Budget Issues

This report assesses compliance by the Office of Management and Budget (OMB) and the Congressional Budget Office (CBO) with the requirements of the Balanced Budget and Emergency Deficit Control Act of 1985, more commonly known as Gramm-Rudman-Hollings. GAO reviewed OMB and CBO reports issued under the act to determine if they complied with all of the act's requirements. This report determines if the reports reflected all of the technical requirements specified by Gramm-Rudman-Hollings, such as (1) estimates of the discretionary spending limits, (2) explanations of any adjustments to the limits, (3) estimates of the amount of net deficit increase or decrease, and (4) the sequestration percentages necessary to achieve the required reduction in the event of a sequester.

GAO noted that: (1) overall, CBO and OMB substantially complied with the act; (2) although CBO met its deadlines, OMB issued both sequestration update report and a number of its required scorekeeping reports later than the law requires; (3) Gramm-Rudman-Hollings sets a specific timetable for issuance of OMB reports; (4) by law, OMB must issue sequestration reports at three specific times of the calendar year: (a) when the President submits his budget; (b) on August 20; and (c) 15 days after the congressional session; (5) instead of issuing its fiscal year 1998 sequestration update report on August 20 as required by law, OMB issued it on September 5, 1997, as part of the mid-session review on the fiscal year 1998 budget; (6) this was 16 days later than the law requires; (7) also, as was the case for fiscal year 1997 compliance, OMB issued many of its scorekeeping reports late; (8) all of its scorekeeping reports on individual appropriation acts and many of its pay-as-you-go (PAYG0) scorekeeping reports were issued later than the time specified in law; (9) of the 34 scorekeeping reports OMB issued by the time it issued its final sequestration report on November 24, about 40 percent of the reports were late; (10) this year, under the 7-day criterion, the 27 most recent scorekeeping reports issued after OMB issued its final sequestration report have averaged 12.6 work days between enactment and report issuance, making the reports, on average, 5.6 work days late; and (11) GAO also found some implementation issues related to OMB and CBO differences in: (a) scorekeeping for the open season for switching to the Federal Employees' Retirement System; (b) cap adjustments; (c) appropriations scoring; and (d) PAYGO estimates for the airport and airway tax reinstatement.