WASHINGTON: The U.S. State Department is considering providing $500 million to the Gaza Humanitarian Foundation (GHF), a new organization tasked with delivering aid to the war-devastated Gaza Strip. This potential move would deepen American involvement in an aid effort marked by chaos, violence, and serious operational challenges, according to multiple sources familiar with the matter, including former U.S. officials.
The funding, if approved, would come from the U.S. Agency for International Development (USAID), which is currently being integrated into the State Department. This plan has encountered opposition within U.S. government ranks, with some officials raising concerns about the deadly incidents occurring near GHF aid distribution sites and questioning the foundation’s effectiveness. GHF began distributing aid last week amid urgent warnings about famine risks facing Gaza’s 2.3 million residents after an 11- week Israeli blockade on aid deliveries.
The blockade was only partially lifted on May 19, allowing limited aid convoys into the enclave. Since starting operations, GHF has faced significant challenges including senior staff resignations and the need to pause aid distributions twice after overwhelming crowds at its distribution hubs. Humanitarian organizations, including the United Nations, have sharply criticized GHF for an alleged lack of neutrality. The foundation operates with private U.S. security and logistics firms that manage the transport and distribution of aid at what are called “secure distribution sites” inside Gaza. Efforts to verify who is currently financing GHF’s operations have been unsuccessful. Reuters reported that a Chicago-based private equity firm, McNally Capital, holds an “economic interest” in a for-profit U.S. contractor responsible for GHF’s logistics and security.
Both the U.S. administration under President Donald Trump and Israel deny direct financing of GHF, though both have pressured the U.N. and international aid agencies to collaborate with the foundation. The U.S. and Israeli governments justify their support for GHF by alleging that aid distributed through the long-established U.N. system had been diverted to Hamas, the Islamist group controlling Gaza. Hamas denies these accusations.
USAID itself is undergoing dramatic restructuring under President Trump’s “America First” agenda, with roughly 80% of its programs canceled and many staff facing termination. Despite this, acting deputy USAID Administrator Ken Jackson is reported to be a key proponent of the $500 million proposal for GHF, working alongside efforts to scale down the agency. Sources say Israel requested the U.S. funds to support GHF operations for a six-month period. However, some U.S. officials have voiced serious reservations about the plan due to overcrowding issues and violence near the GHF distribution hubs. There is also pressure for the involvement of experienced non-governmental organizations with proven track records in Gaza and other conflict zones to ensure proper aid delivery.
This approach is believed to be opposed by Israel, which prefers direct support for GHF. Hospital officials in Gaza report that between June 1 and 3, over 80 Palestinians were shot dead and hundreds more wounded near GHF aid points. Witnesses accused Israeli forces of causing the casualties. The Israeli military, however, states it fired warning shots on two separate occasions and claims soldiers opened fire on Palestinian “suspects” advancing towards their positions. Since its launch, GHF has established three aid hubs, but only two have remained operational in recent days due to the ongoing turmoil.
The State Department and GHF have not issued immediate comments on the reports. The situation highlights the complex and volatile nature of aid delivery in Gaza amid continued conflict, underscoring the difficulties in balancing humanitarian needs with security concerns and political considerations.