Consolidated Appropriations Act, 2017

January 4, 2017
May 5, 2017
Became Public Law

After congressional leaders failed to reach a compromise on FY 2017 appropriations in 2016, they extended FY 2016 appropriations for all government programs and agencies through 5/5/17 (see *H.R. 5325 of 5/25/16 and *H.R. 2028 of 4/24/16 at and *H. J. Res. 99 of 4/26/17 below). As the 5/5/17 deadline approached, they drafted and agreed to this compromise appropriations bill, which includes provisions on military aid to Israel and economic aid for the Palestinians, inter alia.

Assistance to Israel

Consistent with previous years and in accordance with the 2007 U.S.-Israel memorandum of understanding, no less than $3.1 b. in foreign military financing (FMF) is made available for Israel, of which the Israeli government would be permitted to spend $815.3 m. outside the United States. (This is a unique arrangement among all recipients of U.S. military aid that effectively subsidizes the Israeli defense industry.)

Some $113 m. greater than the FY 2016 appropriation, $600.7 m. is allotted to “cooperative” U.S.-Israeli programs, including $62 m. for Israel’s Iron Dome missile defense system. Furthermore, $266.511 m. is earmarked for the Short Range Ballistic Missile Defense Program (no more than $90 m. of which is obligated until the Trump administration reaches an agreement for co-production in the United States); $204.893 m. is set aside for an upper-tier component of Israel’s missile defense architecture ($120 m. of it for co-production of Arrow 3 missiles in the United States and up to $70 m. to be obligated until the Trump administration reaches an agreement for coproduction in the United States); and $67.332 m. allocated to the Arrow System Improvement Program.

In a new provision this year, $75 m. in foreign military financing is allotted to Israel from the broader budget for overseas contingency operations and programs affiliated with the Global War on Terror.

As in previous years, interest and earnings accrued by the Israeli Arab Scholarship Program’s endowment are authorized for expenditure. No specific totals are provided in the bill or its accompanying explanatory materials.

Down from $10 m. in FY 2015 and FY 2016, $7.5 m. is designated for resettlement in Israel of immigrants from Eastern Europe.

In another provision carried over from previous years, no funding for the UN Human Rights Council (UNHRC) is allowed unless the secretary of state can determine and report to Congress that the UNHRC is taking steps to remove Israel as a permanent agenda item and that U.S. participation in the UNHRC is of national interest. Furthermore, the secretary of state is required to report to Congress on the resolutions considered at the UNHRC over the previous year and on any action that is taken to remove Israel from the agenda.

Funding for the PA and Programs in the West Bank and Gaza

As in previous years, funds are authorized to support the Palestinian Authority (PA) as well as programs serving Palestinians in the West Bank and Gaza (known as Economic Support Fund or ESF), but no specific funding totals are provided. Prior to FY 2015, the State Department’s budget requests were generally granted in full; however, only $290 m. and $205.517 m. were ultimately spent on these programs in FY 2015 and FY 2016, respectively, marking a significant reduction from the $370 m. requested every year. The extent of funding for these programs is therefore again unclear for FY 2017.

The State Department requested $327.6 m. in ESF for programs in the West Bank and Gaza, to “preserve the viability of a negotiated, two-state solution to the Israeli-Palestinian conflict by working with the [PA] to build the institutions of a future Palestinian state to deliver services to the Palestinian people.” The department requested an additional $35 m. from the broader request for international narcotics control and law enforcement (INL) funds to “continue to build the capacity of the [PA] security sector and sustain the capabilities of the PA security forces.”

Prior to disbursement of any ESF, the secretary of state is required to report to Congress that the purpose of the transfer is to either “advance Middle East peace,” “improve security in the region,” “continue support for transparent and accountable government institutions,” “promote a private sector economy,” or “address urgent humanitarian needs.”

In a recurring provision, all ESF transfers to these programs are to be suspended if the Palestinians initiate or support an International Criminal Court–authorized investigation into alleged Israeli war crimes or if the Palestinians achieve the standing of a member state at the UN or any agency thereof outside a negotiated settlement with Israel. The secretary of state is permitted a national security waiver of this restriction, so long as he reports to Congress on how the waiver would “assist in furthering Middle East peace.” Furthermore, ESF to the Palestinians is to be deducted by an amount equal to that paid out by the PA, the PLO, or any successor organizations to Palestinians imprisoned by Israel and to the families of Palestinians killed while committing acts of armed resistance in the previous calendar year.

As in previous years, the president is authorized to waive the ban on a PLO office in the United States if he certifies to Congress that the Palestinians have not obtained member state status or equivalent standing at the UN or in any UN body, and that they have not “taken any action . . . intended to influence a determination by the ICC to initiate a judicially authorized investigation” into alleged Israeli war crimes against Palestinians. If the president is unable to make these certifications, he is still permitted a waiver if he can certify that the Palestinians have entered into “direct and meaningful” negotiations with Israel.

Finally, the secretary of state is required to submit 2 reports to Congress: the first, about assistance provided to the PA Security Forces (PASF), including “detailed descriptions” of training, curriculum, and equipment provided; an assessment of the PASF before and after training; a description of the assistance provided to the PASF by other countries; and a description of any modifications to the PA’s security strategy; and second, new this year, detailing any “steps taken by the PA to counter incitement of violence against Israelis and to promote peace and coexistence with Israel.”

Military Assistance to Egypt

In keeping with practice in recent years, the secretary of state must certify that the Egyptian government is “sustaining the strategic relations with the United States” and “meeting its obligations under the 1979 Egypt-Israel Peace Treaty” in order for any ESF or FMF to be released to Egypt. Of the $112.5 m. appropriated in ESF to Egypt (down from $150 m. in FY 2016), no less than $35 m. is made available for higher education programs and no less than $10 m. is set aside for scholarships to financially needy students. The secretary of state is directed to withhold ESF in an amount equivalent to the bail money expended by the United States and on legal and court fees by NGOs in connection with so-called democracy-related trials in Egypt (as in previous years, the secretary would be able to annul this provision by certifying to Congress that Egypt had dismissed the 6/4/13 convictions of 16 U.S. citizens on charges related to using foreign funds to destabilize the government). Furthermore, 15% of Egypt’s FMF would be held until the secretary certifies that the Egyptian government is taking “effective” steps to advance democracy and human rights in Egypt; implementing reforms protecting freedoms of expression, association, and peaceful assembly; releasing political prisoners and providing detainees with due process of law; holding Egyptian security forces accountable; and providing regular access for U.S. officials to monitor such assistance in areas where it is used. The secretary is permitted a national security waiver on the FMF restriction so long as he reports to Congress on which requirements cannot be met. He is also directed to take all “practicable steps” to ensure monitoring and oversight mechanisms are in place and to report to Congress on any plan to restructure military assistance for Egypt.

The ESF appropriation listed above is available for the creation or operation of 1 or more “enterprise funds” for Egypt (see *H.R. 2029 of 4/24/15 at for background on enterprise funds). An unspecified amount of ESF is made available for loan guarantees to Egypt.

Finally, Egypt is authorized to lease certain military materials from U.S. commercial suppliers if the president determines that there are “compelling foreign policy or national security reasons” to do so.

Oversight and Policy on Iran

Unspecified funds are made available to support: the U.S. policy to “prevent Iran from achieving the capability to produce or otherwise obtain a nuclear weapon”; an “expeditious” response to any violation of the 7/14/15 JCPOA or UNSC Resolution 2231, which codified it; the implementation and enforcement of sanctions on Iran related to terrorism, human rights abuses, ballistic missiles, and weapons proliferation. Funds are made available for so-called democracy programs in Iran.

In terms of congressional oversight, the secretary of state is required to continue filing biannual reports to Congress on Iran’s compliance with the 7/14/15 JCPOA, submit a report on the status of U.S. and multilateral sanctions on Iran, report on the transfer of $1.7 m. to Iran that was announced on 1/17/16 (see S. 3117 of 6/29/16 at for details on that requirement), and inform the relevant congressional committees of any new information on the agreement between Iran and the International Atomic Energy Agency at the time of the 7/14/15 nuclear deal.

As in FY 2016, an unspecified amount of the $50.5 m. appropriated for promoting “internet freedom globally” is made available for such activities in Iran.

Military and Economic Support for Jordan

No less than $1.27995 b. is made available to Jordan across a variety of funding categories, including $475 m. in direct budget support for the Jordanian government (up from $204 m. in FY 2016). In addition, an unspecified amount is made available to implement the Jordan Compact Action Plan and the Jordan Response Plan for the Syria Crisis 2016–18, and up to $500 m. is made available for the Jordanian government to enhance security along its borders.

An unspecified amount of ESF is made available for loan guarantees to Jordan.

Responding to the Crisis in Syria and Iraq

This bill contains numerous provisions designed to counter the threat posed by ISIS in Syria and Iraq or to alleviate the humanitarian crisis in Syria, by supporting specific Syrian and Iraqi armed groups, so long as they adhere to U.S. conditions, an approach unchanged from previous years. To advance U.S. goals, $1.61 b. is made available for the Counter-ISIL Overseas Contingency Operations Transfer Fund and another $980 m. to provide “training; equipment; logistics support, supplies, and services; stipends; infrastructure repair and renovation; and sustainment” to certain vetted Syrian rebel groups, so long as they are committed to fighting ISIS, they have no connection with Iran or designated terrorist groups, and that they respect “human rights and the rule of law.” The secretary of defense is required to notify Congress 15 days prior to any transfer of funds under these provisions. New this year, the abovementioned $980 m. comes from the newly created Counter-ISIL Train and Equip Fund. Similar funding in previous years’ legislation came from separate “train and equip funds” for groups in Syria and Iraq.

As in FY 2016, ESF, FMF, INL, and funds appropriated to peacekeeping operations support the provision of nonlethal assistance to certain vetted programs whose purpose is to establish representative, inclusive, and accountable government in Syria; develop and implement democratic, transparent, and lawful political processes; further develop the Syrian opposition; develop civil society and an independent mass media; promote stability and economic development; document, investigate, and prosecute human rights violations; expand the role of women in negotiations to end the violence and in any political transition; assist Syrian refugees complete education requirements at regional academic institutions; assist “vulnerable populations” in Syria and neighboring countries; and counter extremism. New this year, such funds are also made available to political and economic programs that empower women, protect and preserve the cultural identity of the people of Syria as a counterbalance to extremism, and protect and preserve cultural heritage sites in Syria. Furthermore, such funds are also made available “to continue a program to strengthen the capability of Syrian civil society organizations to address the immediate and long-term needs of the Syrian people inside Syria.” Additional funds are available under the act for explosive ordnance disposal programs in areas “liberated from extremist organizations” and for general assistance in areas liberated from ISIS.

Said funds are made available only after the secretary of state submits an update on the comprehensive U.S. strategy for Syria and “takes all practicable steps” to ensure that monitoring and oversight procedures are in place.

In another provision carried over from previous years, the Defense Department is barred from entering into contracts of any kind with Rosoboronexport—the Russian state intermediary agency for the import and export of arms—unless the secretary of defense can certify that to do so is in the interest of national security or if Rosoboronexport has, inter alia, ceased transferring arms to the Syrian government.

Assistance to Lebanon

As in the previous two years, an unspecified amount of FMF is made available to Lebanon “to professionalize the [Lebanese Armed Forces (LAF)] and to strengthen border security and combat terrorism, including training and equipping the LAF to secure Lebanon’s borders, interdicting arms shipments, preventing the use of Lebanon as a safe haven for terrorist groups, and to implement [UNSC] Resolution 1701” which called for a full cessation of hostilities after Israel launched the July 2006 war on Lebanon (also known as the second Lebanon war), inter alia. Further FMF, as well as an unspecified amount of INL, is made available “to address security and stability requirements in areas affected by the conflict in Syria” with programs and equipment specifically destined to the LAF and Lebanon’s Internal Security Forces (LISF). None of these funds remain available if the LAF is controlled by a U.S.-designated terrorist organization, and they can only be transferred once the secretary of state submits a spending plan to Congress, including a proposal for actions to be taken if the funds are misused. An unspecified amount of ESF to Lebanon is also included in the legislation.

Although State Department requests for Lebanon have not always been a good indicator of how much money is ultimately transferred, they are worth looking into for the spending rationale they convey. The State Department requested $110 m. in ESF to support “Lebanese institutions that advance internal and regional stability, combat the influence of extremists, and promote transparency and economic growth,” and $105 m. in FMF to help the LAF maintain Lebanon’s borders and national territory against “extremist threats, including [ISIS] and al-Nusra.” Finally, the department requested $10 m. in INL to help the LISF “become more responsive to the public’s internal security needs” and to “enhanc[e] the ability of Lebanon’s criminal justice institutions to work together to provide effective criminal justice and internal security services to the public.”

Funding and Restrictions on Relevant Government Entities and International Programs/Agencies

Migration and Refugee Assistance (MRA): Although neither the bill nor its explanatory materials include any specific appropriation to the UN Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), U.S. funding for UNRWA typically comes out of the appropriation to the Emergency Refugee and Migration Assistance (ERMA) fund ($2.15 b. and $40 m., respectively). U.S. contributions to UNRWA averaged $382.9 m. per year in FY 2014–16, and a similar amount is expected in FY 2017. As in previous years, the secretary of state must certify, prior to the disbursal of any funds, that the agency is using its local officers to inspect agency installations and report on any inappropriate use; “taking steps to ensure” the content of all its education materials are consistent with values of human rights, dignity, and tolerance, as well as being free from incitement; avoiding financial institutions and other entities that would put the agency in conflict with U.S. law; and complying with the UN’s biennial audit requirements.

Reconciliation Programs: As in FY 2016, no less than $26 m. is made available to support “people-to-people” reconciliation programs in areas of civil strife and war around the world. Unlike last year, there is no specific appropriation designated for programs in the Middle East.

International Peacekeeping Activities: Down from $2.12 b. in FY 2015 and $1.8 b. in FY 2016, $1.35 b. is made available for contributions to these activities. Specific activities and agencies are not listed in the bill, but the State Department requested $149 m. for the UN Interim Force in Lebanon (UNIFIL) and $14.05 m. for the UN Disengagement Observer Force (UNDOF) operating on the Syria-Israel border, which is operating at a reduced force level of 800, down from 1,250, due to “force protection measures.”

Complex Crises Fund: Matching the $30 m. appropriation in FY 2016, $30 m. is earmarked for this program, which has been used to address instability caused by political transitions in the Middle East. In its budget request, the State Department noted that “these funds will target countries that demonstrate a high or escalating risk of conflict, instability, or atrocities.”

Center for Middle Eastern–Western Dialogue (The Hollings Center for International Dialogue): Interest and earnings accrued by the center’s trust fund are made available. The bill’s explanatory materials give no specific figure, unlike in previous years.

Broadcasting Board of Governors (BBG): $722 m. is made available for the BBG to carry out “international communication activities, and to make and supervise grants for radio and television broadcasting to the Middle East.” The BBG is directed to notify Congress within 15 days if any of its broadcast entities are providing an open platform for designated terrorist groups.

Prohibition against Direct Funding for Certain Countries: As in previous years, loans, credits, insurance, and guarantees to the governments of Cuba, North Korea, Iran, and Syria are banned.

Coups d’État: Unless the secretary of state can certify that a democratically elected government has subsequently taken power, all assistance would be cut off to any country whose head of government is deposed by military overthrow. This provision does not apply to programs promoting “democratic elections or public participation in the democratic process.”

Notification Requirements: No funds may be appropriated to select countries (including Bahrain, Egypt, Iran, Iraq, Lebanon, Libya, Syria, and Yemen) outside regular appropriations committee notification procedures.

Arab League Boycott of Israel: Expressing Congress’s opposition to the boycott, this provision encourages the Arab League to normalize relations with Israel, calls on the U.S. president and secretary of state to help end the boycott, and urges the president to report to Congress annually on steps taken to do so.

Palestinian Statehood: No support is permitted for the establishment of a Palestinian state unless the secretary of state certifies that certain conditions are met, including the ability of the “governing entity” to demonstrate a commitment to peaceful coexistence with Israel and to the pursuit of “counterterrorism” measures in the West Bank and Gaza. Under the legislation, the PA or the governing entity of a new Palestinian state is required to terminate all claims of “belligerency,” to respect the “sovereignty, territorial integrity, and political independence of every state in the area through the establishment of demilitarized zones and other measures, and is working toward establishing a framework to settle the refugee question.” The president is permitted a national security waiver on this provision.

Business with the PA in Jerusalem: No funds appropriated in this bill may be spent on a diplomatic mission of any kind in Jerusalem, except for the U.S. consulate, to conduct business with the PA or any successor government.

Palestinian Broadcasting Corporation (PBC): Funding of the PBC is prohibited.

Assistance for the West Bank and Gaza: Prior to the disbursal of any ESF to programs in the West Bank or Gaza, the secretary of state must certify that none of the money goes to any person or group that participates in or advocates for “acts of terrorism” and that all grantees are thoroughly vetted. These provisions are subject to audit and investigation, for which up to $500,000 are appropriated to USAID. Furthermore, no U.S. aid is available for “the purpose of recognizing or otherwise honoring individuals who commit or have committed acts of terrorism” and no funds appropriated for security assistance in the West Bank and Gaza are made available until the secretary of state reports to Congress that the Palestinians comply with certain benchmarks.

Limits on Aid to the PA: Barring a presidential national security waiver, aid to the PA is restricted and conditional. If the president exercises the waiver, the secretary of state would have to certify that the PA establishes a single treasury account through which to channel aid, establishes a comprehensive civil service roster and payroll, is working to counter violence against Israelis, and is supporting activities promoting peaceful coexistence.

Prohibition of Assistance to the PLO and Hamas: Aid transfers in support of the PLO are barred. No funds are permitted to help pay the salaries of PA employees in Gaza or to support Hamas, any power-sharing government of which Hamas is a member, any government resulting from an agreement with Hamas, or one in which Hamas exercises “undue influence.” The president may waive this restriction if he can certify that all ministers in such a power-sharing arrangement have publicly accepted and complied with two principles: recognition of the “Jewish state of Israel’s right to exist” and acceptance of previous bilateral agreements. If the president exercises the waiver, the secretary of state would have to submit to Congress a quarterly report on the power-sharing government guaranteeing that all its ministers are continuing to uphold the aforesaid principles. If the president cannot provide said certification, aid may still be disbursed, but only to specific agencies and programs, including the office of the PA president.

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