The Issue:

Rescissions

On May 8, President Trump exercised the authority granted under the Congressional Budget and Impoundment Control Act of 1974 (ICA) and formally requested Congress rescind $15.4 billion in unobligated balances or money that was previously appropriated but never spent. From the time of the request, a 45-day countdown began for congressional action—ending June 22. Once the House introduced a rescission bill to the relevant committee, the committee has 25 calendar days to report the bill out of committee. Debate is limited, making the bill unobstructed from the filibuster in the Senate.

This is not a new process, though many current lawmakers and staff have never gone through the steps before. The President’s request is a small down payment on years of congressional promises of fiscal restraint and will build the necessary muscle memory to return for another round of cuts in the future.

Our Position

Heritage Action supports President Trump’s rescission request and expects lawmakers on both sides of the aisle and in both chambers to put the American taxpayer first by rescinding $15.4 billion that has been unused, diverted, or has become unnecessary. This is basic fiscal housekeeping.

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Congress Should Pass President Trump’s Rescissions Request

Washington—This morning, the Trump administration formally requested Congress rescind more than $15 billion in previously appropriated funding. The authority for such a request comes from the Congressional Budget and Impoundment Control Act of 1974 (ICA). Heritage Action released the following statement from Chief Operating Officer Tim Chapman:

The Trump administration deserves credit for its historic $15 billion rescissions request. Heritage Action looks forward to working with the administration and leaders in the House and Senate to rescind unspent money that is just sitting around. For too long, Americans have watched as the Washington Establishment spends our nation further and further into debt. Today’s rescission request will not change that overnight, but it will signal a desperately needed shift in mentality and begin to build the legislative muscle memory for future action.

In a Wall Street Journal op-ed, Russ Vought, who is deputy director of the White House Office of Management and Budget, makes clear “The Trump administration and Congress must be responsible with each taxpayer dollar that comes to Washington.” Vought concludes:

Over the past decade, it’s become increasingly apparent that Washington has no appetite for fiscal restraint. Unless the federal government as a whole commits to cutting spending and letting the economy grow, bloated deficits and outrageous levels of debt will haunt future generations. President Trump stands ready to put our fiscal house back in order and put the American taxpayer first. Does the rest of Washington?

House Freedom Caucus Chairman Mark Meadows (R-N.C.) told reporters, “I think what you do is you start with incremental steps and hopefully what we’re able to do is show that we can start here. This is I believe the first of many rescission packages that you’ll see.”

Related:

Heritage Action: GOP Should Exercise Fiscal Restraint through the Impoundment Control Act
Heritage: A Crucial First Step Toward Fiscal Discipline: Why the President and Congress Should Pursue a Rescissions Package

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May 08, 2018

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GOP Should Exercise Fiscal Restraint through the Impoundment Control Act

Background

Passed in 1974, the Congressional Budget and Impoundment Control Act establishes a process for cancelling unnecessary funding to executive branch agencies. Under this law, the president may withhold and permanently cancel funding to executive branch agencies passed into law by Congress. This is accomplished only if Congress approves of the president’s special message that includes rescissions specifying the “amount of budget authority” to be rescinded, as well as “all facts, circumstance, and considerations relating to or bearing upon the proposed rescission.” Congress is not required to introduce a rescission bill and can introduce a bill containing fewer rescissions than requested by the President. Once the special message is delivered and a rescission bill is introduced and referred to the relevant committee, the committee has 25 calendar days to report the bill. If the committee fails to report the bill, any member can discharge the bill from committee with one-fifth approval of the chamber vote. Debate on the motion to the rescission bill is limited to two hours in the House, ten hours in the Senate, and two hours for a conference report within the period of 45 days of continuous session following delivery of the special message. A rescission bill not included in the president’s special message is subject to the filibuster.        

Congress has rescinded a total of only $25 billion in federal spending using the Impoundment Control Act. The last time Congress used the law was in 1992, under President George H.W. Bush. The Impoundment Control Act has seldom been used because it requires Congress to approve cutting funding it recently authorized. The Act can almost be viewed as a weakened version of a line-item veto which allowed presidents to remove certain provisions of a bill before signing them into law. In 1998, the Supreme Court ruled the line-item veto unconstitutional in Clinton v. City of New York.

Rescind Omnibus Non-defense Spending

Last month, Congress passed—and President Trump signed into law—a $1.3 trillion omnibus spending package that increased defense spending by $80 billion and non-defense spending by $63 billion over the Budget Control Act. According to congressional Republicans and President Trump, the GOP agreed to the omnibus spending levels because Senate Democrats threatened to filibuster and shutdown the government if Congress increased defense spending without increasing non-defense spending. This is where the Impoundment Control Act comes into play. Section 1017 of this law sets up a rescission process that can be used by Republicans in Congress to cancel the wasteful non-defense spending appropriated in the omnibus bill. That process begins with a special message by President Trump properly outlining his rescission requests. Senate Democrats would not be able to filibuster the President’s request if 218 House Republicans and 50 Senate Republicans can agree to the proposed spending cuts.

Potential Spending Reductions

The Good, Bad, and Ugly of the Fiscal Year 2018 Omnibus Appropriations Act, The Heritage Foundation lays out a number of wasteful spending provisions the Trump administration could include in its Impoundment Control Act special message request to Congress. Additionally, in Blueprint for Balance: A Federal Budget for Fiscal Year 2018, The Heritage Foundation lays out billions in non-defense spending cuts the Trump administration could also consider in its request.

The recently-passed omnibus spending package broke the non-defense spending levels established in the Budget Control Act by $63 billion and authorized $100 billion more in non-defense spending than requested in President Trump’s 2018 budget. The President should use these numbers as a starting point in his special message rescission proposal to Congress.

Conclusion

If the Republican Party is truly concerned with excessive spending and debt, the Impoundment Control Act provides the best opportunity to undo the damage of the recently-passed omnibus spending package. According to a recent Gallup poll, 77 percent of Americans are “a great deal” or “a fair amount” concerned with federal spending and the budget deficit. By reining in federal spending using the Impoundment Control Act, congressional Republicans can demonstrate to midterm election voters that they will govern responsibly and steward taxpayer dollars if re-elected to the majority. It also gives the GOP leverage in future spending negotiations by neutralizing the threat of a democrat filibuster and government shutdown.


Wesley Coopersmith
Policy Manager
Heritage Action for America 

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Apr 06, 2018

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