The administration disclosed Friday evening that it intends to retract $810 million that Congress has already set aside. The proposal would remove $567 million from Health and Human Services programs that support refugees, asylees and other non-citizens, along with $28 million from HHS research. The plan also pares back funding for the Education Department's initiatives that serve immigrant students, as well as other line items.
The White House pointed to the Impoundment Control Act as the legal footing to submit rescission requests. According to the Government Accountability Office, the ICA bars the executive branch from delaying proposed rescissions until funds lapse when Congress has not signed off. Posting on X, Sen. Susan Collins, R-Maine, who leads the Senate Appropriations Committee, pushed back: "This is the most recent attempt by this Office of Management and Budget (OMB) to undermine Congress's Constitutional power of the purse," she wrote.
"The independent Government Accountability Office has concluded that pocket rescissions are unlawful and not permitted by the Impoundment Control Act," Collins added. "Any effort to rescind appropriated funds without congressional approval is a clear violation of the law." CNBC sought comment, but the White House and Collins' office did not reply right away.
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Roughly one year earlier, the Trump administration halted $4.9 billion in foreign aid that Congress had approved, using a pocket rescission. That episode marked the first time in roughly five decades that a president had attempted to use that authority. The tactic hinges on timing: a rescission request lands so late in the fiscal year that Congress's 45 day review window cannot be completed before the funds expire.
Budget reversals can change who gets paid and when, especially for local services tied to newcomer support and certain education programs. For investors, legal wrangling over spending tends to create pockets of uncertainty around health and education funding pipelines, which can ripple through contractors and nonprofits that rely on them.
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