Order Code RS20371
Updated March 5, 2001
CRS Report for Congress
Received through the CRS Web
Overview of the Authorization-
Appropriation Process
Bill Heniff Jr.
Analyst in American National Government
Government and Finance Division
A primary avenue for exercising Congress’s power of the purse is the authorization
and appropriation of federal spending to carry out government activities. While the power
over appropriations is granted to Congress by the U.S. Constitution, the authorization-
appropriation process is derived from House and Senate rules. The formal process
consists of two sequential steps: (1) enactment of an authorization measure that may
create or continue an agency or program as well as authorize the subsequent enactment
of appropriations, and (2) enactment of appropriations to provide funds for the authorized
agency or program.1
The authorizing and appropriating duties in this two-step process are carried out by
a division of labor within the committee system. Legislative committees, such as the
House Committee on Armed Services and the Senate Committee on Commerce, Science,
and Transportation, are responsible for authorizing legislation related to the agencies and
programs under their jurisdiction; most standing committees have authorizing
responsibilities. The Appropriations Committees of the House and Senate have
jurisdiction over appropriation measures. As discussed below, House and Senate rules
generally prohibit the encroachment of these committee responsibilities by the authorizers
and appropriators.
Agencies and programs funded through the annual appropriation process, referred
to as discretionary spending, generally follow this two-step process. Not all federal
agencies and programs, however, are funded through this authorization-appropriation
process. Funding for some agencies and programs is provided by the authorizing
legislation, bypassing this two-step process. Such spending, referred to as direct spending,
currently constitutes about two-thirds of all federal spending. Some direct spending,
mostly entitlement programs, is funded by permanent appropriations in the authorizing
law. Other direct spending (referred to as appropriated entitlements), such as Medicaid,
is funded in appropriation acts, but the amount appropriated is controlled by the
authorizing legislation
1 For a more thorough discussion of this process, see: U.S. Library of Congress, Congressional
Research Service, Manual on the Federal Budget Process, by Robert Keith and Allen Schick, CRS
Report 98-720 GOV (Washington: August 28, 1998), chapters 6 and 7.
Congressional Research Service ˜ The Library of Congress

---

CRS-2
.Authorizing Legislation
An authorizing measure can establish, continue, or modify an agency or program for
a fixed or indefinite period of time. It also may set forth the duties and functions of an
agency or program, its organizational structure, and the responsibilities of agency or
program officials.
Authorizing legislation also authorizes the enactment of appropriations for an agency
or program. The amount authorized to be appropriated may be specified for each fiscal
year or may be indefinite (providing “such sums as may be necessary”). The authorization
of appropriations is intended to provide guidance regarding the appropriate amount of
funds to carry out the authorized activities of an agency.
Appropriation Measures
An appropriation measure provides budget authority to an agency for specified
purposes. Budget authority allows federal agencies to incur obligations and authorizes
payments to be made out of the Treasury. Discretionary agencies and programs, and
appropriated entitlement programs, are funded each year in appropriation acts.
The 13 subcommittees of the Appropriations Committees of the House and Senate
are each responsible for one of the regular appropriation acts. The regular appropriation
acts provide budget authority for the next fiscal year, beginning October 1. Congress
usually adopts one or more supplemental appropriation acts to provide additional funding
for unexpected needs while the fiscal year is in progress. If the regular appropriation acts
are not completed by October 1, then Congress must adopt a continuing appropriation
act, commonly referred to as a continuing resolution, providing stop-gap funding. In some
years, instead of adopting the regular appropriation measures individually, Congress may
include several in an omnibus appropriation measure, or a continuing appropriation bill
providing funding for the full fiscal year.
Enforcing the Authorization-Appropriation Process
The separation between the two steps of the authorization-appropriation process is
enforced through points of order provided by rules of the House and Senate. First, the
rules prohibit appropriations for unauthorized agencies and programs; an appropriation in
excess of an authorized amount is considered an unauthorized appropriation. Second, the
rules prohibit the inclusion of legislative language in appropriation measures. Third, the
House, but not the Senate, prohibits appropriations in authorizing legislation.
While the rules encourage the integrity of the process, a point of order must be raised
to enforce the rules. Also, the rules may be waived by suspension of the rules, by
unanimous consent, or, in the House, by a “special rule.” If unauthorized appropriations
are enacted into law through circumvention of House and Senate rules, in most cases the
agency may spend the entire amount.

---