A federal judge on Friday issued a temporary order preventing the Trump administration from withholding federal funding for child care and family assistance programs in five Democratic-led states, providing a short-term pause while the legality of the freeze is reviewed.
U.S. District Judge Arun Subramanian, appointed by former President Joe Biden, said the states had demonstrated sufficient grounds “to protect the status quo” for at least 14 days as the case proceeds in court.
The affected states—California, Colorado, Illinois, Minnesota and New York—collectively receive over $10 billion annually through three federal programs: the Child Care and Development Fund, which helps low-income families access child care; the Temporary Assistance for Needy Families program, which offers cash aid and job training and the Social Services Block Grant, supporting a variety of state-level social services.
The Department of Health and Human Services (HHS) announced the funding freeze last week, citing “reason to believe” that the states were providing benefits to individuals in the country illegally.
Officials did not release evidence to support the claims nor explain why only these five states were targeted.
State attorneys argued the sudden halt was unlawful and had already caused “operational chaos,” potentially disrupting care for vulnerable families, ABC News reported.
New York Attorney General Letitia James, leading the multi-state lawsuit, described Friday’s ruling as a “critical victory for families whose lives have been upended by this administration’s cruelty.”
Jessica Ranucci, representing New York, told the court that at least four of the states had already experienced delayed disbursements and warned that further interruptions could immediately jeopardize child care providers and families dependent on subsidies.
Subramanian emphasized that his order did not address whether fraud occurred in the programs.
Instead, he applied standard emergency relief principles, noting the risk of “immediate and irreversible harm” if funding were cut abruptly. He also cited potential violations of statutory timelines and administrative law, according to Financial Express.
The administration defended its action as a measure to protect taxpayer funds from potential misuse. HHS requested detailed data from the five states, including names and Social Security numbers of recipients going back to 2022.
The freeze coincides with heightened scrutiny of Minnesota, where the nonprofit Feeding Our Future allegedly misappropriated $250 million in pandemic-era funds, resulting in dozens of criminal convictions.
Agriculture Secretary Brooke Rollins separately announced a $130 million hold on Minnesota funds pending justification for future spending, according to News 5 Cleveland.
Judge Subramanian, the first South Asian judge appointed to the Southern District of New York, has overseen several prominent cases, including the sentencing of Sean “Diddy” Combs on prostitution-related convictions.
He previously clerked for Supreme Court Justice Ruth Bader Ginsburg and was a partner at a major New York law firm, giving him extensive experience in constitutional and administrative law.
The temporary restraining order marks the first step in a broader legal review that will determine the administration’s authority to suspend congressionally approved spending.
The outcome could have significant implications for billions in social assistance and clarify the limits of executive power over federal grants.
