housed - SaportaReport
For our DC-based clients: The CR passed by the House would lead to an immediate $1B cut to the FY25 DC budget, including significant cuts to DC public schools, MPD, Fire and Emergency Medical Services, WMATA, DHS, and more.
Read: DC braces for $1 billion budget cut after House ignores spending bill plea
Action: The Senate could vote on the bill as soon as Wednesday night. Call the Senate today and every day until the vote using this script and list of priority legislators.
Further Reading:
For regular, happy news - Vox has launched Good News, a weekly newsletter that’s here to swap your doomscrolling for a dose of hope and positivity. Sign up here.
Actions to Take:
Having Difficult Conversations: Tools for Talking about Tough Topics with Your Team or Board
Active listening keeps both the speaker and listener fully engaged by fostering understanding, response, and retention. You can employ these techniques to communicate effectively about any topic, but especially when navigating challenging issues.
Active Listening in Action
Observe: Pay attention to body language & behavior.
Engage: Use visual cues (nodding, eye contact) & ask clarifying questions.
Minimize Distractions: Silence notifications & avoid interruptions.
Stay Open-Minded: Focus on making the speaker feel heard, not on judging or responding.
Verify Understanding: Reflect and confirm key takeaways.
Be Ready: Keep your active listening skills sharp for all coaching moments.
The 6 Core Active Listening Techniques
Pay Attention – Give full focus to the speaker.
Withhold Judgment – Listen without jumping to conclusions.
Reflect – Repeat and paraphrase to ensure understanding.
Clarify – Ask questions to deepen comprehension.
Summarize – Restate key points for alignment.
Share – Offer thoughtful insights when appropriate.
Work to build a listening culture that is followed by action. Strong active listening builds trust, fosters open communication, and creates a supportive coaching environment for nonprofit leaders and their teams.
*Summarized from Communicating in a Crisis: What, When, and How - Center for Creative Leadership
Resources:
The Legal Landscape and Path Ahead for Nonprofits and Philanthropy
National Council of Nonprofits
Monday, March 17 at 3:00 pm Eastern
Uncharted: Navigating the New Federal Landscape
The Southern Economic Advancement Project’s monthly webinar series
Thursday, March 20th at 1pm EST
Speakers include Bernie Kluger, Former Senior Advisor for Management at USDA
Updated Resources from National Council of Nonprofits
Government Affairs Digest: What Nonprofits Need to Know (Part 6)
The National Council of Nonprofits (NCN) filed a new motion and declaration in their case of NCN v OMB (Office of Management & Budget).
A divided Supreme Court turned down a request by the Trump administration to block $2 billion in foreign-aid reimbursements for work already completed.
Plus additional readings and resources.
March 5, 2025 - This content will be updated as developments unfold.
Latest Developments:
March 2: National Council of Nonprofits (NCN) filed a NEW motion and declaration in our case of National Council of Nonprofits v OMB (Office of Management & Budget). NCN is asking the judge to clarify that Continuum of Care (CoC) grants that have already been awarded are covered under the court’s Preliminary Injunction preventing the administration from implementing broad federal funding freezes.
Background: In late January, HUD awarded $3.6B in CoC grants to 7,000 grantees providing the full continuum of outreach, shelter, services, housing to people experiencing homelessness. The funding hasn’t been disbursed and the delay is causing concern - soon, it may cause service disruptions or closures.
Read: Diane Yentel, President & CEO National Council of Nonrofits (LinkedIN)
Relevant for: Housing, Affordable Housing, Homelessness, Supportive Housing Organizations
March 3: A divided Supreme Court on Wednesday turned down a request by the Trump administration to lift an order by a federal judge in Washington, D.C., that had directed the State Department and the U.S. Agency for International Development to pay nearly $2 billion in foreign-aid reimbursements for work that has already been done.
In a brief unsigned opinion, the court noted that the Feb. 26 deadline for the government to make the payments had already passed. It instructed U.S. District Judge Amir Ali to “clarify what obligations the Government must fulfill to ensure compliance” with the temporary restraining order that Ali has entered in the case, paying attention to how feasible it is for the government to comply with those timelines.
Ali is expected to hold a hearing on the aid groups’ motion for a preliminary injunction – which, if granted, would suspend the freeze on foreign-assistance funding going forward – on Thursday, March 6. This means that the dispute could return to the Supreme Court as an emergency appeal again soon.
Read: Supreme Court denies Trump request to block $2 billion foreign-aid payment - SCOTUS Blog
Relevant for: Any organization with programs or partners receiving USAID funding.
Actions to Take:
Review the tools and recommendations available in our earlier Government Affairs Digests and consider scheduling a Scenario Planning Session with Purpose Possible.
Further Reading:
What does ED’s New DEI Guidance Really Mean? - Inside Higher Ed
Trump Moves Cause Widespread Fear Among Nonprofits, Survey Finds - Non Profit News | Nonprofit Quarterly
Challenging Times: How U.S. Nonprofit Leaders are Experiencing the Political Context - Blog Post | The Center for Effective Philanthropy
Government Affairs Digest: What Nonprofits Need to Know (Part 5)
Executive Order “Ending Taxpayer Subsidization of Open Borders” was filed.
On Friday, February 21, 2025, a federal district court in Maryland issued a preliminary injunction blocking enforcement of several key provisions of executive orders targeting DEI programs.
Make your voice heard through Nonprofit Finance Fund’s 2025 State of the Nonprofit Sector Survey.
February 26, 2025 - This content will be updated as developments unfold.
Latest Developments:
February 19: Executive Order “Ending Taxpayer Subsidization of Open Borders” was filed. This EO directs federal departments and agencies to identify federally funded programs that “illegal aliens” can access, including cash and non-cash public benefits, and ensure payments to states and localities do not subsidize or promote “illegal immigration” or “abet so-called ‘sanctuary’ policies.”
Read: Executive Order on “Ending Taxpayer Subsidization of Open Borders” - Economic Policy Institute
Read: Somerville Sues The President Over Immigration Laws
February 21: “On Friday, February 21, 2025, a federal district court in Maryland issued a preliminary injunction blocking enforcement of several key provisions of the January 2025 executive orders targeting DEI programs. The nationwide injunction blocks the federal government from requiring federal contractors and grantees to certify they do not operate DEI programs that violate federal anti-discrimination laws, and from bringing enforcement actions, including False Claims Act claims, premised on these certifications. The order allows other enforcement provisions, such as the Attorney General’s preparation of a report identifying potential civil compliance investigations of major organizations, to continue.” - Seyfarth Shaw
Read: Federal Court Issues Nationwide Preliminary Injunction Blocking Enforcement of Key Provisions of DEI Executive Orders - Seyfarth Shaw LLP
Read: Nonprofits Sue Over Trump’s “Anti-Equity” Orders - Non Profit News
February 25: On Thursday, February 25, 2025 the U.S. District Court for the District of Columbia granted a preliminary injunction of the OMB’s freeze on federal grant disbursements that has put essential services across the nation in jeopardy, in response to a suit filed by Democracy Forward on behalf of the National Council of Nonprofits, the American Public Health Association, Main Street Alliance, and SAGE.
What does this mean?
“The preliminary injunction is a tremendous relief for thousands of nonprofit organizations throughout the country that are struggling to continue their vital work in the midst of the chaos and confusion caused by the administration’s attempted federal funding freezes. These organizations have been left to wonder whether they’ll be reimbursed for their vital work, or if they’ll need to shut down essential programs. OMB’s reckless federal funding freeze would cause catastrophic and irreversible harm to nonprofits and the communities and people they serve. This preliminary injunction allows such nonprofits to continue with their important work of providing wildfire mitigation, disaster relief, services to survivors of domestic violence, support for our nation’s veterans, and so much more.” said Diane Yentel, President and CEO of the National Council of Nonprofits.
Read: Judge Issues National Injunction to Block Trump Administration’s Devastating Attempt to Halt Funding For Essential Services
Read: Federal judge blocks Trump funding freeze, saying it produced a ‘nationwide crisis’
Actions to Take:
Nonprofit Finance Fund’s 2025 State of the Nonprofit Sector Survey is now live! Add your voice today.
There has never been a more critical time to share what’s going on for nonprofits and how we all can support the organizations that play an essential role in our communities. Make your voice heard through Nonprofit Finance Fund (NFF)’s 2025 State of the Nonprofit Sector Survey. Conducted in partnership with EVITARUS, NFF’s survey will gather data about timely social sector issues such as federal funding, real estate ownership, workforce and staffing, the implications of political events, racial equity in nonprofit finance, and other topics relevant to creating community wealth and well-being. This year, a collective of local funders is supporting NFF to do a special analysis of the Georgia nonprofit sector, and your response is needed to tell that story.
We are proud to help NFF raise our sector’s voices. Survey findings will be shared publicly in late 2025. Results are widely used by nonprofit leaders and boards, funders, advocates, policy advisors, media, and researchers. NFF and its local partners will amplify your aggregated, anonymized voices to those who fund and support your invaluable work, advocating for what you need to serve now and well into the future.
Please take the survey today and join this collective effort. It will take only about 25-35 minutes and will be a valuable contribution to data for our sector.
From Purpose Possible
Purpose Possible will begin offering a 2-hour Scenario Planning Facilitated Session to clients that are determining if specific adjustments may be needed to their operational, programmatic, or communications strategy that may be affected by the current administration. An expert nonprofit consultant will lead you through an intentional examination of your current status and setting relevant next steps.
Outcomes/Deliverables
Clients will have a better understanding of threats or opportunities they may face now or in the near future.
Clients will examine the financial implications of any potential shifts.
Clients will have a plan for next actionable steps.
If you are an existing client, please reach out to Kari Hudson or Starsha Valentine if you would like to learn more. If you are not a current Purpose Possible client, please submit an inquiry form on our website.
Resources:
Nonprofit Legal Compliance in an Unfriendly Political Environment - Non Profit News
Webinar: DeVos Institute of Arts and Nonprofit Management: Practical Tools to Respond to Recent Executive Orders and Changes in NEA Guidelines, Monday, March 3, 3:30–5:00 PM ET via Zoom; Free of Charge Registration Required
Harvard University Library’s Innovation Lab released its archive of data.gov as part of its data vault project. The collection already includes over 311,000 datasets retrieved from 2024 and 2025, representing “a complete archive of federal public datasets linked by data.gov.”
Government Affairs Digest: What Nonprofits Need to Know (Part 4)
2025 has felt eerily similar to 2020—only more divided and chaotic. With government funding reductions and broader challenges facing nonprofits, especially those rooted in DEI-focused work, I found myself instinctively reaching out to fellow nonprofit leaders just to check in. But it quickly became clear that we all needed more.
Kate Hewitt, Executive Director of 21st Century Leaders
February 19, 2025 - This content will be updated as developments unfold.
“2025 has felt eerily similar to 2020—only more divided and chaotic. With government funding reductions and broader challenges facing nonprofits, especially those rooted in DEI-focused work, I found myself instinctively reaching out to fellow nonprofit leaders just to check in. But it quickly became clear that we all needed more. Purpose Possible has positioned itself as a trusted industry leader, resource, and advocate, so it was no surprise that Susannah and Laura helped turn that need for “more” into a truly impactful conversation. There’s an energy and urgency here that I hope we all carry forward—not just to keep the conversations going, but to take action through strategy, collaboration/unity, and accountability.”
Executive Exchange:
On Wednesday, February 12, 2025, in response to Kate’s timely suggestion, Purpose Possible gathered nonprofit leaders from across Metro Atlanta to share and strategize. The attendees represented a cross-section of the sector, including the smallest and largest organizations in our region, as well as a variety of sub-sectors such as housing, homelessness, and youth development. The conversations were candid and thoughtful, and everyone agreed they were much-needed.
The takeaways from this gathering are shared with you here
Purpose Possible is working diligently to understand what is most needed for nonprofit organizations in Atlanta. Over the coming weeks, we will continue to thoughtfully curate resources from expert partners and news highlights while we engage with nonprofits and funders across sectors and budget levels. We welcome suggestions on how we can best support the sector - if you see a particular need or are seeking a particular resource, let us know! Stay tuned to our website and newsletter for upcoming opportunities to be in community with your peers and Purpose Possible.
Navigating the Federal Funding Freeze: What Nonprofits Need to Know (Part 3)
The DOJ issued a directive to begin civil and criminal investigations of NGOs and other private companies engaged in "illegal" DEI work
Secretary Turner announced in a press conference that HUD would immediately halt any pending or future enforcement actions related to HUD’s 2016 Equal Access Rule.
A federal judge has blocked efforts to cut the NIH’s “indirect costs” in the funding it provides to research grants by 50%.
February 13, 2025 - This content will be updated as developments unfold.
Latest Developments:
February 5: The DOJ issued a directive to begin civil and criminal investigations of NGOs and other private companies engaged in "illegal" DEI work. (Ending Illegal DEI and DEIA Discrimination and Preferences)
Read: DOJ Targets Illegal DEI Programs Under New Executive Order - National Law Review
By March 1, 2025, the Civil Rights Division and the Office of Legal Policy are to submit a report containing recommendations to “encourage the private sector to end illegal discrimination and preferences” related to DEI.
Notably, the memo does not prohibit educational, cultural, or historical observances that “celebrate diversity, recognize historical contributions, and promote awareness without engaging in exclusion or discrimination.” Examples of these types of observances include Black History Month and International Holocaust Remembrance Day.
This new effort from the DOJ will likely face legal scrutiny in the coming weeks, as federal courts have routinely upheld private employers’ First Amendment right to promote DEI.
February 6: Secretary Turner announced in a press conference that HUD would immediately halt any pending or future enforcement actions related to HUD’s 2016 Equal Access Rule.
Per the National Alliance to End Homelessness: “The Equal Access Rule itself has not been rescinded; that requires a formal regulatory process.”
Read: Federal Updates & Continuing Advocacy - National Alliance to End Homelessness
February 7: President Trump issued a short memo directing “the heads of executive departments and agencies (agencies) to review all funding that agencies provide to NGOs”
Read: Why We Filed a Lawsuit Against the Administration | National Council of Nonprofits
February 10: A federal judge said on Monday that the White House had defied his order to release billions of dollars in federal grants, marking the first time a judge has expressly declared that the Trump administration is disobeying a judicial mandate.
February 11: A federal judge has blocked efforts to cut the NIH’s “indirect costs” in the funding it provides to research grants by 50%.
Read: NIH Budget Cuts - TIME
February 12: Kennedy Center President Deborah Rutter Steps Down as Trump Is Officially Elected Chair | Playbill
Read: Kennedy Center Responds to Trump's Intentions to Take Control | Playbill
Actions to take:
Guidance and legal orders are changing day to day. Always refer to granting agencies for updated guidelines.
Engage with your local lawmakers to express your concerns and opinions.
5calls.org is a tool that directs you to the right politicians and allows you to focus your efforts on the issues most pressing to you and your organization.
Be a storyteller to demonstrate policy changes' impact and real-world effects.
Participate in nonprofit coalitions actively advocating on behalf of the sector, including Purpose Possible’s newly formed Executive Exchange. Our first meetup was held on 2/12/25 and we will share key takeaways and next steps in a future blog post shortly.
This may be a good time to run through some cash flow forecasts for various scenarios. Here is a tool from the Nonprofit Finance Fund: Nonprofit Budgeting Scenario Planning Tool.
Tools:
Bookmark: National Council of Nonprofits: “Executive Orders Affecting Charitable Nonprofits” - a chart of the most pertinent executive orders, expected impacts, and related actions that will be updated regularly.
Resources:
Georgia Center for Nonprofits US Policy Changes Resource Hub
Minnesota Council of Nonprofits Executive Orders affecting nonprofits
Reading
Navigating the Federal Funding Freeze: What Nonprofits Need to Know (Part 2)
On Monday, February 3rd, the U.S. District Court for the District of Columbia granted a temporary restraining order of the OMB’s freeze on federal grant disbursements that has put essential services across the nation in jeopardy in response to a suit filed by Democracy Forward on behalf of the National Council of Nonprofits, the American Public Health Association, Main Street Alliance, and SAGE.
February 5, 2025 - This content will be updated as developments unfold.
“On January 29, the U.S. Office of Management and Budget (OMB) rescinded M-25-13, which it had issued two days earlier, and which required federal agencies to "temporarily pause all activities related to obligation or disbursement of all Federal financial assistance" and "complete a comprehensive analysis of all of their Federal financial assistance programs to identify programs, projects, and activities that may be implicated by any of the President's executive orders."
Days after it was issued on January 27, one federal judge administratively stayed a portion of the memo before the OMB rescinded it altogether. A White House press secretary subsequently explained that the "freeze" was, in fact, still in place, and another judge indicated he intends to issue an injunction soon. While much remains unclear, there are basic parameters and next steps every FFA recipient should consider.”
-Venable LLP. (2025, January). The OMB Issued a Memo Freezing Federal Financial Assistance. And Then Rescinded the Memo, But Not the Freeze. Confused? Read On.
Most Recent Updates:
On Monday, February 3rd, the U.S. District Court for the District of Columbia granted a temporary restraining order of the OMB’s freeze on federal grant disbursements that has put essential services across the nation in jeopardy in response to a suit filed by Democracy Forward on behalf of the National Council of Nonprofits, the American Public Health Association, Main Street Alliance, and SAGE.
Full press release from National Council of Nonprofits
What does this mean?
National Council of Nonprofits President, Diane Yentel explained on LinkedIn:
The judge presiding over our case - National Council of Nonprofits et al vs. Office of Management and Budget - GRANTED another Temporary Restraining Order against the admin’s ability to halt federal grants and loans!!
The DOJ’s motion to dismiss was DENIED.
OMB is ENJOINED from implementing, giving effect to, or reinstating under a different name the directive to halt federal spending broadly.
OMB must provide notice to all federal agencies, and instruct all such agencies to release any funding that was paused under the directive. OMB has to update the court on Feb 7th on how they have notified the agencies.
Much more to come but make no mistake - this is a significant setback to the administration’s plans to halt federal funding.
Actions to take:
In response to the Federal Funding Freeze announcement on Tuesday, January 27, Purpose Possible issued a statement to its clients titled "Navigating the Federal Funding Freeze: What Nonprofits Need to Know.” Despite the court’s ruling on Feb. 3rd, PP is strongly encouraging all of our clients to take steps to ensure the resilience and solvency of their organizations with or without government funding. No matter what happens with government funding, your organization can only be made stronger by diversifying its funding streams and deepening relationships with donors and private funders.
Tools:
To help start the conversation and navigate the complexities of scenario planning we have designed a flowchart to aid in the decision-making process.
In Community:
Exec Exchange: A Nonprofit Leadership Town Hall
Join Purpose Possible and other nonprofit executive leaders for a candid discussion of recent threats to government funding, recommendations for how to move forward, and a collective call to action.
Date: Wednesday, February 12, 2025
Time: 9:00am - 11:00am EST
Location: East Atlanta Kids Club
at Brownwood Recreation Center
Venue graciously provided by East Atlanta Kids Club
Breakfast will be provided
Resources:
Georgia Center for Nonprofits, Executive Orders & Nonprofit Impact Webinar
(At the time of this article, registration was closed, but we encourage folks to check back as they may expand capacity)
Join us to hear from a panel of experts specializing in nonprofit law and crisis communications. Bring your leaders and your questions, and we’ll provide clarity around the legal developments to date as well as action steps for preparation and advocacy.
Date: Thursday, February 6, 2025
Time: 3:00 - 4:30 pm EST
National Council of Nonprofits presents, Executive Actions and Their Impacts on Charitable Nonprofits Webinar - RSVP, OR Register to Receive the Recording
The last couple weeks have been a whirlwind for many nonprofits, from the more than 100 Executive Orders (EOs) issued by President Trump to the confusion about the funding freeze ordered in a memo from the Office of Management and Budget (OMB). While a judge granted an Administrative Stay in the case filed by the National Council of Nonprofits and others, and OMB rescinded the memo, the EOs are still in effect, and charitable nonprofits with federal grants are still feeling the impact of these decisions. Learn more about EOs, the ones most directly or indirectly impacting charitable nonprofits, and the latest on the legal challenges.Because we expect overwhelming interest for this webinar, please only click the link to register for the live event if you plan to view it live. If you don't anticipate being able to join live, please register to receive the recording so we can keep as many live lines available as possible.
Date: Friday, February 7, 2025
Time: 3:00-4:00pm EST
Kilpatrick Townsend presents, The Changing Landscape of Federal Funding in the Trump Administration - RSVP
Join Kilpatrick Townsend to discuss the new administration's approach to federal funding and its implications for grant and aid funding and policy changes. We will explore topics including, but not limited to, the rescinded federal funding freeze, a shift in DOJ enforcement actions, policy changes affecting grant administration, and what we might see moving forward.
Date: Wednesday, February 12, 2025
Time: 1:00 p.m. to 2:00 p.m. EST
Reading
The American Bar Association: What is an Executive Order?
National Council of Nonprofits: “Executive Orders Affecting Charitable Nonprofits” - a chart of the most pertinent executive orders, expected impacts, and related actions that will be updated regularly.
Navigating the Federal Funding Freeze: What Nonprofits Need to Know (Part 1)
The recent directive from the White House to temporarily freeze federal grants and loans has created uncertainty and concern for many organizations that rely on federal funding to sustain vital programs. This is what we know and what we recommend.
January 29, 2025 - This content will be updated as developments unfold.
The recent directive from the White House to temporarily freeze federal grants and loans has created uncertainty and concern for many organizations that rely on federal funding to sustain vital programs. At Purpose Possible, we understand these concerns and are actively working to gather and share information in an effort to provide clarity, guidance, and support as we navigate this evolving situation together.
What’s Happening?
On Tuesday, January 27, 2025 the Trump White House issued a temporary freeze on federal grants and loans as part of a broader policy review (Roll Call, January 27, 2025). This pause delays funding disbursements and approvals, creating challenges for nonprofits that depend on these resources.
While the full implications of this directive remain unclear, it's important to note that the Impoundment Control Act of 1974 limits the executive branch's power to withhold funds without congressional approval. This means that while delays are possible, permanent cuts to already-appropriated funding are unlikely without further legislative action.
How This Affects Funding
Current Grants and Loans
Late Tuesday afternoon, a federal judge in the District of Columbia temporarily blocked the order in response to a lawsuit filed by Democracy Forward, a liberal organization that argued that the directive violated the First Amendment and a law governing how executive orders are to be rolled out. The judge, Loren AliKhan, said she would issue a more permanent decision on February 3.
On Wednesday, January 28, 2025, the White House rescinded the Office of Management & Budget Memo, M-25-13. White House Press Secretary, Karoline Leavitt did say that some funding freezes would remain in effect. We are awaiting further clarification but can share that clients in the housing sector have reported the reopening of grant reimbursement portals on Wednesday afternoon.
Whether the funding freeze announced this week fully goes into effect or not, it is clear that government funding may not be a reliable source of funding going forward. Read on for recommendations for how to manage these changes in the weeks ahead.
Future Grants and Loans
The announcement or awarding of new funding opportunities may be postponed, which could delay programs in the application or approval stages.
Steps You Can Take Now
Stay Informed
Organizations have been advised to continue submitting budget claims, funding requests, and reimbursements.
Reach out to the program officer at the federal agency from whom you receive funding to seek clarity on the next steps. Stay in contact with this person but also know that they may also be seeking clarity and answers. Be diligent, but be patient.
Familiarize yourself with specific contract terms and conditions related to existing awards, especially regarding termination requirements. Your terms and conditions are part of the contractual agreement, and ensuring your continued compliance with your grant is critical.
Assess Financial Impact
Build a daily cash flow model and run scenarios for paused federal payments (for the next two weeks, next month, three months, etc.) to determine when your organization will be challenged to meet expense obligations.
If you anticipate that this funding halt will impact your ability to operate, contact your bank about immediate cash flow options that may be available.
If your organization has a board-restricted reserve and/or endowment, convene a discussion regarding shifting policy to access these funds, if necessary.
Develop Contingency Plans
Create scenario plans to identify adjustments you could make to programs, staffing, or expenses if federal funding is delayed or reduced.
Draft messaging to donors and stakeholders about the potential impact of the freeze and the need for support.
Develop strategies to diversify funding sources for both immediate and long-term stability.
Advocate for Clarity
Engage with congressional representatives and advocacy groups to emphasize the importance of uninterrupted federal funding for your programs.
Document how the freeze affects your operations and collaborate with peers to amplify concerns.
Moving Forward
While this directive has created uncertainty, Purpose Possible remains committed to helping our communities navigate the challenges ahead. We will continue to monitor developments, provide updates, and offer resources for support during this time.
If you have questions or need assistance, please don’t hesitate to reach out. Together, we can weather this challenge and continue our vital, mission-driven work.
Ways Purpose Possible Can Help:
● Strategize on non-government funding sources to assist with immediate cash flow support and long-term financial stability.
● Understand grant terms and agreements.
● Support in drafting messaging to your individual donors or community to convey the impact of this freeze on your mission and how they can offer their support.
● Support in reviewing your contingency plans.
Here are a few articles and resources:
Other resources:
FEARLESS FUND: What happened & what you need to know
The lawsuit against the Fearless Fund sparked widespread attention, raising questions for nonprofit and philanthropic organizations. Central to the case is whether race-based initiatives, aimed at supporting underfunded groups and addressing systemic inequalities, serve the public interest or violate anti-discrimination laws.
The lawsuit against the Fearless Fund has sparked widespread attention, raising critical questions for nonprofit and philanthropic organizations. Central to the case is whether race-based initiatives, aimed at supporting underfunded groups and addressing systemic inequalities, serve the public interest or violate anti-discrimination laws. Fearless Fund was established to address the gap that exists in venture capital funding for women of color-led businesses. The case has caused a shift in how organizations can seek or provide funding for programs targeting specific racial groups.
Courts are currently debating what is in the greater “public interest”—race-neutral initiatives only or actively trying to remediate systemic inequality with race-based initiatives.
Below are a few key insights from the case and ruling.
Here’s what happened:
On August 2, 2023, the American Alliance for Equal Rights (AAER) filed a complaint on behalf of three of its members against Fearless Fund and related entities.
The lawsuit alleged that a grant program run by Fearless Foundation violates 42 U.S.C. Section 1981, a federal statute enacted as part of the Civil Rights Act of 1866 that prohibits discrimination on the basis of race in the making or enforcement of contracts.
September 26, 2023: A U.S. District Judge denied AAER's request to halt the grant awards process, saying that the program qualifies as charitable giving, a form of protected speech under the First Amendment.
September 30, 2023: A three-person panel on the U.S. Court of Appeals for the 11th Circuit blocked the grant program, saying it was “racially exclusionary” and “substantially likely” to violate a federal law prohibiting racial discrimination in contracting.
Between December 6, 2023, and June 3, 2024, several legal actions were taken. The Fearless Fund sought to reinstate the program by filing a brief with the U.S. Court of Appeals and arguments were presented before a three-judge appeals panel in Miami. Ultimately, the 11th Circuit upheld the injunction in the case.
September 11, 2024: The parties settled the case, with Fearless Foundation agreeing to close the grant program permanently.y.
Here’s what you need to know:
The key word is CONTRACT. You can call something a grant, but if you are requiring any specific activities/requirements in exchange for the money (agreements, accepting the “rules” of the program etc), it’s more likely to be considered a contract, which courts are more likely to find discriminatory.
Specifying that "only applicants of a specific race can apply" in eligibility criteria is considered discrimination and poses a legal liability.
Unrestricted and "trust-based" philanthropy, which operates without formal grant agreements or explicit rules, is less susceptible to litigation.
Qualitative descriptions of overcoming race and discussing unique identity positions seem safe to include as application questions or vetting strategies, but race-based quotas and quantitative benchmarks for admissions or giving are liabilities.
Data to talk about racial injustice to justify any racial focus of a service provided is still okay to use.
Instead of using race as an eligibility criterion, it’s recommended that the application include a qualitative question about how applicants are advancing the organization/funder's racial equity goals.
For organizations that serve or provide services to a specific racial group: that activity is considered an expressive/first amendment right.
It has been recommended that organizations review mission statements and legal documents to ensure that their activities are described in “expressive” terms.
It is recommended that organizations review their insurance policies to ensure that they cover anti-discrimination litigation and that any stated racial focus does not render their policies void.
Purpose Possible is not a legal entity, and the information provided here is for informational purposes only. It should not be considered legal advice. Please consult with a legal professional for specific legal guidance.
Here are some headlines about the Fearless Fund Decision:
What the Fearless Fund Settlement Means for Philanthropic Freedom
(Chronicle of Philanthropy)
What’s Next for Philanthropy After the Fearless Fund Settlement?
(Inside Philanthropy)
Nonprofits, Legal Experts React to the Fearless Fund Decision to Shutter Grant Program to Black Entrepreneurs (Chronicle of Philanthropy)