Trump Withheld Billions Congress Had Funded, and Its Auditor Again Found the Law Broken

Providers Serving Nearly 20,000 Children Reported Delays

Head Start gives low-income children education, nutrition, health and other services, with money Congress required the government to spend.¹ In the first months of President Donald Trump's second term, his administration held some of it back.¹ In a February 4, 2025 survey, providers serving nearly 20,000 children reported delays getting their federal money, and a complaint that April alleged that delays and poor communication about the payments had caused one local Head Start agency to shut down entirely.¹ Congress's auditor, the Government Accountability Office (GAO), cited both in the decision that found the withholding illegal.¹

The charge is that Trump's administration used its control of payments to override spending decisions Congress had enacted.²³ Trump signed the order freezing foreign aid himself, and a week later his Office of Management and Budget (OMB) told agencies to pause payments tied to his executive orders.³² GAO went on to find unlawful withholding in four programs, and a federal judge found that some freezes continued after he ordered them stopped.¹⁴⁵⁶⁷

The survey, by the National Head Start Association, found disruption at 45 or more grant recipients in 23 states, D.C. and Puerto Rico.¹ On July 23, 2025, GAO found that the Department of Health and Human Services (HHS) had violated the Impoundment Control Act, the law that governs when a president may delay or cancel spending Congress has approved, by withholding Head Start funds between January 20 and April 15.¹⁸⁹ GAO's analysis of HHS's reported data put payments at about 65 percent of the comparable 2024 amount, a drop of more than $825 million.¹

GAO B-337202, 'Department of Health and Human Services—Application of Impoundment Control Act to Availability of Head Start Program Funds'¹

Based on this evidence, we conclude that HHS violated the ICA.

HHS did not answer GAO's requests for information, so GAO could not independently confirm those amounts with the department.¹ GAO also said OMB had removed agency apportionment data from its public websites, contrary to its disclosure duty and GAO's statutory access authority.¹

HHS supplied no justification for withholding the money.¹ The administration sent Congress no special message, the formal notice the Act provides for, and none would have authorized this freeze: GAO held that the Head Start Act required the money to be spent, so the Impoundment Control Act did not permit withholding it at all.¹ GAO also said HHS had acted inconsistently with the Head Start Act's requirement for reasonable notice and an opportunity to respond before assistance is suspended, except in emergencies.¹

By June 9, disbursements had increased to amounts similar to the previous year's comparable period.¹ GAO still found the earlier withholding unlawful.¹

The Auditor Found the Same in Three More Programs

GAO found unlawful withholding in three more programs.⁴⁵⁶ Carrying out Trump's executive orders to end equity-related grants and bar funding that promoted gender ideology, the National Institutes of Health (NIH) terminated more than 1,800 grants between February and June 2025, according to HHS data examined by GAO.⁴ On August 5, 2025, GAO found that NIH's withholding of funds through grant terminations and interruptions to grant review and awards violated the Impoundment Control Act, without a special message to Congress.⁴ HHS told GAO it had lifted its communications pause and, from March 24 through June 30, 2025, scheduled or held more peer-review meetings than in the same period of 2024; GAO acknowledged the meetings but found no sufficient justification for the pause or evidence that it had been a permissible delay.⁴

On August 21, 2025, the Supreme Court sided with the administration in part: it stayed the judgments reinstating individual NIH grants, finding that the district court lacked jurisdiction over grant-based payment claims, and left in place the judgments vacating NIH's guidance.¹⁰ The Court also found that the government faced irreparable financial harm because grant money might not be recoverable if it ultimately won.¹⁰ That December, NIH agreed to review the plaintiffs' stalled applications without the challenged directives, the ACLU announced; the agreement promised review and decisions, not an award for every applicant.¹¹ In June 2026, Nature reported that political screening for 235 disfavored terms stalled hundreds of NIH applications after peer review.¹²

The other two findings came on October 7, 2026.⁵⁶ HHS, GAO found, unlawfully withheld Agency for Healthcare Research and Quality (AHRQ) funds after cutting grant staff, in a reorganization GAO traced to Trump's February 11, 2025 order directing agencies to prepare large-scale workforce reductions consistent with applicable law.⁵ AHRQ obligated $0 for grants in May 2025, and GAO rejected HHS's claim of unavoidable delay.⁵ GAO also found that the Environmental Protection Agency's (EPA) payment freeze and terminations of Community Change Grants, with over $1.5 billion obligated, violated the Act.⁶ Congress rescinded that program's unobligated balances on July 4, 2025; on July 21, 2026, the D.C. Circuit vacated the dismissal of the grantees' case and directed the district court to assess whether that rescission mooted their claims.⁶

He Signed the Foreign-Aid Freeze Himself

One freeze carries Trump's own signature.³ On January 20, 2025, he signed Executive Order 14169, directing an immediate pause in new foreign-development obligations and disbursements for a 90-day review of the programs' efficiency and consistency with his foreign policy.³ He assigned OMB enforcement through its control over the release of funds.³

Aid recipients sued, and Judge Amir Ali blocked the blanket freeze of congressionally appropriated funds.¹³ The freeze continued, and they repeatedly asked him to enforce the order.¹³ He declined to hold the government in contempt but ordered funds unfrozen for work completed before February 13; by February 26, he said, the government had had nearly two weeks to comply without apparently taking meaningful steps.¹³ On March 5, the Supreme Court denied the administration's request to vacate that payment order, with four justices dissenting.¹⁴ Because the payment deadline had passed, the Court directed Ali to clarify the government's obligations with regard to feasible compliance timelines; Alito's dissent questioned the district court's jurisdiction and the risk that $2 billion paid could not be recovered.¹⁴

Then the administration won.¹⁵ On September 26, 2025, the Supreme Court allowed it to withhold $4 billion that Trump had asked Congress to cancel that August and Congress had not canceled.¹⁵¹⁶ Congress had approved an earlier foreign-aid rescission in July 2025, canceling most of the funds Trump had proposed in that request.¹⁶ The Court's preliminary view was that the plaintiffs' requested remedies were likely unavailable and that the foreign-affairs harms of compelled spending outweighed the plaintiffs' asserted harms.¹⁵

In February 2026, the administration dismissed its appeal of the September 2025 injunction before a decision on the merits.¹⁶

On September 25, 2026, Ali dismissed the constitutional claim over withholding appropriations and two other claims.¹⁶ The rest of the lawsuit went forward: it still contests the withheld aid and the alleged abolition of the U.S. Agency for International Development (USAID).¹⁶ Ali's September 2026 opinion also recounted allegations that the funding decisions wasted food, supplies and medicine, and that ending USAID forced some organizations to close or shrink U.S. offices, move jobs overseas, cut pay and eliminate health insurance and benefits for American employees.¹⁶

By September 30, 2026, the government told Ali that USAID had committed $1.17 billion for development assistance and $1.35 billion for global health.¹⁷ The State Department had committed another $1.2 billion in the preceding days, and the government said it planned to commit all the aid appropriations at issue.¹⁷ These were commitments, and did not show that every recipient had been paid.¹⁷ The plaintiffs acknowledged that the recent actions could narrow their claims, and Ali kept the disputed appropriations available beyond their September 30 expiration while the case continued.¹⁷

The Wider Freeze Continued After a Judge Ordered It Stopped

On January 27, 2025, OMB directed agencies to pause obligations and payments tied to Trump's executive orders.² Its memo said federal appointees "have a duty to align Federal spending and action with the will of the American people as expressed through Presidential priorities."² It excluded Medicare, Social Security and assistance provided directly to individuals, and OMB clarified the next day that programs outside the listed executive orders were excluded.²¹⁸

OMB rescinded the memo on January 29.¹⁹ White House Press Secretary Karoline Leavitt announced that the withdrawal was "NOT a rescission of the federal funding freeze" and that Trump's funding orders would still be implemented.¹⁹¹⁸ Judge Loren AliKhan called the rescission an "empty gesture" and described the resulting "nationwide chaos and paralysis."¹⁹

Judges in Rhode Island and Washington entered orders against the freeze in January and February 2025.²⁰²¹¹⁹ On February 10, Judge John McConnell of Rhode Island granted the states' motion to enforce his restraining order and recorded what they had shown.⁷

State of New York v. Trump, Order (enforcement of the temporary restraining order)⁷

The States have presented evidence in this motion that the Defendants in some cases have continued to improperly freeze federal funds and refused to resume disbursement of appropriated federal funds.

McConnell said the continuing pauses violated the order's plain text, and required the government to restore frozen funding immediately.⁷

On appeal, the administration won partial relief.²²¹⁸ In March 2026, the First Circuit kept the ban on agency-wide freezes and affirmed the FEMA enforcement orders, but removed directions to pay specific grants and contracts because the trial court likely lacked authority to order those payments.²² In August, the D.C. Circuit ended the separate injunction against OMB's withdrawn memo because the memo dispute was likely over and the same blanket freeze unlikely to recur; it did not decide whether the freeze was legal.¹⁸

Republicans Objected to the School Funding Hold

On the evening of June 30, 2025, the Education Department emailed states that it would not issue July 1 grant-award notices for several education programs until it completed its review.²³ The email, reproduced in the states' July 14 complaint, tied the review to the change in administrations and the President's priorities.²³ The states alleged that more than $6 billion was frozen, jeopardizing summer school, after-school programs and support for English learners.²³ They also alleged that local education agencies had already canceled summer programs for migratory children, and that a California adult-education project had terminated contracts and suspended services.²³

The objection that followed came from Trump's own party.²⁴ Ten Republican senators, including Shelley Moore Capito, Susan Collins and Mitch McConnell, wrote to OMB Director Russell Vought on July 16 urging release of formula funds in legislation Trump himself had signed into law.²⁴ They warned that withholding the funds would harm students, families and local economies, and said the hold contradicted Trump's goal of returning K-12 education to the states.²⁴ They shared Vought's concern about funding radical left-wing programs but said these funds instead supported established programs with bipartisan backing.²⁴

On July 25, Capito announced that all the remaining formula funding her letter had requested was unfrozen.²⁵ The hold ended, but only after schools had spent weeks planning around money they expected on July 1.²³²⁵

On September 17, 2026, Judge Allison Burroughs vacated OMB's executive-order conditions on the education-research apportionments at issue for funds expiring that September 30, finding them contrary to law and arbitrary and capricious; she rejected the separate claim about congressional explanatory statements and reserved the remaining claims.²⁶ On October 8, lead plaintiff NCLD reported that nearly all previously unavailable Institute of Education Sciences and Comprehensive Centers funding was released before September 30.²⁷

The administration did win at the Supreme Court over separate teacher-training grants, which the department had terminated because of their connection to diversity, equity and inclusion.²⁸ On April 4, 2025, the Court stayed an order restoring them because the district court likely lacked jurisdiction over the grant-payment claims; the stay did not decide whether the cancellations were lawful.²⁸ The majority found that the states could keep the programs running while litigating and recover withheld money later if they won, while the government risked being unable to recover payments.²⁸ Justice Elena Kagan disputed that account of harm: she said the states had consistently reported that losing the grants had already forced them to curtail teacher training.²⁸ On September 17, 2026, Judge Angel Kelley vacated the anti-DEI directive underlying the cuts as unlawful under the Administrative Procedure Act; her judgment addressed the directive, not individual grant payments.²⁹ Five days later, Judge Kymberly Evanson blocked the department's June plan to terminate protected school mental-health grants using new priorities or bypassing required procedures.³⁰

Eleven Billion Dollars Cut From Public Health

On March 24, 2025, HHS terminated $11 billion in public-health grants, effective immediately.³¹ The grants supported infectious-disease tracking, immunizations, emergency preparedness, mental-health and substance-use services, and public-health infrastructure.³²³¹

Judge Mary McElroy recorded damage that had already occurred.³¹ North Carolina's funding loss had halted mental-health professionals' work and ended a college substance-use recovery and mental-health program.³¹ Minnesota had canceled infection-control training grants for more than sixty skilled nursing facilities.³¹ In evidence she cited, Colorado projected losing all but one employee in its Immunization Program.³¹

The department said the pandemic's end made COVID-related grants unnecessary and asserted authority to spend within congressional limits.³¹ McElroy answered that Congress had already reviewed pandemic funding, rescinded some money and left these appropriations in place.³¹ On May 16, 2025, she granted a preliminary injunction requiring HHS to undo the terminations for the states that sued, finding those states likely to succeed in showing that HHS had usurped Congress's authority over the appropriations.³¹

HHS reported compliance with the restoration order, and Oregon's Department of Justice tracker records that the government voluntarily dismissed its appeal in July 2025.³³³⁴ On September 22, 2026, McElroy granted both sides' request to pause the lawsuit; the funding-restoration injunction remained in force during the pause.³⁵³³

In June 2026, NOTUS reported that a nine-step political review passing through Health Secretary Robert F. Kennedy Jr.'s office and requiring final White House OMB approval delayed HHS funding notices.³⁶ Even after some opened, the CDC had $630 million and federal mental-health agency SAMHSA $286 million pending.³⁶

The Strongest Defense, and the Limit It Meets

The administration's strongest defense is that a new president needs discretion to review programs, prevent waste and align spending with lawful priorities.²³¹³ In court, it invoked Article II discretion, and its pause orders included language limiting implementation to applicable law.¹³²³ That defense has a real legal foundation: not every delay violates the Impoundment Control Act.⁴ GAO's NIH decision described a review from Trump's first term that passed its test.⁴ In 2017, the Energy Department reviewed ARPA-E awards on a rolling basis and ultimately released nearly all the funds; its actions showed an intent to spend once the review ended.⁴

In rejecting a stay on February 26, Ali said the foreign-aid freeze resulted from a categorical order, not a specific finding of waste or fraud, and that the government had supplied only conclusory assertions, not evidence of waste or fraud.¹³ And where the 2017 review ended in spending, NIH eliminated existing funding commitments by terminating grants, and Head Start's spending law barred withholding its funds under the Impoundment Control Act.⁴¹ GAO found both withholdings unlawful.⁴¹

The Act, which Congress enacted in 1974, permits specified deferrals and allows a president to propose rescissions by sending a special message to Congress; permanent cancellation requires congressional action.³⁷⁸⁹ A policy disagreement does not itself supply one of the Act's permitted reasons for deferral.⁹ The Rhode Island court stated the rule plainly: if appropriations conflict with presidential priorities, "it must ask Congress, not act unilaterally."²⁰

On July 17, 2026, Judge Indira Talwani ruled that OMB's grant-termination clause did not authorize cancellations for priorities adopted after awards.³⁸ OMB had proposed that broader authority on May 29; Congress blocked issuing, finalizing or giving the rule effect through December 11, 2026.³⁹⁴⁰

The stated purpose of the pauses was review.²³ No figure in GAO's decisions or the foreign-aid rulings shows whether the freezes saved money or reduced waste, or whether Trump's review made foreign aid more efficient or better aligned with his foreign policy.^14131516 What they show is that Head Start's money was withheld with no justification given to GAO, and that the school funds were unfrozen after Republican senators said the hold contradicted Trump's goal.¹²⁴²⁵ NIH did carry out his objective of excluding categories of research by canceling grants; GAO found that the resulting withholding of funds violated the Impoundment Control Act.⁴

Taking Congress's Power Over the Money

The administration won significant court relief, and some funding was restored.^18281015251 Neither erased the earlier harm.¹³¹²³

The Constitution places spending authority in Congress and makes high crimes and misdemeanors grounds for removing a President.⁴¹ Hamilton described the impeachment standard in terms of "the abuse or violation of some public trust."⁴² Congress's power of the purse is one such trust: the President executes its funding laws, rather than replacing them with his own decisions.⁴¹¹

That is the charge. Trump's administration withheld funding outside the statutory process, and in some cases continued the freeze after a court ordered it stopped.²³⁷¹⁴ The harm reached children, researchers, schools and public-health programs.¹⁴²³³¹