State Department formally notifies Congress it is effectively dissolving USAID

(CNN) — The State Department on Friday formally notified Congress it is effectively dissolving the US Agency for International Development and moving some of its functions under the department.

The reorganization will be done by July 1, the State Department said, sounding a death knell for USAID, a multibillion-dollar agency that fought poverty and hunger around the world.

The shuttering of an agency established by Congress without the legislative branch weighing in is expected to draw legal challenges.

The Trump administration has accused USAID of mismanaging taxpayer dollars and funding overseas programs that aren’t in US interests. Current and former USAID employees and aid experts have countered that the agency, while imperfect, meets vital humanitarian needs and bolsters America’s soft power.

In its first weeks in office, the Trump administration moved to dismantle USAID and freeze almost all foreign assistance, pending a review of those programs. Since then, thousands of USAID employees have been fired or put on leave and billions of dollars in aid contracts have been canceled. Less than 900 USAID employees remained on the job as of last week, according to another notice from the agency to Congress.

The slashing of the agency brought lawsuits from aid groups and USAID employees, some of whom described harrowing journeys home from overseas for which they weren’t reimbursed.

Later on Friday, a federal appeals court greenlit, for now, the Trump administration’s dismantling of the agency.

Three judges on the 4th US Circuit Court of Appeals were unanimous in the decision, which notes that the courts could ultimately decide to reverse the agency’s unwinding but won’t at this time.

USAID was a major initial target of Elon Musk’s Department of Government Efficiency (DOGE) which is cutting thousands of jobs and programs across the entirety of the federal government.

In a note to the remaining USAID employees obtained by CNN, Jeremy Lewin, a DOGE liaison who is a senior official at USAID, said the move would “significantly enhance efficiency, accountability, uniformity, and strategic impact in delivering foreign assistance programs – allowing our nation and President to speak with one voice in foreign affairs.”

“Substantially all non-statutory positions at USAID will be eliminated” as part of the restructuring, Lewin said, and USAID employees will begin getting “reduction-in-force” notices on Friday.

“In the next three months, we will work closely with the State Department to build their capacities to assume the responsible administration of USAID’s remaining life-saving and strategic aid programming,” Lewin said.

The USAID programs that are being allowed to continue under the State Department involve “humanitarian assistance, global health functions, strategic investment, and limited national security programs,” according to USAID’s notification to Congress, obtained by CNN. The development work done by USAID’s regional bureaus around the world are set to be folded into the State Department’s corresponding regional bureaus, the notice said.

“Other functions are likely to be substantially duplicative of existing functions and capabilities at the Department, and would be eliminated in the restructuring plan,” the notice said.

There has been substantial resistance to the shuttering of USAID from senior career officials.

A top USAID was put on leave after issuing a scathing memo blaming Trump political appointees for the US government’s inability to conduct lifesaving humanitarian work.

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