Savings in Mandatory Outlays in Selected Reconciliation Acts

Publication Date: September 2005

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Banking and finance

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Abstract:

The budget reconciliation process is an optional procedure that operates as an adjunct to the annual budget resolution process. During the past 25 years, Congress has sent the President 19 reconciliation measures; 16 were signed into law and three were vetoed. During the 1980s and 1990s, reconciliation legislation often reflected Congress's most significant efforts to reduce the deficit through changes in revenue and mandatory spending laws. In recent years, however, reconciliation has been used mainly to reduce revenues.

The FY2006 budget resolution, H.Con.Res. 95, includes reconciliation instructions affecting mandatory spending and revenues. For the first time since 1997, reconciliation is proposed to reduce mandatory spending (by $34.658 billion over five years). As background on past efforts in this regard, net mandatory spending reductions in five major reconciliation acts enacted or vetoed in the 1990s are briefly summarized.

Over a five-year period, according to the Congressional Budget Office, the Omnibus Budget Reconciliation Act of 1990 (P.L. 101-508) reduced mandatory outlays by an estimated $75 billion; the Omnibus Budget Reconciliation Act of 1993 (P.L. 10366) reduced mandatory outlays by an estimated $77 billion; and in 1997, the Balanced Budget Act (P.L. 105-33) and the Taxpayer Relief Act (P.L. 105-34) together reduced mandatory outlays by an estimated $107 billion. The Balanced Budget Act of 1995, which proposed mandatory outlay reductions of $249 billion, was vetoed by President Clinton. Net reductions in mandatory spending were a significant element in the deficit reduction achieved or proposed under each act.

This report will be updated as developments warrant.