President Donald Trump notified congressional leaders on Friday that his administration is moving to cancel almost $1 billion in spending previously approved by Congress. The White House identified $567 million in Department of Health and Human Services funds for refugee, asylee, and migrant services; $50 million for other immigrant aid programs; $70 million in international education grants; and $56 million for Housing and Urban Development programs among the targets. The administration stated the move is intended to eliminate wasteful spending that does not benefit U.S. citizens.
The maneuver, known as a "pocket rescission," involves the president submitting a request to claw back funds shortly before the end of the fiscal year. Under the Impoundment Control Act, a president can propose rescinding funds, which triggers a 45-day period during which the money is withheld while Congress considers the request. Because the current fiscal year ends on Wednesday, the administration argues that the funds will expire before the 45-day window concludes, effectively canceling them without a vote from lawmakers.
Lawmakers from both parties, including Sen. Susan Collins (R-ME), have characterized the action as illegal. Collins, who chairs the Senate Appropriations Committee, stated that the Office of Management and Budget intentionally withheld the funds for months to execute the cancellation. Rep. Rosa DeLauro (D-CT) and Sen. Patty Murray (D-WA) also criticized the move, with Murray calling it an "end run around Congress." The Government Accountability Office (GAO) has previously issued an opinion stating that the Impoundment Control Act does not permit the president to unilaterally shorten the availability of funds by transmitting proposals shortly before they expire.
For the organizations and schools that rely on these federal grants, the move means that funds previously signed into law will not be distributed. The GAO has noted that such maneuvers could effectively allow the executive branch to override the "power of the purse" granted to Congress under Article I of the Constitution. The administration maintains the authority to manage federal spending and prioritize programs that align with its policy objectives.
What happens next: The current fiscal year ends on Wednesday, September 30. Unless legal intervention occurs before the funds expire, the money will remain withheld and eventually lapse. Congressional leaders have expressed concern that this standoff could complicate negotiations to avoid a government shutdown, as the deadline for funding the government for fiscal year 2026 also falls on September 30. The Supreme Court has previously addressed a similar rescission regarding foreign aid but did not reach a final decision on the merits of the pocket rescission tactic.