POLSC232: American Government

President Submits Budget

The President initiates the annual budget cycle with the submission of an annual budget proposal for the upcoming fiscal year to Congress. The President is required to submit the annual budget on or before the first Monday in February. Congress has, however, provided deadline extensions both statutorily and, sometimes, informally.

The President recommends spending levels for various programs and agencies of the federal government in the form of budget authority (or BA). Such authority does not represent cash provided to or reserved for agencies. Instead, the term refers to the authority provided by federal law to enter into contracts or other financial obligations that will result in immediate or future expenditures (or outlays) involving federal government funds. Most appropriations are a form of budget authority that also provides the legal authority to make subsequent payments from the Treasury.

An FY2016 appropriations act, for example, provided $77,349,000 in new budget authority for FY2016 to the National Institute of Environmental Health Sciences for agency operations.9 That is, the act gave the institute legal authority to sign contracts to purchase supplies and pay salaries. The agency could not commit the government to pay more than the $77 million provided for these covered activities. The outlays occur when government payments are made.

The budget authority must be obligated in the fiscal year(s) in which the funds are made available, but outlays may occur over time. In the case of the institute's activities, it may not pay for all the supplies until the following fiscal year.

The amount of outlays in a fiscal year may vary among activities funded because the length of time to complete the activities differs. For example, outlays to pay salaries may occur in the year the budget authority is made available, while outlays for a construction project may occur over several years as various stages of the project are completed.

As Congress considers appropriations measures providing new budget authority for a particular fiscal year, discussions on the resulting outlays involve estimates based on historical trends. Data on the actual outlays for a fiscal year are not available until the fiscal year has ended.

After the President submits the budget proposal to Congress, each agency generally provides additional detailed justification materials to the House and Senate appropriations subcommittees with jurisdiction over its funding.

Congress Adopts Budget Resolution

The Congressional Budget and Impoundment Control Act of 1974 (CBA) provides for the annual consideration of a concurrent resolution on the budget. The budget resolution is Congress's response to the President's budget. It is a concurrent resolution because it is an agreement between the House and Senate that establishes overall budgetary and fiscal policy to be carried out through subsequent legislation. The budget resolution must cover at least five fiscal years: the upcoming fiscal year (referred to as the "budget year") plus the four subsequent fiscal years.

The budget resolution, in part, sets total new budget authority and outlay levels for each fiscal year covered by the resolution. It also allocates federal spending among 20 functional categories (such as national defense, agriculture, and transportation), setting budget authority and outlay levels for each function.

Within each chamber, the total new budget authority and outlays for each fiscal year are also allocated among committees with jurisdiction over spending, thereby setting spending ceilings for each committee. The House and Senate Committees on Appropriations receive allocations only for the upcoming fiscal year, because appropriations measures are annual. Once the appropriations committees receive their spending ceilings, they separately subdivide the amount among their respective subcommittees, providing spending ceilings for each subcommittee.

The budget resolution is not sent to the President and does not become law. It does not provide budget authority or raise or lower revenues; instead, it is a guide for the House and Senate as they consider various budget-related bills, including appropriations and tax measures. Both the House and Senate have established parliamentary rules to enforce some of these spending ceilings when legislation is considered on the House or Senate floor, respectively.

These spending ceilings for the upcoming fiscal year may be enforced through points of order during House consideration of each appropriation measure. During Senate consideration of each appropriations bill, the total new budget authority and outlay levels for the upcoming fiscal year as well as the subcommittee spending ceilings - but not the committee ceilings - may be enforced.

The CBA establishes April 15 as the target date for congressional adoption of the budget resolution. Since FY1977, Congress has frequently not met this target date. In many instances in recent years (FY1999, FY2003, FY2005, FY2007, FY2011-FY2015, and FY2017), Congress did not adopt a budget resolution.

There is no penalty if the budget resolution is not completed before April 15 or not at all. Under the CBA, however, certain enforceable spending ceilings associated with the budget resolution are not established until the budget resolution is completed. The act also prohibits both House and Senate floor consideration of appropriations measures for the upcoming fiscal year before Congress completes the budget resolution and, in the Senate, before the Senate Appropriations Committee receives its spending ceilings. The CBA allows the House, however, to consider most appropriations measures after May 15, even if the budget resolution has not been adopted by Congress. The Senate may adopt a motion to waive this CBA requirement for spending ceilings by a majority vote.

If Congress delays completion of the annual budget resolution (or does not adopt one), each chamber may adopt a deeming resolution to address these procedural difficulties.

Timetable for Consideration of Appropriations Measures

The timing of the various stages of the appropriations process tends to vary from year to year. Although timing patterns for each stage tend to be discernible over time, certain anomalies from these general patterns occur in many years.

Traditionally, the House of Representatives initiated consideration of regular appropriations measures, and the Senate subsequently considered and amended the House-passed bills. More recently, the Senate appropriations subcommittees and committee have sometimes not waited for the House bills; instead they have reported original Senate bills. Under this more recent approach, the House and Senate appropriations committees and their subcommittees have often considered the regular bills simultaneously.

The House Appropriations Committee reports the 12 regular appropriations bills separately to the full House. The committee generally reports the bills in May and June. Generally, the full House starts floor consideration of the regular appropriations bills in May or June as well.

The Senate Appropriations Committee typically begins reporting the bills in June and generally completes committee consideration prior to the August recess. The Senate typically begins floor consideration of the bills beginning in June or July.

Consideration by the full House and Senate may continue through the fall. While Congress has traditionally considered and approved each regular appropriations bill separately, delays in their consideration may mean that one or more appropriations measures may not receive separate initial consideration in one or both chambers and that several appropriations bills may subsequently get combined into a single legislative vehicle prior to enactment, referred to as omnibus appropriations measures.

If this process is not completed prior to the start of the fiscal year (October 1), Congress may need to enact one or more measures to provide temporary funding authority pending the final disposition of the regular appropriations bills, either separately or as part of an omnibus measure. Because budget authority is typically provided for a single fiscal year, temporary funding measures are necessary if action on a regular appropriations measure has not been completed prior to the beginning of a fiscal year in order to prevent a funding gap that could require an agency to cease non-excepted activities. Traditionally, temporary funding has been provided in the form of a joint resolution to allow agencies or programs to continue to obligate funds at a particular rate (such as the rate of operations for the previous fiscal year) for a specific period of time, which may range from a single day to an entire fiscal year. These measures are known as continuing resolutions (or CRs).

Work of the Appropriations Committees

After the President submits the budget, the House and Senate appropriations subcommittees hold hearings on the segments of the budget under their jurisdiction. They focus on the details of the agencies' justifications, which provide supporting materials to the budget submission. The hearings, at which primarily agency officials testify, may also be supplemented by meetings and communications between the subcommittee staff and agency officials. At the same time, the subcommittees may solicit requests from Members of Congress for programmatic levels and language to be included in the appropriations bills and committee reports.

After conducting these hearings, the House and Senate Appropriations Committees make their suballocations, and the subcommittees begin to draft, mark up, and report the regular bills under their jurisdiction to their respective full committees. Both Appropriations Committees consider each subcommittee's recommendations separately. The committees may adopt amendments to a subcommittee's recommendations prior to reporting the bills and making them available for further consideration by their respective chambers.

House Floor Consideration

Prior to floor consideration of an appropriations bill, the House almost always considers a special rule reported by the House Rules Committee setting parameters for floor consideration of the bill. If the House adopts the special rule, it usually considers the appropriations bill soon thereafter.

The House considers the bill in the Committee of the Whole House on the State of the Union (or Committee of the Whole), of which all Representatives are members. A special rule on an appropriations bill usually provides for one hour of general debate on the bill. The debate includes opening statements by the chair and ranking minority member of the appropriations subcommittee with jurisdiction over the regular bill, as well as other interested Representatives.

After the Committee of the Whole debates the bill, it considers amendments. The appropriations bill is generally read for amendment, by paragraph. Amendments to general appropriations bills are governed by a variety of requirements:

• House standing rules and precedents that establish several requirements applicable to all types of measures, such as requiring amendments to be germane to the bill;
  
• House standing rules and precedents that establish a separation between appropriations and other legislation;
• Separate orders establishing certain requirements, such as those requiring a "spending reduction account" section in each regular appropriations bill and limiting permissible amendments to that section;
  
• Spending limits imposed by the congressional budget process (see "Allocations and Other Limits on Appropriations Associated with the Budget Resolution" below); and
• Provisions of a special rule or unanimous consent agreement providing for consideration of a particular appropriations bill.
  

If an amendment violates any of these requirements, any Representative may raise a point of order to that effect. These points of order are not self-enforcing. A Member must raise a point of order that an amendment violates a specific rule. If the presiding officer rules the amendment out of order, it cannot be considered by the House. A special rule or unanimous consent agreement, however, may waive requirements imposed by House rules or the budget process, thereby allowing the House to consider the amendment.

During consideration of individual appropriations bills, the House sometimes sets additional parameters, either by adopting a special rule or by unanimous consent. For example, the House has sometimes agreed to limit consideration to a specific list of amendments or to limit debate on individual amendments by unanimous consent.

After the Committee of the Whole completes consideration of the measure, it rises and reports the bill and any amendments that have been adopted to the full House. The House then votes on the amendments and final passage. After House passage, the bill is sent to the Senate.

Senate Floor Consideration

The recent practice has been for the full Senate to consider the text of a bill as reported by its Appropriations Committee in the form of a substitute to the House-passed appropriations bill. The Senate does not have a device like a special rule to set parameters for consideration of bills by majority vote. Before taking up the bill, however, or during its consideration, the Senate sometimes sets parameters by unanimous consent.

When the bill is brought up on the floor, the chair and ranking minority member of the appropriations subcommittee make opening statements on the contents of the bill as reported.

Committee and floor amendments to the reported bills must meet requirements established under the Senate standing rules and precedents and congressional budget process as well as any requirements agreed to by unanimous consent. The specifics of the Senate and House rules for general appropriations bills differ, including the waiver procedures, but include the following common themes:

• Separate consideration of legislation and appropriations; and
  
• Enforcement of the spending limits imposed by the congressional budget process.
  

The Senate generally does not require that amendments be considered in the order of the bill. Senators may propose amendments to any portion of the bill at any time it is pending unless the Senate agrees to set limits.

House and Senate Conference Action

The Constitution requires that the House and Senate approve the same measure in precisely the same form before it may be presented to the President for his signature or veto. Consequently, once the House and Senate have both completed initial consideration of an appropriations measure, the Appropriations Committees in each chamber will endeavor to negotiate a resolution of the differences between their respective versions. The practice has generally been for the House and Senate to convene a conference committee to resolve differences between the chambers on appropriations bills. Alternatively, agreement may be reached through an exchange of amendments between the houses.

In current practice, the Senate typically passes the House bill with the Senate version attached as a single substitute amendment. As a result, the House and Senate resolve their differences based on disagreement on the measure as a whole. Members of the House and Senate appropriations subcommittees having jurisdiction over a particular regular appropriations bill, as well as the chair and ranking minority members of the full committees, are designated as conferees or managers and tasked with meeting to negotiate over differences between the House- and Senate- passed versions.

The purpose of the negotiations is to resolve differences between the two chambers, and therefore House and Senate rules generally require conferees to negotiate within the scope of the differences on those matters in disagreement. Additionally, they may not include in the conference report new directed spending provisions, defined as

Completion of the conference report is not on a specified timeline, so negotiations are concluded only when a majority of the conferees from each chamber sign the conference report. Once conferees reach agreement on all points of difference, they report the conference report, which proposes a new conference substitute for the bill as a whole. In addition, the conference report includes a joint explanatory statement (or managers' statement) explaining the new substitute. A conference report may not be amended in either chamber.

Usually, the House considers conference reports on appropriations measures first. The first chamber to consider the conference report may vote to adopt it, reject it, or recommit it to the conference for further consideration. After the first house adopts the conference report, the conference is automatically disbanded; therefore, the second house has two options - to adopt or reject the conference report. In cases in which the conference report is either rejected or recommitted to the conference committee, the two chambers may negotiate further over the matters in dispute. The measure cannot be sent to the President until both houses have agreed to the entire text of the bill.

The rules governing the content of the conference report may be enforced or waived during House and Senate consideration of it. Prior to consideration of the conference report, the House typically adopts a special rule waiving all points of order against the conference report or its consideration. In the Senate, such points of order may be waived through unanimous consent or (in some cases) motions to waive. If a point of order is sustained, the conference report falls.

A mechanism is available, however, through which new matters or new directed spending provisions included in a conference report can be stricken while the remaining provisions are effectively retained for further Senate consideration. If the presiding officer sustains a point of order against new matter or one or more new directed spending provisions, the offending language is stricken from the conference report. After all points of order under both requirements have been disposed of, the Senate considers a motion to send the remaining provisions to the House as an amendment between the houses since the changed legislative text can no longer be considered as a conference report. The House would then consider the amendment. The House may choose to further amend the Senate amendment and return it to the Senate for further consideration. If the House, however, agrees to the amendment, the measure is cleared for presidential action. Alternatively, the Senate may choose to retain such provisions by voting to waive these points of order. To succeed, the motion must be adopted by a three-fifths vote of all Senators duly chosen and sworn (60 Senators if there are no vacancies). An appeal of a ruling by the presiding officer on one of these points of order would also require a vote of three-fifths of all Senators.

Presidential Action

Under the Constitution, after a measure is presented to the President, he has ten days to sign or veto the measure. If he takes no action, the bill automatically becomes law at the end of the 10-day period if Congress is in session. Conversely, if he takes no action when Congress has adjourned, he may pocket veto the bill.

If the President vetoes the bill, he sends it back to Congress. Congress may override the veto by a two-thirds vote in both houses. If Congress successfully overrides the veto, the bill becomes law. If Congress is unsuccessful, the bill dies.