Can Trump Cancel Government Funds Through Impoundment? What To Know As He Pauses All Federal Assistance
Key Facts
Trump has long suggested he wants to halt federal spending that Congress has authorized—known as impoundment—saying in a 2023 campaign video he wants to use impoundment “to squeeze the bloated federal bureaucracy for massive savings.”
His Office of Management and Budget issued a memo Monday ordering a “temporary pause” of all “federal financial assistance programs”—excluding payments to individuals like Social Security and Medicare—while agencies determine whether they are “consistent” with Trump’s policy aims.
The move comes after Trump already garnered controversy through an executive order halting federal spending appropriated through the Biden-era Inflation Reduction Act of 2022 and Infrastructure Investment and Jobs Act—which affected funding for infrastructure projects and climate change initiative—which the Office of Management and Budget then had to clarify only applies to funding for projects that specifically deal with Trump’s directives on increasing energy production, following widespread confusion and criticism.
Impoundment, the practice of presidents declining to spend money Congress has appropriated, has a long history, with multiple presidents dating back to Thomas Jefferson taking some action against federal spending.
After President Richard Nixon took impoundment to an extreme and canceled billions of dollars in spending, Congress passed the Impoundment Control Act, which says presidents can only use the impoundment power by submitting requests to Congress about funds they don’t want to disburse; lawmakers then have to approve those requests within 45 days, otherwise the funds are released.
Trump and his allies, including incoming Office of Management and Budget Director Russell Vought, have argued the Impoundment Control Act is unconstitutional and the president has expansive power to cancel congressionally authorized spending, going against the prevailing interpretation of federal law, which is that presidents cannot unilaterally cancel congressional funds.
Proponents of the Impoundment Control Act argue presidents have always had limited power to cancel federal spending and the act just clarified existing restrictions on presidents’ authority—a view that’s been backed up by the courts—while Trump and his allies argue presidents have broad power to withhold funds and the Impoundment Control Act unlawfully limited their constitutional authority.
What To Watch For
Democratic attorneys general—and possibly others—are likely to take legal action against Trump’s move to halt all federal assistance, which is set to take effect at 5 p.m. EST Tuesday. “My office will be taking imminent legal action against this administration's unconstitutional pause on federal funding,” New York Attorney General Letitia James said on X Tuesday morning. “We won't sit idly by while this administration harms our families.”
Is Trump’s Pause On Federal Assistance Illegal?
Legal experts suggested Monday Trump was violating the Impoundment Control Act with his administration’s decision to pause all federal aid, even if it’s only temporary. “This is clearly unlawful ... it certainly violates the Impoundment Control Act,” Georgetown University law professor David A. Super said on X Monday, while Stephen Vladeck, also a law professor at Georgetown, wrote the move is a “flagrant” violation of the impoundment law. Even if he only pauses the funds temporarily and doesn’t decline to spend them at all, Vladeck noted that, under the Impoundment Control Act, Trump can only defer giving out federal funds after he’s sent a request to Congress, which so far he hasn’t done yet. Monday’s memo also suggests the funding pause may apply to some funding that the president isn’t allowed to even try to impound under the law—funding that Congress has “required” or “mandated” to be spent—Vladeck pointed out.
Has Trump’s Administration Committed To Following The Impoundment Control Act?
So far, no. During his confirmation hearing before the Senate Budget Committee Wednesday, Vought, who will be tasked with disbursing federal funds if confirmed, denied Trump violated the Impoundment Control Act with his executive order halting some federal funding. Trump just paused the funding from being given out while his administration assesses the situation, Vought argued. That being said, Vought—a key architect of the controversial policy blueprint Project 2025—refused to explicitly say Trump’s administration would follow the Impoundment Control Act, which he said both he and Trump believe is unconstitutional. Trump officials will examine what can be done under the law, Vought said, but deflected when senators asked him whether he would follow the law as it now stands.
What Government Funding Could Trump Block?
Monday’s memo halting federal assistance likely applies to billions of dollars worth of funding, The Washington Post reports, including all federal grants given both domestically and internationally for things like education, medical research, nonprofits and state funding. That order comes after Trump’s executive order pausing infrastructure and climate change funding already left infrastructure projects across the country in limbo and affected a number of climate change initiatives implemented through the Biden-era Inflation Reduction Act. While it’s unclear what government funding will resume after the temporary pause and what Trump could try to get rid of permanently, the president could ultimately use impoundment to cut off funding that deals with any number of other major governmental issues, including money going toward disaster relief, education, state funding, foreign aid, social welfare programs or public health, among numerous other recipients.
How Could The Supreme Court Rule On Impoundment?
The dispute over the Impoundment Control Act and whether Trump can take action against congressionally approved funds could be ultimately decided by the Supreme Court—potentially within weeks, if legal action is taken over Monday’s memo as expected. The Supreme Court previously ruled against Nixon’s use of impoundment in the 1975 case Train v. City of New York, a dispute over Nixon withholding funding toward water treatment, though the court noted in its ruling that the Impoundment Control Act was passed while the case was pending and the court’s ruling didn’t impact it and wasn’t affected by it. In an opinion years later in the case Clinton v. City of New York, Justice Antonin Scalia wrote, “President Nixon, the Mahatma Gandhi of all impounders, asserted at a press conference in 1973 that his ‘constitutional right’ to impound appropriated funds was ‘absolutely clear.’ … Our decision two years later in Train v. City of New York proved him wrong.” (He noted Congress can authorize the president to cancel funds, as the Impoundment Control Act allows.) It remains to be seen how the current 6-3 conservative court could come down on the issue, however, though Vladeck wrote he’s skeptical even the current court—which includes three Trump appointees and has been deferential to the president in the past—would be willing to uphold Trump’s broad spending cuts. “It’s one thing to believe that the President must have unitary control of the executive branch,” Vladeck wrote, pointing to the court’s ruling giving Trump some legal immunity, but “it’s quite another to believe that such control extends to the right to refuse to spend any and all money Congress appropriates.”
Chief Critic
Democrats have staunchly criticized Trump’s efforts to oppose the Impoundment Control Act. Sen. Patty Murray, D-Wash., and Rep. Rose DeLauro, D-Conn., sent a letter to Trump’s Office of Management and Budget Monday expressing “extreme alarm” about the administration’s decision to halt spending, warning the order is “breathtaking, unprecedented, and will have devastating consequences across the country.” Democratic senators also lashed out at Vought during his confirmation hearings before two Senate committees as he refused to say the Trump administration would follow the law. “I am astonished and aghast that someone in this responsible a position would, in effect, say, that the president is above the law, and that the United States Supreme Court is entitled to their opinion, but mine should supersede it,” Sen. Richard Blumenthal, D-Conn., told Vought at a hearing. “I think our colleagues should be equally aghast, because I think this issue goes beyond Republican or Democrat … it’s whether the law of the land should prevail or maybe it’s up for grabs depending on what the president thinks.”
Crucial Quote
Mark Paoletta, an attorney whom Trump has appointed to serve as general counsel of the Office of Management and Budget, suggested on social media in November after Trump’s election that it is “time for [Trump] to reassert” his impoundment authority “to help stop the spending madness.” “Impound, Baby, Impound!” Paoletta, a longtime critic of the Impoundment Control Act, wrote.
Do Republican Senators Want Trump To Use The Impoundment Power?
Any moves Trump makes to curb Congress’ appropriations authority and usurp the Impoundment Control Act could be criticized even by Republican senators, though it still remains to be seen how many GOP lawmakers could push back against Trump. While Republicans in Congress have been largely deferential to Trump and his positions, taking a stand in favor of the president’s impoundment power could be politically disadvantageous, as it would weaken their own authority and mean that a future Democratic president could cancel funds for GOP priorities. Sen. Rand Paul, R-Ky., suggested during Vought’s confirmation hearing before the Senate Homeland Security Committee that he would oppose an expansive view of presidential impoundment powers, saying he was “sympathetic” to Democratic senators’ criticism of Vought’s refusal to follow the Impoundment Control Act. “I think if we appropriate something for a cause, that’s where it’s supposed to go,” Paul said, though he argued lawmakers right now give too much “latitude” to the president and need to do a better job of writing laws in a way that ensures presidents can’t exercise too much authority over funds. Sen. Lindsey Graham, R-S.C., also suggested Wednesday during Vought’s hearing before the Senate Budget Committee he could be opposed to the Trump nominee’s position, saying he has “concerns” about the issues over the Impoundment Control Act, but would elaborate on those concerns at a later time.
Will Elon Musk’s Doge Follow The Impoundment Control Act?
Trump has established the “Department of Government Efficiency” (DOGE) as part of his broader goal of reducing government spending, which will be run by billionaire Elon Musk. In an op-ed in the Wall Street Journal, Musk and former DOGE co-chair Vivek Ramaswamy railed against the Impoundment Control Act, writing, “Mr. Trump has previously suggested this statute is unconstitutional, and we believe the current Supreme Court would likely side with him on this question.” It still remains to be seen what actions DOGE will take on government spending and whether any of them will run afoul of the impoundment law, however, as Musk and Ramaswamy—who left DOGE to run for Ohio governor—noted many of their plans would target spending within the executive branch.
Key Background
Trump’s vow to use impoundment comes after the president attempted to use the power several times during his first term—most notably when he didn’t pay aid to Ukraine, which led to his first impeachment. Trump was impeached for allegedly using the congressionally approved aid to Ukraine as a bargaining chip when trying to get Ukraine to investigate President Joe Biden, then the former vice president, and his family. Though Trump ultimately released the aid to Ukraine, the saga was at the heart of his first impeachment, and the Government Accountability Office later released a decision stating Trump’s Office and Management and Budget violated the Impoundment Control Act by withholding the Ukraine aid. “Faithful execution of the law does not permit the President to substitute his own policy priorities for those that Congress has enacted into law,” the office wrote.
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