Congressional Budget and Impoundment Control Act of 1974

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The Congressional Budget and Impoundment Control Act of 1974 is a federal law that established the congressional budget process, shifting certain budget authority from the president to Congress. The law, in part, created congressional budget committees, the Congressional Budget Office, and the budget reconciliation process—a legislative process used to expedite consideration of spending, tax, and debt limit bills. President Richard Nixon (R) signed the law into effect on July 12, 1974.

Background

President Richard Nixon (R) on July 12, 1974, signed the Congressional Budget and Impoundment Control Act of 1974 into law to establish a congressional budget process. Sponsors of the bill argued the Budget and Accounting Act of 1921 "gave too much power to the president, at the expense of Congress."

The law was established with the following priorities:

“ The Congress declares that it is essential— (1) to assure effective congressional control over the budgetary process; (2) to provide for the congressional determination each year of the appropriate level of Federal revenues and expenditures; (3) to provide a system of impoundment control; (4) to establish national budget priorities; and (5) to provide for the furnishing of information by the executive branch in a manner that will assist the Congress in discharging its duties. ”

Significant changes that were established by the act included the creation of the Congressional Budget Office, congressional budget committees, and the budget reconciliation process.

Philip Joyce, a professor of public policy, wrote about the changes made to the reconciliation process since the enactment of the act in a 2024 report published by the Brookings Institute. Joyce argued, "Reconciliation started out as a relatively minor part of the budget process. The drafters of the Budget Act had established it as a practice to bring the laws anticipated to be changed by the second budget resolution (scheduled to be considered in September) in line with actions that had already been taken in response to the first (April) budget resolution. ... There have been changes to the reconciliation process since its enactment that have substantially changed its operation and impact on the process. These include the timing of the reconciliation process, the scope of permissible reconciliation actions (specifically the so-called 'Byrd rule'), the scope of reconciliation, including its effects on federal debt and deficits, and its frequent use by Senate majorities to consider legislation without fear of a filibuster." Click here to learn more about the process of budget reconciliation.

Provisions

The Congressional Budget and Impoundment Control Act of 1974 included several provisions to improve fiscal procedures, change the fiscal year to begin on October 1, and amend the Budget and Accounting Act of 1921 and the Legislative Reorganization Act of 1946. The following sections include a selection of major provisions of the act:

Establishment of congressional budget committees and Congressional Budget Office

Titles I and II of the act established budget committees in the U.S. House of Representatives and the U.S. Senate and the Congressional Budget Office. The provisions direct the Congressional Budget Office to assist committees, including the budget committees, in the following ways:

“ (a) ASSISTANCE TO BUDET COMMITTEES.—It shall be the duty and function of the Office to provide to the Committees on the Budget of both Houses information which will assist such committees in the discharge of all matters within their jurisdictions, including (1) information with respect to the budget, appropriation bills, and other bills authorizing or providing budget authority or tax expenditures, (2) information with respect to revenues, receipts, estimated future revenues and receipts, and changing revenue conditions, and (3) such related information as such Committees may request. (b) ASSISTANCE TO COMMITTEES ON APPROPRIATIONS, WAYS AND MEANS, AND FINANCE.—At the request of the Committee on Appropriations of either House, the Committee on Ways and Means of the House of Representatives, or the Committee on Finance of the Senate, the Office shall provide to such Committee any information which will assist it in the discharge of matters within its jurisdiction, including information described in clauses (l) and (2) of subsection (a) and such related information as the Committee may request. (c) ASSISTANCE TO OTHER COMMITTEES AND MEMBERS.—(1) At the request of any other committee of the House of Representatives or the Senate or any joint committee of the Congress, the Office shall provide to such committee or joint committee any information compiled in carrying out clauses (1) and (2) of subsection (a), and, to the extent practicable, such additional information related to the foregoing as may be requested. (2) At the request of any Member of the House or Senate, the Office shall provide to such Member any information compiled in carrying out clauses (1) and (2) of subsection (a), and, to the extent available, such additional information related to the foregoing as may be requested. ”

The congressional budget process and reconciliation

See also: Budget reconciliation in the United States Congress, Uses of budget reconciliation in Congress

Title III of the act established the procedures governing Congress' budget adoption. This process includes adopting a budget resolution to set fiscal policy and spending limits. The provisions also establish the process of budget reconciliation, which can be used to expedite consideration of legislation changing the federal debt limit, revenue, or spending.

“ (c) RECONCILIATION PROCESS.—If a concurrent resolution is agreed to in accordance with subsection (a) containing directions to one or more committees to determine and recommend changes in laws, bills, or resolutions, and— (1) only one committee of the House or the Senate is directed to determine and recommend changes, that committee shall promptly make such determination and recommendations and report to its House a reconciliation bill or reconciliation resolution, or both, containing such recommendations; or (2) more than one committee of the House or the Senate is directed to determine and recommend changes, each such committee so directed shall promptly make such determination and recommendations, whether such changes are to be contained in a reconciliation bill or reconciliation resolution, and submit such recommendations to the Committee on the Budget of its House, which upon receiving all such recommendations, shall report to its House a reconciliation bill or reconciliation resolution, or both, carrying out all such recommendations without any substantive revision. For purposes of this subsection, a reconciliation resolution is a concurrent resolution directing the Clerk of the House of Representatives or the Secretary of the Senate, as the case may be, to make specified changes in bills and resolutions which have not been enrolled. (d) COMPLETION OF RECONCILIATION PROCESS.—Congress shall complete action on any reconciliation bill or reconciliation resolution reported under subsection (c) not later than September 25 of each year. (e) PROCEDURE IN THE SENATE.— (1) Except as provided in paragraph (2), the provisions of section 305 for the consideration in the Senate of concurrent resolutions on the budget and conference reports thereon shall also apply to the consideration in the Senate of reconciliation bills and reconciliation resolutions reported under subsection (c) and conference reports thereon. (2) Debate in the Senate on any reconciliation bill or resolution reported under subsection (c), and all amendments thereto and debatable motions and appeals in connection therewith, shall be limited to not more than 20 hours. (f) CONGRESS MAY NOT ADJOURN UNTIL ACTION IS COMPLETED.—It shall not be in order in either the House of Representatives or the Senate to consider any resolution providing fo the adjournment sine die of either House unless action has been completed on the concurrent resolution on the budget required to be reported under subsection (a) for the fiscal year beginning on October 1 of such year, and, if a reconciliation bill or resolution, or both, is required ot be reported under subsection (c) for such fiscal year unless the Congress has completed action on that bill or resolution, or both. ”

Impoundment control

Title X, referred to as the Impoundment Control Act, established a process for the president to request the rescission of appropriated funds by Congress:

“ Whenever the President determines that all or part of any budget authority will not be required to carry out the full objectives or scope of programs for which it is provided or that such budget authority should be rescinded for fiscal policy or other reasons including the termination of authorized projects or activities for which budget authority has been provided, or whenever all or part of budget authority provided for only one fiscal year is to be reserved from obligation for such fiscal year, the President shall transmit to both Houses of Congress a special message specifying— (1) the amount of budget authority which he proposes to be rescinded or which is to be so reserved ; (2) any account, department, or establishment of the Government to which such budget authority is available for obligation, and the specific project or governmental functions involved; (3) the reasons why the budget authority should be rescinded or is to be so reserved; (4) to the maximum extent practicable, the estimated fiscal, economic, and budgetary effect of the proposed rescission or of the reservation; and (5) all facts, circumstances, and considerations relating to or bearing upon the proposed rescission or the reservation and the decision to effect the proposed rescission or the reservation, and to the maximum extent practicable, the estimated effect of the proposed rescission or the reservation upon the objects, purposes, and programs for which the budget authority is provided. (b) REQUIREMENT TO MAKE AVAILABLE FOR OBLIGATION.—Any amount of budget authority proposed to be rescinded or that is to be reserved as set forth in such special message shall be made available for obligation unless, within the prescribed 45-day period, the Congress has completed action on a rescission bill rescinding all or part of the amount proposed to be rescinded or that is to be reserved. ”

See also

Reconciliation process and details:

• Budget reconciliation in U.S. Congress
• Filibuster and reconciliation in the United States Congress
• The Byrd Rule
• Senate Parliamentarian

Reconciliation origin, historical use, and analysis:

• Uses of budget reconciliation in Congress
• Congressional Budget and Impoundment Control Act of 1974
• Vote-a-ramas in the U.S. Senate
• What happens during Donald Trump's presidential transition process, 2024-2025
• Donald Trump presidential transition, 2024-2025

External links

• Congressional Research Services, "The Budget Reconciliation Process: Timing of Legislative Action," accessed December 23, 2024
• Congressional Research Service, "The Budget Reconciliation Process: The Senate’s 'Byrd Rule.'"
• Center on Budget and Policy Priorities, "Introduction to Budget “Reconciliation”, May 6, 2022
• Committee for Responsible Federal Budget, "Reconciliation 101," November 18, 2024
• Brownstein, "Reconciliation 101 and What It Means for 2025," November 13, 2024
• The Center for Children & Families (CCF) at the McCourt School of Public Policy at Georgetown University, "The Budget Resolution and Reconciliation Process Explained," December 11, 2024
• Reuters, "Explainer: How Republicans plan to pass Trump's agenda through 'reconciliation'," December 16, 2024
• Tax Foundation, "Questions About Tax Cuts, Tariffs, and Reconciliation After the Election," November 13, 2024