Introduction

Under congressional budgetary enforcement rules, Congress can designate a provision as an emergency requirement by stating as such in the legislative text of that measure. These rules generally establish that the spending or revenue effects of provisions designated as an emergency requirement are exempt from applicable budget enforcement rules.

Emergency designations have procedural and budgetary significance in the congressional budget process. Current rules generally exempt the budgetary effect of provisions carrying emergency designations from enforcement mechanisms that may apply during their consideration or after enactment. These exemptions have two main practical effects. First, they allow Congress to enact emergency-designated spending or revenues even if doing so would otherwise violate budgetary enforcement rules. Second, the budgetary effects of such provisions do not count for the purposes of enforcing other, non-emergency provisions. In other words, the consideration and enactment of spending or revenues designated as an emergency requirement has no effect on the budgetary enforcement of other, non-emergency provisions.

This report covers the rules and procedures associated with emergency designations in the congressional budget process. First, it describes authorities in the House and Senate for making emergency designations and their effect with regard to each budgetary enforcement rule. Next, the report provides a history of emergency designations in the congressional budget process since Congress enacted the Budget Act in 1974.¹

Emergency Designation Rules and Procedures

Congress considers spending and revenue legislation under a set of enforcement procedures that are generally intended to provide greater control over spending, revenues, and the deficit. Under these rules, Congress can designate a measure, or certain provisions within a measure, as an emergency requirement simply by stating as such in the legislative text of that measure. In current practice, congressional budgetary rules preclude such provisions from enforcement either by establishing that the spending and revenue effects not count for the purposes of applicable enforcement mechanisms or by requiring adjustments to relevant budgetary levels to accommodate such spending. The following sections describe the rules and procedures (summarized in Table 1) related to the application of emergency designations in the congressional budget process.

Budget Act and Related Enforcement

The Budget Act created procedures that allow Congress to establish a fiscal framework for the consideration of budgetary legislation through the adoption of a concurrent resolution on the budget for each fiscal year (the budget resolution). The budget resolution serves as a congressional budget plan establishing, among other matters, spending, revenue, and deficit levels covering at least five fiscal years.² The Budget Act also established a process through which the total spending levels set forth in the budget resolution are allocated among all committees with jurisdiction over spending legislation (known as "302(a)" allocations). The House and Senate Appropriations committees are each required to subdivide their 302(a) allocations among their 12 subcommittees (known as "302(b)" suballocations).³

Congress enforces the budgetary levels associated with the budget resolution through points of order established in the Budget Act.⁴ Under the act, legislation may generally not cause total new budget authority to exceed—and total revenue to fall below—the levels established in the most recently adopted budget resolution.⁵ Budget Act points of order may also be raised against measures that would cause the total budget authority or outlays under a committee's jurisdiction to exceed its 302(a) allocation or the level of budget authority (and outlays in the Senate) in an appropriations bill to exceed the applicable appropriations subcommittee's 302(b) suballocation.⁶

Congress generally exempts provisions designated as emergency requirements from enforcement under the Budget Act. Historically, Congress has done this through authorities adopted in budget resolutions (or alternative legislative measures that trigger Budget Act enforcement, known as "deeming resolutions") as well as in statute.⁷ These authorities have generally established either that budgetary levels will be adjusted to accommodate the estimated budgetary effects of provisions designated as emergency requirements or that they not count for enforcing relevant Sections of the Budget Act. This includes those that enforce aggregate spending and revenue levels (Section 311) as well as 302(a) and 302(b) levels (Section 302).

For FY2024 and FY2025, discretionary appropriations designated as emergency requirements are exempt from enforcement under the Budget Act in the House and Senate pursuant to Section 314(a) of the act.⁸ This Section allows for adjustments to budgetary levels (including aggregates, 302(a) allocations, and 302(b) suballocations) to accommodate spending designated as an emergency requirement.⁹ The Budget Act establishes that these adjustments will

• apply while the legislation containing the emergency designation is under consideration,
• take effect upon its enactment, and
• be published in the Congressional Record as soon as practicable.¹⁰

This procedure effectively exempts discretionary appropriations designated as emergency requirements from Budget Act enforcement related to discretionary spending (i.e., aggregate spending levels, 302(a) allocations to the Appropriations Committees, and 302(b) suballocations).¹¹

Additionally, the Senate exempts provisions with emergency designations from Budget Act enforcement of all spending and revenue levels associated with the budget resolution. This authority was adopted through Section 4001(a) of the FY2022 budget resolution, which effectively exempts emergency-designated spending and revenues from Budget Act points of order enforcing committee spending allocations (Section 302) and aggregate spending levels (Section 311).¹²

This provision also exempts emergency-designated spending and revenues from other, Senate-specific budget enforcement rules, including the Senate's short-term deficit point of order, long-term deficit point of order, and PAYGO point of order.¹³

Statutory Discretionary Spending Limits

The Fiscal Responsibility Act of 2023 established statutory limits on discretionary spending for FY2024 and FY2025.¹⁴ These limits, which are divided into security (defense) and nonsecurity (nondefense) categories, serve as enforceable topline levels for discretionary spending in each category.¹⁵

The limits for FY2024 and FY2025 are enforceable through sequestration procedures under the Deficit Control Act. These procedures are the same or similar to those that enforced discretionary limits previously in place at various points over the past few decades. Under these procedures, if enacted discretionary appropriations in either category—defense or nondefense—exceed the applicable cap for that fiscal year, then the President is required to issue a sequestration order that implements an across-the-board reduction of budget authority for non-exempt accounts.¹⁶ These reductions would generally apply at a uniform percentage across non-exempt accounts within the category for which the caps have been exceeded at a level sufficient to eliminate the breach.¹⁷ Discretionary spending limits are also enforceable during the consideration of applicable bills through a point of order under Section 314(e) of the Budget Act that prohibits the consideration of measures that would cause the limits to be exceeded.¹⁸

The Deficit Control Act exempts provisions that Congress designates (and that the President subsequently designates) as emergency requirements from the enforcement of statutory discretionary spending limits. Section 251(b)(2)(A), in part, requires that discretionary spending caps be adjusted up to any amount to accommodate appropriations that Congress designates, on an account-by-account basis, as emergency requirements. When OMB submits its final sequestration report, it is required to calculate and include adjustments for the full amounts of appropriations that Congress designated as emergency requirements over the period the report is required to cover.¹⁹ These adjustments effectively establish that the budgetary effect of emergency-designated discretionary appropriations do not count in the final calculation of a potential breach of the discretionary spending limits. Discretionary appropriations designated as emergency requirements are not exempt from any potential sequester, however, unless they are within an exempted account.

In the Senate, a point of order may be raised against any emergency designation made pursuant to Section 251 of the Deficit Control Act.²⁰ Section 314(e) of the Budget Act establishes this point of order, stating

(e) SENATE POINT OF ORDER AGAINST AN EMERGENCY DESIGNATION. –

(1) IN GENERAL. – When the Senate is considering a bill, resolution, amendment, motion, amendment between the Houses, or conference report, if a point of order is made by a Senator against an emergency designation in that measure, that provision making such a designation shall be stricken from the measure and may not be offered as an amendment on the floor.

This point of order can be waived by a three-fifths vote from the Senate, which effectively requires that any emergency designation in a provision providing discretionary appropriations be supported by 60 Senators (assuming no more than one vacancy) for it to remain in a provision.²¹ If the waiver is not agreed to, the emergency designation is stricken from the measure and the budgetary effects of the provision in question are subject to applicable budgetary enforcement rules.

Statutory PAYGO

The Statutory Pay-As-You-Go (PAYGO) Act of 2010 established a process intended to encourage budget neutrality on new direct spending (also known as mandatory spending) and revenue legislation, generally requiring such "PAYGO" legislation not to increase the deficit.²²

Statutory PAYGO aims to enforce deficit levels through sequestration, which implements across-the-board cuts to non-exempt direct spending programs when its requirements are violated. The Statutory PAYGO Act requires the Office of Management and Budget (OMB) to maintain two PAYGO scorecards covering rolling five- and 10-year periods that record the budgetary effects of new direct spending and revenue provisions enacted into law.²³ Shortly after the end of a congressional session, OMB is required to finalize the two PAYGO scorecards. If a net increase in the deficit has been recorded for the budget year on either scorecard, then the President is required to issue a sequestration order to implement across-the-board cuts to non-exempt direct spending programs sufficient to remedy the deficit increase.²⁴

The Statutory PAYGO Act created an emergency designation for PAYGO legislation that exempts new direct spending and revenues resulting from provisions designated as emergency requirements from enforcement under the act. Specifically, Section 4(g)(4) of the act, as shown below, establishes that the budgetary effect of such provisions will not be counted on the PAYGO scorecards.

(4) EFFECT OF DESIGNATION ON SCORING. – If a provision is designated as an emergency requirement under this Act, CBO or OMB, as applicable shall not include the budgetary effects of such a provision in its estimate of the budgetary effects of that PAYGO legislation.

Section 4(g) of the Statutory PAYGO Act also established certain procedures related to making an emergency designation in legislation subject to PAYGO in the House and Senate. In the House, if a PAYGO bill contains an emergency designation, then the chair must put the question of consideration to the full House prior to its consideration.²⁵ That is, the House must vote on whether to consider the legislation even though it contains an emergency designation exempting all or certain budgetary effects from Statutory PAYGO. If the full House decides the question in the affirmative by a majority vote, then the legislation is considered. (Conversely, if a majority votes in the negative, then the legislation is not considered.) In the Senate, a Senator may raise a point of order against an emergency designation in a PAYGO bill.²⁶ This point of order may be waived by an affirmative vote of three-fifths of the Senate (60 Senators if there is no more than one vacancy). If the waiver motion is rejected, then the emergency designation is stricken, and the budgetary effects of the legislation, if enacted, would be added to the five- and 10-year PAYGO scorecards.

One example of legislation with an emergency designation being exempted from enforcement under Statutory PAYGO is the Emergency Repatriation Assistance for Returning Americans Act of 2021.²⁷ The act, which provided authority for increased payments under the Social Security Act for temporary assistance to U.S. citizens returned from foreign countries, contained an emergency designation exempting the resulting increase in direct spending from enforcement under Statutory PAYGO. Specifically, Section 2(b)(1) of the act states as follows:

(b) EMERGENCY DESIGNATION. –

(1) IN GENERAL. – The amounts provided by the amendment made by this section are designated as an emergency requirement pursuant to section 4(g) of the Statutory Pay-As-You-Go Act of 2010 (2 U.S.C. 933(g)).

As a result, pursuant to Section 4(g) of the Statutory PAYGO Act, the budgetary effect of P.L. 117-39 did not count for the purposes of Statutory PAYGO. OMB's 2021 Statutory Pay-As-You-Go Act Annual Report reflects this, conveying that the budgetary effect of P.L. 117-39 was not included in the final calculation of the OMB PAYGO scorecards for the purposes of determining a potential deficit increase. This is despite OMB estimating that the act would increase the deficit by $2 million over the five- and 10-year periods. Specifically, the report states, "The effects of the provisions in these laws that are designated as emergency requirements appear on the scorecard, but are subtracted before computing the scorecard totals."²⁸

House CUTGO and Senate PAYGO Rules

Over the years, the House and Senate have each adopted their own rules encouraging deficit neutrality on certain direct spending and revenue legislation. As with other budget enforcement mechanisms, these House and Senate rules also provide the authority to exempt the budgetary effects of provisions designated as emergency requirements.

House Cut-As-You-Go (CUTGO) Rule

The House has its own rule generally requiring budget neutrality for any legislation that is estimated to affect mandatory spending. A version of this rule (Clause 10 of House Rule XXI) has been adopted in various forms for each Congress since the 110^th.²⁹

The latest version of this rule, known as "Cut-As-You-Go," or "CUTGO," was adopted as part of the House rules package for the 118^th Congress.³⁰ The rule prohibits the consideration of any legislation that would cause a net increase in mandatory spending over either of two periods:

• the six-year period consisting of the current fiscal year, the budget year, and the four ensuing fiscal years; or
• the 11-year period consisting of the current year, the budget year, and the nine ensuing fiscal years.³¹

Unlike Statutory PAYGO and similar rules in the Senate, the House CUTGO rule does not include revenue when evaluating the budgetary effect of applicable provisions. In other words, under the rule, revenue increases cannot offset increases in mandatory spending, and revenue decreases do not need to be offset even if they increase the deficit.³²

Each version of clause 10 of House Rule XXI adopted since the 111^th Congress has included a provision exempting the budgetary effects of provisions designated as emergency requirements from enforcement under the rule. The House CUTGO rule adopted at the beginning of the 118^th Congress establishes that a provision designated as an emergency requirement under Statutory PAYGO shall be excluded from the evaluation under CUTGO of the provision's net effect on mandatory spending.³³ This emergency designation authority applies in the case of a point of order under the rule against the consideration of any bill or joint resolution, amendment made in order as original text by a special order of business, conference report, or amendment between the houses. It does not apply, however, to a floor amendment to a bill or joint resolution.³⁴

Senate PAYGO Rule

Since its first adoption in the FY1994 budget resolution, a PAYGO point of order has prohibited consideration in the Senate of new direct spending or revenue legislation that would increase the deficit over certain periods.³⁵ The latest version of the point of order adopted in the FY2018 budget resolution makes it out of order to consider any direct spending or revenue legislation that would increase the on-budget deficit for any of the following periods:³⁶

• the current fiscal year,
• the budget year,
• the six-year period beginning with the current fiscal year, and
• the 11-year period beginning with the current fiscal year.³⁷

As previously mentioned, the Senate has generally exempted emergency-designated provisions from various Senate budget enforcement rules through authorities adopted in budget resolutions. This includes the Senate PAYGO point of order. As with Budget Act enforcement and other Senate-specific points of order, the Senate exempts emergency-designated provisions from its PAYGO point of order through Section 4001(a) of S.Con.Res. 14 (117^th Congress), the FY2022 budget resolution.

History of Emergency Designations

The procedural treatment of legislation addressing unanticipated budgetary needs has long been a consideration for Congress in shaping the congressional budget process. Prior to 1990, however, there existed no formal procedures for considering such provisions. With the onset of new statutory budget enforcement procedures in 1990, Congress established formal procedures for making emergency designations and exempting the budgetary effects of such provisions from enforcement. In the years since, Congress has continued its authority to make these designations and exempt emergency-designated provisions from enforcement under applicable rules. As previously discussed, this includes establishing and reaffirming this authority through various statutes, budget resolutions, and congressional rules.

The rules and procedures associated with emergency designations in the congressional budget process have varied in some ways and undergone certain changes over time. This includes variations in the procedures for exempting the budgetary effect of emergency-designated provisions (i.e., adjusting budgetary levels to accommodate such provisions versus not counting their budgetary effects). There have also been significant developments in the purposes for which emergency designations are used in the past few decades, most notably through separate designations and exemptions for purposes that had historically been designated as emergency requirements (e.g., Overseas Contingency Operations/Global War on Terrorism and disaster relief).

The following sections outline these developments in detail, covering the history of emergency designations in the congressional budget process since 1974.

Early Treatment of Emergency Appropriations

Prior to 1990, non-explicit, informal rules and agreements largely dictated the consideration of budgetary provisions considered to be for emergency purposes.

In 1974, the Budget Act included requirements for Congress and the President, respectively, to account for expenditures related to unforeseen funding needs in the budget resolution and President's budget. The Budget Act required Congress to include an allowance for "contingencies" in the budget resolution for such purposes.³⁸ Similarly, the act required the President's budget to include "an allowance for additional estimated expenditures and proposed appropriations for the ensuing fiscal year, and an allowance for unanticipated uncontrollable expenditures for the ensuing fiscal year."³⁹ The Budget Act did not place any explicit limitations on either branch, however, with regard to their ability to request or enact spending for any purpose, including supplemental appropriations.

The informal treatment of appropriations for emergency purposes continued through the 1980s. Congress came together with President Ronald Reagan in 1987, and again with President George H. W. Bush in 1989, to negotiate budgetary agreements to meet enforceable deficit limits established in the Deficit Control Act in 1985.⁴⁰ Caps on discretionary appropriations were agreed to as part of these "budget summit" agreements in 1987 and 1989. In both cases, the two branches agreed not to initiate supplemental spending above these amounts "except in the case of dire emergency." Neither agreement specified a definition of a dire emergency or included a requirement that any supplemental spending for such purposes be offset.⁴¹

The Budget Enforcement Acts of 1990 and 1997

The Budget Enforcement Act (BEA) of 1990 first formalized the process for considering emergency spending and revenue provisions.⁴² It generally shifted the focus of the budget control mechanisms first established through the Deficit Control Act from the projected deficit to the spending or revenue effects of new legislation. The BEA of 1990 did so by providing for the enforcement of statutory discretionary spending limits and a limitation on changes to direct spending and revenues (PAYGO). Procedures for enforcing the discretionary spending limits and PAYGO were extended twice (in 1993 and 1997) and were effectively in place from FY1991 through FY2002.⁴³

As part of the enforcement procedures for the statutory discretionary spending limits, the BEA of 1990 also established allowable adjustments to accommodate certain spending, including emergency appropriations. Specifically, the act amended Section 251 of the Deficit Control Act to allow for adjustments to the discretionary caps up to any amount for discretionary appropriations that the President and Congress designated as emergency requirements.⁴⁴ A similar provision in the BEA of 1990 specified that the enforcement of PAYGO would exclude the budgetary effect of emergency-designated provisions as well.⁴⁵ These provisions established that either the President (through the President's budget or other means) or Congress (through statutory language) could initiate an emergency designation but required that both agreed to the designation.

The BEA of 1997 then extended these exemptions to enforcement under the Budget Act by creating Section 314 of the act. As previously discussed, this Section allows for adjustments to the levels associated with the budget resolution to accommodate the budgetary effects of provisions designated as emergency requirements.

The Budget Control Act of 2011

The statutory discretionary spending limits established in the BEA of 1990 and extended through subsequent legislation expired after FY2002. Subsequently, there were no statutory controls on discretionary spending in effect for FY2003-FY2011. Statutory discretionary spending limits were reestablished for FY2012 through FY2021, however, by the Budget Control Act (BCA) of 2011 as part of broader efforts to reduce the deficit.⁴⁶ The discretionary spending caps established by the BCA were enforced by sequestration, as the previous caps were.⁴⁷

As with the enforcement of discretionary spending limits under the BEA of 1990 and subsequent legislation, the caps established in the BCA included a provision requiring adjustments to accommodate spending designated as an emergency requirement. The amended version of Section 251(b)(2)(A) of the Deficit Control Act enacted through the BCA required that the sequestration report submitted by OMB include adjustments to the discretionary spending limits at levels equaling "the total of such appropriations in discretionary accounts designated as emergency requirements."⁴⁸ The amended version of Section 251(b)(2)(A) requires that Congress designate provisions (and that the President subsequently so designates) as an emergency requirement on an account-by-account basis.

The statutory discretionary spending limits established by the BCA were revised in 2013, 2015, 2018, and 2019 and ultimately expired after FY2021.⁴⁹

Emergency Designation Provisions in Budget Resolutions

In the absence of statutory discretionary spending limits, the emergency designation provisions in Section 251 of the Deficit Control Act and Section 314 of the Budget Act do not apply. Congress has historically made up for this by adopting authorities in budget resolutions creating emergency designations and exempting such provisions from enforcement under the Budget Act and other budget enforcement rules in the House and Senate. Congress emphasized the purpose of such provisions in the FY2004 budget resolution, the first budget resolution adopted since statutory discretionary spending limits expired after FY2002, stating

It is the purpose of this section, in the absence of an extension of the discretionary spending limits and PAYGO requirements under the Balanced Budget and Emergency Deficit Control Act of 1985, to enable Congress to designate provisions of legislation as an emergency in order to exempt such measures from enforcement of this resolution with respect to the new budget authority, outlays, and receipts resulting from such provisions.⁵⁰

These provisions have been in effect in various forms for the House and Senate in each fiscal year for which there were not statutory discretionary spending limits in place between FY2004 and FY2023 (FY2004, FY2005, FY2006, FY2007, FY2008, FY2009, FY2010, FY2011, FY2022, and FY2023).⁵¹

While these provisions have varied to some extent over time and between the House and Senate, they have generally

• established the authority for the House and/or Senate to make emergency designations, and
• exempted the budgetary effects of such provisions from enforcement under relevant sections of the Budget Act.⁵²

As previously mentioned, the Senate has also used these authorities to exempt emergency-designated provisions from other Senate-specific budgetary enforcement rules.⁵³

Exemptions for Overseas Contingency Operations/Global War on Terrorism and Disaster Relief

In recent decades, congressional rules for considering legislation addressing unforeseen budgetary needs have begun to differentiate between purposes that in the past had generally fallen under the category of emergency requirements. In practice, Congress has achieved this through provisions in budget resolutions and in statute that have established separate designations and exemptions for purposes that were previously designated as emergency requirements.

One of the primary examples of this practice stems from the costs associated with the military operations in Afghanistan, Iraq, and elsewhere in the early 2000s. Initial supplemental appropriations enacted to address the costs associated with these activities were designated as emergency requirements under existing emergency designation procedures and were thus exempt from relevant budgetary enforcement rules.⁵⁴ Beginning with the FY2005 budget resolution, however, the House created a separate designation and exemption for "contingency operations related to the global war on terrorism" (known as Overseas Contingency Operations).⁵⁵ Both the House and the Senate adopted provisions in various forms exempting discretionary appropriations for these purposes for most fiscal years between FY2006 and FY2010.⁵⁶ When the BCA reestablished statutory discretionary spending caps for FY2012-FY2021, the act also amended Section 251(b)(2)(A) of the Deficit Control Act to establish a designation and adjustment for "Overseas Contingency Operations/Global War on Terrorism" (OCO/GWOT).⁵⁷ Pursuant to this provision, the caps were adjusted up to any amount for discretionary appropriations that Congress designated as being for these activities. The designation in Section 251(b)(2)(A) for appropriations for OCO/GWOT purposes may be used to exempt such spending from the statutory discretionary spending limits for FY2024 and FY2025 enacted in the Fiscal Responsibility Act of 2023.

Congress had also historically designated discretionary appropriations for disaster relief as emergency requirements. Under the BCA, Congress created a separate designation and exemption for disaster spending.⁵⁸ The amended version of Section 251 of the Deficit Control Act enacted through the BCA⁵⁹ established, for the first time, a separate designation allowing discretionary spending caps to be adjusted to accommodate certain levels of discretionary appropriations for the costs of major disasters declared under the Stafford Act.⁶⁰ This designation operates parallel to the emergency designation, and its application has resulted in more disaster relief funding being included in annual appropriations measures, as the designated funding does not compete with other discretionary priorities within 302(b) suballocations. This, in turn, has somewhat reduced the demand for supplemental appropriations measures for these purposes.⁶¹

The designation in Section 251(b)(2)(D) of the Deficit Control Act for appropriations for disaster relief purposes may be used to exempt such spending from the statutory discretionary spending limits for FY2024 and FY2025 enacted in the Fiscal Responsibility Act of 2023.