Judge Directs Trump Administration to Accelerate Payment of USAID and State Department Debts: What It Means for Foreign Aid

A federal judge recently ordered the Trump administration to act quickly on repaying nearly $2 billion owed to various partners of the U.S. Agency for International Development (USAID) and the State Department. The judge set a deadline of Monday for the administration to pay these nonprofit groups and businesses involved in a lawsuit regarding the sudden halt in foreign aid funding.

U.S. District Judge Amir Ali referred to this payment as a crucial first step. The administration has faced multiple lawsuits as it attempts to unwind the cuts to USAID and resolve a six-week pause on funding, which has forced many organizations to stop crucial aid work and lay off staff worldwide.

During a four-hour hearing, Judge Ali expressed skepticism about the administration’s claim that presidents have broad authority to disregard congressional spending decisions in foreign policy. He stated that suggesting appropriations are optional could have serious consequences for the country.

Ali’s order comes amid ongoing legal challenges regarding the administration’s decision to cancel over 90% of USAID contracts worldwide this month. Just a day prior, the Supreme Court denied the Trump administration’s request to freeze USAID funding, directing Judge Ali to clarify the government’s obligations to comply with earlier rulings requiring the quick release of funds for work already completed.

The funding freeze originated from an executive order signed by President Trump on January 20. Following Judge Ali’s temporary restraining order, the administration sought to appeal his decision, prompting a push for immediate payment for completed work.

The administration claimed it has replaced the blanket funding freeze with individual contract reviews, resulting in the cancellation of thousands of USAID contracts and numerous State Department grants. Despite arguing that the freeze has ended, nonprofit groups contended that the rushed contract terminations did not allow for genuine individual assessments, effectively prolonging the impact of the funding halt.