As he ran to return to the Oval Office, Donald Trump promised, "I will use the president's long-recognized impoundment power to squeeze the bloated federal bureaucracy for massive savings."
Barely a week after Trump was inaugurated, his administration took the first step toward that goal, issuing a late-night memo Jan. 27 ordering a temporary pause on all federal grants, loans and financial assistance, except for direct assistance to individuals, until officials ensure that the programs are consistent with Trump's policies.
The memo said the pause will give the Trump administration time to review the programs and "determine the best uses" of the funding. It gave agencies until Feb. 10 to submit detailed information on any programs, projects or activities subject to the pause.
By Jan. 29, the administration rescinded the Office of Management and Budget's memo.
"This is NOT a rescission of the federal funding freeze. It is simply a rescission of the OMB memo," White House Press Secretary Karoline Leavitt said Jan. 29 on X. "Why? To end any confusion created by the court's injunction. The President's EO's on federal funding remain in full force and effect, and will be rigorously implemented."
Several nonprofit organizations and several states sued the Trump administration over the pause (before it was lifted). On Jan. 28, U.S. District Judge Loren L. AliKhan temporarily blocked the action until Feb. 3. On Jan. 29, the court was preparing to decide what the memo's rescission meant for the court case. AliKhan's initial ruling didn't address the memo's underlying legality.
Legal observers see the initial funding pause as the opening volley in a legal battle on impoundment, which is an executive refusal to spend funds Congress has appropriated. Trump believes he can exert such authority, but critics say he can't.
Impoundment authority has a long history, going back at least to President Thomas Jefferson. Later presidents who claimed independent power to impound funds include Harry Truman, John F. Kennedy and Richard Nixon.
Skeptics say that these presidents' arguments were shut down by the Impoundment Control Act of 1974, which Congress passed "after President Nixon abused it," wrote Zachary Price, a professor at the University of California College of the Law. The law set up a detailed process for what a president could and could not do when there was a disagreement over whether to spend money that had been signed into law.
If the executive branch wants to cancel spending altogether, the 1974 law says, it must propose a "rescission," or a cut. Lawmakers may consider those proposed cuts under an expedited process, but the spending cannot be paused for more than 45 days as this process plays out.
"Regardless of whether the administration is willing to claim that this pause can be justified by some broader presidential impoundment power, it would seem to run afoul of the statutory framework that Congress put in place to manage any spending delays," Yale Law School professor Keith E. Whittington said.
We'll see whether the administration continues to pursue the idea that the president has unilateral impoundment power, and whether judges challenge it. But the initial memo lays out the Trump administration's intent to advance this promise, so we rate this promise In the Works.