Misframing the Trump-Era Appropriations Battles

Appropriations should serve as substantive limits on executive power.

According to the most attractive theory of the U.S. Supreme Court’s recent executive power cases, it has been proceeding along two tracks: It has enhanced the President’s supervisory control over the executive branch while shrinking that branch’s substantive authority.

Some emergency-docket appropriations-related disputes this term seemed to fall between these two tracks. Were district court injunctions ordering agencies to spend time-limited appropriations an interference with presidential management of executive functions? Or did they instead vindicate a central legal constraint on executive power?

In its thinly reasoned and legally surprising rulings in Department of Education v. California and National Institutes of Health v. American Public Health Association, the Court seemed to indulge the former intuition. Yet the latter perspective—recognizing spending laws as a vital substantive constraint on executive power—is the correct overall frame for appropriations-related disputes. The Court should return to this framework in future cases.

The second Trump Administration has made a deliberate push for stronger executive control over spending—a theory that scholars Matthew Lawrence, Eloise Pasachoff, and I have called “appropriations presidentialism.” As part of this push, the Administration immediately paused, modified, or terminated numerous federal grants and contracts, including spending for foreign aid, educational research, health research, and certain services.

Some adversely affected parties sued, and courts issued injunctions requiring the Administration to restore funding. The Administration then sought stays of these rulings from the Supreme Court.

The Court obliged in the first case, Department of Education v. California, which involved certain education-related grants. In a terse unsigned opinion, the Court declared that “the District Court’s ‘basis for issuing the order [was] strongly challenged,’ as the Government [was] likely to succeed in showing the District Court lacked jurisdiction to order the payment of money under the [Administrative Procedure Act].” According to the majority, such claims belonged instead in the U.S. Court of Federal Claims (CFC) because the Tucker Act, a 19th-century statute, gives that court jurisdiction over damages suits based on the breach of an “express or implied contract with the United States” or the violation of a statute or constitutional provision that mandates payment.

The Court extended this reasoning in National Institutes of Health v. American Public Health Association, another emergency-docket ruling a few months later. That case involved “the Government’s termination of various research-related grants,” and the Court once again held that challenges to these terminations belonged in the CFC, not federal district courts. At the same time, the Court declined to stay the district court’s invalidation of agency guidance documents governing grant awards. The decision thus set up a system of bifurcated jurisdiction: Challenges to agency policies belong in federal district courts under the Administrative Procedure Act (APA), while demands for continued payment belong in the CFC under the Tucker Act.

The majority once again offered limited reasoning to support its holdings, and Justice Amy Coney Barrett was the only justice to agree with both jurisdictional conclusions. In a solo concurrence, Justice Barrett explained that splitting the claims made sense because invalidating “the guidance” would neither “reinstate terminated grants” nor “necessarily void decisions made under it.”

The Court’s rulings were surprising because their crux was a determination that education-related and research-supporting grants were contracts for purposes of the Tucker Act. Although the Supreme Court had not squarely addressed these questions, this result was at odds with seemingly settled lower court case law.

The Tucker Act generally gives the CFC exclusive jurisdiction over breach-of-contract suits against the United States for more than $10,000 in damages. But lower courts had not understood most grants as contracts under this statute.

For one thing, a contract requires consideration, and the CFC had held that consideration in a government contract “must render a benefit to the government, and not merely a detriment to the contractor.” In addition, according to some CFC decisions, “generalized” public benefits, as opposed to the provision of goods or services, do not satisfy this requirement. As one opinion put it, grants from the government for a “worthy project,” even with “incidental benefit to the government,” are not contracts supporting Tucker Act jurisdiction.

Furthermore, in many grant-related cases, the payment obligations at issue arguably stem mainly from underlying statutes and regulations, rather than the contract itself, and the Supreme Court held in Bowen v. Massachusetts that the APA permits monetary relief that arises as a “by-product of that court’s primary function of reviewing” challenged agency actions in such cases.

Shunting grant-related claims into the CFC was thus a surprising result and one that could be practically consequential. The CFC can only hear claims by contracting parties or under laws that are “money-mandating”—that is, laws that mandate payment. It generally cannot issue remedies other than damages—though it can “remand appropriate matters to any administrative or executive body or official with such direction as it may deem proper and just”—and it cannot hear claims by parties with more indirect injuries. In any event, damages are an inadequate remedy for parties with ongoing projects and activities. Without continued funding, such parties may need to end research, lay off staff, or even go out of business, meaning that the harms they suffer go beyond a lack of payment that can be remedied down the road.

Why, then, did the Court so casually embrace so consequential a jurisdictional holding? The Court’s failure to offer meaningful reasoning makes it hard to say for sure and illustrates the problems with reaching consequential holdings in emergency orders.

It seems possible, though, that some justices recoiled from the prospect of government by injunction that these cases seemed to represent. Overseeing granular administrative tasks such as grants oversight may tax courts’ institutional competence, even when executive officials are defying the law or acting in bad faith. These cases, moreover, involved high-stakes interbranch clashes in which courts were blocking executive priorities and the President seemed to be encouraging defiance.

In this context, adjudication of damages claims in the U.S. Court of Federal Claims might have seemed like an attractive way of addressing legal questions in a less time-pressured and politically charged context. In effect, the Court may have viewed the cases as presenting a problem of outside interference with internal administrative management, an area where it has tended to protect executive prerogatives.

This possible misframing matters, because if my speculation here about the justices’ intuitions is correct, the trouble is that this perspective on the cases shortchanges the substantive importance of appropriations in contemporary separation of powers.

In earlier decisions rejecting deference to debatable agency interpretations of statutes and requiring specific statutory authorization to address major policy questions, the Roberts Court has sought to protect Congress’s primacy in determining the law and setting national policy. But these adjustments, though important, are marginal.

Even without the power to address major questions or resolve statutory ambiguities, executive agencies enjoy vast statutory and administrative powers due to accumulated delegations and constitutional precedents. As a result, Presidents can often make consequential and politically contested policy choices for the country without Congress’s involvement. The war with Iran is just one dramatic example.

In this context, annual appropriations are a key mechanism of congressional influence. Even if the executive branch can act on its own, it may need Congress to provide continued funding. As Justice Brett Kavanaugh correctly observed in his dissent in this term’s tariff case, each house of Congress often has “de facto veto power” over executive policies such as tariffs whose implementation requires new annual funding.

At this point in history, furthermore, Congress often chooses to make policy through spending rather than changes in substantive law. It does so for various reasons. Among other things, spending may be less vulnerable to judicial review, spending avoids the need to establish new bureaucracies, and the reconciliation process often allows circumvention of certain procedural hurdles that complicate substantive lawmaking. For better or worse, we live in a “republic of spending,” as law professor Jonathan Gould has put it.

Going forward, the Court should give stronger recognition to the centrality of appropriations to contemporary checks and balances. That is not to say that the Court should necessarily reconsider National Institutes of Health v. American Public Health Association. As I have argued elsewhere, the Court, having made these rulings, should now stick with them to avoid setting up a bait-and-switch in which litigants who go to the CFC later find that they should have sued in federal district court.

Nevertheless, in future spending-related disputes, the Court should recognize that appropriations presidentialism is a serious distortion of the branches’ proper roles—one at least as important as the problems of inventive regulatory interpretation and overreaching on major questions that the Court has sought to address in other cases. In this important area, the Court’s central aim should not be to protect executive management but instead to reinforce congressional power.