This is what it looks like when OMB kills your program

The anatomy of a murder by five cuts

Office of Management and Budget Director Russell Vought attends the National Governors Association dinner at the White House, Saturday, Feb. 21, 2026, in Washington. (AP Photo/Allison Robbert)

You may have noticed: There are a lot fewer news stories about the Trump administration dramatically killing federal programs these days. From the original memo freezing funds to DOGE cancelling contracts and paying federal employees not to work — there’s simply less noise and drama over spending abuses in 2026 than there was in 2025.

But that doesn’t mean the abusive cuts have stopped. Instead, the Office of Management and Budget (OMB) has often shifted to killing programs quietly. If the DOGE cuts were like putting federal programs up for public executions, these days the abuses happen more like knives in a back alley.

What do those back-alley knifings look like?

Take the Community Development Financial Institutions (CDFI) Program. This program invests in community financial institutions to provide loans, and financing to areas in need of capital to support the development of affordable housing, and investments in farmers and small businesses, among others. Advocates estimate that every dollar in federal money leverages $8 in private capital that goes toward investments like more affordable housing.

The program is backed by a bipartisan caucus of legislators, and a coalition of groups that include a range of different types of organizations from banks to community lenders to housing advocates.

But the most important person when it comes to spending money in the Trump administration is OMB Director Russell Vought — and Vought hates this program.

That’s why OMB is killing it.

Since Vought took over OMB, not a penny of the $578 million of the 2025 or 2026 appropriations Congress passed for the CDFIs has been made available for the Treasury Department to spend.

To do so, OMB is using an obscure part of the budget process called apportionments to murder the program through small cuts — though rather than a thousand cuts, in this case it only takes five.

How to kill a program in five cuts

Each year after the president proposes a budget and Congress passes spending bills, it’s OMB’s job to apportion the funds, issuing documents for each account telling agencies how much money they can spend and how fast.

Until they get an apportionment, an agency generally cannot spend funds — even if they know the money is coming, even if they know Congress passed a law sending it to them, they still have to wait for an apportionment.

And that is how OMB made its first cut — it left the agency waiting. In fact the agency is still waiting — almost a year later.

In 2025 Congress passed a law providing $324 million for the CDFI program, $35 million for Treasury to spend in fiscal year 2025 to administer the program, and $289 million for Treasury to spend on funds for community banks and developers to actually help people do stuff.

In the apportionment process that normally happens, once Congress passes the bill, OMB apportions the funds, making the $35 million available for Treasury to spend in the current fiscal year, and transferring the remaining $289 million to an account that lasts for two years. This gives the agency a little more time and flexibility to spend those hundreds of millions of dollars responsibly.

What happened in 2025 was different. OMB apportioned the $35 million for program administration. And it transferred the $289 million to an account from which the money can be spent for two years, 2025 and 2026. But then OMB never apportioned the $289 million in program funds. To this day they are just parked in that two year account, aging in place.

Last year, advocates attempted over and over again to persuade the administration to release the money. They sent this letter about the benefits of the program and the communities it serves. They organized this letter from over a hundred Republican members of the House and Senate.

But still no apportionment of the 2025 funds. Advocates have continued to press. The Treasury Secretary recently stated he would spend the CDFI money if OMB released it. And given the amount of time it takes for the agency to complete its review of applications, if OMB doesn’t release the money soon, the 2025 funds will expire at the end of September without being spent.

Not only has OMB refused to release the 2025 funds, it has taken steps to hold back more.

There are at least three other accounts that have some funds that have gone to support CDFIs and their work, all three of those accounts collect proceeds from various mandatory funding streams. The money in those accounts is available indefinitely, rolling over year after year, and the lion’s share of those funds have been apportioned in the past for the CDFI program.

But over the last six months, these three accounts had almost all of their funds apportioned into Category C, and not a penny was made available to Treasury for the CDFI program.

Technically Category C is a way to apportion money for future fiscal years. You can see how it would come in handy if Congress passed a big pot of money for something like a moonshot research program, OMB can use Category C to structure the spending. So for example if an agency was still spinning up an office to manage the funds, you could give them time to get ready before sending them billions of dollars to manage and spend.

But over the last year OMB has started using Category C for more than money management. OMB has started using Category C to hold back funds that Congress told them to spend. And because funds apportioned in Category C cannot be spent in the current fiscal year — those apportionments effectively act as a cut.

Category C is a sneaky way for OMB to unilaterally make cuts it could not get Congress to agree to in the law.

And that is how OMB made three more cuts to the CDFI program — by preventing even a single penny of the CDFI Program account, the Emergency Capital Investment Fund or the Capital Magnet Fund from being spent on the CDFI program this year — accounts that used to provide tens or hundreds of millions for the program.

In the last few weeks, advocates have been raising the alarm that between the 2025 money it impounded and the rollover funds it froze in Category C, OMB is holding up more than a billion dollars that could be used for CDFIs.

Two weeks ago, OMB responded by making a fifth cut — pulling the same move with the fiscal year 2026 appropriations for the CDFI program.

Just a few months ago Congress passed a law on a bipartisan basis providing $324 million for the CDFI program, $35 million for administration and $289 million for the program itself.

And once again, OMB apportioned the administrative funds, but transferred the $289 million to another account, an account for which there hasn’t even been a public financial report yet, let alone an apportionment.

To the extent that anyone thought OMB would have more respect for full year appropriations bills passed on a bipartisan basis, this incident ought to put such hopes to rest. If OMB wants to kill your program, shame over breaking the law won’t stop it from trying.

Spending abuses are illegal, regardless of how sneaky

But hey, you’re thinking, this sounds illegal.

Yes! It is.

And sure, the CDFIs could sue. But that’s going to take time. And they’ll have to convince a court that it’s an emergency to force OMB to apportion it now — even though the 2025 money isn’t going to expire for six months — so that Treasury has time to take in applications and review them and decide which CDFIs get what funds. And if they can’t convince a court to force OMB to get the money out sooner than later, some or all of that $289 million will expire.

In the meantime, the CDFI program, much like someone who has been stabbed five times in a back alley, is vulnerable and at risk for more attacks.

While CDFIs fight to claw back this money either in federal court or the court of public opinion, OMB can propose a rescission of these funds that would send this money back to the Treasury. Or a legislator looking for an offset to fund their pet project might use some or all of the billion bucks sitting in these accounts to pay for something else. And if either of those things happens it won’t matter if the CDFIs win their case, because the money will already be gone.

So, you ask, is OMB really just going to get away with it? Is this like the perfect money murder?

Maybe, though there is one way they might get caught.

When Congress passes spending laws it attaches all kinds of conditions. A few of those conditions are called ‘general provisions’ and they apply to all the appropriations across all the agencies.

For years, one of these general provisions has prevented agencies from using any funds to implement cuts in the president’s budget unless or until Congress agrees to those cuts in an appropriations law.

And right now OMB appears to be violating that condition — a condition which applies to OMB’s own funding. By holding back the money for a program Congress funded but the president wanted to eliminate in 2026 OMB is basically doing what Congress says it cannot use funds to do — going rogue and unilaterally implementing the president’s budget.

And the law that enforces these kinds of conditions is a scary one — the Antideficiency Act — it imposes personal liability on the officials that violate it.

Here’s the kicker — the statute of limitations for this law is five years. So what can CDFIs and Congress do?

They can put OMB officials on notice that they may be liable, and they can keep a record of who has been responsible for what. Because if a future DOJ can prove an official violated the Antideficiency Act knowingly and willfully, they won’t just be liable for administrative penalties.

For the crime of money murder, they could face up to two years in jail.