Federal Court Rules Trump Administration Must Release Restricted USAID Funds

A federal judge has ordered that the Trump administration is required to pay remaining foreign aid that is owed to contractors for completed projects. This ruling indicates that the administration likely violated the separation of powers by unlawfully holding back nearly $2 billion in funds authorized by Congress.

U.S. District Court Judge Amir Ali, who was appointed by President Biden, stated that the executive branch likely overstepped its constitutional boundaries in its efforts to prevent payments from the State Department and the U.S. Agency for International Development, also known as USAID, to grant recipients and foreign aid contractors.

In his ruling, Judge Ali asserted, “Here, the executive has unilaterally deemed that funds Congress appropriated for foreign aid will not be spent.” He further noted that the executive branch not only claimed the constitutional authority to decide how to allocate these appropriated funds but also encroached on Congress’s exclusive power to determine whether these funds should be distributed at all.

Case Focuses on Completed Projects

Judge Ali emphasized that the scope of this case is limited to projects finished before February 13. Therefore, he cannot mandate payments for additional work nor reinstate other contracts. As of last Friday, the outstanding amount owed by the government stood at approximately $671 million. Although it remains unclear if further payments have been processed, Ali has instructed the plaintiffs to submit a joint status report by March 14 to update the court on the Trump administration’s compliance with this order.

Plaintiffs are also required to propose a plan for the next steps moving forward. In his 48-page opinion, Ali stated, “The Court is prepared to hold a prompt hearing at the request of the parties to address any feasibility concerns.”

Concerns Over Executive Authority

A significant portion of Judge Ali’s ruling is dedicated to arguments that the Trump administration likely overreached its executive authority as outlined in the Constitution. This conclusion comes after the administration enacted a sweeping freeze on nearly all foreign aid payments via an executive order issued on January 20. Just days later, a memo was released that restricted funding for foreign aid and reconfigured existing contracts.

Past Rulings and Current Challenges

Previously, Ali had mandated that the Trump administration pay all foreign aid funds due for work already completed, which totals around $1.9 billion, with a deadline set for February 26 at 11:59 p.m.

The Supreme Court recently undertook an emergency review of this case but ruled 5-4 to deny the Trump administration’s request to keep the freeze in place. Instead, the Court remanded the case back to the D.C. federal court, directing Judge Ali to clarify the specific payments owed and their timelines.

Government’s Oversight of Foreign Aid

During last week’s court hearing, which extended over four hours, the focus largely centered on the government’s role in reviewing foreign aid contractors and grants. Lawyers representing the Trump administration insisted that they had concluded the review process and had made final decisions regarding aid allocations.

Moreover, Judge Ali probed into whether the Trump administration has the legal authority to terminate projects with funds that have been appropriated by Congress, a concern he specifically referenced in his ruling.

He noted, “The provision and administration of foreign aid has been a joint enterprise between our two political branches. That partnership stems not from convenience but from constitutional obligation.”

Potential for Supreme Court Review

These discussions, along with Ali’s ruling, might lead to further appeals. Should the government challenge any aspects of the memo or the allegations made, the matter could potentially escalate back to the Supreme Court. This underscores the ongoing tension between executive authority and legislative oversight in the administration of federal funds.

As the case unfolds, all eyes will remain on the ensuing legal proceedings, which could set significant precedents regarding the separation of powers, particularly in the context of foreign aid and executive action.