Discretionary Budget Authority by Subfunction: An Overview
Congressional research reportMar 21, 2024
Ask Donna
What actually matters in this document.
Text
Discretionary Budget Authority by
Subfunction: An Overview
Updated March 21, 2024
Congressional Research Service
https://crsreports.congress.gov
R41726
SUMMARY
Discretionary Budget Authority by
Subfunction: An Overview
R41726
March 21, 2024
D. Andrew Austin
Analyst in Economic Policy
This report provides a graphical overview of historical trends in discretionary budget authority
(BA) from FY1977 through FY2023, preliminary estimates for FY2024 spending, and the levels
reflecting the President’s proposals for FY2024 through FY2029 using data from the FY2025
budget submission released in March 2024. This report, by illustrating trends in broad budgetary
categories, provides a starting point for discussions about fiscal priorities. As the 118th Congress
considers funding for the rest of FY2024 and the upcoming FY2025 budget, past spending trends may help frame policy
discussions. Other CRS products analyze funding for specific agencies, program areas, or appropriations bills.
Functional categories (e.g., national defense, agriculture, etc.) provide a means to compare federal funding for activities
within broad policy areas that often cut across several federal agencies. Subfunction categories provide a finer division of
funding levels within narrower policy areas. Budget function categories are used within the budget resolution and for other
purposes, such as estimates of tax expenditures. Spending in this report is measured and illustrated in terms of discretionary
budget authority as a percentage of gross domestic product (GDP). Measuring spending as a percentage of GDP in effect
controls for inflation and population increases. A flat line on such graphs indicates that spending has increased at the same
rate as overall economic growth. In some cases, rescissions, offsetting receipts, or budgetary scorekeeping adjustments can
result in negative budget authority.
Discretionary spending is provided and controlled through appropriations acts, which provide budget authority to federal
agencies to fund federal government functions such as running executive branch agencies, congressional offices and
agencies, and international operations of the government. Essentially all spending on federal wages and salaries is
discretionary. Administrative costs for entitlement programs such as Social Security are generally funded by discretionary
spending, while mandatory spending—not shown in this report’s figures—generally funds the program benefits. The division
of funding into discretionary and mandatory categories for surface transportation, however, is complex.
Statutory caps on discretionary spending were originally set in the Budget Enforcement Act of 1990 (BEA; P.L. 101-508),
which also limited mandatory spending and revenue reductions. Those caps were extended through the 1990s, but expired
shortly after the attacks of September 11, 2001. Both defense and nondefense discretionary spending grew more rapidly in
the following decade compared to the 1990s. The Budget Control Act of 2011 (P.L. 112-25; BCA) reimposed caps on
discretionary spending. Most BCA caps were divided between defense and nondefense funding. Congress modified BCA
caps several times to avoid decreasing discretionary funding levels. The BCA caps expired at the end of FY2021. In June
2023, the Fiscal Responsibility Act (FRA; P.L. 118-5) suspended the federal debt limit and reestablished statutory caps on
discretionary spending for FY2024 and FY2025, which were again divided between defense and nondefense categories.
Two separate crises strongly affected public sector spending in the United States, as elsewhere. The financial crisis of 20072009 and the subsequent Great Recession prompted large fiscal policy responses, including spending increases and tax
(revenue) reductions aimed at supporting economic activity. The COVID-19 pandemic starting in 2020 presented
governments around the world, including the U.S. government, with extreme fiscal challenges. The bulk of the fiscal
responses to the 2007-2009 Great Recession came through mandatory spending or automatic stabilizers, which result in high
income support outlays and lower tax revenues during economic downturns, as well as through tax reductions. Fiscal
responses to the COVID-19 pandemic also increased discretionary spending, although changes in mandatory spending were
larger.
Across the broadest functional categories, OMB projects a decline in future discretionary spending as a share of the GDP.
After a buildup in the early 1980s, National Defense funding fell, especially after the collapse of the Soviet Union and its
allied Warsaw Pact. National Defense funding then rose after the attacks of September 11, 2001, and the wars in Afghanistan
and Iraq, but has been falling as a share of GDP since FY2010. Human Resources funding as a share of GDP fell sharply in
the late 1970s and early 1980s, but rose significantly during the Great Recession and the COVID-19 pandemic. Funding for
Physical Resources also rose during the Great Recession and the COVID-19 pandemic, as well as after major disasters.
Funding for Other Functions—comprising Agriculture; Administration of Justice; General Science, Space, and Technology;
and General Government—has been falling as a share of GDP since FY2010. Other CRS reports discuss funding of specific
programs and policy areas in more detail.
Congressional Research Service
Discretionary Budget Authority by Subfunction: An Overview
Contents
Introduction ..................................................................................................................................... 1
Budget Concepts and Discretionary Spending .......................................................................... 1
Budget Policy and Discretionary Spending .............................................................................. 2
Funding for FY2023 ........................................................................................................... 2
Funding in FY2024 and FY2025 ........................................................................................ 3
Overview of Recent Discretionary Spending .................................................................................. 3
The Budget Control Act of 2011 ............................................................................................... 4
Congress Modified BCA Caps to Mitigate Fiscal Stringency ................................................... 5
Coronavirus Pandemic and Federal Responses in 2020 and 2021 ............................................ 6
Caps on Discretionary Spending Reinstated for FY2024 and FY2025 ..................................... 7
Federal Budget Data and Concepts ................................................................................................. 7
OMB Budget Data..................................................................................................................... 7
Negative Budget Authority ....................................................................................................... 7
Federal Credit Programs ........................................................................................................... 8
Background on Functional Categories ............................................................................................ 9
Superfunction Categories .......................................................................................................... 9
Subfunction Categories ........................................................................................................... 10
Historical Spending Trends ........................................................................................................... 13
Defense and International Affairs ........................................................................................... 13
Cold War, Peace Dividend, and the Global War on Terror ............................................... 13
Defense Funding Outside of the Department of Defense ................................................. 17
International Affairs .......................................................................................................... 18
Domestic Social Programs ...................................................................................................... 20
Nondefense Security and Nonsecurity Spending Diverge After 9/11 ............................... 21
The Recovery Act ............................................................................................................. 22
Education, Training, Employment, and Social Services ................................................... 22
Federal Health Programs................................................................................................... 24
Income Security ................................................................................................................ 25
Social Security .................................................................................................................. 27
Veterans’ Benefits and Services ........................................................................................ 27
Physical Resources .................................................................................................................. 30
Energy ............................................................................................................................... 30
Natural Resources and Environment................................................................................. 32
Commerce and Housing Credit ......................................................................................... 35
Transportation ................................................................................................................... 37
Community and Regional Development ........................................................................... 38
Other Federal Functions .......................................................................................................... 40
General Science, Space, and Technology ......................................................................... 40
Agriculture ........................................................................................................................ 42
Administration of Justice .................................................................................................. 43
General Government ......................................................................................................... 45
Figures
Figure 1. Discretionary Funding by Budget Superfunction, FY1977-FY2029 ............................... 9
Congressional Research Service
Discretionary Budget Authority by Subfunction: An Overview
Figure 2. Discretionary Defense and Nondefense Spending ......................................................... 14
Figure 3. Defense Discretionary BA by Major Title, FY1977-FY2029 ........................................ 15
Figure 4. National Defense (050) Subfunctions ............................................................................ 18
Figure 5. International Affairs (150) Subfunctions........................................................................ 19
Figure 6. Discretionary Funding for Human Resources Functions ............................................... 20
Figure 7. Security and Nonsecurity Funding Trends ..................................................................... 21
Figure 8. Education, Training, Employment, and Social Services (500) Subfunctions ................ 23
Figure 9. Federal Health Programs ................................................................................................ 24
Figure 10. Income Security (600) Subfunctions ............................................................................ 26
Figure 11. Social Security (650) Subfunction ............................................................................... 27
Figure 12. Veterans’ Benefits and Services (700) Subfunctions .................................................... 29
Figure 13. Discretionary Funding for Physical Resources ............................................................ 31
Figure 14. Energy (270) Subfunctions .......................................................................................... 32
Figure 15. Natural Resources and Environment (300) Subfunctions ............................................ 34
Figure 16. Commerce and Housing Credit (370) Subfunctions .................................................... 36
Figure 17. Transportation (400) Subfunctions............................................................................... 38
Figure 18. Community and Regional Development (450) Subfunctions ...................................... 39
Figure 19. Discretionary Funding for Other Government Functions ............................................ 41
Figure 20. General Science, Space, and Technology (250) Subfunctions ..................................... 41
Figure 21. Agriculture (350) Subfunctions .................................................................................... 42
Figure 22. Administration of Justice (750) Subfunctions .............................................................. 44
Figure 23. General Government (800) Subfunctions .................................................................... 45
Tables
Table 1. Budget Function Categories by Superfunction ................................................................. 11
Appendixes
Appendix. Descriptions of Budget Functions................................................................................ 48
Contacts
Author Information........................................................................................................................ 50
Congressional Research Service
Discretionary Budget Authority by Subfunction: An Overview
Introduction
This report presents figures showing trends in discretionary budget authority as a percentage of
gross domestic product (GDP) by subfunction within each of 17 budget function categories, using
data from President Joseph R. Biden’s FY2025 budget submission.1 This report provides a
graphical overview of historical trends in discretionary budget authority from FY1977 through
FY2023, estimates for FY2024 spending, and the levels consistent with the President’s proposals
for FY2024 through FY2029.2 Spending in this report is shown as a percentage of GDP to control
for the effects of inflation, population growth, and growth in per capita income.3 Past spending
trends may prove useful in framing policy discussions as the 118th Congress prepares to confront
a new set of challenges while it considers how to fund the federal budget for the remainder of
FY2024 and starts deliberations on funding for FY2025.
Budget Concepts and Discretionary Spending
Appropriations acts provide and control discretionary spending,4 which funds many of the
activities commonly associated with federal government functions, such as running executive
branch agencies, congressional offices and agencies, and international operations of the
government.5 Mandatory spending, which is provided by other kinds of acts, supports the much
larger expenditures on various program benefits. For some program areas, such as highway and
mass transportation funding, the division of spending into discretionary and mandatory categories
is more complex.
Discretionary spending in this report is measured in terms of budget authority (BA). An agency
head with BA can obligate the federal government to make payments, subject to congressional
restrictions, for contractors, employees, or grantees to carry out the goals set in legislation.
Outlays occur when the U.S. Treasury disburses funds to honor those obligations. Thus, outlays
follow BA with a lag. Outlays for personnel costs mostly occur in the same year that BA is
provided, but for large and complex projects, outlays may be spread over several years. Nearly all
BA eventually results in outlays. In some cases, BA expires without being used. For instance, an
agency might have difficulty in hiring personnel with the right qualifications or in finding a
contractor with appropriate capabilities or a contract might cost less than anticipated. In a few
cases, major federal initiatives were later curtailed or cancelled, resulting in the rescission of BA.
For instance, most funding for the Carter Administration’s synthetic fuels program and the Obama
Administration’s plans for high-speed rail did not result in outlays.
1 The President’s FY2025 budget (http://www.whitehouse.gov/omb/budget/) was released on March 11, 2024. Because
final appropriations for FY2024 had not been enacted at that date, FY2024 spending levels included in the budget
reflect those in an earlier continuing resolution as well as certain Administration proposals.
2 The start of the federal fiscal year was changed from July 1 to October 1 in 1976 to accommodate changes in the
congressional budget process. The figures omit data for the transition quarter (July 1 to September 30, 1976).
3 The Bureau of Economic Analysis (BEA) released a major revision to national income accounts in July 2013, which
showed somewhat higher levels of national income and thus slightly reduced government spending as a share of GDP.
See Stephanie H. McCulla, Alyssa E. Holdren, and Shelly Smith, “Improved Estimates of the National Income and
Product Accounts: Results of the 2013 Comprehensive Revision,” Survey of Current Business, September 2013, pp. 1445, http://bea.gov/scb/pdf/2013/09%20September/0913_comprehensive_nipa_revision.pdf.
4 In some cases, Congress has specified that some funding provided in a measure that is not an appropriations act be
classified as discretionary. Section 23008 of the CARES Act of 2020 (P.L. 116-136) specified that certain funding in
Title B be designated as discretionary, although that measure was an authorizing act.
5 For a broader analysis of discretionary spending, see CRS Report RL34424, The Budget Control Act and Trends in
Discretionary Spending, by D. Andrew Austin.
Congressional Research Service
1
Discretionary Budget Authority by Subfunction: An Overview
In some cases, changes in funding levels recorded in historical budget data reflect changes in
budgetary concepts or the budgetary treatment of some types of spending. For example, the
Federal Credit Reform Act of 1990 (P.L. 101-508) changed the budgetary treatment of federal
loan and other credit programs starting in FY1992.
Budget Policy and Discretionary Spending
Discussions about the appropriate levels of spending for various policy objectives of the federal
government always have played an important role in congressional deliberations over funding
measures. For example, concerns about the trajectory of fiscal policy after the financial crisis of
2007-2009 led to the reestablishment of enforceable statutory caps on discretionary funding in the
2011 Budget Control Act (P.L. 112-25) and again with enactment of the Fiscal Responsibility Act
(FRA; P.L. 118-5) in 2023.
More recently, the scale of fiscal responses to the COVID-19 pandemic as well as post-pandemic
funding for infrastructure, industrial subsidies, and climate change initiatives prompted renewed
discussions over federal fiscal policy. Rising debt levels, a post-pandemic quickening of inflation,
and persistent deficits have also heightened fiscal policy concerns.
Some recent authorizing measures contained substantial discretionary appropriations. The
CARES Act of 2020 (§23008; P.L. 116-136), enacted in March 2020 shortly after COVID-19 was
declared a pandemic, appropriated funds for various federal initiatives. The Infrastructure
Investment and Jobs Act (IIJA; P.L. 117-58) provided $163 billion in discretionary funding for
FY2022 and an estimated $283 billion in funding for the following decade. Most of those funds
support transportation programs, pollution control and abatement, broadband deployment, and
energy programs.6
The growth of social insurance and health program spending, mostly funded through mandatory
spending, has also been an issue of concern because those programs comprise the majority of
federal outlays.7
Funding for FY2023
Funding for FY2023 was first provided by a continuing resolution (P.L. 117-180) that included
supplemental appropriations to support Ukraine’s defense against the Russian invasion. After two
one-week continuing resolutions (P.L. 117-229 and P.L. 117-264) were enacted in December
2022, a final appropriations measure (P.L. 117-328) for FY2023 was enacted on December 29,
2022. According to Congressional Budget Office (CBO) estimates, the act provided $1,715
billion in discretionary BA.8
The enactment of final FY2023 appropriations at the end of December 2022, rather than before
the start of the fiscal year on October 1, 2022, hindered OMB’s ability to estimate current budget
year amounts in the Administration’s FY2024 budget submission.9
6 CBO, The Budget and Economic Outlook: 2022 to 2032, May 2022, https://www.cbo.gov/publication/
58147#_idTextAnchor143.
7 CRS Report R44641, Trends in Mandatory Spending, by D. Andrew Austin.
8 CBO, CBO Estimate for Divisions A through N of H.R. 2617 (as modified by S.A. 6552), the Consolidated
Appropriations Act, 2023, December 21, 2022, https://www.cbo.gov/publication/58872. For estimates of mandatory
(direct) spending, see CBO Estimate for Divisions O Through MM of H.R. 2617, the Consolidated Appropriations Act,
2023, Enacted as P.L. 117-328 on December 29, 2022, January 12, 2023, https://www.cbo.gov/publication/58872.
9 OMB, FY2024 Budget, Analytical Perspectives, ch. 4, Budget Process, p. 44, https://www.whitehouse.gov/wpcontent/uploads/2023/03/ap_4_process_fy2024.pdf.
Congressional Research Service
2
Discretionary Budget Authority by Subfunction: An Overview
Funding in FY2024 and FY2025
In June 2023, the Fiscal Responsibility Act (FRA; P.L. 118-5) suspended the federal debt limit
and set new statutory caps on discretionary spending for FY2024 and FY2025.10 CBO estimated
that those caps and other provisions would reduce discretionary spending over the coming decade
by $1.3 trillion, relative to baseline spending levels. The caps are backed by the prospect of
sequestration—that is, across-the-board cuts in nonexempt accounts—administered by OMB.11 In
the past, Congress has almost always passed measures that comply with budgetary limits,
avoiding an OMB-administered sequester.
A series of continuing resolutions have provided funding for the federal government’s operations.
At this writing, final annual appropriations for FY2025 have not been enacted.
The Biden Administration submitted its budget plans for FY2025 on March 11, 2024.12
Administration budget data were used to compute this report’s figures. Administration budgets
typically use information available in late November to compile the following year’s budget
submission.
Overview of Recent Discretionary Spending
Federal fiscal policy in the past two decades has been shaped by two severe shocks, as noted
above and discussed in more detail below.
First, the 2007-2009 financial crisis and the ensuing Great Recession was the most serious
economic downturn since the Great Depression of the 1930s.13 Government deficits and debt
typically rise after serious financial crises and economic downturns for two main reasons. First,
tax revenues typically drop during economic downturns. Second, as recession reduces incomes
for many households, spending increases due to the effect of “automatic stabilizers”—that is,
programs that provide benefits linked to income levels or unemployment. In addition, Congress
passed the American Recovery and Reinvestment Act of 2009 (ARRA; P.L. 111-5), which
combined a package of increased federal funding for education, energy, and other areas; greater
support for state and local governments; and tax reductions.
Second, the COVID-19 pandemic, the most serious global health emergency in the past century,
had profound effects on economic activity, health systems, and finances of households and
governments.14
The direct and indirect effects of the 2007-2009 financial crisis and the COVID-19 pandemic
both resulted in large increases in federal deficit spending. While federal deficit spending
10 CBO, CBO’s Estimate of the Budgetary Effects of H.R. 3746, the Fiscal Responsibility Act of 2023, May 30, 2023,
https://www.cbo.gov/publication/59225.
11 CBO, An Update About Implementing the Statutory Limits on Discretionary Funding for FY2024, March 13, 2024,
https://www.cbo.gov/publication/60081.
12 OMB, FY2025 Budget of the U.S. Government, March 11, 2024, https://www.whitehouse.gov/omb/budget/.
13 National Bureau of Economic Research, Business Cycle Dating Committee, “June 2009 Business Cycle Trough/End
of Last Recession,” September 20, 2010, https://www.nber.org/news/business-cycle-dating-committee-announcementseptember-20-2010.
14 The John Hopkins Coronavirus Resource Center (https://coronavirus.jhu.edu/region/united-states), when it stopped
updating its data, estimated that 1.1 million people had died from COVID-19 in the United States. The Centers for
Disease Control (CDC) estimates that about 675,000 people died from the Spanish flu in 1918-1919. See CDC,
“History of 1918 Flu Epidemic,” web page, March 21, 2018, https://www.cdc.gov/flu/pandemic-resources/1918commemoration/1918-pandemic-history.htm.
Congressional Research Service
3
Discretionary Budget Authority by Subfunction: An Overview
supports economic activity and household incomes, the sharp increases in federal debt levels
raised concerns about the sustainability of public finances.
The Budget Control Act of 2011
Fiscal policy became a central concern of Congress in the wake of the 2007-2009 Great
Recession. In early 2011, prompted by those concerns, some in Congress sought to constrain
discretionary spending in the final FY2011 appropriations measure.15 In August 2011,
negotiations over fiscal policy and the debt limit led to the reimposition of spending caps and
associated budget enforcement mechanisms that had lapsed after FY2001 through the enactment
of the Budget Control Act of 2011 (BCA; P.L. 112-25).
The BCA set statutory caps on discretionary spending, similar to those that had lapsed in 2002,
and set up budget enforcement mechanisms designed to achieve $2.1 trillion in savings over the
period FY2012-FY2021.16 An initial set of discretionary caps was estimated to save about $900
billion over 10 years. A bipartisan Joint Select Committee on Deficit Reduction, often known as
the “Super Committee,” was tasked with developing a plan to reduce deficits by $1.2 trillion or
more.
When that committee reported no plan by a November 2011 deadline, backup budget
enforcement measures were triggered, including a January 2013 sequester (a cancellation of
budgetary resources by OMB), and a revised set of discretionary caps on funding for defense
(defined as the national defense budget function 050) and nondefense programs (all other) for
FY2013-FY2021.17 Those revised caps were to be lowered in each year by an amount calculated
by the Office of Management and Budget (OMB) according to a formula designed to achieve a
prorated share of the $1.2 trillion deficit reduction that a Joint Select Committee plan did not
achieve. An annual sequester of nonexempt mandatory spending accounts also contributes to
those savings.
The spending trajectory implied by those backup enforcement measures implied discretionary
base defense spending would have reverted to a level slightly above its FY2007 level in real
dollar terms (i.e., adjusting for inflation but not for growth in population or the economy), while
nondefense discretionary spending would have reverted to a level near its FY2003 level.18
Discretionary spending as a share of GDP, had unmodified BCA caps remained in place, would
have declined to levels well below those seen in recent decades. CBO baseline projections
15 See CRS Report R41771, FY2011 Appropriations in Budgetary Context, by D. Andrew Austin and Amy Belasco.
16 For more information on the BCA, see CRS Report R41965, The Budget Control Act of 2011, by Bill Heniff Jr.,
Elizabeth Rybicki, and Shannon M. Mahan.
17 Section 302 of the BCA set out procedures for lowering those revised caps by adding §251A to the Balanced Budget
and Emergency Deficit Control Act of 1985 (BBEDCA; P.L. 99-177). In FY2013, the lowering of the BCA caps was
implemented through sequestration. See CBO, Sequestration Update Report, August 2012, p. 3, available at
http://www.cbo.gov/sites/default/files/cbofiles/attachments/08-09-12_SequestrationUpdate.pdf; and OMB,
Sequestration Update Report to the President and Congress for Fiscal Year 2013, August 20, 2012, p. 13, available at
http://www.whitehouse.gov/sites/default/files/omb/assets/legislative_reports/sequestration/
sequestration_update_august2012.pdf.
18 For details, see CRS congressional distribution memorandum, “The Budget Control Act and Alternate Defense and
Nondefense Spending Paths, FY2012-FY2021,” by Amy Belasco and Andrew Austin, November 16, 2012, available to
congressional clients upon request. This comparison is made in terms of budget authority. Before passage of ATRA,
BCA provisions were slated to bring discretionary base defense spending to its FY2007 level and nondefense spending
to near its level in FY2003 or FY2004. Inflation adjustments made using GDP price index.
Congressional Research Service
4
Discretionary Budget Authority by Subfunction: An Overview
suggested that discretionary spending would have accounted for 5.3% of GDP in FY2026, two
percentage points below its level in FY2007 (7.3%), just before the start of the Great Recession.19
BCA caps were adjusted to accommodate certain types of spending, such as war spending
(designated as “overseas contingency operations”), emergency appropriations, disaster relief, and
program integrity initiatives.20 In particular, war-designated funding has been seen as a “relief
valve” that has taken budgetary pressure off priority military and international programs.21 Some
Members of Congress have argued that war spending cap adjustments weakened fiscal
discipline.22
Congress Modified BCA Caps to Mitigate Fiscal Stringency
The stringency of BCA discretionary spending caps and backup enforcement measures prompted
Congress and the President to adjust those limits several times to avoid dislocations of federal
operations.23 Some journalists and others have referred to sequestration as a reversion to tighter
caps on spending after a lapse of a Bipartisan Budget Act provision allowing higher levels of
discretionary spending—something unrelated to the formal definition of sequestration.
The American Taxpayer Relief Act of 2012 (ATRA; P.L. 112-240) delayed the slated FY2013
sequester and reduced its size from $109 billion to $85 billion. ATRA, which also extended
certain tax reductions, addressed concerns that the expiration of certain tax cuts and imposition of
spending cuts could hinder economic recovery from the Great Recession, avoiding what had been
called a “fiscal cliff.”24
The Bipartisan Budget Act of 2013 (BBA 2013; H.J.Res. 59; P.L. 113-67), enacted in December
2013 and popularly known as the Murray-Ryan budget agreement, set a pattern for adjusting BCA
caps. The BBA 2013 raised BCA FY2014 limits for defense and nondefense by $22.4 billion each
and raised FY2015 limits by $9.3 billion each. The Bipartisan Budget Act of 2015 (BBA 2015;
P.L. 114-74) raised the FY2016 cap levels on both categories by $25 billion and the FY2017 cap
levels by $15 billion.
The Bipartisan Budget Act of 2018 (BBA 2018; H.R. 1892, P.L. 115-123), enacted February 9,
2018, raised the defense cap by about $80 billion for FY2018 and $85 billion for FY2019 and the
19 CBO, Budget and Economic Outlook: 2017 to 2027, January 24, 2017, Table 1-1, http://www.cbo.gov/publication/
52370. CBO baseline projections assume current laws remain in effect and that discretionary spending levels remain
constant in inflation-adjusted terms.
20 For BCA caps to be adjusted, emergency funding and war funding (Overseas Contingency Operations/Global War on
Terrorism) must be designated on an account-by-account basis by Congress and the President. Cap adjustments for
disaster funding are subject to a limit set at a 10-year average of previous disaster funding. The BCA established
separate caps for certain program integrity initiatives.
21
See CRS Report R44519, Overseas Contingency Operations Funding: Background and Status, by Brendan W.
McGarry and Emily M. McCabe. Also see Marcus Weisgerber, “‘Magic Money’: DoD’s Overseas Contingency Budget
Might Dry Up,” Defense News, June 29, 2014, http://archive.defensenews.com/article/20140629/DEFREG02/
306290011/-Magic-Money-DoD-s-Overseas-Contingency-Budget-Might-Dry-Up. Also see archived CRS Report
RL33110, The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11, by Amy Belasco,
available to congressional clients upon request.
22 Joe Gould, “Trump Selects OCO-Opponent Mulvaney for OMB,” Defense News, December 19, 2016,
http://www.defensenews.com/articles/trump-selects-oco-opponent-mulvaney-for-omb.
23 A CRS congressional distribution memorandum “The Evolution of Budget Control Act of 2011 Caps on
Discretionary Spending” is available upon request to congressional clients.
24 ATRA was enacted on January 1, 2013. Budgetary adjustments that affected the FY2013 sequester are described in
the CRS congressional distribution memorandum “The Evolution of Budget Control Act of 2011 Caps on Discretionary
Spending.”
Congressional Research Service
5
Discretionary Budget Authority by Subfunction: An Overview
nondefense cap by about $63 billion for FY2018 and $67 billion for FY2019.25 BBA 2018 also
contained several changes in federal social programs and again suspended the debt limit.26
The Bipartisan Budget Act of 2019 (BBA 2019; H.R. 3877, P.L. 116-37), enacted on August 2,
2019, set discretionary cap levels for FY2020 and FY2021, allowing for higher spending in both
the defense and nondefense categories. At the end of FY2021, BCA caps on discretionary
spending (BA) expired, although BCA sequestration of nonexempt mandatory spending has been
extended.27 Discretionary caps, as noted above, were reinstated for FY2024 and FY2025 by the
Fiscal Responsibility Act (P.L. 118-5).
Coronavirus Pandemic and Federal Responses in 2020 and 2021
The COVID-19 pandemic confronted the federal government, like governments around the
world, with extraordinary fiscal challenges.28 In part, deficits were pushed upward through
“automatic stabilizers,” such as expanded income support payments and diminished tax receipts
as household incomes and business profits fell.29 The designation of COVID-19 as a pandemic in
mid-March 2020 prompted fiscal policy responses in 2020 and 2021 that increased federal
spending and deficits, as percentage of GDP, to levels not seen since World War II.30 Most of the
federal fiscal response was provided through mandatory spending, and to a lesser extent in
revenue reductions.
The CARES Act (P.L. 116-136), enacted in late March 2020, provided an estimated $326 billion
in discretionary funding, while providing $988 billion in mandatory spending and $408 billion in
revenue reductions. The Paycheck Protection Program and Health Care Enhancement Act (P.L.
116-139) provided an additional $162 billion in discretionary funding as well as $321 billion in
mandatory spending.31
25 CBO, Bipartisan Budget Act of 2018, February 8, 2018, https://www.cbo.gov/system/files/115th-congress-2017-
2018/costestimate/bipartisanbudgetactof2018.pdf.
26 See CRS Report R45126, Bipartisan Budget Act of 2018 (P.L. 115-123): Brief Summary of Division E—The
Advancing Chronic Care, Extenders, and Social Services (ACCESS) Act, coordinated by Paulette C. Morgan. Also see
CRS Report R45136, Bipartisan Budget Act of 2018 (P.L. 115-123): CHIP, Public Health, Home Visiting, and
Medicaid Provisions in Division E, coordinated by Alison Mitchell and Elayne J. Heisler.
27 The sequestration of mandatory spending was extended through the first half of FY2032 for Medicare patient care
outlays and through FY2031 for other nonexempt programs. See OMB, FY2024 Budget, Analytical Perspectives, p. 37,
https://www.whitehouse.gov/wp-content/uploads/2023/03/ap_4_process_fy2024.pdf.
28 World Health Organization (WHO), “WHO Director-General’s Opening Remarks at the Media Briefing on COVID19,” March 11, 2020, https://www.who.int/director-general/speeches/detail/who-director-general-s-opening-remarks-atthe-media-briefing-on-covid-19—11-march-2020.
29 CBO, “Automatic Stabilizers in the Federal Budget: 2022 to 2032,” October 2022, https://www.cbo.gov/publication/
58593. Estimated effect of automatic stabilizers in FY2020 was 1.6% of GDP.
30 For 2020, see CBO, “The Budgetary Effects of Laws Enacted in Response to the 2020 Coronavirus Pandemic, March
and April 2020,” June 2020, https://www.cbo.gov/system/files/2020-06/56403-CBO-covid-legislation.pdf (hereinafter
CBO, “The Budgetary Effects of Laws Enacted in Response to the 2020 Coronavirus Pandemic, March and April
2020”). The total estimated effect on federal deficits from those acts (P.L. 116-123, P.L. 116-127, P.L. 116-136, and
P.L. 116-139) was $2.4 trillion, or 11.5% of GDP.
For 2021, see CBO, “The Budgetary Effects of Major Laws Enacted in Response to the 2020-2021 Coronavirus
Pandemic, December 2020 and March 2021,” September 2021, https://www.cbo.gov/system/files/2021-09/57343Pandemic.pdf (hereinafter CBO, “The Budgetary Effects of Major Laws Enacted in Response to the 2020-2021
Coronavirus Pandemic, December 2020 and March 2021”). The total estimated effect on deficits from those acts (P.L.
116-260, P.L. 117-2) was $2.7 trillion, or 12.2% of GDP.
31 CBO, “The Budgetary Effects of Laws Enacted in Response to the 2020 Coronavirus Pandemic, March and April
2020.”
Congressional Research Service
6
Discretionary Budget Authority by Subfunction: An Overview
The final appropriations package for FY2021, enacted in late December 2020, included an
estimated $185 billion in discretionary spending, $677 billion in mandatory spending, and $5
billion in revenue decreases. The American Rescue Plan Act (P.L. 117-2) provided $1,803 billion
in mandatory funding and $53 billion in revenue reductions, but no discretionary funding.32
Caps on Discretionary Spending Reinstated for FY2024 and FY2025
In June 2023, the Fiscal Responsibility Act (FRA; P.L. 118-5) suspended the federal debt limit
and reestablished statutory caps on discretionary spending for FY2024 and FY2025. Separate
caps apply to the defense and nondefense categories.
Federal Budget Data and Concepts
Figures in this report are based on the Office of Management and Budget (OMB) Public Budget
Database accompanying the FY2025 budget release.33 Table 5.1 in the Historical Tables volume
of the FY2025 budget reports budget authority by function and subfunction, but does not break
down spending into discretionary and mandatory subcomponents.34
OMB Budget Data
OMB’s public budget data generally do not reflect budgetary categories used in the congressional
budget process such as emergency-designated funding, the appropriations subcommittee
responsible for an account, or distinctions between war and base funding. OMB maintains more
detailed budget data for its internal work. OMB is the official source for historical budget data.
CBO estimates, however, are generally more relevant for congressional budget enforcement.
Budget data in OMB documents may differ from other budget data for various reasons, although
differences in historical data are typically small. For example, appropriations budget documents
often reflect scorekeeping adjustments. Budget data issued at a later date may include revisions.
In some cases, detailed appropriations data may differ from OMB data, which sometimes do not
reflect certain relatively small zero-balance transfers among funds. Differences may also reflect
technical differences or different interpretations of federal budget concepts.
Negative Budget Authority
Within the federal budget concepts, certain inflows, such as offsetting receipts, offsetting
collections, some user fees, and “profits” from federal loan programs, are treated as negative
budget authority.35
Provisions in appropriations acts that affect mandatory spending programs, known as CHIMPs
(changes in mandatory programs) can be counted as negative discretionary spending according to
federal budgetary scorekeeping guidelines. For example, a CHIMP affecting the State Children’s
32 CBO, “The Budgetary Effects of Major Laws Enacted in Response to the 2020-2021 Coronavirus Pandemic,
December 2020 and March 2021.”
33 Data in the OMB Public Budget Database (https://www.whitehouse.gov/omb/budget/supplemental-materials/)
reconcile to information presented in the Historical Tables (https://www.whitehouse.gov/omb/budget/historical-tables/)
of the FY2025 budget. For a further description and important caveats, see the Public Budget Database User Guide,
https://www.whitehouse.gov/wp-content/uploads/2024/03/db_guide_fy2025.pdf.
34 OMB, Historical Tables, Table 5.1, https://www.whitehouse.gov/wp-content/uploads/2024/03/hist05z1_fy2025.xlsx.
35 See OMB, FY2025 Budget, Analytic Perspectives, ch. 18, “Offsetting Collections and Offsetting Receipts,”
https://www.whitehouse.gov/wp-content/uploads/2024/03/ap_19_offsetting_fy2025.pdf.
Congressional Research Service
7
Discretionary Budget Authority by Subfunction: An Overview
Health Insurance Program (CHIP) explains a dip in subfunction 551 (health care services) shown
in Figure 9 for FY2025.36
Scorekeeping adjustments, such as CHIMPs, lead to differences between actual discretionary
budget authority totals and limits set by budget enforcement mechanisms, such as §302
allocations or BCA discretionary caps.37 Scored totals of budget authority—that is, totals that
include scorekeeping adjustments and which are used to check conformity to BCA spending
limits and other budget enforcement measures—typically diverge from totals that do not include
those adjustments.
Federal Credit Programs
Disbursements for federal loan and loan guarantee programs do not appear directly in federal
spending data. The federal government has used a form of accrual accounting for loan and loan
guarantee programs since passage of the Federal Credit Reform Act (FCRA; Title V of the
Omnibus Budget Reconciliation Act of 1990; P.L. 101-508) as well as for certain federal
retirement programs.38 OMB calculates net subsidy rates according to FCRA rules for loan and
loan guarantee programs. The net subsidy cost is then reflected in federal spending data. In
general, FCRA adjustments affect mandatory spending more than discretionary spending because
the largest sources of federal credit are mandatory programs.39
Comparisons of estimates of federal credit program costs before and after FY1991 should be
treated with caution because FCRA changed the budgetary treatment of federal credit programs.
For instance, the budgetary costs of loan guarantee programs before FCRA rules came into effect
were typically understated because they required no upfront federal disbursements, unlike loan
programs. Conversely, the budgetary costs of federal loan programs, which required upfront
federal disbursements, did not reflect future repayments. FCRA changes in budgetary treatment of
credit programs made loan and loan guarantee programs more comparable. Loan or loan
guarantee program cost estimates calculated before FCRA implementation are unlikely to be
comparable to estimates calculated afterward.
FCRA calculations sometimes yield negative net subsidy levels, implying that the federal
government appears to make a profit on those loans.40 FCRA subsidy calculations, however, omit
risk adjustments.41 The true economic cost of federal credit guarantees can be substantially
underestimated when risk adjustments are omitted.42
36 OMB, FY2025 Budget, Budget Appendix, CHIP program and financing table, p. 442, https://www.whitehouse.gov/
wp-content/uploads/2024/03/hhs_fy2025.pdf.
37 Section 302 of the 1974 Congressional Budget Act (P.L. 93-344, as amended) defines spending limits for
appropriations subcommittees consistent with levels recommended in a budget resolution. See CRS Report R47388,
Enforceable Spending Allocations in the Congressional Budget Process: 302(a)s and 302(b)s, by Drew C. Aherne.
More precisely, BCA caps were adjusted upward to reflect those spending categories.
38 See CRS Report RL30346, Federal Credit Reform: Implementation of the Changed Budgetary Treatment of Direct
Loans and Loan Guarantees, by James M. Bickley, available to congressional clients upon request.
39 See OMB, FY2025 Budget, Analytic Perspectives, ch. 7, “Credit and Insurance,” https://www.whitehouse.gov/wpcontent/uploads/2024/03/ap_7_credit_fy2025.pdf.
40 For example, in some years Federal Housing Administration mortgage programs and some federal student loan
programs have been estimated to yield negative net subsidies.
41 While the FCRA calculations include estimates of default costs, they do not discount more volatile income flows, as
a private firm would. See CRS Report R44193, Federal Credit Programs: Comparing Fair Value and the Federal
Credit Reform Act (FCRA), by Raj Gnanarajah.
42 U.S. Congressional Budget Office, Estimating the Value of Subsidies for Federal Loans and Loan Guarantees,
August 2004, available at http://cbo.gov/doc.cfm?index=5751.
Congressional Research Service
8
Discretionary Budget Authority by Subfunction: An Overview
Background on Functional Categories
Functional categories are a tool to compare federal funding for activities within broad policy
areas across multiple federal agencies.43 Various federal agencies may have closely related or
overlapping responsibilities. Functional categories therefore provide a useful view of federal
activities supporting specific national purposes.
Superfunction Categories
Superfunction categories, which provide a higher-level division of federal activities, are
•
•
•
•
National Defense,
Human Resources,
Physical Resources, and
Other Functions.
Figure 1 shows trends in discretionary funding for those superfunctions since FY1977. Budget
function categories, grouped by superfunctions, are shown in Table 1. Net Interest, Allowances,
and Undistributed Offsetting Receipts could also be considered as separate categories.
Superfunction categories for National Defense, Net Interest, Allowances, and Undistributed
Offsetting Receipts coincide with function categories. Trends in net interest are excluded, as
federal interest expenditures have been automatically appropriated since 1847.
Figure 1. Discretionary Funding by Budget Superfunction, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
43 See CRS Report 98-280, Functional Categories of the Federal Budget, by Bill Heniff Jr.
Congressional Research Service
9
Discretionary Budget Authority by Subfunction: An Overview
Allowances, which contain items reflecting technical budget adjustments, and undistributed
offsetting receipts are also excluded. Allowances for FY2025 include pandemic fraud prevention
and enforcement, allowances for discretionary programs (nondefense), and proposals for
spectrum relocation.
In this report, the International Affairs function, which OMB includes in the Other Functions
superfunction, is listed after National Defense because similar influences affect both.
Across the broad superfunction categories, discretionary spending is projected to decline as a
share of the economy, measured by gross domestic product (GDP), as shown in Figure 1. After a
buildup in the early 1980s, National Defense funding fell, especially after the collapse of the
Soviet Union and its allied Warsaw Pact. National Defense funding then rose after the attacks of
September 11, 2001, and the wars in Afghanistan and Iraq, but has been falling as a share of GDP
since FY2010. Human Resources funding as a share of GDP fell sharply in the late 1970s and
early 1980s, but rose significantly during the Great Recession and the COVID-19 pandemic.
Funding for Physical Resources also rose during the Great Recession and the COVID-19
pandemic, as well as after major disasters. Funding for Other Functions—comprising Agriculture;
Administration of Justice; General Science, Space, and Technology; and General Government—
has been falling as a share of GDP since FY2010.
Subfunction Categories
Subfunction categories provide a finer division of funding levels within narrower policy areas.44
Budget functions generally play no role in budget enforcement, although budget legislation
mandates that budget resolutions list preferred spending levels by budget function, thus
highlighting broad fiscal priorities.45 Caps on discretionary spending set by BCA and FRA, as
noted above, define the “revised security category” as “discretionary appropriations in budget
function 050.”46
44 Table 1 largely follows the ordering of functions in the OMB Historical Tables volume. See OMB, FY2025 Budget,
Historical Tables, Table 3.1, https://www.whitehouse.gov/wp-content/uploads/2024/03/hist03z1_fy2025.xlsx. The
ordering of some items was changed to organize the discussion in a thematically consistent manner. As noted in the
text, the international affairs function was grouped with the national defense function, as those categories are affected
by common influences.
45 2 U.S.C. 632(a)(4).
46 2 U.S.C. 900(c)(4)(D).
Congressional Research Service
10
Discretionary Budget Authority by Subfunction: An Overview
Table 1. Budget Function Categories by Superfunction
Superfunction
Code
Function / Subfunction
National Defense
International Affairs
50
51
53
54
150
151
152
153
154
155
National defense
Dept. of Defense-Military
Atomic Energy Defense Activities
Defense-Related Activities
International affairs
Intl. Dev. and Humanitarian Assistance
Intl. Security Assistance
Conduct of Foreign Affairs
Foreign Information & Exchange Activities
International Financial Programs
500
501
502
503
504
505
506
550
551
552
554
570
571
600
601
602
603
604
605
609
650
651
700
701
702
703
704
705
Education, training, employment, and social services
Elementary, Secondary, and Vocational Education
Higher Education
Research and General Education Aids
Training and Employment
Other Labor Services
Social services
Health
Health Care Services
Health Research and Training
Consumer and Occupational Health and Safety
Medicare
Medicare
Income security
Gen. retirement & disability insurance (exc. Soc. Sec.)
Federal employee retirement and disability
Unemployment compensation
Housing assistance
Food and nutrition assistance
Other income security
Social security
Social security
Veterans’ benefits and services
Income security for veterans
Veterans education, training, & rehabilitation
Hospital and medical care for veterans
Veterans housing
Other veterans’ benefits and services
270
271
272
274
276
Energy
Energy supply
Energy conservation
Emergency energy preparedness
Energy information, policy, and regulation
Human Resources
Physical Resources
Congressional Research Service
11
Discretionary Budget Authority by Subfunction: An Overview
Superfunction
Code
Function / Subfunction
300
301
302
303
304
306
370
371
372
373
376
400
401
402
403
407
450
451
452
453
Natural resources and environment
Water resources
Conservation and land management
Recreational resources
Pollution control and abatement
Other natural resources
Commerce and housing credit
Mortgage credit
Postal service
Deposit insurance
Other advancement of commerce
Transportation
Ground transportation
Air transportation
Water transportation
Other transportation
Community and regional development
Community development
Area and regional development
Disaster relief and insurance
250
251
252
350
351
352
750
751
752
753
754
800
801
802
803
804
805
806
808
809
General science, space, and technology
General science and basic research
Space flight, research & supporting activities
Agriculture
Farm income stabilization
Agricultural research and services
Administration of justice
Federal law enforcement activities
Federal litigative and judicial activities
Federal correctional activities
Criminal justice assistance
General government
Legislative functions
Executive direction and mgmt.
Central fiscal operations
General property and records mgmt.
Central personnel mgmt.
General purpose fiscal assistance
Other general government
Deductions for offsetting receipts
900
901
902
903
908
Net interest
Interest on Treasury debt securities (gross)
Interest received by on-budget trust funds
Interest received by off-budget trust funds
Other interest
Other Functions
Net Interest
Congressional Research Service
12
Discretionary Budget Authority by Subfunction: An Overview
Superfunction
Code
909
Function / Subfunction
Other Investment and income
Allowances
920
922
Undistributed Offsetting
Receipts
Allowances
Reductions for Joint Committee Enforcement (Nondefense)
923
Pandemic Fraud Prevention and Enforcement
924
Allowance for Discretionary Programs (Nondefense)
926
Spectrum Relocation
950
951
952
953
954
959
Undistributed offsetting receipts
Employer share, employee retirement (on-budget)
Employer share, employee retirement (off-budget)
Rents & royalties on the Outer Continental Shelf
Sale of major assets
Other undistributed offsetting receipts
Source: CRS, based on OMB data (OMB, FY2025 Budget, Analytical Perspectives, Table 25-1,
https://www.whitehouse.gov/wp-content/uploads/2024/03/25-1_fy2025.xlsx).
Notes: Allowances subfunctions can change from one year to the next.
Historical Spending Trends
Federal spending trends in functional areas are affected by changing assessments of national
priorities, evolving international challenges, and economic conditions, as well as changing social
characteristics and demographics of the U.S. population. Some of the trends and events that have
had dramatic effects on federal spending are outlined below. Other CRS products provide
background on more specific policy areas. The discussion of budgetary trends is broken up into
three broad categories: defense and international affairs, domestic social programs, and other
federal programs.
Spending in the following figures, as noted above, is shown as a percentage of GDP, which
controls for the effects of inflation, population growth, and real income growth. A flat line on
such graphs indicates that spending in that category is increasing at the same rate as overall
economic growth.
Defense and International Affairs
The National Defense (050) and International Affairs (150) budget functions have been the
categories most affected by larger changes in the geopolitical role of the United States.
Cold War, Peace Dividend, and the Global War on Terror
The allocation of discretionary spending between defense and nondefense programs is one
reflection of changing federal priorities over time. Figure 2 shows defense and nondefense
discretionary funding as a percentage of GDP. Figure 3 shows defense spending by major title,
Congressional Research Service
13
Discretionary Budget Authority by Subfunction: An Overview
including Military Personnel (Mil Pers), Procurement, Operations and Maintenance (O&M), and
Research, Development, Test, and Evaluation (RTD&E).47
Figure 2. Discretionary Defense and Nondefense Spending
Budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: Defense is defined as funding for the National Defense (050) budget function; nondefense is the
remainder. FY1976-FY2023 are historical data; FY2024 is estimated; FY2024-FY2029 reflect the President’s
FY2018 budget proposals. The spikes in nondefense funding in FY2009 and FY2020 reflect enactment of the
Recovery Act (ARRA) and legislative responses to the COVID-19 pandemic, which are discussed elsewhere.
Relations between the United States and its allies on one hand, and the Union of Soviet Socialist
Republics (USSR) and its allies on the other were the dominant security concern in the half
century following the Second World War. In the early 1970s, U.S. involvement in the Vietnam
War wound down, while the United States and the USSR moved toward detente, permitting a
thaw in Cold War relations between the two superpowers and a reduction in defense spending
relative to the size of the economy.48
47 Defense appropriations acts typically also contain titles for Revolving and Management Funds, Other DOD
Programs, and Related Agencies. Military Construction/Veterans Administration appropriations acts typically contain
titles for Military Construction and Family Housing.
48 For histories of deficit finance and American wars, see Robert D. Hormats, The Price of Liberty, (New York: Times,
2007); or Steven A. Bank, Kirk J. Stark, and Joseph J. Thorndike, War and Taxes, (Washington, DC: Urban Institute,
2008). Also see Rosella Cappella Zielinski, How States Pay for Wars (New York: Cornell University Press, 2016); and
Sarah Kreps, Taxing Wars: The American Way of War Finance and the Decline of Democracy (Oxford, 2018).
Congressional Research Service
14
Discretionary Budget Authority by Subfunction: An Overview
Figure 3. Defense Discretionary BA by Major Title, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: The five titles with the highest funding levels are shown.
In 1979, during the Jimmy Carter Administration, military spending increased sharply following
intervention by the USSR in Afghanistan and the Iranian hostage crisis.49 The Ronald W. Reagan
Administration increased defense spending further, with procurement costs rising more sharply
than other categories.50
Defense spending continued to increase until 1986, as concern shifted to domestic priorities, the
desire to reduce large budget deficits, and concerns about inflated procurement costs.51 The
collapse in 1989 of most of the Warsaw Pact governments in Central and Eastern Europe and the
1990-1991 disintegration of the Soviet Union was followed by a reduction in federal defense
spending, allowing a “peace dividend” that relaxed fiscal pressures.52 O&M costs, however, fell
more slowly after the mid-1980s than other costs (as seen in Figure 3) and rose more quickly
after 2000.
The attacks of September 11, 2001, were followed by sharp increases in homeland security
spending. Defense spending also increased significantly with the start of the Afghanistan war in
49 For one view of budgetary politics in the early 1980s, see David Stockman, The Triumph of Politics (New York:
Harper & Row, 1986). Also see James M. Poterba, David Stockman, and Charles Schultze, “Budget Policy,” in
American Economic Policy in the 1980s, NBER, pp. 235-292.
50 Stockman (1986), pp. 105-109.
51 Airon A. Mothershed, “The $435 Hammer and $600 Toilet Seat Scandals: Does Media Coverage of Procurement
Scandals Lead to Procurement Reform?” Public Contract Law Journal, vol. 41, no. 4 (2012), pp. 855-880,
http://www.jstor.org/stable/41635361.
52 The Warsaw Treaty Organization established in 1955, included Albania, Bulgaria, Czechoslovakia, the German
Democratic Republic, Hungary, Poland, Romania, and the Soviet Union.
Congressional Research Service
15
Discretionary Budget Authority by Subfunction: An Overview
October 2001 and the Iraq war in March 2003.53 Rising levels of violence and instability in Iraq
in 2006 led President George W. Bush to send an additional “surge” of troops.54 In 2008, the U.S.
and Afghan governments negotiated a Status of Forces Agreement (SOFA) that set a December
2011 deadline for the withdrawal of most U.S. combat troops.55 A smaller number of U.S. troops
returned in 2014 to combat the Islamic State of Iraq and Syria (ISIS).56
President Barack H. Obama announced that additional troops would be sent to Afghanistan to
prevent a collapse of its government. In 2013 and 2014, President Obama stated that most U.S.
troops would be withdrawn from Afghanistan by the end of 2014.57 In November 2014, however,
President Obama announced an extension of operations in Afghanistan.58 In February 2020, the
Trump Administration signed an agreement with the Taliban that set a May 2021 deadline for the
withdrawal of U.S. military forces.59 The collapse of Afghan forces in August 2021 forced the
withdrawal of remaining U.S. personnel.60
The invasion of Ukraine’s Crimean peninsula and eastern portions of Ukraine in March 2014
marked a turning point in U.S.-Russian relations, although those events had no material effect on
defense spending.61 The full-scale Russian invasion of Ukraine in February 2022, however,
prompted a more robust response. By the end of December 2023, the United States had provided
at least $47 billion in security aid since the initial 2014 Russian invasion of Ukraine.62 In October
2023, the Biden Administration requested $58 billion in supplemental appropriations to support
Ukraine and Israel, which appears as a FY2024 uptick for the Defense-Military category in
53 See archived CRS Report RL33110, The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations
Since 9/11, by Amy Belasco, available to congressional clients upon request. The Afghan and Iraq wars, along with
other related activities, were often called the Global War on Terror (GWOT) and later Overseas Contingency
Operations (OCO). The OCO category was created in 1997 to fund activities in Kosovo and Southwest Asia. See DOD
Comptroller, “Overseas Contingency Operations Transfer Fund,” in the FY2000 DOD Budget Justification,
https://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2000/budget_justification/pdfs/
01_Operation_and_Maintenance/fy00pb_ocotf.pdf. Also see CRS In Focus IF10143, Foreign Affairs Overseas
Contingency Operations (OCO) Funding: Background and Current Status, by Emily M. McCabe.
54 White House, “President’s Address to the Nation,” January 10, 2007, https://georgewbush-whitehouse.archives.gov/
news/releases/2007/01/20070110-7.html. Also see Timothy A. Sayle et al., The Last Card: Inside George W. Bush’s
Decision to Surge in Iraq, (Ithaca, NY: Cornell Univ. Press, 2019), https://www.jstor.org/stable/10.7591/j.ctvfc522t.
55 See archived CRS Report R40011, U.S.-Iraq Withdrawal/Status of Forces Agreement: Issues for Congressional
Oversight, by R. Chuck Mason, available to congressional clients upon request.
56 Stacie L. Pettyjohn, “Can Iraq Evict U.S. Forces?” January 6, 2020, https://www.rand.org/blog/2020/01/can-iraqevict-us-forces.html.
57 See CRS Report RL30588, Afghanistan: Post-Taliban Governance, Security, and U.S. Policy, by Kenneth Katzman.
Also see Kevin Marsh, “Obama’s Surge: A Bureaucratic Politics Analysis of the Decision to Order a Troop Surge in
the Afghanistan War,” Foreign Policy Analysis, vol. 10, no. 3 (July 2014), pp. 265-288.
58 Mark Mazzetti and Eric Schmitt, “In a Shift, Obama Extends U.S. Role in Afghan Combat,” New York Times,
November 21, 2014.
59 U.S. Department of State, After Action Review on Afghanistan: January 2020-August 2021, June 30, 2023, p. 11,
https://www.state.gov/wp-content/uploads/2023/06/State-AAR-AFG.pdf.
60 Ibid., p. 85.
61 Katya Gorchinskaya, “A Brief History of Corruption in Ukraine: the Yanukovych Era,” Eurasianet, June 3, 2020,
https://eurasianet.org/a-brief-history-of-corruption-in-ukraine-the-yanukovych-era. Also see Serhiy Kudelia, “The
House that Yanukovych Built: the Maidan and Beyond,” Journal of Democracy, vol. 25 (2014).
62 See CRS In Focus IF12040, U.S. Security Assistance to Ukraine, by Christina L. Arabia, Andrew S. Bowen, and
Cory Welt.
Congressional Research Service
16
Discretionary Budget Authority by Subfunction: An Overview
Figure 3.63 In February 2024, the Senate agreed to a related measure (S.Amdt. 1388 to H.R.
815).64
Potential security and diplomatic challenges posed by the Peoples’ Republic of China (PRC) have
emerged as a leading strategic concern.65 Other strategic priorities include broader challenges
such as climate change and terrorism, as well as shaping international rules that address potential
policy disputes over trade and technology.66
Defense Funding Outside of the Department of Defense
Figure 4 shows subfunctions within the National Defense (050) budget function. The Department
of Defense (DOD)-Military (051) subfunction accounts for over 95% of that funding. Almost all
of the Atomic Energy Defense Activities (053) subfunction supports operations within the U.S.
Department of Energy (DOE). About two-thirds of that funding supports the National Nuclear
Security Administration (NNSA) and the remainder funds environmental clean-up of weapons
production and research sites, along with other related activities. Much smaller amounts support
the Defense Nuclear Facilities Safety Board and site remediation activities of the U.S. Army
Corps of Engineers.
The Defense-Related Activities (54) subfunction comprises a variety of activities outside of
DOD. In recent years, funding for counterterrorism activities within the Federal Bureau of
Investigation (FBI) has accounted for almost two-thirds of all funding within this subfunction and
about half of the FBI’s total discretionary funding.
63 CRS Insight IN12274, FY2024 Emergency Supplemental Funding Request: Defense Appropriations, by Cameron M.
Keys and Luke A. Nicastro. Also see Biden Administration, letter to Congress, October 20, 2023,
https://www.whitehouse.gov/wp-content/uploads/2023/10/Letter-regarding-critical-national-security-funding-needsfor-FY-2024.pdf.
64 CBO, Cost Estimate of Senate Amendment 1388 to H.R. 815, the National Security Act, 2024, February 8, 2024,
https://www.cbo.gov/system/files/2024-02/
CBO_Estimate_for_Div_A_of_SA_1388_to_HR815_National_Security_Act_2024.pdf.
65 OMB, Budget of the U.S. Government FY2024, p. 63, https://www.whitehouse.gov/wp-content/uploads/2023/03/
budget_fy2024.pdf. “…the Budget prioritizes China as America’s pacing challenge in line with the 2022 National
Defense Strategy.”
66 See CRS Report R47582, FY2024 Defense Budget Request: Context and Selected Issues for Congress, by Cameron
M. Keys and Brendan W. McGarry.
Congressional Research Service
17
Discretionary Budget Authority by Subfunction: An Overview
Figure 4. National Defense (050) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
International Affairs
Figure 5 shows levels of budget authority allocated to international affairs (budget function 150)
as a share of GDP. Spending for activities within the international affairs budget function has
fluctuated in response to changes in U.S. foreign policy and national security and economic
priorities.
International Security Assistance rose sharply in the late 1970s and early 1980s, in large part due
to foreign military financing support provided to Israel and Egypt following the 1979 Camp
David Accords.67 The Economic Support Fund (ESF), which provides financial support to
promote political and socioeconomic stability within a range of countries of strategic importance
to the United States, also grew rapidly in the same time period.68 Funding for security assistance
fell after the collapse of the Warsaw Pact governments in 1989 and the dissolution of the Soviet
Union in 1991.
67 U.S. General Accounting Office (now Government Accountability Office; GAO), Military Sales to Israel and Egypt:
DOD Needs Stronger Controls Over U.S.-Financed Procurements, GAO/NSIAD-93-184, July 1993,
http://www.gao.gov/assets/160/153579.pdf.
68 For more on U.S. foreign assistance history and trends, see CRS Report R40213, Foreign Assistance: An
Introduction to U.S. Programs and Policy, by Emily M. McCabe and Nick M. Brown.
Congressional Research Service
18
Discretionary Budget Authority by Subfunction: An Overview
Figure 5. International Affairs (150) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
The level of funding for International Development and Humanitarian Assistance fell from about
0.2% of GDP in the late 1970s to less than 0.1% of GDP in the 1990s. The George W. Bush
Administration increased funding for International Development and Humanitarian Assistance in
the early 2000s through initiatives such as the President’s Emergency Plan for AIDS Relief
(PEPFAR), which has supported programs to stem the spread of AIDS and HIV in sub-Saharan
Africa and South Asia, and creation of the Millennium Challenge Corporation (MCC), which
seeks to spur economic growth in relatively well-governed developing countries.69 During the
Obama Administration, funding for International Development and Humanitarian Assistance
hovered around 0.15% of GDP, about midway between levels seen in the 1970s and in the 1990s.
More recently, largely as a result of U.S. responses to the COVID-19 pandemic starting in 2020
and Russia’s renewed invasion of Ukraine in 2022, International Development and Humanitarian
Assistance has risen. In 2022, International Development and Humanitarian Assistance as a share
of GDP peaked at more than 0.18%, a level last seen around 2009.
Costs of conducting foreign affairs, relative to GDP, rose during the first decade of the wars in
Afghanistan and Iraq, but largely declined between FY2012 and FY2019. Following the
declaration of the COVID-19 pandemic in 2020, the U.S. withdrawal from Afghanistan in 2021,
and Russia’s renewed invasion of Ukraine in 2022, Function 150 relative to GDP has increased.
Heightened concerns over security of diplomatic facilities and personnel have also contributed to
overall higher funding levels since 2001.
69 See CRS Report RL32427, Millennium Challenge Corporation: Overview and Issues, by Nick M. Brown.
Congressional Research Service
19
Discretionary Budget Authority by Subfunction: An Overview
Upticks in the International Financial Programs subfunction before FY2000 reflect funds
provided by the U.S. government to the International Monetary Fund. In exchange for those
funds, the U.S. government receives Special Drawing Rights (SDRs).70 Steadier International
Financial Program funding after FY2000 appears to reflect changes in budget scoring treatment
of those transactions. CBO has argued that a market-based assessment of U.S. government
commitments to the IMF should include a material risk adjustment.71 The U.S. Treasury objected
to CBO’s analysis and contends that those transactions should be treated as an exchange of assets
with no budgetary cost.72 For that reason OMB does not score those transactions as BA or
outlays.73
Domestic Social Programs
This section discusses budgetary trends among domestic social programs. Figure 6 shows
discretionary funding trends for budget functions within the Human Resources superfunction.
Figure 6. Discretionary Funding for Human Resources Functions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
70 CRS In Focus IF11835, International Monetary Fund: Special Drawing Rights Allocation, by Martin A. Weiss and
Rebecca M. Nelson.
71 CBO, The Budgetary Effects of the United States’ Participation in the International Monetary Fund, June 16, 2016,
https://www.cbo.gov/publication/51663.
72 U.S. Treasury, Response to CBO Report on the Budgetary Effects of U.S. Participation in the IMF, January 2017,
https://home.treasury.gov/system/files/206/US-Treasury-Response-to-CBO-Report-on-IMF-Budget-Scoring-January2017.pdf.
73 OMB, FY2025 Budget, Analytical Perspectives, ch. 4, pp. 40-41, https://www.whitehouse.gov/wp-content/uploads/
2024/03/ap_4_process_fy2025.pdf.
Congressional Research Service
20
Discretionary Budget Authority by Subfunction: An Overview
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
In the past two decades, federal responses to the attacks of September 11, 2001, the 2007-2009
financial crisis and ensuing Great Recession, and the COVID-19 pandemic have had the most
prominent effects of spending trends for most categories of federal domestic spending.
Nondefense Security and Nonsecurity Spending Diverge After 9/11
Domestic spending (i.e., nondefense spending excluding international affairs) increased after the
attacks of September 11, 2001, after having fallen for much of the 1990s. Most of that increase in
domestic spending occurred in areas related to nondefense security spending, as the federal
government overhauled airport security procedures, and then established the Department of
Homeland Security. Since 2001, several definitions of “security spending” have been used, most
recently in the 2011 Budget Control Act (BCA).74 Figure 7 shows funding trends divided by BCA
security and nonsecurity categories.
Figure 7. Security and Nonsecurity Funding Trends
Budget Authority as a Percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: BCA security and nonsecurity categories used, except that war funding, certain program integrity funds,
and emergency supplemental funding are included. The BCA security category included funding for the
74 The Obama Administration defined security spending in its FY2012 budget as funding for Department of Defense-
Military (subfunction 051); the Department of Energy’s National Nuclear Security Administration; International
Affairs (function 150, which includes State Department and related agencies); the Department of Homeland Security;
and the Department of Veterans Affairs. The BCA defined security similarly, except that it included all military
activities within the Department of Defense excluding war funding (i.e., defined by department rather than by
subfunction), and also included the Intelligence Community Management Account.
Congressional Research Service
21
Discretionary Budget Authority by Subfunction: An Overview
Departments of Defense, Homeland Security, Veterans Affairs, the National Nuclear Security Administration, the
intelligence community management account, and all budget accounts in the International Affairs budget function
(150). FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections. See
OMB budget documents for further caveats.
The Recovery Act
After the financial crisis of 2007-2008 plunged the United States into the deepest economic
recession in decades, Congress passed the American Recovery and Reinvestment Act of 2009
(P.L. 111-5; ARRA), often known as the Recovery Act. ARRA includes support for state and
local governments, as well as tax cuts and rebates among other provisions.75 According to initial
CBO estimates, ARRA provisions were expected to total $787.2 billion in increased spending and
reduced taxes over the FY2009-FY2019 period or just over 5% of GDP in 2008, while a more
recent CBO estimate put the total at $814 billion.76 The effects of Recovery Act spending can be
seen in most of the figures shown below.
Since 2010, however, total nondefense discretionary spending has declined in real (i.e., inflationadjusted) terms.77 Nondefense discretionary spending as a share of the economy been has
declining more rapidly. Although economic growth has been on average slower than in some
previous decades, most components of federal spending have grown even more slowly. Funding
trends for most budget categories since FY2010 have been less volatile than in past decades.
Education, Training, Employment, and Social Services
Figure 8 shows spending trends for subfunctions within the Education, Training, Employment,
and Social Services budget function.
Federal support for employment and training programs generally declined as a share of GDP
between 1977 and 2023, the period depicted in Figure 8. The initial higher levels of funding
largely reflect public service employment efforts under the Comprehensive Employment and
Training Act (CETA; P.L. 93-203), which addressed high levels of unemployment following the
first oil shock of 1973. The Job Training Partnership Act of 1982 (P.L. 97-300), enacted during
the 1981-1982 recession, replaced CETA. After 1984, discretionary funding has declined as a
share of GDP. Under subsequent workforce development statutes, the Workforce Investment Act
of 1998 (P.L. 105-220) and the Workforce Innovation and Opportunity Act of 2014 (P.L. 113128), training and employment funding as a share of GDP continued to decline.78
75 For more information on the provisions of ARRA, see CRS Report R40537, American Recovery and Reinvestment
Act of 2009 (P.L. 111-5): Summary and Legislative History, by Clinton T. Brass et al.
76 For initial estimates, see U.S. Congressional Budget Office, Cost Estimate For the Conference Agreement For H.R.
1, February 13, 2009, available at http://cbo.gov/ftpdocs/99xx/doc9989/hr1conference.pdf. For a later assessment, see
CBO, Budget and Economic Outlook: An Update, August 2010, Box 1-2, available at http://www.cbo.gov/ftpdocs/
117xx/doc11705/08-18-Update.pdf.
77 See OMB, The Budget for FY2025, Historical Tables, Table 8.2, https://www.whitehouse.gov/wp-content/uploads/
2024/03/hist08z2_fy2025.xlsx.
78 See CRS Report R44252, The Workforce Innovation and Opportunity Act and the One-Stop Delivery System for
historical background.
Congressional Research Service
22
Discretionary Budget Authority by Subfunction: An Overview
Figure 8. Education,Training, Employment, and Social Services (500) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
Federal support for elementary and secondary education increased sharply following the
reauthorization of the Elementary and Secondary Education Act (ESEA) by the No Child Left
Behind Act of 2001 (NCLB; P.L. 107-110). Funding for most subfunctions within the budget
function, including elementary, secondary, and higher education, rose sharply with enactment of
ARRA and other legislative responses to the Great Recession of 2007-2009. Funding levels for
education as measured as a percentage of GDP tapered off until 2020 with the enactment of
discretionary funding for federal education programs in response to the COVID-19 pandemic
through the Coronavirus Aid, Relief, and Economic Security Act (CARES Act; P.L. 116-136).
The majority of CARES Act education-focused funds were provided through the Education
Stabilization Fund (ESF). Additional discretionary funding was provided for the ESF and ESF
programs in response to the COVID-19 pandemic through the Coronavirus Response and Relief
Supplemental Appropriations Act, 2021 (CRRSAA; Division M of the Consolidated
Appropriations Act, 2021; P.L. 116-260). Finally, the largest tranches of pandemic-related funding
for ESF programs were provided through mandatory funding included in the American Rescue
Plan Act of 2021 (ARPA; P.L. 117-2).79 Since 2021, discretionary funding levels for elementary
and secondary education—measured as a percentage of GDP—have attenuated.
79 Approximately one-quarter of the discretionary and mandatory funds provided for the ESF and ESF programs was
dedicated to higher education; OMB attributed all of such funds to the elementary and secondary education
subfunction. For more information about discretionary and mandatory funding provided to support elementary,
secondary, and higher education during the COVID-19 pandemic, see CRS Report R47027, Education Stabilization
Fund Programs Funded by the CARES Act, CRRSAA, and ARPA: Background and Analysis.
Congressional Research Service
23
Discretionary Budget Authority by Subfunction: An Overview
Federal Health Programs
Costs of federal health programs continue to play a central role in budgetary discussions. Total
federal costs of the largest federal health care programs such as Medicare and Medicaid, however,
are nearly all supported by mandatory spending and are thus not discussed here. Administrative
costs for those programs, which account for a small portion of those costs, are generally funded
by discretionary spending. Many other federal health programs, such as federal support for health
research, public health programs, and veterans’ health care, are mostly funded through
discretionary spending. Figure 9 shows trends in discretionary funding within the Health (550)
and Medicare (570) budget functions since FY1977. Several discretionary health subfunctions
saw substantial increases during the COVID-19 pandemic.
The trajectory of funding for the hospital and medical care for veterans subfunction, which falls
under another budget function and is also shown in Figure 12, is included for the sake of
comparison. Veterans’ health care spending as a percentage of GDP has increased since 2009 due
to community care, mental health, and suicide prevention reforms that have increased overall
spending. The veterans’ health care budget subfunction also saw one-time increases during the
COVID-19 pandemic in 2020 and 2021.80
Figure 9. Federal Health Programs
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
80 See CRS Report R45390, VA Maintaining Internal Systems and Strengthening Integrated Outside Networks Act of
2018 (VA MISSION Act; P.L.115-182); CRS Report R46848, Commander John Scott Hannon Veterans Mental Health
Care Improvement Act of 2019 (P.L. 116-171) and Veterans COMPACT Act of 2020 (P.L. 116-214); CRS Report
R46340, Federal Response to COVID-19: Department of Veterans Affairs; CRS Report R46459, Department of
Veterans Affairs FY2021 Appropriations; and CRS Report R46964, Department of Veterans Affairs FY2022
Appropriations.
Congressional Research Service
24
Discretionary Budget Authority by Subfunction: An Overview
Discretionary funding within the health care services (551) subfunction supports activities and
programs administered by the Centers for Disease Control and Prevention (CDC), the Health
Resources and Services Administration, the Substance Abuse and Mental Health Services
Administration (SAMSA), and the Indian Health Service (IHS), among other health-related
agencies. From the mid-1980s through FY2001, funding within the health care services
subfunction doubled. Since then, funding trends have been more volatile. This budget subfunction
has seen spikes during public health emergencies and from other one-time funding.81 The large
spike during 2020-2021 reflected the substantial and unprecedented spending for the health
response to the COVID-19 pandemic.82 The downtick in FY2025 reflects proposed funding
restrictions or reductions in the Children’s Health Insurance Fund and the Child Enrollment
Contingency Fund.83
The National Institutes of Health (NIH) accounts for most of the health research and training
(552) subfunction. Discretionary funding within the health research and training subfunction has
usually exceeded discretionary funding for the health care services subfunction, except during the
COVID-19 pandemic. After funding in the health research and training subfunction failed to keep
up with the rate of GDP growth in the late 1970s and early 1980s, funding grew steadily as a
percentage of GDP for the next 20 years. In the late 1990s, policymakers decided to double the
NIH budget within a five-year period, from FY1999 to FY2003.84 From FY2003 to FY2016,
however, funding as a percentage of GDP generally fell, with the exception of increased funding
provided through ARRA in FY2009.85 From FY2016 to FY2023, NIH has seen relatively modest
funding increases each year with a spike during the COVID-19 pandemic.86
Discretionary funding for Medicare (subfunction 571), which, as noted above, mostly funds
administrative costs, and the consumer and occupational health and safety (554) subfunction,
which includes U.S. Food and Drug Administration (FDA) spending, has been relatively stable
over time. Each has remained at about 0.03% to 0.04% of GDP over the period. Total FDA
spending increased over the period covered, but budget authority provided through the annual
appropriations from the Treasury general fund has been offset by user fees collected by the
agency.87
Income Security
The bulk of federal funding for income security programs is provided through mandatory
spending. In general, discretionary spending—outside of housing assistance—funds
administrative costs of those programs. Housing assistance programs, unlike most other income
security programs, are largely supported by discretionary funding. Figure 10 shows trends in the
Income Security (600) budget function.
The largest changes within the Income Security budget function reflect shifts in the structure and
funding levels for programs within the housing assistance (604) subfunction in the 1970s and
81 The 2009 spike was linked to spending in response to the 2009 H1N1 influenza pandemic (P.L. 111-32) as well as
one-time health investments in the American Recovery and Reinvestment Act of 2009 (P.L. 110-5).
82 See CRS Report R46711, U.S. Public Health Service: COVID-19 Supplemental Appropriations in the 116th
Congress.
83 OMB, FY2025 Budget, Budget Appendix, pp. 422-424, https://www.whitehouse.gov/wp-content/uploads/2024/03/
hhs_fy2025.pdf.
84 See CRS Report R43341, National Institutes of Health (NIH) Funding: FY1996-FY2024.
85 P.L. 110-5.
86 See CRS Report R43341, National Institutes of Health (NIH) Funding: FY1996-FY2024.
87 See CRS Report R44576, The Food and Drug Administration (FDA) Budget: Fact Sheet.
Congressional Research Service
25
Discretionary Budget Authority by Subfunction: An Overview
early 1980s.88 Federal support for affordable housing shifted from supporting up-front long-term
funding for construction of publicly subsidized units toward annual funding for rent subsidies for
low-income households to use in existing housing and block grants to local governments over the
time period in question.89 Since the late 1970s, the share of BA for housing assistance has
fluctuated, driven by the creation of new programs and activities, as well as rescissions of
recaptured unobligated balances. Housing assistance’s share of GDP, however, has remained at
less than a quarter of what it was at its peak. Legislative responses to the Great Recession of
2007-2009 led to increased funding for various housing programs in FY2009. Discretionary
funding for tenant rental and homeless assistance increased modestly in FY2020.
Discretionary funding for other income security subfunctions generally remained below 0.1% of
GDP until FY2020. Responses to the COVID-19 pandemic increased funding for some programs,
such as for the Child Care and Development Block Grant, although increases in mandatory
spending were larger.90
Figure 10. Income Security (600) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: Most income security benefits, aside from housing assistance, are generally funded by mandatory
spending, which is not shown here. FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration
proposals and projections. See OMB budget documents for further caveats.
88 See The Reagan Record, eds., John L. Palmer and Isabel V. Sawhill, (Washington, DC: Urban Institute, 1984),
Appendix C, pp. 372-373.
89 Katherine M. O'Regan and John M. Quigley, “Federal Policy and the Rise of Nonprofit Housing Providers,” Journal
of Housing Research, vol. 11, no. 2 (2000), pp. 301-302. Also see Charles L. Edson, “Affordable Housing—An
Intimate History,” Journal of Affordable Housing and Community Development, vol. 20 (winter 2011), pp. 193-213.
90 See CRS Report R47312, The Child Care and Development Block Grant: In Brief, by Karen E. Lynch.
Congressional Research Service
26
Discretionary Budget Authority by Subfunction: An Overview
Social Security
Discretionary funding for Social Security, depicted in Figure 11, supports program
administration. Social Security benefits are generally funded by mandatory spending. Program
administration costs supported by discretionary funding are a small fraction of mandatory benefit
amounts. Those costs, which increased in nominal dollar terms in most years, grew more slowly
than the rate of economic growth. Over time, the composition of those costs evolved. In the
1970s, costs of administrating Old-Age and Survivors Insurance (OASI) benefits were nearly
three times as large as those for Disability Insurance (DI) benefits. Since FY2012, costs of
administering DI benefits, however, have exceeded costs of administering OASI benefits.
Figure 11. Social Security (650) Subfunction
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
Veterans’ Benefits and Services
The Department of Veterans Affairs (VA) provides a range of benefits and services to veterans
who meet certain eligibility criteria.91 These benefits and services include, among other things,
hospital and medical care; disability compensation and pensions; education; veteran readiness and
employment (VR&E); assistance to homeless veterans; home loan guarantees; administration of
91 For details on basic criteria, including the statutory definition of “veteran,” see CRS Report R47299, U.S.
Department of Veterans Affairs: Who Is a Veteran?
Congressional Research Service
27
Discretionary Budget Authority by Subfunction: An Overview
life insurance, as well as traumatic injury protection insurance for servicemembers; and death
benefits that cover burial expenses.92
Health care provided through VA’s Veterans Health Administration (VHA) accounts for a majority
(about 90%) of discretionary funding within the Veterans’ Benefits and Services (700) budget
function.93 For instance, in FY2023 VA’s total discretionary funding was $134.72 billion, and
VHA accounted for $119.66 billion.94 Departmental administration, information technology, and
smaller discretionary programs account for the remainder.95 Veterans’ income security programs,
such as disability compensation, pensions, and readjustment benefits (such as education), are
generally supported by mandatory spending. Essentially all discretionary spending within the
veterans’ benefits and services subfunction supports general operating expenses for administering
disability compensation and readjustment benefits and services. Figure 12 shows trends in
discretionary funding for the veterans’ benefits and services budget function since FY1977.
The Hospital and Medical Care for Veterans (703) subfunction, as noted above, accounts for the
bulk of funding with the veterans’ benefits and services budget function. Since 2001, veterans’
health care costs have been one of the fastest-growing components of discretionary spending.
Three major trends have affected spending on veterans’ health care. These could be characterized
as demographics, health care trends such as demand for care and reliance on VHA health services,
and legislative changes expanding services. First, the total number of veterans has been
decreasing. From 2009 to 2023, the number of World War II, Korean War, and Vietnam War
veterans dropped from 12 million to 6 million.96 Despite the decline in the overall veteran
population, the number of veterans enrolled in the VA health care system has increased. The share
of the veteran population enrolled in the health care system grew from 18.4% in FY2000 to 50%
in FY2023. Additionally, the veteran population is generally older than the overall U.S.
population, and veterans over the age of 65 are driving growth in long-term care services such as
nursing home care and assisted living.97 Currently, newer veterans from Operation Enduring
Freedom (OEF)/Operation Iraqi Freedom (OIF)/Operation New Dawn (OND)/Operation Inherent
92 For more information on health care programs, see CRS Report R42747, Health Care for Veterans: Answers to
Frequently Asked Questions. For more information on disability benefit programs, see CRS Report R44837, Benefits
for Service-Disabled Veterans; and CRS Report R47163, Department of Veterans Affairs: Claims Process and
Compensation and Pension Exams by Contracted Physicians. For information on pension programs, see CRS Report
R46511, Veterans Benefits Administration (VBA): Pension Programs. For a discussion of education benefits, see CRS
Report R42785, Veterans’ Educational Assistance Programs and Benefits: A Primer. For details on VA’s vocational
rehabilitation and employment, see CRS Report RL34627, Veterans’ Benefits: The Veteran Readiness and Employment
Program. For detailed information on homeless veterans programs, see CRS Report RL34024, Veterans and
Homelessness. For more information on burial benefits, see CRS Report R41386, Veterans’ Benefits: Burial Benefits
and National Cemeteries.
93 Aside from medical care (which comprises medical services, medical community care, medical support and
compliance, and medical facilities accounts) and medical research, discretionary funding for veterans’ programs
supports construction programs, information technology, Electronic Health Care Record Modernization (EHRM), the
Office of Inspector General, the Board of Veterans Appeals, the National Cemetery Administration, and general
operating expenses. See CRS Report R47423, Department of Veterans Affairs FY2023 Appropriations.
94 See CRS Report R47423, Department of Veterans Affairs FY2023 Appropriations.
95 David I. Auerbach, William B. Weeks, and Ian Brantley, “Health Care Spending and Efficiency in the U.S.
Department of Veterans Affairs,” RAND Corporation Research Report RR-285-MTF, 2013, http://www.rand.org/
content/dam/rand/pubs/research_reports/RR200/RR285/RAND_RR285.pdf.
96 U.S. Bureau of Labor Statistics, Population Level - Veterans, World War II or Korean War or Vietnam Era, 18 Years
and over [LNU00077884], https://fred.stlouisfed.org/graph/?g=16mmy.
97 Department of Veterans Affairs, Veterans Health Administration, VISION PLAN, Updated Response to 38 U.S.C.
7330C(b): Strategy Regarding the Department of Veterans Affairs High-Quality Integrated Health Care System,
December 2020, pp. 46-47; and Department of Veterans Affairs, FY2023 Congressional Submission, Medical
Programs and Information Technology Programs, vol. 2 of 4, March 2022, p. VHA-202 and p.VHA-420.
Congressional Research Service
28
Discretionary Budget Authority by Subfunction: An Overview
Resolve (OIR) account for about 18% of the overall VA patients served.98 Over time these
veterans could account for a greater share of the veteran population.99 Moreover, the number of
women veterans is growing and also makes an increasing share of VHA patients with genderspecific health needs.100
Figure 12. Veterans’ Benefits and Services (700) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from the FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats. Discretionary funding for the Veterans education, training, and
rehabilitation (702) and the Veterans housing (704) subfunctions has not exceeded 0.005% of GDP since FY1977.
Programs within those subfunctions are generally funded by mandatory spending.
Second, the demand and reliance on VA care affects health care spending. VA estimates that of the
enrolled veterans in the VA health care system, on average about 38% rely on the VA for their
health care needs.101 Nevertheless, a higher percentage of veterans enrolled in the VA health care
system have multiple chronic conditions when compared to the nonveteran population. For
example, veterans generally experience arthritis earlier when compared to nonveterans; veterans
98 Department of Veterans Affairs, FY2023 Congressional Submission, Medical Programs and Information Technology
Programs, vol. 2 of 4, March 2022, p. VHA-307.
99 Department of Veterans Affairs, FY2023 Congressional Submission, Medical Programs and Information Technology
Programs, vol. 2 of 4, March 2022, pp. VHA-417 to VHA-421.
100 Department of Veterans Affairs, Veterans Health Administration, VISION PLAN, Updated Response to 38 U.S.C.
7330C(b): Strategy Regarding the Department of Veterans Affairs High-Quality Integrated Health Care System,
December 2020, p. 29.
101 “Reliance is defined as the portion of enrollees’ total health care needs expected from the VA health care system,
including both VA direct care and community care paid by VA, versus other health care options. For example, if an
enrollee received 10 office visits in a year, 4 from VA and 6 through Medicare, that enrollee would be considered 40%
(= 4 / 10) reliant on VA for office visits.” Department of Veterans Affairs, FY2023 Congressional Submission, Medical
Programs and Information Technology Programs, vol. 2 of 4, March 2022, p. VHA-440.
Congressional Research Service
29
Discretionary Budget Authority by Subfunction: An Overview
have higher rates of cancer than nonveterans after age 50; and veterans deployed to a theater of
conflict and those living in a rural county have slightly increased incidence of chronic diseases.102
These higher morbidity rates increase VA’s health care spending.103
Third, since 2009 Congress has expanded programs for community care,104 mental health and
suicide prevention, and services for women veterans at VA, with the passage of several major
pieces of legislation. These include, among others, the John S. McCain III, Daniel K. Akaka, and
Samuel R. Johnson VA Maintaining Internal Systems and Strengthening Integrated Outside
Networks Act of 2018 or the “VA MISSION Act of 2018” (P.L. 115-182); the Johnny Isakson and
David P. Roe, M.D. Veterans Health Care and Benefits Improvement Act of 2020 (P.L. 116-315);
the Commander John Scott Hannon Veterans Mental Health Care Improvement Act of 2019 (P.L.
116-171); and the Veterans Comprehensive Prevention, Access to Care, and Treatment Act of
2020 or the “Veterans COMPACT Act of 2020” (P.L. 116-214). Finally, the veterans’ health care
budget subfunction also saw one-time funding increases during the COVID-19 pandemic in 2020
and 2021.105
Funding within the Other Veterans’ Benefits and Services (705) subfunction, which has accounted
for roughly one-tenth of funding within the Veterans’ Benefits and Services budget function, has
doubled since FY2005 as a percentage of GDP.
Physical Resources
The Physical Resources superfunction includes the budget subfunctions Energy, Natural
Resources and Environment, Commerce and Housing Credit, Transportation, and Community and
Regional Development. Figure 13 shows discretionary funding for each of those budget
functions as a percentage of GDP.
Energy
Most funding within the Energy budget function supports operations of the Department of Energy
(DOE). The remainder supports rural electrification programs within the U.S. Department of
Agriculture, tax credits administered by the U.S. Treasury, certain activities of the Nuclear
Regulatory Commission, the Tennessee Valley Authority, and a few other agencies. About half of
DOE’s budget funds nuclear weapons programs or efforts to clean up sites used by those
programs, which fall within the Atomic Energy Defense Activities (053) subfunction.
102 Department of Veterans Affairs, Veterans Health Administration, VISION PLAN, Updated Response to 38 U.S.C.
7330C(b): Strategy Regarding the Department of Veterans Affairs High-Quality Integrated Health Care System,
December 2020, p. 48.
103 Department of Veterans Affairs, FY2023 Congressional Submission, Medical Programs and Information
Technology Programs, vol. 2 of 4, March 2022, p. 420.
104 Department of Veterans Affairs, FY2023 Congressional Submission, Medical Programs and Information
Technology Programs, vol. 2 of 4, March 2022, p. VHA-29. Also see, Congressional Budget Office, The Veterans
Community Care Program: Background and Early Effects, October 21, 2021.
105 See CRS Report R45390, VA Maintaining Internal Systems and Strengthening Integrated Outside Networks Act of
2018 (VA MISSION Act; P.L.115-182); CRS Report R46848, Commander John Scott Hannon Veterans Mental Health
Care Improvement Act of 2019 (P.L. 116-171) and Veterans COMPACT Act of 2020 (P.L. 116-214); CRS Report
R46340, Federal Response to COVID-19: Department of Veterans Affairs; CRS Report R46459, Department of
Veterans Affairs FY2021 Appropriations; and CRS Report R46964, Department of Veterans Affairs FY2022
Appropriations.
Congressional Research Service
30
Discretionary Budget Authority by Subfunction: An Overview
Figure 13. Discretionary Funding for Physical Resources
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
The largest spike in funding within the energy supply (271) subfunction visible in Figure 14
reflects responses to the second oil shock of 1978-1979. Following a revolution in 1978, Iran cut
its oil exports, which caused widespread disruptions through world energy markets in 1979.106 In
June 1980, President Jimmy Carter signed the Energy Security Act (P.L. 96-294), which
established various renewable energy initiatives and provided $88 billion for synthetic fuels
production.107 The Synthetic Fuels Corporation, which the act had created, was abolished in 1985
after struggling to develop viable projects.108
A smaller downtick in the emergency energy preparedness (274) subfunction in FY1980 also
reflects world oil supply disruptions that followed the Iranian revolution. The United States, in
consultation with G7 partner countries, agreed to suspend oil purchases for the Strategic
Petroleum Reserve in early 1979.109 In June 1980, the Energy Security Act mandated resumed oil
reserve purchases, although $2 billion was rescinded from the Strategic Petroleum Reserve the
106 Daniel Yergin, The Prize: The Epic Quest for Oil, Money and Power, (New York: Free Press, 1991), ch. 33.
107 Jimmy Carter, “Energy Security Act Remarks on Signing S. 952 Into Law,” June 30, 1980;
http://www.presidency.ucsb.edu/ws/?pid=44684.
108 Robert D. Hershey Jr., “Synfuels Corp. is Running on Empty,” New York Times, August 25, 1985. The Synthetic
Fuels Corporation was disestablished by P.L. 99-190 and P.L. 99-272.
109 U.S. Congress, Senate Committee on Energy and Natural Resources, Subcommittee on Energy Resources and
Materials Production, Strategic Petroleum Reserve, 96th Cong., 1st sess., December 13, 1979, S.Hrg. 96-91
(Washington: GPO, 1980). G7 members are the United States, the United Kingdom, France, the Federal Republic of
Germany, Italy, Japan, Canada, and the European Union.
Congressional Research Service
31
Discretionary Budget Authority by Subfunction: An Overview
following month, which is reflected in the negative value for FY1980.110 Congress required
additional oil reserve purchases in December 1980.111
Figure 14. Energy (270) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
The smaller spike visible in Figure 14 resulted from funding provided by ARRA in 2009, which
provided $90 billion in funding or tax credits for clean energy projects, not all of which were
within the energy budget function. DOE received about $35 billion in funding, with most of the
remainder supporting energy-related tax credits as well as mass transportation and high-speed rail
initiatives.112 The bump in discretionary budget authority beginning in FY2022 is a result of
funding provided by the Infrastructure Investment and Jobs Act (IIJA, P.L. 117-58), which
appropriated more than $62.2 billion over five years (FY2022-FY2026) to DOE.
Natural Resources and Environment
Funding within the Natural Resources and Environment budget function supports activities of a
wide range of federal agencies. Much of the discretionary funding for the U.S. Department of the
Interior (DOI) and all of the discretionary funding for the U.S. Environmental Protection Agency
(EPA) falls within this function, as does most of the funding for the U.S. Forest Service and
certain conservation programs of agencies within the U.S. Department of Agriculture. Funding
110 Supplemental Appropriations and Rescission Act, 1980 (P.L. 96-304).
111 P.L. 96-514.
112 Center for Climate and Energy Solutions, “U.S. Department of Energy’s Recovery Act Investments,” issue brief,
January 5, 2013, http://www.c2es.org/docUploads/arra-brief-feb-2013.pdf. See Transportation section below. Also see
CRS In Focus IF10869, Reconsidering the Strategic Petroleum Reserve, by Robert Pirog.
Congressional Research Service
32
Discretionary Budget Authority by Subfunction: An Overview
within this budget function also supports operations of the U.S. Department of Commerce’s
National Oceanic and Atmospheric Administration (NOAA), water projects of the U.S. Army
Corps of Engineers (USACE), and the U.S. Coast Guard’s pollution control activities related to
spills of oil and hazardous substances in the coastal zone, among other agencies and activities.
The Natural Resources and Environment function has five subfunctions: water resources (301),
conservation and land management (302), recreational resources (303), pollution control and
abatement (304), and other natural resources (306).113 As a percentage of GDP, more variation in
discretionary budget authority was exhibited throughout the period in three subfunctions—water
resources, conservation and land management, and pollution control and abatement—than in the
other two subfunctions.
The water resources subfunction (301) principally represents water infrastructure (e.g.,
multipurpose dams, navigation locks, levees) built and sometimes owned and operated by the
federal government. Discretionary budget authority for water resources projects has, by and large,
declined as a percentage of GDP since the late-1970s, as Figure 15 indicates, due to a number of
reasons. For instance, the Water Resources Development Act of 1986 (WRDA; P.L. 99-662)
changed cost shares for USACE projects that reduced the federal share of project costs. Also, a
number of Administrations reduced emphasis on construction of large, multipurpose federal water
resource infrastructure, including by the Bureau of Reclamation, in general.114 In certain years
since FY2005, funding for the water resources subfunction increased as a percentage of GDP. The
peaks shown in Figure 15 generally reflect enactment of supplemental appropriations for natural
disaster response (e.g., hurricanes and subsequent construction of flood risk reduction projects),
economic stimulus, and infrastructure development.115
Discretionary budget authority for the conservation and land management subfunction (302)
encompasses various agencies and programs. It includes funding for certain U.S. Department of
Agriculture agencies and certain DOI agencies, among other entities.116 Discretionary budget
authority for this subfunction fluctuated over the period examined. It declined overall from the
late 1970s to about half that level in FY2021. The peak in FY2022, as a percentage of GDP, can
be attributed in large part to emergency supplemental funding in the Infrastructure Investment and
Jobs Act (P.L. 117-58, IIJA) for various activities within the subfunction. They included
abandoned mine land and water reclamation projects; orphaned well site plugging, remediation,
and restoration activities; federal land and resource management; ecosystem restoration; and
wildland fire management.
113 There is no subfunction 305.
114 For more information on these policy decisions and implications regarding two primary water resources agencies,
see CRS Report R45185, Army Corps of Engineers: Water Resource Authorization and Project Delivery Processes, by
Nicole T. Carter and Anna E. Normand, and CRS Report R46303, Bureau of Reclamation: History, Authorities, and
Issues for Congress, by Charles V. Stern and Anna E. Normand.
115 For example, see Figure 1 in CRS In Focus IF11945, U.S. Army Corps of Engineers: Supplemental Appropriations,
by Anna E. Normand and Nicole T. Carter, and Table 2 in CRS Report R47440, Water Resource Issues in the 118th
Congress, by Anna E. Normand et al.
116 Agriculture agencies include the U.S. Forest Service (including for wildland fire management) and conservation
programs of the Farm Service Agency and Natural Resources Conservation Service. DOI agencies include certain
accounts and activities of the Bureau of Indian Affairs; Bureau of Land Management; Bureau of Ocean Energy
Management; Bureau of Safety and Environmental Enforcement; Office of Surface Mining Reclamation and
Enforcement; U.S. Fish and Wildlife Service; and U.S. Department of the Interior, Departmental Offices and
Department-Wide programs (e.g., wildland fire management), among others.
Congressional Research Service
33
Discretionary Budget Authority by Subfunction: An Overview
Figure 15. Natural Resources and Environment (300) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
The recreational resources subfunction (303) includes the National Park Service (NPS) as well as
various smaller entities. From the late 1970s to the early 1980s, discretionary budget authority for
recreational resources (303) declined as a percentage of GDP. This was partly due to a reduction
in funding from the Land and Water Conservation Fund for the NPS. Portions of this fund are
provided to the NPS for land acquisition and grants to states for outdoor recreation. Thereafter,
recreational resources continued to decline, but at a more modest rate than previously.
The pollution control and abatement subfunction (304) includes a wide range of environmental
protection activities of EPA and other federal agencies under authority of statutes such as the
Clean Air Act, Clean Water Act, Safe Drinking Water Act, and Comprehensive Environmental
Response, Compensation, and Liability Act. The peak in Figure 15, in the 1970s, reflects federal
support for construction of local wastewater treatment plants and other water quality initiatives,
which fall within subfunction 304.117 Figure 15 illustrates that discretionary budget authority for
subfunction 304 as a percentage of GDP gradually decreased over time until FY2022. The
subsequent increase from FY2022 through FY2026 primarily reflects supplemental
appropriations to EPA for water infrastructure financial assistance programs in the Infrastructure
Investment and Jobs Act (IIJA; P.L. 117-58), which was enacted in November 2021.118 Federal
aid for local water infrastructure projects, especially EPA assistance, has evolved over time from
117 See CRS Report 96-647, Water Infrastructure Financing: History of EPA Appropriations, by Jonathan L. Ramseur
and Mary Tiemann.
118 For more information about drinking water and wastewater infrastructure funding, see CRS Report R46892,
Infrastructure Investment and Jobs Act (IIJA): Drinking Water and Wastewater Infrastructure, by Elena H. Humphreys
and Jonathan L. Ramseur. CRS Report R47717, Lead Service Lines (LSLs) Replacement: Funding Developments, by
Elena H. Humphreys provides more information on a subset of the IIJA water infrastructure appropriations.
Congressional Research Service
34
Discretionary Budget Authority by Subfunction: An Overview
a program that provided grants directly to local governments for wastewater treatment plant
construction to the primary programs for clean water and drinking water infrastructure projects.
Under these programs, the federal government provides grants to states to capitalize state loan
programs.119 More recently, Congress has amended these loan programs to increase the amount of
principal forgiveness, grants, or other types of additional subsidization that states can provide to
communities.120 Further, EPA has the authority to provide direct loans or grants to support such
infrastructure.121
The Other Natural Resources (306) subfunction includes the U.S. Geological Survey; activities of
NOAA; and certain DOI Departmental Offices and Department-wide programs, among others.
Discretionary budget authority for this subfunction had a relatively modest decline, as a
percentage of GDP, throughout the period examined.
Commerce and Housing Credit
The commerce and housing credit budget function supports a variety of programs within the U.S.
Department of Commerce and the Department of Housing (HUD), along with several other
federal agencies. The 2007-2009 financial crisis and subsequent Great Recession led to changes
in federal housing finance policies.122
The interrelation between discretionary and mandatory funding for many programs within that
budget function is complex. In part, that complexity stems from how federal credit rules operate.
Many of the programs in this budget function provide credit for housing, business loans, and
other purposes, and their costs are therefore calculated using methods prescribed by the Federal
Credit Reform Act (FCRA; described above). Changes in estimates of the subsidy costs of those
loans are sensitive to anticipated economic conditions, which can cause large fluctuations in
budgetary costs, even if current cash flows are more stable.
When the present value of fees or other receipts collected through a program exceeds
disbursements and default costs, estimated using FCRA methods, a negative credit subsidy results
which appears as negative BA. For example, the large negative amounts shown in Figure 16 for
the mortgage credit (371) subfunction following the 2007-2009 Great Recession largely reflect
negative credit subsidy estimates for the single-family mortgage insurance program within the
Federal Housing Administration (FHA) and, to a lesser extent, Ginnie Mae (Government National
119 The 117th Congress reestablished the practice of providing funds directly for community water infrastructure
projects through community project funding/congressionally directed spending (CPF/CDS) items, commonly called
earmarks. CRS Report R47633, The Role of Earmarks in CWSRF and DWSRF Appropriations in the 117th Congress,
by Elena H. Humphreys provides more information.
120 See CRS Report R47935, Changes to the Drinking Water State Revolving Fund (DWSRF) Program, by Elena H.
Humphreys for more details.
121 For more information, see CRS Report R46471, Federally Supported Projects and Programs for Wastewater,
Drinking Water, and Water Supply Infrastructure, coordinated by Jonathan L. Ramseur.
122 Many federal agencies took steps to mitigate the effects of the financial crisis in 2007 and 2008. Congress also
passed measures that significantly reshaped federal housing finance policies. For instance, the Housing and Economic
Recovery Act of 2008 (P.L. 110-289), among other provisions, set up authorities that were used to put the governmentsponsored enterprises (GSEs) Fannie Mae and Freddie Mac, which guarantee a major share of U.S. housing mortgages,
into conservatorships when both faced insolvency in September 2008. See Financial Crisis Inquiry Commission, Final
Report, February 25, 2011, https://www.govinfo.gov/app/details/GPO-FCIC. For a description of how the Federal
Housing Administration reacted to the financial crisis, see HUD, Office of Policy Development and Research, “The
Federal Housing Administration: Bringing the Housing Finance System Out of a Chaotic Situation,” Evidence Matters,
summer/fall 2020, https://www.huduser.gov/portal/periodicals/em/SummerFall20/highlight2.html.
Congressional Research Service
35
Discretionary Budget Authority by Subfunction: An Overview
Mortgage Association).123 Expected negative credit subsidies for FHA-insured mortgages
increased in the years after the housing market turmoil of the late 2000s as a result of several
factors, including better credit quality of FHA-insured mortgages, increases in the fees that FHA
charges to borrowers, and higher FHA loan volumes.
Figure 16. Commerce and Housing Credit (370) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
The other advancements of commerce (376) subfunction includes a diverse range of activities
within the Department of Commerce, the Small Business Administration (SBA), many
independent federal regulatory bodies, and other entities. Funding for the decennial census falls
within this subfunction and is reflected in peaks at 10-year intervals visible in Figure 16. The
SBA administered several COVID-19 pandemic relief programs that provided loans and grants to
small businesses and nonprofit organizations.124 The negative value for FY2025 reflects a
123 See CRS Report R42875, FHA Single-Family Mortgage Insurance: Financial Status of the Mutual Mortgage
Insurance Fund (MMI Fund), by Katie Jones. Also see Chad Chirico and Susanne Mehlman, “How FHA’s Mutual
Mortgage Insurance Fund Accounts for the Cost of Mortgage Guarantees,” CBO Blog, October 22, 2013;
https://www.cbo.gov/publication/44634. The largest discretionary account in the Mortgage Credit subfunction is the
FHA-Mutual Mortgage Insurance Capital Reserve. That account recorded $214 million in negative BA in FY2007,
which expanded to $17.4 billion in negative BA in FY2013. In later years, magnitudes have been smaller, although
they have fluctuated widely.
124 CRS Report R47694, SBA as a Vehicle for Crisis Relief: Lessons from the COVID-19 Pandemic, coordinated by
Adam G. Levin.
Congressional Research Service
36
Discretionary Budget Authority by Subfunction: An Overview
proposed cancellation of $9.6 billion in BA for the Department of Commerce’s Nonrecurring
Expenses Fund, which supports various information technology projects.125
The Infrastructure Investment and Jobs Act (IIJA; P.L. 117-58), enacted in November 2021,
provided $65 billion in funding programs to expand access to broadband internet connections
administered by the National Telecommunications and Information Administration and the
Federal Communications Commission.126
The U.S. Postal Service (USPS; postal service subfunction 376) operates under a mandate to
cover its costs with its own revenues, and thus runs without an operating subsidy from the federal
government.127 Congress does appropriate funds to offset postal revenues that were foregone by
charging concessionary rates for certain postal services, although as can be seen in Figure 16,
that funding has decreased over time.128
Transportation
Funding within the transportation budget function primarily supports activities of the U.S.
Department of Transportation (DOT), including grants and other forms of financial support
provided to state and local governments. That funding also supports some operations of the U.S.
Coast Guard, which was transferred from DOT to the U.S. Department of Homeland Security in
2003, as well as various boards and commissions involved in transportation issues. Figure 17
shows funding trends within the transportation budget function.
Some ground transportation programs have had a special budgetary status since 1988, in which
BA is treated as mandatory but outlays are classified as discretionary.129 This status enables some
transportation funding to avoid budgetary restraints that affect most other federal funding.
Moreover, that dual designation of surface transportation funding complicates analysis of trends
in federal spending to support various forms of transportation. Thus, trends in funding for ground
transportation shown in Figure 17 exclude the vast majority of federal highway and mass transit
(also known as public transportation) funding supported by the Highway Trust Fund, which is
classified as mandatory, rather than discretionary, BA. Moreover, those amounts do not reflect
expenditures of state and local governments, which are typically required to match federal funds
at some level. Discretionary funding for ground transportation also does not reflect transfers from
the U.S. Treasury’s general fund to the Highway Trust Fund.130
The ground transportation (401) subfunction includes federal support for mass transit and
Amtrak, as well as funding for operations of DOT bureaus such as the Federal Railroad
Administration and the Federal Highway Administration, as well as various transportation-related
125 OMB, FY2025 Budget, Budget Appendix, pp. 175-176, https://www.whitehouse.gov/wp-content/uploads/2024/03/
com_fy2025.pdf.
126 National Telecommunications and Information Administration, “NTIA’s Role in Implementing the Broadband
Provisions of the 2021 Infrastructure Investment and Jobs Act,” https://broadbandusa.ntia.doc.gov/news/latest-news/
ntias-role-implementing-broadband-provisions-2021-infrastructure-investment-and. See also CRS Report R47506, The
Persistent Digital Divide: Selected Broadband Deployment Issues and Policy Considerations, by Colby Leigh Rachfal.
127 See CRS Report R44603, Reforming the U.S. Postal Service: Background and Issues for Congress, coordinated by
Michelle D. Christensen.
128 See CRS Report RS21025, The Postal Revenue Forgone Appropriation: Overview and Current Issues, by Kevin R.
Kosar.
129 CBO, The Highway Trust Fund and the Treatment of Surface Transportation Programs in the Federal Budget, June
2014; https://www.cbo.gov/sites/default/files/113th-congress-2013-2014/reports/45416-TransportationScoring.pdf.
130 See CRS Report R47573, Funding and Financing Highways and Public Transportation Under the Infrastructure
Investment and Jobs Act (IIJA), by Robert S. Kirk and William J. Mallett.
Congressional Research Service
37
Discretionary Budget Authority by Subfunction: An Overview
safety or regulatory bodies. The peak in discretionary funding for ground transportation during
the late 1970s and early 1980s evident in Figure 17 reflects, in large measure, grants to local
governments to expand, modernize, or operate mass transit systems.131 Through the 1980s,
however, that support was reduced. A second peak reflects increased funding for road and other
infrastructure projects in ARRA.
Figure 17. Transportation (400) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
Funding within the air transportation (402) subfunction has varied less. Increased funding for
airport security after the attacks of September 11, 2001, is visible in Figure 17. The
Transportation Security Administration (TSA) was created within DOT in November 2001, but
was transferred to the U.S. Department of Homeland Security (DHS) in March 2003.
Funding within the water transportation (403) subfunction, again measured as a percentage of
GDP, has been even more stable.
Community and Regional Development
The Community and Regional Development budget function (450) includes funding for various
federal programs that support state and local government development initiatives in urban and
131 CBO, Public Works Infrastructure: Policy Considerations for the 1980s, April 1983, ch. 3, https://www.cbo.gov/
sites/default/files/98th-congress-1983-1984/reports/doc20-entire.pdf. Also see DOT, Urban Mass Transit
Administration, FY1980 Summary of UMTA’S Transit Assistance Program, 1981, https://ia802709.us.archive.org/13/
items/fy1980yearendsum00offi_0/fy1980yearendsum00offi_0.pdf.
Congressional Research Service
38
Discretionary Budget Authority by Subfunction: An Overview
rural areas, as well as funding to support responses to natural and other disasters. Figure 18
shows funding trends within that budget function.
The largest item within the Community Development (451) subfunction is the U.S. Department
of Housing and Urban Development’s (HUD’s) Community Development Fund, which provides
resources for the Community Development Block Grant (CDBG) program.132 That subfunction
also includes programs administered by the U.S. Department of Agriculture (USDA), the U.S.
Department of the Treasury, and other federal agencies. Federal community development funding
fell from almost 0.2% of GDP in the late 1970s to about half that level in the 1990s.
Figure 18. Community and Regional Development (450) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
Funding since FY2000 has fluctuated significantly, reflecting congressional responses to natural
and other disaster-related events, and economic recessions.133 Community Development Block
Grant Disaster Recovery Funding (CDBG-DR), a part of the Community Development Fund, has
supported long-term recovery efforts and met needs not addressed by other federal programs.
Congress has often provided CDBG-DR funding through supplemental emergency appropriations
following disasters.
132 See CRS Report R46733, Community Development Block Grants: Funding and Allocation Processes, by Joseph V.
Jaroscak. Also see Seth R. Marcus, “Community Development Block Grants,” in Goldfield, David R. (ed.),
Encyclopedia of American Urban History, (Thousand Oaks, CA: Sage, 2006).
133 See CRS Report R46475, The Community Development Block Grant’s Disaster Recovery (CDBG-DR) Component:
Background and Issues, by Joseph V. Jaroscak. For data on CDBG funding from FY2000-FY2014, see CRS Report
R43394, Community Development Block Grants: Recent Funding History, by Eugene Boyd.
Congressional Research Service
39
Discretionary Budget Authority by Subfunction: An Overview
The Area and Regional Development (452) subfunction includes a wide range of programs, from
operations of the Department of Interior’s Bureau of Indian Affairs (BIA) and Bureau of Indian
Education (BIE), to assorted USDA rural development initiatives, as well as Department of
Commerce’s Economic Development Administration (EDA) programs and federally chartered
regional development commissions, such as the Appalachian Regional Commission, the Delta
Regional Authority, the Denali Commission, and the Northern Border Regional Commission. An
anti-recession measure—the Public Works Employment Act (P.L. 95-28)—increased funding for
FY1977 and FY1978 with the aim of supporting local public works-focused job creation efforts.
The disaster relief and insurance (453) subfunction mainly funds the Federal Emergency
Management Agency, which has been part of the Department of Homeland Security (DHS) since
2003. That subfunction also includes other programs within USDA, SBA, and HUD. Funding for
the disaster relief and insurance subfunction has been volatile in large part because it is driven by
responses to natural and manmade disasters that by definition are difficult to anticipate. The
largest spike in funding reflects responses to Hurricanes Katrina, Rita, and Wilma, which hit the
Gulf Coast in 2005. A smaller spike in FY2013 reflects funding for responses to Hurricane Sandy,
which hit the Atlantic Coast. A larger spike for FY2018 reflects responses, especially through the
Disaster Relief Fund,134 to two hurricanes that hit Puerto Rico and the U.S. Virgin Islands in
September 2017, as well as other hurricanes and floods that hit the eastern and Gulf Coast
states.135 The spike at FY2020 mostly reflects funding for the Disaster Relief Fund to support
programs responding to the COVID-19 pandemic.136
Other Federal Functions
The Other Federal Functions category includes the General Science, Space, and Technology;
Agriculture; Administration of Justice; and General Government budget functions. Figure 19
shows discretionary funding trends for those functions.
General Science, Space, and Technology
Funding within the General Science, Space, and Technology budget function (250)—shown in
Figure 20—has been dominated for most of the past half century by spending to support
operations of the National Aeronautics and Space Administration (NASA), which falls within the
space flight, research and supporting activities subfunction (252). In some years during the mid1960s, as the Apollo program was moving toward its aim of manned lunar exploration, NASA
accounted for over 4% of total federal spending—well beyond the scale used in Figure 20.137
After the Apollo program ended in the early 1970s, NASA funding levels in inflation-adjusted
terms and as a percentage of GDP declined in the face of budgetary pressures. The narrow peak
visible in Figure 20 reflects funding for a replacement space shuttle after the January 1986
Challenger disaster. From FY1993 to FY2016, BA for NASA fell from about 0.2% of GDP to
about 0.1% of GDP, as funding did not keep pace with inflation and economic growth.
134 See CRS Report R45484, The Disaster Relief Fund: Overview and Issues, by William L. Painter.
135 See CRS Report R46609, The Status of Puerto Rico’s Recovery and Ongoing Challenges Following Hurricanes
Irma and María: FEMA, SBA, and HUD Assistance, coordinated by Elizabeth M. Webster.
136 See CRS Report R47048, FEMA’s Role in the COVID-19 Federal Pandemic Response, coordinated by Erica A.
Lee.
137 See OMB, FY2018 Budget, Historical Tables, Table 4.2. NASA spending accounted for 4.3% of federal outlays in
FY1965 and 4.4% in FY1966. See also CBO, Reinventing NASA, March 1994, https://www.cbo.gov/sites/default/files/
cbofiles/ftpdocs/48xx/doc4893/doc20.pdf.
Congressional Research Service
40
Discretionary Budget Authority by Subfunction: An Overview
Figure 19. Discretionary Funding for Other Government Functions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
Figure 20. General Science, Space, and Technology (250) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Congressional Research Service
41
Discretionary Budget Authority by Subfunction: An Overview
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
Funding for the General Science and Basic Research subfunction (251) mostly supports the
National Science Foundation (NSF) and the basic research activities of the Office of Science
within the Department of Energy (DOE). As a proportion of GDP, it rose, albeit unsteadily, from
the mid-1980s to the late 2000s. In 2006, the George W. Bush Administration’s American
Competitiveness Initiative, established by and subsequently authorized by Congress in the
America COMPETES Act (P.L. 110-69) and America COMPETES Reauthorization Act of 2010
(P.L. 111-358), set out a goal to double funding for NSF and the DOE Office of Science. That
goal has not been achieved. In FY2009, ARRA provided a temporary boost in funding for general
science and basic research.
Agriculture
The Agriculture budget function (350) includes the Agricultural Research and Services (352)
subfunction and the Farm Income Stabilization (351) subfunction. Nearly all funding within that
budget function supports operations of the U.S. Department of Agriculture (USDA). Some of the
largest USDA programs, however, such as the Supplemental Nutrition Assistant Program (SNAP)
and some child nutrition programs, are classified within the Income Support budget function.
Most Forest Service and USDA conservation activities fall under the Natural Resources and
Environment budget function, and provision of foreign food aid falls under the International
Affairs budget function. Figure 21 shows trends within the Agriculture budget function.
Figure 21. Agriculture (350) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
Congressional Research Service
42
Discretionary Budget Authority by Subfunction: An Overview
The largest components of discretionary funding within the Agricultural Research and Services
subfunction support activities of the Agricultural Research Service and the National Institute of
Food and Agriculture. Funding for the Animal and Plant Health Inspection Service (APHIS)
quadrupled between FY1999 and FY2003. APHIS also received extra funds to respond to bird flu
threats in FY2015, which are reflected in a small peak visible in Figure 21.138 Overall, funding
for Agricultural Research and Services as a percentage of GDP has declined from about 0.05% in
the late 1970s to about half that level in the mid-2010s. The two larger peaks for FY2020 and
FY2022 reflect funding to support agricultural producers affected by the COVID-19 pandemic
provided in the CARES Act (P.L. 116-136; Division B, Title I), the American Rescue Plan Act of
2021 (P.L. 117-2; Title I), and other legislation.139
The sharp funding increase within the Farm Income Stabilization subfunction for FY1992 reflects
implementation of the Federal Credit Reform Act of 1990 (FCRA; P.L. 101-508), which changed
the budgetary treatment of federal loan and loan guarantee programs.140 The peak in FY2008
reflects ad hoc disaster assistance. Many farm income stabilization programs are mostly funded
via mandatory spending, although discretionary spending generally covers administrative costs.
Administration of Justice
Figure 22 shows funding trends within the Administration of Justice (750) budget function,
which includes most federal judicial, law enforcement, and correctional activities.
The Federal Law Enforcement Activities (751) subfunction includes operations of the Department
of Homeland Security (DHS), such as the U.S. Customs and Border Protection (CBP), the U.S.
Immigration and Customs Enforcement (ICE), and the U.S. Secret Service, as well as operations
of the U.S. Department of Justice (DOJ), including the Federal Bureau of Investigation (FBI), the
Drug Enforcement Administration (DEA), the Bureau of Alcohol, Tobacco, Firearms, and
Explosives (ATF), and the U.S. Marshals (USMS). Counterterrorism activities, which account for
roughly half of the FBI’s funding, are classified under the Defense-Related Activities (054)
subfunction.
Funding within the Federal Law Enforcement subfunction, measured as a percentage of GDP,
more than doubled in the period FY1980 to FY2010. Funding increases for CBP and ICE account
for much of that increase. In FY1977, CBP and ICE accounted for just over a third (35%) of all
funding within the federal law enforcement activities subfunction, while in FY2016 they
accounted for over half (54%). Since FY2010, however, funding as a percentage of GDP has
fallen to a level slightly above what it was in the mid-2000s. During that time period, funding for
CBP and ICE rose by 10% in nominal terms, while funding for the rest of the subfunction was
essentially flat.
The Federal Litigative and Judicial Activities subfunction (752) includes operations of the judicial
branch and trial-related activities such as pre-trial detention by U.S. Marshals and publicly funded
legal defense services. The subfunction also covers operations of offices of U.S. Attorneys and
legal activities of DOJ, as well as boards and commissions that address legal matters. Funding for
138 See CRS Report R44114, Update on the Highly-Pathogenic Avian Influenza Outbreak of 2014-2015, by Joel L.
Greene.
139 See CRS In Focus IF11764, U.S. Agricultural Aid in Response to COVID-19, by Randy Schnepf and Stephanie
Rosch.
140 See CRS Report R44193, Federal Credit Programs: Comparing Fair Value and the Federal Credit Reform Act
(FCRA), by Raj Gnanarajah.
Congressional Research Service
43
Discretionary Budget Authority by Subfunction: An Overview
this subfunction, measured as a percentage of GDP, has trended slightly upward until FY2010 and
slightly downward since then.
Figure 22. Administration of Justice (750) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
The Federal Correctional Activities subfunction (753) includes the DOJ Federal Prison System.
The small increase visible in Figure 22 reflects a one-time increase of about $1 billion for prison
buildings and facilities in FY1990.
The Criminal Justice Assistance subfunction (754) includes DOJ programs that assist state and
local governments combat crime, violence against women, and drug trafficking; and that
strengthen local juvenile justice and other local initiatives. The increase in funding visible in
Figure 22 in FY1994 reflects enactment of the Violent Crime Control and Law Enforcement Act
of 1994 (P.L. 103-322), by which Congress and President Bill Clinton aimed to fund the hiring of
an additional 100,000 local police officers via the community-oriented policing (COPS)
program.141 After decreases in funding for COPS during the mid-2000s, additional funds were
provided as part of the ARRA stimulus. Since then, the level of funding, measured as a
percentage of GDP, has decreased.
In some years, restrictions on the Crime Victims Fund (CVF) were used to offset other
discretionary spending according to budgetary scoring rules governing changes in mandatory
program spending (CHIMPS). Those restrictions did not reduce the flow of federal support for
state grants, because CVF balances were well above usual grant funding levels.
141 See CRS Report RL33308, Community Oriented Policing Services (COPS): In Brief, by Nathan James.
Congressional Research Service
44
Discretionary Budget Authority by Subfunction: An Overview
According to budget estimates from OMB, however, DOJ will not be able to sustain FY2023
levels of funding for programs funded by the Crime Victims Fund (CVF) in FY2024.142 For
several years, the annual carryover balance of the CVF has declined, and the CVF balance, as of
January 31, 2024, was $1.291 billion.143 This is not enough to sustain the $1.9 billion obligation
cap set by Congress to fund Victims of Crime Programs for FY2023.
General Government
The General Government (800) budget function includes costs of operating the legislative and
executive branches, as well as administering federal personnel policy, managing federal records
and property, and providing fiscal support to state and local governments. Figure 23 shows trends
in funding by subfunction within that budget function.
The Legislative Functions (801) subfunction includes activities of Congress and congressional
agencies, such as the Government Accountability Office (GAO), the Congressional Budget Office
(CBO), and the Congressional Research Service (CRS). The subfunction also includes the Capitol
Police and the Architect of the Capitol, along with various congressional commissions and
boards. From FY1977 to FY2000, funding for the legislative functions subfunction, measured as
a percentage of GDP, trended slightly downward. Since then, funding for that subfunction has
ranged from 0.03% to 0.04% of GDP.
Figure 23. General Government (800) Subfunctions
Discretionary budget authority as a percentage of GDP, FY1977-FY2029
Source: CRS, based on OMB data from FY2025 budget submission.
142 For more information on the Crime Victims Fund, see CRS Report R42672, The Crime Victims Fund: Federal
Support for Victims of Crime.
143 Department of Justice, Office of Justice Programs, Office for Victims of Crime, FY 2007 – FY 2024 Crime Victims
Fund End of Year Balance, https://ovc.ojp.gov/about/crime-victims-fund/fy-2007-2024-cvf-balance.pdf.
Congressional Research Service
45
Discretionary Budget Authority by Subfunction: An Overview
Notes: FY2024 levels are estimated. FY2024-FY2029 levels reflect Administration proposals and projections.
See OMB budget documents for further caveats.
The Executive Direction and Management (802) subfunction includes activities of the White
House, the Executive Office of the President, agencies closely connected to the President such as
the Office of Management and Budget (OMB), the U.S. Trade Representative, and certain drug
control activities. Various boards, commissions, councils, and offices associated with the
presidency are also included. Over the FY1977-FY2017 period, funding within that subfunction
has not exceeded 0.01% of GDP.
The Central Fiscal Operations (803) subfunction includes operations of the Internal Revenue
Service (IRS) as well as fiscal and currency operations of the U.S. Treasury. Since FY1990, the
IRS accounted for at least 90% of the funding within that subfunction. Thus, to a large extent, the
decline in funding for the subfunction, measured as a percentage of GDP, reflects trends in
funding for the IRS, which has resulted in reductions in staffing and enforcement activities.144
The Inflation Reduction Act of 2022 (P.L. 117-169) provided $79 billion in mandatory funding to
support activities similar to those previously funded via discretionary funds.145 The Fiscal
Responsibility Act (FRA; P.L. 118-5) rescinded $1.4 billion of those funds, which is reflected in
the downtick for FY2024.146
The General Property and Records Management (804) subfunction includes operations of the
General Services Administration (GSA) and the National Archives and Records Administration
(NARA). Fluctuations in funding within this subfunction in large part reflect costs of GSA’s
Federal Buildings Fund.147 That fund operates somewhat as a revolving fund that receives rent
payments from federal agencies. Proceeds, through appropriations law, are used to lease
properties or to acquire and maintain federally owned properties, although it has received
supplemental appropriations to fund buildings in some years. In other years, rental revenues
exceeded building expenses, resulting in negative budget authority.
The Central Personnel Management (805) subfunction includes operations of the Office of
Personnel Management (OPM) as well as several offices concerned with federal workforce issues
such as the Merit Systems Protection Board, the Office of Special Counsel, and the Office of
Government Ethics. Funding for this subfunction was about 0.05% of GDP in the late 1970s, and
that percentage has declined since then.
The General Purpose Fiscal Assistance (806) subfunction covers various forms of assistance to
state and local government. The high funding levels visible in Figure 23 in the 1970s reflect
credit support offered to New York City.148 A facility for short-term loans that were to be paid
back at the end of each city fiscal year supplied the bulk of that support.149 The subfunction also
144 CBO, Trends in the Internal Revenue Service’s Funding and Enforcement, July 2020, https://www.cbo.gov/
publication/56467.
145 See CRS In Focus IF12394, The Internal Revenue Service’s Strategic Operating Plan to Spend $79 Billion in
Inflation Reduction Act Funding, by Brendan McDermott and Gary Guenther.
146 See CRS Insight IN12172, Changes to IRS Funding in the Debt Limit Deal, by Brendan McDermott. Also see CBO,
How Changes in Funding for the IRS Affect Revenues, February 2024, https://www.cbo.gov/system/files/2024-02/
59972-IRS-Rescissions.pdf.
147 See GAO, Federal Buildings Fund: Improved Transparency and Long-term Plan Needed to Clarify Capital
Funding Priorities, GAO-12-646, July 2012, http://www.gao.gov/assets/600/592377.pdf.
148 See archived CRS Report 95-328E, Financial Control Boards for Cities in Distress, by Nona Notto and Lillian
Rymarowicz, which is available to congressional clients upon request.
149 CBO, Overview of the 1977 Budget, February 4, 1976, p. 94, https://www.cbo.gov/sites/default/files/94th-congress1975-1976/workingpaper/76doc549_0.pdf.
Congressional Research Service
46
Discretionary Budget Authority by Subfunction: An Overview
includes federal support for the District of Columbia.150 Since the early 1980s, when this funding
subfunction accounted for about 0.2% of GDP, funding according to that measure has declined.
The Other General Government (808) subfunction includes a broad array of miscellaneous federal
activities. The mid-2000s uptick visible in Figure 23 reflects federal support for electoral reform.
150 See CRS Report R47319, FY2023 District of Columbia Budget and Appropriations, by Joseph V. Jaroscak.
Congressional Research Service
47
Discretionary Budget Authority by Subfunction: An Overview
Appendix. Descriptions of Budget Functions
BUDGET FUNCTION 050: NATIONAL DEFENSE
The National Security function includes funds to develop, maintain, and equip the military forces
of the United States. Historically, about 95% of these funds go to Department of Defense military
activities, with remaining funding dedicated to atomic energy defense activities within the
Department of Energy and other defense-related activities.
BUDGET FUNCTION 150: INTERNATIONAL AFFAIRS
The International Affairs function contains spending on international humanitarian, development,
and security assistance; the conduct of foreign affairs; foreign information and exchange
activities; and international financial programs. The funding supports operations at major
agencies including the Departments of State, Treasury, and Agriculture; the U.S. Agency for
International Development (USAID); and the Millennium Challenge Corporation.
BUDGET FUNCTION 250: SCIENCE AND TECHNOLOGY
The Science and Technology function includes the National Science Foundation, programs other
than aviation programs at the National Aeronautics and Space Administration (NASA), and
general science programs at the Department of Energy.
BUDGET FUNCTION 270: ENERGY
The Energy function concerns the production, development, and use of energy for the country.
This function contains civilian energy programs at agencies including the Departments of Energy
and Agriculture, the Tennessee Valley Authority, the Federal Energy Regulatory Commission, and
the Nuclear Regulatory Commission.
BUDGET FUNCTION 300: NATURAL RESOURCES AND ENVIRONMENT
The Natural Resources and Environment function focuses on the management, development, and
maintenance of the nation’s natural heritage. This function includes conservation of land and
water resources; development of water power and transportation infrastructure; and agencies and
resources associated with the management and regulation of pollution, public and recreational
lands, and natural resources.
BUDGET FUNCTION 350: AGRICULTURE
The Agriculture function includes the Department of Agriculture and the Farm Credit
Administration, and only deals with programs concerned with agricultural production.
BUDGET FUNCTION 370: COMMERCE AND HOUSING CREDIT
The Commerce and Housing Credit function includes the regulation and promotion of commerce
and certain housing policies and agencies. Agencies concerned with the economy as a whole fall
under this function. In addition, general-purpose subsidies and credit subsidies are recorded here.
BUDGET FUNCTION 400: TRANSPORTATION
The Transportation function focuses on aid and regulation for ground transportation, including
roads and highways, railroads, and urban mass transit; air transportation, including aeronautical
research conducted by NASA; and maritime commerce. The major agencies included in this
function are the Department of Transportation, including the Federal Aviation Administration, the
Federal Highway Administration, the Federal Transit Administration, and the Maritime
Administration; the Department of Homeland Security, including the Transportation Security
Congressional Research Service
48
Discretionary Budget Authority by Subfunction: An Overview
Administration, the U.S. Coast Guard, and the Federal Air Marshal Service; and the National
Railroad Passenger Corporation.
BUDGET FUNCTION 450: COMMUNITY AND REGIONAL DEVELOPMENT
The Community and Regional Development function includes federal programs to improve
community economic conditions, promote rural development, and assist in federal preparations
for, and responses to, disasters. This function provides appropriated funding for the Community
Development Block Grant program, Department of Agriculture rural development programs, the
Bureau of Indian Affairs, the Federal Emergency Management Agency, and other disaster
mitigation and community development-related programs. It also provides mandatory funding for
the federal flood insurance program.
BUDGET FUNCTION 500: EDUCATION, TRAINING, EMPLOYMENT, AND SOCIAL
SERVICES
The Education, Training, Employment, and Social Services function includes funding for the
Department of Education, some social services programs within the Department of Health and
Human Services, and employment and training programs within the Department of Labor.
BUDGET FUNCTION 550: HEALTH
The Health function contains spending on a variety of health care services administered by the
Department of Health and Human Services. Specifically, the function includes health research
overseen by the National Institutes of Health; public health and safety programs administered by
the Centers for Disease Control and Prevention; primary health care services provided by the
Health Resources and Services Administration; health insurance for federal employees
administered by the Office of Personnel Management; and the regulation of pharmaceuticals,
medical devices, and food products conducted by the Food and Drug Administration. The most
significant drivers of spending in this function are Medicaid and the exchange subsidies created in
the Patient Protection and Affordable Care Act—commonly known as Obamacare.
BUDGET FUNCTION 570: MEDICARE
The Medicare function includes only the Medicare program, which provides health insurance to
senior citizens and certain persons with disabilities. Nearly 99% of spending in this function
occurs on the mandatory side of the budget, and almost all of the mandatory spending consists of
payments for Medicare benefits. The balance of spending is discretionary annual appropriations
covering the cost of administering and monitoring the Medicare program.
BUDGET FUNCTION 600: INCOME SECURITY
The Income Security function covers a range of income security programs that provide cash or
near-cash assistance to low-income persons and benefits to certain retirees, persons with
disabilities, and the unemployed.
BUDGET FUNCTION 650: SOCIAL SECURITY
The Social Security function consists of the payroll-tax-financed programs collectively known as
Social Security: Old-Age and Survivors Insurance and Disability Insurance. These programs
provide monthly cash benefits to approximately 61 million retired and disabled workers and their
spouses, dependents, and survivors. This function includes both benefit payments and funds to
administer the programs and ensure program integrity.
BUDGET FUNCTION 700: VETERANS’ BENEFITS AND SERVICES
Congressional Research Service
49
Discretionary Budget Authority by Subfunction: An Overview
The Veterans’ Benefits and Services function includes health administration and health services
for veterans (majority of the discretionary spending), their pensions and disability compensation
(majority of the mandatory spending), and other services our nation provides to veterans.
BUDGET FUNCTION 750: ADMINISTRATION OF JUSTICE
The Administration of Justice function includes programs to ensure civil rights protections and
provide judicial services, police protection, law enforcement, rehabilitation and incarceration of
criminals, and the general maintenance of domestic order.
BUDGET FUNCTION 800: GENERAL GOVERNMENT
The General Government function includes the activities of the White House and the Executive
Office of the President, the legislative branch, and programs to carry out the administrative
responsibilities of the federal government, including personnel management, fiscal operations,
and property control.
BUDGET FUNCTION 900: NET INTEREST
The Net Interest function contains the interest paid to private and foreign government holders of
U.S. Treasury securities. This function includes interest on the public debt less the interest
received by the federal government from trust fund investments and loans to the public. It
contains mandatory payments, with no discretionary components.
BUDGET FUNCTION 920: ALLOWANCES
The Allowances function displays the budgetary effects of proposals that cannot be easily
distributed across other budget functions.
Author Information
D. Andrew Austin
Analyst in Economic Policy
Acknowledgments
Comments and conversations with many CRS colleagues were invaluable. The author wishes to thank
David Bearden, Corrie Clark, Benjamin Collins, Cassandria Dortch, Darryl Getter, Angela Jones, Katie
Jones, Bob Kirk, Karen Lynch, Brendan McGarry, Emily McCabe, Maggie McCarty, Dan Morgan, Will
Morton, Anna Normand, Sidath Viranga Panangala, Lisa Sacco, John Sargent, Kavya Sekar, Rebecca
Skinner, Jessica Tollestrup, and Carol Hardy Vincent.
Congressional Research Service
50
Discretionary Budget Authority by Subfunction: An Overview
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
shared staff to congressional committees and Members of Congress. It operates solely at the behest of and
under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
than public understanding of information that has been provided by CRS to Members of Congress in
connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not
subject to copyright protection in the United States. Any CRS Report may be reproduced and distributed in
its entirety without permission from CRS. However, as a CRS Report may include copyrighted images or
material from a third party, you may need to obtain the permission of the copyright holder if you wish to
copy or otherwise use copyrighted material.
Congressional Research Service
R41726 · VERSION 23 · UPDATED
51
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.