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The U.S. Supreme Court has denied the Trump administration's request to withhold nearly $2 billion in payments to U.S. Agency for International Development (USAID) contractors. The 5-4 ruling supports a lower court's decision to unfreeze the funds but does not mandate immediate payment.
The dispute began when U.S. District Judge Amir Ali issued orders requiring the government to release funds that had been frozen by an executive order from President Donald Trump. The Justice Department sought emergency relief, arguing that it was not feasible to process payments by the deadline. The Supreme Court delayed action for a week before ultimately denying the administration's request.
In its ruling, the court stated that since Ali's deadline had passed, further clarification was needed on the government's obligations. The court directed Ali to consider "the feasibility of any compliance deadlines" moving forward.
The decision drew sharp dissent from four conservative justices. Justice Samuel Alito, joined by Justices Clarence Thomas, Neil Gorsuch, and Brett Kavanaugh, criticized the ruling, questioning whether "a single district-court judge who likely lacks jurisdiction" should have the power to order such payments. Alito added, "I am stunned."
The Trump administration had argued that the order to pay $2 billion immediately was impractical. However, aid organizations and contractors insisted that the funds were crucial for ongoing humanitarian projects, including waterworks in Nigeria, medical supplies in Vietnam and Nepal, and malaria prevention in Africa.
The broader cuts to USAID, part of the administration's push to downsize the federal government, have disrupted global aid operations. Hundreds of programs were frozen or eliminated, leaving many contractors without payment for completed work. Plaintiffs argued that the administration's abrupt actions violated the Administrative Procedure Act.
The Supreme Court's ruling allows the case to proceed in lower courts, where further legal battles over USAID funding cuts are expected. Meanwhile, affected contractors and organizations continue to push for urgent payments, warning of layoffs and disruptions to critical aid services worldwide.
