Summary

In GAO's opinion, the reports issued by the Office of Management and Budget (OMB) and the Congressional Budget Office (CBO) complied with the Budget Enforcement Act of 1990 except for OMB's inflation adjustment to the fiscal year 1993 discretionary spending limits. This was incomplete because it did not cover personnel costs. Since OMB's judgments are binding, the spending limit for discretionary budget authority was $2.5 billion higher than it should have been. GAO also discusses some implementation issues related to (1) classifying discretionary spending for domestic or defense programs, (2) distinguishing between discretionary and mandatory spending, and (3) making cost estimates. Categorizing spending by such criteria is difficult and subject to interpretation. OMB's and CBO's disagreement over how they classified parts of 16 programs illustrates the difficulties in the formula approaches to budgeting represented by the Budget Enforcement Act and Gramm-Rudman-Hollings before it. In addition, OMB's and CBO's cost estimates for three programs differ significantly because of varying technical and methodological assumptions.

GAO found that the: (1) OMB and CBO reports complied with the act; (2) OMB inflation adjustment to the fiscal year 1993 discretionary spending limits was incomplete since it did not include personnel costs; and (3) spending limit for discretionary budget authority was $2.5 billion higher than it should have been.