United States budget process
The Federal government of the United States uses a budget process to create the United States federal budget. The framework is used by Congress and the President of the United States to formulate the budget and was established by the Budget and Accounting Act of 1921,[dead link] the Congressional Budget and Impoundment Control Act of 1974, and by other budget legislation.
Prior to 1974, Congress had no formal process for establishing a coherent budget. When newly-elected President Richard Nixon began to refuse to spend funds that the Congress had allocated, Congress adopted a more formal means by which to challenge him. The Congressional Budget Act of 1974 created the Congressional Budget Office (CBO) and directed more control of the budget to it and away from the President's Office of Management and Budget (OMB). The Act passed easily while the administration was embroiled in the Watergate scandal and unwilling to provoke Congress.
The President, in accordance with to the Budget and Accounting Act of 1921, must submit a budget to Congress each year
. In its current form, federal budget legislation law (31 U.S.C. 1105(a)) specifies that the President submit a budget between the first Monday in January and the first Monday in February
. In recent times, the President's budget submission, entitled Budget of the U.S. Government, has been issued in the first week of February. Thus, President George W. Bush submitted the FY2007 budget in February 2006. The President's budget submission, along with supporting documents and historical budget data, can be found at the Office of Management and Budget's (OMB) website. The President's budget contains detailed information on spending and revenue proposals, along with policy proposals and initiatives with significant budgetary implications.
Each year in March, the Congressional Budget Office (CBO) publishes an analysis of the President's budget proposals. CBO budget report and other publications can be found at the CBO's website. CBO computes a current-law baseline budget projection that is intended to estimate what federal spending and revenues would be in the absence of new legislation for the current fiscal year and for the coming ten fiscal years. However, the CBO also computes a current-policy baseline, which makes assumptions about, for instance, votes on tax cut sunset provisions. The current CBO 10 year budget baseline projection grows from $3.7 trillion in 2011 to $5.7 trillion in 2021.
The House and Senate Budget Committees begin consideration of the President's budget proposals in February and March. Other committees with budgetary responsibilities submit requests and estimates to the Budget committees during this time. The Budget committees each submit a budget resolution by April 1. The House and Senate each consider those budget resolutions and are expected to pass them, possibly with amendments, by April 15. Budget resolutions specify funding levels for appropriations committees and subcommittees.
Appropriations committees, starting with allocations in the budget resolution, put together appropriations bills, which may be considered in the House after May 15. Once appropriations committees pass their bills, they are considered by the House and Senate. A conference committee is typically required to resolve differences between House and Senate bills. Once a conference bill has passed both chambers of Congress, it is sent to the President, who may sign the bill or veto. If he signs, the bill becomes law. Otherwise, Congress must pass another bill to avoid a shutdown of at least part of the federal government.
In recent years, Congress has not passed all of the appropriations bills before the start of the fiscal year. Congress has then enacted continuing resolutions, that provide for the temporary funding of government operations.