The Trump administration is preparing to cancel a large swath of federal funding for California, an effort that could begin as soon as Friday, according to multiple sources.
Agencies are being told to start identifying grants the administration can withhold from California. Sources said the administration is specifically considering a full termination of federal grant funding for the University of California and California State University systems.
Singling out one state for massive cuts would be an unusual move, but Donald Trump has long made Democratic-led California a target.
ban local/state agencies from assisting the IRS with tax enforcement
They don’t do that now. The IRS contacts the bank, that’s licensed as a bank by the federal government, and tells them to close your account. Usually the first step is to freeze your assets, then they start taking things. The banks aren’t going to argue, they’re not going to give up their entire business just to protect you, or a single state. Even if it is California.
That is an oversimplification. While the IRS can issue levies to federally regulated banks, it usually requires a formal legal process such as a tax lien or a court order. Banks do not comply automatically without proper documentation. State laws can influence how quickly or effectively the IRS operates, especially if the state limits data sharing, delays cooperation, or questions jurisdiction. Not all banks are federally chartered. Some are licensed at the state level and may face different legal pressures. California cannot stop the IRS entirely, but it can slow down enforcement, create legal friction, and raise the political stakes.
Not counting on the rules applying any longer.