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Budget process

Until 1974, the congressional budget process consisted of creating programs and funding them. In the 1970s, it became clear that there were conflicting priorities between the authorizing committees that created federal programs and the appropriating committees that funded them. The result was federal spending chaos and an ever-increasing federal deficit.

In an attempt to bring order to this problem, Congress enacted the Congressional Budget and Impoundment Control Act (P.L. 93-344) in 1974. This law established a procedure to help organize the many policy and spending decisions Congress makes every year into a coordinated whole.

Think of the budget process as a blueprint for the federal program and spending priorities as seen by the Congress. It establishes the overall parameters under which decisions about appropriations and authorizations can occur.

The budget process is designed to help lawmakers focus on overall goals rather than the piecemeal decisions that characterized congressional spending decisions in the past. It begins with the release of the President's proposed budget early in the year, along with detailed justification materials prepared by Federal agencies which are submitted to the House and Senate appropriations subcommittees with jurisdiction over the funding for each agency. The President is required to submit his budget for the upcoming fiscal year to Congress on or before the first Monday in February.  The Congressional Budget and Impoundment Control Act of 1974 requires Congress to adopt an annual budget resolution covering the upcoming fiscal year plus the four subsequent years before it enacts any appropriations. Congress is expected to adopt a budget resolution by April 15, but this deadline is frequently not met. The budget resolution establishes a target spending ceiling and revenue floor for the upcoming fiscal year. Further, the spending ceiling total is subdivided into separate functional category (or national priority) totals. The House and Senate Budget Committees have exclusive jurisdiction over budget resolutions and their enforcement.

The budget resolution follows the normal legislative process path up to the point where a bill would be sent to the President. Since the budget resolution is an internal congressional housekeeping measure, it does not go to the President for his signature and it is not considered binding on congressional decision-makers. Congress may adopt a later budget resolution that revises the previously adopted concurrent resolution. The budget resolution is adopted in the form of a concurrent resolution accompanied by a written report.

After Congress completes action on the concurrent resolution for a given fiscal year, it is generally not in order to consider legislation that does not conform to the constraints on spending and revenue set out in the resolution. The concurrent resolution includes language that instructs the House and Senate committees to recommend changes to achieve the constraints established in the concurrent resolution, and specifies the amount of spending reductions or revenue changes the committee must attain, but does not identify specific changes to be made.

The process of passing legislation that reflects the assumptions made in the concurrent resolution is called reconciliation. The reconciliation process is intended to bring existing law into conformity with the most recently adopted concurrent resolution. After both the House and Senate pass their versions of an appropriations bill, the bill is referred to a conference committee. Conference reports on appropriations may be accepted or rejected by either the House or the Senate, but they cannot be amended in either Chamber. If a conference report is rejected, the conferees negotiate further. Once the reconciliation bill passes both Chambers, it is sent to the President and is subject to the normal procedures governing Presidential action related to the enactment of a law.

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