A rescission is when Congress passes a new law to cancel appropriated budget authority before it is spent by the Executive Branch.
The Impoundment Control Act (ICA) creates an expedited rescissions process, where the President can propose rescissions and then Congress can pass the rescission bill by a simple majority in both chambers, bypassing the filibuster 60-vote threshold in the Senate.
45 Day Withholding Window
The ICA’s expedited rescissions process is only available within 45 days of continuous Congressional session after the President proposes a rescission.
During that 45-day window of Congressional consideration of the proposed rescission, the President is permitted to withhold the funds from being obligated or spent.
Expiration of Funds Within the 45 Day Window
An important element of any appropriation is the time period of availability for the funds. Whenever Congress provides budget authority, it tells the Executive Branch how long the funds are available to be spent before they expire. In normal annual appropriations bills, most of the funds will expire at the end of the fiscal year on September 30.
The President could carry out a pocket rescission by proposing expiring funds to be rescinded within the 45-day window prior to the end of the fiscal year and then withholding them from being spent until they expire.
This pocket rescission procedure could allow the President to unilaterally eliminate certain appropriations that remain unspent within 45 days of the end of the fiscal year, without Congress having to approve the rescission bill.
Legality of Pocket Rescissions
Pocket rescissions were carried out by the Ford and Carter Administrations in the years shortly after the ICA was enacted. However, pocket rescissions as well as the broader ICA rescissions process have fallen out of practice in recent decades.
The legality of pocket rescissions has been disputed. In a 2018 letter, the Government Accountability Office (GAO) opined that “the ICA does not permit the withholding of funds through their date of expiration.”
The GAO’s analysis leans heavily on the context and legislative history of the ICA. The purpose of enacting the ICA in 1974 was to restrict the President’s ability to impound or unilaterally withhold appropriated funds.
“One must read the ICA as a whole… It would be inimical to the ICA and to its constitutional underpinnings for the executive to avail itself of the withholding authority in the ICA, but to ignore the remainder of the process.”
Office of Management and Budget (OMB) General Counsel Mark Paoletta responded to the GAO by pointing out that, “The text of the ICA places no limit on how late in the fiscal year a President may propose funds for rescission or withhold funds pending Congressional consideration of a rescission proposal,” and reviewing the history of previously enacted pocket rescissions, which the GAO did not object to at the time.
The relevant provision of the ICA reads:
“Any amount of budget authority proposed to be rescinded or that is to be reserved as set forth in such special message shall be made available for obligation unless, within the prescribed 45-day period, the Congress has completed action on a rescission bill rescinding all or part of the amount proposed to be rescinded or that is to be reserved.”
There is no restriction in the ICA on when the President may or may not propose a rescission. In contrast, the ICA places an affirmative duty on the President to propose a rescission:
“Whenever the President determines that all or part of any budget authority… should be rescinded for fiscal policy or other reasons… the President shall transmit” a special message to Congress proposing a rescission.
After the Ford Administration implemented pocket rescissions in 1975, the GAO acknowledged that:
“In our opinion, having to wait 45 days of continuous session before it can be determined that a proposed rescission has been rejected is a major deficiency in the Impoundment Control Act… In the case of two recent rescission proposals, Congress was unable, under the Act, to reject the rescission in time to prevent the budget authority from lapsing.”
In its 2018 opinion, GAO said that “we overrule our prior inconsistent opinions” on the shortcomings of the ICA because those opinions (and the ICA) were adopted prior to the Supreme Court decisions in Chadha that prohibited a legislative veto and Clinton that prohibited a Presidential line-item veto.
At least one thing is clear: the ICA is a poorly and inconsistently drafted law.
Pocket Rescissions Could Be a Tool to Control Spending
Substantial budgetary resources often remain available towards the end of a fiscal year, contributing to a “use it or lose it” spending mentality by agencies. As of the end of June 2025, there was $324 billion in discretionary budget authority set to expire at the end of FY 2025 on September 30. This could make pocket rescissions a useful tool to restrain wasteful spending.
