White House budget office closely involved in Ukraine hold, new documents show

OMB and military aid to Ukraine. (Photo illustration: Yahoo News; photos: NurPhoto via Getty Images, AP (2), Getty Images)
OMB and military aid to Ukraine. (Photo illustration: Yahoo News; photos: NurPhoto via Getty Images, AP (2), Getty Images)

WASHINGTON – As debate continued over the rules of the impeachment trial of President on Monday night and into Tuesday morning, the administration released 192 pages of documents from the Office of Management and Budget on the withholding of aid intended for Ukraine throughout the summer of 2019. 

While heavily redacted, those documents appear to show political appointees taking an unusually intense interest in the matter, doing what they could to ensure that some $250 million appropriated by Congress would not move from Washington to Kyiv.

That funding hold, which ended abruptly in September, is at the heart of the impeachment inquiry begun by Democrats later that month. They charge that used the $400 million in military and non-military assistance as a means to pressure new Ukrainian president Volodymyr Zelensky into announcing investigations that could hurt the Democratic Party and its leading contender in the 2020 presidential election, former vice president Joe Biden.

The new documents were obtained through a Freedom of Information Act request by American Oversight, a watchdog organization that has been a frequent adversary of the administration. The release came as Democrats pressed for a Senate trial that would include both witness testimony and document production from the administration. So far, Senate Majority Leader Mitch McConnell has successfully resisted having to heed those calls.

In this image from video, Senate Majority Leader Mitch McConnell, R-Ky., speaks during the impeachment trial against President Donald Trump in the Senate at the U.S. Capitol in Washington, Wednesday, Jan. 22, 2020. (Photo: Senate Television via AP)

In this image from video, Senate Majority Leader Mitch McConnell, R-Ky., speaks during the impeachment trial against President Donald Trump in the Senate at the U.S. Capitol in Washington, Wednesday, Jan. 22, 2020. (Photo: Senate Television via AP)

In this image from video, Senate Majority Leader Mitch McConnell, R-Ky., speaks during the impeachment trial against President Donald in the Senate at the U.S. Capitol in Washington, Wednesday, Jan. 22, 2020. (Photo: Senate Television via AP)

The new documents from the budget office raise far more questions than they answer. They suggest that despite months of intense scrutiny, much remains unknown about how, exactly, the Ukraine pressure campaign was conducted—and by whom. That reality could bolster Democratic arguments that, absent a fuller process, Senators cannot possibly have enough information to rule on ’s fate.

“President ’s lawyers stood in the Senate on Tuesday arguing that documents are totally unnecessary for the impeachment trial, but these documents give lie to that entire position,” American Oversight executive director Austin Evers said in a statement. “Despite the Administration’s obstruction and the rhetoric at the trial, the public can now see even more evidence of the president’s corrupt scheme as it unfolded in real-time.”

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A spokeswoman for the Office of Management and Budget declined to discuss the new documents on the record.

Most of the exchanges either involve or were initiated by Michael Duffey, a former Republican operative from Wisconsin who was appointed by to head national security programs at the budget office. appointed Russell Vought, a conservative activist, to head the budget office after its prior director, Mick Mulvaney, became the acting White House chief of staff. 

Mulvaney, Vought and Duffey have all refused to testify before the impeachment inquiry. The new documents seem to show how heavily the latter two were involved in the Ukraine matter, though the exact nature of Mulvaney’s involvement is less clear. His one extended public comment on Ukraine, which came during a blustery and freewheeling Oct. 17 press conference at the White House, is widely seen as having been damaging to the president’s legal prospects.

Acting Office of Management and Budget (OMB) Director Russell Vought speaks with President Donald J. Trump during a signing ceremony for Executive Orders on transparency in Federal guidance and enforcement in the Roosevelt Room at the White House on Wednesday, Oct 09, 2019 in Washington, DC. (Photo: Jabin Botsford/The Washington Post via Getty Images)

Acting Office of Management and Budget (OMB) Director Russell Vought speaks with President Donald J. Trump during a signing ceremony for Executive Orders on transparency in Federal guidance and enforcement in the Roosevelt Room at the White House on Wednesday, Oct 09, 2019 in Washington, DC. (Photo: Jabin Botsford/The Washington Post via Getty Images)

Acting Office of Management and Budget (OMB) Director Russell Vought speaks with President Donald J. during a signing ceremony for Executive Orders on transparency in Federal guidance and enforcement in the Roosevelt Room at the White House on Wednesday, Oct 09, 2019 in Washington, DC. (Photo: Jabin Botsford/The Washington Post via Getty Images)

“These heavily redacted documents show just how much the administration is hiding from the American people,” said Sam Berger, a vice president at the progressive Center for American Progress who was a top budget official at the Office of Management and Budget during the Obama presidency. “The Senate needs to see this evidence and talk to witnesses like Mike Duffey and Mick Mulvaney about ’s illegal funding hold.”

The very first email in the document batch is from Duffey to Vought. In that email, from June 19, Duffey forwarded Vought a news article about $250 million that had been apportioned to Ukraine.

“Looking into options and will follow-up,” Duffey wrote to Vought. 

At the time, the phone call between and Zelensky that is at the center of the impeachment inquiry was still more than a month away. Yet at the time, ’s personal lawyer, Rudy Giuliani, was already hard at work trying to push the Ukrainians to announce investigations into ’s political opponents.

Two days later, Duffey reached out to Mark Sandy, the senior career budget officer for national security matters. Under normal circumstances, he would approve the flow of congressionally apportioned funds without much internal budget-office friction.

“[C]an you give a ring when you break free?” Duffey wrote to Sandy in June 19. 

Six months later, Sandy would testify that Duffey and other political appointees failed to provide adequate grounds for not releasing the aid, and that their actions appeared to be motivated by politics, not policy.

Duffey again reached out to Sandy on July 22, in an email whose subject was “Reprogramming Approval.” The contents are redacted, but based on what Sandy has told investigators, Duffey was almost certainly interested in learning the mechanism by which aid was released—and withheld.

Mark Sandy, a career employee in the White House Office of Management and Budget, arrives at the Capitol to testify in the House Democrats' impeachment inquiry about President Donald Trump's effort to tie military aid for Ukraine to investigations of his political opponents, in Washington, Saturday, Nov. 16, 2019. (Photo: J. Scott Applewhite/AP)

Mark Sandy, a career employee in the White House Office of Management and Budget, arrives at the Capitol to testify in the House Democrats' impeachment inquiry about President Donald Trump's effort to tie military aid for Ukraine to investigations of his political opponents, in Washington, Saturday, Nov. 16, 2019. (Photo: J. Scott Applewhite/AP)

Mark Sandy, a career employee in the White House Office of Management and Budget, arrives at the Capitol to testify in the House Democrats' impeachment inquiry about President Donald 's effort to tie military aid for Ukraine to investigations of his political opponents, in Washington, Saturday, Nov. 16, 2019. (Photo: J. Scott Applewhite/AP)

The call between and Zelensky took place on July 25. In that call, asked Zelensky to investigate Joe Biden’s son, Hunter Biden, who had been a board member Burisma, a Ukrainian energy company with a history of corruption. 

Documents released on Tuesday, and earlier, as well as impeachment inquiry witness testimony, make clear that by the time the two leaders spoke, budget officials were already at work on executing the funding hold. The first “footnote”—that is, official budgetary hold—was sent by Sandy to Duffey on the morning of July 25, right around the time that and Zelensky spoke.

Later that day, the new emails show, Duffey and Paleotta met.

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Duffey would continue to keep the aid from moving in a series of nine “footnotes” issues throughout July, August and September. Each footnote acted as a brake on the funds. If those funds were not released by the end of the fiscal year on September 30, they would vanish altogether, and Congress would have to appropriate the military aid again.

Duffey appears to have had significant help from Mark Paoletta, the general counsel of the budget office. His name was put forth late last year as a potential “quarterback” of the administration’s impeachment defense efforts.

Michael P. Duffey poses for his official portrait in the Army portrait studio at the Pentagon in Arlington, Virginia, April 20, 2018. (Photo: William Pratt/U.S. Army )

Michael P. Duffey poses for his official portrait in the Army portrait studio at the Pentagon in Arlington, Virginia, April 20, 2018. (Photo: William Pratt/U.S. Army )

Michael P. Duffey poses for his official portrait in the Army portrait studio at the Pentagon in Arlington, Virginia, April 20, 2018. (Photo: William Pratt/U.S. Army )

The prospect of a protracted delay clearly had Pentagon officials worried, especially since a top Defense Department official had already certified in May that Ukraine had met anti-corruption requirements. That left Elaine McCusker, the Pentagon’s comptroller, pushing throughout the summer for the money to be released, only to have her regular queries met with polite intransigence from Duffey. 

“Elaine - no movement on Ukraine,” one typical email from Duffey to McCusker reads. “Footnote forthcoming to continue hold through Friday.”

At one point, a top Pentagon official, Kathryn Wheelbarger, attempted to get involved, scheduling a call with Duffey for Aug. 15. For reasons that are not explained in the documents released on Tuesday, that call was cancelled.

So the footnotes continued, with Duffey working closely with Paoletta, Sandy and other budget office officials.

“Is the footnote in place?” Paoletta asked on August 20.

Duffey’s response came nine minutes later: “Yes.”

Just how involved or aware the White House was of the continuing holds is unclear. But at least one email lists among its recipients Amy Swonger, a top legislative aide in the White House. Swonger worked closely with Brett Kavanaugh during his contentious Supreme Court confirmation fight. She had previously worked for Mitch McConnell, the Senate Majority Leader now orchestrating the impeachment trial of President .

The hold so alarmed Pentagon officials—who wanted to help Ukraine defend itself against Russia—that the Defense Department general counsel, Edwin Castle, contacted Paoletta directly to discuss McCusker’s concerns with him. The contents of Castle’s email, sent on Aug. 22, are redacted.

Elaine A. McCusker testifies before the United States Senate Armed Services Committee on her nomination as Principal Deputy Under Secretary of Defense (Comptroller) on Capitol Hill in Washington, DC on May 9, 2017. (Photo: Ron Sachs/CNP via ZUMA Wire)

Elaine A. McCusker testifies before the United States Senate Armed Services Committee on her nomination as Principal Deputy Under Secretary of Defense (Comptroller) on Capitol Hill in Washington, DC on May 9, 2017. (Photo: Ron Sachs/CNP via ZUMA Wire)

Elaine A. McCusker testifies before the United States Senate Armed Services Committee on her nomination as Principal Deputy Under Secretary of Defense (Comptroller) on Capitol Hill in Washington, DC on May 9, 2017. (Photo: Ron Sachs/CNP via ZUMA Wire)

Yahoo News previously reported that the Department of Defense was prepared to rule the holds orchestrated by Vought, Duffey and Paoletta illegal, only to be told that a direct presidential order made them legal.

A report released last week by the Government Accountability Office, however, said that had no authority to withhold those funds. “Faithful execution of the law does not permit the President to substitute his own policy priorities for those that Congress has enacted into law,” the report said.

Democrats have said that the report bolsters their case against , calling it a “bombshell.” Republicans maintain that he did nothing wrong, and that the report is inconsequential.

By the time that Castle reached out to Paoletta, an intelligence community official had already filed a whistleblower complaint about ’s phone call with Zelensky. Congress was notified of the complaint on Sept. 9, with intelligence community inspector general Michael Atkinson describing “a serious or flagrant problem, abuse, violation of the law.”

News reports had also started to emerge by late August about the Ukraine hold. Accordingly, the 192-page trove made public on Tuesday shows that, starting in late August, journalists began to ask OMB spokeswoman Rachel Semmel about why the appropriated money had not yet been disbursed. 

In early September, members of Congress also started to ask questions about the funds. Around this time, the email record begins to include James Braid, a budget office official who acts as a liaison to Congress on appropriations matters. He previously worked for the conservative Freedom Caucus in the House of Representatives.

At 3:45 am in the morning of Sept. 11, Duffey wrote to McCusker to tell her of a new footnote. But that evening, he informed her that he would “immediately release” all Ukraine funding. He did not explain why he was doing so.

By this time, the White House was aware of the whistleblower complaint, and its potentially disastrous ramifications for the presidency. Those worries were not unfounded. The House of Representatives launched an impeachment inquiry two weeks later.

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