BOSTON — Boston Mayor Michelle Wu is facing criticism for funding wellness grants for queer and transgender migrants amid a $100 million budget shortfall, spending that her office confirmed was inappropriate.

Wu has been the subject of online backlash after an advertisement from a nonprofit indicated the city was spending taxpayer money on “wellness allowance” grants for LGBTQ migrants that can be used for gym memberships, yoga, meditation, reflection activities, transportation, and childcare support, among other uses.

The grants range from $250 to $500, and are distributed by a nonprofit called Outnewcomers that says the program is funded by the City of Boston. Priority is given to “low-income, trans and isolated LGBTQ+ migrants residing in the City of Boston,” and all wellness funds must be used within Boston, the group said.

“LGBTQ+ migrants often face trauma, economic hardship, and social isolation,” Outnewcomers said on its website. “Belonging matters supports healing through community, movement, creativity, and culturally grounded practices that help participants feel more supported, connected, and resourced.”

The city’s spending on the program has generated a firestorm of criticism directed at the mayor on social media after it was first reported by Mass Daily News, an independent outlet, and then shared widely online.

Wu’s office issued a statement to The Boston Herald Thursday that sought to distance the mayor from the wellness grant spending. Her office confirmed the program was funded by the city, but said the nonprofit was using the funds inappropriately.

Wu’s office said grant funding does not allow for cash assistance. The city awarded the nonprofit a $7,500 grant, but the funds were not designated for and may not be used for the voucher program referenced in the organization’s recent online posts and materials, her office said.

“No funds have been distributed or directed for these purposes,” the mayor’s office said. “The organization received a $7,500 grant through a city program to support mental health services. These funds were not designated for and may not be used for the voucher program referenced.”

The mayor’s office said the $7,500 grant award to the Outnewcomers nonprofit was allocated from the fiscal year 2026 budget, and has been cut from the upcoming fiscal year 2027 budget.

Outnewcomers issued a statement Thursday that said it was temporarily pausing the city-funded queer migrant wellness grant program, “following safety threats.”

The statement did not mention its inappropriate use of city-issued grant funds, as described by the mayor’s office on Thursday.

“This decision comes after the organization and its founder, Sal Khan, received multiple death threats and threats of being reported to U.S. Immigration and Customs Enforcement (ICE) following the project’s public launch,” the nonprofit said. “These threats have created serious concerns for the safety and well-being of both leadership and the vulnerable community members the program serves.”

Khan said, “While we remain deeply committed to this work, the safety of our community must come first. We are taking this pause to assess risks and ensure that we can continue our mission in a way that protects those we serve.”

His nonprofit added, “Outnewcomers condemns the rise in anti-LGBTQ+ and anti-immigrant hostility that has contributed to these threats. The organization is currently reviewing security measures and exploring next steps to safely resume programming.”

Wu was also criticized this week by two city councilors, Ed Flynn and Erin Murphy, for allocating new discretionary block party grant funding for the FIFA World Cup.

The new grant funding comes at a time when the city and Boston Public Schools are facing a combined $100 million budget shortfall for FY26, and cutting other discretionary grant funding programs that support small businesses and nonprofits, fill vacant storefronts and expand cultural programming for the FY27 budget.

“We are deeply concerned that funding supporting core services, including mental health supports for older adults and youth employment opportunities, has reportedly been reduced or eliminated while new discretionary funding initiatives continue to be actively promoted,” Flynn and Murphy wrote Wednesday in a letter to the mayor.

“At a time when essential services for seniors and young people may be at risk, the city must clearly explain how it is prioritizing resources,” the councilors wrote. “While community events and celebrations can play a positive role, they should not be advanced while programs providing direct care, mental health supports, and job opportunities are being reduced or eliminated.”

Flynn and Murphy requested that the Wu administration “immediately pause” planned grant program cuts for FY27, pending a full review of those changes.

Wu’s office deferred comment to an Instagram post from Wu encouraging residents to apply for “the City of Boston’s block party and cultural affairs grants to support World Cup and summer programs,” and attend a planned informational meeting.

The mayor’s office put the block party grant at $80,000 and cultural affairs community building grant at $100,000. Both are funded with FY26 dollars, but the block grant is privately funded.

Block party grants up to $750 are available for individual residents and groups. Cultural affairs grants are maxed out for organizations at $5,000.

©2026 MediaNews Group, Inc. Visit at bostonherald.com. Distributed by Tribune Content Agency, LLC.