Passing the Budget: Does the Current Federal Appropriations Process Work?

The framers granted Congress the exclusive power of the purse. The Constitution states “[n]o money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.”[1] More recently, the current federal budget appropriation process was established through the Congressional Budget and Impoundment Control Act of 1974.[2] As today’s headlines demonstrate, it does not appear as though the current appropriations process works according to the original design. The appropriations process seems to increasingly be used as a political tool. For example, in November, President Trump threatened another government shutdown in what appeared to be a response to the House of Representatives Impeachment proceedings.[3]  However, based on congressional statistics alone, the current budget process has departed from the normal order in three substantial ways: (1) appropriation legislation rarely passes on-time, (2) Congress continuously relies on stop-gap funding measure that extend over longer periods of the fiscal year, and (3) Congress has increasingly consolidated appropriation legislation into large omnibus bills instead of passing them in smaller appropriations organized by subject matter.

1. An Overview of the Normal Appropriations Process

The appropriations process begins on the first Monday in February when the President submits the “President’s budget” to Congress.[4] The House of Representatives and the Senate then compile estimates on spending and revenue and by April 15, they provide the approximate agency budget authorities and expenditures.[5] The Appropriations Committee in the House then begins crafting twelve appropriations bills to fund different parts of the government.[6] There are twelve subcommittees dedicated to each bill, and they hold hearings on different and wide-ranging subject matters of the federal government from the “Subcommittee on Military Construction, Veterans Affairs, and Related Agencies” to the “Subcommittee on the Departments of Labor, Health and Human Services, Education, and Related Agencies.”[7] Once each bill is voted on by the full House, it goes to a matching subcommittee in the Senate, where the bill can be further modified, then subsequently voted on by the full Senate. [8]  Both chambers then hold a conference to resolve any differences and approve each bill “in precisely the same form.”[9] As each appropriation is passed, the President signs each bill into law within ten days of receipt and before the beginning of the fiscal year (FY) on October 1.[10]

2. Passing Appropriations by October 1

Even though Congress has several months to consider and pass each appropriation bill to meet the October 1 deadline, it is rare for Congress to do so.[11]  Since 1974, there have only been four fiscal years (FY 1977, FY 1989, FY 1995, and FY 1997) in which all individual appropriation bills were passed on-time prior to October 1.[12] According to the data in Graph 1, it appears to be the exception to the rule that all appropriations pass on-time.

Graph 1[13]

3. Stop-Gap Funding Measures: Continuing Resolutions

When Congress is unable to pass all twelve appropriations bills before October 1, they resort to passing a stop-gap resolution called a continuing resolution (“CR”) to avoid a government shutdown.[14] A CR establishes temporary funding in the “form of a joint resolution to allow agencies . . . [to operate] . . . at a particular rate for a specific period of time, which may range from a single day to an entire fiscal year.”[15] Generally, the rate of spending in a CR is based on rates from prior years and does not allow funding for new initiatives.[16] Government Accountability Office (GAO) case studies have noted that CRs can limit “decision-making options, making trade-offs more difficult” for agency officials because it results in the following negative impacts: administrative inefficiencies, hiring delays, delayed contracts or inefficient short-term contracts, and impeded use of funds from previous years.[17] The statistics on the durations of CRs in Graph 2 show that CRs regularly range from at least one quarter of the fiscal year to more than a third, and on rare occasion extends through a whole year. Thus, based on the impacts found through GAO studies, agencies often operate at reduced capacities for significant portions of the year.

Graph 2[18]

4. Consolidating the Appropriations: Omnibus Bills

Even if Congress manages to pass a budget, the budget is often consolidated into a large omnibus bill rather than the twelve appropriations.  An omnibus bill “combine[s] several bills together into a single legislative vehicle prior to enactment.”[19] Since an omnibus combines all of the separate appropriations together, it can provide an “efficient means for resolving outstanding differences within Congress or between Congress and the President” or “achieve a timely end to the annual appropriations process” since Congress only has to negotiate over one piece of legislation.[20] However, since an omnibus combines multiple appropriations, it is more difficult for Congress members to debate or amend the consolidated bill.[21] Executing the power of the purse becomes a daunting task when problems can be buried in a bill thousands of pages long. Often, attempts to address spending are done with broad strokes using across-the-board cuts, rather than addressing specific problems in each area.[22] Table 1 shows the number of bills passed as omnibus bills from FY 1986 to present day demonstrating the degree to which congress has departed from passing separate appropriations.

Table 1[23]

Against these three criteria, it does not appear as if the current appropriations process works according to the original design. Particularly in recent years, Congress has neither passed the budget on time, nor passed all twelve appropriations bills, sometimes resulting in a government shutdown. With the large size of the federal government and the growing national debt, it may point to the need for appropriations reform so Congress can better manage the federal budget in the future.


 

[1] U.S. Const. art. I, § 9.

[2] Pub. L. No. 93-344, as amended.

[3] Eric Katz, Trump Again Refuses to Rule Out a Shutdown, Government Executive (Nov. 4, 2019), https://www.govexec.com/management/2019/11/trump-again-refuses-rule-out-shutdown/161062/

[4] Congressional Budget Process: Timetable 2 U.S.C. § 631 (2019).

[5] Id. § 632.

[6] James V. Saturno, Cong. Research Serv., R42388, The Congressional Appropriations Process: An Introduction 4-5 (2016).

[7] James V. Saturno, Cong. Research Serv., RL31572, Appropriations Subcommittee Structure: History of Changes from 1920 to 2019 10-11 (2019).

[8] R42388 at 4-5.

[9] Id.

[10] 2 U.S.C. § 631.

[11] Until 2005, there were 13 appropriations. Between 2006-2007, there were 11 appropriations. Since 2008, there have been 12 appropriations. Kate P. McClanahan, Cong. Research Serv., R42647 Continuing Resolutions: Overview of Components and Practices 10-11 (2019).

[12] Id. at 9-11.

[13] Id at 10-11.

[14] Id. at 1.

[15] R42388 at 13.

[16] Id.

[17] Clinton T. Brass, Cong. Research Serv., RL34700, Interim Continuing Resolutions (CRs): Potential Impacts on Agency Operations 10-11 (2012).

[18] Id. at 12-13.

[19] Id. at 12-13.

[20] Id.

[21] Id. at 5.

[22] Id. at 7.

[23] James V. Saturno, Cong. Research Serv., RL32473, Omnibus Appropriations Acts: Overview of Recent Practices 6 (2016); Consolidated Appropriations Act 2017, Pub. L. No. 115-31, 131 Stat. 135; Vehicle for Consolidated Appropriations Act 2018, Pub. L. No. 115-141, 132 Stat. 348; Consolidated Appropriations Act 2019, Pub. L. No 116-6, 133 Stat. 13; FY2019 E&W, Leg. Branch and MCVA Consolidated Act, Pub. L. No. 115-244, 132 Stat. 2897; FY2019 Consolidated Defense, Labor-HHS-ED, & Continuing Resolution, Pub. L. No. 115-245, 132 Stat. 2981.

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