A federal judge has issued a temporary injunction, preventing the administration of President Donald Trump from withholding billions in child care and social service funds from five US states. The ruling, delivered on Friday, 10 January 2026, halts an immediate funding freeze that states argued was causing "operational chaos."
States Challenge "Unconstitutional" Funding Pause
The legal action was brought by the Democratic-led states of California, Colorado, Illinois, Minnesota, and New York. They contested a policy announced just days earlier, on Tuesday, which paused money for three key federal grant programmes. The states asserted in court that the freeze was having an immediate damaging impact and was enacted without a legal basis.
The US Department of Health and Human Services justified the pause by stating it had "reason to believe" the states were providing benefits to people residing in the country illegally. However, the department did not present evidence to support this claim or explain why these five specific states were targeted.
Billions in Vital Support at Stake
The affected programmes are critical for low-income families and children:
- The Child Care and Development Fund: Subsidises child care for children from low-income families.
- The Temporary Assistance for Needy Families (TANF) programme: Provides cash assistance and job training support.
- The Social Services Block Grant: A smaller, flexible fund for a variety of social programmes.
Collectively, the five states receive more than $10 billion annually from these schemes. Jessica Ranucci, a lawyer for New York, warned during a telephonic hearing that delays were already occurring, creating "immediate uncertainty" for childcare providers and families who depend on the money.
Judge's Ruling and Ongoing Legal Fight
US District Judge Arun Subramanian, a nominee of former President Joe Biden, ruled that the states had met the legal threshold to preserve the status quo. His order prevents the administration from blocking the funds for at least 14 days while further arguments are heard in court. He did not rule on the ultimate legality of the funding freeze itself.
The states argue the administration's move is politically motivated and unconstitutional, designed to target political adversaries rather than combat fraud. They contend they already have robust systems to prevent misuse of funds. The federal government had requested extensive data from the states, including names and Social Security numbers of beneficiaries since 2022, which the states resist.
A lawyer for the federal government, Kamika Shaw, stated it was her understanding that the money had not yet stopped flowing. The injunction ensures it will continue while the legal dispute is resolved.
