LISTEN TO ARTICLE 6:28 SHARE THIS ARTICLE Share Tweet Post Email

President Donald Trump says he lifted his freeze on aid to Ukraine on Sept. 11, but the State Department had quietly authorized releasing $141 million of the money several days earlier, according to five people familiar with the matter.

The State Department decision, which hasn’t been reported previously, stemmed from a legal finding made earlier in the year, and conveyed in a classified memorandum to Secretary of State Michael Pompeo. State Department lawyers found the White House Office of Management and Budget, and thus the president, had no legal standing to block spending of the Ukraine aid.

The White House freeze on assistance to Ukraine -- including a separate $250 million package of military aid from the Defense Department -- has become a central issue in House impeachment hearings, where witnesses say Trump ordered the assistance halted to force Ukraine to announce investigations into Joe Biden and other Democrats.

The words “investigation, Biden and Clinton” were to be required elements in a public announcement by Volodymyr Zelenskiy, the new Ukrainian president, to get the aid, State Department official George Kent testified in the Democratic-led impeachment probe. Ukraine ultimately didn’t make the announcement, and Trump says there was never a quid pro quo.

The freeze on funds Ukraine sought for its continuing war against Russia-backed separatists was opposed by many in the administration. Alexander Vindman, director of European affairs on the National Security Council, has testified that he understood Pompeo, then-National Security Advisor John Bolton and Defense Secretary Mark Esper all recommended releasing the funds in an Aug. 15 meeting with Trump.

The OMB has argued all along that the congressional notification by the State Department was only one step and it still had the power to hold the money after it was sent because of its authority to apportion -- or distribute -- the funds.

President Volodymyr Zelenskiy Photographer: Evgeniy Maloletka/Bloomberg

“At no point was this pause inappropriate, let alone illegal,” OMB spokeswoman Rachel Semmel said Saturday in an email.

But the State Department disagreed. Taylor, the envoy to Ukraine, said in his testimony that it was remarkable that the legal offices at the State and Defense departments had decided “they were going to move forward with this assistance anyway, OMB notwithstanding.”

QuickTake: Here’s the Story on Trump, Ukraine and Impeachment

The dispute over the aid is reflected in impeachment testimony from William Taylor, the temporary envoy to Ukraine. He told the inquiry that during the summer, State Department lawyers had advised that the aid could be spent regardless of the hold by the White House budget office.

The hold on funds provoked consternation, if not panic, at the State and Defense Departments because the law required them to spend the money by the end of the fiscal year on Sept. 30 or lose it. In reality, they had to get the aid moving through the system two weeks earlier -- around Sept. 15 -- because of a requirement for a two-week notification to Congress.

William Taylor Photographer: Zach Gibson/Bloomberg

The memo to Pompeo had determined that State had the authority to spend the money -- regardless of what Trump was saying through the OMB -- and would start the process by Sept. 7. But State officials were also wary of provoking a confrontation with OMB and Mick Mulvaney, the acting chief of staff who still leads the budget office, whose team argued they could block the money through a process known as apportionment.

By late August, bipartisan demands were building in Congress for release of the money -- and for an explanation of why it was being withheld.

Congressional appropriators were frustrated when their inquiry on Aug. 29 about the status of the State Department funds was greeted by silence. Days passed and on Sept. 9, when they asked again, the State Department’s Legislative Affairs office told them there was no hold on the $141 million, according to a person familiar with the matter.

What they didn’t know, according to one of the people, was that shortly before Sept. 9, Bolton had relayed a message to the State Department that the funding could go ahead. It’s not clear whether Bolton, who resigned from the job a week later, did so with Trump’s approval.

Read more: Bolton Ended Ukraine Meeting Over Probe Demand, Officials Say

Bolton’s handling of the funding struck officials in the White House as violating protocol and caught Mulvaney by surprise, according to another person familiar with the matter.

An OMB spokeswoman denied that characterization, saying Bolton had done no such thing and didn’t have the authority to do so. Nonetheless, Bolton at the time was waging a battle with senior-level OMB officials over the funding and opposed putting any conditions on the aid.

That may explain a cryptic letter that Bolton’s lawyer sent to Congress on Friday saying the former national security adviser has “new details” about the Ukraine matter that they don’t know about, without elaborating. Bolton has declined to testify against White House orders unless a judge rules he should and didn’t respond to multiple emails seeking comment.

Once he learned of the conditions, Bolton told the National Security Council’s senior director for Europe, Fiona Hill, that he didn’t want any part of “whatever drug deal” Mulvaney was “cooking up” with U.S. Ambassador to the European Union Gordon Sondland.

Fiona Hill Photographer: Zach Gibson/Bloomberg

Around the same time in early September, State Department officials in charge of the money communicated to senior leaders there that they were running out of time and needed to spend the money. They got “top-level guidance” to spend it, according to two of the people.

Notice to Congress that the $141 million was being released was sent early on Sept. 11, hours before Trump said he personally made the decision to lift the freeze. All of those events undermine Trump’s account.

Trump’s Account

Speaking to reporters last month, Trump said he was persuaded to release the money in a phone call that day with Republican Senator Rob Portman of Ohio.

“He called up, ‘Please let the money go,’” Trump said. “I said ‘Rob, I hate being the country that’s always giving money. He said, ‘You know what? But it’s important …’ I gave the money because Rob Portman and others called me and asked. But I don’t like to be the sucker, and European countries are helped far more than we are.”

Senator Rob Portman Photographer: Zach Gibson/Bloomberg

The OMB has argued all along that the congressional notification by the State Department was only one step and it still had the power to hold the money after it was sent because of its authority to apportion -- or distribute -- the funds.

“OMB has the statutory role to manage budget execution, consistent with the law and the President’s policy agenda,” Semmel said. “The State Department did not challenge the legality of the review with senior OMB leadership at any point. Nor does any other office, including NSC, have the authority to release such a funding hold if a policy review is underway.”

But the State Department disagreed. Taylor, the envoy to Ukraine, said in his testimony that it was remarkable that the legal offices at the State and Defense departments had decided “they were going to move forward with this assistance anyway, OMB notwithstanding.”

“I don’t know if they’ve ever done that before,” Taylor said. “This was a big decision for them.”

— With assistance by Jordan Fabian, and Jennifer Jacobs