After congressional leaders failed to compromise on FY 2018 appropriations in 2017, they extended FY 2017 appropriations for all government programs and agencies through 1/19, then 2/8, and finally 3/23 before reaching an agreement (see *H.R. 1370 of 3/6/17, *H.R. 195 of 1/3/17, and *H.R. 1892 of 4/4/17). This bill reflects the compromise they reached in the lead-up to the 3/23 deadline, including provisions dealing with military aid to Israel and economic aid for the Palestinians.
Assistance to Israel
No less than $3.1 b. was made available in foreign military financing (FMF) for Israel, including $815.3 m. to be spent outside the U.S. (This is a unique arrangement among all recipients of U.S. military aid; it effectively subsidizes the Israeli defense industry).
Up from $600.735 m. from FY 2017, $705.8 m. was allotted for U.S.-Israeli cooperative programs. From this total, $92 m. was designated for the Israeli government to procure the Iron Dome missile defense system; $2221.5 m. was for the Short Range Ballistic Missile Defense Program (no more than $120 m. of which would be obligated until the Trump administration reached an agreement for co-production in the U.S.); $310 m. was set aside for an upper-tier component of Israel’s missile defense architecture ($120 m. of which was for co-production of Arrow 3 missiles in the U.S.); and $82.3 m. was for the Arrow System Improvement Program.
As in previous years, interest and earnings accrued by the Israeli Arab Scholarship Program’s endowment were authorized for expenditure.
Matching the appropriation from FY 2017, $7.5 m. was designated for resettlement in Israel of emigrants from Eastern Europe.
Finally, Israel was an authorized recipient of financing for the procurement of certain military materials from U.S. commercial suppliers, but only if the president determined there were compelling foreign policy or national security reasons for not supplying such materials via government-to-government sale (Egypt was also made an authorized recipient in this provision).
Funding for the Palestinian Authority (PA) and Programs in the West Bank and Gaza
Support for the PA and programs serving the Palestinians in the West Bank and Gaza was authorized, but as in previous years no specific totals were given. Therefore, the State Department’s budget request was the best indicator for how much money the Palestinians could expect from the U.S. in 2018. Down from $327.6 m. in FY 2017, the department requested $215 m. for the Palestinians in Economic Support and Development Funds (ESDF) to “improve the economic environment in the West Bank and Gaza to advance stability and allow Palestinians, particularly youth, to more fully realize their economic potential.” Apart from ESDF, the department requested $35 m. for the Palestinians from the overall request for International Narcotics Control and Law Enforcement (INCLE) and $1 m. from the request for Nonproliferation, Antiterrorism, Demining, and Related Programs (NADR).
As in previous years, aid for the Palestinians was subject to a slew of restrictions and conditions. Prior to the transfer of any funds, the secretary of state would be required to certify that the purpose was to “advance Middle East peace,” “improve security in the region,” “continue support for transparent and accountable government institutions,” “promote a private sector economy,” or “address urgent humanitarian needs.”
All transfers of Economic Support Funds (ESF) were to be suspended if the Palestinians initiated or actively supported an ICC-authorized investigation into alleged Israeli war crimes or if the Palestinians achieved the standing of a member-state at the UN or any agency thereof outside a negotiated settlement with Israel (Congress retained the old ESF moniker, despite the State Department’s change over to ESDF styling for this category of appropriations). The secretary of state would be permitted a national security waiver of this restriction, so long as he reported to Congress on how an exception would “assist in furthering Middle East peace.” Likewise, the president was authorized to waive the ban on a PLO office in the U.S. if he could certify to Congress that the Palestinians had not obtained member-state status or equivalent standing at the UN or any UN body and that they had not “taken any action […] intended to influence a determination by the ICC to initiate a judicially authorized investigation” into alleged Israeli war crimes against Palestinians. If the president was unable to make these certifications, he was still permitted to waive the ban if he could certify that the Palestinians had entered into “direct and meaningful” negotiations with Israel.
ESF to the Palestinians was to be deducted by an amount equal to that paid out by the PA, the PLO, or any successor organization to Palestinians imprisoned by Israel on terrorism-related charges and to the families of Palestinians killed while attempting to commit acts of terror during the previous calendar year. In a new, related provision this year, Congress attached the full text of the Taylor Force Act to this bill. It barred all ESF for the West Bank and Gaza that “directly benefits” the PA unless the secretary of state could certify that the PA, PLO, or any successor organization has ended the abovementioned payments (see H.R. 1164 of 2/16/17 and the Update in JPS 47  for details).
Finally, the secretary of state would be required to submit 2 reports to Congress: The first about assistance provided to the PA security forces (PASF), including “detailed descriptions” of training, curriculum, and equipment provided, inter alia; the second detailing any “steps taken by the PA to counter incitement of violence against Israelis and to promote peace and coexistence with Israel.”
Support for Egypt
Up to $1.3 b. in FMF and up to $112.5 m in ESF was made available for Egypt, including no less than $35 m. for higher education programs and no less than $10 m. for scholarships for Egyptian students with high financial need.
As in recent years, this aid was subject to a series of restrictions and qualifications. Chief among them, the secretary of state would have to certify that the Egyptian government was “sustaining the strategic relationship with the U.S.” and “meeting its obligations under the 1979 Egypt-Israel Peace Treaty” prior to any transfers. The secretary was also directed to withhold an amount of ESF equivalent to the total expended by the U.S. for bail and by NGOs on legal and court fees in connection with democracy-related trials in Egypt (as in previous years, the secretary would be able to annul this provision by certifying to Congress that Egypt had dismissed the 6/4/13 convictions of 16 U.S. citizens on charges related to using foreign funds to destabilize the government). Finally, $300 m. in FMF was to be withheld until such a time that the secretary could certify that Egypt was taking “sustained and effective” steps to “advance democracy and human rights,” “release political prisoners and provide detainees with due process of law,” “hold Egyptian security forces accountable,” “investigate and prosecute extrajudicial killing and forced disappearances,” and “provide regular access for U.S. officials to monitor such assistance in areas where the assistance is used.” The secretary was allowed to waive this certification requirement if he determined it was in the interest of national security.
An unspecified amount of ESF would be made available for loan guarantees to Egypt. The ESF appropriation listed above was also made available for the creation or operation of one or more “enterprise funds” for Egypt (see *H.R. 2029 of 4/24/15 at congressionalmonitor.org for background on enterprise funds).
Oversight and Policy on Iran
Unspecified ESF was made available for the secretary of state to support the U.S. policy of preventing Iran from achieving the “capability to produce or otherwise obtain a nuclear weapon”; support an expeditious response to any violation of the 7/14/15 Iran nuclear deal; support the implementation and enforcement of sanctions against Iran in connection with terrorism, human rights, ballistic missiles, and weapons proliferation; and for democracy programs in Iran.
As in recent years, the secretary of state was directed to continue filing semiannual reports to Congress on Iran’s compliance with the 7/14/15 nuclear deal; inform the relevant congressional comms. of any new information related to the agreement Iran made with the International Atomic Energy Agency at the time of the 7/14/15 nuclear deal; and submit a report on the status of U.S. and multilateral sanctions on Iran.
Military and Economic Support for Jordan
No less than $1.525 b. was made available for aid to Jordan, including $1.0842 in ESF and $425 m. in FMF.
Assistance to Lebanon
Unspecified ESF, INCLE, and FMF was made available for Lebanon. The INCLE and FMF were designated for the Lebanese Internal Security Forces (ISF) and the Lebanese Armed Forces (LAF) for equipment and programs addressing “security and stability requirements in areas affected by the conflict in Syria.” Furthermore, FMF made available for programs that “professionalize the LAF and to strengthen border security and combat terrorism, including training and equipping the LAF to secure Lebanon’s borders, interdicting arms shipments, preventing the use of Lebanon as a safe haven for terrorist groups, and to implement [UNSC] Resolution 1701,” which called for a full cessation of Israeli-Lebanese hostilities in 2006, inter alia. No support for the LAF was to be made available until the secretary of state submitted a spend plan to Congress, including “actions to be taken to ensure equipment provided to the LAF is only used for the intended purposes.” Finally, none of the aforementioned aid would be made available if the ISF or LAF was controlled by a foreign terrorist organization.
Funding and Restrictions on Relevant Government Entities and International Groups
Prohibition against Direct Funding for Certain Countries: As in previous years, loans, credits, insurance, and guarantees to the governments of Cuba, North Korea, Iran, and Syria were banned.
Coups d’État: Unless the secretary of state can certify that a democratically elected government has subsequently taken power, all assistance would be cut off to any country whose head of government is deposed by military overthrow. This provision did not apply to programs promoting “democratic elections or public participation in the democratic process.”
Notification Requirements: No funds may be appropriated to select countries (including Bahrain, Egypt, Iran, Iraq, Lebanon, Libya, Syria, and Yemen) outside regular comm. of appropriations notification procedures.
Arab League Boycott of Israel: Expressing Congress’s opposition to the boycott, this provision encouraged the Arab League to normalize relations with Israel, called on the president and secretary of state to help end the boycott, and urged the president report to Congress annually on steps taken to do so.
Palestinian Statehood: No support was permitted for the establishment of a Palestinian state unless the secretary of state certifies that certain conditions are met. The governing entity is demonstrating a commitment to peaceful coexistence with Israel and pursuing counterterrorism measures in the West Bank and Gaza. Inter alia, the PA or the governing entity of a new Palestinian state has terminated all claims of “belligerency,” respects the “sovereignty, territorial integrity, and political independence of every state in the area through the establishment of demilitarized zones and other measures, and is working toward establishing a framework to settle the refugee question. The president was permitted a national security waiver on this provision.
Business with the PA in Jerusalem: No funds appropriated in this bill were authorized for expenditure on a diplomatic mission of any kind in Jerusalem, except the U.S. consulate, to conduct business with the PA or any successor government.
Palestinian Broadcasting Corporation (PBC): Funding of the PBC was prohibited.
Assistance for the West Bank and Gaza: Prior to the disbursal of any ESF to programs in the West Bank or Gaza, the secretary of state was required to certify that none of the money would go to any person or group that has participated in or advocated for acts of terrorism and that all grantees have been thoroughly vetted. These provisions were subject to audit and investigation, for which up to $500,000 would be appropriated to USAID. Furthermore, no aid was made available for “the purpose of recognizing or otherwise honoring individuals who commit, or have committed acts of terrorism” or, in a new provision this year, educational institutions named after such individuals.
Limits on Aid to the PA: Barring a presidential national security waiver, aid to the PA was restricted and conditional. If the president exercised the waiver, the secretary of state would have to certify that the PA had established a single treasury account through which to channel aid, established a comprehensive civil service roster and payroll, was working to counter violence against Israelis, and supporting activities promoting peaceful coexistence.
Prohibition of Assistance to the PLO and Hamas: Aid transfers in support of the PLO were barred. No funds were permitted to help pay the salaries of PA employees in Gaza or to support Hamas, any power-sharing government of which Hamas is a member, any government resulting from an agreement with Hamas, or one in which Hamas exercises “undue influence.” The president may waive this restriction if he can certify that all ministers in such a power-sharing arrangement have publicly accepted and complied with 2 principles: recognition of the “Jewish state of Israel’s right to exist” and acceptance of previous bilateral agreements. If the president exercised the waiver, the secretary of state would have to submit to Congress a quarterly report on the power-sharing government and whether all its ministers were continuing to uphold the 2 principles. If the president cannot provide said certification, aid may still be disbursed, but only to specific agencies and programs, including the office of the PA president.
Migration and Refugee Assistance (MRA): Although neither the bill not its explanatory materials included any specific appropriation for the UN Relief and Works Agency (UNRWA), U.S. funding for UNRWA typically comes out of the appropriation for the MRA fund ($2.431 b.). However, U.S. pres. Trump ordered punitive cuts to U.S. aid for UNRWA in 1/2018 (see JPS 47), and it was unclear at the time of this bill’s passage how much, if any, U.S. aid would be transferred to the agency in 2018. Still, the secretary of state would have to certify, prior to the disbursal of any support for UNRWA, that the agency was using its local officers to inspect agency installations and reporting any inappropriate use; addressing any staff or beneficiary “taking steps to ensure” the content of all its education materials are consistent with values of human rights, dignity, and tolerance, as well as being free from incitement; avoiding financial institutions and other entities that would put the agency in conflict with U.S. law; and complying with the UN’s biennial audit requirements.
UN Human Rights Council (UNHRC): No funds were made available for support for the UNHRC unless the secretary of state determined that such support was in the interest of national security and that the UNHRC was taking “significant steps” to remove Israel as a permanent agenda item.
Reconciliation Programs: Up from $26 m. in FY 2017, no less than $30 m. was made available to support “people-to-people” reconciliation programs in areas of civil strife and war around the world.
International Peacekeeping Activities: Down from $1.35466 b. in FY 2017, $967.456 m. was made available for contributions to these activities. Unlike in previous years, the State Department did make specific requests for U.S. contributions to UN Interim Force in Lebanon (UNIFIL) and the UN Disengagement Observer Force (UNDOF). Instead, the department’s budget request included the following: “FY 2018 Requirements pending negotiations on reducing overall UN peacekeeping budget levels or U.S. assessed contributions.”
Complex Crises Fund: Down from $30 m. in FY 201y, $10 m. was made available for this program, which has been used to address instability caused by political transitions in the Middle East.
Broadcasting Board of Governors (BBG): $797.986 m. was made available for the BBG to carry out “international communication activities, and to make and supervise grants for radio and television broadcasting to the Middle East.” The BBG was directed to notify Congress within 15 days if any of its broadcast entities were providing an open platform for designated terrorist groups.