US appeals court says Trump can slash billions in owed USAID funds

A federal appeals court ruled Wednesday that the Trump administration can slash up to roughly $2 billion in foreign aid payments that it halted earlier this year, delivering a victory to the Trump administration months after President Donald Trump sought to dismantle the U.S. Agency for International Development (USAID). 

Judges on the U.S. Court of Appeals for the D.C. Circuit ruled 2-1 to vacate a lower court’s preliminary injunction handed down earlier this year. The lower court judge had required the Trump administration to resume its payments on nearly $1.98 billion in owed funds for USAID projects previously approved by Congress, after the Trump administration abruptly froze them earlier this year. The issue has been held up in federal court for months.

Writing for the majority, Judge Karen L. Henderson, a President George H.W. Bush appointee, said that the plaintiffs lacked the proper cause of action to sue the Trump administration over its decision to withhold the funds, or what is known as impoundment.

SCOTUS RULES ON NEARLY $2 BILLION IN FROZEN USAID PAYMENTS

The plaintiffs, Henderson said, “may not bring a freestanding constitutional claim if the underlying alleged violation and claimed authority are statutory.”

“Nor do the grantees have a cause of action under the APA because APA review is precluded by the Impoundment Control Act (ICA),” she added, though she noted the U.S. Comptroller General could technically sue under that law.

The 2-1 majority also ruled that the plaintiffs failed to show Trump had acted “plainly” in excess of his executive branch authorities.

 Judge Henderson was joined in the majority opinion by Judge Greg Katsas, a Trump appointee.

It was not immediately clear whether the plaintiffs in the case would seek to have their case reviewed en banc— or by the full panel for the Democrat-majority U.S. Court of Appeals in D.C.— though doing so could afford them some near-term relief, if the full appeals court sided with the federal judge who had issued the preliminary injunction earlier this year.

Regardless, the ruling is a major victory for President Donald Trump, who issued an executive order on his first day in office in January to block nearly all foreign aid…