5 things to know about US funding to Palestinians and terror payments

Can the US offer financial assistance to the Palestinians even while the Palestinian Authority pays monthly stipends to terrorists and their families?

The question was raised by reporters and pundits on Wednesday when the US announced it planned to restore humanitarian and security assistance to the Palestinians, as part of an overall financial package of $290 million.

Former US president Donald Trump cut all funding to the Palestinians, which had soared close to $600 million annually under the Obama administration.

Trump also put in place legislation to hold the PA financially accountable for terror activity and to halt its practice of terror stipends, known as “pay-for-slay.”

A reporter referenced that legislation when quizzing US State Department spokesman Ned Price on how the Biden administration could legally restore funding.

“US laws – there’s several of them – say that the US cannot provide money to the Palestinian Authority,” the reporter stated.

Price assured him that the funding was “absolutely consistent with relevant US law.”

Here are five things to know about US funding to Palestinians and PA terror payments:

The Palestinian Authority provides monthly stipends to the families of terrorists who are killed while engaging in acts of terrorism, and to those jailed for terrorist acts or on suspicion of terrorist activity.

It is estimated that the PA spends at least NIS 500 million annually on these stipends, with higher payments going to those whose crimes were more severe and who have longer jail sentences.

Proponents of “pay-for-slay” brand the payments as a kind of social welfare system, particularly in light of Israel’s practice of administrative detentions in which security prisoners can be held without charges. 

Opponents have argued that if this were the case, payments would be based on need rather than the severity of the crime.

US military veteran Taylor Force was stabbed to death in March 2016, while in Israel for a business program, near the beach in Tel Aviv by a Palestinian. Two years later the US Congress passed legislation prohibiting direct assistance to the PA, to prevent terror payments based on US funds going to anyone associated with Force’s death.

The Biden administration intends to uphold that legislation, including not paying PA loans.

The anti-terror clarification act of 2018 allowed the Palestinian Authority to be financially liable should it be found guilty in US courts of supporting terror activity. The legislation was broadly written so that even humanitarian assistance to non-governmental Palestinian organizations, peace-building funding or scholarship funding puts the PA in a position of liability.

The PA notified the US in 2019 that it would not accept any funding, including humanitarian assistance, over fear of judicial liability. Subsequent Congressional legislation amended the ATCA to allow financial assistance to the Palestinian people, but leaving intact judicial liability issues for direct funding to the PA and the Palestine Liberation Organization.

The US-trained Palestinian security forces, which cooperate with the IDF, are considered an essential pillar of stability in the West Bank. Funding for those forces, which had amounted to $60 million annually, was exempt under the Taylor Force Act.

Joel Braunold, managing director of the S. Daniel Abraham Center for Middle East Peace, said that the Taylor Force Act was specifically intended to target the Economic Support Funds account that drew on “bilateral economic assistance and humanitarian traditional programs in the West Bank and Gaza.”

But it was not intended to “affect security assistance that comes from the International Narcotics and Law Enforcement account (INLE), not covered by Taylor Force requirements.”

Funding for the security forces, however, was impacted by the ATCT, a problem corrected by amendments to that legislation. The Biden administration has now resumed funding to the PA security forces.

The majority of US funding to the Palestinians had always gone through the United Nations Relief and Works Agency for Palestinian refugees, amounting to an annual grant of over $350 million. The US was the single largest donor to UNRWA.

The Trump administration’s decision in 2018 to cut funding to UNRWA was not based on prohibitions in the ATCT or the Taylor Force Act. There was no legal impediment to continued US funding to UNRWA, which services 5.7 million Palestinian refugees in east Jerusalem, Gaza, the West Bank, Lebanon, Jordan and Syria.

The Trump administration made a policy decision not to support the organization because it believed that Palestinians could be better served by other organizations. It agreed with Israel that UNRWA’s definition of who is a Palestinian refugee was problematic, and that the organization was inefficient and promoted incitement against Israel.

The Biden administration has now made a policy decision to support UNRWA, with an initial grant of $150 million.