Impoundment and Rescissions

Presidents since Thomas Jefferson have occasionally declined to spend appropriated funds, but President Richard Nixon impounded billions of dollars for programs he opposed, from water pollution control to housing, setting off a constitutional clash. Congress responded with the Congressional Budget and Impoundment Control Act, signed on July 12, 1974, and the Supreme Court ruled in Train v. City of New York in 1975 that the administration had to release water pollution funds Congress required it to spend.

Under the Impoundment Control Act, a President who wants to cancel funds permanently must send Congress a rescission request, and may withhold the money for 45 days of continuous session while Congress considers it, but must release it if Congress does not approve. A President may also propose deferring spending temporarily for limited reasons, but not for policy disagreement. The Government Accountability Office monitors compliance and reports violations to Congress. In 1996 Congress gave the President a line-item veto, but the Supreme Court struck it down in Clinton v. City of New York in 1998.

In 2025 the administration withheld or delayed funds at many agencies, and GAO found several withholdings unlawful. Congress approved a $9 billion rescission of foreign aid and public broadcasting funds in July 2025, the first enacted rescission request in decades, and in late August the President sent a so-called pocket rescission of about $4.9 billion in foreign aid so close to the end of the fiscal year that the funds would expire before Congress could act, which the Supreme Court allowed to stand in an emergency order in September. Supporters said the President has authority to stop wasteful spending, while critics said the actions violated the Constitution's grant of the power of the purse to Congress.