Impoundment and Congress's Power of the Purse

What Is Impoundment

Impoundment is when a president or a federal agency delays or refuses to spend money that Congress has approved by law. The Impoundment Control Act of 1974 allows it only in narrow cases. A president may briefly delay spending for set reasons, or ask Congress to cancel money, but the money must be spent unless Congress agrees to cancel it.

Impoundment is a question about who controls federal money after a spending bill becomes law. It covers the roughly one-quarter of the budget that Congress sets each year, not Social Security or Medicare, which run on their own laws (Bipartisan Policy Center).

Where the Impoundment Fights Stand

Congress approved one request to cancel money in 2025, and the administration let another $4.9 billion run out without a vote. It sent a second pocket rescission, for $810 million, on September 25, 2026. Here is where each piece stands.

Where Each Impoundment Fight Stands

As of September 26, 2026

• Impoundment Control Act Law

  In force since July 12, 1974. The administration calls it unconstitutional. The Supreme Court has never ruled on that question. (source)

• Rescissions Act of 2025 Law

  Canceled $9 billion of the $9.4 billion requested, mostly foreign aid and public broadcasting. Signed July 24, 2025. (source)

• August 2025 pocket rescission Ended, funds expired

  About $4.9 billion in foreign aid expired on September 30, 2025, without a vote in Congress. GAO says the tactic is illegal. (source)

• September 2026 pocket rescission Agency action, funds expire Sept. 30

  Sent to Congress late on September 25, 2026: $810 million, including $567 million in refugee resettlement funding at HHS. Senate Appropriations Chair Susan Collins called it a clear violation of the law. (source)

• Foreign aid grantees' lawsuit In litigation

  The Supreme Court paused an order to spend the money on September 26, 2025, pending appeal. We found no later ruling. (source)

• January 2025 federal funding freeze Blocked by a court

  The First Circuit largely upheld the order blocking the freeze on March 16, 2026, in a lawsuit brought by states. (source)

Source: GAO decisions; govinfo bill status; Supreme Court order in No. 25A269; Brennan Center; Congressional Research Service; Bloomberg Government

How the 45-Day Clock Works

The law gives a president two tools. A deferral delays spending, and it is allowed only for contingencies, for savings from changed needs or better efficiency, or where another law allows it. A deferral cannot run past the end of the fiscal year. A rescission is a request that Congress cancel money for good, for any reason, including policy (GAO).

A request to cancel money starts a 45-day clock, and the money must be spent if Congress does not act.

How a request to cancel federal money is supposed to work

1. 1 Day 1 The president sends a special message The message names each account, the amount, the reasons, and the expected effects. It goes to the House and Senate on the same day.
2. 2 Day 1 The budget office holds the money The Office of Management and Budget tells agencies to stop spending the amounts in the request.
3. 3 Within days GAO reviews the request The Government Accountability Office, which works for Congress, checks each proposal and reports whether it is classified correctly.
4. 4 Up to 45 days Congress votes or waits The appropriations committees get the first 25 days. A rescission bill can pass the Senate with 51 votes, because the law limits debate.
5. 5 Day 45 The money is canceled or released If Congress passes a bill, the money is gone. If it does not, the budget office must release the money for spending.

Sources: 2 U.S.C. 682-688; GAO, Impoundment Control Act resources; Bipartisan Policy Center. The 45 days count only days of continuous session, so long recesses stop the clock.

If an agency still holds the money after that, the Comptroller General, who runs GAO, can sue in federal court to force its release (GAO). That power has almost never been used. GAO sued once, in 1975, and dropped the case when the agency released the money (CRS).

Why the Impoundment Control Act Exists

Presidents had always held back some money, usually to save it when a job came in under budget. President Harry Truman refused to spend money for extra Air Force groups in 1949. In the early 1970s, President Richard Nixon went further and withheld money from programs he opposed. In 1971, Sen. Hubert Humphrey said the administration had frozen more than $10 billion “without informing the public or the Congress” (CRS).

The sharpest fight was over clean water. Congress passed the Federal Water Pollution Control Act Amendments on October 4, 1972. The president vetoed them on October 17, and Congress overrode the veto. On November 22, the president wrote to the head of the Environmental Protection Agency, Russell Train. He told him to allot no more than $2 billion of the $5 billion set for 1973 and no more than $3 billion of the $6 billion set for 1974, holding back $6 billion of the $11 billion (Train v. City of New York).

New York City sued. On February 18, 1975, the Supreme Court ruled unanimously that the law required the full amounts. Justice Byron White wrote that “we cannot believe that Congress at the last minute scuttled the entire effort by providing the Executive with the seemingly limitless power to withhold funds from allotment and obligation.” The Court decided the case on the water law’s words, not on the Constitution. By then, Congress had already passed the Impoundment Control Act, which President Nixon signed on July 12, 1974.

The power-of-the-purse fight runs from Nixon’s clean water order to the 2026 court rulings.

1. 1972 Clean water money withheld The president orders the EPA to hold back $6 billion of $11 billion Congress set for sewage plants.
2. 1974 Impoundment Control Act Congress sets the 45-day rule for cancellations and makes GAO its watchdog.
3. 1975 Train v. City of New York The Supreme Court rules unanimously that the EPA must allot the full amounts.
4. 1998 Line-item veto struck down In Clinton v. City of New York, the Court rules a president cannot cancel parts of a law on his own.
5. 2020 Ukraine aid decision GAO finds the budget office broke the law by holding back $214 million in military aid in 2019.
6. 2025 Rescissions and a pocket rescission Congress cancels $9 billion in July. In August, $4.9 billion is left to expire without a vote.
7. 2026 Funding freeze blocked The First Circuit largely upholds the order blocking the January 2025 freeze on federal aid.

Sources: Train v. City of New York, 420 U.S. 35 (1975); GAO decisions B-331564 and B-337805; CRS; Brennan Center.

Impoundment from Nixon to 2026: 1972: Clean water money withheld (The president orders the EPA to hold back $6 billion of $11 billion Congress set for sewage plants.). 1974: Impoundment Control Act (Congress sets the 45-day rule for cancellations and makes GAO its watchdog.). 1975: Train v. City of New York (The Supreme Court rules unanimously that the EPA must allot the full amounts.). 1998: Line-item veto struck down (In Clinton v. City of New York, the Court rules a president cannot cancel parts of a law on his own.). 2020: Ukraine aid decision (GAO finds the budget office broke the law by holding back $214 million in military aid in 2019.). 2025: Rescissions and a pocket rescission (Congress cancels $9 billion in July. In August, $4.9 billion is left to expire without a vote.). 2026: Funding freeze blocked (The First Circuit largely upholds the order blocking the January 2025 freeze on federal aid.).

1972 brought the clean water order. 1974 brought the law. 1975 brought the Supreme Court ruling in Train. 1998 ended the line-item veto, which Congress had given President Bill Clinton in 1996 (Conference Board). In 2020, GAO found that the budget office had illegally held $214 million in military aid to Ukraine the year before (GAO). 2025 and 2026 are covered below.

Congress Usually Says No to Cancellations

A request to cancel money is a proposal, and Congress has turned most of them down. From 1974 to early 2020, presidents asked Congress to cancel about $91 billion and got about $25 billion, or 28% (GAO). Presidents George W. Bush and Barack Obama sent no requests at all.

Congress approved about half of Bill Clinton’s requests to cancel money and none of Donald Trump’s first-term requests.

Share of each president's requested cancellations that Congress approved, by dollars

Category	Value
Ford	16%
Carter	37%
Reagan	36%
George H.W. Bush	18%
Clinton	54%
Trump, first term	0%

Source: GAO, Updated Rescission Statistics, Fiscal Years 1974-2020 (B-330828), Enclosure II, by administration. Resist Now calculation: dollars approved divided by dollars requested. Data run through February 28, 2020.

That record changed in 2025. The president asked Congress to cancel $9.4 billion, mostly foreign aid and money for public broadcasting, and Congress canceled $9 billion of it. The House passed the bill 214 to 212 on June 12, 2025, and the Senate passed an amended version 51 to 48 on July 17 (govinfo). The Congressional Research Service called it the first time since 1992 that a president used the law to get a cancellation bill passed (CRS).

Pocket Rescissions

A pocket rescission is a request to cancel money sent so late in the fiscal year that the money expires before Congress’s 45 days run out. If the budget office holds the money for the whole 45 days, the money is gone whether Congress votes or not.

On August 28, 2025, the president sent Congress a request to cancel about $4.9 billion in foreign aid. It reached the Senate on September 8. Every dollar in it was set to expire on September 30, but Congress’s 45 days would not end until October 23 (GAO). The White House said openly that it was using a pocket rescission (CRS).

Two-thirds of the $4.9 billion came from one foreign aid account.

GAO says pocket rescissions are illegal. In its words, “a pocket rescission essentially bypasses Congress’s power of the purse,” because the law says the money must be released if Congress does not act (GAO). The administration’s position is that the money lapses “because of the operation of law, rather than its repeal” (CRS).

Foreign aid grantees were already in court. A federal judge ordered the government to commit about $10.5 billion in aid before it expired, including the money in the August request. On September 26, 2025, the Supreme Court paused that order for the money in the request. The majority said the government had shown the Impoundment Control Act likely bars this kind of lawsuit, and that the order “should not be read as a final determination on the merits.” Justice Elena Kagan dissented, joined by Justices Sonia Sotomayor and Ketanji Brown Jackson: “At issue is the allocation of power between the Executive and Congress over the expenditure of public monies” (Supreme Court order).

The money expired four days later. No court has ruled on whether pocket rescissions are legal.

The administration did it again a year later. Late on September 25, 2026, it sent Congress a request to cancel $810 million, led by $567 million for refugee resettlement at the Department of Health and Human Services, with the fiscal year ending five days later. Senate Appropriations Chair Susan Collins, a Republican, said any effort to cancel appropriated money without Congress’s approval “is a clear violation of the law” (Bloomberg Government).

What GAO Found in 2025

GAO also rules on money held back without any request to Congress. Its list of recent impoundment decisions shows 11 in 2025 and 9 from 2010 through 2024 (GAO).

5

2

4

• Violation (5 decisions) EV charging plans, library agency, Head Start, NIH grants, FEMA prior-year aid
• Violation in part (2 decisions) Energy Department school program, FEMA 2025 aid
• No violation (4 decisions) Wind energy memo, water recycling pause, DHS ombudsman layoffs, farm conservation funds

Source: GAO, Impoundment Control Act decisions list, decisions dated May 22 to September 29, 2025. Resist Now tally.

The violations ranged widely. GAO found that the Transportation Department broke the law by suspending state plans for electric vehicle chargers (May 2025), and that the Health and Human Services Department held back Head Start money (July 2025) and National Institutes of Health grant money (August 2025). It found the same for federal emergency aid at FEMA (September 2025). GAO found no violation in four cases, including a pause in a water recycling program that it judged a programmatic delay rather than an impoundment.

GAO’s findings are legal opinions. It can report to Congress and sue, but it cannot order an agency to spend. Courts have not ruled on its power to sue: a 2002 suit it filed under a different law was dismissed because the court found GAO lacked standing (CRS).

The Honest Disagreement

The administration argues that the Impoundment Control Act is unconstitutional. Office of Management and Budget Director Russell Vought told senators in 2025, “The president ran on the notion that the Impoundment Control Act is unconstitutional. I agree with that.” He also said that early pauses in spending “are not impoundments. They are programmatic delays” (Conference Board). During the 2024 campaign, the president promised to use “long-recognized impoundment power to squeeze the bloated federal bureaucracy for massive savings.”

GAO and the lower courts that have considered the law see it differently. They point to the Constitution’s appropriations clause and to a 1969 Justice Department memo by William Rehnquist, later chief justice: “With respect to the suggestion that the President has a constitutional power to decline to spend appropriated funds, we must conclude that existence of such a broad power is supported by neither reason nor precedent” (Conference Board). GAO compares pocket rescissions to the line-item veto the Supreme Court struck down in 1998 (CRS).

The two sides also disagree about who can enforce the law. The Supreme Court’s September 2025 order suggested that private grantees likely cannot sue under the Impoundment Control Act. If that holds, enforcement falls to GAO and Congress.

What Impoundment Law Does Not Cover

• Most of the budget. Social Security, Medicare, and Medicaid run on permanent laws, so the 45-day process does not apply to them (Bipartisan Policy Center).
• A shutdown. When Congress misses a funding deadline, agencies stop because there is no money to spend, not because a president held it back. Our government shutdown explainer covers what stops and what keeps running.
• Every delay is not an impoundment. GAO found no violation in 4 of its 11 decisions in 2025. An agency may slow spending for real program reasons, such as reviewing applications, as long as the money is still spent before it expires.
• Congress can cancel money on its own. From 1974 to 2020, Congress started about $384 billion in cancellations itself, far more than presidents requested, often to fit spending under budget caps (GAO).
• The biggest questions are open. No court has decided whether pocket rescissions are legal or whether the law itself is constitutional.

Frequently Asked Questions

What does impoundment mean?

In federal budgeting, impoundment means the executive branch delays or refuses to spend money Congress approved. The word also has everyday meanings, such as a towed car or water held behind a dam.

Can the president cancel money Congress approved?

Not alone. A president can ask Congress to cancel it and hold the money for 45 days of session. If Congress does not pass a bill, the money must be spent. The one exception the administration claims, the pocket rescission, has never been ruled on by a court.

What does rescission mean in simple terms?

A rescission is a law that cancels money Congress already approved before it would otherwise expire. The president can request one, but only Congress can pass it.

Is a pocket rescission legal?

GAO says no, because the law requires the money to be released when Congress does not act. The administration says the money lapses on its expiration date. The Supreme Court let the 2025 pocket rescission stand for now without deciding the question.

What You Can Do

1. Ask your members of Congress where they stand on pocket rescissions. No court has settled whether they are legal, and Congress can settle it in law. Ask your representative and senators whether they would support that. Our letter-writing guide walks through it.

2. Check whether money for your community has been held back. GAO posts every impoundment decision on its Impoundment Control Act page. If a local program says its federal money stopped, ask your representative’s office to request a GAO review.

3. Watch the end of the fiscal year. Pocket rescissions depend on timing. A request to cancel money sent in late summer, when funds expire September 30, is the pattern to watch for.

4. Read how the other emergency powers work. Impoundment is one of several tools a president can use without Congress. Our explainers on national emergency powers and executive orders cover the others, and the War Powers Act explainer covers military force.