Republicans Mulling Budget Gambit to Avoid Spending Some Omnibus Funds

McCarthy, White House discussing rarely used impound procedure in 1974 budget law

President Donald Trump and his administration are discussing a process with House Majority Leader Kevin McCarthy that could allow Republicans to rescind some funds they recently approved in the bipartisan omnibus spending bill. (Tom Williams/CQ Roll Call file photo)

President Donald Trump and congressional Republican leaders, frustrated they had to work with Democrats to pass a fiscal 2018 omnibus spending measure, are mulling a way for their party to effectively cut some of the funds they just approved. 

The idea would be to deploy lesser-used provisions of the 1974 budget law to roll back spending by impounding some of the appropriated funds.

The Congressional Budget and Impoundment Control Act of 1974 — more frequently referred to as the Budget Act, the sections of the law that are more commonly used — provides an expedited process for the president to propose and Congress to review a rescission resolution identifying appropriations that the administration does not want to spend. 

The president must submit a message to Congress specifying the amount of funds the administration wants to rescind and from which accounts and programs, along with estimated fiscal and program effects and the reasons for the rescission, according to the Congressional Research Service. 

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Multiple rescissions can be grouped in a single message, and Congress has 45 legislative days to approve all, part or none of the president’s request.

The budget law would provide a path for the Senate to consider a rescission resolution with only a simple majority support.

House Majority Leader Kevin McCarthy has been discussing the possibility of a rescission package with White House officials as a way to curb domestic spending in the omnibus, a GOP aide confirmed Monday evening following reports from ABC News.

McCarthy and Trump personally discussed the idea during a phone call this week, while the speaker’s office has had staff level discussions with the White House about the concept, a senior GOP source added. Since the rescission process has not been used in a long time, congressional leaders are still discussing how it all might play out but it is an idea they're taking seriously, the source said. 

The White House and the Office of Management and Budget did not return requests for comment. 

The discussions come after Congress passed and Trump begrudgingly signed into law a $1.3 trillion omnibus spending bill last month.

Republicans celebrated a boost to defense spending, while lamenting the increase to domestic spending that was necessary to win Democratic support. 

Trump, in an an omnibus signing ceremony held hours after he threatened to veto the measure, called on Congress to give him line-item veto authority on spending bills — a law Congress passed in 1996 but the Supreme Court declared unconstitutional just two years later.

The impound procedure provides the president with similar power to reject specific spending but only with the constitutionally required approval of Congress, which holds the power of the purse. 

The maneuver may succeed in the House but would be a tough lift in the Senate, where Republicans hold a slim 50-49 majority (soon to be 51-49 after Cindy Hyde-Smith is sworn in to fill the Mississippi Senate seat vacated by Thad Cochran).

Getting 50 Republican votes to roll back spending the Congress just approved might be a long shot given the delicate nature of crafting the omnibus itself.

Such an effort would almost certainly make it harder for appropriators to negotiate future bipartisan spending deals. Congress has just six months to attempt to pass all 12 appropriations bills, whether individually or packaged again as an omnibus, before the start of fiscal 2019 on Oct. 1.

McCarthy's involvement in the rescission discussions comes after he led a congressional effort to use a similar expedited procedure to roll back more than a dozen regulations approved under the Obama administration. The Congressional Review Act provides Congress with 60 legislative days after an executive agency finalizes a regulation to pass a resolution to repeal the rule.

Like the rescission resolution, CRA measures were able to move through the Senate with only a simple majority vote. However, Republicans are much more united in their opposition to regulations than they are to domestic spending. 

John T. Bennett contributed to this report. 

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