'Disastrous consequences': Gov. Evers asks Trump to delay federal freeze on grants and loans

MADISON, Wis. (CBS 58) -- Widespread confusion and panic. That's what many state and local officials felt Tuesday in wake of President Donald Trump's sweeping order to pause federal grants and loans. 

Earlier in the day, Gov. Tony Evers urged President Trump to reconsider his decision to freeze federal funding and threatened legal action because of the "disastrous consequences" it could have on state agencies and residents.

Minutes before the order went into effect, a federal judge temporarily blocked the pause on federal aid that provides a financial lifeline to schools, child care centers, and nonprofits. 

Wisconsin also filed a multi-state lawsuit that argues "jeopardizing federal funding for states will put Americans in danger by depriving law enforcement of much-needed resources."

The Trump administration announced an abrupt freeze on nearly all federal grants and loans Monday night, which left state and local officials scrambling. 

"With very few details and specifics available, virtually no time for ample review and consideration, and no direct communication to date, states are left to plan for the worst, and Wisconsinites and millions of Americans who are rightfully alarmed and concerned by this unprecedented decision are left scrambling," Evers wrote in a letter to Trump. 

Milwaukee Mayor Cavalier Johnson and Democratic Congresswoman Gwen Moore (D-Milwaukee) told reporters at a press conference in Milwaukee they worried a pause could hold up money earmarked for public safety and road construction. They also expressed concern nonprofit service providers could be left without payments they depend on.

"I've talked to people already who are shivering and quivering in their shoes because they do have patients and customers who need them," Moore said.

Republican Congressman Glenn Grothman (R-Fond du Lac) said a Q and A release from the White House plainly explained how the freeze would leave the vast majority of federal aid flowing on schedule.

"Things to specific people, things like Medicare payments, that sort of thing, not affected," Grothman said. "Things to groups that have been around a long time, like Head Start? Not affected."

Grothman noted the White House memo specifically stated the Trump administration would be targeting "DEI, the green new deal, and funding nongovernmental organizations that undermine the national interest."

"It affects you if you applied for a grant and are doing something that's clearly inappropriate," Grothman said. "Like providing aid to illegal immigrants or determining who the beneficiaries are of that grant based on racial background, sex background, that sort of thing."

However, the recipient of Head Start funding for Waukesha County said Tuesday night they currently cannot access that national payment system, and he's worried they won't be able to make payroll.

Johnson said he believed the Trump administration's explanation was far from straightforward. 

"I don't know what it means to be woke," he said. "I think it depends on the day and whatever folks who wanna use that term feel like when they get out of bed in the morning."

Johnson also would not rule out joining other cities in filing a separate lawsuit based on the impact a federal freeze would have on municipal governments across the country.

Both he and Moore said they were confident the courts would rule it's unconstitutional to rescind any grants that had already been approved by Congress and signed by former President Joe Biden.

"We're trying to get a lay of the land as it is," Johnson said about a possible lawsuit. "And try to use the power of the collective in order to push back on this."

Regardless of how this plays out in court, many are bracing for more uncertainty surrounding federal funded programs and how it could be at risk in the future. 

According to the nonpartisan Legislative Fiscal Bureau, Wisconsin is estimated to receive $28.2 billion in federal aid over the 2023-25 biennium.

Trump's order comes weeks before Evers is set to unveil his budget proposal on Feb. 18. It's why some members on the Legislature's Joint Finance Committee are worried it could disrupt the process. 

"Uncertainty makes it almost impossible for government or any agency to budget," said State Sen. Kelda Roys (D-Madison). "We have to think very carefully about making sure we're able to take care of people's basic needs if the federal government persists in trying to withhold these funds," 

Rep. Mark Born and Sen. Howard Marklein, the Republican co-chairs of the committee, said they're prepared to adjust to any policy changes directed by the federal government when crafting the 2025-2027 state budget. 

"We will continue to monitor any actions that may impact the Wisconsin budget," the co-chairs said in a statement. 

The state currently has a projected $4.5 billion surplus, but lawmakers could be more reserved about spending it in light of Trump's actions.