Supreme Court allows Trump administration to withhold billions in foreign-aid funding

The Supreme Court on Friday cleared the way for the Trump administration to withhold nearly $4 billion in foreign-aid funding. Over a dissent by the court’s three Democratic appointees, the justices paused a ruling by a federal judge in Washington, D.C., that would have required the government to commit to spending the funds by Sept. 30, the end of the government’s fiscal year. It was the third time that the Trump administration had come to the Supreme Court seeking temporary relief in the challenge to the funding freeze.

Chief Justice John Roberts had issued an interim order, known as an administrative stay, on Sept. 9 that blocked U.S. District Judge Amir Ali’s order while the justices considered the government’s request. Friday’s decision effectively extends the administrative stay. The brief, unsigned order cautioned that the ruling “should not be read as a final determination on the merits” but instead “reflects our preliminary view, consistent with the standards for interim relief.”

Justice Elena Kagan dissented, in an eight-page opinion that was joined by Justices Sonia Sotomayor and Ketanji Brown Jackson. Kagan wrote that “the effect” of Friday’s order “is to prevent the funds from reaching their intended recipients—not just now but (because of their impending expiration) for all time.”

The court’s order came nearly eight months after President Donald Trump issued an executive order directing that “no further United States foreign assistance shall be disbursed in a manner that is not fully aligned with the foreign policy of the President of the United States.” Shortly after it was issued, Secretary of State Marco Rubio froze all foreign-aid funding through the State Department and the U.S. Agency for International Development while the government carried out a “review of all foreign assistance programs to ensure they are efficient and consistent with U.S. foreign policy under the America First agenda.”

The plaintiffs in this case – several nonprofits that had received foreign-aid funds, or whose members had received such funds – went to federal court in Washington to challenge the freeze.

The Trump administration came to the Supreme Court for the first time on Feb. 26, asking the justices to pause an order by Ali that directed the State Department and USAID to pay, within 36 hours, contractors and grant recipients for work that they had already done.

In a brief, unsigned opinion issued after the deadline for the Trump administration to comply with Ali’s order had already passed, the court – by a vote of 5-4 – left Ali’s order in place. With Roberts and Justice Amy Coney Barrett joining the court’s three Democratic appointees, the majority told Ali that he should “clarify what obligations the Government must fulfill to ensure compliance with” his order.

When the case returned to the lower courts, Ali ruled that the funding freeze likely violated both federal law and the Constitution. He ordered the Trump administration to commit to spending all of the funds that Congress had allocated for foreign aid. The Trump administration returned to the Supreme Court in late August, asking the justices to put that order on hold, but after a ruling by a federal appeals court in Washington rendered the government’s request moot – that is, no longer a live controversy – U.S. Solicitor General D. John Sauer withdrew it.

Sauer came back to the court for the third time on Sept. 8, in the wake of a ruling by Ali that instructed the Trump administration to commit to spending $4 billion in foreign-aid funds before the fiscal year ends on Sept. 30. (The Trump administration will spend approximately $6.5 billion in other foreign-aid funding that Congress had appropriated.) Ali explained that although the Trump administration may “have significant discretion in how to spend the funds at issue,” it does not “have any discretion as to whether to spend the funds” at all.

Sauer contended that Ali’s order “raises a grave and urgent threat to the separation of powers.” In particular, Sauer argued, the Trump administration cannot comply with Ali’s order, because – under a federal law known as the Impoundment Control Act – it had proposed that Congress claw back the $4 billion in funds that Ali had ordered the government to commit to spending. Under the law, Sauer said, the funds can be frozen for up to 45 days to give Congress time to consider the president’s proposal. While that proposal is pending, Sauer said, the Trump administration is unable to comply with Ali’s order and commit the money.

The challengers countered that because the White House had not followed the procedures set out in the Impoundment Control Act, the 45-day period “has not been triggered at all.” Even if that were not true, they continued, “the upshot of the government’s theory is that Congress’s signature law meant to control impoundments actually provided the President vast new powers to impound funds, and made it virtually impossible to challenge impoundments in court.” But it is impossible to believe, they wrote, that Congress would “have enacted such a self-defeating statute.”

Friday’s order, issued 11 days after the last brief filed in the dispute, granted the Trump administration’s request to pause Ali’s order. It explained that at least “at this early stage,” the Trump administration had “made a sufficient showing that the Impoundment Control Act” bars the challengers from bringing claims under the federal laws governing administrative agencies. “And, on the record before the Court,” the order continued, “the asserted harms to the Executive’s conduct of foreign affairs appear to outweigh the potential harm faced by” the challengers.

Kagan characterized the question at the center of the dispute as whether the Impoundment Control Act bars the challengers’ lawsuit “to make the Executive comply with appropriations laws.” But in considering the Trump administration’s request, she suggested, the court is operating in “uncharted territory” because neither the Supreme Court nor the lower courts have previously considered in any depth how the law operates. “And, to repeat,” she wrote, “the stakes are high: At issue is the allocation of power between the Executive and Congress over the expenditure of public monies.”

In Kagan’s view, the dispute was not one that was “a likely candidate for a grant of emergency relief.” The justices had been required “to consider this application on a short fuse,” “with scant briefing, no oral argument, and no opportunity to deliberate in conference.” Moreover, she continued, there is no decision by a federal court of appeals, “much less a set of decisions expressing different views.” Because the Trump administration had not, she wrote, “made a strong showing that [it] is likely to succeed on the merits” or, that if the district court’s order stays in effect, that it will be permanently harmed, the justices “should have denied this application, allowed the lower courts to go forward, and ensured that the weighty question presented here receives the consideration it deserves.”