Trump’s Nearly $1 Billion in Funding Cuts Explained: What Congress Passed and Which Programs Are Affected | Today’s news

US President Donald Trump has moved to cancel nearly $1 billion in federal spending previously approved by Congress, using a rarely used and legally contentious mechanism known as “out-of-pocket withdrawals.” The move, announced by the White House on September 25, targets programs dealing with immigration, education, housing, minority business development, health research and international environmental initiatives.

The administration says the funds represent wasteful, duplicative or ideologically motivated spending that no longer serves the American taxpayer. Critics, including lawmakers from both parties, say the executive branch cannot effectively rescind money appropriated by Congress without congressional approval.

Here’s what the move means and which programs are affected.

What is “Out of Pocket”?

Rescission is the cancellation of funds that Congress has already appropriated. Under the Impoundment Control Act of 1974, the president can propose that Congress cancel appropriated funds. Congress generally has 45 legislative days to consider a proposal.

The “out-of-pocket appeal” is a more controversial maneuver. The administration sends a rescission request when there is so little time left in the fiscal year that the 45-day congressional review period cannot realistically be completed before the funds expire.

Trump’s latest package was announced just five days before the end of the federal fiscal year on Sept. 30, leaving little practical time for Congress to act. The administration argues that the mechanism is allowed under the Reservoir Control Act, while critics in Congress and the Government Accountability Office have questioned the legality of using it in this way.

Trump has used this tactic before

The latest action follows Trump’s use of the out-of-pocket waiver in 2025, when his administration sought to block $4.9 billion in foreign aid approved by Congress.

It was the first use of the mechanism in almost 50 years.

The Supreme Court declined to block those repeals, with the justices giving significant weight to the president’s authority in foreign affairs. The current package is different because it primarily focuses on domestic programs.

Which programs are they targeting?

According to the White House, the package includes the following main categories:

The biggest part of the package includes $567 million in health and social services funding for programs serving refugees, asylum seekers, unaccompanied minors and other non-citizens.

The Trump administration argues that the money is no longer needed because illegal border crossings have dropped significantly. The White House also criticized several organizations that received federal grants, highlighting their immigration-related work and, in some cases, their ties to former Democratic administrations.

Other significant cuts include:

$70 million for international education programs

$56 million for HUD housing counseling programs

$28 million in HHS research grants

$25 million for educational programs serving migrant students

$15 million for the Justice Department’s Community Relations Service

$15 million for DHS programs serving non-citizens

$10 million for programs to help immigrants with legal services

$10 million for the Minority Business Development Agency

$9 million in debt forgiveness related to environmental programs

$5 million for the HHS Office of Minority Health

The White House says HHS targeted research grants include projects it deems duplicative, ideological or unrelated to the department’s core mission.

Why is this move controversial?

The dispute goes beyond individual programs. It centers on who has ultimate authority over federal spending—Congress or the president.

The Constitution gives Congress the power of the purse. Under the Recruitment Control Act, presidents can propose rescissions, but the law establishes a congressional process for approving them. The Bipartisan Policy Center notes that the legality of “out-of-pocket withdrawals” remains unresolved because the law does not specifically address this scenario.

Susan Collins objects

The move also drew criticism from Republican Sen. Susan Collins of Maine, chairwoman of the Senate Appropriations Committee.

Collins said the administration acted without warning or consultation and accused the Office of Management and Budget of overstepping its authority.

“Not only is the delay itself a seizure that has not been reported to Congress, it is also a usurpation of Congress’ appropriations authority,” Collins said.

She said she would work with colleagues to address what she described as “illegal conduct.”

The Democrat condemns the move

Sen. Patty Murray of Washington, the top Democrat on the Senate Appropriations Committee, called the action “a theft from the American people.”

Murray argued that the funds were authorized by Congress on a bipartisan basis and should be spent as lawmakers intended.

The White House, meanwhile, says the president is using the powers available under the Reservoir Control Act to eliminate spending it deems wasteful or harmful.

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