White House Cancels $810 Million in Funds Congress Already Approved

The White House moved late Friday to cancel $810 million in federal spending that Congress had already approved, using a rarely invoked budget maneuver known as a "pocket rescission" that the Government Accountability Office has repeatedly said is illegal. The action, detailed in a White House statement issued September 25, targets refugee resettlement programs, housing counseling grants, international education fellowships and a handful of smaller federal offices the administration has long sought to shrink.

It is the second time in just over a year that President Trump's budget office has used the tactic, and it lands with Congress at its least able to respond: the request arrived five days before the September 30 end of the fiscal year, when the appropriated money would expire regardless of what lawmakers do.

A Second Pocket Rescission in a Year

A pocket rescission works by exploiting the timing rules of the 1974 Impoundment Control Act, which ordinarily gives Congress 45 days of continuous session to act on a president's request to cancel appropriated funds. When a president submits that request with fewer than 45 days left before the money's expiration date, lawmakers cannot finish the review in time, and the funds simply lapse — with or without a congressional vote. Office of Management and Budget Director Russell Vought used the same approach in August 2025 to cancel $4.9 billion in foreign aid, including roughly $3.2 billion earmarked for the U.S. Agency for International Development. The Supreme Court allowed most of that earlier freeze to stand on a procedural stay last September, but it never ruled on whether pocket rescissions themselves are lawful, leaving the underlying question open heading into this latest round.

The Government Accountability Office, the nonpartisan congressional watchdog, has concluded in successive opinions that the maneuver has no basis in the statute — a position also cited in ABC News' report on the funding freeze. As GAO's own legal analysis puts it, "a pocket rescission is illegal" under the Impoundment Control Act, which the agency says gives the executive branch no authority to shorten the period during which appropriated money remains available simply by running out the clock — a reading that GAO argues would let a president unilaterally rewrite spending decisions Congress made through the normal legislative process.

Where the Money Was Going

The $810 million spans several agencies. The largest piece, $567 million, comes from Department of Health and Human Services funding for refugee and asylee resettlement services, money the administration argues is no longer needed given a sharp drop in border crossings. Another $56 million would have gone to HUD-funded housing counseling nonprofits, including groups such as UnidosUS and the National Urban League. Roughly $70 million in international education and exchange grants, $25 million for migrant student education programs at the Department of Education, and $15 million for the Justice Department's Community Relations Service round out most of the rest, alongside smaller cuts to the Minority Business Development Agency and HHS's Office of Minority Health. The White House described the targeted grants as funding "ideologically driven" projects, citing examples including diversity trainings and research grants tied to gender-affirming care studies, according to details reported by CBS News' rundown of the rescission list.

A Fight Over the Power of the Purse

The administration's legal position rests on an aggressive reading of impoundment authority: that a president may propose rescissions at any point in the fiscal year, and that Congress's failure to act within the shortened window — even one it had no realistic chance to use — means the funds simply expire. Senate Appropriations Committee Chair Susan Collins, a Republican who has generally sought a working relationship with the White House on spending bills, rejected that framing outright, saying the administration's own budget office had sat on the funds for months specifically to engineer this outcome. Her office said Collins would "work with my colleagues to address these illegal actions," a notable break from a senator in the president's own party who controls one of the chamber's most powerful gavels.

Reaction on Capitol Hill

Democrats were considerably sharper. Senate Minority Leader Chuck Schumer said the administration was "illegally stripping nearly $1 billion in critical funding that supports kids, K-12 students, small businesses, and health and clean air research," while House Appropriations Committee ranking member Rosa DeLauro accused the White House of "trying to steal more money promised to communities," a characterization echoed across statements from Democratic appropriators, per NBC News' account of the reaction on Capitol Hill. Senate Appropriations Vice Chair Patty Murray, in a statement posted to her official Senate website, framed the cut as a direct affront to lawmakers who voted for the underlying spending bills on a bipartisan basis.

"This is theft from the American people, plain and simple. These are funds Congress has delivered on a bipartisan basis and should be helping people — not cut off by a president more focused on building a ballroom than investing in families. Every Republican who voted for these bills should be furious because Vought is saying their votes don't count."

The practical effect falls first on the nonprofits that receive the money and, in turn, on the people they serve: resettlement agencies helping refugees and asylees find housing and work, migrant students in public schools, and counseling organizations that help low-income families navigate mortgages and evictions. Several of the affected grantees have not yet said publicly whether they will challenge the cancellation in court, though advocacy groups pursued that route after the 2025 foreign-aid rescission, and an explainer published by Time notes that similar litigation is widely expected this time as well.

What Happens Next

With the fiscal year closing September 30, there is little practical room for Congress to reverse the cancellation through ordinary legislative means before the money expires. The House is not scheduled to return to full session until after the November midterm elections, and the Senate's calendar leaves scant time to force a vote even if enough Republicans joined Democrats in objecting. That leaves the courts as the likeliest venue for a challenge, following the same pattern as the 2025 dispute over foreign aid, which reached the Supreme Court on an emergency basis without a final ruling on the pocket-rescission theory itself. Congressional appropriators on both sides of the aisle have said they intend to raise the episode when Congress negotiates the next round of full-year spending bills, and GAO could weigh in with a fresh legal opinion given the second use of the tactic in just over a year. For now, the $810 million is set to lapse at midnight on September 30 unless a court intervenes before then.