Amid USAID chaos, some humanitarian aid groups still aren't getting paid for lifesaving programs

Yahoo

02-04-2025

Edesia, a Rhode Island-based company that makes 'Plumpy'Nut' — packets of specially fortified and highly caloric peanut butter paste that saves the lives of severely malnourished babies and children — recently laid off 10% of its staff and even briefly paused production altogether for more than two weeks. Its CEO says they are having serious cash flow problems.
In Georgia, MANA Nutrition — a plant that produces similar 'Ready-to-Use Therapeutic Food,' or RUTF, packets of peanut butter — is leaning heavily on a line of credit from Bank of America to stay afloat for the time being, according to the company's founder.
Neither company has gotten paid by the US Agency for International Development in months — not since the last quarter of 2024.
'We are irreparably breaking a good system for no particular reason,' said Mark Moore, MANA's CEO and co-founder. 'And the impact on children — it's not at all dramatic to say that it's going to cost, at the very least, tens of thousands of lives.'
Edesia and MANA are among the scores of organizations grappling with canceled USAID contracts and little to no payment from the agency.
Both Edesia and MANA had their USAID contracts canceled before they were reinstated; for MANA, the cancellation was rescinded after Elon Musk personally weighed in. USAID, spurred by a court ruling, has begun issuing payments to other organizations — but those payments have been sporadic and minimal.
A federal judge has ordered USAID to pay out contracts and grants for all foreign assistance work done by mid-February. However, processing those payments has been slow going, and as of a March 27 court filing, more than 6,000 payments still needed to be processed.
The payment issues are among the many consequences of the Trump administration's efforts to abruptly shut down USAID and dramatically restructure foreign aid. The combination of the US government's sweeping freeze on foreign aid in late January, mass reductions in USAID staff, and thousands of contract terminations had already caused a significant impact — even for aid groups that are still supposed to be receiving money. Some of those same groups are owed money for work done before the freeze. The administration's move to shutter the agency by July is expected to further exacerbate the consequences.
The respective CEOs of Edesia and MANA Nutrition, Navyn Salem and Moore, told CNN in recent days that they can only guess when they might next get paid by USAID for the hundreds of thousands of boxes of lifesaving peanut butter paste they have already produced for the government agency. Their contacts at USAID — who, according to Salem and Moore, were initially fired or put on leave before eventually being brought back to work — can no longer provide them with any clear answers.
Other humanitarian organizations have similarly struggled to get answers as USAID has been gutted and their usual points of contacts are cut off from the internal systems. They fear this will only get worse as the vast majority of USAID personnel are expected to lose their jobs as the Trump administration moves to abolish the agency and fold it under the State Department. Fewer than 900 USAID direct-hire employees remained on the job as of March 21, according to another notice from the agency to Congress.
USAID said in a letter sent to Congress last week that it issued more than $250 million in payments between March 10 and March 21. However, sources who spoke to CNN said payments to aid groups have trickled in — if they have arrived at all. Several humanitarian officials told CNN they are still owed money for work they had completed.
One humanitarian official said their organization has received 'so little it's basically nothing.'
'They need to start issuing significant payments for existing lifesaving programs or organizations won't be able to continue,' they told CNN.
An association that represents humanitarian aid contractors has heard from the more than 70 groups they represent that they are getting paid in 'dribs and drabs,' a source familiar said.
Another humanitarian official said if they don't get paid, even for grants that have not been terminated, their organization cannot continue their programs.
'We might have to shut them down proactively simply because we cannot pay salaries or rent,' they told CNN.
Because of slow payment or funding cuts, many humanitarian organizations have had to furlough or lay off staff. Nearly 19,000 American jobs have been lost and more than 166,000 global jobs have been lost, according to USAID Stop Work.
A State Department spokesperson confirmed to CNN that 'between March 10 and March 21, 2025, USAID disbursed a total of over $257 million,' which 'equates to approximately $25 million per business day.'
'This work continues, as does streamlining the previously problematic and fragmented payment structure,' the spokesperson said.
Even if payments are made, it is not enough to fully stem the impact of USAID's dismantlement.
'Some of the damage is irreparable,' the first humanitarian official said. 'There are so many layers of impact. We can rehire, but trust with communities and some governments is broken.'
'No one will think of the US as a sure thing anymore,' they told CNN.
With the suspension of assistance and stop-work orders put in place in late January, efforts to combat infectious diseases like tuberculosis and to treat people, including children, with HIV/AIDS have been stymied. Local employees who worked with nonprofit organizations abroad may now be at risk in countries where affiliation with the US makes them a target.
Moore, the MANA CEO, said his organization is making contingency plans for USAID potentially never returning to the equation, including by reaching out directly to nongovernmental organizations that could partner in distributing his company's packets of peanut butter.
'We're scrounging hard to drum up partners who could go around the USAID system,' he said. 'It's a stopgap idea, but planning long term will be hard.'
CNN's Tierney Sneed contributed to this report.