The Budget Control Act: Frequently Asked Questions

Updated October 1, 2019 (R44874)
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Summary

When there is concern with deficit or debt levels, Congress will sometimes implement budget enforcement mechanisms to mandate specific budgetary policies or fiscal outcomes. The Budget Control Act of 2011 (BCA; P.L. 112-25), which was signed into law on August 2, 2011, includes several such mechanisms.

The BCA as amended has three main components that currently affect the annual budget. One component imposes annual statutory discretionary spending limits for defense and nondefense spending. A second component requires annual reductions to the initial discretionary spending limits triggered by the absence of a deficit reduction agreement from a committee formed by the BCA. Third are annual automatic mandatory spending reductions triggered by the same absence of a deficit reduction agreement. Each of those components is described in further detail in this report. The discretionary spending limits (and annual reductions) are currently scheduled to remain in effect through FY2021, while the mandatory spending reductions are scheduled to remain in effect through FY2029.

Congress may modify or repeal any aspect of the BCA procedures, but such changes require the enactment of legislation. Several pieces of legislation have changed the spending limits or enforcement procedures included in the BCA with respect to each year from FY2013 through FY2029. These include the American Taxpayer Relief Act of 2012 (ATRA; P.L. 112-240), the Bipartisan Budget Act of 2013 (BBA 2013; P.L. 113-67, also referred to as the Murray-Ryan agreement), the Bipartisan Budget Act of 2015 (BBA 2015; P.L. 114-74), the Bipartisan Budget Act of 2018 (BBA 2018; P.L. 115-123), and the Bipartisan Budget Act of 2019 (BBA 2019; P.L. 116-37).

Those laws included changes to the discretionary limits imposed by the BCA that increased deficits in each year from FY2013 to FY2021. Under current law there are no discretionary spending caps in place for FY2022 and beyond. Following enactment of BBA 2019, the discretionary caps in FY2020 are scheduled to be approximately $667 billion for defense activities and $622 billion for nondefense activities, and the FY2021 discretionary caps are scheduled to be $672 billion for defense activities and $627 billion for nondefense activities.

This report addresses several frequently asked questions related to the BCA and the annual budget.


1. What is the BCA?

When there is concern with deficit or debt levels, Congress will sometimes implement budget enforcement mechanisms to mandate specific budgetary policies or fiscal outcomes. The Budget Control Act of 2011 (BCA; P.L. 112-25) was the legislative result of extended budget policy negotiations between congressional leaders and President Barack Obama. These negotiations occurred in conjunction with the government's borrowing authority approaching the statutory debt limit.1

Budget deficits in FY2009 through FY2011 averaged 9.0% of gross domestic product (GDP) and were higher than any other year since World War II. Those deficits were due to a number of factors, including reduced revenues and increased spending demands attributable to the Great Recession and costs associated with the economic stimulus package passed through the American Recovery and Reinvestment Act of 2009 (P.L. 111-5).2

The BCA includes several interconnected components related to the federal budget, some of which are no longer in effect. There are five primary components:

2. What components of the BCA currently affect the annual budget?

The BCA as amended has three main components that currently affect the annual budget. One component imposes annual statutory discretionary spending limits for defense and nondefense spending. A second component requires annual reductions to the initial discretionary spending limits, triggered by the absence of a deficit reduction agreement from the Joint Committee. Third are annual automatic mandatory spending reductions triggered by the same absence of a deficit reduction agreement. Each of those components is described in further detail below.

Discretionary Spending Limits

The BCA established statutory limits on discretionary spending for FY2012-FY2021.6 (Such discretionary spending limits were first in effect between FY1991 and FY2002.7) There are currently separate annual limits for defense discretionary and nondefense discretionary spending.8 The defense category consists of discretionary spending in budget function 050 (national defense) only. The nondefense category includes discretionary spending in all other budget functions.

If discretionary appropriations are enacted that exceed a statutory limit for a fiscal year, across-the-board reductions (i.e., sequestration) of nonexempt budgetary resources within the applicable category are required to eliminate the excess spending. The BCA further stipulates that some spending is effectively exempt from the limits. Specifically, the BCA specifies that the enactment of certain discretionary spending—such as appropriations designated as emergency requirements or for overseas contingency operations—allows for an upward adjustment of the discretionary limits (meaning that such spending is effectively exempt from the limits).9

Annual Reductions to the Discretionary Spending Limits

Another component of the BCA requires reductions to these discretionary spending limits annually. Due to the absence of the enactment of Joint Committee legislation to reduce the deficit by at least $1.2 trillion over the 10-year period (described above), the BCA requires these reductions to the statutory limits on both defense and nondefense discretionary spending for each year through FY2021.10

These reductions are often referred to as a sequester, but they are not a sequester per se because they do not make automatic, across-the-board cuts to programs. Instead, they lower the spending limits, allowing Congress the discretion to develop legislation within the reduced limits.

For information on the spending limit amounts, see the section below titled "9. How is discretionary spending currently affected by the BCA?"

Annual Mandatory Spending Sequester

Because legislation from the Joint Committee to reduce the deficit by at least $1.2 trillion over the 10-year period (described above) was not enacted, the BCA requires the annual sequester (automatic, across-the-board reductions) of nonexempt mandatory spending programs.11 This sequester was originally intended to occur each year through FY2021 but has been extended to continue through FY2029.12

Many programs are exempt from sequestration, such as Social Security, Medicaid, the Children's Health Insurance Program (CHIP), Temporary Assistance for Needy Families (TANF), and Supplemental Nutrition Assistance Program (SNAP, formerly food stamps). In addition, special rules govern the sequestration of certain programs, such as Medicare, which is limited to a 2% reduction.13 To see a list of direct spending programs included in the most recent sequester report, see the annual Office of Management and Budget (OMB) report to Congress on the Joint Committee sequester for FY2020.14

For more information on the budgetary impact of the mandatory spending sequester, see the section below titled How is mandatory spending currently affected by the BCA?

3. What is a sequester and when will it occur?

A sequester provides for the enforcement of budgetary limits established in law through the automatic cancellation of previously enacted spending. This cancellation of spending makes largely across-the-board reductions to nonexempt programs, activities, and accounts. A sequester is implemented through a sequestration order issued by the President as required by law.

The purpose of a sequester is to enforce certain statutory budget requirements—either to discourage Congress from enacting legislation violating a specific budgetary goal or to encourage Congress to enact legislation that would fulfill a specific budgetary goal. One of the authors of the law that first employed the sequester recently stated, "It was never the objective ... to trigger the sequester; the objective ... was to have the threat of the sequester force compromise and action."15

As mentioned above, sequestration is currently used as the enforcement mechanism for policies established in the BCA:

4. What statutory changes have been made to the BCA?

Legislation has been enacted making changes to the spending limits or enforcement procedures included in the BCA for each year from FY2013 through FY2021. Some of the most significant of these changes are the following:

5. Is Congress bound by the BCA?

Congress may modify or repeal any aspect of the BCA procedures at its discretion, but such changes require the enactment of legislation. Since enactment of the BCA, subsequent legislation has modified both the discretionary spending limits and the mandatory spending sequester (as described above).

In considering the potential for Congress to reach agreement on future modifications to the BCA, particularly the discretionary spending limits, it may be worth noting the following:

6. Which types of legislation are subject to the discretionary spending limits?

Budget Resolutions

Although the budget resolution may act as a plan for the upcoming budget year, it does not provide budget authority and therefore cannot trigger a sequester for violation of the discretionary spending limits. Nevertheless, budget resolutions are often referred to in terms of complying with, or not complying with, the discretionary spending limits.21

Even if a budget resolution were agreed to that included planned levels of spending in excess of the discretionary spending limits, this would not supersede the discretionary spending limits stipulated by the BCA. While Congress may modify or cancel the discretionary spending limits at its discretion, such changes require the enactment of legislation.

Authorizations of Appropriations

Authorizations of discretionary appropriations, such as the National Defense Authorization Act (NDAA), do not provide budget authority and therefore cannot trigger a sequester for violation of the discretionary spending limits. Although authorizations often include recommendations for funding levels, budget authority is subsequently provided in appropriations legislation. It is, therefore, appropriations legislation that could trigger a sequester. Nevertheless, authorizations (the NDAA in particular) are often discussed in terms of whether or not the authorized level of funding, if appropriated, would comply with the discretionary spending limits.22

Even if an authorization bill were enacted that authorized appropriations at levels in excess of the discretionary spending limits, this authorization would not supersede the statutory discretionary spending limits stipulated by the BCA. While Congress may modify or cancel the discretionary spending limits at its discretion, such changes require the enactment of legislation.

Regular, Supplemental, and Continuing Appropriations

Appropriations legislation that provides budget authority for discretionary spending programs in excess of the discretionary spending limits can trigger a sequester for violation of the discretionary spending limits. This includes regular appropriations legislation, supplemental appropriations legislation, and continuing resolutions (CRs).23

Any appropriations legislation enacted into law that provides budget authority in excess of the levels stipulated by the BCA would trigger a sequester, canceling previously enacted spending through automatic, largely across-the-board reductions of nonexempt budgetary resources within the category of the breach.

The statutory limits established by the BCA as amended apply to budget authority and not outlays. Budget authority is what federal agencies are legally permitted to obligate, and it is controlled by Congress through appropriation acts in the case of discretionary spending or through other acts in the case of mandatory spending. Budget authority gives federal officials the ability to spend. Outlays are disbursed federal funds. Until the federal government disburses funds to make payments, no outlays occur. Therefore, there is generally a lag between when Congress grants budget authority and when outlays occur.

7. Is some spending "exempt" or "excluded" from the BCA?

Some spending is regarded as "exempt" from the BCA. A distinction should be noted between categories of spending that are "excluded" from the discretionary spending limits and spending programs that are "exempt" from sequestration.

For example, spending designated as emergency requirements or for OCO/GWOT is effectively excluded from the discretionary spending limits up to any amount (meaning that the designation of such spending allows for an upward adjustment of the discretionary limits to accommodate that spending).25 The BCA does not define what constitutes this type of funding, nor does it limit the level or amount of spending that may be designated as being for such purposes.

Similarly, "disaster funding" and spending for "continuing disability reviews and redeterminations" and "healthcare fraud and abuse control" are effectively exempt up to a certain amount (again meaning that such spending allows for an upward adjustment of the discretionary limits to accommodate that spending), as are other programs.

It may also be helpful to review OMB sequester reports detailing programs that have been subject to sequester. To see a list of both discretionary and direct spending programs subject to the FY2013 sequester, see the OMB report to Congress on the Joint Committee sequestration for FY2013.26 To see a list of direct spending programs included in the most recent sequester report, see the annual OMB report to Congress on the Joint Committee sequester for FY2020.27

8. How does the "parity principle" apply to the BCA?

The "parity principle" refers to the equality between changes made to defense and nondefense budget authority through some deficit reduction measures established by the BCA. While there has never been a statutory requirement to uphold the parity principle, budget parity has followed from deficit reduction measures imposed by the BCA and some of the subsequent amendments to its deficit reduction measures. The specific type of parity in each law evolved over time.

The BCA and ATRA reflected parity in the budgetary impact of changes to defense and nondefense budget authority across both discretionary and mandatory spending categories. Subsequent BCA amendments in BBA 2013 and BBA 2015 reflected parity between defense and nondefense budget authority for discretionary spending only, as those laws also extended automatic mandatory deficit reduction measures that had larger budget reductions for nondefense activities than for defense programs.

BBA 2018 reflected yet another type of parity, as the amended discretionary cap levels in FY2018 and FY2019 were increased by an equivalent amount relative to the initial BCA levels as established in August 2011. As compared with the caps after the automatic reductions took effect, BBA 2018 included larger increases to the defense caps than to the nondefense caps. As with BBA 2013 and BBA 2015, BBA 2018 also included an extension to the automatic mandatory spending reductions with a larger set of reductions for nondefense programs than for defense programs. BBA 2019 did not include increases that reflected any definition of the parity principle: as with BBA 2018 it imposed larger increases to defense programs than nondefense programs for FY2020 and FY2021, but the difference between the nondefense and defense caps in each year was smaller than the gap initially established by the BCA.

The BCA provides for upward adjustments to the discretionary caps, sometimes called spending "outside the caps," for budget authority devoted to OCO, emergency requirements, and other purposes.28 Budget authority for BCA upward adjustments has not reflected parity between defense and nondefense activities in any effective year of the BCA to date, as upward adjustments have allowed for more defense spending than nondefense spending in each year from FY2012 through FY2017 and FY2019, while upward adjustments were larger for defense spending than nondefense spending in FY2018.

9. How is discretionary spending currently affected by the BCA?

The BCA includes annual statutory caps that limit how much discretionary budget authority can be provided for defense and nondefense activities. These limits are in effect through FY2021 and are enforced by sequestration, meaning that a breach of the discretionary spending limit for either category would trigger a sequester of resources within that category only to make up for the amount of the breach.

A second component of the BCA makes automatic decreases to these caps annually. In the absence of the enactment of a Joint Committee bill to reduce the deficit by at least $1.2 trillion, the BCA required downward adjustments (or reductions) to the statutory limit on both defense and nondefense spending each year through FY2021. While these reductions are often referred to as sequesters, they are not technically sequesters because they do not make automatic, across-the-board cuts to programs. The reductions instead lower the spending limits, allowing Congress the discretion to develop legislation within the reduced limits. These reductions are to be calculated annually by OMB and are included in the OMB Sequestration Preview Report to the President and Congress, which is issued with the President's annual budget submission.

The BCA stipulates that certain discretionary funding, such as appropriations designated as OCO or for emergency requirements, allows for an upward adjustment of the discretionary limits. OCO funding is therefore sometimes described as being "exempt" from the discretionary spending limits.29 The BCA does not define what constitutes this type of funding, nor does it limit the level of spending that may be designated as being for such purposes.

Budgetary Impact

The BCA as enacted was estimated to reduce budget deficits by a cumulative amount of roughly $2 trillion over the FY2012-FY2021 period. Subsequent modifications enacted through ATRA, BBA 2013, and BBA 2015 lessened the level of deficit reduction projected to be achieved by the BCA in selected years. ATRA postponed FY2013 spending reductions and made them smaller. In contrast, BBA 2013, BBA 2015, BBA 2018, and BBA 2019 limited the deficit-reducing impact through increases in the discretionary budget authority caps in FY2014-FY2021.

Table 1 shows the evolution of discretionary spending limits established by the BCA from August 2011 through August 2019. The discretionary caps in FY2020 are currently scheduled to be $667 billion for defense activities and $622 billion for nondefense activities, higher than their totals of $647 billion and $597 billion, respectively, in FY2019. The combined discretionary limit in FY2020 ($1,288 billion) is $45 billion higher than its FY2019 value.

Table 1. Discretionary Budget Authority Limits Under the BCA as Amended, August 2011-Present

(in billions of nominal dollars)

 

 

 

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

BCA

Aug. 2011

Defense

555

546

556

566

577

590

603

616

630

644

 

 

Non-defense

507

501

510

520

530

541

553

566

578

590

Auto. Enforce-ment

Jan. 2012

Defense

555

492

501

511

522

535

548

561

575

589

 

 

Non-defense

507

458

472

483

493

505

517

531

545

557

ATRA

Jan. 2013

Defense

555

518

497

511

522

535

548

561

575

589

 

 

Non-defense

507

484

469

483

494

505

518

532

545

558

BBA 2013

Dec. 2013

Defense

555

518

520

521

523

536

549

562

576

590

 

 

Non-defense

507

484

492

492

493

504

516

530

543

556

BBA 2015

Nov. 2015

Defense

555

518

520

521

548

551

549

562

576

590

 

 

Non-defense

507

484

492

492

518

519

516

530

543

555

BBA 2018

Feb. 2018

Defense

555

518

520

521

548

551

629

647

576

590

 

 

Non-defense

507

484

492

492

518

519

579

597

543

555

BBA 2019 (Current)

Aug. 2019

Defense

555

518

520

521

548

551

629

647

667

672

 

 

Non-defense

507

484

492

492

518

519

579

597

622

627

Sources: CBO, letter to the Honorable John A. Boehner and Honorable Harry Reid estimating the impact on the deficit of the Budget Control Act of 2011, August 2011; CBO, Final Sequestration Report for Fiscal Year 2012, January 2012; CBO, Final Sequestration Report for Fiscal Year 2013, March 2013; CBO, Final Sequestration Report for Fiscal Year 2014, January 2014; CBO, Final Sequestration Report for Fiscal Year 2016, December 2015; CBO, Sequestration Update Report: August 2017, August 2017; CBO, Updated Budget and Economic Projections: 2019 to 2029, May 2019: CRS Insight IN11148, The Bipartisan Budget Act of 2019: Changes to the BCA and Debt Limit.

Notes: Spending limits apply to fiscal years. Bold figures indicate statutory changes. The BCA as amended provided for "Security" and "Nonsecurity" categories in FY2012 and FY2013: italicized figures denote CRS estimates of budget authority for defense and nondefense categories in those years. Small changes in FY2016-FY2021 budget authority shown in ATRA, BBA 2013, and BBA 2015 rows are caused by adjustments in the annual proportional allocations of automatic enforcement measures as calculated by OMB: for more information on these adjustments, see CBO, Estimated Impact of Automatic Budget Enforcement Procedures Specified in the Budget Control Act, September 2011.

10. How is mandatory spending currently affected by the BCA?

The absence of an agreement by the Joint Committee triggered automatic spending reductions (as provided for in the BCA) for all mandatory programs that were not explicitly exempted from FY2013 through FY2021. Notably, Social Security payments were exempted from the automatic reductions, and the effect on Medicare spending was limited to 2% of annual payments made to certain Medicare programs. Extensions of the mandatory spending reductions were included in BBA 2013, BBA 2015, BBA 2018, and BBA 2019 and are currently scheduled to remain in place through FY2029. A recent OMB sequestration report estimated that such measures will reduce mandatory outlays by $20.7 billion in FY2020, with $19.86 billion of that total applied to nondefense programs and $0.84 billion applied to defense programs.30

11. Why do discretionary outlays differ from the spending limits established by the BCA?

The limits on discretionary spending established by the BCA apply to budget authority, which is the amount that federal agencies are legally permitted to obligate. Outlays, meanwhile, are disbursed federal funds: In other words, they represent amounts that are actually spent by the government. There is generally a lag between when Congress grants budget authority and when outlays occur, and that lag can vary depending on the agency and specific purpose of the obligation.31 Furthermore, the budget may classify certain types of spending in a certain way when measuring budget authority and another way when measuring outlays. For example, much of the spending attached to the Highway Trust Fund is classified as mandatory spending when measuring budget authority and as discretionary spending when measuring outlays.32

12. How has federal spending changed since enactment of the BCA?

Budget deficits declined for much of the 1990s due to decreased spending, rising revenues, and an improved economy. The federal budget recorded surpluses from FY1998 through FY2001. Prior to that, the last budget surplus occurred in FY1969. Budget deficits returned starting in FY2002 and slowly increased over the next several years due to reduced revenues and increased spending. Net deficits peaked during the Great Recession from FY2009 to FY2011, as negative and low economic growth coupled with increased spending commitments provided for by the American Recovery and Reinvestment Act (P.L. 111-5) contributed to real deficits averaging 9.0% of gross domestic product (GDP) in those years.

Real deficits have declined since FY2011, due to the modifications made by the BCA, increased revenues, and the winding down of stimulus programs. However, the FY2019 deficit (4.3% of GDP, or $665 billion) remains higher than the average deficit since FY1969 (2.9% of GDP).The CBO baseline projects that real budget deficits will increase in future years.

13. How do modifications to the BCA affect baseline projections?

Modifications to the limits on discretionary spending, established by the BCA, change authorizations levels, which in turn affect outlays. CBO provides estimates of both discretionary spending effects and mandatory spending effects in its legislative cost estimates. Whether proposed legislation affects discretionary or mandatory spending may have ramifications for congressional budgetary enforcement procedures, however.

CBO's baseline projections assume that the discretionary limits imposed by the BCA as amended will proceed as scheduled through FY2021 and that discretionary spending levels will grow with the economy in subsequent years.33 Such methodology uses the discretionary spending levels in FY2021 as the basis for discretionary spending projections for the remainder of the budget window.

Author Contact Information

Grant A. Driessen, Analyst in Public Finance ([email address scrubbed], [phone number scrubbed])
Megan S. Lynch, Specialist on Congress and the Legislative Process ([email address scrubbed], [phone number scrubbed])

Footnotes

1.

A statutory increase had been enacted roughly once per year since its creation in 1917. For more information, see CRS Report RL31967, The Debt Limit: History and Recent Increases, by D. Andrew Austin.

2.

The Great Recession describes the contractionary period (which lasted from December 2007 to June 2009) and subsequent recovery of the U.S. economy.

3.

The House and Senate each voted on such an amendment. The Senate rejected two balanced budget amendments, while the House failed to achieve the necessary two-thirds vote needed for passage.

4.

The statutory limits currently included in the BCA are described in statute as security and nonsecurity. Currently, the security category is defined to include discretionary appropriations classified as budget function 050 (national defense) only, and the nonsecurity category is defined to include all other discretionary appropriations. Originally, however, the BCA caps defined the security category to include discretionary spending for the Departments of Defense, Homeland Security, and Veterans Affairs; the National Nuclear Security Administration; the intelligence community management account; and all accounts in the international affairs budget function (budget function 150) and defined the nonsecurity category to include discretionary spending in all other budget accounts. This change in category definitions occurred automatically under the BCA as part of the automatic spending reduction process that resulted from the lack of enactment of a bill reported by the Joint Committee on Deficit Reduction.

5.

While the committee was tasked with reporting legislation that would reduce the deficit by $1.5 trillion over the period of FY2012-FY2021, the automatic process to reduce spending was designed to be triggered only if legislation reported by the committee reducing the deficit by at least $1.2 trillion was not enacted.

6.

Discretionary spending is controlled through the appropriations process and is generally provided annually. The appropriations committees have jurisdiction over discretionary spending programs, while authorizing committees have jurisdiction over mandatory (or direct) spending programs. For more information see CRS Report R42388, The Congressional Appropriations Process: An Introduction, coordinated by James V. Saturno.

7.

The spending limits were part of the Budget Enforcement Act of 1990 (BEA; P.L. 101-508). For more information, see CRS Report R41901, Statutory Budget Controls in Effect Between 1985 and 2002, by Megan S. Lynch. During the period of FY1991-FY2002, separate caps existed and varied by year. The concept of capping defense and nondefense spending separately was discussed as early as 1984 and is often cited as "the rose garden proposal." Senator Howard Baker, Senate debate, Congressional Record, April 24, 1984, p. 9681.

8.

Ibid., footnote 4.

9.

For more information, see section below titled Are some spending programs "exempt" from the BCA?

10.

The BCA established the Joint Select Committee on Deficit Reduction, directed to develop a proposal that would reduce the deficit by at least $1.5 trillion over FY2012 to FY2021. The BCA also established an automatic process to produce additional savings, beginning in 2013, in the event that a bill reported by the Joint Select Committee on Deficit Reduction reducing the deficit by at least $1.2 trillion was not enacted by January 15, 2012. (Such a bill was not enacted.) This automatic process requires annual downward adjustments of the discretionary spending limits, as well as a sequester of nonexempt mandatory spending programs.

11.

Ibid.

12.

The Bipartisan Budget Act of 2013 (P.L. 113-67, also referred to as the Murray-Ryan agreement) extended the mandatory spending sequester by two years to FY2023. Soon after the enactment of the Bipartisan Budget Act of 2013, a bill was enacted to "ensure that the reduced annual cost-of-living adjustment to the retired pay of members and former members of the armed forces under the age of 62 required by the Bipartisan Budget Act of 2013 will not apply to members or former members who first became members prior to January 1, 2014, and for other purposes (P.L. 113-82)." This legislation extended the mandatory spending sequester by one year to FY2024. BBA 2015 (P.L. 114-74) extended the mandatory spending sequester by one year to FY2025. BBA 2018 (P.L. 115-123) further extended the mandatory spending sequester by an additional two years through FY2027, and BBA 2019 (P.L. 116-37) extended the mandatory sequester by another two years through FY2029.

13.

These exemptions and special rules are found in Sections 255 and 256 of the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA, Title II of P.L. 99-177), commonly known as the Gramm-Rudman-Hollings Act. For more information, see CRS Report R42050, Budget "Sequestration" and Selected Program Exemptions and Special Rules, coordinated by Karen Spar.

14.

OMB, OMB Report to the Congress on the Joint Committee Reductions for Fiscal Year 2020, March 18, 2019, https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/sequestration_reports/2018_jc_sequestration_report_may2017_potus.pdf.

15.

Oral and written testimony of the Honorable Phil Gramm, former Member of the House of Representatives from 1979 to 1985 and U.S. Senator from 1985 to 2002, before the Senate Finance Committee at the hearing on Budget Enforcement Mechanisms, May 4, 2011, https://www.finance.senate.gov/imo/media/doc/050411pgtest.pdf. The law referred to is BBEDCA (P.L. 99-177). For more information on sequestration, see CRS Report R42972, Sequestration as a Budget Enforcement Process: Frequently Asked Questions, by Megan S. Lynch. Sequestration was first used as an enforcement mechanism in BBEDCA (referenced above). For more information on the use of sequestration in BBEDCA and the BEA, see CRS Report R41901, Statutory Budget Controls in Effect Between 1985 and 2002, by Megan S. Lynch.

16.

For more information, see CRS Report R43535, Provisions in the Bipartisan Budget Act of 2013 as an Alternative to a Traditional Budget Resolution, by Megan S. Lynch.

17.

For more information, see out of print CRS Insight IN10389, Bipartisan Budget Act of 2015: Adjustments to the Budget Control Act of 2011, by Grant A. Driessen, available to congressional staff upon request.

18.

For more information on the Congressional Budget Office (CBO) estimates related to legislative changes to the discretionary limits, see CBO, "Frequently Asked Questions About CBO Cost Estimate," https://www.cbo.gov/about/products/ce-faq.

19.

Democratic Policy and Communications Center, "In Wake of Partisan Maneuvers to Break Budget Agreement, Senate Dem Leaders Urge GOP to Publicly Agree to Honor Core Tenets of Last Year's Bipartisan Budget Agreement to Allow Appropriations Process to Move Forward," press release, July 7, 2016, https://www.dpcc.senate.gov/?p=issue&id=594; and U.S. Senate Committee on Appropriations, "Mikulski Floor Statement on Reed-Mikulski Amendment," press release, June 8, 2016, http://www.appropriations.senate.gov/news/minority/mikulski-floor-statement-on-reed-mikulski-amendment.

20.

For more information on the parity principle, see the section below titled How does the "parity principle" apply to the BCA?

21.

While it cannot trigger a sequester, a budget resolution may be subject to a point of order in the Senate created to enforce the discretionary limits. For more information on the budget resolution and discretionary spending limits, including possible points of order against a budget resolution that provides for spending in excess of the discretionary spending limits, see CRS In Focus IF10647, The Budget Resolution and the Budget Control Act's Discretionary Spending Limits, by Megan S. Lynch.

22.

While it cannot trigger a sequester, an authorization bill may be subject to a point of order created to enforce the discretionary limits. If an authorization bill were to authorize appropriations at levels that would breach the BCA limits, such as an amount for the defense function (050) that is higher than the spending limit for FY2018, its consideration might be subject to a point of order in the Senate under Section 312(b), which prohibits consideration in the Senate of any bill, resolution, amendment, motion, or conference report that would exceed the discretionary spending limits. (No corresponding point of order exists in the House.) It may be worth noting that the NDAA includes only the authorizations of appropriations within the jurisdiction of the House and Senate Armed Services Committees, which does not reflect all of the authorizations of appropriations within the national defense budget function (050). If such a point of order were raised, further consideration of the budget resolution might not be in order unless the point of order was waived by a vote of three-fifths of all Senators.

23.

Consideration of legislation that would provide spending in excess of the spending limits would be subject to a point or order. For example, if an appropriations bill were to provide appropriations at levels that would breach the discretionary spending limits, such as an amount for the defense function (050) that is higher than the spending limit for FY2018, its consideration would be subject to a 312(b) point of order in the Senate as well as a 314(f) point of order in either the House or the Senate. If either of those points of order were raised and sustained, further consideration of the appropriations measure would not be in order, unless the point of order was waived by a vote of three-fifths of all Senators in the Senate or in the House by a simple majority of those Members voting. For more information on those points of order, see CRS Report 97-865, Points of Order in the Congressional Budget Process, by James V. Saturno.

24.

For more information, see CRS Report R45778, Exceptions to the Budget Control Act's Discretionary Spending Limits, by Megan S. Lynch.

25.

These adjustments are specified in Section 251(b)(2) [2 U.S.C. §901(b)(2)]. Spending designated as "emergency" or for OCO/GWOT must be designated on an account-by-account basis and must be subsequently designated so by the President.

26.

This was the last time that discretionary programs were subject to a sequester. OMB, OMB Report to the Congress on the Joint Committee Sequestration for Fiscal Year 2013, March 1, 2013, https://obamawhitehouse.archives.gov/sites/default/files/omb/assets/legislative_reports/fy13ombjcsequestrationreport.pdf.

27.

OMB, OMB Report to the Congress on the Joint Committee Sequestration for Fiscal Year 2020, March 18, 2019, https://www.whitehouse.gov/omb/legislative/sequestration-reports-orders/.

28.

For more information, see the section above titled Are any spending programs "exempt" or "excluded" from the BCA?

29.

Ibid.

30.

OMB, "OMB Report to the Congress on the Joint Committee Reduction for Fiscal Year 2020," March 18, 2019, https://www.whitehouse.gov/2020_jc_sequestration_report_3-18-19.pdf.

31.

See section titled Which types of legislation are subject to the discretionary spending limits?

32.

For more information on the budgetary treatment of the Highway Trust Fund, see CBO, The Highway Trust Fund and the Treatment of Surface Transportation Programs in the Federal Budget, June 2014, https://www.cbo.gov/sites/default/files/113th-congress-2013-2014/reports/45416-TransportationScoring.pdf.

33.

This methodology is consistent with Section 257 of the Deficit Control Act. For more information, see CBO, The Budget and Economic Outlook: 2017 to 2027, January 2017, p. 26.