Colorado leaders accuse Trump, Vought of unlawfully withholding federal funds from states

Two weeks after President Donald Trump’s administration launched a chaotic attempt to freeze federal spending, more than half a billion dollars in congressionally authorized funds are still being unlawfully withheld from public and private entities across Colorado, state leaders said in a letter Monday.

In apparent defiance of federal court injunctions blocking the freeze from going into effect, more than $570 million in obligated funding remains “inaccessible for Colorado grantees,” Gov. Jared Polis and U.S. Sens. Michael Bennet and John Hickenlooper wrote to Office of Management and Budget Director Russell Vought.

“Companies, local governments, state agencies and nonprofit organizations entitled to funds from a range of programs continue to report that they cannot access their federal grant portals or receive reimbursements due to them under their federal grant contracts despite both the court order and the promises from the agencies,” the Democratic officials said.

The spending freeze is just one part of the second Trump administration’s unprecedented efforts to expand executive power in its early weeks in office. Along with attempted shutdowns of congressionally established federal agencies like the U.S. Agency for International Development and the Consumer Financial Protection Bureau, the move runs contrary to long-settled separation-of-powers principles in the U.S. Constitution, and have raised legal alarm bells across the executive branch.

Vought, who was confirmed by the Republican-controlled U.S. Senate last week, is an influential proponent of radical legal theories that assert sweeping presidential powers to “impound” federal spending and order mass firings of civil servants. He was a principal architect of Project 2025, a wide-ranging and controversial set of policy proposals for the incoming Trump administration led by the conservative Heritage Foundation.

The OMB’s Jan. 28 funding freeze was quickly put on hold by the courts, including through a temporary restraining order issued in a case brought by Colorado Attorney General Phil Weiser and his counterparts in 21 other states. But Weiser said Friday that the administration was “not complying” with the initial order.

“Neither the Constitution nor federal spending statutes allow the president authority to take such action,” Weiser’s office said in a press release.

Colorado and the other plaintiff states filed a new motion asking the court to go further in enforcing its previous order. A U.S. District Court judge granted the states’ motion for enforcement Monday, ordering the administration to “immediately restore frozen funding” while the litigation is pending.

“The broad categorical and sweeping freeze of federal funds is, as the Court found, likely unconstitutional and has caused and continues to cause irreparable harm to a vast portion of this country,” wrote Judge John J. McConnell.

Polis, Bennet and Hickenlooper wrote to Vought that Colorado grantees seeking to access their funds are encountering a variety of problems, including grants labeled “suspended” or missing entirely from their systems. Billions of dollars in federal assistance authorized by two landmark laws enacted under former President Joe Biden, the Inflation Reduction Act and the Infrastructure Investment and Jobs Act, top the list of funds that remain frozen.

Intermittent issues accessing funds have also been reported by Colorado early childhood education programs that receive Head Start grants, while Hickenlooper’s office has cited impacts to rural hospitals and emergency services across the state.

“The consequences of this continued uncertainty are severe and could have a devastating effect on the programs and people this funding supports,” they wrote. “Companies are considering staff furloughs. Employers in rural communities are rescinding job offers. Long-standing Colorado businesses, some with over 40 years of operation, now struggle to pay contractors working on facility expansions.”

The officials asked Vought to answer a series of questions, including to “describe the steps you have taken or will take to resume the disbursement of funds in compliance with court orders,” by Feb. 14.

Editor’s note: This story first appeared on Colorado Newsline, which is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Colorado Newsline maintains editorial independence. Contact Editor Quentin Young for questions: info@coloradonewsline.com.