Two hours before Rhode Island Assistant Attorney Sarah Rice made the case to a federal court judge in Providence for an even longer and more wide sweeping block to the Trump administration’s federal funding freeze, the White House budget office rescinded its memo.

Confusion clouded the 30-minute virtual hearing Wednesday afternoon, where the intent behind the White House press conference and accompanying social media posts dominated discussion. While Chief Judge John McConnell Jr. didn’t officially grant the temporary restraining order against the Trump administration, he made clear he was persuaded by the arguments of the 23 Democratic attorneys general who filed the lawsuit in federal court in Rhode Island Tuesday.

McConnell asked the attorneys to submit proposed language covering the length of time and breadth of the proposed restraining order, giving the U.S. Department of Justice (DOJ) attorney representing the federal administration 24 hours to respond before McConnell will issue a ruling.

“I agree with the states,” McConnell said. “What I am continuing to question is how an order would look, what the scope of it would be, how it would be directed and implemented.”

Daniel Schwei, the DOJ attorney representing Trump and federal agency directors named in the lawsuit, had asked McConnell to toss the complaint, arguing in a two-page filing submitted minutes before the hearing that the lawsuit was moot in light of the memo being rescinded.

Rice insisted that while the document itself was no longer on the table, the intent to freeze federal funding  remained, requiring immediate action to protect states who rely on the $1 trillion in federal aid for everything from wildfire fighting to transportation projects and social safety net programs like Medicaid.

“The policy, to sum it up, is freeze first, ask questions later,” Rice said. “That is the source of our harm. We cannot proceed in regular order because we are in some ways fighting a decision that has been purposefully obscured.”

Like the lawsuit filed in D.C. by a group of nonprofit, health care and business groups, the AGs’ complaint leans heavily on constitutional framing, framing the Trump administration’s move as a violation of the 10th Amendment, separation of powers and the “spending clause” — which gives the federal purse strings to Congress, not the executive branch.

Second federal judge seems to be prepared to block Trump spending pause

A federal judge in D.C. issued a temporary administrative stay in response to that lawsuit, preventing the Trump administration from freezing federal grants and aid until at least Feb. 3.

However, the AGs’ complaint goes farther, names not only Trump and acting federal budget director Matt Vaeth, but also other federal cabinet members who oversee federal education, emergency, environmental and health care funding. A temporary restraining order would prevent them from enforcing any type of funding freeze, Rice told McConnell.

McConnell appeared to agree, speaking to the “irreparable harm” a freeze would impose on state governments and in turn, the millions of people who depend on their services. 

Even with the memo rescinded, the Trump administration is “acting with a distinction without a difference,” he said.

“Ms. Rice has convinced me that while the piece of paper may not exist, there’s sufficient evidence that the defendants collectively are acting consistent with that directive, and therefore the argument they have about needing a TRO for various legal rights exists,” McConnell said.

The AGs had not filed their proposed wording for a temporary restraining order as of 6:30 p.m. Wednesday.

There’s always a Rhode Island angle

McConnell began the virtual proceeding by welcoming the attorneys to the “creative capital,” home to “some of the finest restaurants and arts and culture scene known to the country.”

McConnell also highlighted the written testimony of Rhode Island Department of Administration Director Jonathan Womer as particularly compelling because Rhode Island is where McConnell lives. Womer was among the slew of administrators across all 22 states who wrote in support of the temporary restraining order to keep critical state services afloat.

Rhode Island has received more than $5 billion in federal funding as of Jan. 28 — equal to more than one third of the state’s fiscal 2025 budget, Womer wrote in his testimony, submitted Tuesday. 

“Understanding OMB 25-13 has been a difficult undertaking,” Womer wrote. “Under one reading, it appears that all federal funding assistance with few exceptions will be paused for more than a week. Under another reading, only certain categories of funding may be paused. But it is unclear exactly which categories may be affected because OMB 25-13 does not specify categories of funds in an identifiable manner. Planning for such an about-face with less than 24-hours notice is not possible.”

State agencies charged with overseeing federally funded programs were unable to access funds on Tuesday, Womer wrote, including the state Medicaid office, which confirmed after calling the Centers for Medicare and Medicaid Services that the system was temporarily down on Tuesday. CMS did not specify when the pause would be lifted, but told Rhode Island Medicaid leaders not to expect any updates in writing, according to Womer’s testimony.

Other state agencies unable to access the federal payment system for essential programs included the Rhode Island Departments of Health, Labor and Training, Environmental Management and Human Services, according to Womer.

Also heavy on Rhode Island leaders’ minds: the fate of the Washington Bridge rebuild, which hinges on $220 million in federal funding that was already approved under the Biden administration. 

Rhode Island’s congressional delegation in a Jan. 25 letter to Vaeth asked for confirmation that the Washington Bridge grant, along with another $250 million in federal funds for other bridgework along Rhode Island’s Interstate 95 corridor, would be released as expected.

“As of filing, there has been no response to clarify that this money would not be impacted,” the Jan. 28 lawsuit against Trump, Vaeth and other federal agency heads reads.

The Rhode Island Office of the Attorney General was one of six co-leads on the lawsuit. Together, the half dozen Democratic attorneys general chose to file in Rhode Island, Tim Rondeau, a spokesperson for the Rhode Island Attorney General’s office, said in an email. 

“Different states will lead different efforts and lead states may choose different venues for filing: Pretty standard,” Rondeau wrote.

McConnell has been a top player in Rhode Island’s political and legal scene for decades. A Providence native and Brown University graduate, he was appointed as a federal judge by President Barack Obama in 2010 and confirmed in 2011. His confirmation came despite objections by U.S. Senate Republicans who criticized McConnell for his prolific donations to top Democratic political action committees and candidates — including Obama and U.S. Sens. Sheldon Whitehouse and Jack Reed — according to a 2020 investigation by CQ Roll Call. McConnell served as treasurer of the Rhode Island Democratic State Committee for 14 years, starting in the 1990s, and was appointed to represent Rhode Island in the 2008 Electoral College vote, Roll Call reported.