The Budget Process Today
The current budget process is an amalgamation of precedents, procedures, and reforms adopted over the past two centuries. It has a strict timeline that Congress and the president are supposed to meet (although that's not usually the case). The following are descriptions of the most important dates.
The Process Begins in the Spring
It takes upward of eight months for the White House to prepare its budget. Because the president is required to submit his budget to Congress prior to the first Monday in February, the budget-writing process must begin the previous spring.
At that time, the president sends budget guidelines to each executive agency and department. The agencies formulate a budget according to the president's directive, and submit it to the Office of Management and Budget for review. This process is usually completed by the end of the year.
First Monday in February
Once the budget is ready, the president has about a month to formally submit it to Congress on the first Monday in February. Once there, the Congressional Budget Office reviews the budget and provides an economic report to the House and Senate budget committees.
The House and Senate budget committees have until March 15 to develop their own budget estimates. The committees are not bound to follow the president's recommendations.
To create concurrent budget resolutions, the committees hold hearings at which representatives from the federal agencies and the OMB testify before the committees to defend their budgets.
Congress is required to adopt a budget resolution by April 15. This resolution does not have the effect of law, nor does it provide specific details on how federal funds are to be spent. The budget resolution simply establishes a framework for Congress to formulate spending and revenue targets. It's not unusual for Congress to fail to pass a budget resolution.
Even if the budget resolution has not been passed, the House and Senate appropriations committees begin working on the thirteen regular appropriations bills that make up the budget. The bills are assigned to thirteen permanent subcommittees, which conduct hearings at which agency officials can defend their budget requests. The 13 regular appropriations bills that must be passed each year are:
Agriculture and Food & Drug Administration
Departments of Commerce, Justice, and State
Department of Defense
District of Columbia
Energy and Water Development
Department of Interior
Departments of Labor, Health and Human Services, and Education
Department of Transportation
Treasury and Postal Department
Departments of Housing and Urban Development and the Veterans Administration
June or August
Once the subcommittees have completed their work, the entire Appropriations Committee votes on the measure. If it passes the Appropriations Committee, the bill goes to the House and Senate floors for a final vote. A conference committee irons out any differences between the House and Senate version. Both chambers must pass the conference committee bill before it can be sent to the president for his signature. This is usually one of the most contentious moments of the budget process.
The federal government's fiscal year begins on October 1. If the budget is not enacted by this time (which is almost every year), continuing appropriations must be passed in order to keep the federal government running. These have become a very common practice in Washington. In 1995, Congress and the president twice failed to agree on continuing appropriations, which led to the temporary shutdown of the federal government.