In a stunning development that signals a major shift in refugee resettlement policies, the Biden administration’s State Department has terminated its contract with the U.S. Conference of Catholic Bishops following a contentious legal battle. The move comes as government lawyers attempt to dismiss a lawsuit challenging Trump-era funding decisions.
At a Glance
- State Department ends contract with U.S. Conference of Catholic Bishops, likely leading to lawsuit dismissal
- Catholic Bishops sued on February 18, claiming federal law violations when refugee funding was halted
- Judge Trevor McFadden previously declined to block funding halt, citing insufficient grounds for temporary restraining order
- Government argues funding pause was rational and aligned with President Trump’s Foreign Aid Order
- Dispute now centers on financial restitution for services already provided by Catholic organization
Biden Administration Cuts Ties With Catholic Refugee Group
The State Department has officially terminated its contract with the U.S. Conference of Catholic Bishops, a move that government attorneys believe should lead to the dismissal of a lawsuit filed by the Catholic organization. The contract termination was formally communicated through a notice filed with the U.S. District Court for the District of Columbia, marking a significant development in the ongoing dispute over refugee resettlement funding.
The lawsuit, initiated by the Conference of Catholic Bishops on February 18, alleged that the government violated federal law by arbitrarily halting funding for refugee resettlement programs. The Catholic organization has been a major partner in refugee resettlement efforts across the country, but now finds itself at odds with the government over financial obligations and program management.
The U.S. Conference of Catholic Bishops (USCCB) is suing the Trump administration over what the bishops say is an unlawful suspension of funding for refugee programs in the United States.
Upon taking office last month, President Donald Trump issued sweeping executive orders… pic.twitter.com/n6NvQt4SoI
— National Catholic Register (@NCRegister) February 21, 2025
Legal Battle Intensifies
Government lawyers have taken a firm stance that the termination of the contract should result in the immediate dismissal of the lawsuit. They argue that any disputes over unpaid money should be addressed in the Court of Federal Claims, effectively changing the venue and nature of the legal challenge.
“The termination of the agreements leaves open only a question of unpaid money under the cooperative agreements, and, to the extent Plaintiff disputes any reimbursement, the dispute needs to [be] brought in the Court of Federal Claims,” government lawyers stated.
U.S. District Judge Trevor McFadden has already declined to block the halt in funding, determining that the Conference of Catholic Bishops failed to meet the necessary criteria for a temporary restraining order. This initial ruling suggested potential challenges for the Catholic organization’s case even before the contract termination.
Trump Policy At Center Of Dispute
The government has defended its actions by pointing to policies established during the Trump administration. According to their argument, the funding pause represented a rational and temporary decision that aligned with a Foreign Aid Order issued by then-President Donald Trump, who had sought greater accountability in foreign aid spending.
“The agencies’ decision to immediately suspend the funding of the Program was rational and consistent with the Foreign Aid Order,” the government maintained.
The Catholic group, however, contends that the termination of the contract does not necessitate dismissal of their case. They continue to seek a preliminary injunction against both the funding suspension and the contract termination, arguing that they are entitled to reimbursements for work already completed under the agreement.
A State Department official was direct in explaining the reasoning behind ending the relationship, stating: “This award no longer effectuates agency priorities,” according to court documents.
