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California, six other states sue Trump admin for withholding federal funds

California and six other states filed a lawsuit against the Trump administration on Wednesday, accusing it of withholding federal funds approved by Congress, including about $810 million the White House moved to cancel before the fiscal year ended.

Devika Nair

Reuters

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October 1, 2026

California, six other states sue Trump admin for withholding federal funds

US President Donald Trump speaks to the media as he departs the White House on the South Lawn in Washington, DC, US, September 26, 2026.

Annabelle Gordon / Reuters

California and six other states filed a lawsuit against the Trump administration on Wednesday, accusing it of withholding federal funds approved by Congress, including about $810 million the White House moved to cancel before the fiscal year ended.


Last week, US President Donald Trump sought to unilaterally withhold the funds approved by Congress for spending on immigration, race and education. The White House deployed a technique known as a "pocket rescission" for the move.


The lawsuit sets up a fresh legal clash over the limits of presidential spending power. A pocket rescission — sending Congress a request to cancel funds so close to the end of a fiscal year that they expire before lawmakers can act — has drawn bipartisan criticism as an attempt to circumvent Congress' constitutional authority over federal spending.


The lawsuit filed in the US District Court for the Northern District of California and led by California Attorney General Rob Bonta argues that the administration's refusal to spend appropriated money violates the Constitution's separation of powers, appropriations and presentment clauses.


"I continue to be appalled by President Trump’s blatant disregard for the basic Constitutional framework of our government. Just because the President doesn’t like a program doesn’t mean he can defund it," Bonta said in a statement.


The Constitution gives Congress the power of the purse, but the White House said last week the programs supported illegal immigration, stoked racial tensions and promoted alarmist approaches to the environment.


The states argued in their lawsuit that the Trump administration's efforts to withhold federal funds undermine Congress' exclusive power to control federal spending.


The White House could not be immediately reached for comment outside regular business hours.


Reporting by Devika Nair in Bengaluru; Editing by Tom Hogue/Reuters

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