Government agency layoffs do not violate illegal seizures, GAO determines

The Government Accountability Office (GAO) has found that the Energy Department has violated the Impoundment Control Act (ICA) by delaying disbursements under the Renew America's Schools program for policy reasons.

This is not the first time the Trump administration has been accused of unlawfully withholding funding. Previously, GAO found that the administration violated the ICA at the Transportation Department, Health and Human Services Department, and the Institute of Museum and Library Services.

The Energy Department's violation of the ICA is related to the exercise of the legislative branch's power of the purse. The ICA was enacted to ensure that the President cannot unilaterally withhold congressionally approved spending.

Meanwhile, the Homeland Security Department's mass layoffs in March did not violate the ICA, according to GAO. GAO stated that a Reduction in Force (RIF) to achieve savings does not violate the ICA as long as any net savings are offset by other allowable expenses.

The United States Agency for International Development (USAID) was also found to have violated the ICA in 2025 by delaying payments under the Renew America's Schools program.

The Energy Department has obligated only 17% of its fiscal 2025 appropriation for the Renew America's Schools program and has not expended any of it. Sen. Patty Murray, D-Wash., has stated that denying schools funding for energy efficiency upgrades that save them money is illegal and harmful.

The White House has stated it may invoke "pocket rescissions," a process through which it can unilaterally withhold funding at the end of the fiscal year. However, GAO stated that the President does not have the authority to implement pocket rescissions, as found in Trump's first term.

The White House's Office of Management and Budget (OMB) told GAO in May that it would only cooperate with the watchdog's impoundment probes when doing so did not impede its ability to carry out President Trump's agenda. This lack of cooperation has made it difficult for GAO to confirm whether the layoffs resulted in any savings or if impacted employees are still on paid administrative leave.

Congress provided the specific DHS offices that were subject to RIFs with lump-sum appropriations and did not mandate any specific staffing level. DHS officials have stated they are continuing to expend their full appropriation for the impacted offices for fiscal 2025.

In conclusion, the Energy Department has violated the ICA by delaying disbursements under the Renew America's Schools program. This violation is a clear example of the administration's disregard for the legislative branch's power of the purse and the importance of adhering to federal statutes.