Federal student loans, Pell Grants not tied up in funding pause, but will be reviewed
01/28/25
WASHINGTON – Students across the country expressed relief Tuesday after the U.S. Department of Education confirmed direct student loans and Pell Grants won’t be stopped amid a broad federal funding pause ordered by President Donald Trump.
The White House Office of Management and Budget
issued a memo Monday directing federal agencies to “temporarily pause all activities related to obligation or disbursement of all federal financial assistance,” Reuters reported.
The sweeping announcement triggered widespread confusion and panic among government bureaucrats and everyday Americans scrambling to figure out the implications before a 5 p.m. deadline Tuesday when federal agencies would freeze certain funds.
Madison Biedermann, the deputy assistant secretary for communication strategy in the Education Department, said in a statement to USA TODAY Tuesday that the temporary pause will not impact “assistance received directly by individuals,” including federal direct student loans and Pell Grants, which are government subsidies that help low-income students pay for college.
Those programs are still included in a massive list of government funding streams the Trump administration is reviewing to ensure they comply with his suite of recent executive orders, according to a set of instructions provided to agencies.
Federal agency officials have until Feb. 7 to respond to a list of questions about whether certain programs support or provide services, “either directly or indirectly, to removable illegal aliens.” The instructions also ask whether the programs “promote gender ideology,” “promote or support" abortion "in any way,” or “provide funding that is implicated by the directive to end discriminatory programs, including illegal DEI and ‘diversity, equity, inclusion, and accessibility’ (DEIA) mandates.”
Colleges and universities, which have found themselves disproportionately in Trump’s crosshairs in his first two weeks in office, were bewildered by the decision.
“This is unprecedented. It is harmful,” said Jon Fansmith, the assistant vice president of government relations at the American Council on Education, a higher education advocacy group in Washington. “We are still figuring out just how bad it will be.”
K-12 federal funds, such as Title I money which supports low-income school districts, were also on the list of programs for review, according to the agency instructions. The Department of Education said Tuesday that Title I grants and legally mandated funding for special education are not on hold.
"This is not a blanket pause on federal assistance and grant programs from the Trump administration," said Karoline Leavitt, the White House press secretary, during a briefing Tuesday afternoon. "The reason for this is to ensure that every penny that is going out the door is not conflicting with the executive orders and actions that this president has taken."
Teachers unions castigated the move. Becky Pringle, the head of the National Education Association, called the pause “unprecedented, illegal, and reckless.” “What is Donald Trump thinking?” said Randi Weingarten, the head of the American Federation of Teachers.
The Education Department would not provide a complete list of federal funding streams to be halted but said the agency is working with the budget office to identify other programs not covered by the memo
