When a new session of Congress begins in January, one of its first orders of business is to receive the annual budget submission of the President. Following receipt of the President's budget, Congress begins consideration of the budget resolution and other budgetary legislation for the upcoming fiscal year, which starts on October 1.¹

The transition from one presidential administration to another raises special issues regarding the annual budget submission.² Which President—the outgoing President or the incoming one—is required to submit the budget, and how will the transition affect the timing and form of the submission? The purpose of this report is to provide background information that addresses these questions.

Is the Outgoing or Incoming President Required to Submit the Budget?

The Budget and Accounting Act of 1921, as amended and codified in Title 31 of the U.S. Code, requires the President to submit a budget annually to Congress toward the beginning of each regular session.³ This requirement first applied to President Warren Harding for FY1923.

The deadline for submission of the budget, first set in 1921 as "on the first day of each regular session," has changed several times over the years:

• in 1950, to "during the first 15 days of each regular session;"⁴
• in 1985, to "on or before the first Monday after January 3 of each year (or on or before February 5 in 1986);"⁵ and
• in 1990, to "on or after the first Monday in January but not later than the first Monday in February of each year."⁶

The Twentieth Amendment to the Constitution, ratified in 1933, requires each new Congress to convene on January 3 (unless the date is changed by the enactment of a law) and provides a January 20 beginning date for a President's four-year term of office.⁷ Therefore, under the legal framework for the beginning of a new Congress, the beginning of a new President's term, and the deadline for the submission of the President's budget, all outgoing Presidents prior to the 1990 change were obligated to submit a budget.

The 1990 change in the deadline made it possible for an outgoing President to leave the annual budget submission to his or her successor, an option that the five outgoing Presidents since then (George H. W. Bush, Bill Clinton, George W. Bush, Barack Obama, and Donald Trump) took. Because President George H. W. Bush chose not to submit a budget for FY1994 (and was not obligated to do so), President Bill Clinton submitted the original budget for FY1994 rather than budget revisions. Similarly, the budgets for FY2002, FY2010, FY2018, and FY2022 were submitted by the incoming Presidents rather than by the outgoing Presidents. For example, the budget for FY2022 was submitted by the incoming President Joe Biden instead of the outgoing President Donald Trump.

President Donald Trump submitted an overview of his budget, America First: A Budget Blueprint to Make America Great Again, on March 16, 2017, 16 days after delivering an address on his economic plans to a joint session of Congress.⁸ He submitted the Appendix, which contained detailed budget information on May 23, 2017, as well as the Analytical Perspectives and the Major Savings and Reforms supplemental volumes.⁹

On April 9, 2021, the Office of Management and Budget (OMB) released President Biden's "Fiscal Year 2022 Discretionary Funding Request."¹⁰ The 58-page funding request—which was structured as a three-page letter with three enclosures—"lays out the President's discretionary funding recommendations across a wide range of policy areas and outlines a strategy for reinvesting in the foundations of our country's resilience and strength."¹¹ On May 28, 2021, President Biden submitted his FY2022 budget, titled Budget of the U.S. Government, as well as the Appendix and Analytical Perspectives supplemental volumes.¹²

Prior to the 1990 statutory change, incoming Presidents except for Warren Harding assumed office with budget of their predecessors having already been submitted. After the 1990 change, Presidents Bill Clinton, George W. Bush, Barack Obama, Donald Trump, and Joe Biden took office without a prior submission by the preceding President. If an outgoing President were to submit a budget immediately before leaving office, an incoming President may submit a revised budget request—sometimes known as budget revisions—to Congress at any time. Before the 1990 change, six incoming Presidents chose to modify their predecessors' budgets by submitting revisions shortly after taking office: Dwight Eisenhower, John Kennedy, Richard Nixon, Gerald Ford, Jimmy Carter, and Ronald Reagan. During the same period, six incoming Presidents chose not to submit revisions: Calvin Coolidge, Herbert Hoover, Franklin Roosevelt, Harry Truman, Lyndon Johnson, and George H. W. Bush.¹³

Transition Budgets in Recent Years from FY1977 to Present

A watershed for the congressional budget process occurred in 1974 with the enactment of the Congressional Budget and Impoundment Control Act of 1974.¹⁴ Full implementation of the law began with FY1977, which provides a potential starting point for looking at more recent experience with transition year budgets.

During the period beginning with the full implementation of the congressional budget process (in FY1977), eight transitions of presidential administration have occurred. As Table 1 shows, the three outgoing Presidents who were required to submit a budget during this period (Gerald Ford, Jimmy Carter, and Ronald Reagan) did so on or before the statutory deadline. The five Presidents who were not required to submit an outgoing budget (George H. W. Bush, Bill Clinton, George W. Bush, Barack Obama, and Donald Trump) each chose to leave the budget submission to his successor.

Once the original budget for a fiscal year has been submitted, a President or his or her successor may submit revisions at any time. Two incoming Presidents during this period (Jimmy Carter and Ronald Reagan) submitted budget revisions and one (George H. W. Bush) did not. The FY1978 revisions by President Jimmy Carter (a 101-page document) were submitted on February 22, 1977, and the FY1982 revisions by President Ronald Reagan (an initial 159-page document and a subsequent 435-page document) were submitted on March 10 and April 7, 1981, respectively.

Statutory Deadlines

In past years, Congress authorized the submission of a budget for a fiscal year after the statutory deadline by enacting a deadline extension in law. For example, the deadlines for submission of the budgets for FY1981, FY1984, and FY1986 were extended from mid-January to late January or early February by P.L. 96-186, P.L. 97-469, and P.L. 99-1, respectively. Beginning in the late 1980s, several original budgets were submitted late without such authorization. For FY1991, the budget was submitted a week after a deadline that had already been extended by law (P.L. 101-228). For FY1989, the budget was submitted 45 days after the deadline without the consideration of any measure granting a deadline extension.

The four most recent transition-year budgets (FY2002, FY2010, FY2018, and FY2022) were submitted by incoming administrations 63, 98, 38, and 116 days beyond the deadline, respectively, without the consideration of a measure granting a deadline extension. Presidents George W. Bush and Barack Obama submitted the original budgets for FY2002 and FY2010 on April 9, 2001, and May 7, 2009, respectively. President Donald Trump submitted the original budget for FY2018 on March 16, 2017. President Joe Biden submitted the original budget for FY2022 on May 28, 2021.

Initial Special Messages to Congress After Transitions

Although Presidents Ronald Reagan, Bill Clinton, George W. Bush, Barack Obama, and Donald Trump did not submit detailed budget proposals until April or May of their first year in office, each of them advised Congress regarding the general contours of their economic and budgetary policies in special messages submitted to Congress in February. Though President George H. W. Bush did not submit an official revision of President Reagan's FY1990 budget, he submitted a message to Congress that contained many of the same elements as budget revisions that had been submitted by previous incoming Presidents. In conjunction, each incoming President since Ronald Reagan has presented a special message to a joint session of Congress, often discussing economic and budget plans.¹⁵

Occasional Outgoing "Transition" Budgets After 1990

The five most recent Presidents who were not required to submit outgoing budgets (George H. W. Bush, Bill Clinton, George W. Bush, Barack Obama, and Donald Trump) each chose to leave the budget submission to their successors. Nevertheless, Presidents Bill Clinton and George H. W. Bush sought to facilitate the development of their successors' budgets by providing what might be called a transition budget volume to Congress.

On January 6, 1993, just prior to the inauguration of President Bill Clinton, President George H. W. Bush submitted to Congress a 573-page, single-volume budgetary document, Budget Baselines, Historical Data, and Alternatives for the Future. Instead of constituting a budget in the usual sense, this document provided historical data, baseline budget projections under the status quo, and illustrations of budget projections using alternative economic assumptions and different broad policy outlines.

Similarly, on January 16, 2001, President Clinton prepared a transition budget for incoming President George W. Bush, FY2002 Economic Outlook, Highlights from FY1994 to FY2001, FY2002 Baseline Projections. The volume was comparable in scope to the one issued for FY1994 by President George H. W. Bush just before he left office, providing revised budget projections and an economic and programmatic update.

Potential Issues for Congress

In the wake of statutory changes in 1990, presidential budget submissions in transition years have more closely corresponded to the arrival of new Presidents. Several potential questions regarding the submission of the President's budget during a transition year may be of interest to the 117^th Congress. For the purposes of this report, potential issues can be grouped into two topics:

• 1. President's budget submission deadlines, and
• 2. the role of OMB in presidential transitions.

Since the statutory deadline for the submission of the President's budget was changed in 1990 to "on or after the first Monday in January but not later than the first Monday in February of each year,"¹⁶ all of the subsequent incoming President's budgets have been submitted to Congress late, long after the statutory deadline. Possible questions for Congress related to this issue include:

• Should the deadline for the President's budget submission be changed?
• Do late submissions of the President's budget have implications for the congressional budget process?

In addition, there may be questions related to OMB's role in the submission of the President's budget during a transition year. For example, recently, some observers have noted tensions between OMB and incoming presidential transition teams.¹⁷ According to media reports, the Biden Administration's transition team "'encountered obstruction' and 'roadblocks' from political leadership" at OMB,¹⁸ reportedly experienced less cooperation than OMB had provided during past transitions,¹⁹ and expressed concerns that the alleged lack of cooperation from OMB "could delay the fiscal 2022 budget process."²⁰ On December 31, 2020, OMB published a letter authored by OMB director Russell Vought that addressed such concerns.²¹ Consequently, some relevant questions may include:

• Should the process for submitting the President's budget differ in transition years?
• What is the role of OMB in presidential transitions?
• What lessons could be learned from the potential underlying points of dispute in 2020 and 2021 between OMB and the incoming Biden Administration?
• Do presidential transitions as they relate to budget submissions need to be examined or streamlined?