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Updated February 10, 2021
Foreign Affairs Overseas Contingency Operations (OCO)
Funding: Background and Current Status
Congressional interest in Overseas Contingency Operations
year continuing appropriations (P.L. 113-6, Div. F, Title
(OCO) funding levels has continued as Members debate
VII, §§1707-1708), Congress specified only Jordan as an
annual foreign affairs and defense budgets. First used by the
additional OCO-recipient country.
foreign affairs agencies in FY2012, a key feature of OCO
funds was their effective exemption, like emergency funds,
Figure 1. Foreign Affairs Overseas Contingency
from the discretionary spending limits established by the
Operations Funding, FY2012-FY2021
Budget Control Act of 2011 (BCA, P.L. 112-25). Some
(in bil ions of U.S. dol ars)
Members suggested that OCO’s exemption provided
agencies with additional budget cushioning and flexibility,
allowing defense and nondefense foreign affairs funding to
exceed the spending caps. Others criticized the OCO
designation, labeling it as a “slush fund” that provided
funds for programs unrelated to contingency operations.
The BCA’s spending caps ended in FY2021, and it is
unclear whether Congress will continue to use the OCO
designation as it considers FY2022 appropriations. The
foreign affairs agencies last requested OCO funds in
FY2018. However, Congress has appropriated $8.0 billion
designated as OCO every year since FY2019. It remains to
be seen whether or not the Biden Administration will
Source: Department of State Congressional Budget Justifications,
include OCO in its budget requests.
FY2014-FY2020, P.L. 115-141, P.L. 116-6, P.L. 116-94, and P.L. 116-
260. The totals enacted include net rescissions.
While ongoing debate in Congress over OCO may focus on
defense spending (which receives the largest share of OCO
For FY2014 (P.L. 113-76, Div. K, Title VIII), Congress
funds), foreign affairs OCO funding may continue to play a
provided four accounts with no-year (available until
role in consideration of the international affairs budget.
expended) OCO funds, but made most foreign affairs OCO
funds available for two years—or until September 30, 2015.
Background on Foreign Affairs OCO
Congress also expanded the terms of transfer authority,
The foreign affairs agencies began requesting OCO funding
providing greater flexibility across certain accounts. It also
in FY2012, distinguishing between enduring (ongoing
authorized transfers from those accounts to International
costs) versus extraordinary, temporary costs of the
Disaster Assistance (IDA) and Migration and Refugee
Department of State and the U.S. Agency for International
Assistance (MRA) accounts, subject to certain dollar
Development (USAID) in the frontline states of Iraq,
amounts or percentages, and regular notification
Afghanistan, and Pakistan. OCO-designated funds largely
procedures. FY2014 OCO-funded activities were
replaced annual emergency supplemental appropriations to
implemented in Iraq, Afghanistan, Pakistan, Jordan,
support the Global War on Terrorism (GWOT) in the
Lebanon, the Central African Republic, and Somalia.
frontline states that became the norm during the George W.
Bush Administration. Congress, already using the OCO
For FY2015 (P.L. 113-235, Div. J, Title VIII), although
designation within the Department of Defense (DOD)
Congress did not provide specific OCO funds for
budget, adopted this approach for foreign affairs, although
countering the Islamic State (IS), as was requested by the
it never permanently defined its uses in statute. Since
Obama Administration, it did provide an increase in OCO
FY2012, Congress has appropriated OCO-designated
funds in many accounts with language that allowed it to be
foreign affairs funds at higher levels and for broader
used for counterterrorism. The Obama Administration
purposes than were requested each year (see Figure 1).
requested an expanded use of OCO funds for Syria and
peacekeeping in FY2016 (P.L. 114-113, Div. K, Title VIII)
For the first foreign affairs OCO appropriation in FY2012
and FY2017 (P.L. 115-31, Div. J, Title VIII). Congress also
(P.L. 112-74, Div. I, Title VIII), Congress provided funds
provided OCO funding in both years to respond to the
for a wide range of activities beyond the three frontline
Ebola and Zika viruses, support counterterrorism, and
states, including in Yemen, Somalia, Kenya, and the
counter Russian aggression.
Philippines. In addition to country-specific uses, Congress
also used the OCO designation for funds appropriated for
The FY2018 (P.L. 115-141, Div. K, Title VIII) and FY2019
the Global Security Contingency Fund. In the FY2013 full-
(P.L. 116-6, Div. F, Title VIII) foreign affairs OCO-
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Foreign Affairs Overseas Contingency Operations (OCO) Funding: Background and Current Status
designated appropriations included funds to address global
funds as a share of the international affairs budget have
refugee responses and to support assessed peacekeeping
declined in recent years, from a peak of 36% in FY2017 to
contributions for operations in Somalia, among other
13% in FY2021. Further, the use of emergency funding in
activities.
FY2020 and FY2021 to address the Coronavirus Disease
2019 (COVID-19) pandemic and specific assistance for
In FY2020 (P.L. 116-94, Div. G) and FY2021 (P.L. 116-
Sudan may indicate a return to the practice of using non-
260, Div. K), Congress did not designate OCO funding
OCO emergency funding to support extraordinary needs
within a separate title of the bill; rather, OCO levels were
(see Figure 2).
embedded in select appropriations accounts throughout the
legislation. OCO-designated funds in both years were
Figure 2. OCO Funding as a Share of Total
distributed similarly, with Diplomatic and Consular
International Affairs Budget
Programs and humanitarian accounts receiving the majority
(in bil ions of current U.S. dol ars)
share. Table 1 details OCO funding by account for
FY2021.
Table 1. FY2021 Foreign Affairs OCO Funding
(in millions of U.S. dol ars)
Total
8,000.0
Appropriated Funds
Worldwide Security Protection (within Diplomatic
2,226.1
Programs)
State Department Office of Inspector General
54.9
Worldwide Security Upgrades (within Embassy
824.3
Security, Construction and Maintenance)
Contributions to International Organizations (CIO)
96.2
Contributions for International Peacekeeping
706.0
Source: Department of State Congressional Budget Justifications,
International Disaster Assistance (IDA)
1,914.0
FY2014-FY2020, P.L. 115-141, P.L. 116-6, P.L. 116-94, P.L. 116-123,
P.L. 116-136, and P.L. 116-260. The totals enacted include net
Migration and Refugee Assistance (MRA)
1,701.4
rescissions.
Peacekeeping Operations (PKO)
325.2
Notes: “Emergency” designates funding that was appropriated as
Foreign Military Financing (FMF)
576.9
emergency funds (meaning they also fal outside of the BCA spending
Rescissions
caps) but not designated as OCO.
Diplomatic Programs
(360.1)
As BCA discretionary spending caps have expired, the use
Peacekeeping Operations (PKO)
(40.0)
of OCO as a foreign affairs funding mechanism may
Foreign Military Financing
(25.0)
change. The Biden Administration has not yet indicated
Source: P.L. 116-260.
whether or not it intends to include OCO in its budget
Note: Numbers within parentheses are negative.
requests. Congress may continue the downward trend in use
of the OCO designation, using OCO funds only for
The Future of Foreign Affairs OCO
extraordinary contingency programs, as in the past.
OCO has consistently been described by Congress as
Alternatively, Congress may phase out the use of foreign
supporting extraordinary budget needs, even as the use of
affairs OCO entirely, instead integrating OCO funding for
the designation has expanded over the years to apply to an
regular operations into the base budget and relying on
increasing range of activities, many of which are not
emergency supplemental appropriations to address out-of-
directly related to active conflicts. According to the joint
cycle, unanticipated needs, as was the norm prior to
explanatory statement accompanying final FY2020
adoption of the OCO designation. The use of the OCO
appropriations, “[OCO] funds are intended to address the
designation in the foreign affairs context may be part of a
extraordinary costs of operations and assistance in countries
broader policy debate that includes the use of OCO-
in conflict and areas of instability and violence, particularly
designated funding in the defense budget as well.
for security, stabilization, and peacekeeping programs;
More Information
humanitarian activities; and counterterrorism and
counterinsurgency efforts.” During the Obama
For more information on OCO and the foreign affairs
Administration, the OCO designation arguably devolved
budget, see CRS Report R44519, Overseas Contingency
into a mechanism that enabled Congress to increase
Operations Funding: Background and Status, and CRS
spending on regular operations while technically complying
Report R46367, Department of State, Foreign Operations,
with BCA budget caps. The Trump Administration
and Related Programs: FY2021 Budget and
repeatedly requested significant budget cuts for
Appropriations.
international affairs activities and did not seek OCO funds
for the majority of its tenure; however, Congress continued
Emily M. Morgenstern, Analyst in Foreign Assistance and
to appropriate OCO funds and did not enact large cuts to
Foreign Policy
the international affairs budget overall. OCO-designated
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Foreign Affairs Overseas Contingency Operations (OCO) Funding: Background and Current Status
IF10143
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