The Balanced Budget and Emergency Deficit Control Act of 1985

Testimony was given concerning the Balanced Budget and Emergency Deficit Control Act of 1985, specifically the act's: (1) reporting procedures for 1986 and 1987; and (2) effects on government programs in 1986 and possible effects in 1987. GAO noted that there will be several uncertainties in the reporting procedures in 1987 which did not exist in 1986, because some appropriations will not be enacted prior to the reports and there will be no limit on the sequester total. GAO also noted that agencies were able to cope with the 1986 cuts with a minimum of disruption in services and benefits provided to the public, through procurement postponements, travel and training restrictions, hiring freezes, and employee furloughs. GAO believes that, in 1987, the effects of a second cycle of cutbacks could be more serious. Agency officials indicated that another round of cuts reducing budget levels 7 to 8 percent below the post-sequester 1986 levels would significantly affect agency programs. Some agencies would find it difficult to avoid furloughs or reductions-in-force. The decline in service levels would have the most impact in the safety, security, and fiscal areas that are already hard-pressed by work-load requirements.