Trump Withheld $4.9 Billion in Expiring Funds, Then Did It Again With $810 Million

Trump Sent the Requests; His Budget Office Held the Money

Five days before $810 million in federal funds was due to expire, President Donald J. Trump asked Congress to cancel it, and his budget office withheld it.¹² Congress's review period could not end until weeks after the deadline.² The request reached nearly all the money in a program that supports counseling for people trying to find or keep housing, including homeowners facing foreclosure.¹³ New Jersey Citizen Action told a court that losing its grants would require it to reduce or reallocate counseling capacity.⁴

It was the second time. A year earlier, Trump had used the same maneuver on a $4.9 billion foreign-aid package.⁵⁶ The charge is that he used withholding and expiration to bypass the congressional approval required for spending cancellations.⁷⁸⁹²

Trump sent both requests, and his White House announced the first as a cancellation.⁵¹⁸ His Office of Management and Budget (OMB) then issued instructions withholding the money from obligation, the government's commitment to spend.⁶²

Congress Can Cancel; a Presidential Request Is Not a Law

A President who wants to cancel money Congress has appropriated must ask Congress, in a special message required by the Impoundment Control Act of 1974.⁷ Congress then has 45 calendar days of continuous session to consider the request.¹⁰² Unless it completes a rescission bill, a law canceling the money, within that period, the money must be made available for obligation.⁷

Fixed-period appropriations carry a spending deadline, after which the government cannot make new obligations against them.¹⁰ A late request sets the two clocks against each other: hold the money while Congress considers the request, and the spending deadline can arrive before the review period ends.¹⁰ That maneuver is known as a pocket rescission.¹⁰

In 2026 the spending deadline was September 30; Congress's full review period could not end before November 9.² Roll Call reported that the House was in recess until after the elections, leaving no practical way for it to consider the request before the fiscal year ended.¹¹

A Judge Suspended the Deadline on $57.5 Million for Housing Counseling

The housing cut targeted nearly an entire program: $56.1 million of the $57.5 million allocation.¹³ Trump's message said past grantees included NGOs with discriminatory agendas and presented cancellation as eliminating unnecessary spending.¹

Ten organizations led by the National Urban League sued on September 29.⁴ Their complaint said the grant money was expected to go to approximately 175 counseling agencies, intermediary and state housing finance organizations, and training partners.⁴ New Jersey Citizen Action said the grants supported approximately nine percent of its budget.⁴ Housing Action Illinois said it had invested more than 300 staff hours preparing its application and that the rescission would impair its ability to distribute counseling funds.⁴ The complaint also alleged that funding delays before the September proposal had already forced providers to drain reserves, reduce services, defer expenditures and, in some cases, lay off staff or leave the federal program.⁴

On September 30, the day the money was due to lapse, Judge Jia M. Cobb suspended the deadline for the full $57.5 million until she ruled on preliminary relief.³ Expiration would make the funds unobtainable, she explained, a general principle the government did not dispute.³ The administration argued that she lacked authority to suspend the statutory deadline; Cobb rejected the objection and noted that the government had taken the opposite position in another case in the same district that day.³

Her order awarded no grants and left the rescission's legality undecided; a ruling was pending as of the October 10 docket update.³¹²

Eleven Accounts, and a Republican Chair Who Called It Unlawful

Housing counseling was one of 11 accounts in the message Trump sent the Speaker of the House and the President of the Senate on September 25, 2026.¹ Ten belonged to domestic departments, and the proposals totaled $810 million.¹ The largest, about $567 million from Refugee and Entrant Assistance, was more than two-thirds of the package.¹ Trump's message said the refugee account was overfunded because his border policies had reduced arrivals and that the cut would end taxpayer support for non-citizens.¹ Education and health research were among the other targets.¹

On September 29, the Government Accountability Office (GAO), Congress's auditing agency, reported that OMB had issued a reapportionment letter withholding the proposed amounts.² Its preliminary review found that all 11 accounts were due to expire at the end of the fiscal year, and it concluded that the proposals did not permit Trump to withhold the appropriations beyond that date.² That conclusion is a legal opinion from a legislative branch agency, not a court judgment.²

B-338788, review of the President's September 25, 2026 special message²

The President may not force the expiration of budget authority Congress has already enacted and did not rescind.

Senator Susan Collins, the Maine Republican who chairs the Senate Appropriations Committee, objected on the day Trump sent the message, saying that canceling appropriations without Congress's approval was "a clear violation of the law."¹³¹¹ Of OMB she said: "It does not get to decide which programs are worth funding."¹³ She also accused OMB of intentionally withholding the money for months to execute the cancellation, without supplying evidence for that allegation.¹³

Seven states, California among them, sued on September 30 over the package and other alleged withholdings; their docket through October 9 showed no emergency-relief request or merits ruling.¹⁴¹⁵ As of October 10, Roll Call had reported that the funding expired at the fiscal year's end but had given no final account-by-account accounting; the housing allocation remained protected by Cobb's order.¹⁶³

The White House Announced Cancellation Without Congress's Approval

The first use came a year earlier: on August 28, 2025, Trump sent the House 15 rescission proposals for the State Department, the U.S. Agency for International Development (USAID) and other international assistance programs.⁵⁶ They totaled $4.9 billion, and every account was due to expire at the end of fiscal year 2025.⁵⁶ GAO reported that Trump transmitted the message to the Senate eleven days later, although the Act required transmission to both chambers on the same day; GAO therefore calculated the review period from the Senate's later receipt.⁶

On August 29, the White House announced that Trump was deploying a pocket rescission, "cancelling $5 billion in foreign aid and international organization funding that violates the President’s America First priorities."⁸ It presented the move as a first in 50 years and said its goal was to cut spending it called wasteful and contrary to American interests.⁸ The announcement did not mention Congress's approval.⁸

OMB issued a letter withholding the money that same day, GAO later reported, while Congress's review period was scheduled to run until October 23.⁶ Collins objected that day too, calling the timing an apparent attempt to rescind appropriated funds without congressional approval.¹⁷ On September 12, GAO said the Act did not permit withholding past expiration.⁶ It also reported that neither State nor USAID answered its questions about whether their withholding matched the message; State acknowledged the inquiry but supplied no answers before September 11.⁶

A Judge Ordered Spending; the Supreme Court Put That Order on Hold

The administration's position did not depend on Congress accepting its request.¹⁸ In a suit brought by aid organizations, Judge Amir H. Ali recorded that position: "Counsel asserted that the agencies would not obligate the funds for which the President had proposed rescission regardless of whether Congress acted to rescind its appropriations."¹⁸

On September 3, 2025, Ali issued a preliminary injunction ordering the agencies, not Trump personally, to obligate roughly $10.5 billion in expiring aid before the deadline, except for money Congress rescinded by law.¹⁸¹⁹ Congressional action triggers a rescission, he reasoned; a presidential message does not.¹⁸

The administration won relief in the Supreme Court on September 26, 2025, four days before expiration.¹⁹ The Court stayed Ali's order only for the $4 billion covered by Trump's rescission request.¹⁹ The government told the Court it already planned to obligate the other $6.5 billion by September 30.¹⁹⁹ The other $900 million in the package, contributions to the United Nations and affiliated organizations, was outside the suit.⁹ The Court's preliminary view was that the Impoundment Control Act barred the aid groups' suit.¹⁹ It also said the asserted harm to the Executive's conduct of foreign affairs appeared to outweigh the potential harm to the plaintiffs.¹⁹ The order added: "This order should not be read as a final determination on the merits."¹⁹

Justices Elena Kagan, Sonia Sotomayor and Ketanji Brown Jackson dissented.¹⁹ Kagan wrote that the government had taken the opposite position in the appeals court the previous month: private groups could sue to enforce appropriations laws, even though they could not enforce the Impoundment Control Act itself.¹⁹ With expiration approaching, she warned, the stay would permanently keep the funds from their intended recipients.¹⁹ Roll Call later reported that the administration used the maneuver to cancel more than $4 billion in foreign aid without congressional approval.¹¹

The administration had secured the stay before expiration. In February 2026, before filing an opening brief, it obtained dismissal of its own appeals, abandoning its appellate challenge to Ali's ruling without a merits decision on his interpretation.¹⁹²⁰²¹

The Administration's Strongest Defense Has Text and History Behind It

The administration's strongest defense is that the statute permits late requests and withholding while Congress considers them.⁹ The Act sets no deadline within a fiscal year for sending a rescission message.⁷⁹ Congress expressly prohibited deferrals, a different kind of spending delay, from extending beyond the fiscal year, and wrote no matching provision for rescission proposals.²²²³ On OMB's reading, withholding can continue throughout the consideration period, and Congress's own expiration date, not a presidential repeal, ends the money's availability.⁹²³

There is history behind the defense.¹⁰²⁴ The Congressional Research Service (CRS) identified two earlier episodes that appear to resemble pocket rescissions, under Gerald Ford in 1975 and Jimmy Carter in 1977, and a possible third that was unclear.¹⁰ In Carter's case, Congress later enacted the rescission after the funds expired.¹⁰ GAO's 1975 report described the lapse as a major deficiency in the Act, not a presidential violation, and its older opinions pointed toward OMB's interpretation.²⁵²⁴

The government also defended the late timing of the 2025 message: proposing rescissions earlier, it said, would have defeated their purpose while an injunction required the funds to be made available, and it sent the message after the appeals court's decision lifting that injunction took effect on August 28.⁹ Ali rejected the premise, writing that neither of his earlier orders prevented Trump from proposing rescissions early enough to give Congress the full review period.¹⁸

The Act says it does not override other laws that require money to be spent.²⁶ The government argued that the 2025 foreign-aid appropriations did not specifically require spending, and GAO agreed that none of the 15 proposals conflicted with the provision.⁹⁶ CRS said Ali's broader reading appeared to differ from both OMB's and GAO's interpretations and was inconsistent with past practice.²⁷

GAO's answer is that permission to send a late request does not authorize withholding through expiration.²⁸²⁴ Its 2018 opinion expressly overruled its older opinions and concluded that money proposed for rescission must be released in time for prudent obligation before it expires, even when Congress's review period runs longer.²⁴ Later Supreme Court decisions and amendments to the Act, GAO said, had undercut its older reasoning, including its suggestion that Congress could create a one-house veto to reject a rescission.²⁴ It applied the release requirement to the 2025 package all the same.⁶

OMB Director Russell Vought answered GAO on September 29, 2026, by accusing it of partisanship and saying it made legal assessments according to whether Democrats held the White House.²⁹ He was right that GAO had reversed its older opinions, but the reversal was dated December 10, 2018, during Trump's own first term.²⁹²⁴ Vought's post offered no argument about the text of the 45-day rule.²⁹ Nor has GAO treated every disputed withholding as a violation: on October 7, 2026, it found none in a separate Education Department case.²⁸

Roll Call reported that White House officials did not consider themselves bound by GAO, a legislative branch agency.¹¹ GAO nevertheless published a specific legal objection before the administration repeated the maneuver.⁶¹ The earlier episodes CRS identified involved $10 million and $21 million.¹⁰ Trump's packages were $4.9 billion and $810 million.⁵¹

Constitutional Claims and Impeachment Precedents Have Limits

The government told the Supreme Court that the Executive had long questioned the constitutionality of limits on impoundment, but explicitly said those contentions were not at issue in its application.⁹ The 1969 Justice Department opinion it cited, signed by William H. Rehnquist, rejected a general constitutional power to decline to spend appropriated funds as unsupported by reason or precedent, while reserving a different question about presidential authority over war and foreign affairs.⁹³⁰ Most of Trump's 2026 package concerned domestic programs.¹

Congress also has a remedy short of impeachment: the Act authorizes the Comptroller General, who heads GAO, to sue for release of unlawfully withheld money after a required notice period.³¹ Article II's impeachment provision does not require exhausting other remedies first.³²

The impeachment precedents caution against equating a disputed legal interpretation with an impeachable offense.³³³⁴ In 1974, the House Judiciary Committee received a report on Nixon's impoundments but adopted no article on them.³³ Andrew Johnson's lawyers argued that mistaken legal interpretation did not justify impeachment, and the Senate acquitted him in 1868, one vote short of conviction.³⁴ Trump's administration had articulated its statutory reading in 2018, before the first package.²³

Why This Is a Case for Impeachment

The Constitution assigns Congress the power to enact appropriations and requires the President to faithfully execute the laws, including the spending duties those laws impose.³² Hamilton described impeachable offenses as abuses or violations of public trust, while warning that party strength could overwhelm judgments about guilt.³⁵

Trump's two packages are one method used twice: ask Congress to cancel money when its spending deadline falls before Congress's full review period, while the budget office withholds it.⁵⁶¹² The first targeted foreign aid, and Roll Call reported more than $4 billion of it canceled without Congress's approval.⁵¹¹ The second reached housing counseling, education and health research, after the legal objection was put before congressional leaders and the Republican appropriations chair objected.¹⁶¹⁷ As of October 10, 2026, $57.5 million for housing counseling remained available under a judge's order suspending its deadline.³¹²

The charge is an abuse of public power: using executive withholding and expiration to replace the congressional approval required for spending cancellations.⁷⁸⁹² A President's request is not Congress's consent.⁷