Cyclopedia of Congressional Budget Law
Appropriated Entitlement
Summary
An appropriated entitlement, also known as an appropriated mandatory, is a direct spending program that falls into the entitlement definition, the funding of which is included in an appropriation bill. Even though the funding is carried in an annual appropriation measure, funding continues whether it is enacted or not, and is hence considered to be
GAO Glossary of Terms and Definition (September 2005)
Appropriated Entitlement (GAO)
An entitlement whose source of funding is in an annual appropriation act. However, because the entitlement is created by operation of law, if Congress does not appropriate the money necessary to fund the payments, eligible recipients may have legal recourse. Veterans’ compensation and Medicaid are examples of such appropriated entitlements. (See also Entitlement Authority.)
[PAGES 13]
Appropriated Entitlement (CRS)
The below CRS report uses the term “appropriated mandatory”, though it is synonymous with the term “appropriated entitlement”:
CRS – Overview of Funding Mechanisms in the Federal Budget Process, and Selected Examples (R44582 ) August 4, 2016, pp. 12-14.
Report on Appropriated Mandatory Spending
In the examples of mandatory funding mechanisms discussed above, the authorization law controls the amount of spending and also contains an appropriation to fund it. In contrast, for “appropriated mandatory” spending, which is sometimes referred to as “appropriated entitlement” spending, the authorization law controls the amount of spending but does not contain the necessary appropriation to fund it. Instead, such appropriations are provided through the annual appropriations process. The appropriated mandatory funding type is used for a number of federal programs, including the Supplemental Nutrition Assistance Program, Grants to States for Medicaid, the Trade Adjustment Assistance for Workers program, Special Benefits for Disabled Coal Miners, and veterans’ disability compensation and pensions.
Appropriated mandatory authorizations establish the program or activity but require that future funding be provided separately. This is because the authorization establishes an entitlement[50] to payments or other funding requirement that such payments be made. The amount of the payments may be based on an eligibility criteria or payment formula (such as in the example of the SSDI program above) or may be an amount specified in the statute. This is discussed further below. However, that entitlement or other requirement is not accompanied by appropriations language that provides the means for financing those payments. This creates a need for the authority to be enacted in appropriations acts.
While the funding for appropriated mandatory spending is provided in annual appropriations acts, those acts do not control the level of appropriations that are provided therein. This is because the level of appropriated mandatory spending, like other entitlements, is derived from authorization law, and the amount provided in appropriations acts is based on meeting this level. In other words, the authorizing statute for an appropriated entitlement establishes a legal obligation to make payments, and the funding in annual appropriations acts is provided as a means to fulfill that legal financial obligation.
In some cases, the total amount of the appropriation for an appropriated mandatory spending program is specified in authorizing statute, as exemplified by the HHS Social Services Block Grant (SSBG). The broad purpose of the SSBG funding for states and territories is to encourage economic self-sufficiency and support among families; prevent or remedy neglect, abuse, and exploitation of children and adults; prevent or reduce inappropriate institutional care by supporting community- and home-based care; and secure referral or admission for institutional care when other forms of care are not appropriate. States and territories use SSBG funds to support a wide variety of social services, including child care, foster care, and special services for the disabled. The authorizing statue for the SSBG specifies the following with regard to the funding for the program:
(a)(1) Each State shall be entitled to payment under this subtitle for each fiscal year in an amount equal to its allotment for such fiscal year, to be used by such State for services directed at the goals set forth in section 1397 of this title, subject to the requirements of this division.
(b) The Secretary shall make payments in accordance with section 6503 of title 31, United States Code, to each State from its allotment for use under this division. [42 U.S.C. 1397a]
The authorizing statute further specifies that the total amount of these payments to states and territories for FY2001 and each fiscal year thereafter shall be $1,700,000,000 (42 U.S.C. 1397b), but it does not provide an appropriation for that purpose. Instead, the SSBG appropriation is provided each fiscal year through the annual appropriations process, as was the case for FY2016:
The following sums in this Act are appropriated, out of any money in the Treasury not otherwise appropriated, for the fiscal year ending September 30, 2016. [P.L. 114-113, Sec. 5]
For making grants to States pursuant to section 2002 of the Social Security Act, $1,700,000,000. [P.L. 114-113, Division H, Title II]
Because the authorization law controls the amount of the SSBG appropriation and specifies that amount in statute, the role of appropriations acts each fiscal year is to provide funding sufficient to satisfy that amount.[51]
For other appropriated mandatory programs for which the authorization provides a formula, determining the amount and structure of the appropriation can be more complicated. An example of appropriated mandatory spending based on a formula is the Supplemental Security Income (SSI) program, which provides a basic level of income support to needy aged, blind, or disabled individuals.[52] Benefit levels and eligibility are based on an individual’s citizenship or immigration status, age, income, and other criteria. The SSI authorization does not place an aggregate limit on benefits:
For the purpose of establishing a national program to provide supplemental security income to individuals who have attained age 65 or are blind or disabled, there are authorized to be appropriated sums sufficient to carry out this title. [42 U.S.C. 1381]
Because the total number of SSI beneficiaries and the level of payments to which they are entitled vary from year to year, the funding that is provided through the annual appropriations process is based on a projection of benefits for the relevant fiscal year. The appropriation for FY2016 was as follows:
The following sums in this Act are appropriated, out of any money in the Treasury not otherwise appropriated, for the fiscal year ending September 30, 2016. [P.L. 114-113, Sec. 5]
For carrying out titles XI and XVI of the Social Security Act, section 401 of Public Law 92-603, section 212 of Public Law 93-66, as amended, and section 405 of Public Law 95- 216, including payment to the Social Security trust funds for administrative expenses incurred pursuant to section 201(g)(1) of the Social Security Act, $46,305,733,000, to remain available until expended… Provided further, That not more than $101,000,000 shall be available for research and demonstrations under sections 1110, 1115, and 1144 of the Social Security Act, and remain available through September 30, 2018.
For making, after June 15 of the current fiscal year, benefit payments to individuals under title XVI of the Social Security Act, for unanticipated costs incurred for the current fiscal year, such sums as may be necessary. [P.L. 114-113, Division H, Title IV]
The SSI appropriation is structured to include a definite amount for SSI benefits and administrative costs, and also an indefinite appropriation for any costs incurred for the current fiscal year after June 15.[53] This second component allows the Social Security Administration (SSA) to continue to pay SSI benefits in the event that benefit obligations are greater than expected during the last months of the fiscal year. (In the event that the definite appropriation is greater than the amount that ultimately is needed for benefits, the excess amount of the appropriation would go unspent.)
[50] Entitlements, including appropriated entitlements, are programs that require payments to persons, state or local governments, or other entities if specific eligibility criteria established in the authorization law are met. Entitlement payments are legal obligations of the federal government, and eligible beneficiaries may have legal recourse if full payment under the law is not provided.
[51] In previous fiscal years, and most recently in FY2013, additional appropriations above the amount specified in 42 U.S.C. 1397b have been provided through the appropriations process. For a discussion of such “changes in mandatory spending,” see “General Implications” within this section of the report and footnote 55. For further information about the SSBG program, including a comparison of amounts authorized and appropriated, see CRS Report 94-953, Social Services Block Grant: Background and Funding.
[52] The entitlement to SSI benefits is in 42 U.S.C. 1381a. (“Every aged, blind, or disabled individual who is determined under part A of this subchapter to be eligible on the basis of his income and resources shall, in accordance with and subject to the provisions of this subchapter, be paid benefits by the Commissioner of Social Security.”)
[53] SSI also is usually provided an advance appropriation for the first quarter of the next fiscal year. The concept of advance appropriations, including potential rationales for them, is discussed in CRS Report R43482, Advance Appropriations, Forward Funding, and Advance Funding: Concepts, Practice, and Budget Process Considerations.
Appropriated Entitlement (CRS)
“Entitlements are programs that require payments to persons, state or local governments, or other entities if specific eligibility criteria established in the authorizing law are met. Entitlement payments are legal obligations of the federal government, and eligible beneficiaries may have legal recourse if full payment under the law is not provided. This report provides a brief explanation of spending for entitlements, including so-called appropriated entitlements, and discusses the procedural and statutory constraints on legislation affecting such entitlement spending.”
The reference to “this report” is to the following:
List of Appropriated Entitlements in the BEA 1990 and the BEA 1997
As a part of two of budget agreements between the Congress and the President, each known as the “Budget Enforcement Act”, the first in 1990 (“BEA 1990“) and the second in 1997 (“BEA 1997“), the Joint Explanatory Statement of Managers of the Committee of Conference included a list of those programs that were to be considered “Appropriated Entitlements”.
Appropriated Entitlements and Mandatories for Fiscal Year 1991
U.S. House of Representatives, Omnibus Budget Reconciliation Act of 1990: Conference Report to Accompany H.R. 5835, House Report 101-964 (October 26, 1990), pp. 1176–1218.
Appropriated Entitlements and Mandatories for Fiscal Year 1997
U.S. House of Representatives, Balanced Budget Act of 1997: Conference Report to Accompany H.R. 2015, House Report 105-217 (July 30, 1997), pp. 1014–1053.
Previous:Apportionment |
Next:Appropriated Mandatory |
Budget Counsel 