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Sequestration Update Report: August 2013 1 (August 2013)

handle is hein.congrec/cbo11213 and id is 1 raw text is: Sequestration Update Report: August 2013 By law, the Congressional Budget Office (CBO) is required to issue a report by August 15 of each year that provides estimates of the caps on discretionary budget authority in effect for each fiscal year through 2021.1 No additional appropriations or substantive changes to the caps have occurred since CBO's previous report on the topic, which was published in March 2013.2 Conse- quently, CBO continues to estimate that the discretion- ary appropriations provided for 2013 do not exceed the caps and thus that, through the end of July, a further sequestration (or cancellation of budgetary resources) will not be required as a result of appropriation actions this year. (The sequestration that was triggered by the auto- matic enforcement procedures of the Budget Control Act of 2011 remains in effect, however.) The Administration's Office of Management and Budget (OMB) has sole authority to determine whether a further sequestration is required; its sequestration report issued in April 2013 also found that appropriations for 2013 were at or below the caps.3 1. The Budget Control Act of 2011 (Public Law 112-25) amended the Balanced Budget and Emergency Deficit Control Act of 1985 to reinstate caps on discretionary budget authority through fiscal year 2021. Budget authority is the authority provided by law to incur financial obligations that will result in immediate or future outlays of federal government funds. Discretionary budget authority is provided and controlled by appropriation acts. All of the years referred to in this report are federal fiscal years, which run from October 1 to September 30. 2. See Congressional Budget Office, Final Sequestration Report for Fiscal Year 2013 (March 2013), wwwcbo.gov/publicatioi44021. 3. See Office of Management and Budget, OMB Final Sequestration Report to the President and Congress for Fiscal Year 2013 (April 2013), wv -whitehouse.gov/omb/legislativereportsi sequestration. Limits on Discretionary Budget Authority for 2013 The Budget Control Act of 2011 established separate caps on what it designated as security and nonsecurity budget authority, and the American Taxpayer Relief Act of 2012 modified those caps for fiscal year 2013.4 The security category comprises discretionary appropriations for the Departments of Defense, Homeland Security, and Veterans Affairs; the National Nuclear Security Administration; the intelligence community manage- ment account (Treasury account 95-0401-0-1-054); and discretionary accounts related to international affairs (budget function 150). The nonsecurity category comprises all other discretionary appropriations. Those caps on budget authority for 2013 are currently set at $1,043 billion-$684 billion for security programs and $359 billion for nonsecurity programs (see Table 1). Separately, automatic spending reductions triggered under the Budget Control Act went into effect on March 1, reducing discretionary funding (but not the caps) by $64 billion (including cuts to programs not subject to the caps), according to estimates from OMB. Under the law, the annual limits on funding are adjusted when appropriations are provided for certain purposes. Specifically, budget authority designated as an emergency requirement or provided for overseas contingency opera- tions (such as the war in Afghanistan) would lead to an increase in the caps, as would budget authority provided for some types of disaster relief (up to an amount based 4. The American Taxpayer Relief Act also reduced the caps on defense and nondefense funding for 2014 by $4 billion each.

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