Budget Process Reforms Included in Debt Limit Legislation

February 9, 2023 R47415

Budget Process Reforms Included in Debt Limit February 9, 2023
Legislation
Megan S. Lynch
The amount of money that Treasury may borrow is restricted by a statutory limit on the debt,
Specialist on Congress and
which is currently set to reach its limit of $31.385 trillion sometime in 2023. In the past 40 years,
the Legislative Process
48 measures have been enacted addressing the statutory debt limit. During this period, debt limit

legislation has been enacted as stand-alone legislation (often referred to as a “clean” debt limit
bill) about 40% of the time, while debt limit legislation has been enacted as part of a larger

legislative package about 60% of the time. When debt limit legislation has been part of a larger
package, that legislation has included a broad array of policies (including reconciliation and appropriations legislation), some
of which have been projected to increase deficits and some of which have been projected to decrease them.
Legislative packages that included debt limit changes have also sometimes included significant reforms to the budget
process. Most major statutory budget process reforms in the past 40 years have been made as part of legislation addressing
the debt limit. These reforms sometimes followed periods in which deficits as a percentage of GDP had spiked.
This report summarizes significant budget process reforms included in legislation addressing the debt limit and provides
context on deficit levels at the time. Among other things, these reforms include statutory limits on deficits, statutory limits on
discretionary spending, statutory requirements for PAYGO, a bicameral congressional committee to address deficit reduction,
and a bicameral congressional committee to reform the budget and appropriations process.

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Introduction
When total federal spending exceeds total federal revenue, it produces a budget deficit. When
faced with a deficit, the Department of the Treasury typically issues debt in order to obtain the
funds necessary to finance current federal obligations. The amount of money that Treasury may
borrow, however, is restricted by a statutory limit on the debt. Federal debt is projected to reach
the statutory debt limit, currently set at $31.385 trillion, sometime in 2023.
Congress and the President have typically responded to such a situation by enacting legislation
that either (1) increases the debt limit or (2) suspends the debt limit for a specified period of time.
Since 1983, 48 measures addressing the debt limit have been enacted.1
During this period, debt limit legislation has been enacted as stand-alone legislation (often
referred to as a “clean” debt limit bill) about 40% of the time, while debt limit legislation has
been enacted as part of a larger legislative package about 60% of the time.2 When debt limit
legislation has been part of a larger package, Congress has included a broad array of policies
(including reconciliation and appropriations legislation), some of which were projected to
increase the deficit and some of which were projected to decrease it.
Legislative packages that included debt limit changes have also sometimes included significant
reforms to the budget process, such as budget control legislation. Most of the statutory budget
process reforms in the past 40 years have been part of legislation that also addressed the debt
limit. These reforms sometimes followed a period in which outlays and deficits as a percentage of
gross domestic product (GDP) had increased. It has been argued that including such budget
control provisions with debt limit legislation may make such votes more palatable for some
Members.3
This report summarizes major budget process reforms included in legislation addressing the debt
limit and provides context on outlay, deficit, and debt levels at the time.
For more information on debt limit votes, see CRS Report R41814, Votes on Measures to Adjust
the Statutory Debt Limit, 1978 to Present, by Justin Murray. For more information on the debt
limit generally, see CRS Report R43389, The Debt Limit Since 2011, by D. Andrew Austin; and
CRS In Focus IF10292, The Debt Limit, by Grant A. Driessen.
Budget Process Reforms Included in Debt Limit
Legislation
The Constitution grants Congress the power of the purse.4 In carrying out such duties, Congress
has developed budget-related statutes, rules, and customs, as well as committees to carry out this
responsibility. This collection of budgetary legislation, rules, and customs is often referred to as

1 For information see the Table A-1.
2 For more information, see CRS Report R41814, Votes on Measures to Adjust the Statutory Debt Limit, 1978 to
Present, by Justin Murray.
3 Sarah Binder, “Congress Is Struggling to Raise the Nation’s Debt Cap. Here’s What You Need to Know,”
Washington Post, October 5, 2021; Caitlin Emma, “Democrats Hurtle Toward Debt Deadline Without a Clear Plan,”
Politico, June 24, 2021.
4 U.S. Const. art I, §9, cl. 7: “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made
by Law.”
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the congressional budget process. Congress can alter or reform its internal budget process through
the adoption of simple or concurrent resolutions (which do not go to the President for signature).
Congress may also alter its process thought the enactment of law in the form of either
freestanding legislation or as a provision in another measure, such as an appropriations bill or a
measure to increase the debt limit.5
When there is concern with deficit or debt levels, Congress has sometimes implemented budget
process reforms and/or budget enforcement mechanisms to mandate specific budgetary policies
or fiscal outcomes. While these might be adopted as part of internal chamber rules, congressional
budgetary rules are generally enforced through points of order, which can be waived by a vote of
the chamber.6 Congress has therefore sometimes created statutory budget enforcement
mechanisms that are enacted into law and are often enforced through statutory means, such as a
sequester.7 Most statutory budget enforcement mechanisms enacted in the past 40 years have been
included in legislation addressing the debt limit.
Below is a summary of major budget process reforms included in the same legislation as debt
limit provisions in the past 40 years. The summary includes only those instances in which both
the debt limit change and the budget process reform were included in the same legislative
vehicles. Among other things, these reforms include the establishment of: statutory deficit limits,
statutory limits on discretionary spending, statutory requirements for pay-as-you-go (PAYGO),
and two bicameral congressional committees to address budget reforms as well as budget process
reforms.
Selected budgetary context surrounding enactment of such reforms is provided below. See Figure
1 and Figure 2 for information on historical outlay and deficit levels, including information
marking enactment of specific budget process reforms. See the Appendix for information on the
amount of debt subject to the statutory limit over time (Figure A-1) and the statutory changes
made to the debt limit during the period discussed in this report (Table A-1).

5 For more information, see CRS Report R46240, Introduction to the Federal Budget Process, by James V. Saturno.
6 A Member may raise a point of order against the consideration of legislation that violates the rules of the chamber. If
such a point of order is raised against legislation for violating budgetary restrictions, the presiding officer makes a
ruling on the point of order based on estimates provided by the relevant budget committee. The process for waiving
points of order varies by chamber. Generally, such points of order can be waived in the House by a simple majority of
Members and in the Senate by three-fifths of all Senators.
7 A sequester provides for the automatic cancellation of previously enacted spending, making largely across-the-board
reductions to non-exempt programs, activities, and accounts. A sequester is implemented through a sequestration order
issued by the President as required by law.
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Figure 1. Budget Process Reforms and Deficit/Surplus as a Percentage of GDP

Source: U.S. Government Publishing Office, Budget of the United States Government, FY2016-FY2023, Historical
Tables; Table 1.2—Summary of Receipts, Outlays, and Surpluses or Deficits (-) as Percentages of GDP: 1930-
2027, March 28, 2022, https://www.whitehouse.gov/omb/budget/historical-tables/.
Note: FY2022 and FY2023 are estimates.
Figure 2. Budget Process Reforms and Outlays as a Percentage of GDP

Source: U.S. Government Publishing Office, Budget of the United States Government, FY2016-FY2023, Historical
Tables; Table 1.2—Summary of Receipts, Outlays, and Surpluses or Deficits (-) as Percentages of GDP: 1930-
2027, March 28, 2022, https://www.whitehouse.gov/omb/budget/historical-tables/.
Note: FY2022 and FY2023 are estimates.
Balanced Budget and Emergency Deficit Control Act (1985)
President Reagan signed into law the Balanced Budget and Emergency Deficit Control Act
(BBEDCA; P.L. 99-177), also known as Gramm-Rudman-Hollings (named after its Senate
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sponsors) on December 12, 1985, as part of legislation increasing the debt limit to $2.079
trillion.8
To address rising deficits, BBEDCA established a requirement for the gradual reduction and
elimination of budget deficits over a six-year period (FY1986-FY1991) by specifying annual
deficit limits and by creating a means of developing and enforcing a budget within these
established limits. The act did not specify which policy changes should be made to achieve deficit
reduction, leaving Congress and the President to negotiate over possible revenue increases and
spending decreases each year in order to achieve the specified budgetary outcome.
To enforce the specified deficit limits, the act set forth a specific process for the cancellation of
spending by executive order, known as a sequester order, if the deficit limits were breached. In
the event of sequestration, the funding reduction necessary to achieve the specified target was to
be equally divided between defense and nondefense spending. Nonexempt programs within each
category were to be reduced by a uniform percentage necessary to achieve the total overall
reduction.9
By exempting specific programs from sequestration, the act caused nonexempt programs to bear a
greater reduction if sequestration were implemented. Further, the sequestration design did not
distinguish between programs that had already been reduced through legislative action and those
that had not. This created a situation in which funding for a program that was not exempt from
sequestration may have been reduced (relative to the baseline) through the legislative process, but
if spending on other programs grew or were not reduced sufficiently to achieve the deficit target,
the program that had already been reduced though legislation would still be subject to reduction
through the sequestration process. It was also argued that exempting certain programs from
sequestration meant that advocates of those programs had less of an incentive to negotiate
spending decreases for those programs.
BBEDCA made other procedural changes to the congressional budget process. It amended the
Congressional Budget and Impoundment Control Act of 1974 (P.L. 93-344) by eliminating the
requirement for a second budget resolution, codifying what had become common practice.10 It
amended the budget process timetable to account for this change and made other changes as well.

8 For more information on BBEDCA, see CRS Report R41901, Statutory Budget Controls in Effect Between 1985 and
2002, by Megan S. Lynch.
9 The deficit reduction procedures under this act allowed for suspension in wartime and during a recession. Programs
exempt from sequestration included Social Security; Medicaid; veterans’ compensation; veterans’ pensions; Aid to
Families with Dependent Children; Supplemental Security Income; Women, Infants, and Children; food stamps; the
postal service fund; the earned income tax credit; and various other programs. Also, under the act, certain programs
could be cut by only a certain percentage (1% in 1986 and 2% in subsequent years), such as Medicare, veterans’
medical care, community health centers, migrant health centers, and Indian health facilities and services. Other
programs, such as guaranteed student loans and child support enforcement, had specific rules related to calculating
reduction amounts.
10 Generally, the budget resolution establishes an annual agreement between the House and Senate on budgetary levels
for the upcoming fiscal year (and at least four additional years). The budget resolution does not become law, and no
money is spent or collected as a result of its adoption. Instead, it is an agreement between the House and Senate meant
to assist Congress in developing federal budget policy.
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Balanced Budget and Emergency Deficit Control Reaffirmation Act
of 1987
President Reagan signed into law the Balanced Budget and Emergency Deficit Control
Reaffirmation Act of 1987 (P.L. 100-119) on September 29, 1987, as part of legislation increasing
the debt limit to $2.8 trillion.
Congress revisited the BBEDCA for two primary reasons: (1) reaching the deficit targets proved
more difficult than expected, and (2) the Supreme Court had invalidated the sequestration
mechanism in the form that had been included in BBEDCA in Bowsher v. Synar, ruling that the
Comptroller General, as an official of the legislative branch, could not compel a sequestration
order that was to be issued by the President.
The 1987 act also extended by two years the time frame set out in the 1985 act for achieving a
balanced budget (requiring a balanced budget by FY1993 instead of FY1991) and revised the
deficit targets accordingly. The revised deficit targets maintained a year-to-year decrease, similar
to that of the 1985 act. The 1987 act rectified the invalidated sequestration mechanism by instead
using a report submitted by the director of the Office of Management and Budget (OMB) as the
trigger for the President’s sequestration order for FY1988-FY1993.
Budget Enforcement Act of 1990
President George H. W. Bush signed into law the Budget Enforcement Act of 1990 (BEA; P.L.
101-508) on November 5, 1990, as part of reconciliation legislation that also increased the debt
limit to $4.145 trillion. The legislation was projected to reduce the deficit by $482 billion over
five years, including $158 billion in revenue increases and $324 billion in spending cuts and debt
service savings.11
Continuing difficulties and concerns associated with deficit targets and the sequester mechanism
under BBEDCA prompted Congress and the President to enact the BEA, fundamentally revising
the budget enforcement procedures under BBEDCA. Whereas BBEDCA sought to use budget
controls to force future deficit reduction legislation, BEA sought to use budget controls to
preserve the deficit reduction being achieved in the accompanying reconciliation legislation.
BEA shifted the focus on budgetary outcomes to a focus on congressional consideration of
budgetary legislation, replacing deficit targets under BBEDCA with a two-pronged procedural
approach to budgetary enforcement: (1) discretionary spending limits to control the growth of
discretionary spending and (2) PAYGO procedures to prevent new direct spending and revenue
legislation from increasing the deficit.
Discretionary Spending Caps
BEA established statutory caps to limit discretionary spending.12 These limits were divided into
categories for the first three years covered. FY1991-FY1993 had three separate limits for defense,

11 The budget reconciliation process is an optional, expedited legislative process provided under the Congressional
Budget and Impoundment Control Act. It consists of several different stages, beginning with the adoption of the budget
resolution. The purpose of the reconciliation process is to allow Congress to use special procedures when considering
legislation that would bring existing budgetary laws into compliance with the fiscal policies that Congress establishes
in the annual budget resolution. For more information, see CRS Report R40480, Budget Reconciliation Measures
Enacted into Law Since 1980, by Megan S. Lynch.
12 Discretionary spending is controlled through the appropriations process and is generally provided annually. The
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international, and domestic nondefense spending. For FY1994 and FY1995, there was to be a
single limit on the total amount of discretionary spending for the year.
Creating separate categories of spending limits demonstrated preferences, limited tradeoffs, and
ensured predictability for specific types of spending. While it took away some flexibility for
future negotiation, Congress still had the authority to spend within the categories at their own
discretion.
Such spending limits were enforced by points of order during consideration on the House and
Senate floor, as well as after enactment by a sequestration process that required the President to
cancel budget authority by a uniform percentage within a category if there were a breach in the
spending limit for one or more of the statutory categories. In this way, the sequester was targeted
to the spending that had caused the breach.
If a breach of discretionary spending limits occurred, a sequester would be issued at the end of the
congressional session, although a sequester order could also be made within a session if
supplemental appropriations increased spending above the spending cap during the current year.
Enforcement of discretionary limits, therefore, could occur at various stages of the legislative
process, from consideration of specific spending measures on the floor to after enactment of all
spending bills at the end of the year.
The discretionary spending limits could be adjusted to take into account changes in budgetary
concepts and definitions, changes in inflation (for FY1993 and FY1994), changes in estimates of
credit subsidy costs to allow for specified allowances (such as emergency appropriations), IRS
tax compliance funding, and debt forgiveness (for Egypt and Poland). Such adjustments would be
made three times per year: (1) in a sequestration preview report included in the President’s annual
budget submission; (2) in a sequestration update report, issued in August; and (3) in a final
sequestration report, issued 15 days after the adjournment of Congress.
PAYGO Procedures
While discretionary spending caps limited spending in appropriations bills, BEA also created a
PAYGO procedure requiring that the aggregate impact of all new direct spending and revenue
legislation not increase the deficit. Any new legislation that would increase direct spending or
decrease revenues would have to be offset by other legislation so that the net deficit would not be
increased. PAYGO was not designed to limit the effects of any direct spending or revenue law
already in effect.
PAYGO was to be enforced on an annual (rather than a case-by-case) basis. The impact of new
direct spending and revenue legation was recorded on a rolling PAYGO “scorecard” maintained
by OMB. A violation would occur if the net effect of legislation enacted during the session (when
combined with any carryover PAYGO balance from previous years) would result in a net increase
in the deficit.
Sequestration procedures, similar to those used under BBEDCA, would be used to offset the
amount of any net increase in the deficit for that fiscal year or the previous fiscal year caused by
the enactment of new direct spending or revenue legislation. To ensure that all direct spending
and revenue legislation was accounted for on the PAYGO scorecard, the budgetary effect of any
such legislation enacted during a session (but after the final sequestration report had been issued)

appropriations committees have jurisdiction over the funding for discretionary spending programs, while authorizing
committees have jurisdiction over the funding for mandatory (or direct) spending programs. For more information, see
CRS Report R47106, The Appropriations Process: A Brief Overview, by James V. Saturno and Megan S. Lynch.
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was to be recorded on the PAYGO scorecard in the following session. Funds designated as
emergency spending were exempt from calculations.
The sequestration order would make cuts to all non-exempt direct spending programs. Programs
exempt from sequestration included Social Security (except for administrative expenses) and
railroad retirement. Other programs were protected though not exempt from sequestration. For
example, reductions in Medicare spending were limited to 4%, and other special rules applied to
specific programs. As with BBEDCA, this created a situation in which the enactment of new
direct spending could potentially trigger sequestration that would reduce spending for programs
that might not necessarily have grown or might have already been reduced through the legislative
process. Further, effects of legislation to decrease revenues could trigger a sequester and therefore
make reductions to spending to effectively offset those revenue decreases.
Extensions of BEA in the Omnibus Budget Reconciliation Act of
1993
President Clinton signed into law the Omnibus Budget Reconciliation Act of 1993 (P.L. 103-66)
on August 10, 1993, which included language increasing the debt limit to $4.9 trillion. The act
also included provisions that were projected to reduce the deficit by $496 billion over five years,
including $241 billion in revenue increases and $255 billion in spending cuts and debt service
savings.13
The act included an extension of discretionary spending caps and PAYGO procedures established
in the BEA in 1990. The act extended PAYGO procedures though 1998 and established new
discretionary spending caps for FY1996-FY1998 while retaining the existing caps for FY1994
and FY1995. In addition, the procedures for enforcing the spending caps and the PAYGO
procedure were extended through FY1998.
Budget Enforcement Act of 1997
President Clinton signed into law the Budget Enforcement Act of 1997 as part of reconciliation
legislation (P.L. 105-33) on August 5, 1997. The legislation also increased the debt limit to $5.95
trillion. The act, along with a tax reconciliation act enacted that day, were collectively projected
to reduce the deficit by $118 billion over five years, including spending cuts and debt service
savings of $198 billion and $80 billion in revenue reductions.
The act extended discretionary spending limits through FY2002. The discretionary spending
limits were divided into three categories for FY1998 and FY1999: defense, nondefense, and
crime reduction. For FY2000, there were two discretionary spending limits: one for crime
reduction and one for all other discretionary spending. For FY2001 and FY2002, there was just
one overall discretionary spending limit.14
The act also extended the PAYGO procedures to apply to legislation enacted through FY2002,
although the enforcement would continue through FY2006 to ensure that future impact of the

13 For more information, see CRS Report R40480, Budget Reconciliation Measures Enacted into Law Since 1980, by
Megan S. Lynch.
14 The act also made other types of budget process changes. For instance, the act made permanent the temporary
requirement set forth in the BEA of 1990 that budget resolutions cover at least a five-year period instead of the
previously required three-year period. Also, the act amended the deadline for committees to submit their views and
estimates to the Budget Committee from February 25 to within six weeks after submission of the President’s budget.
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legislation would be controlled. The act also reset all existing PAYGO balances to zero and
excluded the savings stemming from the two reconciliation bills from any PAYGO calculations to
offset any future deficit increases.15
For more information on budgetary controls during the 1980s and 1990s, see CRS Report
R41901, Statutory Budget Controls in Effect Between 1985 and 2002, by Megan S. Lynch.
Statutory PAYGO Act of 2010
President Obama signed into law the Statutory Pay-As-You-Go Act of 2010 (Statutory PAYGO;
P.L. 111-139) on February 12, 2010, as part of legislation that also increased the debt limit to
$14.3 trillion.16
The act re-established the budget enforcement mechanism commonly referred to as “Statutory
PAYGO,” which is similar to the PAYGO process established by the BEA of 1990, but unlike the
BEA, there are no expiration dates in the act, which makes Statutory PAYGO effectively
permanent. According to Section 2 of the act, it is generally intended to “enforce a rule of budget
neutrality on new revenue and direct spending legislation” based on the net effect of all such
legislation on the deficit over five- and 10-year periods.
To enforce Statutory PAYGO, OMB is required to record the budgetary effects of newly enacted
revenue and direct spending legislation on two separate scorecards: one that covers a five-year
period and one that covers a 10-year period. The budgetary effect of PAYGO measures is
determined by statements inserted into the Congressional Record by the chairs of the House and
Senate Budget Committees and referenced in the text of the measures. If this procedure is not
followed, OMB determines the budgetary effect of the measure. Each year, OMB is required to
issue an annual PAYGO report not later than 14 days (excluding weekends and holidays) after
Congress adjourns to end a session.
If the net effect of all PAYGO legislation is an increase in the deficit, the President must issue a
sequestration order, which automatically implements across-the-board cuts to nonexempt direct
spending programs to compensate for the amount of the debit. Section 11 of the act exempts some
direct spending programs and activities from sequestration, such as Social Security and Medicaid.
Medicare is limited to a 4% cut.17
While Statutory PAYGO is still in effect, when legislation is enacted that is projected to increase
the deficit, the text will often include a provision exempting the legislation’s budgetary effects
from OMB’s PAYGO scorecard.18 Further, when the PAYGO scorecard has shown a balance at
the end of a calendar year, Congress has moved the balance to a future year’s scorecard.19

15 The PAYGO procedures adopted in this act were effectively terminated in December 2002 by the enactment of H.R.
5708 (107th Congress), which set all PAYGO balances to zero to prevent the occurrence of a PAYGO sequester for
FY2003 and thereafter. President George W. Bush signed the bill into law on December 2, 2002 (P.L. 107-312).
16 For more information on Statutory PAYGO, see CRS Report R41157, The Statutory Pay-As-You-Go Act of 2010:
Summary and Legislative History, by Bill Heniff Jr.
17 To see a list of nonexempt direct spending programs that would likely be affected by sequestration under Statutory
PAYGO, see OMB, OMB REPORT TO THE CONGRESS, March 28, 2022.
18 For example, Section 201(a) of P.L. 117-180, stated, “The budgetary effects of this division and each succeeding
division shall not be entered on either PAYGO scorecard maintained pursuant to section 4(d) of the Statutory Pay-As-
You-Go Act of 2010.”
19 In March 2021, a reconciliation bill, the American Rescue Plan Act (P.L. 117-2) was enacted that was projected to
increase the deficit by approximately $1.856 trillion over the period FY2021-FY2030 and did not include a PAYGO
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Budget Control Act of 2011
President Obama signed into law the Budget Control Act of 2011 (BCA; P.L. 112-25) on August
2, 2011. The law included an authorization for the President to increase the debt limit by at least
$2.1 trillion (and up to $2.4 trillion) in three separate installments.
While the federal budget recorded surpluses during FY1998-FY2001, budget deficits returned in
FY2002 and slowly increased over the next several years due to reduced revenues and increased
spending. As illustrated in Figure 1, net deficits peaked, however, during the Great Recession
from FY2009 to FY2011, with deficits averaging 9.0% of GDP, which was higher than any other
year since World War II.20 The deficits during the Great Recession were attributed to negative and
low economic growth coupled with economic stimulus provided by the American Recovery and
Reinvestment Act of 2009 (P.L. 111-5).
To address rising deficits, the BCA included several interconnected components related to the
federal budget, most of which are no longer in effect. There were five primary components:
1. An authorization for the executive branch to increase the debt limit in three
installments, subject to disapproval by Congress.21 (Those provisions were temporary and
are no longer in effect.)
2. A one-time requirement for Congress to vote on an amendment to the Constitution to
require a balanced budget.22 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.
3. The establishment of statutory discretionary spending caps for FY2012-FY2021,
similar to those on discretionary spending, had previously been in effect between FY1991
and FY2002 (as described above). Under the BCA, for each fiscal year, two separate
spending limits were in effect: one for defense discretionary spending and one for
nondefense discretionary spending.23 The act did not specify any policy changes that

waiver. Its effects were therefore placed on the PAYGO scorecard. In December 2021, legislation was enacted that
removed its budgetary effects from the FY2022 PAYGO scorecards and added them to the scorecards for FY2023. In
December 2022, the Consolidated Appropriations Act, 2023 (P.L. 117-328), removed the debits from the FY2023
scorecard and placed them on the FY2025 scorecard. In addition, the bill states that any debit acquired on the FY2024
scorecard should be removed and placed on the FY2025 scorecard as well.
20 The Great Recession describes the contractionary period (which lasted from December 2007 to June 2009) and
subsequent recovery of the U.S. economy.
21 First, the act stated that once the President certified that the debt was within $100 billion of its limit, the limit would
be increased by $400 billion. Next, so long as no law was enacted within 50 calendar days of the first certification
disapproving of a further increase, the President could increase the debt limit by another $500 billion. And lastly, after
that $900 billion increase in the debt limit, if the President again certified that the debt was within $100 billion of its
limit, the debt limit could be increased once more (so long as no legislation had been enacted disapproving of the third
installment). The amount permitted in the third installment would be $1.2 trillion unless (1) legislation produced by the
Joint Select Committee on Deficit Reduction was enacted, in which case the debt limit could be increased by an equal
amount up to $1.5 trillion; or (3) if Congress passed and submitted to the states for ratification a constitutional
amendment requiring a balanced budget, in which case it could be raised by $1.5 trillion.
22 For more information, see CRS Report R41907, A Balanced Budget Constitutional Amendment: Background and
Congressional Options, by James V. Saturno and Megan S. Lynch.
23 The statutory limits included in the BCA were described in statute as security and nonsecurity. The security category
was defined to include discretionary appropriations classified as budget function 050 (national defense) only, and the
nonsecurity category was 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;
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should be made under such limits, leaving Congress and the President to negotiate them
in subsequent appropriations legislation.
To enforce the spending limits, the law required that if discretionary appropriations were
enacted that exceeded a statutory limit for a fiscal year, sequestration would be triggered,
reducing nonexempt budgetary resources within the applicable category (defense or
nondefense).
When the BCA was enacted, Congress and the President ensured that certain types of
spending would be effectively exempt from the limits. Specifically, the BCA stipulated
that the enactment of certain spending—such as appropriations designated as emergency
requirements or for overseas contingency operations—allowed for an upward adjustment
of the discretionary limits, meaning that such spending was effectively exempt from the
limits.24
After enactment of the BCA, Congress and the President enacted legislation increasing
the discretionary spending limits for almost every fiscal year in which they were effect
(for each year from FY2013 through FY2021). Some of these changes were included as
part of debt limit legislation and are described below. For more information on the
spending limits, including a summary of all changes made to the limits, see CRS Report
R46752, Expiration of the Discretionary Spending Limits: Frequently Asked Questions,
by Megan S. Lynch and Grant A. Driessen.
4. The establishment of the Joint Select Committee on Deficit Reduction (often referred
to as “the Joint Committee” or “the super committee”). The committee comprised 12
Members from the House and Senate—three chosen by each of the chambers’ party
leaders.25 The committee was instructed to develop legislation to reduce the budget
deficit by at least $1.5 trillion over the 10-year period FY2012-FY2021.26 Legislation
reported by the committee would then be eligible to be considered under special
expedited procedures in both the House and Senate.27 The act did not specify which
policy changes should be made to achieve deficit reduction, leaving the committee to
negotiate over possible revenue increases and spending decreases. The committee held
hearings between September and November 2011 and received recommendations for
deficit reduction from House and Senate committees.28 Ultimately, the committee did not

and all accounts in the international affairs budget function (budget function 150). It 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 when the Joint
Committee on Deficit Reduction failed to report a bill making recommendations for reducing the deficit.
24 For more information, see, Exceptions to the Budget Control Act’s Discretionary Spending Limits, by Megan S.
Lynch.
25 Members were Rep. Jeb Hensarling (R-TX), Co-Chair; Sen. Patty Murray (D-WA.), Co-Chair; Sen. Max Baucus (D-
MT); Rep. Xavier Becerra (D-CA); Rep. Dave Camp (R-MI); Rep. Jim Clyburn (D-SC); Sen. John Kerry (D-MA);
Sen. Jon Kyl (R-AZ); Sen. Rob Portman (R-OH); Sen. Pat Toomey (R-PA); Rep. Fred Upton (R-MI); and Rep. Chris
Van Hollen (D-MD).
26 The automatic process to reduce spending (described below) was designed to be triggered only if legislation reported
by the committee reducing the deficit by at least $1.2 trillion were not enacted.
27 These procedures are especially important in the Senate as they include a limit on debate time. This means the
legislation does not require the support of three-fifths of Senators to bring debate to a close. To trigger these
procedures, the legislative proposal was required to be reported by the committee by November 23, 2011. The
expedited procedures could have been used on such a proposal only through December 23, 2011.
28 For more information, see the archived website of the Joint Select Committee on Deficit Reduction, available at
https://cybercemetery.unt.edu/archive/deficit/20120113171424/http://www.deficitreduction.gov/public/index.cfm.
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reach agreement on a proposal, triggering the automatic spending reduction process
described below.
5. An automatic process to reduce spending, beginning in 2013, if Congress and the
President did not enact a bill reported by the joint committee reducing the deficit by at
least $1.2 trillion. (Such a bill was not enacted.) This automatic process required annual
downward adjustments of the discretionary spending limits, as well as an annual
sequester of nonexempt mandatory spending programs.
Bipartisan Budget Act of 2015
President Obama signed into law the Bipartisan Budget Act of 2015 (BBA 2015; P.L. 114-74) on
November 2, 2015. The bill included various provisions, including a suspension of the debt limit
through March 15, 2017. The law specified that on March 16, 2017, the debt limit would be
increased to accommodate obligations issued during the suspension period.
The BBA 2015 made changes to the budget enforcement mechanism established under the
BCA.29 Some of these changes were projected to increase the deficit, while some were projected
to decrease the deficit.30 The BBA 2015 increased the discretionary spending limits established
under the BCA for both defense and nondefense for FY2016, each by $25 billion. In addition, it
increased discretionary spending limits for both defense and nondefense for FY2017, each by $15
billion.
It also extended the direct spending sequester established by the BCA by one year through
FY2025. In addition, it established nonbinding spending targets for Overseas Contingency
Operations/Global War on Terrorism levels for FY2016 and FY2017 and amended the limits of
adjustments allowed under the discretionary spending limits for Program Integrity Initiatives.31
Bipartisan Budget Act of 2018
President Trump signed into law the Bipartisan Budget Act of 2018 (BBA 2018, P.L. 115-123) on
February 9, 2018. It included various provisions, such as a continuing resolution and a suspension
of the public debt limit through March 1, 2019. The law specified that on March 2, 2019, the limit
would be increased to the level necessary to accommodate any obligations issued during the
suspension period.

29 Other changes to the BCA had previously been enacted. The American Taxpayer Relief Act of 2012 (P.L. 112-240)
postponed the start of FY2013 sequester from January 2 to March 3 and reduced the amount of the spending reductions
by $24 billion, among other things. The Bipartisan Budget Act of 2013 (P.L. 113-67, referred to as the Murray-Ryan
agreement) increased discretionary spending limits for both defense and nondefense for FY2014, each by about $22
billion. In addition, it increased discretionary spending limits for both defense and nondefense for FY2015, each by
about $9 billion. It also extended the mandatory spending sequester by two years through FY2023. Soon after the
enactment of this bill, another 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 direct spending sequester by one year through FY2024.
30 U.S. Congressional Budget Office, Cost Estimate for H.R. 1314, Bipartisan Budget Act of 2015, October 28, 2015,
https://www.cbo.gov/publication/50938.
31 For more information, see CRS Report R44874, The Budget Control Act: Frequently Asked Questions, by Grant A.
Driessen and Megan S. Lynch; and archived 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).
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Changes to the BCA
Like the BBA 2015, the BBA 2018 made changes to the budget enforcement mechanism
established under the BCA, some of which were projected to increase the deficit and some of
which were projected to decrease the deficit.32 For FY2018, the BBA 2018 increased the defense
limit by $80 billion and increased the nondefense limit by $63 billion. For FY2019, it increased
the defense limit by $85 billion and increased the nondefense limit by $68 billion. BBA 2018 also
extended the mandatory spending sequester by two years through FY2027.
Joint Select Committee on Budget and Appropriations Process Reform
The BBA 2018 also created a joint select committee charged with formulating recommendations
and legislative language to “significantly reform the budget and appropriations process.” The
Joint Select Committee on Budget and Appropriations Process Reform was to be made up of 16
Members from the House and Senate—four chosen by each of the chambers’ party leaders.33 The
law directed the committee to make a report no later than November 30, 2018, to be submitted,
along with legislative language, to the President, the Speaker of the House, and the majority and
minority leaders of the House and Senate. Any legislation reported by the committee would be
considered under regular procedures (unlike in the BCA, which stated that legislation reported by
the Joint Select Committee on Deficit Reduction would be eligible to be considered under special
expedited procedures in both the House and Senate).
During its lifespan, the joint select committee held five days of hearings, taking testimony from
12 outside witnesses and 27 Members, including members of House leadership.
Formal and informal discussions among committee members resulted in draft legislation to be
considered in a markup that concluded on November 29, 2018. The chief recommendation in the
draft provided for the budget resolution to be adopted for a two-year cycle rather than the current
annual cycle. By unanimous consent, the committee members applied a voting rule for the
adoption of amendments consistent with the rule required by the act for final adoption of any
recommendations requiring separate majorities of the appointees from each party. The final vote
on reporting the bill, as amended, failed to achieve the threshold required for reporting under the
act.
For more information on the committee, see CRS Report R45111, The Joint Select Committee on
Budget and Appropriations Process Reform, by Megan S. Lynch and James V. Saturno.
Bipartisan Budget Act of 2019
President Trump signed into law the Bipartisan Budget Act of 2019 (BBA 2019, P.L. 116-37) on
August 2, 2019. Among other provisions, it included a suspension of the debt limit through July
31, 2021. The law specified that on August 1, 2021, the limit would be increased to accommodate
obligations issued during the suspension period.

32 U.S. Congressional Budget Office, Cost Estimate for Bipartisan Budget Act 2018, February 8, 2018,
https://www.cbo.gov/publication/53556.
33 Members were Rep. Nita M. Lowey (D-NY), Co-chair); Rep. Steve Womack (R-AR), Co-chair); Rep. Jodey
Arrington (R-TX); Sen Michael F. Bennet (D-CO); Sen. Roy Blunt (R-MO); Sen. Joni Ernst (R-IA); Sen. Mazie K.
Hirono (D-HI); Rep. Derek Kilmer (D-WA); Sen. James Lankford (R-OK); Sen. David Perdue (R-GA); Rep. Lucille
Roybal-Allard (D-CA); Rep. Pete Sessions (R-TX); Sen. Brian Schatz (D-HI); Sen. Sheldon Whitehouse (D-RI); Rep.
Rob Woodall (R-GA); and Rep. John Yarmuth (D-KY).
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Like the BBA 2015 and BBA 2018, the BBA 2019 made changes to the budget enforcement
mechanism established under the BCA, some of which were projected to increase the deficit and
some of which were projected to decrease the deficit.34 For FY2020, it increased the discretionary
defense cap by $90 billion and increased the nondefense cap by $78 billion. For FY2021, it
increased the discretionary defense cap by $81 billion (to $672 billion) and increased the
nondefense cap by $72 billion (to $627 billion). BBA 2019 also extended the mandatory spending
sequester by two years through FY2029.
In addition to making changes to the mechanisms enacted in the BCA, the BBA 2019 set the
PAYGO scorecard balances (established by the Statutory PAYGO Act of 2010) to zero.35

34 U.S. Congressional Budget Office, Cost Estimate for Bipartisan Budget Act of 2019, July 23, 2019,
https://www.cbo.gov/publication/55478.
35 For more information, see OMB, 2019 Statutory Pay-As-You-Go Act Annual Report, January 27, 2020,
https://www.federalregister.gov/documents/2020/01/27/2020-01290/2019-statutory-pay-as-you-go-act-annual-report.
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Appendix. Statutory Debt Limit
This Appendix provides further context to the budget process reforms described above.
Specifically, Figure A-1 shows the amount of federal debt subject to the statutory limit over the
period of 1983-2023, and Table 1 provides information on the legislative changes to the debt
limit since 1983.
Figure A-1. Debt Subject to Statutory Limit

Source: U.S. Government Publishing Office, Budget of the United States Government, FY2016-FY2023, Historical
Tables; Table 7.2—Debt Subject to Statutory Limit: 1940-2027, March 28, 2022, https://www.whitehouse.gov/
omb/budget/historical-tables/.
Notes: FY2022 and FY2023 are estimates.
Table A-1. Statutory Limits on Federal Debt Since 1983
In Billions of Dollars
Statute
Date
Description
Limit
97 Stat. 196
May 26, 1983
Eliminated the distinction between permanent and
1,389.0
temporary limit with the enactment of a single
permanent limit. Raised the debt limit to:
97 Stat. 1012
November 21,
Increased the debt limit to:
1,490.0
1983
98 Stat. 217
May 25, 1984
Increased the debt limit to:
1,520.0
98 Stat. 313
July 6, 1984
Increased the debt limit to:
1,573.0
98 Stat. 2206
October 13,
Increased the debt limit to:
1,823.8
1984
99 Stat. 814
November 14,
Increased the debt limit temporarily through
1,903.8
1985
December 6, 1985, to:
99 Stat. 1037
December 12,
Increased the debt limit to:
2,078.7
1985
100 Stat. 818
August 21, 1986
Increased the debt limit to:
2,111.0
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Statute
Date
Description
Limit
100 Stat. 1968
October 21,
Increased the debt limit temporarily through May
2,300.0
1986
15, 1987, to:
101 Stat. 308
May 15, 1987
Increased the debt limit temporarily through July
2,320.0
17, 1987, to:
101 Stat. 542
July 30, 1987
Increased the debt limit temporarily through
2,320.0
August 6, 1987, to:
101 Stat. 550
August 10, 1987
Increased the debt limit temporarily through
2,352.0
September 23, 1987, to:
101 Stat. 754
September 29,
Increased the debt limit to:
2,800.0
1987
103 Stat. 182
August 7, 1989
Increased the debt limit temporarily through
2,870.0
October 31, 1989, to:
103 Stat. 830
November 8,
Increased the debt limit to:
3,122.7
1989
104 Stat. 403
August 9, 1990
Increased the debt limit temporarily through
3,195.0
October 2, 1990, to:
104 Stat. 878
October 2, 1990
Increased the debt limit temporarily through
3,195.0
October 6, 1990, to:
104 Stat. 897
October 9, 1990
Increased the debt limit temporarily through
3,195.0
October 19, 1990, to:
104 Stat. 1033
October 19,
Increased the debt limit temporarily through
3,195.0
1990
October 24, 1990, to:
104 Stat. 1078
October 25,
Increased the debt limit temporarily through
3,195.0
1990
October 27, 1990, to:
104 Stat. 1087
October 28,
Increased the debt limit temporarily through
3,230.0
1990
November 5, 1990, to:
104 Stat. 1388-560
November 5,
Increased the debt limit to:
4,145.0
1990
107 Stat. 42
April 6, 1993
Increased the debt limit temporarily through
4,370.0
September 30, 1993, to:
107 Stat. 565
August 10, 1993
Increased the debt limit to:
4,900.0
110 Stat. 55
February 8, 1996
Temporarily exempted from limit obligations in an

amount equal to the monthly insurance benefits
payable under Title II of the Social Security Act in
March 1996, the exemption to expire on the
earlier of an increase in the limit or March 15,
1996.
110 Stat. 825
March 12, 1996
Temporarily exempted from limit (a) obligations in

an amount equal to the monthly insurance benefits
payable under Title II of the Social Security Act in
March 1996 and (b) certain obligations issued to
trust funds and other federal government
accounts, both exemptions to expire on the
earlier of an increase in the limit or March 30,
1996.
110 Stat. 875
March 29, 1996
Increased the debt limit to:
5,500.0
111 Stat. 648
August 5, 1997
Increased the debt limit to:
5,950.0
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Statute
Date
Description
Limit
116 Stat. 734
June 28, 2002
Increased the debt limit to:
6,400.0
117 Stat. 710
May 27, 2003
Increased the debt limit to:
7,384.0
118 Stat. 2337
November 19,
Increased the debt limit to:
8,184.0
2004
120 Stat. 289
March 20, 2006
Increased the debt limit to:
8,965.0
121 Stat. 988
September 29,
Increased the debt limit to:
9,815.0
2007
122 Stat. 2908
July 30, 2008
Increased the debt limit to:
10,615.0
122 Stat. 3790
October 3, 2008
Increased the debt limit to:
11,315.0
123 Stat. 366
February 17,
Increased the debt limit to:
12,104.0
2009
123 Stat. 3483
December 28,
Increased the debt limit to:
12,394.0
2009
124 Stat. 8
February 12,
Increased the debt limit to:
14,294.0
2010
125 Stat. 251
August 2, 2011
Increased the debt limit to:
14,69
Effective after September 21, 2011, increased the
4.0
debt limit to:

Effective after January 27, 2012, increased the debt
15,19
limit to:
4.0

16,394.0
127 Stat. 51
February 4, 2013 Suspended the existing debt limit from February 4,
16,699.4
2013, through May 18, 2013, and prospectively
increased the limit to accommodate the increase
in such debt outstanding as of May 19, 2013.
Effective May 19, 2013, reestablished the debt limit
at:
127 Stat. 566
October 17,
Suspended the existing debt limit from October
17,211.6
2013
17, 2013, through February 7, 2014, and
prospectively increased the limit to accommodate
the increase in such debt outstanding as of
February 8, 2014.
Effective February 8, 2014, reestablished the debt
limit at:
128 Stat. 1011
February 15,
Suspended the existing debt limit from February
18,113.0
2014
15, 2014, through March 15, 2015, and
prospectively increased the limit to accommodate
the increase in such debt outstanding as of March
16, 2015.
Effective March 16, 2015, reestablished the debt
limit at:
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Statute
Date
Description
Limit
129 Stat. 620
November 2,
Suspended the existing debt limit from November
19,808.8
2015
2, 2015, through March 15, 2017, and
prospectively increased the limit to accommodate
the increase in such debt outstanding as of March
16, 2017.
Effective March 16, 2017, reestablished the debt
limit at:
131 Stat. 1139
September 8,
Suspended the existing debt limit from September
20,456.0
2017
8, 2017, through December 8, 2017, and
prospectively increased the limit to accommodate
the increase in such debt outstanding as of
December 9, 2017.
Effective December 9, 2017, reestablished the
debt limit at:
132 Stat. 132
February 9, 2018
Suspended the existing debt limit from February 9,
21,987.7
2018, through March 1, 2019, and prospectively
increased the limit to accommodate the increase
in such debt outstanding as of March 1, 2019.
Effective March 1, 2019, reestablished the debt
limit at:
133 Stat. 1057
August 2, 2019
Suspended the existing debt limit from August 2,
28,401.5
2019, through July 31, 2021, and prospectively
increased the limit to accommodate the increase
in such debt outstanding as of July 31, 2021.
Effective August 1, 2021, reestablished the debt
limit at:
135 Stat. 407
October 14,
Increased the debt limit to:
28,881.5
2021
135 Stat. 1514
December 16,
Increased the debt limit to:
31,381.5
2021
Source: U.S. Government Publishing Office, Budget of the United States Government, FY2016-FY2023, Historical
Tables; Table 7.3—Statutory Limits on Federal Debt: 1940-Current, March 28, 2022, https://www.whitehouse.gov/
omb/budget/historical-tables/.

Author Information

Megan S. Lynch

Specialist on Congress and the Legislative Process

Acknowledgments
CRS Visual Information Specialist Amber Wilhelm created the graphics in this report.
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Budget Process Reforms Included in Debt Limit Legislation

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