When I first encountered the term “pocket rescission” earlier this month I did not rush to my pocket glossary of budget terms to find it. I knew it wouldn’t be there — at least not in my twentieth century edition. It has not yet seeped into everyday budgetary parlance.
However, both President Trump and Russell Vought, his director of the Office of Management and Budget think the 1974 Impoundment Control Act is unconstitutional. Pocket rescissions may be their best test case for luring the courts into making such a ruling.
In the meantime, Congress’s expedited ability to cancel funds it has previously appropriated through the regular recission process adds one more option to future presidential handbooks on how to circumvent Congress’s spending priorities.
The controversy is a subchapter in this month’s struggle over how to keep the government open and functioning beyond the Sept. 30 expiration of fiscal 2025. The betting in Congress is that it will have to rely on a continuing appropriations resolution to keep government running into the fall as the 12 regular appropriations bills wend their way through the process.
Trump would prefer a longer continuing resolution into next year to allow some of his new fiscal year initiatives to be tacked on. Most members recognize that such an ambitious plan would have no chance of attracting the bipartisan support needed in both chambers, given their slim GOP majorities.
The issue of pocket rescissions may seem peripheral or even irrelevant, given the big picture backdrop of a government teetering on the brink this month. But it actually has major significance, since it raises new questions and possibilities over who controls the government’s purse strings.
The Impoundment Control Act of 1974 allows presidents to submit proposed current fiscal year rescissions (funding cancellations) for a 45-day review period during which Congress may approve, disapprove or modify the request. If Congress does not act on the rescission proposals, the money must be released for its intended purposes.
A pocket rescission comes into the picture when the president proposes to rescind the money within 45 days of when the fiscal year expires — which is to say, any time between now and 11:59 p.m. on Sept. 30. Trump’s position is that, absent congressional action, a cancellation of previously appropriated funding is thereby baked into final budget totals. Congress, on the other hand, insists that it can still address the matter retroactively through the appropriations process.
The constitutionality of the Impoundment Control Act has never been challenged directly in the courts. However, in 1975, the Supreme Court came close. In its decision in Train v. New York City — which involved President Richard Nixon’s impoundment of water pollution control funds — the court held the impoundment was unconstitutional, but based its decision more on the statute’s language and not directly on the constitutionality of the president’s impoundment authority.
In 2018, the Government Accountability Office, an independent arm of Congress, issued a report saying a pocket rescission would be an illegal impoundment because it does not allow for prudent obligation before the amounts expire. In 2021, after talks with the Office of Management and Budget, the Government Accountability Office partially walked that finding back and called for amending the Impoundment Control Act to ensure consistency while still not allowing budget authority to be withheld beyond its expiration date.
Today, a situation is emerging that could go all the way to the Supreme Court for resolution. Trump, on Aug. 28, sent to the Hill a $5 billion rescission package for foreign aid programs and projects under the State Department and the U.S. Agency for International Development. A group of non-profit organizations to whom the money had been committed sued the government on the grounds that the pocket rescission was unconstitutional.
A federal appeals court judge for the District of Columbia ordered the president to unfreeze those and some $6 billion in other funds being withheld. Trump promptly petitioned the Supreme Court for emergency relief from the appeals court judge’s ruling. Chief Justice John Roberts agreed to partial relief by ordering the appellate court to lift its ruling on the $5 billion in foreign aid, pending full judicial process.
Viewed from this perspective, the pocket rescission issue is not a small-ball power play by the executive. Instead, it will lay the groundwork for validating presidential authority to unilaterally withhold congressionally appropriated funds at any time, in any amount, and for any reason.
Vought has long argued that, once the president has signed congressionally appropriated funds into law, he has complete discretion to use them or not, as he wishes. If this unitary executive theory prevails in the courts, it will give new meaning to the term, “checks and balances” — Congress writes the checks while the president controls the balances.
Don Wolfensberger is a 28-year congressional staff veteran, culminating as chief of staff of the House Rules Committee in 1995. He is author of, “Congress and the People: Deliberative Democracy on Trial” (2000), and, “Changing Cultures in Congress: From Fair Play to Power Plays” (2018).