The Congressional Appropriations Process Explained

July 10, 2020 by Dan McCue
U.S. Capitol, June 30, 2020. (Photo by Dan McCue)

WASHINGTON – When House Majority Leader Steny Hoyer explains the congressional appropriations process, it all sounds so simple.

“Funding the government is the Constitutional responsibility of the Congress,” he told The Well News recently, in a statement for this article.

“House Democrats are committed to meeting that responsibility and getting our work done on time for the people,” he said.

He explained, “The Appropriations Committee is hard at work preparing an appropriations bill for consideration on the House floor.”

“It’s my intention to pass as many of them through the House as possible before the end of the month,” he added.

In order to do that, some of the 12 appropriations bills will be packaged into so-called “minibuses,” consistent with what the Democrats did last year and what Republicans did in the previous Congress.

In fact, in 2019, the House Democrats did something that hadn’t been done in 13 years – passing 10 appropriations bills before the end of June, providing funding for 96% of the federal government.

This year, Hoyer said, “The House is doing its work to avoid another Trump shut down and to ensure the government is responsibly funded before Sept. 30, the end of the fiscal year.”

“I hope Republicans work with us to send bipartisan bills to the Senate, and I strongly urge [Senate Majority Leader Mitch] McConnell to get to work on the appropriations process in the Senate,” he said.

“We must provide the country with certainty and not face the threat of another shutdown because of the Senate’s unwillingness to get its work done,” he concluded.

House Holds The Purse Strings

With a few notable exceptions, and despite whatever controversy may be raging at the time, most lawmakers on Capitol Hill see money-related bills as must-pass legislation.

These include the 12 general appropriations bills, the National Defense Authorization Act, measures raising the national debt ceiling, and legislation such as that passed this spring to address the coronavirus outbreak.

Why do they take these bills so seriously?

It all begins with Article I of the Constitution which says only Congress is empowered to collect taxes, borrow money and authorize expenditures.

Even the Executive Branch, for all its power, can spend money only for the purposes and in the amounts specified by Congress.

Still unconvinced? Then take a look at Article I § 9.

“No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law,” it states.

Why did the framers of the Constitution place the power of the purse so firmly in Congressional hands? It all comes down to the founders’ idea that Congress is the branch closest to the people.

Writing in Federalist No. 58 in February 1788, future President James Madison wrote “The power of the purse may, in fact, be regarded as the most complete and effectual weapon with which any constitution can arm the immediate representatives of the people, for obtaining a redress of every grievance, and for carrying into effect every just and salutary measure.”

Sharp-eyed readers may well be asking right now why, if the power of the purse is invested in Congress, the president prepares a lengthy budget proposal every year?

The short answer is time marches on. As new challenges buffeted the Constitutional framework, changes were made to meet the unimagined demands of the future.

In 1921, for instance, through its passage of the Budget Accounting Act, Congress delegated to the president the statutory responsibility for preparing a comprehensive federal budget each year.

The landmark legislation not only established the framework for the modern federal budget process, it also mandated an independent audit of government accounts through the Bureau of the Budget, now called the Office of Management and Budget.

Since then, presidents have embraced this responsibility, using it to highlight their priorities and frame the budgetary debate to follow.

Congress, of course, is not bound to these recommendations, but they are considered the starting point of the annual appropriations discussion.

The president still has the ability to influence the outcome — for instance, through the use of his constitutional veto power.

The resulting appropriations bills then — 12 in total — reflect the choices of both the Executive and Legislative branches among competing national priorities. In that sense, the resulting budget is a hybrid; a lengthy fiscal document, and at the same time, a political declaration.

The President’s Budget Goes to Congress

The annual appropriations cycle is initiated with the president’s budget submission, which is due on the first Monday in February.

In this submission, the president will recommend spending levels for various programs and agencies of the federal government in the form of “budget authority.”

This budget authority does not represent actual money provided to or reserved for agencies. Instead, the term refers to authority provided by federal law to enter into contracts or other financial obligations that will result in immediate or future outlays from the federal Treasury.

After the president submits the budget proposal to Congress, each agency generally provides additional detailed justification materials to the House and Senate appropriations subcommittees with jurisdiction over its funding.

The hearings may also be supplemented by meetings and communications between the subcommittee staff and agency officials. At the same time, the subcommittees may solicit requests from members of Congress for programmatic levels and language to be included in the appropriations bills and committee reports.

Most years the president’s submission is followed by congressional consideration of a budget resolution that, in part, sets spending ceilings for the upcoming fiscal year. However, there is no penalty for not passing a budget resolution and some Congresses forego this step – though they do so at the peril of House leaders getting an earful from the fiscal hawks in their ranks.

So let’s look again at those 12 regular appropriations bills.

Much of the federal government is funded through the annual enactment of 12 regular appropriations bills — a practice followed since the very first Congress.

These appropriations fall into three main categories: annual, supplemental (think emergency funding after a natural disaster or pandemic) and continuing (the stopgap funding that keeps agencies going if they don’t receive an annual appropriation by the start of the new fiscal year on Oct. 1.)

These so-called “CRs” provide Congress with additional time to resolve funding differences between the two parties and among the House, Senate, and White House.

Despite the scope of what each of the appropriations bill covers, the truth is roughly two-thirds of federal expenditures are mandatory — obligations to spend money to support or advance laws previously enacted by Congress.

Among the items that fall into this well of mandatory spending are entitlements like Social Security and Medicare, and interest payments on the federal debt.

What’s more, because many of these items are indexed to the cost of living, the spending on them increases each year. Much of this is the product of good intentions — creating stability and a sense of certainty for those who benefit from these expenditures.

But what it means is that combined, the 12 appropriations bills account for just 35% to 39% of total federal spending, according to the Congressional Research Service.

Timetable for Consideration of Appropriations

Traditionally, the House initiates consideration of regular appropriations measures, and the Senate subsequently considers and amends the House-passed bills.

More recently, the Senate sometimes has not waited for the House bills; instead they have reported original Senate bills.

Under this more recent approach, the House and Senate appropriations committees and their subcommittees have often considered the regular bills simultaneously.

The House Appropriations Committee reports the 12 regular appropriations bills separately to the full House, typically by late May or June. Consideration by the full House follows.

The Senate Appropriations Committee typically begins reporting the bills in June and generally completes committee consideration prior to the August recess. The Senate typically begins floor consideration of the bills beginning in June or July.

Consideration by the full House and Senate may continue through the fall.

While Congress has traditionally considered and approved each regular appropriations bill separately, delays in their consideration may mean that one or more appropriations measures may not receive separate initial consideration in one or both chambers and that several appropriations bills may subsequently get combined into a single legislative vehicle prior to enactment — referred to as omnibus appropriations measures.

Larger omnibus bills are often a point of controversy because they are usually assembled by a small group comprised of the chamber’s party leadership and committee chairs, leaving rank and file members to feel voiceless in the process and angry because they often have little time to review these massive measures.

In recent years leaders have chosen to package a smaller number of appropriations bills together as “minibus” measures to make them more palatable and therefore more likely to pass.

Work of the Appropriations Committees

The House and Senate Committees on Appropriations have jurisdiction over the annual appropriations measures.

Each committee is organized into subcommittees, with each subcommittee having responsibility for developing one regular annual appropriations bill to provide funding for departments and activities within its jurisdiction.

Each House appropriations subcommittee is paired with a Senate appropriations subcommittee and the two subcommittees’ jurisdictions are generally identical.

After conducting the initial round of subcommittee hearings, the House and Senate Appropriations Committees make their sub-allocations, and the subcommittees begin to draft, mark up, and report the regular bills under their jurisdiction to their respective full committees.

Both Appropriations Committees consider each subcommittee’s recommendations separately. The committees may adopt amendments to a subcommittee’s recommendations prior to reporting the bills and making them available for further consideration by their respective chambers.

Prior to floor consideration of an appropriations bill, the House almost always considers a special rule reported by the House Rules Committee setting parameters for floor consideration of the bill.

If the House adopts the special rule, it usually considers the appropriations bill soon thereafter.

The House considers the bill in the Committee of the Whole House on the State of the Union, of which all Representatives are members.

A special rule on an appropriations bill usually provides for one hour of general debate on the bill. The debate includes opening statements by the chair and ranking minority member of the appropriations subcommittee with jurisdiction over the regular bill, as well as other interested representatives.

After the Committee of the Whole debates the bill, it considers amendments. The appropriations bill is generally read for amendment, by paragraph.

Amendments to general appropriations bills are governed by a series of requirements:

  • House standing rules and precedents that establish several requirements applicable to all types of measures, such as requiring amendments to be germane to the bill;
  • House standing rules and precedents that establish a separation between appropriations and other legislation;
  • Separate orders establishing certain requirements, such as those requiring a “spending reduction account” section in each regular appropriations bill and limiting permissible amendments;
  • Spending limits imposed by the congressional budget process; and
  • Provisions of a special rule or unanimous consent agreement providing for consideration of a particular appropriations bill.

House and Senate Conference Action

The Constitution requires that the House and Senate approve the same measure in precisely the same form before it may be presented to the president for his signature or veto.

Consequently, once the House and Senate have both completed initial consideration of an appropriations measure, the Appropriations Committees in each chamber will try to negotiate a resolution of the differences between their respective versions.

In current practice, the Senate typically passes the House bill with the Senate version attached as a single substitute amendment. As a result, the House and Senate resolve their differences based on disagreement on the measure as a whole.

If the House comes to believe the Senate has overstepped and in effect, trespassed on its revenue-initiating authority, it will subject the offending measure to a “blue-slip” rejection — notification to the Senate — on blue paper — that it has impinged upon the exclusive privilege of the House.

Members of the House and Senate appropriations subcommittees having jurisdiction over a particular regular appropriations bill, as well as the chair and ranking minority members of the full committees, are designated as conferees or managers and tasked with meeting to negotiate over differences between the House- and Senate-passed versions.

The purpose of the negotiations is to resolve differences between the two chambers, and therefore House and Senate rules generally require conferees to negotiate within the scope of the differences on those matters in disagreement.

Completion of the conference report is not on a specified timeline, so negotiations are concluded only when a majority of the conferees from each chamber sign the conference report.

Once conferees reach agreement on all points of difference, they offer the conference report, which proposes a new conference substitute for the bill as a whole. In addition, the conference report includes a joint explanatory statement (or managers’ statement) explaining the new substitute. A conference report may not be amended in either chamber.

Usually, the House considers conference reports on appropriations measures first. The first chamber to consider the conference report may vote to adopt it, reject it, or recommit it to the conference for further consideration. After the first house adopts the conference report, the conference is automatically disbanded; therefore, the second house has two options—to adopt or reject the conference report. In cases in which the conference report is either rejected or recommitted to the conference committee, the two chambers may negotiate further over the matters in dispute.

The measure cannot be sent to the president until both houses have agreed to the entire text of the bill.

The rules governing the content of the conference report may be enforced or waived during House and Senate consideration of it.

Prior to consideration of the conference report, the House typically adopts a special rule waiving all points of order against the conference report or its consideration.

In the Senate, such points of order may be waived through unanimous consent or (in some cases) motions to waive. If a point of order is sustained, the conference report falls.

A mechanism is available, however, through which new matters or new directed spending provisions included in a conference report can be stricken while the remaining provisions are effectively retained for further Senate consideration. If the presiding officer sustains a point of order against new matters or one or more new directed spending provisions, the offending language is stricken from the conference report.

After all points of order under both requirements have been disposed of, the Senate considers a motion to send the remaining provisions to the House as an amendment between the houses since the changed legislative text can no longer be considered as a conference report. The House would then consider the amendment. The House may choose to further amend the Senate amendment and return it to the Senate for further consideration.

If the House, however, agrees to the amendment, the measure is cleared for presidential action. Alternatively, the Senate may choose to retain such provisions by voting to waive these points of order. To succeed, the motion must be adopted by a three-fifths vote of all Senators duly chosen and sworn. An appeal of a ruling by the presiding officer on one of these points of order would also require a vote of three-fifths of all Senators.

Presidential Action

Under the Constitution, after a measure is presented to the president, he has 10 days to sign or veto the measure. If he takes no action, the bill automatically becomes law at the end of the 10-day period if Congress is in session. Conversely, if he takes no action when Congress has adjourned, he may pocket veto the bill.

If the President vetoes the bill, he sends it back to Congress. Congress may override the veto by a two-thirds vote in both houses. If Congress successfully overrides the veto, the bill becomes law. If Congress is unsuccessful, the bill dies.

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