The National Endowment for Democracy, a nonprofit that has had bipartisan support over decades for its work promoting democracy abroad, is suing the U.S. government and cabinet officials for withholding $239 million in congressional appropriations.
Members of the group’s board, which includes current and former Republican and Democratic lawmakers, said the organization filed the lawsuit on Wednesday afternoon as a last resort because it had been unable to get the State Department to restart the flow of money.
The group is also asking a court to prevent the government from withholding any future funds appropriated by Congress.
The group has had to put about 75 percent of its staff on unpaid leave, and about 1,200 grant recipients have received no money for projects since late January, after President Trump signed an executive order freezing all foreign aid.
In the lawsuit, filed in Federal District Court for the District of Columbia, the group argues that its money from Congress is not foreign aid and does not fall under the purview of the State Department, which manages the transfer of funds, or any other executive branch agency. Withholding the funding, the board members say, is illegal.
Peter Roskam, a former Republican congressman from Illinois who chairs the nonprofit, said the board voted on Tuesday to go to court.
“We’d be delighted to learn that this was just an oversight and someone just forgot to hit the send button,” he said in an interview on Wednesday, minutes before the lawsuit was filed. “But clearly that’s not what’s going on.”
The endowment’s plight is emblematic of the colossal shift in foreign policy that is taking place in the second Trump administration, as the president tries to move the government away from work aimed at strengthening values-based alliances, democracy and human rights toward a more nakedly transactional and nationalistic approach.
Mr. Trump tried to overturn the results of the 2020 election that he lost to Joseph R. Biden Jr., and the House of Representatives voted to impeach him for a second time because of his incitement of a riot at the Capitol against lawmakers certifying Mr. Biden’s win.
Some senior administration officials have adopted language, including phrases once common among progressive critics of the U.S. government, about the downside of American projects that seek to extend influence across societies abroad, calling such programs “nation-building” and attempts at “regime change.”
Representatives for the White House, the State Department and the Justice Department did not respond to requests for comment.
Elon Musk, the billionaire adviser to Mr. Trump, posted scathing criticism of the National Endowment for Democracy online last month, saying without providing evidence that it was “RIFE with CORRUPTION!!” “That evil organization needs to be dissolved,” he wrote, using the same conspiratorial language he has employed to describe the U.S. Agency for International Development, which Mr. Musk has helped dismantle.
Representative Elise Stefanik, a New York Republican who is Mr. Trump’s pick for ambassador to the United Nations, was on the National Endowment for Democracy board until she had to step down to prepare for Senate confirmation for her new job. Senator Todd Young, Republican of Indiana, is currently on the board.
Mr. Trump’s “America First” policy has also been brought into sharp relief in recent weeks by his criticism of democratic Ukraine in its defensive fight against Russia; his imposing of high tariffs on two allies, Canada and Mexico; his insistence on taking mineral-rich Greenland from Denmark, another ally; and his decision to cut off almost all U.S. foreign aid, which strategists have seen as an important component of American soft power.
The grants the National Endowment for Democracy gives out are focused on promoting democracy, free speech and religious freedoms in more than 100 countries and territories, including ones that the first Trump administration and the Biden administration considered rivals or adversaries — China, Russia, Belarus, Iran, North Korea, Venezuela and Cuba.
The grants fund projects such as the development of software that allows citizens to view banned websites and efforts to support independent journalism.
One recipient, China Labor Watch, a New York-based group with overseas offices, monitors the coerced labor and trafficking of Chinese workers. Its founder, Li Qiang, said in an interview that he had not received $150,000 of National Endowment for Democracy funds he had been expecting this year, and that most funding directly from the State Department was still frozen. He has had to lay off workers or put them on unpaid leave.
Mel Martinez, a former Republican senator representing Florida, said the Trump administration’s unwillingness to release funding for organizations that support overseas dissidents was an affront to exiles from Cuba, Nicaragua and Venezuela. “That entire group of people are politically active,” he said. “Many have been strong supporters of the president.”
In Venezuela, National Endowment for Democracy grants support independent groups that monitor elections and help provide legal defense to dissidents targeted by the autocratic government.
Authoritarian governments, including those of China and Russia, have denounced the work of the endowment over many years.
The lawsuit noted that the sudden halt in funding further endangers grant recipients living under a hostile government: “The freezing of the endowment’s funds poses special risk to partners operating in highly authoritarian contexts, as the sudden interruption in support may expose their operations and staff as endowment grantees.”
The group traces its origins to a speech by President Ronald Reagan to the British Parliament in 1982. He vowed that “the march of freedom and democracy” would “leave Marxism-Leninism on the ash-heap of history.” Congress passed a law establishing the National Endowment for Democracy the following year.
The endowment gives funding to several sister nonprofits, notably the International Republican Institute and the National Democratic Institute. Those groups are also ending programs because of the funding freeze. Several Senate allies of Mr. Trump, including Tom Cotton of Arkansas and Dan Sullivan of Alaska, sit on the International Republican Institute board.
Secretary of State Marco Rubio, a defendant in the lawsuit, is a former board member.
The Republican group’s website says it has had to disable its operations to save on expenses, but a page aims to remind people of the work that it does: “Dictators are afraid of their own people. Helping citizens have a voice in their country is at the heart of what I.R.I. does.”
Last November, a post on the group’s X social media account, which is now defunct, congratulated Mr. Rubio on being picked to be Mr. Trump’s secretary of state and called him a “leading champion of freedom.”
David Super, a professor who studies administrative law at Georgetown University, said the National Endowment for Democracy’s case had some similarities to a lawsuit filed by contracting companies for U.S.A.I.D. The Trump administration also froze that agency’s funds. In both cases, Mr. Super said, Congress had passed “clear, mandatory authorizing and appropriations statutes.” Withholding money from the endowment, he said, “is clearly violating both laws.”
