Washington — The Supreme Court on Friday granted the Trump administration’s request to temporarily withhold over $4 billion in foreign aid funding, stepping into a dispute over money Congress had already approved.
The decision follows an earlier order from Chief Justice John Roberts, issued this month, which paused a lower court injunction requiring the administration to spend the funds by the end of September. The court’s ruling appeared to split 6-3, with Justices Elena Kagan, Sonia Sotomayor, and Ketanji Brown Jackson dissenting.
In an unsigned order, the Supreme Court said the harm to the executive branch’s ability to conduct foreign affairs outweighed potential harm to plaintiffs, which include organizations and businesses receiving funding for foreign-aid projects. The court emphasized that the ruling “should not be read as a final determination on the merits” and reflects a preliminary view consistent with standards for interim relief.
Background on the Foreign Aid Dispute
The case concerns more than $4 billion that Congress approved last year for overseas development, peacekeeping operations, and democracy promotion, among other priorities. Last month, President Trump notified Congress he intends to rescind $4.9 billion before the end of the fiscal year via a “pocket rescission” maneuver.
The Government Accountability Office has deemed this move illegal.
The Supreme Court, however, found that at this stage, the administration “has made a sufficient showing” that the Impoundment Control Act—the legal mechanism for canceling congressionally approved funding—blocks the plaintiffs’ lawsuit. That suit had sought to force the president to follow last year’s appropriations law.
In her dissent, Justice Kagan highlighted the high stakes of the case, which she said raises questions about the balance of power between Congress and the executive branch.
“[T]he consequence of today’s grant is significant. … The effect of its ruling is to allow the Executive to cease obligating $4 billion in funds that Congress appropriated for foreign aid, and that will now never reach its intended recipients. Because that result conflicts with the separation of powers, I respectfully dissent.”
Earlier, U.S. District Judge Amir Ali ruled the administration’s refusal to spend congressionally approved funds likely violates federal law governing agency actions. He said the administration could withhold funds only if Congress rescinded them through proper legislation.
The dispute began in February when nonprofits and development companies challenged a 90-day pause on foreign aid programs, initiated by the administration to ensure alignment with the president’s foreign policy. The case has since moved through multiple courts, including the Supreme Court in March, which split 5-4 to leave in place an order requiring the administration to pay roughly $2 billion in already performed foreign-aid work.
Last month, a three-judge panel on the U.S. Court of Appeals for the D.C. Circuit blocked the nonprofits and businesses from suing over claims that the administration violated separation of powers by refusing to spend approved funds. A 2-1 vote overturned Judge Ali’s prior order, which had prohibited the government from withholding the funds.
The panel later amended its opinion, allowing the plaintiffs to pursue relief under different legal arguments. On the heels of that decision, President Trump informed Congress of his plan to rescind $4.9 billion in foreign aid, citing programs he deemed “wasteful” and misaligned with his “America First” foreign policy.
The plaintiffs then sought preliminary relief from Judge Ali, who ruled the administration must spend the $4 billion by the fiscal year’s end on Sept. 30. When the D.C. Circuit declined to freeze Ali’s order, the administration turned to the Supreme Court.
In a filing, Solicitor General D. John Sauer argued that Ali’s injunction “raises a grave and urgent threat to the separation of powers,” adding that it “puts the executive branch at war with itself” by forcing the spending of funds the president seeks to rescind.
Plaintiffs’ lawyers countered that Congress’s appropriations law remains binding and that the administration has been obligated to spend the funds since March 2024.
“[T]he upshot of the government’s theory is that Congress’s signature law meant to control impoundments actually provided the President vast new powers to impound funds, and made it virtually impossible to challenge impoundments in court,” they wrote. “Congress would not have enacted such a self-defeating statute.”
Lawyers warned that allowing the president to withhold the funds would endanger organizations reliant on federal dollars for overseas projects. Democracy International, for example, received 98% of its 2024 revenue from U.S. Agency for International Development awards, and could face bankruptcy if the funds are not spent.
“The pocket rescission of democracy promotion funds is an existential threat to Democracy International,” the plaintiffs wrote.
