“Say what?” Breaking down federal budget terms

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Are your dinner guests using a lot of wonky words? Here’s a breakdown of words you’re likely to hear as the budget process moves forward this summer and what they mean.

Budget Resolution: this is a bill passed by the House and Senate that indicates the amount Congress intends to spend – by spending category – and how much revenue the government will collect for the next five or so years. This is a bill passed by a simple majority in each body.

Continuing Resolution (CR): this is a “stop gap” bill to keep federal agencies and/or programs funded for a specified amount of time, up to a full year, in the situation where Congress and the President have not passed an appropriations bill by the start of the next fiscal year (October 1 for FY18). It is enacted in the form of a joint resolution, passed by both houses of Congress and signed into law by the President. If a CR is not passed, and there is no new appropriations law, or the President doesn’t sign it, programs and agencies impacted shut down.

Deeming: an informal term that refers to resolutions that provide new spending allocations to the appropriations committees. But, they also may set new aggregate budget levels, provide revised spending allocations to other House and Senate committees, or provide for other related purposes.

Discretionary Programs or Spending: this refers to appropriations or programs that must be approved or renewed every year. This includes defense, environmental protection, education, border security, science research, transportation, and much more.

Mandatory Programs: also known as entitlements (such as Supplemental Nutrition Assistance Program or SNAP and Medicaid), funding for these programs do not need to be renewed annually and are available to those who qualify.

Omnibus Appropriations Bill: a large bill that bundles together smaller appropriations bills covering many spending areas and diverse issues. Instead of voting on bills by each spending category, through an omnibus appropriations bill, each chamber is able to vote on the whole package.

Reconciliation: a process used to facilitate the passage of legislation to amend tax or entitlement law that is filibuster proof and only requires 50 votes in the Senate, instead of 60.

Sequestration: a process that automatically cuts spending or establishes spending caps if no legislation is passed to meet a specific deficit-reduction target. The Budget Control Act of 2011 lays out this process, which was utilized in 2012 which led to equal cuts in defense and non-defense programs. 

We’ll keep adding to this list as we learn new words! If you want to dive deeper into these and other terms, check out the GAO’s Glossary of Terms Used in the Federal Budget Process.