BUDGET ROUNDUP: Review of Almost $1 Trillion in Cap-Adjusted Spending


  • Cap adjustments have allowed Congress to increase spending beyond the levels set forth in the Budget Control Act of 2011.
  • These cap adjustments have resulted in almost $1 trillion in additional spending.
  • The BCA contains several cap adjustments to increase spending for specified purposes, including emergencies, disasters, program integrity, and overseas contingency operations (OCO), without breaching the law’s spending limits.
  • The largest cap adjustments are the OCO and emergency designations.
  • Since FY 2012, this has resulted in an additional $723 billion in overseas contingency operations spending not subject to the BCA’s discretionary caps, while the emergency designation has resulted in $180 billion in additional spending.

A Brief History of the Budget Control Act of 2011:

  • The Budget Control Act was enacted in 2011 as a compromise to raise the nation’s debt limit in exchange for significant reductions in federal spending.
  • The law capped discretionary spending through fiscal year 2021 with the intention of reducing spending by more than $900 billion.
  • It also created a Joint Select Committee charged with further reducing the deficit and provided enforcement procedures to lower spending automatically if the Select Committee failed to meet its target.
  • The Select Committee failed to come up with an agreement to reduce the deficit. Starting in 2013, and then again in 2015 and 2018, Congress passed two-year spending deals to increase the BCA caps legislatively. These are in addition to the nearly $1 trillion in cap-adjusted spending.

The different types of cap adjustments can be split into three different categories:

  • Adjustments without a ceiling.
  • These raise the caps as much as is appropriated, as long as Congress and the President agree on the designation.
  • This category includes OCO and emergency designations.
  • Formula-Driven. The disaster relief cap adjustment has a maximum adjustment the Office of Management and Budget (OMB) calculates annually based on a statutory formula.
  • Adjustments with base requirements. These have a maximum adjustment and can only be used if Congress first provides a specific amount of non-adjusted appropriations.
  • This category includes four program integrity adjustments and wildfire suppression activities. The wildfire suppression adjustment does not come into effect until FY 2020.


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