San Francisco — A federal court has granted a preliminary injunction blocking the Trump-Vance administration’s unlawful freeze of more than $10 billion in child care and family assistance funding, restoring critical support for working families, providers, and small businesses across the country. The order in AFSCME v. U.S. Department of Health and Human Services et al. was issued from the bench last night.

The ruling halts the administration’s sweeping actions targeting programs in California, Colorado, Illinois, Minnesota, and New York while the case continues. The court’s decision ensures the essential funding used to help families access safe, affordable child care and support local economies can continue to flow to the communities that rely on it. 

Over the past year, the Trump-Vance administration has repeatedly boasted about terminating federal grants in retribution because the recipients were located in “blue states.” Consistent with that pattern, administration officials, including those at the Administration for Children and Families (ACF), have used vague and unsubstantiated allegations of “fraud” in five Democratic-led states as a pretext to target those states and their residents. 

The lawsuit was brought by unions and small businesses, including the American Federation of State, County and Municipal Employees (AFSCME), Service Employees International Union (SEIU), Main Street Alliance, and AFSCME affiliates United Domestic Workers of America (UDW) and AFSCME Councils 31 and 57. Plaintiffs are represented by Democracy Forward and Beeson, Tayer & Bodoine.

“The court’s decision to block the administration’s illegal funding freeze is a major victory for providers, families and the children they serve,” said AFSCME President Lee Saunders. “The AFSCME members who provide essential child care services in these communities can now focus on what they do best: helping children learn and thrive. We’ll continue to fight the administration’s attempts to slash services for working families to pay for more tax cuts for its billionaire backers.”   

“Child care providers and the families who count on us are breathing a sigh of relief after a federal court temporarily blocked Trump’s illegal funding freeze for child care. The families I serve in Palmdale, California often commute 90+ minutes to and from work daily. For these janitors, grocery store workers, and delivery drivers, access to child care is the difference between putting food on the table and going hungry. Child care also means peace of mind; the parents I support know their children are safe and learning while they work. When Trump attacked child care, he underestimated what providers mean to the families we serve, and our resolve in fighting back. Child care providers will keep fighting to ensure access to care remains available for all working families,” said Wendy Bobadilla, a family child care provider in Palmdale, California who is a member of Child Care Providers United and SEIU Local 99.

“Child care isn’t a partisan issue, it’s essential infrastructure for small businesses and working families,” said Richard Trent, Main Street Alliance Executive Director. “This unlawful funding freeze would have forced parents out of the workforce and left Main Street employers without the workers they depend on. We’re encouraged by the court’s decision to restore these critical funds and ensure communities aren’t punished for political reasons. 

“Once again, we took the Trump-Vance administration to court for trying to play politics with the lives of working families – and won,” said Skye Perryman, President and CEO of Democracy Forward. “The Trump-Vance administration attempted to withhold billions in funding Congress already approved, threatening child care providers, forcing parents out of work, and destabilizing local economies, all to punish communities it disagrees with. The court saw this for what it is: unlawful, abusive, and dangerous. This decision restores critical support for families and makes clear that no administration can weaponize public funding to serve a political agenda.”

The lawsuit challenges the administration’s January 6, 2026, funding freeze as unlawful under the Administrative Procedure Act and the First Amendment. Plaintiffs allege the freeze was imposed without the required legal process, lacked lawful authority, and was driven by improper political motives targeting certain states.

The legal team at Democracy Forward includes Yenisey Rodríguez, Kevin E. Friedl, Shiva Kooragayala, Cortney Robinson Henderson, Joel McElvain, and Robin F. Thurston.

Read the complaint here.