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White House blocks foreign aid funds, demands accounting

Affected money could total $4 billion appropriated for public health, peacekeeping, development and diplomacy programs

The White House budget office has directed the U.S. Agency for International Development, led by Mark Green, above, to cease spending for a range of programs while the administration reviews how much money is left in the various accounts. (Riccardo Savi/Getty Images for Concordia Summit file photo)
The White House budget office has directed the U.S. Agency for International Development, led by Mark Green, above, to cease spending for a range of programs while the administration reviews how much money is left in the various accounts. (Riccardo Savi/Getty Images for Concordia Summit file photo)

For the second year in a row, the White House appears to be considering canceling billions of dollars in appropriated foreign aid funding at a time when Congress would be hard-pressed to block such a move.

Over the weekend, the Office of Management and Budget wrote to the State Department and U.S. Agency for International Development directing the foreign aid agency to cease spending for a range of programs that still have unobligated fiscal 2018 and 2019 balances and would otherwise expire if not spent by Sept. 30.

The amount of affected money could total as much as $4 billion, foreign aid advocates say, or 7 percent of the $55.2 billion that lawmakers originally allocated over the last two fiscal years for a broad range of public health, peacekeeping, development and diplomacy programs now being scrubbed by the administration.

By seeking to temporarily freeze the balances of the foreign aid accounts until after the OMB understands how much money is left in each of them, the letter could be a precursor to putting together a potential package of funding cancellations, known as “rescissions.”

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Under the 1974 Impoundment Control Act, the White House can submit a package of rescissions for congressional approval, which must occur within 45 days of “continuous session,” not counting three or more consecutive days in recess. During the initial 45-day period, the targeted funds can’t be obligated by the particular agency or agencies affected; if Congress doesn’t act during that period, the funds have to be released.

Requests for comment to USAID were referred to OMB. An OMB spokeswoman would not comment on whether the letter was intended to lay the groundwork for a rescissions push, but she defended the move as necessary to prevent wasteful spending.

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“It is incumbent on all federal agencies to properly use funds provided by Congress,” spokeswoman Rachel Semmel said. “In an effort to ensure accountability, OMB has requested the current status of several foreign assistance accounts to identify the amount of funding that is unobligated. On behalf of American taxpayers, OMB has an obligation to ensure their money is being used wisely.”

But the letter nonetheless raised alarm bells because, with lawmakers on a five-week recess, a formal rescissions announcement could mean the State Department and USAID lose their authority to spend the money given the Sept. 30 end-of-fiscal year deadline.

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“It would appear the administration is laying the groundwork to try to circumvent Congress once again with a massive rescission package,” said a senior Democratic Senate aide, who was not authorized to be quoted. “Irrelevant of what the Trump administration may wish, Congress still has the power of the purse, and we appropriated these funds because they are necessary to protect our interests and national security. We are in touch with the State Department and are demanding answers. This scheme would set the precedent for this and all future administrations to ignore spending bills and eliminate spending obligations by jamming Congress with end-of-fiscal year rescission packages.”

The OMB letter was first reported by The Washington Post.

Rescissions redux?

Last August, senators got word OMB was readying a foreign aid rescission package of between $2 billion and $4 billion that would be submitted with less than 45 days before the end of the fiscal year. Senior Democratic and Republican lawmakers, including then-Foreign Relations Chairman Bob Corker and ranking member Robert Menendez, rebuked the administration for contemplating such a move. Ultimately, no rescission package was submitted.

“For the second summer in a row … OMB is singling out America’s civilian national security tools for a potential cancellation of funds that will take America off the global playing field,” Liz Schrayer, CEO of the U.S. Global Leadership Coalition, which advocates strong levels of foreign aid funding, said in a statement.

For the last three years, the White House has produced budget proposals that would drastically slash funding for foreign aid, and each year Congress, on a bipartisan basis, has rejected those proposed cuts.

The “use it or lose it” mentality of federal agencies to spend appropriated funds before they expire at the end of the fiscal year is a well-known reality of Washington. Still, no other federal agency is known to have received a letter from OMB directing it to freeze spending while an accounting is made of the remaining balances.

The letter to USAID freezing spending covers 10 specific accounts. They include categories that fund the United Nations and its affiliated agencies as well as U.N. peacekeeping activities. Funding for European allies and Central Asian partner countries was also halted as was funding for training foreign law enforcement agencies and grants to help foreign militaries purchase U.S. weapons.

Congress’ internal watchdog, the Government Accountability Office, in a December report concluded the administration did not have the authority to strategically time its rescissions announcements in such a way as to cut into Congress’ 45-day review window.

“The statutory text and legislative history of the ICA [Impoundment Control Act], Supreme Court case law, and the overarching constitutional framework of the legislative and executive powers provide no basis to interpret the ICA as a mechanism by which the president may unilaterally abridge the enacted period of availability of a fixed-period appropriation,” the 12-page GAO finding stated.

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Still, lawmakers are clearly nervous the administration could try another end-run around their rescissions review authority. The House-passed fiscal 2020 State-Foreign Operations spending bill contains a provision that would extend to 90 days the availability of expiring funds if lawmakers receive a rescission proposal less than two months before the end of the fiscal year and do not act on the proposal within that period.

While Corker’s successor as Foreign Relations chairman, Jim Risch, is generally more accommodating of White House proposals, South Carolina Sen. Lindsey Graham, who leads the State-Foreign Operations Appropriations Subcommittee, has been a reliable advocate for maintaining high levels of development and humanitarian spending. It remains unclear how vociferous a protest lawmakers will be able to mount this time around.

Kellie Mejdrich contributed to this report.

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