Tracking Federal Actions Impacting the Nonprofit Sector

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Tracking Federal Actions Impacting the Nonprofit Sector

Latest Updates (As of December 22, 2025, 11:00 AM ET)

This article tracks ongoing developments of the federal actions impacting the nonprofit sector. We will update the article at least once a week, and in case of significant developments, we will provide updates as quickly as possible.

  • Understanding Executive Orders and Their Impact on Funding 01.20.25
  • Foreign Aid: 01.26.25
  • A Nationwide Funding Freeze: 01.27.25
  • Legal Challenges and Court Interventions: 01.28.25
  • Reversal of the Funding Freeze Memo: 01.29.25
  • Court Rulings: 01.31.25 and 02.03.25
  • OMB Instructions for Federal Financial Assistance: 01.28.25
  • Presidential Memorandum on NGO Funding: 02.06.25
  • Ongoing Challenges for Nonprofits: updated as of 02.13.25
  • Holding Pattern; Preliminary Injunction on Funding Freeze 02.20.25
  • USAID and Foreign Aid; Preliminary Injunction Issued 02.25.25
  • Foreign Aid 02.26.25
  • Supreme Court Decision 03.05.25
  • Court Decision 03.11.25
  • USAID 03.19.25
  • Responding to the Freeze 03.26.25
  • Courts Continue to Weigh In 04.01.25
  • Court Rulings 04.08.25
  • National Preliminary Injunction 04.16.25
  • President’s First 100 Days 04.29.25
  • Additional Tracking Resources for Discretionary Grants 05.05.25
  • Take Action on the Latest Draft Tax Bill 05.13.25
  • Federal Grant Opportunities Being Released 05.20.25
  • Protect and Strengthen Nonprofit Organizations in the Tax Package 05.28.25
  • Recommended Discretionary Grant Funding for Fiscal Year 2026 06.04.25
  • Setting the Record Straight 06.10.25
  • Ruling on the National Institutes of Health Funding 06.18.25
  • Passage of H.R. 1, AKA “One Big Beautiful Bill Act” 07.08.25
  • Johnson Amendment 07.17.25
  • Rescissions Act 07.31.25
  • Executive Order: Improving Oversight of Federal Grantmaking 08.11.25
  • Navigating EO 14332: Improving Oversight of Federal Grantmaking 08.26.25
  • Executive Order and Funding News 09.18.25
  • Risk of Government Shutdown 09.23.25
  • Government Shutdown 10.02.25
  • Nonprofits Under Significant Strain 11.07.25
  • Shutdown Ends 11.14.25
  • Impact on Nonprofits; New Survey 12.08.25

Latest Updates (As of December 22, 11 AM ET)

Congressional Philanthropy Caucus

The Congressional Philanthropy Caucus has officially relaunched in the U.S. House of Representatives. The Caucus reestablishes a dedicated venue for philanthropy and policymakers to work together on charitable giving, community investment, and the long-term health of the philanthropic ecosystem. The caucus has support of many in the nonprofit sector, from the Grant Professionals Association, United Philanthropy Forum, National Council of Nonprofits, The Nonprofit Alliance, and more. 

The Caucus needs our support and engagement! United Philanthropy Forum will be developing and sharing tools to help members and partners engage with the Caucus. This will include guidance on inviting House members to join and participate in future briefings and activities.

Foundations on the Hill 2026 will serve as a key moment to grow Caucus membership and demonstrate the sector’s collective commitment to constructive, bipartisan engagement with Congress.

By working together to strengthen the Congressional Philanthropy Caucus, the sector can help ensure that philanthropy’s expertise and community connections are reflected in federal policy conversations that shape the environment for charitable work.

Your advocacy is critical to strengthening our collective voice and building momentum for this important work. 

Latest Updates (As of December 8, 11:00 AM ET)

Federal Government Impacts on Nonprofits

As the federal government continues recovering from the longest shutdown in U.S. history, nonprofit organizations remain on the front lines of community impact. Below are important updates affecting the sector, along with insights into what they may mean for your organization in the coming months.

The Independent Sector’s “Health of the U.S. Nonprofit Sector 2025” report paints a sobering picture of the sector’s stability. This is important to note as nonprofits contribute ~5% of U.S. GDP (~$1.5 trillion) and are one of the country’s largest private employers.

However, nonprofits are experiencing heightened financial fragility, including:

  • Disruptions or delays in federal grants and contracts
  • Increased operating costs
  • Burnout and staffing shortages
  • Rising demand for services amid economic instability

These findings closely mirror the recent Center for Effective Philanthropy report showing 61% of nonprofits feel at “moderate to significant risk” of being able to continue operating.

The sector’s challenges are no longer temporary shutdown-related problems but reflect long-term pressures that require both policy and philanthropic responses.

2025 State of Grantseeking™ Government Update Report 

GrantStation’s original State of Grantseeking™ Survey, conducted in March 2025, captured grantseeking activity in 2024. Since that time, the government funding landscape has changed, and GrantStation conducted a follow-up survey to document those changes and provide a framework for nonprofit leaders to understand shifts in available funding opportunities. The 2025 State of Grantseeking™ Government Update Report provides an in-depth analysis of the current grantseeking landscape, based on responses from 1,056 organizations actively pursuing grant funding between January and July 2025.

A Path to Funding Resilience: A New Year, A Stronger Foundation

After a challenging 2025, nonprofit organizations are facing more pressure than ever. Reimagine and reinvigorate your efforts through this six-part TargetED series designed to broaden your revenue streams and build stability from the inside out.

This series, led by Alice Ruhnke of GrantStation and Sarah Barton of Nonprofit411, will help you build a balanced portfolio that protects your mission, your team, and your community, no matter what the external landscape looks like. You’ll learn how to reset, realign, and build a stronger financial foundation, one grounded in clarity, diversification, and values-aligned strategy.

Each session includes practical guidance, tools, templates, and examples you can use to carve your unique path in 2026.

All sessions are 45-minutes long and begin at 2pm ET.

By the end of the series, you will have:

  • a clear understanding of your current funding landscape;
  • a focused set of priorities for strengthening your revenue mix;
  • strategies for growing individual, foundation, government, corporate, and earned income streams;
  • tools you can customize and put into action immediately; and,
  • a pathway toward greater predictability, resilience, and long-term sustainability

Now is the moment to pause, reassess, and chart a steady course forward so you can create a funding foundation that supports your mission in every season.

Latest Updates (As of November 14, 11:00 AM ET)

Shutdown Ends

The longest government shutdown in U.S. history came to an end November 12, 2025 after the House approved the Senate-passed funding package, and the President signed the bill into law. Here are some things to watch as the government wheels start to spin once again. 

  • Federal Workers: The bill that Congress passed to end the shutdown guarantees back pay to federal workers who worked without pay. It also reverses several agencies’ attempted staffing reductions during the shutdown. According to the Bipartisan Policy Center,  approximately 670,000 federal workers were furloughed during the shutdown and roughly 730,000 federal employees worked without pay.
  • Supplemental Nutrition Assistance Program (SNAP): The bill funds SNAP through September 2026. Reopening the government means restarting SNAP, but it’s not clear how quickly full payments will resume, since that varies by state.
  • Air Travel: Airlines have warned that flight disruptions are likely to continue once the government reopens. Airlines had to adjust their schedules to reduce flights, and those changes can take time to reverse.

Latest Updates (As of November 7, 11:00 AM ET)

Nonprofits Under Significant Strain

A new report from the Center for Effective Philanthropy reveals a nonprofit sector under significant strain and examines philanthropic responses so far. Overall, 61% of nonprofits say that the current context poses moderate to significant risk for them to continue to operate. The report (“Mounting Pressure”) outlines the specific impacts on the sector. 

SNAP Benefits Still in Flux

The Supplemental Nutrition Assistance Program (SNAP) serves about 42 million Americans. Because of the prolonged federal government shutdown (no new appropriations), the United States Department of Agriculture (USDA) announced that it lacked the funds to pay full benefits for November, and at one point said there would be no SNAP payments on November 1, 2025.

On October 28, 2025, a coalition of states sued USDA in the U.S. District Court for the District of Massachusetts over USDA’s plan to suspend SNAP benefits starting November 1, 2025, because of the shutdown. On October 31, Judge Indira Talwani found the USDA’s interpretation of the relevant statute (that it cannot tap contingency funds without an appropriation) to be erroneous, and ordered the USDA to decide by Monday, November 3, 2025, whether it will at least pay reduced SNAP benefits for November using its contingency funds or other available funds.

On October 31, 2025, U.S. District Judge John J. McConnell Jr.  ordered USDA to submit a plan by November 3, 2025, to use contingency funds to provide at least partial SNAP benefit payments for November. The written order allowed two options: (1) make full payment by November 4 using Section 32 funds or other resources; or (2) if not full payment, make partial payments expeditiously with no later than November 5. The USDA appealed this decision. 

Many questions still remain: 

  • How quickly payments will arrive?
  • Will full benefit levels be restored?
  • How long can contingency funds be stretched?
  • What happens to new applicants?

Latest Updates (As of October 2, 2025, 11:00 AM ET)

Government Shutdown

The federal government shut down at midnight on September 30, 2025 after Congress and the White House failed to reach a bipartisan agreement on a continuing resolution to keep the government open and funded. The shutdown will impact the nonprofit sector. Below are some resources to help you navigate. 

Advocacy Still Matters

The Leadership Conference on Civil and Human Rights, joined by more than 100 civil rights, faith and labor organizations, has released a unified statement titled "Civil Rights Groups Will Not Be Silenced" (read the full statement here) in response to the administration’s exploitation of recent violence to threaten civil rights and nonprofit organizations.  This movement is rooted in nonviolence. This is an attempt to threaten, criminalize, intimidate, and censor those who advocate for civil rights and government accountability. 

They created the following document to help us navigate during this time: Civil Rights Messaging Toolkit & Memo: Speaking Out Despite Government Censorship & Threats.

Latest Updates (As of September 23, 2025, 11:00 AM ET)

Free Webinar: What Nonprofits Need to Know About the Current Federal Grant Landscape

Register today to join the National Council of Nonprofits for a national webinar on Monday, October 6th at 3:00 PM ET to learn more about what nonprofits need to know about the current federal grant landscape.

Risk of Government Shutdown

Congress must enact a full-year spending bill or a short-term gap measure before the start of the new federal fiscal year on October 1, or it risks a government shutdown. The National Council of Nonprofits has created an overview of steps nonprofits should take now to prepare in the event the shutdown occurs.  

Press Release Condemning Escalating Dangerous Rhetoric Against Nonprofits

Washington, D.C. — “Political violence has no place in America. Our strength lies in debate, persuasion, and the ballot box. The recent escalation of violence — from the assassination of Charlie Kirk, to the killing of Minnesota State Rep. Melissa Hortman and her husband, to the attempted assassination of President Donald Trump, to the arson attack on Governor Josh Shapiro and his family — underscores the devastating consequences of hate across the political spectrum.

Nonprofits are the backbone of our communities — connecting neighbors to safe shelter, nutritious meals, vital healthcare, and much more. Yet the administration, other public officials, and social media influencers have escalated a campaign of dangerous rhetoric, falsely accusing nonprofit organizations of fueling radicalization and political violence.

This reckless rhetoric endangers nonprofit staff and volunteers and threatens the services millions of Americans depend on every day. Nonprofits aren’t faceless institutions — they are our neighbors, professionals, small business owners, clergy, retirees, and volunteers who step in to serve our communities.

Let’s be clear: those making these accusations have presented no evidence linking nonprofit organizations to the political violence of Mr. Kirk's killing. This is not about public safety — it is a calculated attempt to exploit a tragedy in order to intimidate and silence nonprofit voices. This is censorship masquerading as protection.

Nonprofits and their volunteers and staff must be free to pursue their missions without fear of harassment or political retribution, regardless of who holds power.

At a time when our country urgently needs healing and unity, our leaders should reject scapegoating and false attacks. Instead, they should focus on bringing us together to foster dialogue and shared purpose, as nonprofits do every day.”

Latest Updates (As of September 18, 2025, 11:00 AM ET)

White House Weighs Executive Actions Against Left-Leaning Nonprofits The White House is considering executive actions against “liberal” nonprofits like the Ford and Open Society Foundations, with executive orders coming as early as this week. The news prompted 100+ foundations to issue a letter condemning political violence and defending free speech. 

Funding News

  • Major funders pledged $56M for civics education in a bipartisan effort. The initiative is “cross-ideological” and aims to strengthen democratic values and participation.
  • The administration has frozen hundreds of millions of dollars in TRIO grants, the federal educational opportunity outreach programs designed to motivate and support students from disadvantaged backgrounds. The Council for Opportunity in Education estimates $660 million worth of aid has been withheld for more than 2,000 TRIO programs. Most are in limbo; some have ground to a halt.

Latest Updates (As of August 26, 2025, 11:00 AM ET)

Navigating EO 14332: Improving Oversight of Federal Grantmaking

The August 7, 2025 Executive Order has left many nonprofit organizations scrambling to understand its implications, particularly on federal discretionary grantmaking. With the order signaling potentially significant changes in how federal funds are awarded and managed, nonprofit leaders are now facing pressing questions: Will existing funding streams shrink? Can my grants be taken away? What steps should organizations take to prepare and adapt?

Nonprofits must not only interpret the order’s language but also anticipate how federal agencies might implement its provisions in the months ahead. To help nonprofits navigate this uncertainty, we’ve gathered a collection of articles and resources that outline practical steps organizations can take now. These pieces provide insights into what the Executive Order means, how it may reshape federal grantmaking, and the strategies nonprofits can adopt to position themselves for continued success in a shifting funding environment.

Latest Updates (As of August 11, 2025, 11:00 AM ET)

Executive Order: Improving Oversight of Federal Grantmaking 

On August 7, 2025, the administration issued an executive order asserting direct political control over all grant funding, including federally supported research. This sweeping and unprecedented action raises urgent and far-reaching concerns for the nonprofit sector.

Below is information from the National Council of Nonprofits’ Chart of Executive Orders Impacting Charitable Organizations.

  • Requires each agency to have a Presidential appointee to create a review process of new funding opportunity announcements and review discretionary grants to ensure consistency with agency priorities and national interest.
  • Requires review process to incorporate: review and approval of funding opportunity announcements by political appointee, continuation of existing coordination with OMB, review by designated subject-matter experts, review for necessary requirements for adequate evaluation and plain language, interagency coordination, additional review for scientific research discretionary grants, pre-issuance review of discretionary award.
  • Prohibits discretionary awards to be used to fund, promote, encourage, subsidize or facilitate racial preferences, awardees that deny a “sex binary” or “the notion that sex is a chosen or mutable characteristic,” “illegal immigration,” or “any other initiatives that compromise public safety or promote anti-American values.”
  • Prefers discretionary awards to be given to institutions with lower indirect cost rates.
  • Requires discretionary grants to be given to a broad range of recipients and not focused to previous awardees.
  • Requires revision of the Uniform Guidance and other guidance to streamline application requirements and clarify and require discretionary grants to permit termination for convenience.
  • Requires each agency to revise the terms and conditions to permit immediate termination for convenience or clarify termination is permitted if no longer advancing agency priorities or the national interest and requires the terms in all future grants and regulations.
  • Requires language in future discretionary grant agreements to prohibit recipients from drawing down general funds for projects without the affirmative authorization of the agency and to provide written specific explanations or support for requests for each drawdown.

We will continue to update this blog as new developments, interpretations, lawsuits, and actions become available. 

Latest Updates (As of July 31, 2025, 11:00 AM ET)

Rescissions Act of 2025

On July 24, 2025, H.R.4 - Rescissions Act of 2025, became law. This bill rescinds $9.4 billion in funds that were provided to the Department of State, the U.S. Agency for International Development (USAID), various independent and related agencies, and the Corporation for Public Broadcasting. 

Specifically, the bill rescinds funds that were provided to the State Department or the President for:

  • Contributions to International Organizations,
  • Contributions for International Peacekeeping Activities,
  • Global Health Programs,
  • Migration and Refugee Assistance,
  • the Complex Crises Fund,
  • the Democracy Fund,
  • the Economic Support Fund,
  • Contributions to the Clean Technology Fund,
  • International Organization and Programs,
  • Development Assistance,
  • Assistance for Europe, Eurasia, and Central Asia,
  • International Disaster Assistance, and
  • Transition Initiatives.

The bill also rescinds funds that were provided for:

  • USAID Operating Expenses,
  • the Inter-American Foundation,
  • the U.S. African Development Foundation,
  • the U.S. Institute of Peace, and
  • the Corporation for Public Broadcasting.

Impact on the County Level

The National Association of Counties (NACo) has been tracking the impacts of recent federal legislation and budget proposals on counties, focusing on the One Big Beautiful Bill Act and its implications for funding, programs, and local governance. The Inside Washington slide deck has additional details and analysis. Below are some highlighted data from the report. 

  • The One Big Beautiful Bill Act represents the largest federal cost shift to counties in modern history, significantly impacting local budgets and services. ​
  • It raises the debt limit from $4 trillion to $5 trillion. ​
  • It cuts Medicaid funding by $1.02 trillion over 10 years.
  • It reduces SNAP funding by $186 billion over 10 years.
  • Administrative costs for SNAP will shift from 50% federal funding to 25%, costing counties an estimated $850+ million annually in 9 states. ​
  • Executive Order 14239 aims to streamline FEMA processes and shift accountability to state and local levels. ​

Proposed Cuts in President's FY 2026 Budget

The President's FY 2026 budget proposes significant cuts to non-defense programs while increasing defense spending. ​

  • Non-defense spending is proposed to be cut by 22.6%, totaling a $163 billion reduction. ​
  • Defense spending is set to increase by 13%, amounting to a $119.3 billion increase.
  • Programs proposed for elimination or significant reduction:
    - Economic Development Administration (EDA): Complete termination
    - Community Development Block Grant (CDBG): Complete termination
    - Community Services Block Grant (CSBG): Complete termination
    - HOME: Affordable housing program cuts
    - Forest Service: 76% reduction ($16.8B → $4B)

Latest Updates (As of July 17, 2025, 11:00 AM ET)

Johnson Amendment

For over 70 years, a key provision in the federal tax code, Section 501(c)(3), commonly known as the Johnson Amendment, has played a crucial role in preserving the integrity of charitable work. This provision states that in exchange for receiving tax-exempt status, a charitable nonprofit, foundation, or religious organization may: “not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.”

Since its enactment in 1954, this language has served as a safeguard for charitable nonprofits, houses of worship, foundations, and the donors who support them. It ensures that organizations committed to the public good can remain focused on their missions, free from the divisiveness of partisan politics.

On July 7, 2025, the IRS and the National Religious Broadcasters filed a Joint Motion for Entry of Consent Judgement requesting a federal court to declare that the Johnson Amendment and nonprofit nonpartisanship is unconstitutional because it prohibits 501(c)(3) organizations from engaging in political speech. The parties jointly request that the Texas federal court provide relief by prohibiting enforcement of the Johnson Amendment.

If the Johnson Amendment were repealed, it would open the door to politicizing charitable nonprofits, houses of worship, and foundations, essentially dragging them into corrosive partisan battles and turning them into tools for politicians and political operatives.

Follow the responses and resources from the National Council of Nonprofits: 

Sign the letter to tell the administration to protect nonprofit nonpartisanship by July 21, 2025.

Latest Updates (As of July 8, 2025, 10:00 AM ET)

Passage of H.R. 1, AKA “One Big Beautiful Bill Act” 

On July 4, 2025, the president signed H.R.1 (previously known as the “One Big Beautiful Bill Act”) into law. Thanks to the strong advocacy efforts of nonprofits across the country and supportive members of Congress, the final bill introduces a new universal charitable deduction. This provision aims to boost charitable giving among roughly the 90% of taxpayers who do not itemize their deductions.

Despite this positive step, nonprofit leaders caution that the law may ultimately harm millions of Americans by weakening the sector’s ability to respond to growing community needs—needs that are increasingly unmet by both government programs and the private sector. Additionally, the law contains several other measures that may discourage charitable giving at a time when nonprofits are already facing significant financial strain.

Use the resources from the National Council of Nonprofits to follow and understand the impact the bill will have on the sector: 

Latest Updates (As of June 18, 2025, 10:00 AM ET)

Ruling on the National Institutes of Health Funding

On June 16, 2025, District Judge William G. Young ruled on two cases challenging federal funding cancelations—one by a coalition of public health groups and another by several Democratic state attorneys general. He ruled that the administration’s termination of hundreds of grants by the National Institutes of Health was “void and illegal,” and ordered some of them to be reinstated. The judge determined that the directives that led to the grant terminations were “arbitrary and capricious” and said they had “no force and effect.” The ruling only covers grants that have been identified by the plaintiffs in the cases.

The court has not yet published Young's order in the case, but notes from the clerk announced that the challenged directives have been vacated and that the administration was ordered to "promptly comply." When the order is published, we will include it in an update. 

Latest Updates (As of June 10, 2025, 3:00 PM ET)

Setting the Record Straight

On June 4, 2025, the president of the National Council of Nonprofits, Diane Yentel, spoke at a hearing by the House Subcommittee on Government Efficiency on nonprofits titled “Public Funds, Private Agendas: NGOs Gone Wild.” You can read her full remarks here.

Her letter argues that the subcommittee misrepresents the essential role of nonprofits. It emphasizes that America’s 1.5 million charitable nonprofits are trusted, transparent, and accountable partners that deliver crucial services (from disaster relief to daily community support) often in areas underserved by government. Nonprofits undergo rigorous competitive grant selection processes and are subject to strict federal oversight, transparency laws, and audits to ensure responsible use of taxpayer funds. Contrary to partisan criticisms, these organizations are legally nonpartisan, comply with federal and state laws, and provide measurable returns on public investments by filling vital gaps in the nation’s social safety net.

Latest Updates (As of June 4, 2025, 11:00 AM ET)

Recommended Discretionary Grant Funding for Fiscal Year 2026

The Office of Management and Budget released an overview of the president’s recommendations on discretionary funding levels for fiscal year (FY) 2026. They are listed in total and by major agency, with a detailed list of the specific recommended changes that will be incorporated into forthcoming appropriations bill language. The president is proposing base non-defense discretionary budget at $163 billion, which is 22.6% below current-year spending. This will have a significant impact on communities across the United States. 

Resources to Help the Nonprofit Sector Take Action

The Independent Sector, Council on Foundations, United Philanthropy Forum, and National Council of Nonprofits held a joint webinar to discuss Budget Reconciliation and the Charitable Sector. You can find a link to the recording, presentation, and other resources below.

Latest Updates (As of May 28, 2025, 11:00 AM ET)

Protect and Strengthen Nonprofit Organizations in the Tax Package

Next week, the Senate is slated to take up the “One Big Beautiful Bill Act,” the major tax bill approved by the House of Representatives on May 22, 2025. The bill includes changes which could negatively affect nonprofit organizations and the people who depend on them. Now is the time to take a stand and make your voice heard.

Reach out to your members of Congress and encourage them to take the following positions:

  • Reject new or increased taxes on nonprofits and foundations
    Sections 112022 and 112024 of the bill propose tax increases that could reduce the funding available for essential services in communities across the United States. These changes may limit nonprofits' ability to provide support and increase pressure on public services.
  • Reject limits on charitable donation incentives
    Sections 110011 and 112027 suggest reducing tax benefits for people and companies who donate to nonprofits. This could discourage charitable giving and leave nonprofits with fewer resources to carry out their missions.
  • Support expanding tax incentives for charitable giving
    Urge Congress to include the Charitable Act in the bill. This bipartisan proposal, introduced by Senators Lankford and Coons and Representatives Moore and Pappas, would allow taxpayers who don't itemize to still receive a tax break for their charitable donations. See the National Council of Nonprofit’s summary to learn more about the Charitable Act. 

Your participation is crucial to ensuring that nonprofit organizations continue to have the resources they need to address growing community needs. Take action today and let your elected officials know why this issue is important to you.

Free Webinar: Budget Reconciliation and the Charitable Sector

On Thursday, May 29 at 2pm Eastern, the National Council of Nonprofits, Council on Foundations, Independent Sector, and United Philanthropy Forum are offering a free joint webinar addressing budget reconciliation and the charitable sector. The session will provide an in-depth analysis of the tax bill and its provisions harming nonprofits and foundations, as well as an overview of how the nonprofit sector is pushing back on these threats.

Latest Updates (As of May 20, 2025, 11:00 AM ET)

Advocacy Is Working—But It’s Not Over

The Council on Foundations, Independent Sector, National Council of Nonprofits, and United Philanthropy Forum are pleased to announce that lawmakers have now struck harmful language from the budget reconciliation legislation that would have allowed the Secretary of the Treasury to unilaterally designate section 501(c)(3) nonprofits as “terrorist supporting organizations” without due process. 

While this represents a meaningful advance on a critical issue, significant work remains to ensure the final budget reconciliation legislation supports (rather than undermines) charitable nonprofits and philanthropy, especially as communities grow more reliant on their services. To learn more about the bill and the steps you can take, read the National Council of Nonprofits article.

Federal Grant Opportunities Being Released

Although the funding freeze had slowed the release of federal grant opportunities to a near standstill, there has been an uptick in new postings over the past week. If you’ve been waiting for a specific opportunity, now is a good time to check Grants.gov regularly.

Keep in mind that some Requests for Proposals (RFPs) have changed significantly from previous versions. Be sure to review each one carefully and take note of any updates or new requirements.

Latest Updates (As of May 13, 2025, 12:00 PM ET)

Take Action on the Latest Draft Tax Bill 

The National Council of Nonprofits released an article discussing a new draft tax bill and its potential impact on the nonprofit sector. The new draft bill, released by the House Ways and Means Committee, includes several provisions that could significantly affect nonprofit organizations and the communities they serve. 

From proposed changes that would expand the federal government’s authority over nonprofit status to increased taxes on private foundations and university endowments, the legislation introduces a number of policy shifts that deserve close attention. It also proposes adjustments to charitable giving incentives, which may offer new opportunities if expanded. In addition, changes to safety net programs like Medicaid and SNAP could have downstream effects on the populations that many nonprofits support. 

With the bill moving quickly through the legislative process, nonprofit leaders are encouraged to review the article, understand the potential impacts, and consider engaging with lawmakers to ensure the sector’s perspectives are represented.

Latest Updates (As of May 5, 2025, 12:00 PM ET)

Additional Tracking Resources for Discretionary Grants

The Democratic staffs of the House and Senate Appropriations Committees compiled a tracker, 100 Days In, Trump Blocks At Least $430 Billion Dollars in Funding Owed to American People. The tracker details the minimum amount of federal funding the Committees believe the administration is currently freezing, cancelling, or fighting in court to block. This list is not comprehensive or exhaustive. 

On Friday May 2, 2025, the administration released the president's recommendations on discretionary funding levels for fiscal year 2026. The FY26 “skinny budget” released on Friday includes significant funding reductions and references specific nonprofit organizations, particularly those focused on diversity, equity, and inclusion (DEI) and environmental justice. It also presents a critical view of nongovernmental organizations more generally.

Latest Updates (As of April 29, 2025, 2:00 PM ET)

President’s First 100 Days

As reported in this blog, the current administration initiated a broad freeze on federal grants and loans, impacting over 2,600 programs. This action disrupted funding for numerous nonprofits, including those focused on social services, education, environmental initiatives, and more. Although a federal judge temporarily blocked the directive, the uncertainty has caused significant operational challenges for many organizations.

Some recent programs affected include:

  • AmeriCorps: The administration moved to dismantle AmeriCorps, canceling grants and planning to reduce its workforce by 85%. This prompted a lawsuit from 24 states and the District of Columbia, arguing that the president lacks the authority to unilaterally dismantle the program.
  • Meals on Wheels: Proposed budget cuts threaten the sustainability of Meals on Wheels, a program providing meals to over 2 million seniors annually. Reductions in funding sources like the Social Services Block Grant (SSBG), the Supplemental Nutrition Assistance Program (SNAP), and Medicaid could lead to service reductions or closures.
  • Environmental Justice Grants: The Environmental Protection Agency canceled 781 environmental justice grants, totaling over $1.5 billion. These grants were intended to support community resilience projects addressing climate change impacts.

The National Council of Nonprofits is tracking all of the Executive Orders impacting the nonprofit sector as legal challenges work through the court system.

In summary, the initial 100 days of the president’s second term have introduced significant challenges for the nonprofit sector, including funding uncertainties, regulatory changes, and increased political scrutiny. Nonprofits are navigating a complex landscape, seeking alternative funding sources, and engaging in legal actions to counteract the administration's policies. The long-term implications of these developments remain to be seen as organizations adapt to the evolving environment.

To help organizations adapt to these anticipated changes, GrantStation is offering a TargetED webinar series focused on shifting perspectives from past approaches to current realities. You can register for the full series or choose to attend individual sessions.

TargetED Series: Shifting Perspectives to Enhance Your Grant Competitiveness
Funders are shifting expectations—seeking strategic alignment, scalable programs, and sustained impact. Our new series will explore the adjustments you must make to stay competitive. Over 6 sessions you’ll learn how to realign your strategies—from partnerships to program design—to meet today’s requirements and unlock new opportunities. Throughout the series, you’ll learn how to:

  • align your proposals with emerging funding trends and strategic priorities;
  • communicate economic impact effectively to strengthen your case for support;
  • craft strength-based narratives that highlight resilience and community assets;
  • design innovative, scalable programs that demonstrate long-term sustainability;
  • develop strategic accountability frameworks to showcase measurable impact; and,
  • use compelling storytelling to create memorable and persuasive grant applications.

The series is currently underway—you can still join the remaining sessions and get recordings of previous sessions. Register Today.

Latest Updates (As of April 16, 2025, 2:00 PM ET)

National Preliminary Injunction

Judge Mary S. McElroy, United States District Judge. granted the National Council of Nonprofits and co-plaintiffs' motion for a nationwide preliminary injunction preventing the current administration from freezing, halting, or broadly pausing funding awarded under the Inflation Reduction Act or the Infrastructure Investment and Jobs Act.  The judge further ordered the administration to take immediate steps to resume the processing, disbursement, and payment of already-awarded funding appropriated under these laws, and to release awarded funds.

McElroy concluded that the seven nonprofit plaintiffs demonstrated that the freeze was “arbitrary and capricious” and that the powers asserted by the federal agencies, including the White House’s Office of Management and Budget, in halting the payouts were not found in federal law.

“Agencies do not have unlimited authority to further a President’s agenda, nor do they have unfettered power to hamstring in perpetuity two statutes passed by Congress during the previous administration,” she wrote.

Latest Updates (As of April 8, 2025, 11:00 AM ET)

On April 4, 2025, the Supreme Court cleared the way for the Trump administration to cancel millions of dollars in federal education grants because it said they funded programs that involve diversity, equity, and inclusion initiatives. The court split in granting a request from the Justice Department to pause a federal district court order that required the Department of Education to reinstate the grants that had been awarded to universities and nonprofit organizations in eight states. The court said in an unsigned opinion that its stay will remain in place while legal proceedings move forward.

Rhode Island U.S. District Chief Judge John McConnell ordered the Federal Emergency Management Agency (FEMA) to stop withholding grant funds to states, finding the administration in violation of a preliminary injunction he issued last month. He ordered the Trump administration to "immediately cease" its efforts to impede the disbursement of federal funds, finding the government directly violated his order.

Latest Updates (As of April 1, 2025, 11:00 AM ET)

Courts Continue to Weigh In

On March 26, 2025, the 1st U.S. Circuit Court of Appeals declined to pause an injunction that prevents government agencies from freezing billions of dollars in federal funding. A panel of three judges ruled that the federal government did not demonstrate it would suffer irreparable harm by complying with the injunction, which requires the continued flow of funds to states.

By upholding the lower court’s decision, the appeals court affirmed U.S. District Court Chief Judge John J. McConnell Jr.’s earlier finding. Judge McConnell concluded that President Donald Trump exceeded his authority by overriding Congress and implementing a sweeping freeze on funding—an action that, according to the court, came at the expense of some of the nation’s most vulnerable communities.

Resources to Help Track Federal Actions

Keeping up with the changing funding landscape is a challenging task. To help support the nonprofit sector, GrantStation has pulled together a list of resources that are regularly updated. They include:

Latest Updates (As of March 26, 2025, 10:00 AM ET)

Responding to the Freeze

As the nonprofit sector awaits the outcomes of ongoing court cases, many organizations are developing strategies to navigate an uncertain future. Some grantmakers have announced plans to either scale back programs that may conflict with recent executive orders or increase their payout levels to help offset reductions in government funding. In response, nonprofits are creating contingency plans to address a range of potential funding scenarios.

To help organizations adapt to these anticipated changes, GrantStation is offering a TargetED webinar series focused on shifting perspectives from past approaches to current realities. You can register for the full series or choose to attend individual sessions.

TargetED Series: Shifting Perspectives to Enhance Your Grant Competitiveness
Funders are shifting expectations—seeking strategic alignment, scalable programs, and sustained impact. Our new series will explore the adjustments you must make to stay competitive. Over 6 sessions you’ll learn how to realign your strategies—from partnerships to program design—to meet today’s requirements and unlock new opportunities. Throughout the series, you’ll learn how to:

  • align your proposals with emerging funding trends and strategic priorities;
  • communicate economic impact effectively to strengthen your case for support;
  • craft strength-based narratives that highlight resilience and community assets;
  • design innovative, scalable programs that demonstrate long-term sustainability;
  • develop strategic accountability frameworks to showcase measurable impact; and,
  • use compelling storytelling to create memorable and persuasive grant applications.

The series begins April 14th. Register Today.

Latest Updates (As of March 19, 2025, 11:00 AM ET)

USAID

On March 18, 2025, Judge Theodore D. Chuang of U.S. District Court for the District of Maryland ruled that Elon Musk and his team likely violated the Constitution “in multiple ways” and robbed Congress of its authority to oversee the dissolution of an agency it created when it shuttered the U.S. Agency for International Development (USAID).

He also ordered that: 

  • USAID agency operations be partially restored;
  • Email access to all USAID employees be reinstated;
  • The team must submit a plan for employees to reoccupy a federal office from which they were evicted; and
  • Mr. Musk’s team be barred from engaging in any further work related to the shutdown of USAID.

Latest Updates (As of March 11, 2025, 10:00 AM ET)

On Monday, March 10, 2025, Judge Amir H. Ali of the Federal District Court for the District of Columbia barred the Trump administration from “unlawfully impounding congressionally appropriated foreign aid funds” that the State Department and the U.S. Agency for International Development (USAID) owed to grant recipients and contractors, requiring it to pay for work completed in the first several weeks of the President’s term.

The order further prohibited the State Department and USAID from implementing much of the January 24, 2025 memorandum outlining plans to reorient and shrink U.S. foreign aid. While forcing the administration to pay for work completed before February 13, 2025, Judge Ali said the limits of the case prevented him from ordering payments on future work or restoring canceled contracts.

Latest Updates (As of March 6, 2025, 1:00 PT ET)

Supreme Court Decision

On March 5, 2025, the Supreme Court rejected the President’s emergency request to freeze nearly $2 billion in foreign aid. This decision vacated the pause order issued by the Chief Justice on February 26, 2025. However, this action did not determine the standing of the funding freeze but required that “the District Court should clarify what obligations the Government must fulfill to ensure compliance with the temporary restraining order, with due regard for the feasibility of any compliance timelines.”

Latest Updates (As of March 4, 2025, 3:00 PT ET)

Another Holding Pattern

The OMB freeze on federal grants is awaiting a response from the U.S. Supreme Court. 

Educational Resource for Nonprofit Organizations

The proposed federal grant freeze is creating significant financial uncertainty for nonprofits. While the future remains unclear, now is the time to take proactive steps to protect your organization’s financial health and sustainability.

Join Alice Ruhnke of GrantStation for this free 60-minute webinar to explore strategies for mitigating risk, securing funding, and adapting to this evolving landscape.

You’ll learn:

  • the status of the federal funding freeze and its potential impact on the nonprofit sector;
  • how to pivot your grantseeking to private, community, and corporate foundations;
  • strategies for building diversified funding streams to reduce dependency on federal grants; and,
  • how to communicate the impact of your work compellingly to attract new funding sources.

Don’t let uncertainty paralyze your nonprofit’s grant strategy. Equip yourself with the knowledge and tools to adapt and thrive in these chaotic times.

Latest Updates (As of February 27, 2025, 12:00 PM ET)

Preliminary Injunction Issued

On February 25, 2025, U.S. District Court Judge Loren L. Alikhan issued a preliminary injunction of the OMB’s freeze on federal grant disbursements that has put essential services across the nation in jeopardy. A preliminary injunction is a court order restraining a party from doing some specified thing, until the matter is settled, or until the Court has issued a further directive.

Specific orders include: 

  • “Defendants are enjoined from implementing, giving effect to, or reinstating under a different name the unilateral, non-individualized directives in OMB Memorandum M-25-13 with respect to the disbursement of Federal funds under all open awards.”
  • “Defendants must provide written notice of the court’s preliminary injunction to all agencies to which OMB Memorandum M-25-13 was addressed.  The written notice shall instruct those agencies that they may not take any steps to implement, give effect to, or reinstate under a different name the unilateral, non-individualized directives in OMB Memorandum M-25-13 with respect to the disbursement of Federal Funds under all open awards.  It shall also instruct those agencies to continue releasing any disbursements on open awards that were paused due to OMB Memorandum M-25-13.”
  • “Defendants shall file a status report on or before February 28, 2025, apprising the court of the status of their compliance with this Order.”

Diane Yental, President and CEO of the National Council of Nonprofits, responded: “The preliminary injunction is a tremendous relief for thousands of nonprofit organizations throughout the country that are struggling to continue their vital work in the midst of the chaos and confusion caused by the administration’s attempted federal funding freezes. These organizations have been left to wonder whether they’ll be reimbursed for their vital work, or if they’ll need to shut down essential programs. OMB’s reckless federal funding freeze would cause catastrophic and irreversible harm to nonprofits and the communities and people they serve. This preliminary injunction allows such nonprofits to continue with their important work of providing wildfire mitigation, disaster relief, services to survivors of domestic violence, support for our nation’s veterans, and so much more.” 

Foreign Aid

As previously discussed, U.S. District Court Judge Amir Ali imposed a temporary order requiring the administration to allow billions of dollars in foreign assistance to flow by midnight February 26, 2025. 

On February 26, 2025, Chief Justice John Roberts paused the court-imposed midnight deadline that would have required the administration to release $2 billion in frozen foreign aid.  The Chief Justice called for the groups that sued the administration to respond by Friday, February 28, 2025.

Latest Updates (As of February 25, 2025, 5:00 PM ET)

Preliminary Injunction on Funding Freeze

On February 11, 2025, the National Council of Nonprofits et al filed a Preliminary Injunction to keep the administration from implementing a blanket funding freeze. The administration responded on February 12, 2025, in opposition to the motion for a Preliminary Injunction. There was a hearing on February 20, 2025, in the U.S. District Court on the motion for a Preliminary Injunction and we are awaiting the judge’s ruling. 

USAID and Foreign Aid

On February 13, 2025, U.S. District Judge Amir Ali issued a restraining order halting a broad freeze on aid-related programs. At a hearing on February 25, 2025, Judge Ali raised concerns about an order from Secretary of State Marco Rubio (issued five days after the restraining order took effect) which paused $15.9 billion in foreign assistance grants. Judge Ali stated that the State Department's freeze likely violated the law. He ordered the State Department to pay all aid contractors and grant recipients who completed work before his order by midnight on Wednesday (February 26, 2025). Additionally, he required the government to file with the court any "directive or guidance" related to his order or concerning the suspension or termination of aid agreements.

As a result of the funding freeze, on February 23, 2025, USAID said that all its staff except certain essential workers would be put on paid administrative leave, and that 1,600 positions in the United States would be eliminated.

Latest Updates (As of February 20, 2025, 3:00 PM ET)

Holding Pattern

The ongoing federal funding freeze, initiated by the executive branch and currently entangled in legal disputes, continues to remain in effect posing significant challenges for nonprofits receiving or seeking federal support. Potential steps and resources include: 

  • Start Looking for Your Economic Impact: Once RFPs have been “reevaluated and restructured,” they will likely have more focus on the financial return on investment and cost savings to the government. Begin to identify ways to demonstrate the economic impact of your programs. Inaction has a cost. Start to identify it.
  • Diversifying Funding Sources: While this has always been the best practice, now it is critical. Look for funding from foundations, corporations, financial institutions, associations, donors, etc. While private funding will likely never be at the levels of government funding, it can help sustain your organization during critical times. A GrantStation membership can help you find funding sources.
  • Advocate: While it may seem like a bad time to stand up and advocate or bring attention to your cause or organization, there are legal, safe, and effective actions you can take to mobilize stakeholders. To support this effort, GrantStation is offering an Advocacy 101 webinar to help you learn how to make your voices heard.
  • Federal Grants Management Support: If you are receiving federal funding, or are seeking funding in the future, understanding regulatory requirements and developing effective financial management policies is crucial. Seek expert guidance from specialists like Grants Works or similar organizations if in-house expertise is limited.

Latest Updates (As of February 13, 2025, 8:00 PM ET)

OMB Instructions for Federal Financial Assistance

While court cases continue, the Office of Management and Budget (OMB) has published Instructions for Federal Financial Assistance Program Analysis in Support of M-25-13. This directive requires all federal agencies providing financial assistance to complete an attached spreadsheet and submit it to OMB by February 7, 2025. Agencies must report any program with funding or activities planned through March 15, 2025.

Presidential Memorandum on NGO Funding

On February 6, 2025, the president issued a memorandum related to federal funding for non-governmental organizations (NGOs), stating:

“The United States Government has provided significant taxpayer dollars to Nongovernmental Organizations (NGOs), many of which are engaged in actions that actively undermine the security, prosperity, and safety of the American people.  It is the policy of my Administration to stop funding NGOs that undermine the national interest.

I therefore direct the heads of executive departments and agencies (agencies) to review all funding that agencies provide to NGOs.  The heads of agencies shall align future funding decisions with the interests of the United States and with the goals and priorities of my Administration, as expressed in executive actions; as otherwise determined in the judgment of the heads of agencies; and on the basis of applicable authorizing statutes, regulations, and terms.”

The full impact of this vague memo remains uncertain.

Ongoing Challenges for Nonprofits

Despite the rescission of Memorandum M-25-13 and the court-issued temporary restraining orders (TROs) halting the funding freeze, nonprofits and grant recipients are still feeling significant disruptions:

  • Payment Systems Are Overloaded or Down: Federal payment systems, including the PMS (Payment Management System) and ASAP (Automated Standard Application for Payments) are experiencing significant delays and crashes.
  • New Funding Announcements Delayed: Many Notices of Funding Availability (NOFAs) are not being published.
  • Federal Websites Being Scrubbed: Information counter to the Executive Orders is disappearing from government websites.

Latest Updates (As of February 3, 2025, 8:00 PM ET)

Understanding Executive Orders and Their Impact on Funding

On Inauguration Day, the president signed multiple executive orders (EOs) that will significantly impact federal funding. EOs are directives issued by the president that carry the force of law, guiding federal agencies in their operations and policies. Unlike legislation, they cannot be overturned by Congress, though courts may intervene if an EO is challenged. Only a sitting president can rescind or modify an EO issued by a previous administration.

Between January 20, 2025, and January 29, 2025, several EOs were signed, many of which have major implications for the nonprofit sector. A complete list can be found here.

These orders signal a significant shift in federal funding priorities, with widespread implications for nonprofits and grant recipients​.

Foreign Aid

On January 26, 2025, in alignment with the president’s Executive Order on Reevaluating and Realigning United States Foreign Aid, Secretary Rubio paused all U.S. foreign assistance funded by or through the State Department and U.S. Agency for International Development (USAID) for review.

A Nationwide Funding Freeze

On January 27, 2025, the Office of Management and Budget (OMB) issued Memorandum M-25-13, instructing all federal agencies to conduct a comprehensive review of their financial assistance programs. During this review, agencies were directed to temporarily pause all obligations or disbursements of federal financial assistance, effectively freezing funding for countless programs​.

This freeze particularly affected funding for:

  • Foreign aid;
  • Nonprofit organizations;
  • Diversity, equity, and inclusion (DEI) initiatives;
  • Environmental projects; and,
  • Gender-related programs.

Legal Challenges and Court Interventions

This sweeping funding freeze faced immediate legal challenges. By January 28,2025, lawsuits were filed in U.S. District Courts in both the District of Columbia and Rhode Island. The U.S. District Court for the District of Columbia issued an emergency stay, temporarily preventing the enforcement of the funding freeze until February 3, 2025 when further hearings were scheduled​.

Reversal of the Funding Freeze Memo

In response to the court actions and widespread pushback, OMB rescinded its controversial memo (M-25-13) and replaced it with Memorandum M-25-14 on January 29​. However, the White House Press Secretary confirmed that while the Memo M-25-13 was rescinded, the federal freeze remained in effect.

Court Rulings

On January 31, 2025, the U.S. District Court of Rhode Island issued a Temporary Restraining Order (TRO) to halt the administration’s controversial funding freeze. Then, on February 3, the U.S. District Court of the District of Columbia issued a TRO explicitly forbidding the administration from reinstating the funding freeze under a different name. TROs typically last around 10 days, after which a preliminary injunction may be considered​.

For over 25 years, GrantStation has provided tools and resources to help nonprofits connect with funding opportunities and navigate the grant process. As part of this goal, we are closely monitoring recent federal actions and their impact on the nonprofit sector. This article tracks ongoing developments, providing links to source materials.

Action steps you can take today

We understand the challenges nonprofits are facing and are committed to providing support.

Alice Ruhnke

Alice Ruhnke

Alice Ruhnke

President of Education and Outreach
GrantStation

Alice Ruhnke is the President of GrantStation. Having raised over $45 million from federal, state, and private grantmakers, she knows what it takes to get funded. As a former nonprofit program coordinator and director, and the Founder of The Grant Advantage, Alice has a deep understanding of the challenges that nonprofits face. Over the last 20 years she's worked in the trenches with hundreds of nonprofit organizations to improve their capacity to raise funds. Alice is an author and educator with a passion to share her expertise. Her insightful trainings on grant proposal writing and development, community change models, service projects, and measuring outcomes have helped over 4,000 individuals positively impact their communities. Alice earned the Grant Professional Certified (GPC) credential in 2025, a distinguished certification that recognizes expertise in grantsmanship through a rigorous, experience-based examination.