Who Controls the Federal Budget?



Procedures created by Congressional Budget and Impoundment Control Act of 1974


Executive prepares “budget request”

-        submitted by Feb.before the FY starts in Oct.

-        outlines what funding the president seeks, the purposes, and any changes to revenue policy the president would like to seek

-        is not introduced as legislation in any formal sense


Congress prepares “budget resolution”

-        Budget committees draft resolution

-        sets spending and revenue levels for committees to consider

-        done as “concurrent resolution”

o     not subject to presidential veto


Committees Roles

-        Standing committees then review administration proposals

o     pass authorizations for spending for certain functions


-        Appropriations committees and subcommittees develop bills to fund authorizations


“Reconciliation Process”

-        spending compared with revenues

-        House Ways and Means and Senate Finance committee alter tax law to reconcile spending with revenue


Reconciliation Bills

-        if discrepancies exist between revenue and spending Budget committees draw up a reconciliation bill

-        combines tax and spending measures


Each house votes separately


House-Senate conference committee reviews it

-        settle differences



Types of Spending

-        discretionary v. entitlements

-        most US spending is entitlements with spending set by prior laws

-        discretionary spending must authorized each year