November 29, 2018
Budgetary Decisionmaking in Congress
Understanding the Congressional Budget
Process
Anticipating what may occur within an upcoming
The Constitution grants Congress the power of the purse. It
annual congressional budget cycle requires
does not, however, establish specific types of budgetary
consideration of the varying types of legislative
legislation or procedures by which Congress must consider
opportunities and their specific constraints, as well as
such legislation. Instead, Congress has developed certain
the ever-changing practical and political influences
types of budgetary measures as well as rules and practices
inherent in budgetary decision-making.
that govern the content and consideration of budgetary
legislation under each chamber’s constitutional authority to

“determine the Rules of its Proceedings.” There is no
prescribed process, however, that must be strictly followed
Primary Types of Legislation Used by
each year.
Congress to Affect the Budget
Below is a summary of general types of budgetary
legislation that Congress typically uses.
The congressional budget process may be better
understood not as a definite set of actions that must
The Budget Resolution
occur annually but instead as an array of potential
The annual budget resolution reflects an agreement between
legislative opportunities for affecting the federal
the House and Senate on a budgetary framework. It is
budget.
privileged for fast-track consideration—particularly in the
Senate—and therefore does not require support of three-

fifths of Senators. The budget resolution does not become
law, and therefore no money is spent or collected as a result
Within the assortment of legislative opportunities available
of its adoption. Instead, it is meant to assist Congress in
to Congress for making changes to the federal budget, great
executing an overall budget plan. It is under the jurisdiction
variation exists. For example, some types of legislation may
of the House and Senate Budget Committees, and its
create or alter programs, while other legislation provides a
content, consideration, and implementation are shaped
program’s funding. Further, some legislation does not
primarily by the Congressional Budget Act of 1974.
spend or collect money at all but instead reflects a
budgetary plan to be implemented through subsequent
Direct Spending Legislation
legislation.
Direct spending programs are generally federal programs
that provide payments to those beneficiaries that meet the
When Congress uses such legislative opportunities, varying
requirements established by law. Such programs—also
requirements and restrictions may shape their actions.
referred to as mandatory spending programs or entitlement
These requirements and restrictions are derived from a
programs—generally continue annually without any
continually growing patchwork of rules, laws, constitutional
congressional action required. Most legislative committees
requirements, and customs that have developed over the
have jurisdiction over some type of direct spending
past two centuries. Adding complexity to the process is the
program. The content and consideration of direct spending
fact that different requirements and restrictions apply to
legislation are shaped primarily by House and Senate rules,
different types of budgetary legislation.
the budget resolution, and the Budget Act. Each year,
Congress typically considers legislation that affects direct
This variation—both in the type of budgetary measure and
spending in varying degrees.
the particular rules and requirements specific to them—can
sometimes cause confusion. Adding to this confusion is the
Appropriations Legislation
fact that Congress seldom considers budgetary measures
Spending not mandated by existing law is determined in
each year in a predictable pattern. Such dissimilarity can be
appropriations legislation that authorizes agencies to
the result of countless factors, such as political dynamics,
obligate a specific amount of money and directs the
competing budgetary priorities, the economy, natural
Treasury to make the payments for such obligations.
disasters, and military engagements. These factors not only
Appropriations in some form must be enacted by the
shape congressional priorities but can also create
beginning of a new fiscal year (October 1) or a government
complications, obstacles, and interruptions within the
shutdown may occur. Appropriations, also known as
policymaking process.
discretionary spending, are under the jurisdiction of the
Appropriations Committee. The appropriations process
contemplates annual enactment of 12 regular appropriations
bills providing funding for various categories of federal
programs, but Congress regularly employs continuing
resolutions to continue funding programs in the absence of

www.crs.gov | 7-5700

---

Budgetary Decisionmaking in Congress
the enactment of regular appropriations measures. The
enforcement in the form of a sequester that requires
content and consideration of appropriations measures are
automatic spending cuts in the event the specified
shaped primarily by House and Senate rules, levels in the
budgetary requirement is violated. In addition, Congress
budget resolution, the Budget Act, and statutory limits on
has sometimes developed language proposing to amend the
annual discretionary spending.
Constitution to create specific budgetary objectives. Such
budget enforcement legislation is primarily within the
Authorizations of Appropriations Legislation
jurisdiction of the House and Senate Budget Committees
Authorization legislation establishes, continues, or alters a
and often the Rules Committees as well. Consideration of
federal program and creates the legal foundation for the
such legislation is shaped primarily by House and Senate
program’s existence, but it does not provide the program’s
Rules as well as the Budget Act.
funding. Funding is provided separately by appropriations
measures, described above. Most legislative committees
Debt Limit Legislation
have jurisdiction over such authorizations. The content and
Federal debt accumulates as the Treasury sells debt to
consideration of authorizing legislation are shaped
finance federal obligations during a deficit and issues debt
primarily by House and Senate rules as well as House
to government accounts (such as the Social Security,
leadership protocols. Each year Congress passes legislation
Medicare, and Transportation trust funds) as required by
creating or altering some federal programs in varying
law. The debt issued by the Treasury is controlled by
degrees.
legislation in the form of (1) a limit on total debt permitted
to be issued by the Treasury or (2) a suspension of the debt
Revenue Legislation
limit through a specified period. A debt limit suspension
Revenue legislation provides authority for the collection of
will expire on March 1, 2019, reinstating the debt limit at a
taxes and tariffs to fund the federal government. Most
level that accommodates the debt incurred during the
revenue is collected by the federal government as a result of
suspension period. The House Ways and Means Committee
previously enacted law that continues in effect without any
and the Senate Finance Committee have jurisdiction over
need for congressional action. Congress, however, routinely
debt limit legislation generally. Consideration of debt limit
considers revenue legislation that repeals existing
legislation is shaped largely by House and Senate rules as
provisions, extends expiring provisions, or creates new
well as the budget resolution and the Budget Act.
provisions. The Constitution requires that revenue
legislation originate in the House. Generally revenue is
Megan S. Lynch, mlynch@crs.loc.gov, 7-7853
under the jurisdiction of the House Ways and Means
Committee and the Senate Finance Committee. The content
IF11032
and consideration of revenue measures is shaped primarily
by House and Senate rules and the budget resolution. Each
year Congress passes legislation that affects revenue in
varying degrees.
Budget Reconciliation Legislation
Budget reconciliation legislation is developed and
considered as a result of reconciliation directives included
in the budget resolution. Reconciliation legislation may
include legislative language concerning direct spending,
revenue, and changes to the debt limit developed by
legislative committees as a result of these directives, and it
is eligible for consideration under expedited legislative
procedures. The content and consideration of budget
reconciliation legislation is shaped primarily by the budget
resolution and the Budget Act.
Budget Enforcement Legislation
Congress may consider legislation designed to create new
methods of budget enforcement or alter existing budget
enforcement mechanisms. Such budgetary restrictions can
take many forms. If they are to be enforced internally by the
House and Senate, they may be added to the House and
Senate rules or included in a rule-making statute that
becomes law. Congress has typically incorporated some
type of internal budget enforcement in each recent
Congress. Congress has also passed legislation that creates
budgetary requirements that are enforced outside of the
House and Senate. For example, in 2010 Congress passed
the Statutory Pay-As-You-Go Act, and in 2011 Congress
passed the Budget Control Act. Both laws articulated
certain budgetary objectives as well as statutory
www.crs.gov | 7-5700

---