Functional Categories of the Federal Budget

Functional Categories of the Federal Budget

Order Code 98-280 GOV
Updated March 5, 2001
CRS Report for Congress
Received through the CRS Web
Functional Categories of the Federal Budget
Bill Heniff Jr.
Consultant in American National Government
Government and Finance Division
The President's budget and the congressional budget resolution classify federal
budgetary activities into functional and subfunctional categories that represent the major
purposes of the federal government. Each budgetary activity of the federal government,
including budget authority, outlays, tax expenditures, and credit authority, is classified into
a subfunction based on the primary purpose it serves without regard to the agency or other
unit responsible for it. The functional categories provide a broad statement of budget
priorities and facilitate the analysis of trends in related programs regardless of the type of
financial transaction or agency organization.
The annual budget resolution sets forth spending and credit amounts for each
functional category. The amounts are used for informational purposes in the congressional
budget process and are not enforced by points of order. Instead, amounts in each
functional category are distributed to the various congressional committees with
jurisdiction over the spending and credit activities. The committee allocations made under
Section 302 of the Congressional Budget Act (P.L. 93-344) are enforceable through points
of order on the floor of each house. In suballocating their allocations, committees
effectively may alter the functional distributions made in the budget resolution.
Historically, the use of functional classifications by the federal government can be
traced to the first appropriations act. The current function and subfunction classifications
have evolved over time. Under Section 1104(c) of Title 31 U.S.C., the President may
change the form of his budget presentation. Any change in the functional categories,
however, must be made in consultation with the House and Senate Appropriations
Committees and Budget Committees. The General Accounting Office reviews budgetary
classification schemes, from time to time, and makes recommendations for change.1
A list of the 20 functional categories currently included in the federal budget, as well
as the subfunctions, is presented in Table 1. Generally, the first 17 functional categories
reflect major policy areas, while the remaining three represent non-programmatic elements
of the budget that must be included to complete the presentation. Every budgetary
account is assigned an identification code, and the last three digits of these codes designate
the subfunction into which it is classified.
1 For a recent GAO report on this topic, see: Budget Function Classifications: Origins, Trends,
and Implications for Current Uses, GAO/AIMD-98-67, February 1998.
Congressional Research Service ˜ The Library of Congress

CRS-2
1. List of Functional and Subfunctional Categories
Functional categories
Subfunctional categories
National defense (050)
Department of Defense-Military (051); Atomic energy defense activities
(053); Defense-related activities (054)
International affairs (150)
International development and humanitarian assistance (151); International
security assistance (152); Conduct of foreign affairs (153); Foreign
information and exchange activities (154); International financial programs
(155)
General science, space, and
General science and basic research (251); Space flight, research, and
technology (250)
supporting activities (252)
Energy (270)
Energy supply (271); Energy conservation (272); Emergency energy
preparedness (274); Energy information, policy, and regulation (276)
Natural resources and
Water resources (301); Conservation and land management (302);
environment (300)
Recreational resources (303); Pollution control and abatement (304); Other
natural resources (306)
Agriculture (350)
Farm income stabilization (351); Agricultural research and services (352)
Commerce and housing credit
Mortgage credit (371); Postal Service (372); Deposit insurance (373); Other
(370)
advancement of commerce (376)
Transportation (400)
Ground transportation (401); Air transportation (402); Water transportation
(403); Other transportation (407)
Community and regional
Community development (451); Area and regional development (452);
development (450)
Disaster relief and insurance (453)
Education, training,
Elementary, secondary, and vocational education (501); Higher education
employment, and social
(502); Research and general education aids (503); Training and employment
services (500)
(504); Other labor services (505); Social services (506)
Health (550)
Health care services (551); Health research and training (552); Consumer
and occupational health and safety (554)
Medicare (570)
Medicare (571)
Income security (600)
General retirement and disability insurance (excluding social security) (601);
Federal employee retirement and disability (602); Unemployment
compensation (603); Housing assistance (604); Food and nutrition assistance
(605); Other income security (609)
Social security (650)
Social security (651)
Veterans benefits and services
Income security for veterans (701); Veterans education, training and
(700)
rehabilitation (702); Hospital and medical care for veterans (703); Veterans
housing (704); Other veterans benefits and services (705)
Administration of justice
Federal law enforcement activities (751); Federal litigative and judicial
(750)
activities (752); Federal correctional activities (753); Criminal justice
assistance (754)
General government (800)
Legislative functions (801); Executive direction and management (802);
Central fiscal operations (803); General property and records management
(804); Central personnel management (805); General purpose fiscal
assistance (806); Other general government (808); Deductions for offsetting
receipts (809)
Net interest (900)
Interest on the public debt (901); Interest received by on-budget trust funds
(902); Interest received by off-budget trust funds (903); Other interest (908)
Allowances (920)
Varies by year
Undistributed offsetting
Employer share, employee retirement (on-budget) (951); Employer share,
receipts (950)
employee retirement (off-budget) (952); Rents and royalties on the Outer
Continental Shelf (953); Sale of major assets (954); Other undistributed
offsetting receipts (959)