By Tom Hals and Andy Sullivan
(Reuters) – President Donald Trump’s administration on Monday issued a sweeping directive to federal agencies to temporarily pause billions of dollars of spending on health care, housing assistance and disaster relief.
Trump’s political opponents vowed to challenge the directive. Below is a look at the legality of the directive.
CAN TRUMP ADMINISTRATION BE SUED FOR WITHHOLDING SPENDING?
Yes, and at least one lawsuit was filed on Tuesday. Legal experts said states, cities, nonprofits and virtually anyone else who stood to receive money under a federal program could probably sue.
Legal experts said withholding funding might violate the Constitution, which gives to Congress the “power of the purse,” or the authority to decide how to spend government money and which programs to fund. Parties to government contracts that will now go unpaid will also likely have grounds to sue. Tuesday’s lawsuit said the Trump administration violated administrative law that prevents agencies from adopting arbitrary and capricious actions.
WHAT IS THE IMPOUNDMENT CONTROL ACT?
Opponents of the administration’s spending pause said it might violate the Impoundment Control Act of 1974 (ICA). The law created a process for Congress to review a federal agency’s withholding of funds that were approved by Congress. The law grew out of decisions by the administration of Richard Nixon to withhold, or impound, highway and water control funds in a bid to control inflation.
The act allows a president to withhold funds in certain specific circumstances for limited periods of time and requires the president to send a special message to Congress explaining the action. Congress must then decide whether to allow spending to be deferred or rescinded.
The Government Accountability Office (GAO) monitors compliance and is empowered to sue an agency.
WHEN CAN A PRESIDENT WITHHOLD BUDGET AUTHORITY?
Under the act, a president can defer budgeted funds to “provide for contingencies” or to achieve savings made possible by changes in requirements, or as specifically provided by law. The president cannot withhold funds to achieve policy goals. However, the directive by the Trump administration seemed to do that, stating that “the use of Federal resources to advance Marxist equity, transgenderism, and green new deal social engineering policies is a waste of taxpayer dollars.”
WHO HAS OVERSIGHT OF THE IMPOUNDMENT ACT?
The GAO, a nonpartisan agency that works for Congress, can investigate spending and determine if withholding of funds appropriated by Congress was legal. The GAO determined during Trump’s first presidency that his administration violated the ICA by withholding security aid for Ukraine.
WHAT HAVE TRUMP AND HIS ADVISERS SAID?
Trump vowed during his presidential campaign to use impoundment of spending “to squeeze the bloated federal bureaucracy for massive savings.” He also said the law allowed Congress to usurp power from the executive branch. Russell Vought, Trump’s nominee for the Office of Management and Budget, testified to Congress earlier this month that he thought the ICA was unconstitutional.
WHAT ARE THE ARGUMENTS OF CRITICS OF THE LAW?
Conservative advocates have argued that until the presidency of Richard Nixon, who took office in 1969, it was understood that the Constitution gave Congress the power to set a ceiling on spending, but the president had the authority to spend less.
(Reporting by Tom Hals in Wilmington, Delaware; additional reporting by Andy Sullivan; Editing by Leslie Adler)
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