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Final Sequestration Report for Fiscal Year 2017 1 (May 12, 2017)

handle is hein.congrec/cbo3513 and id is 1 raw text is: Final Sequestration Report for Fiscal Year 2017 In general, after a session of Congress ends, the Congressional Budget Office is required to issue a report that provides estimates of the limits (often called caps) on discretionary budget authority that are in effect for each fiscal year through 2021.1 As part of that requirement, CBO also must report whether, according to its estimates, enacted legislation for the current fiscal year has exceeded those caps. If so, a sequestration (that is, a cancellation of budgetary resources) would be required. Normally, CBO's final sequestration report would be issued 10 days after the end of a session of Congress. This year, however, because appropriations for fiscal year 2017 had not been finalized when the 114th Congress ended on January 3, 2017, the deadline was extended to 10 days after 2017 appropriations were enacted. Those final appropriations were enacted in the Consolidated Appropriations Act, 2017 (Public Law 115-3 1), which was signed into law on May 5. In CBO's estimation, a sequestration will not be required for 2017. However, the authority to determine whether a sequestration is required and, if so, exactly how to make the necessary cuts in budget authority rests with the Administration's Office of Management and Budget (OMB). Those determinations are based on OMB's own estimates of federal spending. 1. Budget authority is the authority provided by law to incur financial obligations that will result in immediate or future outlays of federal 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 and are designated by the calendar year in which they end. Limits on Discretionary Budget Authority for 2017 The Bipartisan Budget Act of 2015 (P.L. 114-74) modified the caps on defense and nondefense funding for fiscal year 2017 that were established by the Budget Control Act of 2011 (P.L. 112-25). P.L. 114-74 reset those limits to total $1,069.6 billion-$551.1 billion for defense programs and $518.5 billion for nondefense programs. By law, however, the caps are adjusted upward when appropriations are provided for certain purposes. Specif- ically, budget authority that is designated as an emer- gency requirement or provided for overseas contingency operations, such as military activities in Afghanistan, leads to an increase in the caps, as does budget authority provided for some types of disaster relief (as explained below) or for certain program integrity initiatives.2 To date, CBO estimates, such adjustments to the caps on discretionary budget authority for 2017 have totaled $118.0 billion (see Table 1). Most of that amount, $82.9 billion, is an increase in the defense cap to account for budget authority provided for overseas contingency operations. Estimated adjustments to the nondefense cap include $20.8 billion for overseas contingency operations, $8.1 billion for disaster relief, $4.1 billion for emergency funding for natural disaster preparedness, and $2.0 billion for program integrity initiatives related to Medicare and to the Disability Insurance and Supple- mental Security Income programs. 2. Such initiatives may be aimed at reducing improper benefit payments in the Disability Insurance and Supplemental Security Income programs, Medicare, Medicaid, and the Children's Health Insurance Program.

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