State officials and public housing representatives expressed relief Wednesday after the Trump administration rescinded a controversial memo that sparked widespread confusion on federal grants.
But the debate over a freeze on federal funding is far from over as the Trump White House vows to continue targeting what it says is government waste.
Monday night's memo temporarily freezing grants spawned nationwide confusion among state agencies that rely on federal funding for health, housing and other programs. Maine's Medicaid program, for instance, temporarily lost access to federal systems that provide funding, as did programs that offer housing and energy assistance to low-income Mainers.
A federal judge blocked the funding freeze hours before it was slated to take effect on Tuesday in response to a lawsuit. But on Wednesday, the Office of Management and Budget sent out a second advisory saying the initial memo had been rescinded.
Republican Sen. Susan Collins, who leads the powerful Senate Appropriations Committee, which divvies up the federal budget, said she was pleased that the Trump administration had rescinded a memo that imposed "sweeping pauses in federal programs."
"While it is not unusual for incoming administrations to review federal programs and policies, this memo was overreaching and created unnecessary confusion and consternation," Collins said in a statement.
While the Trump administration said Tuesday that Medicare and Medicaid would not be affected by the funding freeze, state Medicaid programs across the country were temporarily unable to access a federal portal that allows them to draw down federal funds.
Lindsay Hammes, spokesperson for the Maine Department of Health and Human Services, said access to the system was restored on Tuesday afternoon and there had been no impacts to MaineCare providers or outgoing payments.
Bath Housing Authority Executive Director Debora Keller, who also leads the Maine Association of Public Housing Authorities, also welcomed the news that the memo had been rescinded. Keller says it should mean no interruption of funding from the Department of Housing and Urban Development, or HUD.
"Maine public housing authorities expect that all funds from HUD will flow as normal for February," Keller said. "This is great news as we can pay our landlords and our tenants' housing is stable. We do continue to monitor some of the uncertainties and review the executive orders to understand the impact."
But uncertainty remains high in Maine and across the country.
President Trump's press secretary said on social media that the administration only rescinded the memo, not the executive orders that aim to cut off spending on renewable energy, foreign aid, diversity and other programs.
"The President's EO's on federal funding remain in full force and effect, and will be rigorously implemented," press secretary Karoline Leavitt wrote on X.
Those efforts to curtail funding are already being challenged in court, however. In addition to the lawsuit that prompted the federal judge's intervention on Tuesday, Democratic attorneys general from roughly two dozen states — including Maine Attorney General Aaron Frey — filed suit against the Trump administration over the funding freeze memo.
