The Budget Control Act of 2011 (BCA) amended the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA), which had expired in 2002, by reinstating limits on discretionary budget authority for 2012 through 2021. The failure of the Joint Select Committee on Deficit Reduction to propose, and the Congress to enact, deficit reduction legislation triggered steep reductions to discretionary spending for fiscal years 2013-2021 on top of the $1 trillion in reductions below the discretionary baseline enacted in the BCA. Working together, the Congress and the President reached agreement to restore part of the scheduled reductions in 2016 and 2017 in the Bipartisan Budget Act of 2015 (2015 BBA) – just as had been done in the Bipartisan Budget Act of 2013 (2013 BBA) for 2014 and 2015. Each of these partial restorations of the discretionary spending limits were paid for by other provisions that reduced the deficit.
To date, the Congress has taken no action to address the reductions to the discretionary spending limits scheduled for 2018-2021, and the procedures instituted by the BCA remain in place for those years. The limits are enforced by a sequestration of non-exempt discretionary budget authority that is ordered at the end of the current session of the Congress if enacted appropriations exceed the limits. This report discusses the current status of the limits and Office of Management and Budget (OMB) scoring of actions taken to date by each chamber of the Congress on discretionary spending bills relative to those limits.
Section 254 of BBEDCA requires OMB to issue a sequestration update report on August 20th of each year. This report provides OMB’s current estimates of the discretionary spending limits, including any updates to the limits since OMB issued the 2017 preview report on February 9, 2016 with the President’s 2017 Budget. This report also contains OMB’s scoring of pending appropriations legislation against those limits as of August 15, 2016. OMB makes no adjustments to either of the 2016 or 2017 caps at this time because there have been no events since the 2017 preview report was issued that would trigger any cap adjustment. The report does, however, list anticipated adjustments to the 2016 and 2017 limits based on requested amounts in the Administration’s pending supplemental for 2016 and the 2017 Budget.
As required, OMB’s estimates are based on the economic and technical assumptions used in the President’s 2017 Budget and cover the 12 annual appropriations bills for 2017 that have been reported, passed, or conferenced by the House or Senate. Pursuant to section 254(e) of BBEDCA, this report also contains OMB’s calculation of the 2017 preview estimate of the adjustment for disaster relief funding.
If the discretionary limits for 2017 remain unchanged, OMB’s estimates of House action to date for the 12 annual appropriations bills for 2017 show that a sequestration of approximately $17 million would be required in discretionary programs in the defense (or revised security) category and that a sequestration of approximately $775 million would be required in discretionary programs in the non-defense (or revised nonsecurity) category. OMB’s current estimates of Senate action to date for both of the defense and non-defense categories are within the respective limits. These estimates are summarized in Table 4 of this report.
