Federal Judge Orders Trump Administration to Restore Foreign Aid Funding Amid Legal Battle
A federal judge has intervened in an ongoing legal dispute over the Trump administration’s decision to pause foreign assistance funding, ordering the government to comply with a temporary restraining order and restore payments to contractors and nonprofits. On Tuesday, U.S. District Judge Amir Ali ruled that the State Department and the U.S. Agency for International Development (USAID) must pay all outstanding invoices and Drawdown requests for work completed before February 13 by midnight on Wednesday. The order comes after plaintiffs—a group of businesses, nonprofits, and organizations involved in foreign aid work—argued that they had been cut off from federal funding due to President Trump’s executive action and subsequent directives from Secretary of State Marco Rubio, which froze foreign development aid for 90 days.
Contractors Left in Financial Limbo Despite Court Order
Despite Judge Ali’s temporary restraining order (TRO) issued on February 13, the plaintiffs alleged that the Trump administration had failed to take any steps to restore funding or inform federal employees about how to comply with the court’s directive. During an emergency hearing on Tuesday, a Justice Department lawyer was unable to provide specifics on what the administration was doing to unfreeze the funds, prompting Judge Ali to express frustration. “Twelve days into the TRO, you can’t give me any facts about funds being unfrozen under the TRO?” he asked government attorneys. Lawyers for the nonprofits and businesses also pointed out that there had been “zero directives” from the State Department or USAID leadership regarding the resumption of payments, leaving contractors uncertain about whether they would ever receive the millions of dollars owed to them.
Millions in Unpaid Invoices Highlight the Human Cost of the Funding Freeze
The financial impact of the funding pause has been severe for the organizations involved. One of the plaintiffs, DAI Global, an international development company, reported that it was still waiting on $115 million in outstanding bills to USAID, with over $70 million of that amount being more than 30 days overdue. According to a declaration by Zan Northrip, an executive at DAI Global, the company has been forced to provide “up-front financing to the U.S. government of more than $150 million” while waiting for reimbursement. The unpaid invoices are for work completed before Secretary Rubio’s January 24 directive announcing the 90-day pause on new foreign assistance spending.
The financial strain has had real-world consequences for employees. DAI Global has been forced to furlough 124 U.S.-based employees due to the lack of payment, and while some stop-work orders have been lifted, none of the 28 project terminations issued by USAID have been rescinded. This has left many workers in limbo, unsure of when—or if—they will be able to return to their jobs. The situation is particularly dire given the scale of USAID’s operations; in 2023 alone, the agency managed over $40 billion in appropriations, much of which was allocated to U.S.-based organizations that work with local partners around the world.
Trump Administration’s Broader Agenda on Foreign Aid Raises Concerns
The legal battle over the funding pause is part of a larger effort by the Trump administration to reshape or dismantle USAID, a move that has drawn widespread criticism from foreign aid proponents and lawmakers. In a separate but related development, an estimated 4,200 USAID staffers were placed on administrative leave over the weekend after a federal judge denied a motion by unions representing USAID workers to pause the move. The decision has raised concerns about the long-term impact on U.S. foreign aid programs and the ability of the federal government to continue supporting critical development projects worldwide.
Ongoing Legal Battle and Uncertain Future for Foreign Aid Programs
While Judge Ali’s ruling provides some temporary relief for the contractors and nonprofits involved, the broader legal and political battle over foreign aid funding remains unresolved. The plaintiffs have asked the court to order the “immediate payment of all funds owed and due” to them and other USAID and State Department partners, but the Trump administration’s actions—or lack thereof—suggest that the situation may continue to drag on for weeks or even months. The case highlights the challenges faced by organizations that rely on federal funding to carry out their work and raises important questions about the role of the judiciary in ensuring that executive branch actions comply with the law. For now, the fate of millions of dollars in unpaid invoices—and the livelihoods of thousands of workers—remains uncertain.
