A creative way to get federal money sent back
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I'm David Brancaccio in Los Angeles. Trump administration officials have identified a possible loophole that could enable what are often termed clawbacks. Marketplace's Nancy Marshall-Genzer joins us now to explain.

Well, this is a process known as rescission. We talked about it yesterday, David. It basically cancels spending Congress approved. Since Congress has the power of the purse, only lawmakers can claw money back. And here's that loophole. Once the president sends a rescission request to Congress, the funding he wants to take back is fraudulent.

frozen for 45 days. Now, funding approved by Congress for this fiscal year dies at the end of the fiscal year anyway on September 30th. Bobby Kogan is a former Senate and White House budget staffer now at the Center for American Progress. He explains it this way.

And they're like, oh, we found a loophole where we can do it. Even if Congress says no, you send it up on August 15th. Congress says no on August 20th. But you still have 45 days to pause and you can pause at the end. That would be an insane loophole. But that's what they're arguing.

And Nancy, administration officials are starting to make this case in public. White House Budget Director Russell Vogt, for example. Yeah, he's been on CNN talking about this. Basically, the White House thinks it's found a way to formalize and legalize cuts made by Elon Musk's Doge Commission. Is it likely to actually work? Can you use this loophole?

Well, Bobby Kogan says the Government Accountability Office is the official arbiter here, and it could challenge the administration in court on this. Marketplace's Nancy Marshall-Genzer. There's news Procter & Gamble is cutting 7,000 jobs worldwide. The firm cites geopolitical volatility and consumer uncertainty taken as an oblique reference to the trade war. ♪

Now to social capital and saving a buck on rebuilding after a disaster. Our Altadena, California house is one of 16,000 structures burnt up in the big wildfires in January. In a video we posted as an excellent Army Corps of Engineers crew cleared our ruins, I muse about the unpredictability of the cost per square foot for rebuilding when there's so much demand for labor and materials.

It used to be maybe $400 a square foot to build from the ground up in that area before the fire. Now some are talking $550, $750. And the higher it goes, the fewer it can afford to rebuild. Now we got multiple comments back from you with this good question. Was there a way homeowners could band together to keep costs down?

By then, a loose-knit group of neighbors was already working on this. It's called the Altadena Collective, which started after the Eaton Fire, among people with small, Tudor-ish cottages built about a century ago. I spoke to one of the community members who helped spearhead that effort, Tim Vortreed, an architect who himself lost his cottage to the fire. I thought, wow, there's a lot of bad information out there. I need to find a way to inform people.

And not by just screaming into the void, which I think we all kind of did a little bit in the beginning. It needs to be in an organized fashion and help people understand what the process is for rebuilding and how many steps you have to take and what the sequence is. That's where we can share purchasing, essentially. These Englishy cottages that many people had, I had one, you had one, both burned.

They had, for instance, many of them distinctive windows. They seem expensive to duplicate, but your idea would be if a whole bunch of people needed windows like that, we might be able to get a price. Yeah, I mean, the way you make a window, let's say you do it out of fiberglass, which is more cost-effective than wood. It's also pretty fire-resilient, which is a good practice these days.

extrude that in bulk and once you say alright this is a funky shape that we have to do a lot of these Jane's Cottages have some very interesting window shapes but if we're doing that 40-50 times you start to make fixtures in the factory that are specific to that shape

And then it becomes an assembly line, even at a small scale. So more efficient, more cost savings. We don't know what's coming tariffs. We don't know what's coming labor. There's a lot in flux in the general economy that affects people in this area as well. However, from the alternate collective perspective, because we're trying to be a resource that helps as much of the community as possible,

Just going into the right people and saying, hey, let's have a dedicated price book for Altadena. And contractors or homeowners will come into you, whether it's raw material or finished material, will come into you and they get this special treatment. That's what we're trying to negotiate. Might be more efficient and you might get a better price if you can go to a builder and say, hey, there's seven houses all on this block that would like to use you.

I think there's two elements that help that. So similarity in the actual structure of the home and proximity. If one contractor is able to lock up three or four adjacent homes or homes within a couple blocks radius,

Their mobilization costs and their logistics significantly reduce. And then they can start to sequence and stage their construction. So a lot of contractors, let's say they have five homes next to each other. They'll have one or two framing crews. One gets two weeks here, the next one gets the next two weeks here.

And then certainly with material drops or deliveries, ordering wood flooring for five homes is so much more cost effective than ordering it for one. These were done fairly cheaply 100 years ago, and we need to take the benefit of that knowledge and replicate it. Tim Vortre, thank you very much. My pleasure.

We're speaking about a community group that's arisen from the fires called the Altadena Collective. Marketplace APM on Facebook, Instagram and TikTok have videos with what I'm learning from those fires in Los Angeles. I'm David Brancaccio with the Marketplace Morning Report from APM American Public Media.

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