Budget Resolutions, Deeming Resolutions, and Reconciliation Bills

Congress has a three-tier legislative process: (1) authorizations controlled by 17 authorizing committees in the House and Senate, respectively; (2) annual appropriations and revenue-raising controlled by House and Senate Appropriations Committees and the two tax-writing committees; and (3) the newest tier—the congressional budget process—which focuses on broad fiscal priorities and the effects of total spending and revenues on the U.S. economy.

Under the 1974 Budget Act, the Congress establishes overall fiscal policy by adopting a Concurrent Resolution on the Budget (“budget resolution”).

The budget resolution is not a law; it is an internal congressional framework to guide the work of the appropriations, authorizing, and tax committees. It establishes, for the upcoming fiscal year, a spending ceiling and revenue floor, a total amount for discretionary appropriations and, in some years, the amount by which entitlement spending or tax revenues should be adjusted by a filibuster-proof budget reconciliation bill. In the last decade, Congress has several times chosen to enact statutory “Bipartisan Budget Agreements” instead of a budget resolution.

A frequent misconception about the congressional budget process is that the budget resolution contains program-by-program detail; it does not. The budget resolution establishes a non-statutory, internal congressional framework for total spending and revenues, committee spending allocations, and enforcement mechanisms, but does not set funding levels for any individual programs.

A second misconception is that the budget resolution is the product of negotiations with the President. The budget resolution is a “concurrent resolution” that Congress, alone, uses as an internal mechanism to guide subsequent congressional action on spending and revenue bills. As a concurrent resolution of the House and Senate, it is not presented to the President for signature.

The Senate and House Budget Committees – using the President’s Budget request, information from their hearings, “views and estimates” from other committees of Congress, and projections from the Congressional Budget Office – draft their respective versions of a “Concurrent Resolution on the Budget” (“Budget Resolution”) in a series of working meetings known as committee “mark-ups.”

The Budget Resolution does not become a law and therefore is not presented to the President for signature. Rather, it is a congressional blueprint to guide subsequent action on specific spending and revenue measures.

The budget resolution, as a blueprint to guide subsequent action on spending and revenue measures, includes the following:

1. Enforceable spending aggregates (new budget authority and outlays) and revenue floors for the upcoming budget year, and planning levels for at least the ensuing four fiscal years;
2. A nonbinding distribution of new budget authority and outlays for all covered years among the 20 spending categories known as budget functions;
3. On-budget deficit (or surplus) levels projected to result from the spending and revenue aggregates;
4. Outlays and revenues for the Social Security insurance trust funds, displayed separately because the trust funds are off-budget;
5. Administrative expenses for the U.S Postal Service (which is also off-budget);
6. Total public debt and debt-held-by-the-public levels estimated to result from the budget resolution’s spending, revenue, and deficit levels;
7. (In the Conference Report accompanying the budget resolution): Enforceable allocations of spending to each committee of the House and Senate, including a lump-sum to the House and Senate Appropriations Committees for all “discretionary” spending, and direct (mandatory) spending allocations to authorizing committees;
8. Optional: “budget reconciliation instructions” directing revenue-raising and authorizing committees to report legislation making programmatic changes that achieve specified dollar amounts of revenue, direct spending, or deficit changes to programs within their jurisdictions, for inclusion in a combined reconciliation bill;
9. Optional: “budget reconciliation instructions” to the House Ways & Means and Senate Finance Committees to report changes to the debt limit;
10. Optional: special procedures to enforce the budget resolution;
11. Optional: budget resolution “reserve funds”—sometimes called contingency funds—to permit the Budget Committees to make adjustments in budget resolution aggregates and committee allocations to accommodate legislation on a specified subject that meets certain conditions (usually deficit-neutrality);
12. Optional: non-binding declaratory statements usually in the form of “sense of the House,” “sense of the Senate,” or “sense of the Congress,” and
13. Optional: displays of Federal retirement trust fund balances.

In years when the House and Senate have not reached agreement on a Budget Resolution, the House and Senate have adopted “deeming resolutions” to serve in place of an annual budget resolution for the purposes of establishing enforceable budget levels for the upcoming fiscal year.

Current Budget Year

FY 2023 House Action:   no action
FY 2023 Senate Action:  no action
FY 2023 Conference Action:  no action

Budget Resolutions, Deeming Resolutions, Reserve Funds, and Reconciliation Bills

[1] Budget resolution conference report (S.Rept. 96-399) to accompany S.Con.Res. 36 was not adopted.