U.S. Foreign Aid to the Palestinians
Jim Zanotti
Specialist in Middle Eastern Affairs
January 18, 2013
Congressional Research Service
7-5700
www.crs.gov
RS22967
CRS Report for Congress
Pr
epared for Members and Committees of Congress
U.S. Foreign Aid to the Palestinians
Summary
Since the establishment of limited Palestinian self-rule in the West Bank and Gaza Strip in the
mid-1990s, the U.S. government has committed over $4 billion in bilateral assistance to the
Palestinians, who are among the world’s largest per capita recipients of international foreign aid.
Successive Administrations have requested aid for the Palestinians to support at least three major
U.S. policy priorities of interest to Congress:
• Preventing terrorism against Israel from Hamas and other militant organizations.
• Fostering stability, prosperity, and self-governance in the West Bank that inclines
Palestinians toward peaceful coexistence with Israel and a “two-state solution”.
• Meeting humanitarian needs.
Since June 2007, these U.S. policy priorities have crystallized around the factional and
geographical split between the Fatah-led Palestinian Authority (PA) in the West Bank and Hamas
in the Gaza Strip.
Informal congressional holds delayed disbursement of various portions of FY2011 aid to the
Palestinians, until the Obama Administration obligated this assistance despite a reportedly
remaining hold. Holds reportedly remain attached to already-appropriated FY2012 U.S. aid. The
holds appear to be largely a response to and anticipation of Palestine Liberation Organization
(PLO) initiatives in the United Nations and other international forums aimed at increasing
international recognition of Palestinian statehood outside of negotiations with Israel. The holds
occur at a time of ongoing structural budgetary crisis in the Palestinian Authority (PA)—
exacerbated by a number of factors—that could threaten stability, especially in the West Bank.
Additionally, some Members of Congress remain concerned about a possible “consensus” PA
government whose composition would require Hamas approval. New conditions on aid from
FY2012 relating both to potential U.N.-related initiatives and a potential consensus PA
government have carried over into FY2013. Some Members of Congress have proposed
additional conditions in anticipation of possible future steps by the PLO to make legal action
possible—including at the International Criminal Court (ICC)—against perceived Israeli
violations of various international laws and norms.
From FY2008 to the present, annual regular-year U.S. bilateral assistance to the West Bank and
Gaza Strip has averaged around $500 million, including annual averages of approximately $200
million in direct budgetary assistance and $100 million in non-lethal security assistance for the
PA in the West Bank. Additionally, the United States is the largest single-state donor to the U.N.
Relief and Works Agency for Palestine Refugees in the Near East (UNRWA). However, whether
UNRWA’s role productively addresses the refugee issue in the context of efforts to mitigate or
resolve the larger Israeli-Palestinian conflict remains a polarizing question.
Because of congressional concerns that, among other things, funds might be diverted to
Palestinian terrorist groups, U.S. aid is subject to a host of vetting and oversight requirements and
legislative restrictions. U.S. assistance to the Palestinians is given alongside assistance from other
international donors, and U.S. policymakers routinely call for greater or more timely assistance
from Arab governments in line with pledges those governments make. Even if the immediate
objectives of U.S. assistance programs for the Palestinians are met, lack of progress toward a
politically legitimate and peaceful two-state solution could undermine the utility of U.S. aid in
helping the Palestinians become more cohesive, stable, and self-reliant over the long term.
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Contents
Introduction: Issues for Congress .................................................................................................... 1
Palestinian U.N.-Related Initiatives and Possible Fatah-Hamas Consensus—Effects on
Aid ................................................................................................................................................ 2
Overview ................................................................................................................................... 2
Congressional Holds .................................................................................................................. 4
FY2012 Aid and FY2013 Request ................................................................................................... 5
Major Conditions, Limitations, and Restrictions on Aid ................................................................. 7
Types of U.S. Bilateral Aid to the Palestinians ................................................................................ 9
Economic Support Fund Project Assistance ............................................................................ 10
Types of Funding Programs .............................................................................................. 10
Vetting Requirements and Procedures ............................................................................... 10
Direct Assistance to the Palestinian Authority......................................................................... 11
U.S. Security Assistance to the Palestinian Authority ............................................................. 13
U.S. Contributions to UNRWA ...................................................................................................... 16
Overview ................................................................................................................................. 16
Issues for Congress .................................................................................................................. 18
Vetting of UNRWA Contributions ..................................................................................... 18
Legislation ......................................................................................................................... 20
Issues for Congress in Determining Future Aid ............................................................................. 22
Possible Additional Palestinian Action in International Forums ............................................. 22
Hamas and a “Unity Government”? ........................................................................................ 23
Questions Regarding a Two-State Solution ............................................................................. 24
The Gaza Situation .................................................................................................................. 25
Strengthening the PA in the West Bank ................................................................................... 26
Economic Development and International Donor Assistance ................................................. 27
In General .......................................................................................................................... 27
Arab States ........................................................................................................................ 29
Conclusion ..................................................................................................................................... 30
Figures
Figure 1. West Bank and Gaza Strip Real Gross Domestic Product (GDP) Per Capita:
1998-2011 ................................................................................................................................... 29
Tables
Table 1. Proposed Spending Plan for FY2012 Bilateral Assistance ................................................ 6
Table 2. Proposed Spending Plan for FY2013 Bilateral Assistance ................................................ 7
Table 3. U.S. Bilateral Assistance to the Palestinians, FY2005-FY2013 ........................................ 9
Table 4. Historical U.S. Government Contributions to UNRWA .................................................. 16
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Appendixes
Appendix A. Recent Historical Background .................................................................................. 31
Appendix B. Congressional Holds on FY2011 Aid ....................................................................... 33
Contacts
Author Contact Information........................................................................................................... 34
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Introduction: Issues for Congress
U.S. aid to the Palestinians is intended to promote at least three major U.S. policy priorities of
interest to Congress:
• Preventing terrorism against Israel from Hamas and other militant organizations.
• Fostering stability, prosperity, and self-governance in the West Bank that inclines
Palestinians toward peaceful coexistence with Israel and a “two-state solution”.
• Meeting humanitarian needs.
Since June 2007, these U.S. policy priorities have crystallized around the geographical and
factional split between
1. West Bank/Fatah: the U.S.- and Western-supported Palestinian Authority
(PA) in the West Bank led by President Mahmoud Abbas (who also leads the
secular nationalist Fatah faction) and Prime Minister Salam Fayyad (a
political independent and former international technocrat); and
2. Gaza Strip/Hamas: the de facto regime led by Hamas in Gaza, which
receives support from Iran along with substantial non-state support and has
been designated a Foreign Terrorist Organization (FTO), a Specially
Designated Terrorist (SDT), and a Specially Designated Global Terrorist
(SDGT) by the U.S. government.1
See Appendix A for recent historical background information. Despite more robust levels of
assistance, factors such as the absence of Israeli-Palestinian peace, Palestinian pursuit of
international support of statehood, and Hamas’s heightened role in Palestinian politics could
make effective implementation of lasting aid projects difficult. Informal congressional holds (see
“Congressional Holds” below) have delayed various portions of already-appropriated FY2011
and FY2012 U.S. aid.
From FY2008 to the present, annual regular-year U.S. bilateral assistance to the West Bank and
Gaza Strip has averaged around $500 million (see Table 3 below), including annual averages of
approximately $200 million in direct budgetary assistance and approximately $100 million in
non-lethal security assistance for the PA in the West Bank. The remainder—approximately $200
million on average per year—is dedicated to project assistance for the West Bank and Gaza
through U.S. government grants to non-governmental organizations (NGOs). Much of this
assistance is in direct support of PA Prime Minister Salam Fayyad’s security, governance,
development, and reform programs aimed at building Palestinian institutions in advance of
statehood. The post-2007 annual average of U.S. bilateral assistance is substantially greater than
the approximate annual average of $170 million from 2000-2007 and $70 million from 1994-
1999.
Because of congressional concerns that, among other things, U.S. funds might be diverted to
Palestinian terrorist groups, this aid is subject to a host of vetting and oversight requirements and
legislative restrictions (see “Major Conditions, Limitations, and Restrictions on Aid” below). U.S.
1 For more information on Hamas and these terrorist designations, see archived CRS Report R41514, Hamas:
Background and Issues for Congress, by Jim Zanotti.
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assistance to the Palestinians is given alongside assistance from other international donors, and
U.S. policymakers routinely call for greater or more timely assistance from Arab governments in
line with the pledges those governments make.
Additional U.S. humanitarian assistance for Palestinian refugees in Gaza and elsewhere continues
through contributions to the U.N. Relief and Works Agency for Palestine Refugees in the Near
East (UNRWA). U.S. contributions to UNRWA, which have totaled more than $4 billion since
UNRWA’s inception in 1950 (see Table 4 below), have averaged over $200 million annually
since 2007.
Palestinian U.N.-Related Initiatives and Possible
Fatah-Hamas Consensus—Effects on Aid
Overview
On November 29, 2012, the U.N. General Assembly (UNGA) adopted Resolution 67/19 by a vote
of 138 member states in favor, nine against (including the United States and Israel), and 41
abstentions. The resolution changed the permanent U.N. observer status of the Palestine
Liberation Organization (or PLO, recognized as “Palestine” within the U.N. system) from an
“entity” to a “non-member state.”2 This change might increase the probability that the
Palestinians and other international actors could take steps—particularly in the International
Criminal Court (ICC)—to make legal action possible against perceived Israeli violations of
various international laws and norms regarding the treatment of people and property in the West
Bank and Gaza.3
The adoption of Resolution 67/19 is part of a broader PLO effort to obtain greater international
recognition of Palestinian statehood, possibly to strengthen the PLO’s hand in future negotiations.
In September 2011, Mahmoud Abbas, who is the PLO’s chairman, applied for Palestinian
membership in the United Nations. Although the application stalled in the Security Council’s
membership committee4 and would have faced a U.S. veto, the Palestinians did obtain
2 The PLO has had permanent observer status at the United Nations since 1974. The change in status effected by
Resolution 67/19 is largely symbolic. “Palestine” maintains many of the capacities it had as an observer entity—
including participation in General Assembly debates and the ability to co-sponsor draft resolutions and decisions
related to proceedings on Palestinian and Middle East issues. However, despite its new designation as a “state,” it is not
a member of the U.N., and therefore does not have the right to vote or to call for a vote in the General Assembly.
3 An April 2012 opinion by the ICC’s Office of the Prosecutor, which determined that there was no basis for it to
consider a declaration of consent by “Palestine” to ICC jurisdiction in the West Bank and Gaza, appeared to rule that
guidance from the UNGA would be decisive in determining whether the PLO or Palestinian Authority had competence
as a state to consent to ICC jurisdiction. International Criminal Court, Office of the Prosecutor, “Situation in Palestine,”
April 3, 2012. One analysis asserts, however, that legal ambiguities remain. John Cerone, “Legal Implications of the
UN General Assembly Vote to Accord Palestine the Status of Observer State,” insights, American Society of
International Law, December 7, 2012.
4 United Nations Security Council, “Report of the Committee on the Admission of New Members concerning the
application of Palestine for admission to membership in the United Nations,” S/2011/705, November 11, 2011.
Paragraph 19 of this report provides a summary of the varying views that committee members advanced regarding
Palestinian membership: “The view was expressed that the Committee should recommend to the Council that Palestine
be admitted to membership in the United Nations. A different view was expressed that the membership application
could not be supported at this time and an abstention was envisaged in the event of a vote. Yet another view expressed
(continued...)
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membership in the U.N. Educational, Scientific and Cultural Organization (UNESCO) in the fall
of 2011. They appear to be using their UNESCO membership to establish and advance claims of
Palestinian “self-determination and cultural rights”5 over sites such as the Church of the Nativity
in Bethlehem. In June 2012, UNESCO inscribed (designated) the church as both a World
Heritage Site and a World Heritage Site in Danger.6 Under U.S. laws passed in 1990 and 1994,7
Palestinian admittance into UNESCO triggered the withholding of U.S. contributions to the
organization.8 These laws would require similar cutoffs of U.S. contributions to the United
Nations and any other U.N. specialized agencies to the extent that the Palestinians were to gain
membership or the same standing as member states in those U.N. entities. Such cutoffs could
adversely affect these entities’ budgets and complicate both the U.S. relationship with individual
U.N. entities and the conduct of U.S. foreign policy within the U.N. system and other multilateral
settings.
Abbas and Hamas political bureau chief Khaled Meshaal reached agreement in principle in May
2011 and February 2012—with mediation from Egypt and Qatar—on arrangements intended to
bridge the Palestinian geographical and factional divide and to clear the way for PA presidential
and parliamentary elections. Internal disagreements within Hamas—possibly reflecting divisions
over Hamas’s overall strategy and relationship with Iran and other countries in the region—are
one of a number of factors that delayed political reunification of the West Bank and Gaza and
cause many observers to doubt its likelihood. However, the popularity of a December 2012
Hamas rally in the West Bank and a January 2013 Fatah rally in Gaza and concern about an
ongoing PA budgetary crisis (see “Economic Development and International Donor Assistance”
below) and prospects for continued stalemate in negotiations with Israel have contributed to
renewed Palestinian hopes of “reconciliation.” Abbas and Meshaal met in Cairo in early January.
Both the U.N.-related actions and the prospect of greater Hamas say in PA governance have
resulted in Congress and the President attaching new legal conditions to U.S. aid to the
Palestinians that have carried over into FY2013.9 For more information on these conditions, see
“Major Conditions, Limitations, and Restrictions on Aid”, “Possible Additional Palestinian
Action in International Forums”, and “Hamas and a “Unity Government”?” below.
(...continued)
was that there were serious questions about the application, that the applicant did not meet the requirements for
membership and that a favourable recommendation to the General Assembly would not be supported.”
5 Isabel Kershner, “UNESCO Adds Nativity Church in Bethlehem to Heritage List,” New York Times, June 29, 2012.
6 Inclusion on the World Heritage List means that a site should be protected and preserved by the global community;
inclusion on the Danger List means that a site is particularly threatened. In response to the designations, David Killion,
U.S. Ambassador to UNESCO, stated that the Danger List is generally reserved only “for extreme cases, such as when
a site is under imminent threat of destruction.” Killion also noted that in the past 40 years, only four other sites had
been added to the Danger List. Statement by Ambassador Killion on the Emergency Inscription of the Church of the
Nativity as a World Heritage Site, U.S. Mission to UNESCO, June 29, 2012.
7 P.L. 101-246 (Foreign Relations Authorization Act, Fiscal Years 1990 and 1991) and P.L. 103-236 (Foreign Relations
Authorization Act, Fiscal Years 1994 and 1995).
8 In the Obama Administration’s FY2013 budget request, it stated its intention to “work with Congress to seek
legislation that would provide authority to waive restrictions” on paying assessed and voluntary contributions to
UNESCO. If Members of Congress sought to lift or modify these restrictions, they could amend the applicable legal
provisions or propose stand-alone legislation.
9 As of January 2013, the provisions of the Consolidated Appropriations Act, 2012 (P.L. 112-74) remain valid for
FY2013, pursuant to the Continuing Appropriations Resolution, 2013 (P.L. 112-175). If not extended or superseded by
an Act of Congress, P.L. 112-175 will expire on March 27, 2013.
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Congressional Holds
Various Members of congressional committees with jurisdiction over the authorization and
appropriation of U.S. aid to the Palestinians placed informal holds on the obligation of various
portions of already-appropriated FY2011 assistance for the Palestinians, as discussed in
Appendix B. Although all of this assistance was reportedly obligated for use by the State
Department by the spring of 2012, similar informal congressional holds appear to be delaying
obligation of already-appropriated FY2012 assistance. On November 30, State Department
spokesperson Victoria Nuland said that the Obama Administration is trying to get Congress to
release all of the U.S. aid for Palestinians that was appropriated for FY2012:
So there’s 495 million [dollars] in Fiscal Year 2012 funds that we have wanted to move.
There’s 200 million in direct budget support for the Palestinian Authority. There’s 195
[million] in economic support funds for programs and projects there. And there is a hundred
million in international narcotics control and law enforcement funds. That’s what’s currently
pending with the Congress for the Palestinian Authority.10
The Administration notified Congress of its intention to obligate these FY2012 funds in April
2012. If delays in aid disbursement result in “decelerations” or shutdowns by the implementing
organizations, additional expense, complication, and delay may ensue with respect to existing or
prospective projects. The U.S. Agency for International Development (USAID) provided the
following information to CRS on January 17, 2013:
Due to the existing hold on FY 2012 [economic support] funding, six projects were expected
to close between March and May 2013. USAID therefore instructed the Chief of Parties for
these projects to decelerate their project activities to continue a lower level of project
implementation—in other words, to extend the duration of the program. With this
deceleration, the six projects are now expected to have sufficient funding through dates that
vary by project, between May-September 2013. All other USAID-funded projects are
expected to run out of existing funds between June-December 2013 if they maintain a normal
project implementation rate. Deceleration can involve the downsize of the project presence in
country, including the termination of implementing partner staff.
On Dec. 30, 2012, the first termination notices were sent out to 17 partner staff working on
the Health Flagship program implemented by Chemonics. The remaining 40 termination
notices are expected to go out to the Health Flagship implementing partner staff between
January 28, 2013 and March 31, 2013.
Congressional holds on foreign aid are not legally binding on the executive branch. However,
since the late 1970s/early 1980s, successive Administrations have generally deferred to holds
placed by Members of pertinent committees. This is part of a process by which the executive
branch consults with Congress to provide it with information or otherwise address committees’
concerns prior to obligating funds subject to a hold. In 2007 and 2008, Representative Nita
Lowey, then chairwoman of the House Appropriations Subcommittee on State, Foreign
Operations, and Related Programs, exercised holds partly in order to shape the conditions under
which the United States could provide budgetary and security assistance to the West Bank-based
PA following Hamas’s takeover of Gaza and its dismissal from the PA government.11
10 Transcript of State Department Daily Press Briefing, Washington, DC, November 30, 2012.
11 “Splits Between U.S. and Europe Over Aid to Palestinians,” International Herald Tribune, February 22, 2007;
(continued...)
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FY2012 Aid and FY2013 Request
Pursuant to the Consolidated Appropriations Act, 2012 (P.L. 112-74), aid to the Palestinians for
FY2012 was reportedly appropriated up to the levels initially requested by the Obama
Administration—$400 million from the Economic Support Fund (ESF) account, $113 million
from the International Narcotics Control and Law Enforcement (INCLE) account. In April 2012,
the Administration notified Congress of its intention to obligate $395.7 million in ESF and $100
million in INCLE for FY2012.12 Partly due to the apparent congressional holds mentioned above
on FY2012 aid, it remains unclear whether and when this aid will be obligated and disbursed. See
Table 1 below for details of the Administration’s spending plan for this aid. The Administration’s
FY2013 budget request seeks ESF and INCLE aid to the Palestinians at reduced levels from
FY2012. See Table 2 below for figures and details of the Administration’s spending plan for the
FY2013 aid.
According to the Administration’s FY2013 congressional budget justification, USAID’s West
Bank and Gaza mission
will undergo a strategic planning exercise in the coming months. As a result of this exercise,
USAID’s strategic objectives in the West Bank and Gaza will be defined in a new five year
strategy which will guide program and resource planning in FY2013 and beyond. As part of
this exercise, past performance of existing USAID projects will be reviewed and future
programmatic choices will be discussed. The Mission’s strategy development process will
help identify the key sectors in which USAID programs can achieve the greatest
programmatic impact with the resources available.13
(...continued)
“Appropriator Wants Palestinian Authority Aid on Hold Until Accountability in Place,” CQ Today, March 4, 2008.
12 USAID FY2012 Congressional Notification #47, April 27, 2012; State Department FY2012 Congressional
Notification #92, April 27, 2012.
13 U.S. State Department, FY2013 Congressional Budget Justification for Foreign Operations (Annex: Regional
Perspectives).
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Table 1. Proposed Spending Plan for FY2012 Bilateral Assistance
Amount Purpose
Economic Support Fund
($395.7 million total)
$200 million
Direct budgetary assistance to Palestinian Authority (PA) in West Bank
$195.7 million
Assistance for the West Bank and Gaza (through USAID)
•
$17.3 million – governance, rule of law, civil society
•
$94.1 million – health, education, social services
•
$62.6 million – economic development
•
$21.7 million – humanitarian assistance
International Narcotics Control
and Law Enforcement
($100 million total)
Approx. 2/3
Training, non-lethal equipment, and garrisoning assistance to PA security
forces in the West Bank, supporting efforts by the U.S. Security Coordinator
Approx. 1/3
Assistance for PA Ministry of Interior and for the justice sector (prosecutors
and criminal investigators) to improve performance, efficiency, and inter-
institutional cooperation
Rule-of-law infrastructure, including courthouses, police stations, and prisons
Sources: USAID, U.S. State Department.
Notes: All amounts are approximate.
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Table 2. Proposed Spending Plan for FY2013 Bilateral Assistance
Amount Purpose
Economic Support Fund
($370 million total)
$150 million
Direct budgetary assistance to Palestinian Authority (PA) in West Bank
$220 million
Assistance for the West Bank and Gaza (through USAID)
•
$22.5 million – governance, rule of law, civil society
•
$88 million – health, education, social services
•
$78.7 million – economic development
•
$30.8 million – humanitarian assistance
International Narcotics Control
and Law Enforcement
($70 million total)
$40.8 million
Training, non-lethal equipment, and garrisoning assistance to PA security
forces in the West Bank, supporting efforts by the U.S. Security Coordinator
$29.2 million
Assistance for PA Ministry of Interior and for the justice sector (prosecutors
and criminal investigators) to improve performance, efficiency, and inter-
institutional cooperation
Rule-of-law infrastructure, including courthouses, police stations, and prisons
Source: U.S. State Department, FY2013 Congressional Budget Justification for Foreign Operations (Annex:
Regional Perspectives).
Notes: All amounts are approximate.
Major Conditions, Limitations, and Restrictions on
Aid
Annual appropriations legislation routinely contains the following conditions, limitations, and
restrictions on U.S. aid to Palestinians:14
• Hamas and Terrorism: No aid is permitted for Hamas or Hamas-controlled
entities, and no aid may be made available for the purpose of recognizing or
otherwise honoring individuals who commit or have committed acts of terrorism.
• Power-Sharing PA Government: No aid is permitted for a power-sharing PA
government that includes Hamas as a member, or that results from an agreement
with Hamas and over which Hamas exercises “undue influence,” unless the
President certifies that the PA government, including all ministers, has accepted
the following two principles embodied in Section 620K of the Palestinian Anti-
Terrorism Act of 2006 (PATA), P.L. 109-446: (1) recognition of “the Jewish state
of Israel’s right to exist” and (2) acceptance of previous Israeli-Palestinian
14 Conditions, limitations, and restrictions for FY2013 are contained in the Consolidated Appropriations Act, 2012
(P.L. 112-74), §§7035-7040 and 7086, as extended by continuing resolution authority in P.L. 112-175.
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agreements (the “Section 620K principles”).15 If the PA government is “Hamas-
controlled,” PATA applies additional conditions, limitations, and restrictions on
aid. Under PATA, in the event that Hamas participation in a PA government
precludes ministries from receiving aid, the PA president and judiciary (if not
Hamas-controlled) may under certain conditions receive aid pursuant to a
presidential waiver for national security purposes.
It is unclear whether a consensus government of the type anticipated under recent
2011 and 2012 Fatah-Hamas agreements would come under the legal definition
of a “power-sharing PA government that includes Hamas as a member” or a
government over which Hamas exercises “undue influence.”16 It is also unclear
whether it would come under the legal definition of a “Hamas-controlled” PA
government, and thus trigger the additional conditions on U.S. aid cited above.
Under PATA, the Palestinian Legislative Council (PLC) is considered to be part
of the PA, but the legal consequences if the PLC were to reconvene with the
majority Hamas won in 2006 are still unclear.17
• PLO and Palestinian Broadcasting Corporation (PBC): No aid is permitted for
the PLO or for the PBC.
• Palestinian State: No aid is permitted for a future Palestinian state unless the
Secretary of State certifies that the governing entity of the state:
1. has demonstrated a firm commitment to peaceful coexistence with the State
of Israel;
2. is taking appropriate measures to counter terrorism and terrorist financing in
the West Bank and Gaza in cooperation with Israel and others; and
3. is working with other countries in the region to “vigorously pursue efforts to
establish a just, lasting, and comprehensive peace in the Middle East that will
enable Israel and an independent Palestinian state to exist within the context
of full and normal relationships.”18
This restriction does not apply to aid meant to reform the Palestinian governing
entity so that it might meet the three conditions outlined above. Additionally, the
President is permitted to waive this restriction for national security purposes.
• PA Personnel in Gaza: No aid is permitted for PA personnel located in Gaza.
Although the PA does pay salaries to individuals located in Gaza, USAID
maintains that U.S. direct budgetary assistance to the PA goes toward paying the
PA’s suppliers and commercial creditors (see “Direct Assistance to the Palestinian
Authority” below).
15 These principles have some similarity to the principles the so-called international Quartet (United States, European
Union, U.N. Secretary-General’s office, and Russia) has required Hamas to meet before accepting dealings with it: (1)
recognizing Israel’s right to exist, (2) renouncing violence, and (3) accepting previous Israeli-Palestinian agreements.
16 See footnote 92.
17 Although a Hamas-majority PLC could technically pass legislation controlling various functions of the PA
government, a document summarizing a May 16, 2011, 3D Security Initiative briefing for a congressional staff
audience stated that the PLC would not likely play an activist role—absent widespread consensus across factions—
given the interim nature of a potential power-sharing agreement as a placeholder anticipating PA presidential and
legislative elections.
18 P.L. 112-74, §7036(a)(2).
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• Palestinian Membership in the United Nations or U.N. Specialized Agencies: No
Economic Support Fund aid is permitted to the PA if the Palestinians obtain from
this point forward (the restriction does not apply to Palestinian membership in
UNESCO) “the same standing as member states or full membership as a state in
the United Nations or any specialized agency thereof outside an agreement
negotiated between Israel and the Palestinians.” The PLO did not obtain this
standing or membership pursuant to UNGA Resolution 67/19; thus the
resolution’s adoption did not trigger the aid restriction. The Secretary of State
may waive this restriction for national security reasons by filing a waiver
detailing how “the continuation of assistance would assist in furthering Middle
East peace.”19
• Vetting, Monitoring, and Evaluation: As discussed throughout this report, for
U.S. aid programs for the Palestinians, annual appropriations legislation routinely
requires executive branch reports and certifications, as well as internal and
Government Accountability Office (GAO) audits. These requirements are aimed
at preventing U.S. aid from benefitting Palestinian terrorists or abetting
corruption; at ensuring the amenability of Palestinian society and institutions to
aid programs; at assessing the programs’ effectiveness; and at monitoring
intervening variables (such as aid from international actors).20
Types of U.S. Bilateral Aid to the Palestinians
Table 3. U.S. Bilateral Assistance to the Palestinians, FY2005-FY2013
(regular and supplemental appropriations; current year $ in millions)
Account FY2005
FY2006
FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013a
ESF 224.4
148.5
50.0
389.5
776.0
400.4
395.7
395.7
370.0
P.L. 480
6.0 4.4 19.5
- 20.7
-
-
-
-
Title II
(Food Aid)
INCLEb -
-
-
25.0
184.0
100.0
150.0
100.0
70.0
Total 230.4
152.9
69.5
414.5
980.7
500.4
545.7
495.7
440.0
Sources: U.S. State Department, USAID.
Notes: All amounts are approximate; for purposes of this table and this report, “bilateral assistance” does not
include U.S. contributions to UNRWA or other international organizations from the Migration and Refugee
Assistance (MRA) or Emergency Refugee and Migration Assistance (ERMA) accounts, regardless of how the term
is defined in legislation.
19 P.L. 112-74, §7086(a).
20 P.L. 112-74, §§7039-7040. GAO audits are available on the following U.S. aid programs to the Palestinians: (1)
Economic Support Fund, including direct assistance to the PA and project assistance (audit for FY2008-FY2009
accessible at http://www.gao.gov/new.items/d10623r.pdf), (2) security assistance to the PA through the International
Narcotics Control and Law Enforcement account (http://www.gao.gov/new.items/d10505.pdf), and (3) contributions to
UNRWA through the Migration and Refugee Assistance and Emergency Refugee and Migration Assistance accounts
(http://www.gao.gov/new.items/d09622.pdf).
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a. Amounts stated for FY2013 have been requested but not yet appropriated, except for amounts made
available through a continuing resolution (P.L. 112-175) based on FY2012 levels.
b. INCLE stands for International Narcotics Control and Law Enforcement. INCLE figures do not include
$86.362 million of FY2006 ESF funds reprogrammed into the INCLE account by President Bush in January
2007 (see “Direct Assistance to the Palestinian Authority” below).
Economic Support Fund Project Assistance
Types of Funding Programs
Most aid to the Palestinians is appropriated through the ESF account and provided by USAID
(and, to a far lesser degree, the State Department)21 to non-governmental organizations (NGOs)
operating in the West Bank and the Gaza Strip. Funds are allocated in this program for projects in
sectors such as humanitarian assistance, economic development, democratic reform, improving
water access and other infrastructure, health care, education, and vocational training. Currently
most, if not all, funds for the Gaza Strip are dedicated to humanitarian assistance and economic
recovery needs.22 See Table 1 and Table 2 above for the Obama Administration’s proposed
spending plans for FY2012 and FY2013 ESF West Bank/Gaza assistance. In addition to bilateral
U.S. assistance to the Palestinians, Congress routinely appropriates around $10 million per year
through the ESF and Development Assistance accounts for a “New Generation in the Middle
East” initiative to “build understanding, tolerance, and mutual respect among the next generation
of Israeli and Palestinian leaders.”23
Vetting Requirements and Procedures
USAID subjects its programs worldwide to vetting requirements to ensure the proper use of funds
appropriated through its accounts. USAID’s West Bank and Gaza program is subject to a
specialized vetting process (for non-U.S. organizations) and to yearly audits intended to ensure
that funds are not diverted to Hamas or other organizations classified as terrorist groups by the
U.S. government.24 This vetting process has become more rigorous in recent years in response to
allegations that U.S. economic assistance was indirectly supporting Palestinian terrorist groups,
21 For example, see the State Department’s Middle East Partnership Initiative (MEPI) West Bank/Gaza website at
http://mepi.state.gov/med-region/west-bank-and-gaza.html.
22 For further detail on the types of projects funded, see Government Accountability Office, U.S. Assistance to the West
Bank and Gaza for Fiscal Years 2010 and 2012, GAO Foreign Assistance Report 12-81, July 13, 2012.
23 P.L. 112-74, §7062(f)(2).
24 P.L. 112-74, §7039(b) sets forth the legal requirements for vetting: “Prior to the obligation of funds appropriated by
this Act under the heading `Economic Support Fund' for assistance for the West Bank and Gaza, the Secretary of State
shall take all appropriate steps to ensure that such assistance is not provided to or through any individual, private or
government entity, or educational institution that the Secretary knows or has reason to believe advocates, plans,
sponsors, engages in, or has engaged in, terrorist activity nor, with respect to private entities or educational institutions,
those that have as a principal officer of the entity's governing board or governing board of trustees any individual that
has been determined to be involved in, or advocating terrorist activity or determined to be a member of a designated
foreign terrorist organization: Provided, That the Secretary of State shall, as appropriate, establish procedures
specifying the steps to be taken in carrying out this subsection and shall terminate assistance to any individual, entity,
or educational institution which the Secretary has determined to be involved in or advocating terrorist activity.”
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and following an internal audit in which USAID concluded it could not “reasonably ensure” that
its money would not wind up in terrorist hands.25
A February 2009 statement from USAID described its revamped vetting procedures as follows:
All NGOs applying for grants from USAID are required to certify, before award of the grant
will be made, that they do not provide material support to terrorists.... Before making an
award of either a contract or a grant to a local NGO, the USAID West Bank/Gaza Mission
checks the organization and its principal officers, directors and other key personnel against
lists maintained by the Office of Foreign Assets Control (OFAC) within the U.S. Department
of Treasury. The Mission also checks these organizations and individuals through law
enforcement and intelligence community systems accessed by USAID’s Office of Security.
At present, the Mission collects additional information up front in addition to the individual’s
full [four-part] name, such as a government issued photo-ID number and the individual’s
date and place of birth.... [USAID’s] West Bank/Gaza program possess[es] the most
comprehensive partner vetting system for foreign assistance throughout the U.S.
Government.26
A May 2009 GAO report found that USAID had strengthened its antiterrorism policies and
procedures in response to recommendations GAO had made in a 2006 report.27
Direct Assistance to the Palestinian Authority
Budgetary assistance is a major part of the U.S. strategy to support the PA in the West Bank,
although some Members of Congress expect better governance and a more proactive approach by
the PA toward peace with Israel in return.28 According to annual foreign operations appropriations
laws, congressionally approved funds for the West Bank and Gaza Strip cannot be given directly
to the PA unless the President submits a waiver to Congress stating that doing so is in the interest
of national security, and the Secretary of State certifies that there is a single PA treasury account,
civil service roster, and payroll.29 Annual appropriations legislation also routinely places
25 “Audit: Terrorists Got U.S. Aid; Agency’s Screening Called Inadequate,” Chicago Tribune, November 16, 2007;
Testimony of Henrietta Fore, then USAID Administrator and Director of U.S. Foreign Assistance, House
Appropriations Subcommittee on State, Foreign Operations, and Related Programs Holds Hearing on the Fiscal 2009
Budget for the U.S. Agency for International Development, February 27, 2008.
26 Statement issued by USAID to CRS on February 5, 2009. USAID does not subject U.S. organizations to vetting due
to U.S. privacy law concerns. See GAO, Measures to Prevent Inadvertent Payments to Terrorists Under Palestinian
Aid Programs Have Been Strengthened, but Some Weaknesses Remain, GAO Foreign Assistance Report 09-622, May
2009.
27 See GAO, Measures to Prevent Inadvertent Payments to Terrorists…, op. cit. A schematic detailing USAID’s
vetting process is found on page 42 of the report. GAO did recommend in the report that USAID take steps to ensure
that it and its primary contractors use the same rigor at the subcontractor level that they employed in requiring
antiterrorism clauses and certifications during their contracting process.
28 Ileana Ros-Lehtinen, Chairman of the House Foreign Affairs Committee’s Subcommittee on the Middle East and
North Africa, voiced significant concern over the Administration’s provision of direct budgetary assistance to the PA
when serving as ranking Member of the full committee in November 2010: “It is deeply disturbing that the
Administration is continuing to bail out the Palestinian leadership when they continue to fail to meet their
commitments, under international agreements and requirements outlined in U.S. law, including dismantling the
Palestinian terrorist infrastructure, combating corruption, stopping anti-Israel and anti-Semitic incitement, and
recognizing Israel’s right to exist as a Jewish state.” House Foreign Affairs Committee website: “Ros-Lehtinen
Opposes Latest U.S. ‘Bailout’ Installment for Palestinian Authority,” November 11, 2010.
29 See P.L. 112-74, §7040 (“Limitation on Assistance for the Palestinian Authority”). In the event of a presidential
waiver, §7040 requires the President to submit a report to the Committees on Appropriations “detailing the justification
(continued...)
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conditions on aid to any power-sharing PA government “of which Hamas is a member,” and the
FY2012 bill extended these conditions to any PA government that results from an agreement with
Hamas over which Hamas has “undue influence” (for further discussion, see “Hamas and a
“Unity Government”?” below). Even after money is transferred to the PA’s treasury account, the
United States retains prior approval of any transactions from that account, along with a three-year
power of audit and right of refund over those funds.30
During the final year of President George W. Bush’s Administration, President Bush issued
waivers providing $300 million in direct budgetary assistance to the PA. President Barack Obama
has followed the precedent Bush established by authorizing a total of $750 million in direct
budgetary assistance, as follows:
• In July 2009, $200 million in ESF money were transferred to the PA in the wake
of a presidential waiver issued by President Obama.31
• In November 2009, $75 million in budgetary assistance were provided to the PA
under the July presidential waiver as an advance on FY2010 ESF funds, pursuant
to a continuing resolution (later appropriated pursuant to P.L. 111-117).
• In April 2010, another $75 million in budgetary assistance from the ESF account
were provided to the PA via presidential waiver.32
• In November 2010, $150 million in budgetary assistance were provided to the PA
via presidential waiver as an advance on FY2011 ESF funds, pursuant to the
Continuing Appropriations Act, 2011 (P.L. 111-242).33
• In August 2011, $50 million in budgetary assistance from the ESF account were
provided via presidential waiver.34
• In April 2012, the Administration notified Congress of its intention to obligate an
additional $200 million in budgetary assistance from the ESF account,
accompanied by a presidential waiver.35 This amount appears to be subject to an
ongoing informal congressional hold, as mentioned above.36
Direct U.S. budgetary assistance to the PA goes toward paying off its commercial debt, as the
following FY2012 USAID congressional notification language says:
Direct budget support will be used in the same manner as previous transfers—to service debt
to commercial suppliers and commercial banks. Debt to commercial banks will be debt
(...continued)
for the waiver, the purposes for which the funds will be spent, and the accounting procedures in place to ensure that the
funds are properly disbursed: Provided, That the report shall also detail the steps the Palestinian Authority has taken to
arrest terrorists, confiscate weapons and dismantle the terrorist infrastructure.”
30 USAID FY2012 Congressional Notification #47, April 27, 2012.
31 Presidential Determination No. 2009-23.
32 Presidential Memorandum 2010-06.
33 Presidential Determination 2011-1.
34 USAID FY2011 Congressional Notification #133, August 18, 2011; Presidential Determination 2011-14, August 30,
2011.
35 USAID FY2012 Congressional Notification #47, April 27, 2012; Presidential Memorandum, April 25, 2012.
36 See footnote 10.
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originally incurred for purchases from commercial suppliers. Each of the payees will have
been vetted in accordance with USAID West Bank and Gaza existing procedures, as
applicable, as a precondition to the transfer of funds by the PA for such payments. Funds
may also be used to pay for upcoming purchases from commercial suppliers or
reimbursements of recent purchases from suppliers.37
Despite this explanation of U.S. budgetary assistance to the PA, some commentators allege that
U.S. funding indirectly supports PA salaries, including those supposedly paid to some Palestinians
who are imprisoned by Israel on terrorism charges.38
U.S. Security Assistance to the Palestinian Authority
As mentioned above, aid has been given to train, reform, advise, house, and provide non-lethal
equipment for PA civil security forces in the West Bank loyal to President Abbas. This aid is
aimed at countering militants from organizations such as Hamas and Palestinian Islamic Jihad,
and establishing the rule of law for an expected Palestinian state. An increasing proportion of this
training and infrastructure assistance has been provided to strengthen and reform the PA criminal
justice sector (see Table 1 and Table 2 above). This assistance has come from the INCLE
account—to which a total of approximately $645 million has been appropriated or reprogrammed
for use in the West Bank since 2007. The Obama Administration has requested an additional $70
million in FY2013 INCLE funding.
Since Hamas gained control of the Gaza Strip, the office of the U.S. Security Coordinator (USSC)
for Israel and the Palestinian Authority (a three-star U.S. general/flag officer, supported as of mid-
2012 by U.S. and allied staff and military officers from the United Kingdom, Canada, and seven
other countries) has worked in coordination with the State Department’s Bureau of International
Narcotics and Law Enforcement Affairs (INL) to sponsor and oversee training for PA security
forces personnel, many of whom have been newly recruited. To date, nine full PA National
Security Forces (NSF)39 special battalions (4,987 personnel) and two Presidential Guard (PG)40
battalions (1,078 personnel) have been trained at the Jordan International Police Training Center
(JIPTC).41 Additionally, approximately 613 members of the PA Civil Defense (firefighters and
other emergency responders) have been trained in Amman at the Jordanian Academy of Civil
Protection.42
37 USAID FY2012 Congressional Notification #47, April 27, 2012.
38 See, e.g., Herb Keinon, “‘U.S. paying salaries for jailed Palestinian terrorists,’” jpost.com, July 26, 2011.
39 The NSF (with approximately 8,000 active personnel), the organization that receives the greatest amount of training
and other resources as a result of U.S. INCLE assistance, is considered by many Palestinians to be analogous to a
national army—housed in barracks, classified by military rank, and subject to a military-style command structure.
40 The PG’s main purposes are to protect the PA president and other VIPs, to respond to crises, and to protect official
PA facilities.
41 Neither NSF nor PG personnel possess the legal authority to make arrests when tasked with law and order missions.
Therefore, they generally operate as strategic reinforcements and force protection for the organizations empowered to
make arrests—the Palestinian Civil Police (PCP, with approximately 7,200 active personnel) and two intelligence
organizations (the Preventive Security Organization and the General Intelligence Service) which are less visible than
the PCP and NSF in day-to-day law and order tasks.
42 The information in this paragraph on PA security forces training in Jordan was provided to CRS on January 14, 2013,
by a senior Western official based in the region.
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Now that the initial training of newly-formed battalions has reportedly been completed, the
USSC/INL program appears to be changing its emphasis. At a July 12, 2011, hearing before the
House Foreign Affairs Subcommittee on the Middle East and South Asia, Lieutenant General
Michael Moeller, the previous USSC,43 outlined some of these changes in the context of
expectations for FY2012:
This year, we will transition the program into the next phase of our campaign plan: Building
institutional capacity. This new phase is less resource intensive as we move away from
primarily providing the Palestinian security forces with equipment and infrastructure toward
an increasingly direct “advise and assist” role.
In this phase, we will help the PASF develop indigenous readiness, training, and logistics
programs and the capability to maintain/sustain their force structure readiness and
infrastructure. Additionally, the USSC will continue to support other US rule of law
programs that assist the Palestinians to improve the performance of the Justice and
Corrections Sectors.44
The USSC/INL security assistance program exists alongside other assistance and training
programs provided to Palestinian security forces and intelligence organizations by various other
countries and the European Union (EU).45 Some reports cite the probable existence of covert U.S.
assistance programs as well.46 By most accounts, the PA forces receiving training have shown
increased professionalism and have helped substantially improve law and order and lower the
profile of terrorist organizations in West Bank cities.47 Israeli officials generally support the
USSC/INL program, routinely citing both the PA forces’ greater effectiveness as well as increased
and sustained levels of Israel-PA security cooperation in the West Bank since the program began.
This cooperation, however, renders the PA vulnerable to criticism from Hamas and others seeking
to undermine the PA’s popular credibility as a champion of Palestinian national aspirations.48
Additionally, the aspiration to coordinate international security assistance efforts and to
consolidate the various PA security forces under unified civilian control that is accountable to rule
of law and to human rights norms remains largely unfulfilled. PA forces have come under
criticism for the political targeting of Hamas—in collaboration with Israel and the United
States—through massive shutdowns and forced leadership changes to West Bank charities with
alleged ties to Hamas members and through reportedly arbitrary detentions of Hamas members
43 Vice Admiral Paul Bushong has served as USSC since October 2012.
44 Testimony of Lt. Gen. Moeller before the House Foreign Affairs Subcommittee on the Middle East and South Asia,
July 12, 2011.
45 In January 2006, the EU Coordinating Office for Palestinian Police Support (EUPOL COPPS) was launched to help
train and equip the Palestinian Civil Police. EUPOL COPPS also advises the PA on criminal justice and rule of law
issues. EUPOL COPPS has 70 international staff and 40 local hires in the West Bank, and an annual operating budget
of almost €5 million. See http://eupolcopps.eu.
46 See, e.g., Yezid Sayigh, Policing the People, Building the State: Authoritarian Transformation in the West Bank and
Gaza, Carnegie Endowment for International Peace, February 2011; Ian Cobain, “CIA working with Palestinian
security agents,” guardian.co.uk, December 17, 2009.
47 Improvements in the PA security forces’ leadership and capacity may factor into Israeli data that—according to
information a senior Western official based in the region provided to CRS on June 12, 2012—cite a 96% decrease in
West Bank terrorist attacks since 2007. Other factors contributing to the decline in terrorism may include enhanced
Israeli security measures, Palestinian fatigue with or decreasing appetite for politically-motivated violence or popular
resistance, and various political and economic incentives and other developments.
48 Gabe Kahn, “Hamas: PA-Israel Security Cooperation Blocking Unity Deal,” IsraelNationalNews.com, March 9,
2012.
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and supporters.49 More recently, some observers are questioning how successful the PA has been
in bringing law and order to Jenin and other parts of the northern West Bank that were previously
held out as examples of PA security progress and possible models for other West Bank areas.
Some PA security personnel, including a few trained with U.S. funding50 and some who had been
granted amnesty from previous involvement with terrorist groups, have reportedly been involved
in the criminal activity that led to a renewed PA crackdown in the area. One report asserted that
despite these incidents, general security in Jenin remains much improved since 2007,51 and many
reports document ongoing efforts by the PA to confront crime and security personnel corruption.
According to PA Prime Minister Salam Fayyad, “What’s going on now is patching the gaps (in
the security establishment) through a focused security effort.”52
Some Palestinians and outside observers assert that the effectiveness and credibility of PA
operations are undermined by Israeli restrictions—including curfews, checkpoints, no-go zones,
and limitations on international arms and equipment transfers—as well as by Israel’s own security
operations in the West Bank53 and at crossings into Gaza. Israel claims that its continuing
operations in the West Bank are necessary in order to reduce the threat of terrorism. It is unclear
how concerns about the effectiveness of the PA security forces might evolve if anti-Israel protests
and occasional instances of Israeli-Palestinian confrontation in the West Bank increase in
frequency and intensity amid heightened tension. According to one observer:
In the last couple of months, and especially since Israel’s intervention in Gaza and
November’s UN vote on Palestine, a cascade of direct confrontations between Israeli forces
and Palestinians have erupted throughout the West Bank.54
This might in part be motivated by a continued stalemate in negotiating efforts, PA budgetary
problems exacerbated by Israel’s unwillingness to transfer tax and customs revenue,55 and new
Israeli announcements of residential construction and planning in West Bank settlements and in
East Jerusalem.56
How potential Fatah-Hamas consensus on a PA governing arrangement may affect the activities
of PA security forces in the West Bank is unclear, although it is possible that these activities will
remain largely unchanged until either PA presidential and legislative elections can be held or
Fatah and Hamas can agree on security coordination for both the West Bank and Gaza. The
likelihood of either contingency occurring is seriously questioned by many observers.
49 See, e.g., Nathan Thrall, “Our Man in Palestine,” New York Review of Books, October 14, 2010.
50 Karin Brulliard, “Drama in West Bank city of Jenin shows cracks in Palestinian nation-building project,” Washington
Post, May 25, 2012.
51 Ibid.
52 Ali Sawafta and Noah Browning, “Palestinian Authority cracks down in West Bank town,” Reuters, June 4, 2012.
53 These operations underscore the fact that the Israeli-Palestinian agreements that authorized the creation of Palestinian
security forces in the 1990s in areas of limited Palestinian self-rule contained clauses that preserved Israel’s prerogative
to conduct operations in those areas for purposes of its own security.
54 Geoffrey Aronson, “Israeli-Palestinian Security Ties Fail as They Succeed for PA,” Al-Monitor, January 4, 2013.
55 See footnote 90.
56 Many Israelis who support the extension of Israeli civil law over East Jerusalem—which took place in 1967—refer to
Jewish residential areas there as “neighborhoods”, seeking to distinguish these areas from Jewish settlements in the
West Bank, which remains under Israeli military jurisdiction. Successive U.S. Administrations and most other
international actors do not draw this distinction. For more information, see CRS Report RL33476, Israel: Background
and U.S. Relations, by Jim Zanotti.
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U.S. Contributions to UNRWA
Overview
The United States is the largest single-state donor to UNRWA, which provides food, shelter,
medical care, and education for many of the original refugees from the 1948 Arab-Israeli war and
their descendants—now comprising approximately 5 million Palestinians in Jordan, Syria,
Lebanon, the West Bank, and Gaza. U.S. contributions to UNRWA—separate from U.S. bilateral
aid to the West Bank and Gaza—come from the Migration and Refugee Assistance (MRA)
account and the Emergency Refugee and Migration Assistance (ERMA) account. Since
UNRWA’s inception in 1950, the United States has provided the agency with approximately $4.4
billion in contributions (see Table 4 below). Other refugees worldwide fall under the mandate of
the U.N. High Commissioner for Refugees (UNHCR).
The budget for UNRWA’s core activities (general fund) for 2013 is $657 million, funded mainly
by Western governments, international organizations, and private donors.57 In December 2012,
UNRWA Deputy Commissioner-General Margot Ellis forecast a $69 million funding shortfall for
2013,58 which would necessitate some combination of additional contributions and program cuts.
UNRWA also creates special emergency funds for pressing humanitarian needs. U.S.
contributions (which are made from the Migration and Refugee Assistance (MRA) and
Emergency Refugee and Migration Assistance (ERMA) accounts managed by the State
Department’s Bureau of Population, Refugees, and Migration (PRM)) totaled $233.3 million for
FY2012 ($125.4 million for the general fund, $103.8 million for emergency funds and special
projects). According to PRM, $100 million in FY2013 contributions have been disbursed as of
December 2012 ($60 million for the general fund, $40 million for emergency funds).59
Table 4. Historical U.S. Government Contributions to UNRWA
(in $ millions)
Fiscal Year(s)
Amount
Fiscal Year(s)
Amount
1950-1989 1,473.3
2001
123.0
1990 57.0 2002 119.3
1991 75.6 2003 134.0
1992 69.0 2004 127.4
1993 73.8 2005 108.0
1994 78.2 2006 137.0
1995 74.8 2007 154.2
57 According to statistics from UNRWA’s website, U.S. contributions in 2011 constituted approximately 23% of the
UNRWA General Fund budget and 25% of the total budget. Aggregate contributions from the European Commission
and European states (including both EU members and non-members) and regions constituted approximately 51% of the
total budget. Aggregate contributions from the Muslim world constituted approximately 15% of the total budget.
58 Transcript of remarks by UNRWA Deputy Commissioner-General Margot Ellis at 2013 Pledging Conference,
United Nations, New York, December 4, 2012, available at http://www.unrwa.org/etemplate.php?id=1550.
59 CRS email correspondence with State Department official, December 4, 2012.
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Fiscal Year(s)
Amount
Fiscal Year(s)
Amount
1996 77.0 2008 184.7
1997 79.2 2009 268.0
1998 78.3 2010 237.8
1999 80.5 2011 249.4
2000 89.0 2012 233.3
TOTAL 4,381.8
Source: U.S. State Department.
Notes: All amounts are approximate.
Until the 1990s, Arab governments refrained from contributing to UNRWA’s budget in an effort
to keep the Palestinian refugee issue on the international agenda and to press Israel to accept
responsibility for their plight. Since then, several Arab states have made relatively modest annual
contributions.
In Gaza, most observers acknowledge that the role of UNRWA in providing basic services (i.e.,
food, health care, education) takes much of the governing burden off Hamas. As a result, some
complain that this amounts to UNRWA’s enabling of Hamas and argue that its activities should be
discontinued or scaled back. This is in addition to critics who question UNRWA’s existence
because they believe it perpetuates Palestinian dependency and resentment against Israel.60
However, many others, U.S. and Israeli officials included, believe that UNRWA plays a valuable
role by providing stability and serving as the eyes and ears of the international community in
Gaza. They generally prefer UNRWA to the uncertain alternative that might emerge if UNRWA
were removed from the picture.61
Civil conflict in Syria affects the approximately 500,000 Palestinian refugees there. Some have
fled to Lebanon, Jordan, and even Gaza,62 and some others have reportedly taken part in the
conflict or incurred death, injury, displacement, or other forms of harm, such as when the
Yarmouk refugee camp in greater Damascus became a locus of fighting between regime forces
and rebels in December 2012.63 Future events could exacerbate the dilemma of these refugees and
increase UNRWA needs assessments.
60 See, e.g., Michael S. Bernstam, “The Palestinian Proletariat,” Commentary, December 2010.
61 See FY2013 Congressional Budget Justification for Foreign Operations, Department of State (Volume 2), pp. 105-
106: “USG support for UNRWA directly contributes to the U.S. strategic interest of meeting the humanitarian needs of
Palestinians, while promoting their self-sufficiency. UNRWA plays a stabilizing role in the Middle East through its
assistance programs, serving as an important counterweight to extremist elements. Given UNRWA’s unique
humanitarian role in areas where terrorist organizations are active, the State Department continues to monitor closely
UNRWA’s obligations to take all possible measures to ensure that terrorists do not benefit from USG funding.”
62 Mohammed Suliman, “Palestinian Refugees From Syria Seek Refuge in Gaza,” Al-Monitor Palestine Pulse, January
17, 2013.
63 Nicolas Pelham, “Jordan’s Syria Problem,” New York Review of Books Blog, January 10, 2013.
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Issues for Congress
Some observers, including a former general counsel for UNRWA, have criticized UNRWA for,
among other things, insufficient or flawed vetting procedures and engaging in political
advocacy.64 UNRWA and its supporters, however, maintain that UNRWA officials are fulfilling
their mandated roles as well as can be expected under challenging circumstances (i.e., UNRWA’s
lack of a robust policing capability and other operational limitations, political pressures, and
security concerns).65
In testimony before the House Appropriations Subcommittee on State, Foreign Operations and
Related Programs on April 23, 2009, Secretary of State Hillary Rodham Clinton spoke for the
Obama Administration regarding U.S. oversight of contributions to UNRWA:
We have made it clear to UNRWA, the United Nations Relief And Works Agency, that we
intend to carefully track any aid that they receive. They have taken additional steps, partly at
our urging, to make their process more transparent, consistent with both United Nations
commitments and U.S. legislation. They conduct background checks on employees. They
share staff lists with us and with Israel. They prohibit staff participation in political activities.
They launch investigations upon receiving information from Israel, us, or anyone else about
any staff member engaging in inappropriate or illicit activities. They are actually
investigating staff members right now who were elected in internal elections within Gaza.
And we have pressed them very hard because they have to earn our confidence in this.66
Vetting of UNRWA Contributions
The primary concern raised by some Members of Congress is that U.S. contributions to UNRWA
might be used to support terrorists. Section 301(c) of the 1961 Foreign Assistance Act (P.L. 87-
195), as amended, says that “No contributions by the United States shall be made to [UNRWA]
except on the condition that [UNRWA] take[s] all possible measures to assure that no part of the
United States contribution shall be used to furnish assistance to any refugee who is receiving
military training as a member of the so-called Palestine Liberation Army or any other guerrilla
type organization or who has engaged in any act of terrorism.”
A May 2009 GAO report said that, since a previous GAO report in 2003, UNRWA and the State
Department had strengthened their policies and procedures to conform with Section 301(c) legal
requirements, but that “weaknesses remain.”67 Neither report found UNRWA to be in
noncompliance with Section 301(c), and to date, no arm of the U.S. government has made such a
finding. The following are some points from the 2009 report and subsequent developments
related to it:
64 See James G. Lindsay, Fixing UNRWA: Repairing the UN’s Troubled System of Aid to Palestinian Refugees,
Washington Institute of Near East Policy, Policy Focus #91, January 2009. See also James Phillips, “The Gaza Aid
Package: Time to Rethink U.S. Foreign Assistance to the Palestinians,” The Heritage Foundation WebMemo No. 2333,
March 9, 2009.
65 A direct written rebuttal by Israeli academic Maya Rosenfeld to the former UNRWA general counsel’s claims was
carried by UNRWA’s website and is available at http://rete-eco.it/attachments/
5172_Rejoinder%20to%20Lindsay_jan09.pdf.
66 Transcript of remarks by Secretary of State Hillary Rodham Clinton, House Appropriations Subcommittee on State,
Foreign Operations and Related Programs Hearing, April 23, 2009.
67 GAO, Measures to Prevent Inadvertent Payments to Terrorists…, op. cit.
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• In the 2009 GAO report, State officials said compliance is evaluated based on
State’s “internal level of confidence that UNRWA has taken all possible measures
to ensure that terrorists are not receiving assistance, such as having procedures in
place and taking measures to respond to issues that arise.”68 State has not defined
the term “all possible measures,” nor has it defined what would constitute
noncompliance with Section 301(c).
• The report said that State had not established written criteria to use in evaluating
UNRWA’s compliance with Section 301(c), and recommended that State consider
doing so.69 In November 2009, State and UNRWA signed a non-binding
“Framework for Cooperation” for 2010. The document agreed that, along with
the compliance reports UNRWA submits to State biannually, State would use 15
enumerated criteria “as a way to evaluate” UNRWA’s compliance with Section
301(c). State has signed a similar document with UNRWA in each subsequent
year.70
• UNRWA said that it screens its staff and contractors every six months and that it
screened all Palestinian refugees and microfinance clients in December 2008 for
terrorist ties to Al Qaeda and the Taliban, pursuant to a list established pursuant
to U.N. Security Council Resolution 1267.71 According to the State Department,
UNRWA has subsequently screened all of the above groups roughly every six
months.72 UNRWA said that it is unable to screen those of its beneficiaries who
are displaced persons from the 1967 war because it does not collect information
on those persons.73
• UNRWA’s UN 1267 terrorist screening list does not include Hamas, Hezbollah,
or most other militant groups that operate in UNRWA’s surroundings. UNRWA is
unwilling to screen its contractors and funding recipients against a list supplied
by only one U.N. member state. Nevertheless, UNRWA officials did say that if
notified by U.S. officials of potential matches, they would “use the information
as a trigger to conduct their own investigation,” which led to the report’s
recommendation that the State Department consider screening UNRWA
contractors.74 In response, State says that it now screens quarterly, against the
Excluded Parties Lists System (EPLS, which is a list of parties excluded
throughout the U.S. government from receiving federal contracts75),
68 Ibid.
69 Ibid.
70 “Framework for Cooperation Between UNRWA and the Government of the United States of America for 2013,”
available at http://www.state.gov/documents/organization/201638.pdf. The 15 enumerated criteria are found in Annex
1 of the framework document.
71 GAO, Measures to Prevent Inadvertent Payments to Terrorists…, op. cit.
72 CRS correspondence with State Department official, June 20, 2012.
73 GAO, Measures to Prevent Inadvertent Payments to Terrorists…, op. cit. In 2006, an organization that advocates for
Palestinian refugees estimated the total number of 1967 displaced persons to be between 800,000 and 850,000. See
BADIL Resource Center for Palestinian Residency & Refugee Rights, Survey of Palestinian Refugees and Internally
Displaced Persons 2004-2005, May 2006.
74 GAO, Measures to Prevent Inadvertent Payments to Terrorists…, op. cit.
75 U.S. General Services Administration website at https://www.acquisition.gov/faqs_whatis.asp.
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the names of vendors of contracts equal to or exceeding $100,000, as
provided by UNRWA. Each contract awardee is screened twice by separate
State/PRM staff. The most recent analysis was conducted for the third quarter
of 2012 (July-September 2012). Since the EPLS screening by State/PRM
began in 2009, the analysis has resulted in no matches against the EPLS.76
• UNRWA has established procedures to investigate inappropriate staff behavior.
UNRWA [said] that it seeks information from authorities whenever staff are
detained, convicted, or refused a permit or targeted by Israeli military forces.
UNRWA officials said they share the names of all UNRWA staff annually with
the governments of Egypt, Israel, Jordan, Lebanon, Syria, and the Palestinian
Authority but have received no information on staff members from these
governments.77
• UNRWA officials said that UNRWA provides assistance “in the context of its
humanitarian mandate, meaning that agency policy is generally not to deny
education or primary healthcare benefits.” The officials said that if a refugee was
denied benefits because of suspected militant or terrorist activities or ties, his or
her child “would not be disqualified from attending an UNRWA school.”78
Legislation
Critiques of UNRWA’s operations are routinely raised, and some Members of Congress have
supported legislation or resolutions aimed at increasing oversight of the agency, strengthening its
vetting procedures, and/or capping U.S. contributions.79 In S.Rept. 112-172, which accompanies
the version of the Department of State, Foreign Operations, and Related Programs Appropriations
Act, 2013 (S. 3241) that the Senate Appropriations Committee reported favorably on May 24,
2012, the committee included a provision that would require the Secretary of State to submit a
report within one year of the act’s enactment with the following information:
(a) the approximate number of people who, in the past year, have received UNRWA
services—(1) whose place of residence was Palestine between June 1946 and May 1948 and
who were displaced as a result of the 1948 Arab-Israeli conflict; and (2) who are descendants
of persons described in subparagraph (1);
(b) the extent to which the provision of such services to such persons furthers the security
interests of the United States and of other United States allies in the Middle East; and
76 CRS email correspondence with State Department official, December 4, 2012.
77 GAO, Measures to Prevent Inadvertent Payments to Terrorists…, op. cit.
78 Ibid.
79 H.Rept. 111-151 (the joint explanatory statement accompanying the Consolidated Appropriations Act, 2010, P.L.
111-32) contained a provision requiring a report from the Secretary of State to the Committees on Appropriations no
later than 45 days following the enactment of P.L. 111-32 on various UNRWA self-policing and transparency-
promoting activities, including measures UNRWA takes to comply with Section 301(c) of the 1961 Foreign Assistance
Act relating to preventing assistance to terrorists, and measures it takes to reduce anti-Israel incitement and education.
P.L. 112-74 incorporated the same reporting requirement by reference to H.Rept. 111-151. Pursuant to the version of
H.R. 5857 (Department of State, Foreign Operations, and Related Programs Appropriations Act, 2013) reported
favorably by the House Appropriations Committee, no U.S. contributions to UNRWA would be permitted unless and
until the Secretary of State reports that UNRWA is following through on the self-policing and transparency-promoting
activities discussed above.
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(c) the methodology and challenges in preparing such report.
Senator Patrick Leahy, chairman of the Senate Appropriations Subcommittee on State, Foreign
Operations, and Related Programs, reportedly authored the above language for S.Rept. 112-172
as an alternative to a more detailed reporting requirement proposed by Senator Mark Kirk.80 In a
May 25, 2012, press release, Senator Kirk’s office asserted that the reporting requirement is
intended to “help taxpayers better understand whether UNRWA truly remains a refugee assistance
organization or has become a welfare agency for low-income residents of the Levant.” A critic of
the provision wrote that its “real goal” is to “redefine the number of Palestinian refugees
receiving aid from UNRWA with a view to limiting its budget, which is heavily dependent on
U.S. aid.”81 Palestinians’ claim of a “right of return” for many in their diaspora to their places of
origin in present-day Israel—one of the core issues to be resolved in the Israeli-Palestinian
conflict—could be substantially affected by a recharacterization of Palestinian refugees or a
change in their aid levels.
Supporters of the Kirk reporting requirement assert that UNRWA, by providing services to
descendants of the original Palestinian refugees from 1948—by one count, the number of
registered refugees has increased seven-fold since then—has effectively become “a silent partner
to the Palestinian leadership” in perpetuating the refugee issue.82 A counterargument holds that
UNRWA defines refugee status and eligibility for its services using a standard recognized and
practiced by the U.N. High Commissioner for Refugees (UNHCR) around the world.83 This
counterargument is, in turn, brought into question by other sources.84
Such opposing views highlight a broader debate over responsibility for the multi-generational
Israeli-Palestinian conflict and whether attempts to resolve the refugee problem separately are
advisable and more likely either to lead to or work against an overall resolution that addresses
both parties’ interests.85 Deputy Secretary of State Thomas Nides used the following language in a
letter dated May 24, 2012, urging Chairman Leahy to oppose the Kirk reporting requirement:
The status of Palestinian refugees is one of the most sensitive final status issues confronting
Israel and the Palestinians; it strikes a deep, emotional, [sic] chord among Palestinians and
their supporters, including our regional allies. Indeed, the refugee issue is not confined to the
Palestinian territories; it also directly and significantly impacts the politics and stability of
allies, such as Jordan and Lebanon, which host large Palestinian refugee populations.
80 Josh Rogin, “Senate fight today over Palestinian ‘refugees,’” thecable.foreignpolicy.com, May 24, 2012.
81 Victor Kattan, “‘UNRWA reform’ effort will harm Middle East peace effort,” thehill.com, May 30, 2012.
Reportedly, the original version of Senator Kirk’s reporting requirement would have defined a Palestinian refugee for
purposes of U.S. policy towards UNRWA “as a person whose place of residence was Palestine between June 1946 and
May 1948, who was personally displaced as a result of the 1948 or 1967 Arab-Israeli conflicts, who currently does not
reside in the West Bank or Gaza and who is not a citizen of any other state.” Rogin, op. cit.
82 Jonathan Schanzer, “Status Update,” foreignpolicy.com, May 21, 2012.
83 Kattan, op. cit.
84 Josh Rogin, “Senate fight today over Palestinian ‘refugees,’” thecable.foreignpolicy.com, May 24, 2012: “UNRWA
has been using a definition that includes descendants of refugees while other U.N. bodies do not include descendants in
their definition.” See also Jennifer Rubin, “Is the U.N. making the Palestinian refugee problem worse?”,
washingtonpost.com, May 23, 2012.
85 See, e.g., Hilary Leila Krieger, “Palestinians: US refugee bill may delay peace,” jpost.com, June 5, 2012; Leila Hilal,
“Israeli Leader Wrongly Blames UN and Arab States for Palestinian Refugees,” theatlantic.com, February 21, 2012;
“Leila Hilal’s bizarre defense of UNRWA,” jpost.com (Warped Mirror Blog), June 7, 2012.
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This proposed amendment would be viewed around the world as the United States acting to
prejudge and determine the outcome of this sensitive issue. United States policy has been
consistent for decades, in both Republican and Democratic administrations—final status
issues can and must only be resolved between Israelis and Palestinians in direct negotiations.
The Department of State cannot support legislation which would force the United States to
make a public judgment on the number and status of Palestinian refugees.86
Additionally, the joint explanatory statement to P.L. 112-74 (H.Rept. 112-331) endorsed language
in S.Rept. 112-85 (accompanying S. 1601) directing GAO to assess
(1) the ability of the Palestinian Authority to assume responsibility for any of the programs
and activities conducted by the U.N. Relief and Works Agency in the West Bank; (2) actions
required by the Palestinian Authority in order to assume such responsibility; and (3) the
opinion of the Department of State and relevant ministries of the Government of Israel,
including the Ministry of Defense, on the viability of transitioning such programs and
activities from UNRWA to the Palestinian Authority.
Issues for Congress in Determining Future Aid
Possible Additional Palestinian Action in International Forums
Additional recourse by the PLO to international forums, either to seek greater recognition of
Palestinian statehood, or to directly or indirectly pursue censure of or legal measures against
Israel for past and ongoing activities regarding the West Bank and Gaza, could lead to greater
resistance to or scrutiny of U.S. aid to Palestinians. Past international action is discussed above
(see “Palestinian U.N.-Related Initiatives and Possible Fatah-Hamas Consensus—Effects on
Aid”).
One possible reason that some Members of Congress have shown reluctance to continue funding
the PA in light of Palestinian action within the U.N. system is a possible perception of these
Palestinian initiatives as an attempt to undermine the U.S. role as “honest broker” and guarantor
of the peace process. U.S. lawmakers and officials also may view Palestinian action in
international forums as a sign that U.S. attempts to use aid for political leverage with the
Palestinians are unproductive.
Following the adoption of UNGA Resolution 67/19, some Members of Congress proposed
legislation87 or sought Obama Administration action88 seeking to close the PLO’s representative
86 Text of Deputy Secretary Nides’s letter available at http://www.scribd.com/doc/94703915/DepSec-State-Opposes-
Kirk-Amdt#download.
87 Three amendments (S.Amdt. 3139, S.Amdt. 3171, and S.Amdt. 3203) responding to UNGA Resolution 67/19 were
proposed to S. 3254 (the National Defense Authorization Act, 2013) prior to its passage in December 2012. None of the
amendments were voted on.
88 In December 2012, the then-current and -prospective chairs and ranking Members of the House Foreign Affairs
Committee sponsored a letter to President Obama calling on him to close the PLO’s representative office in
Washington, DC. The text of the letter that was signed by more than 235 Members of Congress is available at
http://www.scribd.com/doc/117655331/Letter-to-President-Obama-A-Majority-of-Members-of-Congress-Sign-Ros-
Lehtinen-Letter-Urging-Consequences-for-Palestinians-UN-over-Unilateral-
Stat?secret_password=scbcbqtlem1ftdesloz.
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office in Washington, DC, or to make any future ICC action targeting Israel a trigger that would
cut off U.S. aid to the PA. One source quoted Senator Lindsey Graham, co-sponsor of one of the
legislative proposals, as saying, “I do not mind helping the Palestinian people, who have many
challenges, get a good economy and rule of law, a nation established on the West Bank. But I
cannot, along with my colleagues, in good conscience send a billion dollars to an organization
who is trying to use the political tool of the United Nations and the International Criminal Court
to undermine [the peace process].”89
However, U.S. lawmakers and policymakers may be reluctant to take drastic or permanent
measures in reprisal for Palestinian action in international forums, or to encourage the
continuation or intensification of reprisals that Israel has made since the adoption of Resolution
67/19.90 This could be due to
• desires not to further undercut a possible return to diplomacy;
• concerns regarding the PA’s financial fragility and the disorder that could result from
undermining West Bank self-rule institutions;
• calculations that reprisals would be more advisable if and when the Palestinians take
further steps in connection with the ICC or other international forums; and
• concern that international and regional actors who may be willing to provide replacement
assistance for the Palestinians in the event of a change to U.S. aid levels could influence
the PA and the West Bank in ways that run counter to U.S. interests.91
Hamas and a “Unity Government”?
As discussed above (see “Major Conditions, Limitations, and Restrictions on Aid”), although
Fatah and Hamas reached various tentative agreements in 2011 and 2012 on a consensus PA
governing arrangement, questions persist over how the agreement might actually be implemented.
These questions include how PA and Hamas security operations might be integrated, when and
how Palestinian presidential and legislative elections might be conducted, and who might occupy
PA government positions. Current law, which would assign the same legal consequences for full
Fatah-Hamas power sharing to a PA government “over which Hamas exercises undue influence,”
89 Emily Cadei, “Palestinian U.N. Upgrade Triggers New Warning from Senators,” cq.com, November 29, 2012.
90 Following the adoption of Resolution 67/19, Israel announced that it would withhold approximately $115 million in
monthly customs and tax payments that it is generally legally bound to transfer to the Palestinian Authority (PA) under
the 1994 Israel-PLO “Paris Protocol”. The PA depends on this revenue to satisfy 40-45% of its monthly expenses.
Subsequent reports indicate that Israel might withhold monthly payments until as late as March 2013. The withholding
will ostensibly defray amounts (up to $350 million) owed Israel for utility expenses.
This is the case even though a private Palestinian-operated company is directly responsible for these unpaid expenses.
Daoud Kuttab, “Status of Electricity in Jerusalem: It’s Complicated,” Al-Monitor Palestine Pulse, January 6, 2013.
91 In testimony offered to the House Committee on Foreign Affairs, Subcommittee on the Middle East and South Asia,
on July 10, 2012, Jonathan Schanzer of the Foundation for Defense of Democracies said, in addressing the possible
consequences of a U.S. aid cutoff to the Palestinians, “I would say that, yes, we leave the playing field open to other
bad actors to step in, whether it be Iran, Saudi Arabia, Qatar. I think there is no shortage of actors. Of course, the
Muslim world is notorious for not making good on its pledges to the Palestinians for aid. But, nevertheless, if we
stepped out, we certainly would lose our leverage and potentially yield it to other actors that are working against U.S.
interests, and I would warn against it.”
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does not further define this phrase. Thus, it is unclear whether Hamas’s underlying approval of a
PA government that includes formally non-aligned “technocrats” instead of Hamas members
would be deemed to constitute “undue influence” over the government.92
Future debates might focus on the following issues:
• Whether a “power of approval” by Hamas over a PA government, absent any
further level of participation, should trigger a requirement for that government’s
acceptance and compliance with the Section 620K principles discussed above.
• Whether to relax or tighten U.S. restrictions on which Palestinian party/ies
should be answerable for accepting and complying with the Section 620K
principles.
• Whether to grant the U.S. President discretion—under certain conditions and/or
for specific purposes—to waive aid restrictions relating to a PA government that
includes or involves Hamas but does not meet the Section 620K principles.
Assuming that the United States chooses not to engage with and/or contribute to a PA government
that includes or involves Hamas, future debates might take place over the degree to which the
United States should actively dissuade others in the international community—particularly
European and Arab actors—from engagement and contributions.93
Questions Regarding a Two-State Solution
Even assuming that the immediate objectives of U.S. assistance to the Palestinians—relieving
humanitarian needs in Gaza and improving security and facilitating development in the West
Bank—are met, failure to achieve progress towards a politically legitimate and peaceful two-state
solution could undermine the utility of U.S. aid in helping the Palestinians become more
cohesive, stable, and self-reliant over the long term.
Many factors may complicate prospects for a negotiated two-state solution, including but not
limited to:
• Discord within and among Palestinian factions—reflected geographically by
divided rule in the West Bank and Gaza (unless and until consensus on interim
governing arrangements and/or elections is implemented) and ideologically by
Hamas’s refusal to join the PLO in forswearing violent resistance against Israel.
• Preconditions or conditions that Israel and the PLO have each attached to the
negotiating process and/or a final-status agreement.94
92 If §7040(f)(1) of H.R. 5857 (Department of State, Foreign Operations, and Related Programs Appropriations Act,
2013) were to be enacted in the form that was reported favorably by the House Appropriations Committee in May
2012, it would consider a PA government resulting from any agreement with Hamas—regardless of the level of
influence Hamas is deemed to exercise over the government—to have the same legal consequences as full power
sharing.
93 Previously when Hamas participated in the PA government from 2006-2007, the European Union joined the United
States in refusing to provide direct assistance to the PA. There are indications, however, that Europeans might be less
willing to follow the U.S. lead in the event that another PA government including Hamas is formed.
94 PLO Chairman Abbas has routinely expressed unwillingness to resume negotiations with Israel unless it halts Jewish
settlement construction in the West Bank and East Jerusalem and is willing to use the 1949-1967 armistice lines as the
(continued...)
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• Physical entrenchment of Israeli settlers in the West Bank and of obstacles to
Palestinian movement within the West Bank and in and out of both the West
Bank and Gaza, together with its political and socioeconomic consequences.
• Possibility of high-impact events—such as a major terrorist attack, a surprise
election outcome, an outbreak of war, or pursuit by Palestinians of political
strategies outside of negotiations with Israel. This possibility could increase as
result of the region-wide unrest and political change that has been ongoing since
late 2010.
The Gaza Situation
Hamas’s control of Gaza presents a conundrum for many that has become even more complicated
following the Israel-Gaza conflict of November 2012 (also known as Operation Pillar of
Defense). Most parties, including Israel and the PA, express concern that assisting Gaza’s
population and rebuilding infrastructure damaged during Operation Cast Lead (the 2008-2009
Israel-Gaza conflict) and the November 2012 conflict could bolster Hamas. Thus, while
controlled levels of basic sustenance and medical supplies have been permitted to enter Gaza,
reconstruction projects have been limited. Following the November cease-fire brokered by Egypt,
however, Israel has relaxed limits on the import of construction materials, and Egypt has allowed
a Qatari-sponsored $400 million reconstruction initiative for Gaza to send in truckloads through
the Rafah border crossing.
Largely as a result of an earlier Israeli easing of the closure regime at its crossings with Gaza in
2010, the World Bank estimated economic growth for Gaza to be approximately 20% for 2011,
but this immediate growth surge has since abated, dropping to around 6% in early 2012.95 Near
the end of 2011, real per capita GDP remained approximately 15% less than the pre-closure-
regime level of approximately $1,300—see Figure 1 below. More goods have come into Gaza,
and limited exports have resumed, but not to the Israel and West Bank markets that previously
constituted about 85% of Gaza’s exports.96
It is not clear if, when, and under what conditions a full resumption of agricultural and industrial
trade and movement of persons between Gaza and the outside world might be expected. In 2011,
following the resignation of President Hosni Mubarak, Egypt permanently opened its crossing
with Gaza at Rafah to passenger traffic, but because this has not extended to the passage of
goods, it appears not to have had a material effect on trade or smuggling to Gaza through tunnels
from Egypt’s Sinai Peninsula.97
(...continued)
basis for border negotiations. In Israeli Prime Minister Binyamin Netanyahu’s June 14, 2009, speech accepting the
concept of a two-state solution, Netanyahu insisted that the Palestinians would need to recognize Israel as the “nation
state of the Jewish people” and accept demilitarization with “solid security measures.”
95 World Bank, Fiscal Crisis, Economic Prospects: The Imperative for Economic Cohesion in the Palestinian
Territories, September 23, 2012.
96 Gisha – Legal Center for Freedom of Movement, “A Guide to the Gaza Closure: In Israel’s Own Words,” September
2011.
97 See, e.g., Nicolas Pelham, “Gaza’s Tunnel Phenomenon: The Unintended Dynamics of Israel’s Siege,” Journal of
Palestine Studies, vol. XLI, no. 4, summer 2012. According to information provided to CRS by Gisha in March 2012,
citing 2011 sources from the Israeli Ministry of National Economy and the Peres Center for Peace, smuggling tunnels
account for approximately 80% of total imports into Gaza and accounted for approximately 60% of Hamas’s 2010 total
(continued...)
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It is possible that either Hamas’s positions on the Quartet principles or its control over Gaza
would have to change before substantial U.S. funds might be used in the reconstruction of
buildings and infrastructure in Gaza, with the exception of U.N. facilities and other special cases
such as international schools. In the meantime, outside assistance from Iran, Egypt, Qatar, other
Gulf states, and Turkey may bolster Hamas’s rule and, combined with other factors, may
exacerbate the Palestinian political divide that exists between the West Bank and Gaza.
Additionally, unless the terms of the November 2012 cease-fire lead to a significant change in the
security status quo in and around Gaza, occasional skirmishes between Palestinian militants
(including Hamas) and Israel in Gaza’s border areas and continuing low-level rocket and mortar
fire from Gaza at targets in Israel could spiral into renewed conflict.
Some Members of Congress are routinely concerned that bilateral assistance for Gaza or
contributions to UNRWA could be misused and diverted to benefit Hamas or other terrorist
groups. Yet, some Members of Congress advocate expanding the level and type of humanitarian
and development assistance to Gaza—often at the same time they advocate easing, ending, or
even challenging the Israeli-Egyptian closure regime—arguing that Gazans need more support to
improve their economic, physical, and psychological situations. A 2012 U.N. report outlined
several challenges to Gaza’s liveability by extrapolating its conditions eight years forward to
2020.98
Strengthening the PA in the West Bank
Paradoxically, instability in the West Bank and the Gaza Strip is both a major reason for the
increases in U.S. assistance over the past five years and a factor that could lead some to oppose
maintaining or boosting current aid levels. After Hamas’s takeover of the Gaza Strip and
dismissal from the PA in June 2007, the United States made assisting the PA with economic
development and civil security a higher priority, with an aim of bolstering the standing of the
Abbas/Fayyad government. Yet, if lawmakers detect that the PA in Ramallah is unable to achieve
or maintain popular legitimacy and competent control in the West Bank within a reasonable
timeframe, their willingness to provide resources and training might decrease, given concerns that
aid could potentially be used against Israel or Palestinian civilians.
Some observers argue that U.S. assistance does not enhance the legitimacy of Abbas and the PA,
but rather detracts from it by leading some Palestinians to conclude that the PA is too beholden to
the United States.99 Others have warned that U.S. dependence on individual leaders such as Abbas
and Fayyad works against long-term stability by undermining mechanisms of democratic
governance and enabling authoritarianism.100 Abbas’s further consideration of actions outside of
negotiations with Israel—greater rapprochement with Hamas, international diplomacy aimed at
garnering support for Palestinian statehood and isolating Israel, support for nonviolent protests in
the West Bank, and even the threat of disbanding the PA—could decrease U.S. policymakers’
(...continued)
revenue ($300 million out of $500 million).
98 United Nations Country Team in the occupied Palestinian territory, Gaza in 2020: A liveable place?, August 2012.
99 See Sherifa Zuhur, Ali Abunimah, Haim Malka, Shibley Telhami, “Symposium: Hamas and the Two-State Solution:
Villain, Victim or Missing Ingredient?” Middle East Policy, vol. 15, issue 2, July 1, 2008; Transcript of National Public
Radio interview (“All Things Considered”) with Robert Malley, June 16, 2007.
100 See Nathan J. Brown, “Fayyad Is Not the Problem, but Fayyadism Is Not the Solution to Palestine’s Political
Crisis,” Carnegie Endowment for International Peace, September 2010.
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inclination to support a PA led by him.101 Allegations of corruption from some commentators also
may undermine U.S. support for Abbas.102
Economic Development and International Donor Assistance
In General
The appointment in June 2007 of Salam Fayyad, a former World Bank and International
Monetary Fund official, as PA prime minister raised hopes for Palestinian reform and economic
growth that have been realized in part. Fayyad has produced reform proposals aimed at
establishing a “de facto Palestinian state”103 that have helped garner major international donor
assistance pledges and promises of investment while gradually increasing PA revenues.
International pledges of support, however, have routinely proven insufficient to cover the PA’s
budgetary expenses, occasionally requiring efforts by Fayyad to obtain last-minute assistance
and/or private financing or to temporarily curtail PA employee salaries. To prevent the PA’s
insolvency at one point during 2012, Israel even provided occasional advances—totaling nearly
$200 million—on the transfer of tax and customs revenue that it collects on the PA’s behalf.
However, the financing gap persists between international donor commitments and the PA’s
budgeted needs—exacerbated by current Israeli withholding of tax and customs revenues it is
generally bound to transfer to the PA104—and may do so for the foreseeable future. According to a
March 2012 International Monetary Fund report, “There is little scope to cover that gap through
further arrears accumulation to the private sector or borrowing from commercial banks, given the
existing large stock of debt to businesses and banks. Therefore there is a high risk that the
persistence of that gap will result in cuts in essential spending, including wages and social
101 H.R. 5857, if enacted with §7039(h)(2) in its current form, would appear to condition FY2013 ESF aid for
Palestinians and UNRWA contributions in the West Bank and Gaza on the Secretary of State certifying that the PA “is
moving to halt anti-Israel incitement and is engaged in activities aimed at promoting peace and coexistence with
Israel.”
102 In testimony before the House Foreign Affairs Committee on September 14, 2011, Jonathan Schanzer of the
Foundation for the Defense of Democracies proposed that “Congress should challenge the corrupt system created by
Mahmoud Abbas. This includes, one, stricter oversight of the presidential waiver process that releases Palestinian funds
each year. Two, oversight of the Palestine Investment Fund, including a full audit. Three, conduct an inquiry into the
wealth of Mahmoud Abbas and his sons, Yasser and Tarek, to determine whether U.S. funds have contributed to their
holdings. Four, demand an immediate resolution to the matter of the electric power plant in Gaza. U.S. taxpayers
should not be [indirectly] financing Hamas. Number five, scrutinize the presidential budget of PA president Mahmoud
Abbas, and finally, find ways to increase the role of Prime Minister Salam Fayyad, who has been marginalized by
Abbas in recent years.” On May 8, 2012, Representatives Nita Lowey, Steve Israel, and Ted Deutch sent a letter to the
Comptroller General of the United States raising concerns about the Palestine Investment Fund (PIF) and requesting
information on the scope and nature of U.S. contributions to the PIF. See
http://israel.house.gov/index.php?option=com_content&task=view&id=1067&Itemid=73.
103 See, e.g., Palestinian National Authority, Palestine: Ending the Occupation, Establishing the State, Program of the
Thirteenth Government, August 2009, available at http://www.mideastweb.org/palestine_state_program.htm. A key
passage from the document reads: “Out of respect for our citizens, and in recognition of their desire to live free and
peaceful lives under national independence, we must answer their demand to see the fruits of the state-building project.
Against this background, the Palestinian government is struggling determinedly against a hostile occupation regime,
employing all of its energies and available resources, most especially the capacities of our people, to complete the
process of building institutions of the independent State of Palestine in order to establish a de facto state apparatus
within the next two years. It is time now for the illegal occupation to end and for the Palestinian people to enjoy
security, safety, freedom and independence.”
104 See footnote 90.
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transfers.”105 Analysts are speculating about the possible consequences for the PA’s continued
viability and for political and regional stability if it cannot meet its financial obligations,
especially monthly salary payments for the more than 150,000 employees on its payroll.106
The success of Fayyad’s reform plans appears to hinge on the following factors:
• Keeping the public sector solvent enough to sustain long-term private sector
development;
• Getting Israeli restrictions loosened or lifted on the movement of goods and
people both within and out of the West Bank and Gaza107 and on Palestinian
development projects in so-called “Area C”;108 and
• Overall political progress to overcome Palestinian factional/geographical division
and towards Palestinian statehood.109
Several high-profile projects—housing developments, industrial parks, superstores, entertainment
complexes—have been completed or are in various stages of proposal or construction in and
around Ramallah, Bethlehem, Jericho, and the northern West Bank in an effort to jumpstart
private sector development.110 Yet, most analysts assert that actual and prospective economic
development should not be overstated because the West Bank economy continues to be propped
up by external aid. After growth rates of approximately 10% in 2010 and 2011, estimated growth
for 2012 was around 5.4%.111 Furthermore, uncertainty remains regarding movement and access
and regarding progress in negotiations with Israel.
105 International Monetary Fund, Recent Experience and Prospects of the Economy of the West Bank and Gaza: Staff
Report Prepared for the Meeting of the Ad Hoc Liaison Committee, March 21, 2012.
106 One report estimates that 90,000 of the PA’s employees are in the West Bank, and the other 60,000 are in Gaza.
Reportedly, those in Gaza no longer actually work in civil service positions because the Hamas-led regime has replaced
them. “Arab states ‘completely incapacitated’ PA by withholding aid, Fayyad says,” Associated Press, January 6, 2013.
107 The current system of Israeli restrictions on movement within the West Bank can be traced to the time of the second
Palestinian intifada (which began in late 2000), and the closure of Gaza crossings and ports to the Hamas takeover in
June 2007.
108 Zones denoted as “Area C” in the West Bank pursuant to the Israel-PLO Interim Agreement on the West Bank and
the Gaza Strip, dated September 28, 1995, fall under Israeli administrative and security control.
109 See Nathan J. Brown, “Are Palestinians Building a State?”, Carnegie Endowment for International Peace, June
2010.
110 Some of these ventures have been supported by U.S. organizations—including the Overseas Private Investment
Corporation (OPIC), the Aspen Institute, the Center for American Progress, and CHF International—affiliated or
involved with a public-private partnership known as the Middle East Investment Initiative. See http://meiinitiative.org.
111 World Bank, op. cit.
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Figure 1. West Bank and Gaza Strip
Real Gross Domestic Product (GDP) Per Capita: 1998-2011
Sources: World Bank; Palestinian Central Bureau of Statistics.
Note: *Based on data for the first three quarters of 2011.
Arab States
Congress has indicated its interest in staying abreast of the economic assistance that Arab state
governments provide to the West Bank and the PA, sometimes requiring reports from the
Administration on the subject.112 Arab states (especially Gulf states) provided large amounts of
aid to the Hamas-led PA government in 2006-2007 after the United States and European Union
withdrew their aid, but following the reinstitution of U.S. and EU aid in mid-2007, most of them
reduced contributions.113 Routinely, they make generous pledges of aid to the Palestinians, but at
times fulfill them only in part and after significant delay. The largest Arab donor to the PA budget
is Saudi Arabia, which generally contributes between $100-250 million annually.
Although Arab governments called at a December 2012 League of Arab States (Arab League)
meeting for the immediate implementation of a plan to provide $100 million per month to the PA
to compensate for Israel’s withholding of tax and customs revenues (a reprisal for the adoption of
UNGA Resolution 67/19), the decision did not specify which countries would pay or when. After
expressions of concern by PA leaders and appeals from the Arab League, Saudi Arabia agreed in
January 2013 to provide $100 million to the PA.
112 See, e.g., H.Rept. 111-366 (to P.L. 111-117, Consolidated Appropriations Act, 2010): “The conferees direct the
Secretary of State to provide a report to the Committees on Appropriations not later than 180 days after enactment of
this Act on international participation, including by Arab states, in the economic development of the West Bank and
support for the Palestinian Authority, similar to that proposed by the House. This report may be submitted in classified
form, if necessary.”
113 See Glenn Kessler, “Arab Aid to Palestinians Often Doesn’t Fulfill Pledges,” Washington Post, July 27, 2008;
“Falling Short,” Washington Post, July 27, 2008.
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Arab governments’ reluctance to fulfill pledges may stem from misgivings over “picking sides”
in Palestinian factional disputes and from concerns that without imminent prospects either for
domestic political unity or for progress on the peace process, any money contributed could be a
waste. Under the same rationale, future progress toward domestic unity could lead to larger
contributions.114 On the part of the Gulf states in particular, reluctance may also stem from a
feeling that they are less responsible historically for the Palestinians’ current situation than Israel,
the United States, and Europe.115 Also, according to Reuters, “A high of $1.8 billion in foreign aid
[from Arab countries to the PA] in 2008 plunged to $600 million last year, with Gulf countries
scaling back their giving because of increased domestic spending over two years of Arab political
uprisings and the global financial downturn.”116
Conclusion
Implementing U.S. bilateral assistance programs for the West Bank and Gaza and making
UNRWA contributions presents significant challenges due to regional political uncertainty,
ongoing Israeli-Palestinian disputes, and concerns that aid might be diverted to Palestinian
terrorist groups. Prospects for stability in the West Bank appear to hinge on improved security,
beneficial political and economic developments, Israeli cooperation, and continuation of high
levels of foreign assistance.
In assessing whether U.S. aid to the Palestinians since the June 2007 West Bank/Fatah-Gaza
Strip/Hamas split has advanced U.S. interests, Congress could evaluate how successful aid has
been in
• reducing the threat of terrorism;
• inclining Palestinians towards peace with Israel;
• preparing Palestinians for self-reliance in security, political, and economic
matters;
• promoting regional stability; and
• meeting humanitarian needs.
Given that evaluation, Congress will assess future aid in the context of U.S. policy priorities.
Such evaluation and assessment might influence its deliberations over
• which aid programs to start, continue, expand, scale back, change, or end; and
• which oversight, vetting, monitoring, and evaluation requirements to apply to
various aid programs.
114 For example, Qatar, not a major contributor to the PA in recent years, provided $30 million in budgetary assistance
in March 2012, one month after its leaders brokered an agreement aimed at a consensus PA government approved by
both Fatah and Hamas. At least one early 2012 report indicates that Qatar also provided some funding to Hamas. Yezid
Sayigh, “Hamas Looks to the Future: With Gains Come Dilemmas,” Posted on Carnegie Middle East Center website
(reportedly originally published in Arabic in Al Hayat), March 8, 2012. As discussed above, the Qatari-brokered
agreement was reportedly later rejected by Hamas, largely owing to an intra-factional dispute.
115 See, e.g., Robert Bowker, Palestinian Refugees: Mythology, Identity, and the Search for Peace, Boulder, CO: Lynn
Rienner Publications, Inc., 2003, p. 194.
116 “Saudis to give $100 million to Palestinian Authority,” Reuters, January 16, 2013.
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Appendix A. Recent Historical Background
Since the establishment of limited Palestinian self-rule in the West Bank and Gaza Strip in the
mid-1990s, the U.S. government has committed more than $4 billion in bilateral assistance to the
Palestinians in the West Bank and Gaza,117 who are among the largest per capita recipients of
foreign aid worldwide.118 This assistance has focused on the further development of the
Palestinian economic, social services, and civil society sectors; and on strengthening the
processes, governance, and security-providing capacities of PA institutions.
Following the death of Yasser Arafat in 2004 and his succession by Mahmoud Abbas as PA
president in 2005, Congress and the Bush Administration increased U.S. assistance to the
Palestinians. However, after the 2006 Hamas victory in Palestinian Legislative Council elections
reversed the renewed sense of U.S. optimism in elected Palestinian leadership, U.S. assistance
was restructured and reduced. The United States halted direct foreign aid to the PA but continued
providing humanitarian and project assistance to the Palestinian people through international and
NGOs. The ban on direct assistance continued during the brief tenure of a Hamas-led power-
sharing government (February to June 2007). During that time, the United States and the other
members of the international Quartet (the United Nations Secretary-General’s office, the
European Union, and Russia) unsuccessfully demanded that Hamas accept the Quartet
principles—recognition of Israel’s right to exist, renunciation of violence, and acceptance of
previous Israeli-Palestinian agreements.
Subsequent events altered the situation dramatically. In June 2007, Hamas forcibly took control
of the Gaza Strip. PA President and Fatah head Mahmoud Abbas, calling the move a “coup,”
dissolved the power-sharing government and tasked the politically independent technocrat Salam
Fayyad to serve as prime minister and organize a new PA “caretaker” government in the West
Bank. Within days, the United States lifted its economic and political embargo on the PA.
The Bush Administration and Congress then boosted U.S. aid levels in hopes of fostering an
economic and security climate conducive to peaceful coexistence between Israel and a future
Palestinian state. The revival of Israeli-Palestinian negotiations for a final-status agreement in
conjunction with the Annapolis Conference of November 2007119 provided further impetus for
U.S. economic support of institutional and societal building blocks for Palestinian self-
governance. The Obama Administration has advocated a similar approach. Attempts by both
Administrations to broker an Israeli-Palestinian negotiating process that yields a substantive and
lasting resolution of core issues in dispute (borders, security, refugees, the status of Jerusalem,
settlements, and water rights) have thus far proven unsuccessful.
117 Prior to the establishment of limited Palestinian self-rule in the West Bank and Gaza, approximately $170 million in
U.S. developmental and humanitarian assistance (not including contributions to UNRWA) were obligated for
Palestinians in the West Bank and Gaza from 1975-1993, mainly through non-governmental organizations. CRS Report
93-689 F, West Bank/Gaza Strip: U.S. Foreign Assistance, by Clyde R. Mark, July 27, 1993, available on request to
Jim Zanotti.
118 Net official development assistance per capita figures for all countries for 2007-2011 are available at
http://data.worldbank.org/indicator/DT.ODA.ODAT.PC.ZS.
119 The Annapolis Conference was organized by then President George W. Bush and attended by Mahmoud Abbas,
then Israeli Prime Minister Ehud Olmert, and several Western and Arab heads of state seeking to help restart the peace
process following violence both among Palestinians and between Israelis and Palestinians earlier in the decade.
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Prospects for negotiations may be even dimmer for the near term given various factors. These
factors include heightened Israeli security concerns in the context of region-wide political
uncertainty and the rocket threat Israel faces from Hamas and other Gaza-based militants, as
borne out by a weeklong November 2012 conflict. Factors working against a resumption of
negotiations may also include efforts by the Fatah-led PA and PLO to pursue widespread
international recognition of Palestinian statehood and possible rapprochement with Hamas, as
well as continuing Israeli announcements of residential construction and planning in West Bank
settlements and in East Jerusalem.120
120 See footnote 56.
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Appendix B. Congressional Holds on FY2011 Aid
Various Members of congressional committees with jurisdiction over the authorization and
appropriation of U.S. aid to the Palestinians placed informal holds on the obligation of the
following tranches of already-appropriated FY2011 assistance after congressional notifications by
the Obama Administration on August 18, 2011:
• $192.2 million in Economic Support Fund (ESF) project assistance for the West
Bank and Gaza to be distributed through NGOs;121 and
• $147.6 million in International Narcotics Control and Law Enforcement (INCLE)
non-lethal assistance for PA security forces.122
Media reports and statements from Member offices indicated that Representative Kay Granger,
chairwoman of the House Appropriations Subcommittee on State, Foreign Operations, and
Related Programs; Representative Ileana Ros-Lehtinen, then chairman of the House Foreign
Affairs Committee; and some members of the Senate Foreign Relations Committee had placed a
hold on the funds (with Granger not participating in the hold on the INCLE portion).123 The hold
on INCLE funding was lifted in the fall of 2011. By March 2012, all Members other than Ros-
Lehtinen had decided to release the hold on the ESF portion.124 Ros-Lehtinen reportedly agreed to
release her hold over all but approximately $60 million of the ESF project assistance for the West
Bank and Gaza, subject to various conditions. She reportedly asked that the Administration not
use the funds released for “‘assistance and recovery in Hamas-controlled Gaza,’ West Bank road
construction, or trade and tourism promotion in the Palestinian territories.”125 She also reportedly
expressed concern that the Administration had “threatened to spend the money ‘over
congressional objections’ if the lawmakers' holds were not lifted.”126
At a March 20, 2012, House Foreign Affairs Committee hearing addressing the Obama
Administration’s FY2013 budget request for foreign aid, Chairman Ros-Lehtinen asked USAID
Administrator Rajiv Shah for a written response to questions she posed and statements she made
regarding aid to various countries. She made the following statements regarding U.S. aid to the
Palestinians:
On funding for the Palestinian Authority, Dr. Shah, the administration is pressing Congress
to release $147 million for Palestinians in the West Bank and Gaza. Among the arguments
utilized is that Abu Mazen [Mahmoud Abbas] needs to be supported because he’s all we
have. However, the administration is not demanding that [Abbas] return to the negotiation
table with Israel without preconditions, nor that he stops his unilateral statehood scheme at
the U.N.
The administration also says we need to help rebuild the Palestinian economy, this at a time
when our economy is facing serious challenges, and Americans are suffering.
121 USAID FY2011 Congressional Notification #133, August 18, 2011.
122 State Department FY2011 Congressional Notification, August 18, 2011.
123 Mary Beth Sheridan, “Wasting no time in blocking Palestinian aid,” washingtonpost.com/blogs/checkpoint-
washington, October 4, 2011.
124 “U.S. lawmakers release $88.6 million in aid to Palestinians,” Reuters, April 4, 2012.
125 Ibid.
126 Ibid.
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Now in the list of projects the administration wants to fund with the $147 million in taxpayer
dollars, there are some that are aimed at addressing humanitarian concerns—funding for
water programs, health, food aid, and support for USAID programming. Congress and the
administration can find common ground on these.
However, there are others that Congress finds difficult to justify as advancing U.S. national
security interests or in assisting our ally and friend Israel. In this respect, if you could justify
$2.9 million for trade facilitation, $4.5 million for tourism promotion, and $8.1 million for
road construction.
Specifically, I would ask that you justify a total of $26.4 million in reconstruction and
recovery for Hamas-run Gaza that includes cash-for-work programs. And more broadly, how
much has the U.S. spent in total since 1993 in West Bank and Gaza, and how much is the
administration proposing we spend next year, and how can we justify that?
In April 2012, the National Journal reported that Secretary of State Hillary Clinton had decided
to provide the entire remaining amount of appropriated FY2011 ESF project assistance despite
Chairman Ros-Lehtinen’s hold.127 The report cited an unnamed State Department official as
stating that the funds deliver
critical support to the Palestinian people and those leaders seeking to combat extremism
within their society and build a more stable future. Without funding, our programs risk
cancellation. Such an occurrence would undermine the progress that has been made in recent
years in building Palestinian institutions and improving stability, security, and economic
prospects, which benefits Israelis and Palestinians alike.128
None of the $200 million in FY2011 direct budgetary assistance for the PA was subjected to a
hold. The New York Times reported in September 2011 that Israeli Prime Minister Binyamin
Netanyahu “urged dozens of members of Congress visiting Israel [in August] not to object to the
aid,” at the Administration’s request.129
Author Contact Information
Jim Zanotti
Specialist in Middle Eastern Affairs
jzanotti@crs.loc.gov, 7-1441
127 Sara Sorcher, “Clinton Overrules Republican Lawmaker's Hold on Palestinian Aid,” nationaljournal.com, April 11,
2012.
128 Ibid.
129 Jennifer Steinhauer and Steven Lee Myers, “House Republicans Discover a Growing Bond with Netanyahu,” New
York Times, September 21, 2011.
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