The federal funding freeze sparked anxiety in Wisconsin. Some groups are still on edge.

Days after a White House announcement that a wide range of federal funds would be frozen across the country, Wisconsin nonprofits and agencies that rely on those dollars say they still don’t know where things stand.

With conflicting information coming out of Washington and federal courts getting involved, Wisconsin nonprofits spent days in the dark about whether they’ll be able to pay employees and vendors, or even keep their doors open.

An initial memo pausing all funding was rescinded, but underlying executive orders from President Donald Trump ending funding for certain types of programs are still in effect — with little clarity for individual programs awaiting routine payments or seeking to stay in compliance with rapidly changing federal guidelines.

And that could have broad ripple effects across communities, said Philip Rocco, a political scientist and federal policy expert at Marquette University.

“It’s actually kind of impossible to estimate the daily impact of federal grants on the lives of the average Wisconsinite,” he said.

Wisconsin’s budget is passed in Madison and determines how much money the state will spend over a two-year period. That budget uses billions of federal dollars. The current budget totals more than $100 billion, with $28 billion of that coming from the federal government, according to the nonpartisan Legislative Fiscal Bureau.

But that number doesn’t account for the billions of dollars disbursed to local communities and organizations in the form of direct grants and loans. Those are among the payments that were briefly paused earlier this week.

According to publicly available data, those grants cover a vast range of programs and projects in cities, towns and tribal lands in every corner of the state, going to parks, museums, hospitals and housing units.

Head Start, an early childhood program for low-income children, and Meals on Wheels, a food delivery service for homebound seniors, are nearly entirely covered by long-standing federal funds.

Federal funds go to heating assistance for low-income families, repairing railroad tracks and scientific research. They’ve supported community policing initiatives and drug rehabilitation services, hearing screenings for newborns, and retention bonuses for nurses working in veterans’ hospitals.

In 2024, federal grants helped pay for a boardwalk in the village of Windsor, a fire truck in the town of Hull, playground equipment in the village of Fall Creek and to repair pavement at Milwaukee’s international airport.  

“It’s often difficult to see the powerful role that the federal government plays in supporting a lot of government activities that are broadly popular and, in a way, taken for granted as a part and parcel of daily American life,” said Rocco.

After an initial memo explaining the funding pause sparked mass confusion Monday night — and a multistate lawsuit signed onto by Gov. Tony Evers — the White House said direct payments through programs like Social Security, Medicare, Medicaid and food stamps would not be affected. A White House press secretary also said funds for rental assistance, Head Start, Pell grants and small business and farm support would continue.

And on Wednesday, the White House rescinded the memo entirely.

But the status of Trump’s funding orders remains unclear, and aspects of it are locked in the courts. Trump has said his ultimate agenda is to do away with federal support for certain progressive priorities like diversity, equity and inclusion, or DEI programs, some climate change work and “funding nongovernmental organizations that undermine the national interest.”

Meanwhile, some Wisconsin organizations say they’re in the dark about how to move forward.

A week of ‘trepidation, anxiety’

Mike Rhea is the executive director for the Aging and Disability Resource Center of Central Wisconsin, which works in Marathon, Lincoln, Langlade and Wood counties. He said much of that organization’s work is federally funded, including a Meals on Wheels program that serves about 1,300 elderly and homebound people.

He said there’s been “trepidation” and “anxiety” over the last few days as his organization tried to figure out what the White House order meant for them.

“There was just a lot of unknown,” he said. “What’s the immediacy of this? Does this mean today’s operations? Like, I need to stop today’s operations in regards to this?”

A freeze on those funds would have a “pretty significant impact” on the work his group does, he said.

And like other organizations in Wisconsin, Rhea said he’s relied on media reports to keep him apprised of what’s going on.

“There really weren’t answers, really anywhere,” he said. “I’m still, quite honestly, trying to figure out what that means and what the impact truly is.”

Some organizations say they have access to rainy day funds or other ways of covering their bases if the federal funds dry up.

Pat Stein, the executive director of Bolton Refuge House, which serves domestic violence survivors in Eau Claire, said in an email that the “majority” of that group’s funds would be affected by a federal funding freeze, and the group would have to turn to the community for donations.

“Of course the rainy day fund would empty quickly,” she wrote. “Programs would have to be prioritized, which (are) all life-saving. Cuts in programming and staff would ultimately occur. An overall awful situation that affect so many others.” 

Head Start provides free child care to low-income families and serves about 15,000 Wisconsin students, employing about 4,500 staff across the state.

Jen Bailey, who runs a Head Start program in Dane County, and also serves on the board of the Wisconsin Head Start Association, said providers rely on federal reimbursements. While the White House said earlier this week that these payments would not be affected, Bailey said the online system for requesting reimbursements was briefly dark and remains glitchy.

“Good news is, some people are getting payments to go through, which is very happy. The bad news is, many programs still are not. And then it’s creating these cash flow issues,” she said. “It’s really the uncertainty of: we have no idea what’s happening with the system. We don’t know why the delays are occurring, which makes it then very hard to plan for programs around their cash flow needs.”

Her organization is large enough that they accessed an emergency line of credit to make payroll this month, she said. But other Head Starts around the state don’t have those kinds of resources. One location in Waukesha shut its doors amid the uncertainty. The director of that location did not respond to WPR’s interview request.

And there’s also no such backup for Shasta Westaby, who runs a small private child care business in Rice Lake. Her business receives federal incentives tied to her performance and training, and most of the families who attend her program also receive federal assistance to attend day care.

The White House has said the freeze would not apply to direct payments to families. But Westaby said she’s waiting to see whether that proves true. On Feb. 1, families either will or will not receive their subsidies.

“A freeze of federal funding would mean I don’t get paid,” she said. “I would be absolutely gutted. There’s no backup plan for us in child care. A lot of times you’re looking at not having a savings, because child care is just enough to pay the bills that you do have and operate the center or the program.”

She said she’s warned the families she serves that the future of her program is up in the air — but that, as a single mother, she might have to shutter and pick up other work.

“This is where my heart and soul is, and I can’t just shut down and leave families in the lurch,” she said. But “if we hit the first of the month and there’s no child care assistance, I have to put my best interests and my family’s best interest first and say my doors are closing.”

The status of the freeze remains unclear

The Trump administration’s initial order announcing the freeze came Monday evening and was set to go into effect on Tuesday at 5 p.m. Shortly before that deadline, a federal judge put the plan on hold.

On Wednesday, the White House rescinded the corresponding memo, but White House press secretary Karoline Leavitt announced on the social media platform X that rescinding the memo did not amount to rescinding the freeze as a whole.

The White House Office of Management and Budget has said it continues to review 2,600 federal programs to ensure they don’t “advance Marxist equity, transgenderism and Green New Deal social engineering policies.”

The White House also said organizations who are unsure if their programs violate those requirements should reach out to the OMB “to begin to unwind these objectionable policies without a pause in their payments.”

But several Wisconsin organizations told WPR they have received no communication from the federal agencies they typically interact with.

Meanwhile, a second federal judge has said he will consider taking additional steps to block the spending freeze, with or without the original memo, based on comments this week by the White House.

“While the piece of paper may not exist, there’s sufficient evidence that the defendants collectively are acting consistent with that directive,” U.S. District Judge John McConnell said Wednesday.