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Orange County leaders are trying to figure out what new executive orders and memos from President Donald Trump calling for a freeze on federal funding mean amidst concerns they could lose funding for a variety of federal programs immediately.
The spending stop was temporarily blocked from going into effect on Tuesday afternoon by a federal judge, according to the Associated Press.
The order comes as the county is already facing a possible $22 million shortfall according to supervisors and after a former county supervisor pled guilty to accepting bribes to help direct over $10 million in pandemic era contracts funded by the federal government.
[Read: Orange County Reins in Public Spending Amidst Possible Budget Shortfall]
The confusion comes from a memo from the president’s Office of Management and Budget on Monday, calling for an immediate pause in over $3 trillion of federal funding sent to states and local agencies nationwide.
“To the extent permissible under applicable law, Federal agencies must temporarily pause all activities related to obligation or disbursement of all Federal financial assistance, and other relevant agency activities that may be implicated by the executive orders,” the order reads, signed by Matthew J. Vaeth, the acting director of the office.
Vaeth’s memo went on to specifically call out funding “including, but not limited to, financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal,” as being on the chopping block.
A coalition of 23 state attorneys general, including California Attorney General Rob Bonta, have already filed a lawsuit against the federal government to stop the order from going into effect.
“This directive is unprecedented in scope and would be devastating if implemented,” Bonta said in a Tuesday statement. “Already, it has created chaos and confusion among our residents.”
Over one third of the county’s current budget comes from “intergovernmental revenues,” which includes funding from federal, state and local government agencies, but there isn’t a more detailed breakdown on which dollars specifically come from the federal government.
Supervisors unanimously expressed frustration over the order at their meeting on Tuesday morning, sharing how they were constantly getting updates with different information on what was or wasn’t going to be cut off.
“We’re all speculating up here,” said Supervisor Vicente Sarmiento. “I want to be careful about doing any real time analysis up here given that none of us have any idea of what the consequences are.”
County CEO Michelle Aguirre said that while the county has a no backfill policy on federal and state programs that lose funding, they could face a cash flow issue if they don’t get answers on what programs will be paused.
“We are getting emails that are constantly coming in,” Aguirre said. “It’s really a work in progress. Things are fluid.”
Supervisor Don Wagner called for an immediate review of all the county’s diversity, equity and inclusion programs, asking for details on who was being served and how they’re funded.
“We know the so-called DEI programs have been targeted,” Wagner said, asking if “given this funding uncertainty, we ourselves should put a pause on these programs.”
Sarmiento pushed back on Wagner’s proposal to target DEI programs, calling the discussion a “ridiculous exercise of the time we should be spending up here.”
Wagner also pitched an idea to approach the county’s existing contractors and offer them an extension if they’re willing to cut their prices by around 10-15% , asking staff to look into how that could work.
“I believe there’s an opportunity here to garner some savings for the county through the use of incentives,” Wagner said. “We could be saving up to $100 million or $150 million.”
Sarmiento approved of the idea but said it was important to not try and renegotiate with existing contractors who could then leave, and Supervisor Doug Chaffee approved of the idea to try and extend contracts.
Supervisors also shifted how they oversee their existing contracts, reorganizing their office of procurement to directly report to the county procurement officer and CEO to ensure there was better oversight.
[Read: Are OC Supervisors About to Tighten Up Public Contracts After Bribery Scandal?]
Supervisor Janet Nguyen, who replaced Supervisor Andrew Do on the dais after he pled guilty to bribery, praised the shift that the board unanimously approved.
“We’re identifying from this board and from the CEO’s office on best practices to prevent any future corruption or future manipulation of a board member or county staff,” Nguyen said.
Aguirre praised the shift as well, saying it’d been in the works for nearly three years, and should not negatively impact county staff.
“There will be more things that result in greater oversight,” Aguirre said. “But the employees themselves will stay put…they’re already located out of the departments and they’ll stay in the department they’re supporting.”
Noah Biesiada is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at nbiesiada@voiceofoc.org.
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