LegiStorm

Summary:

In calendar year 2018, the Trump Administration has significantly cut funding for the Palestinians during a time of tension in U.S.-Palestinian relations. Statements by President Trump suggest that the Administration may seek via these cuts to persuade the Palestine Liberation Organization (PLO) to participate in U.S.-led diplomacy on the Israeli-Palestinian peace process. Despite the funding cuts, PLO Chairman and Palestinian Authority (PA) President Mahmoud Abbas and other PLO/PA officials have not reversed their decision to break off diplomatic contacts with the United States, which came after President Trump's December 2017 recognition of Jerusalem as Israel's capital. Various observers are debating what the Administration wants to accomplish via the U.S. funding cuts, and how compatible its actions are with U.S. interests. Some Members of Congress have objected to the cuts, including on the grounds that they could negatively affect a number of humanitarian outcomes, especially in Hamas-controlled Gaza. Some current and former Israeli security officials have reportedly voiced concerns about the effects of drastic U.S. cuts on regional stability. Until this year, the U.S. government had consistently supported economic assistance to the Palestinians and humanitarian contributions to the U.N. Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), even if funding in some cases was reduced or delayed. Bilateral assistance to the Palestinians since 1994 has totaled more than $5 billion, and has been a key part of U.S. policy to encourage an Israeli-Palestinian peace process, improve life for West Bank and Gaza residents, and (since 2007) strengthen the West Bank-based PA vis-à-vis Hamas in Gaza. U.S. contributions to UNRWA through global humanitarian accounts since 1950 have totaled more than $6 billion. The 2018 changes raise questions about the future of various funding streams and U.S. political influence, as well as the impact on other international actors' support of and influence on the Palestinians. Congress has options to determine types and amounts of funding for the Palestinians, and to place conditions or oversight requirements on it. The 2018 changes included Reprogramming $231.532 million of FY2017 bilateral economic assistance that was originally intended for the West Bank and Gaza (including $25 million for East Jerusalem hospitals) for other purposes. Ending U.S. humanitarian contributions to UNRWA. U.S. funding in FY2018 totaled $65 million, contrasted with $359.3 million in FY2017. Deciding to prevent Palestinians from participating in a Conflict Management and Mitigation program (CMM) funded by USAID and the U.S. embassy in Israel. Programs involving Israelis and Palestinians generally receive $10 million annually. Nonlethal U.S. security assistance for the PA security forces has continued, as has PA security coordination with Israel, but a majority of Palestinians support recent PLO recommendations to end the coordination. Legislation enacted in 2018 is also significantly impacting U.S. aid to the Palestinians. Congress enacted the Taylor Force Act (Title X of P.L. 115-141) in March. This law augmented existing legislative provisions to suspend U.S. bilateral economic assistance for the PA unless and until Palestinian officials cease certain payments deemed under U.S. law to be "for acts of terrorism." The Anti-Terrorism Clarification Act (ACTA, P.L. 115-253) became law in October, as an apparent way to ensure that the PLO and PA would be subject to jurisdiction in U.S. courts for past acts of Palestinian terrorism against U.S. citizens. Because the ATCA attempts to use U.S. aid to Palestinians as a means of establishing this jurisdiction, and Palestinian leaders apparently want to avoid that outcome, the ATCA might indirectly lead to a complete end of U.S. bilateral aid to the Palestinians by February 2019. The Trump Administration may not have realized the possible impact of the ATCA when it was enacted, and reportedly may be trying to have Congress change the ATCA to facilitate the continuation of security assistance, at least.