Madeline Materna (Stanford University) has posted Constructive Impoundment on SSRN. Here is the abstract:
This article identifies and theorizes a distinct form of executive fiscal abuse that existing enforcement practice has failed to recognize: constructive impoundment. In a constructive impoundment, the executive branch does not refuse to obligate appropriated funds outright, which would trigger the Impoundment Control Act of 1974. Instead, it formally obligates the appropriation while deploying those funds in ways designed to frustrate or nullify the very program for which Congress provided funding. Although the practical effect is indistinguishable from a traditional impoundment—Congress’s program is denied effect—constructive impoundments have repeatedly escaped legal scrutiny because the funds are technically “spent.” The article’s core claim is that constructive impoundment is not a gap in federal fiscal law but a misclassified violation. Properly understood, it is a spending problem, not a withholding problem, governed by the Purpose Statute and enforced through the Antideficiency Act. Congress controls execution by limiting appropriations to the purposes it has chosen. When agencies expend appropriated funds in ways calculated to prevent the statutory objective from being achieved, such expenditures are unauthorized. Stated plainly, the lawful amount available for sabotage is zero. Spending any amount to obstruct a congressionally funded program therefore exceeds the amount legally available and triggers the Antideficiency Act’s reporting and liability regime, including personal and potential criminal liability for knowing and willful violations. This article proceeds in three parts. Part I reconstructs the structure of federal appropriations law, situating Congress’s power of the purse as a core separation-of-powers constraint. It explains how this constitutional prerogative has been operationalized through statutory regimes—the Purpose Statute and Antideficiency Act constraining executive spending, and the Impoundment Control Act constraining executive withholding. Although the statutes themselves regulate the methods through which executive usurpation may occur, modern oversight practice has departed from this design by sorting violations by outcome rather than by method—routing expansion to the Antideficiency Act and obstruction to the Impoundment Control Act. Part I then introduces constructive impoundment as a distinct category of fiscal abuses that arises when spending is used to obstruct a congressionally funded program, revealing a systematic blind spot in existing enforcement practice. Part II demonstrates how constructive impoundment operates in practice through recent case studies from administrations of both parties, focusing on the Biden administration’s redirection of border wall construction funds and the second Trump administration’s large-scale use of extended paid administrative leave to incapacitate agencies while continuing to obligate salary appropriations. In each case, the executive structured spending to defeat a disfavored statutory objective while avoiding formal impoundment. Part III explains how the enforcement gap surrounding constructive impoundment emerged and how it can be closed within existing appropriations law. It shows that courts are structurally ill-suited to police constructive impoundments and that the gap has been compounded by the GAO’s practice of treating obstruction exclusively as a withholding problem, halting analysis once funds are found obligated. Drawing on the GAO’s own interpretive doctrine, Part III demonstrates that constructive impoundments are already cognizable as Antideficiency Act violations and explains how reorienting GAO review would restore the informational, legitimating, and deterrent functions of fiscal oversight. Crucially, the proposed approach retains enforcement value even in the absence of congressional action.
Highly recommended!
To receive a daily summary of posts from Legal Theory Blog by email, get a free subscription to Legal Theory Stack.