Congress, when it enacts a new law, generally does not operate on an empty slate. The new law likely affects relationships, expectations, rights, investments, and other arrangements that already exist. In particular, the statute may interfere—either as its express purpose or incidental byproduct—with contracts entered into prior to its enactment. Such contracts may be between the United States and a private party ("public contracts") or solely between private parties ("private contracts"). The range of factual settings in which legislative interference with existing contracts may arise is unbounded, and the recompense sought by disappointed contract parties from the United States can be quite large. Perhaps the most high-profile such interference arose under the 1989 "savings and loan bailout statute." In that law, Congress forbade thrift institutions from counting "supervisory good will" toward minimum capital requirements, after such thrifts had acquired failing thrifts on the federal contractual promise that supervisory good will could be so used. This federal reversal resulted in numerous thrifts falling below minimum capital requirements and being liquidated. Thus far, the United States has paid out $2.28 billion on the roughly 125 claims filed by acquiring thrifts, out of $34.34 billion sought (two cases remain to be resolved). Separately but also related to the savings and loan crisis, a 1993 congressional enactment undercut agreements premised on acquiring thrift institutions being able to take tax deductions for certain losses, by eliminating those deductions. Other illustrations abound. A bill now in Congress would demand renegotiation of existing collective bargaining agreements between the Postal Service and its employees if such agreements contain a specified provision. Under the Troubled Asset Relief Program, the United States required Chrysler and General Motors to terminate certain dealership contracts as a condition of obtaining financial assistance. Following 9/11, Congress enacted the Aviation and Transportation Security Act under which security screening at U.S. airports was transferred from private to federal hands, indirectly negating security services contracts between private security services and airlines. In 1988 and 1990, Congress statutorily blocked prepayment of certain mortgage contracts on low-income housing, which prepayment had been expressly allowed in those contracts. And in 2008 amendments to the Medicare statutes, Congress terminated a number of equipment and supply contracts previously entered into by the United States. This report surveys the legal theories that may be invoked by aggrieved contract parties to obtain redress in these situations—that is, when new federal statutes interfere with contracts entered into pre-enactment. The effort is to give Congress some advance warning as to when such interferences, in bills before Congress, may result in legal challenge. For public contracts, the usual legal challenge is via a breach of contract claim, though claims that contract rights have been "taken," requiring compensation under the Fifth Amendment Takings Clause, are often joined. For private contracts, the breach theory is not available since by definition the United States is not a party to the contract. Here, takings claims predominate. One point warrants spotlighting. Breach, takings, and similar claims have no place if the federal statute applies only to contracts entered into after enactment . In the case of a statute whose application becomes clear only after regulations construing it are issued, claims based on contract interference have no place when the contract is entered into after the regulations take effect. In either case—post-enactment or post-regulation—the decisive principle is that parties are presumed to contract with knowledge of the law existing at the time. Congressional drafters can ensure a prospective-only interpretation of a statute by explicitly so stating in bill text. Absent an explicit statement, a prospective-only reading of a statute may be adopted, but is not guaranteed, under the general presumption that, lacking clear indication otherwise, statutes should be read to apply prospectively only. Protection of settled expectations is essential to ordered society, certainly to the conduct of business. Thus, contract law protects the settled expectations of parties to contracts. At the same time, government must have latitude to address new problems, even if that means interfering with settled expectations in existing contracts. Thus, contracts generally are said to confer no immunity against future legislation. Stated the Supreme Court: "Contracts, however express, cannot fetter the constitutional authority of Congress." Or as the Court also noted: "[P]arties by entering into contracts may not estop the legislature from enacting laws intended for the public good." However, the fact that Congress can legitimately thwart performance under existing contracts does not alter the fact that disappointed parties to those contracts may be able to obtain monetary relief under the breach and takings theories mentioned earlier. The need for balance between protecting settled expectations and allowing the government future legislative latitude also applies to contracts to which the government is a party. The right of the government to enter into contracts is not only an essential attribute of sovereignty, but also a practical necessity. The ability of the government to contract with private parties would be hindered if it were able to ignore its contractual commitments or seek to avoid contractual remedies simply because it is the sovereign. Thus, the Supreme Court admonishes, "[t]he United States are as much bound by their contracts as are individuals." At the same time, this report notes certain defenses to breach of contract that the United States has, but private parties do not. These defenses—chiefly, the sovereign act defense and unmistakability doctrine—are well known and arguably form part of the expectations of a private party who contracts with the government. Courts are generally reluctant to expand these defenses or otherwise allow the government to escape its contractual obligations simply because it is the sovereign. Conversely, when the government enters into a contract it is entitled to the same contractual protections as a private party. The protection of settled expectations in the takings arena also invokes this distinction between the government acting in a sovereign versus proprietary capacity. When acting in a sovereign capacity, government may be held to have taken property, requiring compensation. When entering into contracts, however, government is often seen as acting in a proprietary capacity, in which capacity the application of a takings theory in the event of contract breach is disfavored. To sue the United States for congressional interference with a contract right (public or private), the United States must have waived its sovereign immunity: the United States is immune from suit except as it consents to be sued. This waiver/consent precondition applies to both breach of contract claims and takings claims. The consent to suit has been given, in both cases, in the form of the Tucker Act and Little Tucker Act. Actually, these acts do two interconnected things: they waive the sovereign immunity of the United States against suits based on breach and takings, and they vest jurisdiction over such claims in a particular court. The Tucker Act gives the U.S. Court of Federal Claims jurisdiction over "claims" against the United States "founded either upon the Constitution, … or upon any express or implied contract with the United States …." The phrase "upon the Constitution" plainly includes takings claims against the United States—important not only for jurisdictional reasons, but because the Takings Clause of the Fifth Amendment is not construed to contain its own waiver of sovereign immunity. The waiver comes only from the Tucker Act. As for breach of contract actions, the phrase "upon any express or implied contract" states the Tucker Act's coverage of such actions explicitly. However, the phrase "implied contract" has been limited by case law to contracts implied in fact, excluding contracts implied in law. The Little Tucker Act gives federal district courts the same jurisdiction over breach and takings claims against the United States as the "big" Tucker Act gives to the Court of Federal Claims—with one difference. In Little Tucker Act suits, the amount in controversy may be no more than $10,000. Reading the two statutes together, those wishing to sue the United States over a legislative interference with contract must, if pursuing a breach or takings theory, sue in the Court of Federal Claims if seeking more than $10,000, but may sue in either district court or Court of Federal Claims if seeking $10,000 or less. Under either statute, the remedy available to the plaintiff is exclusively money. The "claims" referred to in the Tucker Act and Little Tucker Act are universally construed to mean monetary claims. Thus, in the case of public contracts, the plaintiff cannot compel the United States to perform its end of the contract ("specific performance") through a declaratory, injunctive, or mandamus remedy; it can only seek money ("damages") for breach. In the case of either public or private contracts, suits under a takings theory can only ask for the constitutionally promised "just compensation," not injunctive relief ordering the federal agency to rescind its allegedly contract-taking action. Also under either statute, any appeal taken, whether from the U.S. Court of Federal Claims or a federal district court, is to the U.S. Court of Appeals for the Federal Circuit. Due process claims cannot be heard in the Court of Federal Claims under the Tucker Act, or in federal district courts under the Little Tucker Act, but must instead go to a federal district court under federal question jurisdiction. Thus, appeal is to the appropriate regional circuit rather than the Federal Circuit. A "public contract," as noted, is a contract to which the United States is a party. These are contracts "where the sovereign steps off the throne and engages in purchase and sale of goods, lands, and services, transactions such as private parties, individuals, or corporations also engage in among themselves." However, the federal government's dual roles as sovereign and as contracting party often give rise to contracts that differ from traditional contracts between private parties. Types of public contracts include those that provide for (1) the purchase or sale of goods or services; (2) government conferring a benefit; (3) implementation of a statutory program; and (4) the lease or sale of resources on public lands.