Tomeka B. Scales, Ph.D.
Director, Media Engagement & Communications
703.875.8974
media@pscouncil.org

The U.S. Government Must Pay Its Bills

Arlington, Va. (February  6, 2024) -- The Trump Administration’s January 20 Executive Order (EO) 14169, “Reevaluating and Realigning United States Foreign Aid,” mandated a 90-day review of U.S. foreign development assistance. The EO halted all “new obligations and disbursements” until the review’s results are available. Subsequent actions by the U.S. Department of State and the U.S. Agency for International Development stopped payment on existing contractor invoices. These payments would be for completed work required by existing contracts and for which contractors had already spent the money.  

“Every new administration can and should review existing federal government programs to align them with the administration’s priorities,” said PSC President and CEO David J. Berteau.  “President Trump’s executive order does just that.”

“However, the review does not obviate the fact that the U.S. Government owes PSC member companies about $500 million in unpaid invoices,” Berteau added. “What happens when those invoices are not paid?  Without reimbursement for funds already disbursed, companies will run short of cash. Some, especially small businesses, may soon go out of business.” Berteau noted that PSC’s member companies have already furloughed or laid off nearly 3,500 American workers. 

In addition, guidance from Secretary of State Marco Rubio led to USAID issuing orders for most contractors to stop work on current contracts. However, stop-work orders do not terminate those contracts. Berteau noted that contractors remain ready to resume work as soon as the stop-work order is lifted.

 “This doubles the challenge for contractors,” Berteau said. “They already paid their personnel for work done in the past few months, but the government has not reimbursed companies to cover those costs. In addition, companies must retain the ability to restart work without warning, but they cannot bill USAID for the costs of employee retention during that time. The appropriate action is for the government to meet its responsibilities by paying invoices for past work.”

Find PSC’s recent letter to Secretary Rubio on stop-work orders and foreign assistance review here.

Download a PDF of this press release.

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About PSC
PSC is the leading trade association and voice of the government technology and professional services industry, with more than 400 small, medium, and large member companies that support federal agency missions and functions. Learn more at www.pscouncil.org.