Funding freeze fallout: Hawaii nonprofits and state agencies face uncertainty
HONOLULU (KHON2) — The federal grant freeze has sent shockwaves throughout the state, with agencies bracing for the impact. Hawaii has joined 21 other states in a lawsuit to challenge the freeze.Simply said, the federal funding freeze has stunned nonprofit organizations and community advocates.
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'I don't know if it's surprising, but it's certainly a gut wrenching shock to all of us because I don't think any of us were fully prepared,' said Kuhio Lewis, CEO for the Council on Native Hawaiian Advancement.
The sudden halt has left local leaders scrambling to assess the fallout. CNHA receives about $7 million in federal funding, which could jeopardize programs including child care, social services, education and subsidized housing.
'This means people are going to lose their jobs potentially, there's a lot of uncertainty, there's a lot of anxiety and people are just in a state of 'what to do next?'' Lewis said.
The Legacy Foundation, which receives indirect federal funding, is worried for the ripple effect of what the freeze may cause on their sponsorships and partnerships.
'I think ultimately it undermines our ability to serve our community, and it does create a climate of uncertainty for the vital work that we do,' said Zabrina Zablan-Duvauchelle, Legacy Foundation Board vice chair.
The freeze could have significant impact on the Department of Hawaiian Homelands that receives $22 million a year under the Native American Housing Assistance and Self Determination Act and nearly $90 million in its broadband connectivity program.
While the freeze does not affect direct assistance programs like Medicaid, SNAP and Social Security, state agencies such as arts, education, disaster recovery and workforce development, face uncertainty.
The Medicaid portal was down nationwide for a time this morning, but is back online. However, the threat of a freeze is causing fear and confusion, something Hawaii Senator Brian Schatz condemned on the Senate floor Tuesday.
'What is happening today is unconstitutional. It's also against statutory law, but most importantly, it is causing pain across the country,' Schatz said.
Gov. Josh Green said his administration is working to ensure critical services continue and the state is seeking clarity from federal agencies on the freeze's scope.
Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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