US Appeals Court Gives President Trump the Authority to Cut Billions in Owed USAID Money

Articles | August 13, 2025 | by Catholics for Catholics

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The 2-1 ruling says the president can slash nearly $2 billion in owed USAID payments.

By Catholics for Catholics

It’s over.

In a victory for President Donald Trump, a federal appeals court ruled Wednesday that the Trump administration can reduce up to roughly $2 billion in foreign aid payments that it stopped earlier this year. President Trump seeks to permanently dismantle the U.S. Agency for International Development (USAID). 

Fox News reported that judges on the U.S. Court of Appeals for the D.C. Circuit ruled 2-1 to vacate a lower court’s preliminary injunction resumed earlier this year. The lower court judge had required the Trump administration to continue its payments on nearly $1.98 billion in owed funds for USAID projects formerly approved by Congress, after the Trump administration brusquely ended them earlier this year. The issue has been held up in federal court for months.

Judge Karen L. Henderson, a President George H.W. Bush appointee, said as she wrote for the majority that the plaintiffs did not have the proper cause of action to sue the Trump administration over its decision to hold back the funds, or what is otherwise known as impoundment.

Henderson said the plaintiffs “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 remarked that 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.

Trump delivered an executive order when he took office to end USAID. The move propelled a flurry of federal lawsuits and made its way to the Supreme Court in February. Justices on the high court denied the Trump administration’s request in February to continue its freeze on USAID payments, ruling 5-4 that an earlier Feb. 26 payment deadline had already expired, and remanded the case back to the district court to clarify additional payment details.