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Updated December 30, 2019
Foreign Affairs Overseas Contingency Operations (OCO)
Funding: Background and Current Status
Congressional interest in Overseas Contingency Operations
For the first foreign affairs OCO appropriation in FY2012
(OCO) funding levels has continued as Members debate
(P.L. 112-74, Div. I, Title VIII), Congress provided funds
annual foreign affairs and defense budgets. A key feature of
for a wide range of recipients beyond the three frontline
OCO funds is their effective exemption, like emergency
states, including Yemen, Somalia, Kenya, and the
funds, from the discretionary spending limits established by
Philippines. In addition to country-specific uses, Congress
the Budget Control Act of 2011 through FY2021 (BCA,
also appropriated funds for the Global Security
P.L. 112-25). Some Members have suggested that this
Contingency Fund. In the FY2013 full-year continuing
exemption provides agencies with additional budget
appropriations (P.L. 113-6, Div. F, Title VII, Sec. 1707-
cushioning and flexibility, allowing defense and nondefense
1708), Congress specified only Jordan as an additional
foreign affairs funding to exceed the spending caps. Others
OCO-recipient country.
have criticized the OCO designation, labeling it as a “slush
fund” that provides funds for programs unrelated to
Figure 1. Foreign Affairs Overseas Contingency
contingency operations.
Operations, FY2012-FY2020
(in bil ions of U.S. dol ars)
In the Bipartisan Budget Act of 2019 (BBA 2019, P.L. 116-
37), Congress raised the overall discretionary spending
limits for FY2020 and FY2021, the last two years in which
the BCA caps are in effect. BBA 2019 also included
nonbinding targets for OCO funding in both FY2020 and
FY2021; defense OCO targets were set at $71.5 billion for
FY2020 and $69 billion for FY2021, while the foreign
affairs OCO targets were set at $8 billion for each fiscal
year. The Trump Administration has not requested OCO
funding for foreign affairs since FY2018. (In FY2019, the
Administration initially requested $12 billion for foreign
affairs OCO, but following passage of the 2018 Bipartisan
Budget Agreement (P.L. 115-123), it issued an addendum
requesting that all foreign affairs OCO be shifted to base
funding.)
Source: Department of State Congressional Budget Justifications,
FY2014-FY2020, P.L. 115-141, P.L. 116-6, and P.L. 116-94. The totals
While ongoing debate in Congress over OCO may focus on
enacted include net rescissions.
defense spending (where the largest share of OCO funds are
appropriated), foreign affairs OCO funding may continue to
For FY2014 (P.L. 113-76, Div. K, Title VIII), Congress
play a role in the international affairs budget.
provided four accounts with no-year (available until
expended) OCO funds, but made most foreign affairs OCO
Background on Foreign Affairs OCO
funds available for two years—or until September 30, 2015.
The foreign affairs agencies began requesting OCO funding
Congress also expanded the terms of transfer authority,
in FY2012, distinguishing between what is referred to as
providing greater flexibility across certain accounts. It also
enduring (ongoing costs) versus extraordinary, temporary
authorized transfers from those accounts to International
costs of State and USAID in the frontline states of Iraq,
Disaster Assistance (IDA) and Migration and Refugee
Afghanistan, and Pakistan. Many view this approach as
Assistance (MRA) accounts, subject to certain dollar
similar to the annual emergency supplemental
amounts or percentages, and regular notification
appropriations to support the Global War on Terrorism
procedures. FY2014 OCO-funded activities were
(GWOT) in the frontline states during the George W. Bush
implemented in Iraq, Afghanistan, Pakistan, Jordan,
Administration. Congress, having provided OCO funds for
Lebanon, the Central African Republic, and Somalia.
the Department of Defense (DOD) earlier, adopted this
approach for foreign affairs, although it never permanently
For FY2015 (P.L. 113-235, Div. J, Title VIII), although
defined its uses in statute. Since 2012, Congress has
Congress did not provide specific OCO funds for
appropriated more foreign affairs OCO funds than were
countering the Islamic State (IS), as was requested by the
requested each year and authorized its use for various
Obama Administration, it did provide an increase in OCO
functions (see Table 1).
funds in many accounts with language that allowed it to be
used for counterterrorism. The Obama Administration
requested an expanded use of OCO funds for Syria and
peacekeeping in FY2016 (P.L. 114-113, Div. K, Title VIII)
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Foreign Affairs Overseas Contingency Operations (OCO) Funding: Background and Current Status
and FY2017 (P.L. 115-31, Div. J, Title VIII). Congress also
counterinsurgency efforts.” The OCO designation has
provided OCO funding in both years for Ebola, Zika,
arguably devolved into a mechanism that has enabled
counterterrorism, and countering Russian aggression.
Congress and prior Administrations to increase spending on
regular operations while technically complying with BCA
The FY2018 (P.L. 115-141, Div. K, Title VIII) and FY2019
budget caps. The Trump Administration, meanwhile, has
(P.L. 116-6, Div. F, Title VIII) foreign affairs OCO
repeatedly requested significant budget cuts for
appropriations included funds to address global refugee
international affairs activities and has not sought OCO
responses and to support assessed peacekeeping
funds for this purpose. Perhaps reflecting these conflicting
contributions for operations in Somalia, among other
approaches, OCO as a share of the international affairs
activities.
budget has declined in recent years, from a peak of 36% in
FY2017 to 15% in FY2020 (see Figure 2).
Within the Further Consolidated Appropriations Act, 2020
(P.L. 116-94, Div. G), Congress appropriated a total of
Figure 2. OCO & Emergency Supplemental Funding
$54.8 billion for the Department of State, Foreign
as a Share of Total International Affairs Budget
Operations and Related Programs (SFOPS) appropriation:
(in bil ions of current U.S. dol ars)
$47.1 billion for base or enduring funds and $8.0 billion
(nearly 15% of total SFOPS funds) for OCO, as well as
approximately $296 million in rescissions. Unlike previous
fiscal years, the FY2020 act did not have OCO designated
as a separate title of the bill; rather, OCO levels were
embedded in select appropriations accounts throughout the
legislation. Table 1 below details enacted OCO funding
levels by account for FY2020:
Table 1. FY2020 Foreign Affairs OCO Funding Levels
(in millions of U.S. dol ars)
Total
8,000.0
Appropriated Funds
Worldwide Security Protection (within Diplomatic
Source: Department of State Congressional Budget Justifications,
2,626.1
Programs)
FY2014-FY2020, P.L. 115-141, P.L. 116-6, and P.L. 116-94. The totals
State Department Office of Inspector General
54.9 enacted include net rescissions.
Worldwide Security Upgrades (within Embassy
Notes: * indicates years in which funding includes more than OCO.
424.1
Security, Construction and Maintenance)
FY2015 includes the Ebola Response Supplemental Funding (P.L. 113-
235); FY2016 includes the Zika Response Supplemental Funding (P.L.
Contributions to International Organizations (CIO)
96.2 114-223); and FY2017 includes the Security Assistance
Contributions for International Peacekeeping
988.7 Appropriations Act (P.L. 114-254) OCO funding.
International Disaster Assistance (IDA)
1,734.0
Migration and Refugee Assistance (MRA)
1,521.4 As BCA discretionary spending caps are set to expire after
Peacekeeping Operations (PKO)
325.2 FY2021, the use of OCO as a foreign affairs funding
mechanism may change. Congress may continue the
Foreign Military Financing (FMF)
511.9 downward trend in use of the OCO designation, using OCO
Rescissions
funds only for extraordinary contingency programs, as in
Embassy Security, Construction and Maintenance
(242.5) the past. Alternatively, Congress may phase out the use of
foreign affairs OCO entirely, instead integrating OCO
Complex Crises Fund (CCF)
(40.0) funding for regular operations into the base budget and
Source: Further Consolidated Appropriations Act, 2020, P.L. 116-
relying on emergency supplemental appropriations to
94, Div. G.
address out-of-cycle, unanticipated needs, as was the norm
Note: Numbers within parentheses are negative.
prior to use of the OCO designation.
The Future of Foreign Affairs OCO
More Information
OCO has consistently been described by Congress as
For more information on OCO and the foreign affairs
supporting extraordinary budget needs, even as the use of
budget, see CRS Report R44519, Overseas Contingency
the designation has expanded over the years to apply to an
Operations Funding: Background and Status, and CRS
increasing range of activities, many of which are not
Report R45763, Department of State, Foreign Operations,
directly related to active conflicts. According to the joint
and Related Programs: FY2020 Budget and
explanatory statement accompanying final FY2020
Appropriations.
appropriations, “[OCO] funds are intended to address the
extraordinary costs of operations and assistance in countries
Emily M. Morgenstern, Analyst in Foreign Assistance and
in conflict and areas of instability and violence, particularly
Foreign Policy
for security, stabilization, and peacekeeping programs;
humanitarian activities; and counterterrorism and
IF10143
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Foreign Affairs Overseas Contingency Operations (OCO) Funding: Background and Current Status
Disclaimer
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