"Still, Obama and his Democratic allies accepted $600 million in cuts to a community health centers programs, $414 million in cuts to grants for state and local police departments, and a $1.6 billion reduction in the Environmental Protection Agency budget, almost $1 billion of which would come from grants for clean water and other projects by local governments and Indian tribes. The National Institutes of Health, which funds critical medical research, would absorb a $260 million cut, less than 1 percent of its budget, instead of the $1.6 billion cut sought by House Republicans. Family planning programs would bear a 5 percent cut rather than being completely eliminated."
[snip] ...The current rules and procedures for impoundment were created by the Congressional Budget and Impoundment Control Act of 1974 (2 U.S.C.A. Â§ 601 et seq.), which was passed to reform the congressional budget process and to resolve conflicts between Congress and President RICHARD M. NIXON concerning the power of the EXECUTIVE BRANCH to impound funds appropriated by Congress. Past presidents, beginning with THOMAS JEFFERSON, had impounded funds at various times for various reasons, without instigating any significant conflict between the executive and the legislative branches. At times, such as when the original purpose for the money no longer existed or when money could be saved through more efficient operations, Congress simply acquiesced to the president’s wishes. At other times, Congress or the designated recipient of the impounded funds challenged the president’s action, and the parties negotiated until a political settlement was reached. [pnis]
[snip] Impoundment of Appropriated Funds — In his Third Annual Message to Congress, President Jefferson established the first faint outline of what years later became a major controversy. Reporting that $50,000 in funds which Congress had appropriated for fifteen gunboats on the Mississippi remained unexpended, the President stated that a âfavorable and peaceful turn of affairs on the Mississippi rendered an immediate execution of the law unnecessary... .â But he was not refusing to expend the money, only delaying action to obtain improved gunboats; a year later, he told Congress that the money was being spent and gun-boats were being obtained.628 A few other instances of deferrals or refusals to spend occurred in the Nineteenth and early Twentieth Centuries, but it was only with the Administration of President Franklin Roosevelt that a President refused to spend moneys for the purposes appropriated. Succeeding Presidents expanded upon these precedents, and in the Nixon Administration a well-formulated plan of impoundments was executed in order to reduce public spending and to negate programs established by congressional legislation. [pnis]