Federal funds are an enormous proportion of the money available for biomedical research. There was also a lot of uncertainty over how broadly this prohibition was going to be interpreted: could new lines be analyzed using equipment bought with federal money? Could you even keep them in a federally-funded fridge? I worked in a lab that was making all sorts of weird contingency plans in case we wanted to handle covered embryonic stem cells. Some of this is undoubtedly the university’s fault, but it was still annoying.