Congress does have the power to defund any federal agency, even an agency funded through fees, the Congressional Research Service determined in a letter released last week.
The letter, requested by a Republican lawmaker, addressed an issue raised by House Appropriations Chairman Hal Rogers (R-KY), who has claimed it is impossible for Republicans to defund Obama's amnesty since the agency in charge of issuing the work permits, the United Stated Citizenship and Immigration Services office, is almost entirely funded by user fees.
The CRS found that Rogers' claim was completely false. From the letter:
In light of Congress's constitutional power over the purse, the Supreme Court has recognized that "Congress may always circumscribe agency discretion to allocate resources by putting restrictions in the operative statutes." Where Congress has done so, "an agency is not free simply to disregard statutory responsibilities. Therefore, if a statute were enacted which prohibited appropriated funds from being used for some specified purposes, then the relevant funds would be unavailable to be obligated or expended for those purposes.
A fee-funded agency or activity typically refers to one in which the amounts appropriated by Congress for that agency or activity are derived from fees collected from some external source. Importantly, amounts received as fees by federal agencies must still be appropriated by Congress to that agency in order to be available for obligation or expenditure by the agency. In some cases, this appropriation is provided through the annual appropriations process. In other instances, it is an appropriation that has been enacted independently of the annual appropriations process (such as a permanent appropriation in an authorizing act). In either case, the funds available to the agency through fee collections would be subject to the same potential restrictions imposed by Congress on the use of its appropriations as any other type of appropriated funds.
Incoming-House Budget Committee Chairman Tom Price (R-GA) is already laying the groundwork for Congress to defund Obama's amnesty sometime early next year. House Republicans would pass a long-term funding bill for most of the federal government this December, but would not include agencies that dealt with illegal immigration in that bill. They would then pass a separate bill that funded those agencies, but only on a short-term basis.
This would allow Republicans to fight Obama's amnesty early next year when they have control of both the House and the Senate.