Trump Administration Nears $400 Million TikTok Settlement to Fund D.C. Beautification Projects

The Trump administration is nearing an agreement with TikTok to resolve an ongoing lawsuit over alleged child privacy violations in exchange for the social media company paying $400 million that the administration plans to use to fund President Donald Trump's Washington, D.C., "beautification" projects.

The proposed settlement would end a 2024 lawsuit brought during the Biden administration that alleged that the then-Chinese-owned social media company engaged in "massive-scale invasions of children's privacy" by collecting extensive data from children without notifying or obtaining consent from parents.

Sources familiar with the discussions told ABC News the administration and TikTok are finalizing the terms, though the deal must still be approved by a vote of the TikTok board as soon as Friday. As part of the proposed settlement terms, which are not expected to include an admission of wrongdoing, TikTok would agree to pay the U.S. government $400 million.

The administration intends to use the money for some of the ongoing "beautification" projects in the nation's capital, with funds expected to be directed to either the Department of Interior, the Department of Commerce, or both.

While the Department of Justice regularly reaches settlements with private companies accused of wrongdoing, the proposed TikTok settlement marks a departure from the practice of using the settlement funds to resolve the alleged wrongdoing or compensate victims.

The Justice Department alleged that millions of children under the age of 13 were subjected to extensive data collection and excessive content meant for adults. The funds are instead set to directly support efforts to improve the appearance of the nation's capital.

Officials in the White House have had weekslong discussions about whether they could legally use the money to pay for a proposed massive 250-foot triumphal arch near Arlington National Cemetery.

“The proposed settlement would end a 2024 lawsuit brought during the Biden administration that alleged that the then-Chinese-owned social media company engaged in 'massive-scale invasions of children's privacy' by collecting extensive data from children without notifying or obtaining consent from parents." — ABC News, May 8, 2026 On Thursday evening, President Trump personally traveled down to the National Mall to tout his administration's "beautification" projects around the nation's capital. It accused the company of violating the Children's Online Privacy Protection Act by allowing children under the age of 13 to create and use accounts without parental consent and collecting extensive data from those children. The complaint alleged that by adhering to deficient policies, the company continued collecting children's personal information, showing them videos not intended for children, serving them ads, generating revenue from such ads, and allowing adults to directly communicate with them through the platform. TikTok pushed back against the claims, arguing it was going above and beyond federal law requirements. The case appears to have been stalled in pre-trial litigation, with a trial date recently set for May 2027. The proposed settlement would not detail specific projects the money would support.”

Trump Administration's D.C.

The administration's proposed 2027 budget includes surging more than $10 billion to form a "Presidential Capital Stewardship Program" to coordinate priority construction and beautification projects throughout the capital. The size of the proposed fund would dwarf the operating budget of the National Park Service, which the administration seeks to cut by more than a billion dollars to a total of $2.2 billion.

The budget would also reduce staffing at the agency, which manages more than 400 sites including 63 national parks, by approximately 3,000 employees. " Further complicating the matter is President Trump's direct role in helping to create the business venture that will pay out hundreds of millions for his D.C. projects.

Since taking office last year, Trump has fashioned a relationship with TikTok after the company was banned from operating unless it was sold to a U.S. owner. When the social media app briefly went dark in January 2025, Trump signed an executive order on his first day in office that allowed the company to continue operating in the United States while negotiations over a potential sale continued.

Following months of negotiations, TikTok earlier this year finalized a $14 billion deal creating an American venture partially owned by an Oracle affiliate, private equity firm Silver Lake, an Emirati investment firm, and others. ByteDance retains a minority stake in the American version of TikTok, which licenses its algorithm from the Chinese parent company.

“I am so happy to have helped in saving TikTok! It will now be owned by a group of Great American Patriots and Investors, the Biggest in the World, and will be an important Voice." — President Trump, January 2026 ABC News reported that the settlement monies would be used to fund Trump’s “beautification” projects in Washington.”