Sponsors
The bill gives the President a fast, unilateral tool to pause obligations and reduce annual deficits—potentially protecting entitlements and averting fiscal crises—but does so at the cost of shifting budget control to the executive, creating service disruptions and uncertainty for governments, workers, and grant recipients.
Medicare and Social Security beneficiaries (retirees and disabled Americans) are protected from near-term executive cuts because the bill preserves entitlement funding from midyear withholding.
Taxpayers face a lower risk of higher future taxes or increased borrowing because the President can withhold obligations to eliminate an annual deficit, reducing federal deficits in the near term.
Taxpayers and federal officials gain a faster tool to respond to a fiscal-year crisis because the President can pause obligations to avoid running a deficit, potentially averting urgent fiscal instability.
Congress and the public see a shift in budget authority because the bill gives the President unilateral power to withhold funds, weakening Congress's power of the purse and reducing legislative oversight.
State and local governments, taxpayers, and people who rely on federal programs risk service disruptions because the President could delay or reduce federal obligations midyear.
Federal employees and contractors face harm because withholding obligations could lead to hiring freezes, furloughs, or paused contracts.
Based on analysis of 4 sections of legislative text.
Allows the President, after consulting Treasury and OMB, to withhold covered budgetary resources in a fiscal year to eliminate a projected deficit, excluding Medicare and Social Security funds.
Gives the President temporary authority to withhold (decline to obligate) certain federal budgetary resources during a fiscal year when the President, after consulting Treasury and OMB, determines there will be a deficit, up to the amount needed to eliminate that deficit. The power covers discretionary appropriations and direct spending but explicitly excludes Medicare (Title XVIII) and Social Security OASDI (Title II) and operates despite the Impoundment Control Act of 1974.
Introduced February 26, 2026 by Richard Lynn Scott · Last progress February 26, 2026