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STATEMENT: Trump Administration Chaos Continues with Rescission of Illegal Memo Defunding Grants and Loans Across All of Government

Jan 29, 2025

WASHINGTON, DC – The Trump administration today rescinded its across-the-board federal funding freeze issued on Monday night. In response, Kyle Herrig, senior advisor to the Congressional Integrity Project, said the following:

“The White House backtracking on their across-the-board federal funding freeze is a win for democracy and a loss for Russ Vought. The immense pressure put on the Trump administration by the American people and their representatives in the Senate and House are the reason the White House stood down on this illegal directive. However, the Trump administration’s Day 1 Executive Order impounding funding remains in place, the administration still intends to illegally withhold funding American families and businesses rely on, and Americans deserve to know what programs Russ Vought intends to illegally cancel. The Senate must reject Russ Vought, the man who wants to utilize his power as OMB Director to pursue his extreme agenda while ignoring the laws passed by Congress when he deems fit. Today’s memo was a welcome step back from the Trump Administration, but Congress must remain vigilant in opposing ongoing efforts to undermine its constitutional authority and cause widespread harm to the American people.”

BACKGROUND ON RUSS VOUGHT’S DANGEROUS PLANS ON IMPOUNDMENTS:

Vought falsely contends that the Trump administration can unilaterally cancel spending appropriated by Congress, through a process known as impoundment. 

  • Vought has built an agenda for using impoundment and challenging the Constitution, allowing Trump to ignore the will of Congress. Vought’s Center for Renewing America and Project 2025 created the roadmap for the President to deploy impoundments and ignore laws passed by Congress without a vote.

  • Impoundment violates the Constitution. Article I, Section 9, Clause 7 of the Constitution (the Appropriations Clause) states: “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.” This clause is “the power or the purse” exclusively vested to Congress. It ensures Congress—as the representatives of the people—retains sole authority over federal spending decisions. The Framers gave this power to Congress to prevent unilateral control of public funds by the executive.

  • The Supreme Court has repeatedly ruled that the president lacks unilateral impoundment authority. In 1838, the Court held that unilateral presidential impoundment was incompatible with the Constitution. When President Nixon tried to use impoundment, the Court ruled that he did not have the authority. Conservative judicial heroes William Rehnquist and Antonin Scalia have both expressed that the Constitution does not provide the President with impoundment power.

  • The Impoundment Control Act (ICA) of 1974 allows the President to rescind or delay funds only if Congress approves. Enacted in response to abuses of impoundment by President Richard Nixon, and numerous defeats of his Administration in Court, the Impoundment Control Act created a process the President must follow to delay or cancel funding – only with Congress’s approval. Without such approval, funds must be released. Failure to obligate appropriated funds as required violates the law.

  • Under no circumstance can the Administration put a hold on funding for policy reasons, which is what the Administration is explicitly saying it is trying to do. The GAO found in the case of the Ukraine impoundment that: “Faithful execution of the law does not permit the President to substitute his own policy priorities for those that Congress has enacted into law. OMB withheld funds for a policy reason, which is not permitted under the Impoundment Control Act (ICA). The withholding was not a programmatic delay. Therefore, we conclude that OMB violated the ICA.”

  • The Administration has never had the authority to unilaterally withhold spending from laws enacted by Congress – a fact supported by the Supreme Court, the Department of Justice and the Government Accountability Office. Unilateral, executive impoundment has always been illegal. The ICA did not take impoundment powers away because the authority never existed in the first place.

Both chambers must now decide: does Congress control the power of the purse, or will they cede control to Trump and give him the power to disregard spending laws?

  • Impoundment is the direct seizure of one of Congress’s primary constitutional powers, the power of the purse. With the Vought nomination and in the coming months, we will see how many true institutionalists are left in the United States Congress. Any Member – House or Senate – who takes their oath of office seriously should reject this proposed usurpation of their constitutional powers.
  • Appropriations reflect the priorities of the American people as expressed through their elected representatives in Congress. Presidential impoundment undermines public trust and accountability because it is an act to disregard the law. Presidents have many powers, but they do not have the power to ignore laws, including spending laws.