White House readies $4 billion foreign aid cuts package

Proposal to eliminate unspent funds could ratchet up tensions with Congress over appropriations

President Donald Trump's administration could send Congress a proposal to cancel $4 billion in foreign aid funding in the coming days. (Zach Gibson/Getty Images)
President Donald Trump's administration could send Congress a proposal to cancel $4 billion in foreign aid funding in the coming days. (Zach Gibson/Getty Images)
Posted August 16, 2019 at 9:26am

The White House budget office on Thursday evening sent a proposal to trim unspent foreign assistance funds by “north of $4 billion” to the State Department for review, according to a senior administration official.

The final price tag of the rescissions package, which could also target unspent balances at the U.S. Agency for International Development, would likely change before being formally submitted to Capitol Hill, the official said.

[White House foreign aid cuts to spare Ivanka, Pence favorite programs]

The foreign aid community has been bracing for the rescissions request, which could be sent to Congress within days, because it could effectively cancel previously appropriated funds even without action by lawmakers.

Under the 1974 budget law, the executive branch can only eliminate unspent funds after Congress clears and the president signs implementing legislation. Lawmakers have 45 legislative session days after the rescissions package is submitted to do so, during which time the targeted funds are frozen. But with authority to spend the money set to expire after Sept. 30 regardless, submission of the request would essentially be an end-run around Congress because the State Department and USAID won’t get a chance to obligate the funds.

The Office of Management and Budget lifted a pause on the targeted accounts late last week, but instead chose to “apportion” the funding at a rate of roughly 2 percent a day, posing challenges for State and USAID budget officers.

Critics cite a Government Accountability Office opinion arguing that canceling the money in this fashion would amount to an illegal “impoundment,” or refusal to spend appropriated funds. A person familiar with the process said the GAO is likely to challenge the legality of the White House’s new request. But OMB argues that the 1974 law is silent on submitting rescissions late in the fiscal year, and notes there is precedent for doing so under both Democratic and Republican administrations.

The White House has proposed to soften the blow by exempting global health programs, including to combat HIV/AIDS and other infectious diseases in developing countries. They also want to spare a program championed by President Donald Trump’s daughter and adviser Ivanka Trump that funds women’s economic development programs, as well as funding to protect religious minorities abroad from persecution, a favorite of Vice President Mike Pence.

Nonetheless, proposing some $4 billion in foreign aid programs for cancellation would be a dramatic escalation in the White House’s funding battle with Congress. Tensions were supposed to have eased with enactment of the two-year budget caps deal earlier this month. But Congressional aides have said if the administration moves forward with the State and USAID rescissions, it could lead to a nasty dispute that bodes ill for the fiscal 2020 spending bills.

“Such action would be precedent-setting and a direct affront to the separation of powers principle upon which our nation was built,” the bipartisan leadership of the House Foreign Affairs and Senate Foreign Relations panels wrote to acting White House Chief of Staff Mick Mulvaney and acting OMB Director Russell Vought last week.

“As leaders of the Congressional Committees with oversight responsibility for U.S. foreign policy and the appropriate resourcing and execution of development and diplomacy programs, we would be compelled to use all the tools at our disposal to respond appropriately, should such action be taken,” they wrote.

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