Cyclopedia of Congressional Budget Law
Discretionary Spending Limits
Summary
The discretionary spending limits are the most accurate of the various terms used to refer to the amounts of budget authority (or outlays) set in statute which govern the maximum amount of discretionary spending allowable for a given fiscal year. The first statutory limits of this kind were established by the Budget Enforcement Act of 1990 (Pub. L. 101-508), and were extended by the Omnibus Budget Reconciliation Act of 1993 and the Budget Enforcement Act of 1997. They lapsed after fiscal year 2002 but were established by the Budget Control Act of 2011 (Pub. L. 112-25) for ten years and are now set in law through fiscal year 2021.
Though these discretionary spending limits are set in law, and any amounts spent above them would cause a sequester, they have been routinely ignored and simply changed through agreements between the President and Congress. Notable examples of these are the Bipartisan Budget Act of 2013 (Pub. L. 113-69), Bipartisan Budget Act of 2015 (Pub. L. 114-74), and the Bipartisan Budget Act of 2018 (Pub. L. 115-123).
Spending Categories
Security and nonsecurity Category: This category was established by the Budget Control Act of 2011 (BCA). It is essentially intertwined with the “security category”, which was also created by the BCA and defined in section 250(c)(4)(B) as follows:
… discretionary appropriations associated with agency budgets for the Department of Defense, the Department of Homeland Security, the Department of Veterans Affairs, the National Nuclear Security Administration, the intelligence community management account (95–0401–0–1–054), and all budget accounts in budget function 150 (international affairs).
The “nonsecurity category” is defined by section 250(c)(4)(A) as “all discretionary appropriations not included in the security category.” Neither of these categories ever took effect though, security category included discretionary budget authority for the Departments of Defense, Homeland Security, and Veterans Affairs, the National Nuclear Security Administration, the Intelligence Community Management account, and all budget accounts in the international affairs budget function (budget function 150). The nonsecurity category includes all discretionary budget authority not included in the security category. After the nonsecurity category was to expire, a single general discretionary category was to be in effect from fiscal years 2014 through 2021, Title I has a single spending category that covers all discretionary budget authority, with a specified spending limit for each of those years.
SEC. 250. TABLE OF CONTENTS; STATEMENT OF BUDGET ENFORCEMENT THROUGH SEQUESTRATION; DEFINITIONS.
(c) Definitions.—As used in this part:
(4)(A) The term “nonsecurity category” means all discretionary appropriations not included in the security category defined in subparagraph (B).
(B) The term “security category” includes discretionary appropriations associated with agency budgets for the Department of Defense, the Department of Homeland Security, the Department of Veterans Affairs, the National Nuclear Security Administration, the intelligence community management account (95–0401–0–1–054), and all budget accounts in budget function 150 (international affairs).
GAO Glossary of Terms and Definition (September 2005)
Spending Caps
Overall limits on discretionary spending, which were originally set in the Budget Enforcement Act (BEA) and the enforcement of which expired at the end of fiscal year 2002. Congress, however, continues to set limits on discretionary spending, typically in concurrent budget resolutions, which are enforceable during the congressional budget process.
(See also Discretionary; Concurrent Resolution on the Budget.)
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Adjustments Under the Budget Control Act of 2011
Section 254 (BBEDCA) requires OMB to submit a Sequestration Preview Report annually to Congress. In this report, the Office of Management and Budget (OMB) adjusts these discretionary spending limits by an amount calculated pursuant to section 251A(1) (BBEDCA) to achieve the deficit reduction intended by the Budget Control Act of 2011. OMB has been directed to not implement these by the Bipartisan Budget Agreement Act of 2013, the Bipartisan Budget Agreement Act of 2015, and the Bipartisan Budget Agreement Act of 2018, for each of fiscal years 2013 through 2019. They remain in force and are projected to occur for fiscal year 2020 and fiscal year 2021, unless they are deactivated by future legislation,
Section 302(a) and 314 of the Congressional Budget Act of 1974
Section 302(a)
The section 302(a) allocation parallels the discretionary spending limits, which is to say they are levels of spending that are annually appropriated. While the first is governed by Congressional rulemaking, and set through the adoption of a concurrent resolution on the budget, the latter is set in law and may only be amended (or evaded) through the enactment of subsequent legislation.
Section 314
Similarly, structured in the law are “adjustments” to the discretionary spending laws, such as for continuing disability reviews and for health care fraud and abuse. In 2018, two new adjustments were added: one for reemployment determinations, and another for wildfire suppression, by the Bipartisan Budget Act of 2018 and the Consolidated Appropriations Act, Fiscal Year 2018, respectively. These adjustments direct the Office of Management and Budget to raise the spending on these individual programs by a specified amount as long as the program receives a set amount, known as a “maintenance of effort” in the appropriation Act that funds them.
Section 314 (CBA) allows for a corresponding increase in the budget resolution to match the amount of the increase. In this way, the statutory limits and the rules based 302(a) allocation can remain, to some extent, linked.
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