People packing boxes full of food
Sacred Heart Community Service volunteers and staff, including spokesperson Demone Carter (center), pack food distribution boxes. The nonprofit is largely funded by federal dollars. File photo.

The new presidential administration is still pushing a federal funding freeze despite rescinding language detailing it Wednesday — leaving Santa Clara County advocates and officials confused and concerned over the detrimental effects the efforts could have on critical programs.

The executive order from President Donald Trump, released Jan. 27 in an Office of Management and Budget memo, called for a temporary freeze on all federal grants and loans. It’s an effort to prevent money from going to local governments and nonprofits who rely on those loans, but don’t align with the administration’s objectives. The memo was rescinded Wednesday after a federal judge blocked it from going into effect until Feb. 3 and 22 states, including California, planned to sue the Trump administration. The administration remains determined to move forward under the president’s executive order to keep the federal freeze in place despite rescinding the memo.

The efforts have the power to freeze billions of federal dollars funding the county’s social safety net programs, such as low-income preschool program Head Start and homelessness prevention services.

County Executive James Williams said the efforts are sowing uncertainty in the county, its cities and the nonprofit sphere because no one knows how it will affect critical services. He pointed out the county doesn’t have significant reserves to supplement federal funding for the nearly 143,000 residents below the poverty line who may rely on those safety net programs, according to 2024 U.S. Census data. Last year, Santa Clara County was able to close its $250 million budget deficit, but not without cutting $118 million across all departments.

Williams directed county departments to continue serving clients amid the evolving situation.

“The county relies on federal funding to support numerous lifesaving and essential health care and social services programs, and even short-term interruptions in these programs will have devastating consequences for residents here and across the nation,” Williams said in a news release.

Nonprofit heavy-hitters are bracing themselves for the administration’s efforts that could have harmful effects on their services.

Demone Carter, spokesperson for Sacred Heart Community Service, said the nonprofit relies on federal funding to serve the thousands of families who use it for food, clothing, housing, education and job assistance.

Roughly 5% of Second Harvest of Silicon Valley’s budget during fiscal year 2023-24 was from federal funding, spokesperson Diane Baker Hayward told San José Spotlight. She said even though the administration said its efforts won’t affect food stamps and federal funding is a smaller part of their budget, the nonprofit food bank is anxiously watching what happens. Second Harvest provides the majority of food distributed to food banks in Santa Clara and San Mateo counties, serving about 500,000 people per month.

Kyra Kazantzis, CEO of the Silicon Valley Council of Nonprofits, said a federal funding audit would have provided the Trump administration with just as much insight into where money was going and could have avoided spreading panic.

“(The memo was) poorly written, and it (could) have, even if it (got) clarified, bad, unintended consequences,” she told San José Spotlight. “It’s extremely unclear to me what reason other than political the administration would have for doing this, except to create widespread fear and chaos.”
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Carter said nonprofits countywide, including Sacred Heart, won’t sit back quietly while the new administration pushes policies they see as harmful.

“This administration poses a very serious threat to the community that we love and serve,” he told San José Spotlight. “So much of our work in the days to come will be figuring out how we protect our people and how we fight back.”

Contact Annalise Freimarck at [email protected] or follow @annalise_ellen on X.

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