A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit has handed the Trump administration a significant victory in ruling that only the Government Accountability Office (GAO) may challenge the administration’s freeze on foreign aid funding.
The ruling lifts an injunction that required the State Department to continue making foreign aid payments.
In a 2-1 decision issued on Aug. 13, the majority held that the plaintiffs in this case – which are humanitarian nonprofits – lacked legal standing to challenge the Trump administration’s decision to withhold billions in foreign aid.
The court underscored that under the Impoundment Control Act (ICA) of 1974, only GAO – led by the comptroller general – can challenge the administration’s decision to withhold congressionally appropriated funds.
“The grantees lack a cause of action to press their claims,” Judge Karen L. Henderson wrote in the majority opinion. Judge Gregory G. Katsas joined her.
“Instead, the Comptroller General may bring suit as authorized by the ICA,” the majority wrote. “Accordingly, we vacate the part of the district court’s preliminary injunction involving impoundment.”
The Impoundment Control Act restricts a president from cutting Federal funding without the approval of Congress. Under the law, the president can sometimes delay or withhold funding – not cancel it – but it requires that the president notify Congress before doing so.
As the judges pointed out, the ICA authorizes the head of GAO, also known as the comptroller general, to file a lawsuit if the president illegally impounds funds.
GAO has already found several instances this year in which the Trump administration has illegally impounded funds in trying to reconfigure the nation’s budget.
However, a GAO spokesperson told MeriTalk last month that a lawsuit remains a “last resort” for the agency and that no decisions about legal action have been made.
Nevertheless, a lawsuit remains a viable option. In February, Comptroller General Gene Dodaro told lawmakers that GAO was preparing to potentially take President Donald Trump to court over violations of the ICA.
“We need to be careful and thorough because the next step for us is to go to court ourselves,” Dodaro said during a Feb. 25 hearing before the House Oversight and Reform Committee. “Under the Impoundment Control Act, if we say there’s an impoundment – the money’s not released within a certain period of time – we have to go to court.”
“I need to be prepared and be careful because when I go there, I want to win,” he said.