White House looks to freeze more agency funds — and expand executive power

Yahoo

21 hours ago

The Trump administration is working on a new effort to both weaken Congress' grip on the federal budget and freeze billions of dollars in spending at several government agencies, people familiar with the strategy told POLITICO's E&E News.
The strategy: order agencies to freeze the spending now — then ask Congress' approval, using a maneuver that allows the cuts to become permanent if lawmakers fail to act.
The move would ax billions of dollars beyond the $9.4 billion in White House-requested cuts, known as 'rescissions,' that the House approved Thursday. The Office of Management and Budget late last week directed several agencies to freeze upward of $30 billion in spending on a broad array of programs, according to agency emails and two people familiar with the plan.
The architect of the freeze directive, OMB Director Russ Vought, has long lamented the limits placed on the president's ability to direct federal spending. His latest gambit — first reported by E&E News — appears designed to test those boundaries.
The agencies targeted by the newest freeze include the Environmental Protection Agency, the National Oceanic and Atmospheric Administration, the National Science Foundation and the departments of Interior and Health and Human Services. E&E News granted anonymity to the two people familiar with the strategy so they could speak freely without fear of reprisal from the Trump administration.
OMB's targets include NSF research and education programs that operate using funding leftover from 2024. Also on the list are tens of millions of dollars for national park operations as well as more than $100 million in science spending at NASA, which includes climate research.
While the president has some measure of control over how federal agencies spend their money, the power of the purse lies primarily with Congress under the U.S. Constitution. Put another way: Lawmakers set the budget.
Vought is trying to turn that principle on its head.
The order to freeze some funding at more than a dozen agencies comes in advance of a budget spending 'deferrals' package that the White House plans to send Congress. Spending deferrals allow the executive branch to temporarily prevent authorized dollars from going out the door — but only if lawmakers sign off on the move.
Freezing the spending before making that request seems to fly in the face of Congress' constitutional power and the 1974 Impoundment Control Act, said Joseph Carlile, former associate director at OMB in the Biden administration.
'There is a right, a legal way, for the administration to rescind things and I guess they're pursuing this because they don't have their stuff together or don't care about the law,' said Carlile, who also worked previously on budgetary oversight on the House Appropriations Committee for 13 years.
'This is consistent with an administration that believes that they have broader powers around budget and spending than any other administration has ever been able to find,' Carlile added.
White House officials did not deny the new strategy when asked about it. Rather, they described it as a way to lock in spending cuts prescribed by the Department of Government Efficiency, a cost-cutting outfit championed by Trump donor and entrepreneur Elon Musk.
Yet the White House has worked to keep the effort quiet, said one person in the administration with direct knowledge of the strategy. The person said the White House directive was communicated largely to agencies over the phone to avoid creating a paper trail.
Vought has said repeatedly he disagrees with the impoundment act, a Nixon-era law that limits the president's ability to block spending for political reasons. Democrats and legal scholars have said Trump already has violated the law.
'We're not in love with the law,' Vought told CNN in an interview on June 1.
The separate $9.4 billion rescissions package that the House approved Thursday would permanently cut funding for NPR and PBS as well as foreign aid. Vought has said he expects to send more rescissions packages to Congress.
Vought's multipronged strategy also is likely to include a 'pocket rescissions' strategy, by which the White House intentionally runs out the clock near the Sept. 30 end of the fiscal year. If the president introduces a recissions package then, Congress has a limited time to act — and if it does not do so, the funds slated for elimination are automatically canceled.
The White House may use the pocket rescissions strategy if the $9.4 billion rescissions package does not pass both chambers of Congress, the administration person said. And it could pursue another pocket rescissions strategy centered on Labor Department spending.
The deferrals package is a third strategy — and it comes ahead of an expected congressional fight on lifting the debt ceiling before the end of the summer. It would essentially pause or significantly slow funding intentionally, until it can be crafted into a separate pocket rescissions package that can run down the clock and be made permanent.
Under the impoundment law, the White House can ask Congress to defer some of its budget spending authority "to provide for contingencies" or "to achieve savings" through efficiency gains. The White House is planning to argue that hitting the debt ceiling — a borrowing limit imposed and periodically raised by Congress — is such a contingency.
The nation is expected to reach the debt ceiling by the end of August.
The White House strategy is to delay or block funds now, then craft an additional rescissions package later in the year that would make such cuts permanent.
'OMB is hard at work making the DOGE cuts permanent using a wide range of tools we have at our disposal under the ICA [Impoundment Control Act] and within the President's authority— just like the first rescissions package that was sent up to the Hill this week,' OMB spokesperson Rachel Cauley said in a statement Monday. 'As a part of that process, we are constantly checking in with agencies to assess their unobligated balances.'
The latest effort may be more comprehensive than other blocks on federal funding that Vought has enacted, according to the person with direct knowledge of the move.
It could also be a 'trial balloon' to see whether the White House can unilaterally block future spending if Trump administration officials object, said another person at an agency that would be affected.
The move appears to be a significant escalation of Vought's efforts to test the boundaries of the Impoundment Control Act.
Vought's strategy is to rely on Section 1013 of the act, which grants the president the authority to freeze spending if the administration explains its actions to lawmakers. The act originally allowed one chamber of Congress to reject presidential deferrals, a power that courts rejected. As a result, the law was amended in 1987 to limit how long presidents could delay spending and under what conditions.
"It does not appear that any measures to disapprove a deferral have been considered since these amendments were made," the Congressional Research Service said in a February report on the impoundment law.
Vought has long argued that impounding some congressionally appropriated funding is constitutional, and he has said he wants the Supreme Court to validate what would be a significant weakening of congressional oversight of the federal budget.
The deferrals package the White House plans to send Congress would temporarily stop agencies from spending unobligated funds that remain at the end of the government's fiscal year on Sept. 30.
The broad-based deferrals package is highly unusual and could be part of his strategy to take his fight for greater executive power to the Supreme Court, said Philip Joyce, a professor at the University of Maryland's School of Public Policy and author of the book "The Congressional Budget Office: Honest Numbers, Power, and Policymaking."
'It is a novel approach, but I think in the end, they really want this to go to the Supreme Court,' Joyce said. 'They think they know how the Supreme Court is going to rule and once the Supreme Court opens the door, you know, it's kind of high noon for the separation of powers, which is what they want.'
Last week, OMB officials reached out to federal agencies to tell them to enact the spending freeze. Some agency officials were 'shocked' at the move, according to the administration official with direct knowledge of the plan.
The head of the National Science Foundation's budget office didn't know what to make of the directive, according to an email obtained by E&E News.
OMB is targeting the agency's research and education "accounts for a deferral package," NSF Budget Director Caitlyn Fife wrote last Friday in a note to top officials.
"I imagine you will all have questions, as do we," she said. "However we are immediately focused on pulling the funds back to ensure there are no further commitments or obligations."
An NSF official briefed on the spending freeze said offices relying on previous-year funding could see their "programs gutted." The official also predicted that if OMB's ploy succeeds, it will use deferrals to impound any congressionally directed spending the administration opposes.
That means the deferrals package strategy is likely the start of a significant and questionable push to expand executive power, said Carlile, the former OMB associate director.
He said the White House is essentially seeking to subvert the Constitution, which grants Congress spending authority, in such an extreme way that it threatens the nation's democratic structure.
'I think it upends a fundamental check and balance contemplated in our Constitution, and I don't understand how you subordinate Congress' power of the purse,' Carlile said.
Federal spending decisions are 'a deal between the executive and the legislative branch as institutions,' he added. 'And this all starts to unravel real quick if our budgetary framework really actually meant nothing.'