Tribes scramble to respond to Trump administration funding freeze

This story has been updated with the latest developments.

Dianna Hunt, Kevin Abourezk, Jourdan Bennett-Begaye and Stewart Huntington
ICT

Tribal leaders scrambled Tuesday to respond to the abrupt decision by the Trump administration to freeze federal grants and loans, a move that could impact more than $1 billion in federal funding in tribal communities for health care, education, climate projects, agriculture, law enforcement and other programs.

Although a federal judge in Washington, D.C., granted an injunction late Tuesday to halt the funding freeze just minutes it went into effect, tribal leaders were continuing to assess the potential impact to their programs.

The White House plan could affect trillions of dollars in funds nationwide, although Medicare and Social Security are excluded. The 2024 budget for Indian Affairs is $4.7 billion, including the Bureau of Indian Affairs, Bureau of Indian Education, the Bureau of Trust Funds Administration and the Office of the Assistant Secretary for Indian Affairs.

“It’s hard to read what the impact will be. But, the immediate concern is that our funding is at risk,” Aaron A. Payment, former first vice president of the National Congress of American Indians, said in a post on Facebook.

“Even if just temporary, Tribal Nations depend on the Federal Government fulfilling the treaty and trust obligations. We prepaid for every penny we get with nearly 2 billion acres of land,” he said. “Treaties do not expire when we change presidents so we expect the federal government to be good to their word and not interrupt our funding. Our funding should be fully funded, mandatory, and multiples of what it is today.”

The memo from the U.S. Office of Management and Budget ordering the funding freeze drew immediate legal action. A lawsuit filed by a group of Democratic attorneys general won the injunction from U.S. District Judge Loren L. AliKhan in Washington, D.C.  Another lawsuit was filed by a group of nonprofit and advocacy groups, including the National Council of Nonprofits, the American Public Health Association, Main Street Alliance and Sage.

The lawsuit filed by the nonprofits said the funding freeze would have “a devastating impact on hundreds of thousands of grant recipients who depend on the inflow of grant money (money already obligated and already awarded) to fulfill their missions, pay their employees, pay their rent — and, indeed, improve the day-to-day lives of the many people they work so hard to serve.”

The announcement sparked confusion and panic among tribal officials and other organizations that rely on Washington for funding, but the full impact of the freeze was yet to be determined.

“It’s going to have a bunch of impacts on the economic side,” said Robert Maxim, a researcher on Native nations for the Brookings Institution think tank in Washington, D.C. Maxim is Mashpee Wampanoag.

“We’re talking about frozen funding for everything from business development to economic support to education to some of the larger, really substantial federal investments that were made during the late Biden administration of things like infrastructure or green energy,” Maxim told ICT. “All of these things are really to the direction that I think a lot of tribal leaders have wanted to take for the future of their economies.”

The freeze will cut into funds that are at the heart of trust and treaty obligations, he said.

“There are a whole bunch of programs that are clearly designed with the trust and treaty obligation at the heart of it that are getting caught up here,” he said. “This is akin to the impact of something like a government shutdown where a whole bunch of funding just dries up overnight for who knows how long?”

Payment said the announcement was “catching tribes off guard,” although it’s normal to see a change of philosophy when a new president takes office.

“What we’re seeing is different than that,” he told ICT. “We’re seeing memos that are far-reaching and sweeping. Memos that carry a political ideology with them, like the anti-DEI, diversity, equity and inclusion.”

He continued, “One of the fears I have is a lot of people, even members of Congress, who make appropriations, don’t understand that the funding we receive is not DEI at all. Our funding is the treaty and trust obligation. It’s in exchange for the nearly 2 billion acres of land that we exchange for health, education and social welfare into perpetuity. We only get pennies on the dollar, so we’re way underfunded.”

Reaction to the announcement from Indigenous leaders was sharp but reflected the uncertainty spreading across Indian Country.

In a social media post Tuesday, the Denver Indian Center said it had suspended its federally funded programs, though it planned to remain open.

“Due to the order coming from the White House, all program activities funded by federal grants are on pause until further notice,” the center said. “This includes all activity associated with the Native Workforce program and Honoring Fatherhood Program at the Denver Indian Center. … We will keep the community updated as information is received.”

During an Oglala Sioux Tribal Council meeting on Tuesday morning, President Frank Star Comes Out expressed concern about the impact of a federal funding freeze on the tribe’s programs and encouraged the council to focus on ensuring tribal programs have funds to continue to operate.

“Right now everybody’s in a panic and I don’t think we should fall for that.” he said. “We need to wait, let it play out, in the meantime take action, take measures to make sure our programs are safe, our people are covered.”

Tribal Treasurer Cora White Horse told council members that she was confident that most tribal programs, including the tribe’s housing program, could draw down at least six months of funds.

“The most important thing is not to panic,” she said. “As long as our funds are drawn down and we have money to operate, it’s normal business to stop things to see where you are.”

Some tribal programs don’t have funds to draw down, however, she said, specifically those that receive federal funds dispersed through the state of South Dakota through reimbursement of expenses. She cited the example of an emergency youth shelter that receives federal funds through the state.

“I’m not sure exactly how that’s going to work,” she said.

Cherokee Nation officials said the officials were still evaluating the repercussions if the freeze were to go into effect.

“The Cherokee Nation is evaluating its programs for any potential impacts related to the President’s memorandum pausing federal grants and loans,” Cherokee Nation Chief of Staff Corey Bunch said in a statement.

“Many of our departments, including our health facilities and housing programs are generally forward funded and operating as normal, and we are continuing to closely follow any developments that may impact our Cherokee Nation citizens and services,” Bunch said.

Muscogee (Creek) Nation Principal Chief David Hill said his tribe was monitoring the federal funding freeze and working to protect tribal programs.

“Our team is actively communicating with all relevant federal partners and counterparts to better understand the administration’s process and to advocate for the best interests of Muscogee Nation citizens,” he said in a statement. “It is important to note that the OMB order recognizes a distinction between non statutory funding and other statutory obligations such as the federal trust responsibility to tribal nations.

“We remain committed to ensuring minimal disruptions to our programs and are confident in our ability to navigate this situation, just as we have risen to past challenges, including government shutdowns and the pandemic,” Hill said.

In Alaska, Shea Siegert, spokesperson for the Alaska Native Tribal Health Consortium, said the organization was examining the decision but was hopeful the courts might offer some clarity.

“What we know right now is that ANTHC employees will continue showing up and striving to achieve our vision that Alaska Native people are the healthiest people in the world,” she said in a statement. “While our Tribal leaders fight to ensure the federal trust responsibilities to our Tribal nations are met, our sole focus is on delivering the highest echelon of care to the people we serve.”

In Montana, the state House Democratic minority leader, Katie Sullivan, called the administration’s order “nothing short of outrageous.”

“Montana businesses and workers need stability to thrive, and instead we are getting chaos,” Sullivan said in a statement. “This will likely have immediate, negative impacts on small business owners, construction workers, cancer patients, and many more.”

Montana state Sen. Jonathan Windy Boy, Chippewa Cree, said tribal governments as well as tribal colleges and universities would be directly affected.

“Huge impact on tribes with colleges, especially grants and payroll,” Windy Boy said. “Tribal governments will be affected, because of BIA and [Indian Health Service] federal funding. It will be hitting everything.”

Windy Boy also brought up a concern for rural communities that may not have reliable access to bandwidth and may not be aware of the order and its potential impacts.

“Montana businesses and workers need stability to thrive, and instead we are getting chaos,” Sullivan said in a statement. “This will likely have immediate, negative impacts on small business owners, construction workers, cancer patients, and many more.”

Members of Congress also pushed back against the plan.

“The Trump Administration’s funding freeze is not only reckless and flagrantly illegal — it is a direct assault on Tribal communities, rural America, and vulnerable populations across the country,” U.S. Rep. Chellie Pingree, a Democrat from Maine, said in a statement.

“From halting Indian Health Service funds that provide lifesaving health care to Native Americans and Alaska Natives, to blocking EPA programs that protect low-income and rural communities from pollution, this directive threatens public health and safety from Maine to Alaska.”

Lacey Horn, a former Cherokee Nation treasurer and owner of Native Advisory, a tribal financial consulting firm, advised tribal leaders Tuesday to focus on drawing down all funds to which they have access. She also said tribal finance officers should work to find other sources of funding to replace any potential lost federal funds.

“I think it’s very similar to how we might approach a government shutdown if it were to happen with zero advance notice,” she said in a video statement. She directed leaders to a document created by Native Advisory that offers advice to tribes on how to weather a government shutdown.

“Knowing that there are others in this with you will be very helpful,” she said.

The total dollar figure that could be impacted is not clear. A December report from the Government Accountability Office found that Congress had approved $32.6 billion in funding and other assistance for tribal communities in 2024, but that only a fraction was actually reaching those communities.

Kaiden Forman-Webster and Kolby KickingWoman contributed to this report for ICT from Montana, and Shondiin Mayo contributed from Phoenix. This article contains material from The Associated Press.

This story was produced with help from funding from the W.K. Kellogg Foundation.

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