Judge orders Trump administration to speed up payment of USAID and State Department debts
A federal judge on Thursday ordered the Trump administration to speed up its payment on some of nearly $US2 billion in debts to partners of the US Agency for International Development and the State Department, giving it a Monday deadline to repay the nonprofit groups and businesses in a lawsuit over the administration’s abrupt shutdown of foreign assistance funding.
US District Judge Amir Ali described the partial payment as a “concrete” first step he wanted to see from the administration, which is fighting multiple lawsuits seeking to roll back the administration’s dismantling of USAID and a six-week freeze on USAID funding, which has forced US-funded organisations to halt aid and development work around the world and lay off workers.
Ali’s line of questioning in a four-hour hearing Thursday suggested skepticism of the Trump administration’s argument that presidents have wide authority to override congressional decisions on spending when it comes to foreign policy.
US President Donald Trump speaks during an executive order signing ceremony in the Oval Office of the White House in Washington, DC, US, on Thursday, March 6, 2025. Trump exempted Canadian goods covered by the North American trade agreement known as USMCA from his 25% tariffs, offering major reprieves to the US’s two largest trading partners. Photographer: Al Drago/Bloomberg (Bloomberg)
It would be an “earth-shaking, country-shaking proposition to say that appropriations are optional,” Ali said.
“The question I have for you is, where are you getting this from in the constitutional document?” he asked a government lawyer, Indraneel Sur.
Thursday’s order is in an ongoing case with more decisions coming on the administration’s termination of more than 90 per cent of USAID contracts worldwide this month.
Ali’s ruling came a day after a divided Supreme Court rejected the Trump administration’s bid to freeze funding that flowed through USAID.
The high court instructed Ali to clarify what the government must do to comply with his earlier order requiring the quick release of funds for work that had already been done.
The funding freeze stemmed from an executive order signed by President Donald Trump on January 20. The administration appealed after Ali issued a temporary restraining order and set a deadline to release payment for work already done.
The administration said it has replaced a blanket spending freeze with individualized determinations, which led to the cancellation of 5800 USAID contracts — more than 90 per cent of the agency’s contracts for projects — and 4100 State Department grants totaling nearly $US60 billion in aid.
“The funding freeze, it’s not continuing. It’s over,” Sur told the judge on Thursday.
With thousands of the form-letter contract terminations going out within days earlier this month, nonprofits and businesses charge that no actual individual contract reviews were possible, and that the contract cancellations only made permanent most of the across-the-board program shutdowns from the funding freeze.
Donald Trump speaking at the Capitol. (AP)
The AIDS Vaccine Advocacy Coalition, the Global Health Council and other plaintiffs in the lawsuit are seeking back payment for their share of the nearly $US2 billion they and other USAID partners were already owed at the time of the January 20 funding freeze.
Lawyers for the organisations told the court on Thursday they also wanted to see all of the contract terminations reversed, and future terminations follow regulations.
The Trump administration said it recently resumed payment for USAID debts after the funding freeze. But it told the court that its processing of payments was being slowed because it had pulled most USAID workers off their jobs, through forced leaves and firing, as part of the agency shutdown.
Ali noted Thursday that USAID had said it routinely made thousands of payments before the agency shutdown, and that it said it had recently called 100 staffers off leave to process payments.
The administration could continue bringing idled workers off leave to make Monday’s deadline, he said.
