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1974 Congressional Budget and Impoundment Control Act

SUMMARY:

The 1974 Congressional Budget and Impoundment Control Act modified the role of Congress in the federal budgetary process. It created standing budget committees in both the House and the Senate, established the Congressional Budget Office, and moved the beginning of the fiscal year from July 1 to October 1.

DESCRIPTION:

The 1974 Congressional Budget and Impoundment Act created a set of institutional changes designed to help Congress regain power over the budget process. The Act was inspired by Richard Nixon's refusal to disburse nearly $12 billion of congressionally-appropriated funds in 1973-74 through the executive power of impoundment, as well as more generalized fears about the budget deficit. Nixon claimed that the deficit was causing high inflation and that as a result he needed to curb government spending. To this effect, in the 1972 presidential election he called on Congress to grant the President authority to cut federal spending so as to keep the budget under control. Congress opposed Nixon's proposal and instead sought to reform Congress' budgetary role. In 1972 Congress created a Joint Study Committee on Budget Control which called for procedural reforms to enable Congress to examine the federal budget from an "overall point of view, together with a congressional system of deciding priorities." Following Nixon's impoundment Congress acted on these recommendations and in 1974 passed the Act over the President's veto.

The Act had two main goals: (1) strengthen and centralize Congress' budget authority; (2) reduce the President's impoundment authority. The latter was done by drafting detailed guidelines restricting how the President can impound funds already appropriated by Congress. The former—which has proven the more significant of the two—was done through a variety of means. The Act created the Congressional Budget Office (CBO) to give Congress independent economic analysis and end the Executive Branch's monopoly on budgetary information created by the 1921 Budget and Accounting Act. It created standing budget committees in both the House and the Senate, provided for greater numbers of staff for these and other committees involved in budget decisions, and made changes in the procedure of passing a budget. The new budget committee was required to pass a ‘concurrent budget resolution' (to be passed by Congress no later than May 15) outlining the government's overall expenditures and receipts, based on CBO estimates. The concurrent resolution would then serve as the blueprint for the regular work of the authorizing and appropriating committees as they drafted the budget.

The long-term effects of the Congressional Budget Act are in dispute. Iwan Morgan argues the Act shifted budgetary leadership to the Congress, which exacerbated the problems inherent in that institution by creating unrealistic deadlines and demanding a level of coordination of which Congress is incapable.

FURTHER INFORMATION:

Text of the act: http://www.gpoaccess.gov/riddick/502-642.pdf

Joseph J. Hogan, "Ten Years After: The U.S. Congressional Budget and Impoundment Control Act of 1974," Public Administration 63:2 (June 1985): 133-149. http://onlinelibrary.wiley.com/doi/10.1111/j.1467-9299.1985.tb00896.x/abstract

Joint Committee on the Organization of Congress (1993), "The Congressional Budget and Impoundment Control Act of 1974," http://www.rules.house.gov/archives/jcoc2y.htm.

Mark S. Kamlet and David C. Mowery, "The First Decade of the Congressional Budget Act: Legislative Imitation and Adaptation in Budgeting," Policy Sciences 18:4 (1985): 313-334. http://www.springerlink.com/content/k111h64p130g6554/

Iwan Morgan, The Age of Deficits: Presidents and Unbalanced Budgets from Jimmy Carter to George W. Bush (University of Kansas, 2009), 3-6.

James P. Pfiffner, The President, the Budget, and Congress: Impoundment and the 1974 Budget Act. (Westview Press, 1979).

Joseph White and Aaron Wildavsky, The Deficit and the Public Interest: The Search for Responsible Budgeting in the 1980s (University of California, 1989), 11-17.

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