HR-9795-119
Referred to the House Committee on the Judiciary.
Sponsored by Laura Gillen (D-NY)
What it does
This bill would require the U.S. Treasury to loan $3 billion per year to the United States Victims of State Sponsored Terrorism (USVSST) Fund for fiscal years 2027, 2028, and 2029 — a total of up to $9 billion. Each annual loan would be deposited within 30 days of the fiscal year's start and distributed in full to eligible claimants that same year. The loans would bear market-rate interest and would be repaid solely from future fines, penalties, and forfeitures collected from state sponsors of terrorism after the Fund terminates. The borrowing authority would expire on September 30, 2029.
Who benefits
American victims of state-sponsored terrorism and their families — including survivors and relatives of those killed in attacks such as the 1983 Beirut barracks bombing, the 1988 Pan Am Flight 103 bombing, and the September 11, 2001 attacks — who have pending or underpaid claims against the Fund. Attorneys and legal advocates representing claimants who would receive faster or larger distributions. Claimants who have waited years for full payment due to insufficient Fund balances.
Who is hurt
U.S. taxpayers who bear the risk if future terrorism-related forfeitures and penalties are insufficient to repay the $9 billion in loans plus interest. The general federal budget, which could absorb losses if repayment sources fall short. Future claimants or other federal programs that compete for forfeiture revenues. State sponsors of terrorism face increased financial pressure as forfeiture proceeds are earmarked for repayment rather than other uses.
Supporters argue
Supporters argue that thousands of terrorism victims and their families have waited decades for compensation they are legally owed, and that the Fund's current balance is far too small to meet outstanding judgments. They contend that borrowing against future terrorism-related forfeitures — rather than general appropriations — is a fiscally responsible mechanism that ensures victims are paid without adding to the deficit in the traditional sense, while honoring the government's moral and legal obligation to those harmed by foreign state-sponsored attacks.
Opponents argue
Opponents argue that the bill creates up to $9 billion in direct spending authority "without further appropriation," bypassing the normal congressional appropriations process and the oversight it provides. They contend that repayment depends entirely on uncertain future forfeiture revenues from state sponsors of terrorism — revenues that are unpredictable and historically modest — meaning taxpayers could ultimately bear the cost, and that Congress should instead fund the program through transparent, annually reviewed appropriations.
Constitutional context
The bill's mechanism — authorizing Treasury borrowing "without further appropriation" and classifying it as "direct spending authority" — raises questions under the Appropriations Clause (Art. I, §9, cl. 7), which requires that money be drawn from the Treasury only pursuant to appropriations made by law. Courts would likely assess whether this structure constitutes a sufficient congressional authorization or an improper end-run around the appropriations process. Post-Loper Bright (2024), any Treasury rulemaking on interest rates or repayment terms would face independent judicial scrutiny rather than deference.
Checks and balances
The Executive Branch (Treasury) gains authority to set loan interest rates and manage repayment; Congress retains oversight through the sunset clause expiring September 30, 2029, and through its control over future forfeiture revenue streams that fund repayment.
Historical precedent
The USVSST Fund was established by the Justice for United States Victims of State Sponsored Terrorism Act (2015) and has been amended multiple times to address funding shortfalls, including prior expansions of its revenue sources, making this a recurring legislative challenge rather than a novel mechanism.