NEW ULM – What federal funding is available and for whom?

That was the question gripping many government agencies Tuesday morning following the announcement that the Trump administration was freezing federal grants and loans.

The Office of Management and Budget (OMB) submitted a two-page memo to all federal agencies Monday night ordering them to “temporarily pause all activities related to obligation or disbursement of all Federal financial assistance.”

This memo also requires Federal agencies to identify and review all federal financial assistance programs and supporting activities consistent with the President’s policies and requirements.

This freeze on federal funding has left many wondering if or how this would impact local governments, schools, and nonprofits that depend on federal payments.

The federal payment freeze was set to go into effect at 5 p.m. Tuesday, but a federal judge temporarily blocked it. Though the freeze is on hold, it is unclear what programs will be impacted on a national or local level.

“I do not know the impacts of this yet,” New Ulm City Engineer Joseph Standheim said.

Two major city infrastructure projects were planned to begin in 2025 using federal grants, but the potential freeze creates an uncertain future for the projects.

The two projects are New Ulm’s crosswind runway project at the airport and the 18th South Street Street lift station.

Last year, the U.S. House and Senate passed a 2024 federal budget that included $2.5 million for the re-alignment of New Ulm’s crosswind runway. The crosswind realignment project has been on New Ulm’s radar for nearly 20 years, but the cost had prohibited the project until this funding was made available. The actual cost of the re-alignment was $3.25 million, with the city making up the difference.

The city was expecting to receive $1.125 million in federal funding for a new storm sewer lift station on the 18th S. Street pumping location. The total cost of the lift station is estimated at $2.53 million.

Stadheim said the city did not have the federal funds in hand. Neither project had been put out for bid yet as the city was still working on funding.

“We hoped to start the lift station project during the 2025 season,” Stadheim said. The crosswind runway was tentatively scheduled to start in 2026 after the city went through the land acquisition process. With the freeze, it is unknown if the city can follow this schedule.

“We are working with our partners and legislators to figure out how this will impact us moving forward,” Stadheim said.

New Ulm Housing Coordinator Heather Bregel said the local housing assistance program should not be impacted as payments are typically approved by Congress through the budgeting process each year.

Bregel said the only other federal funding received by housing is the Housing and Urban Development (HUD) capital fund. The fund is provided annually to Public Housing Agencies for development, financing and modernization of public housing developments.

Bregel said the capital grant is typically a significant amount of money that can help make improvements to public housing properties. Last year, the grant was used to place solar panels on public housing.

Bregel was not certain if they would receive the HUD capital grant in 2025 with the freeze, but did not see it hurting the program because no capital project was currently planned for this year.

“There is no immediate need for the funding,” Bregel said. “We have no differed maintenance on properties.

Brown County officials are also uncertain which programs were impacted, if any. Brown County Administrator Sam Hansen said he is attending a virtual meeting with the Association of Minnesota Counties (AMC) Friday to learn more about which programs are impacted.

With several unanswered questions about which programs will be impacted by the freeze, U.S. District Judge Loren L. AliKhan blocked the action, minutes before it went into effect Tuesday. AliKhan’s will pause the freeze until Monday.

Meanwhile, Minnesota Gov. Tim Walz warned of the possibility that several states will plan a lawsuit to block the order.

“We will see President Trump in court, Walz said.”

The state of Minnesota receives $1.9 billion in federal funding every month.

“Minnesota will do what we can to keep the lights on, but we cannot fill the nearly $2 billion hole this will put in the state budget each month. I do not believe this decision was constitutional and we will work diligently to reverse it,” Walz said in a statement. “I have reached out to the President and his supporters in Congress seeking answers … Shutting off this funding will have a devastating impact on peoples’ lives – from cancer patients, to securing our prisons.”