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Thursday, February 14, 2013

The American Taxpayer Relief Act of 2012: Modifications to the Budget Enforcement Procedures in the Budget Control Act

Bill Heniff Jr.
Analyst on Congress and the Legislative Process

The Budget Control Act of 2011 (BCA; P.L. 112-25) established, among other things, statutory limits on discretionary spending and an automatic process of spending reductions if Congress and the President did not enact deficit reduction legislation by January 15, 2012.1 Both of these procedures involve sequestration—the automatic, largely across-the-board cancellation of previously-enacted budgetary resources. The American Taxpayer Relief Act of 2012 (ATRA, P.L. 112-240), signed into law on January 2, 2013, however, made substantive modifications to these procedures, affecting the possible sequestration of budgetary resources in FY2013.

Perhaps the most important modifications were to postpone, but not cancel, any potential sequestration of FY2013 resources. To summarize, the ATRA postponed the so-called BCA sequester, originally scheduled for January 2, 2013, until March 1, 2013, and postponed the enforcement of the statutory limits on discretionary spending for FY2013 (i.e., through a sequester), originally scheduled for 15 days after Congress adjourns to end a session, until March 27, 2013 (see Table 1). In addition, the ATRA reduced the amount of the spending reductions in FY2013 resources under the BCA sequester by $24 billion and reduced the statutory limits for FY2013 and FY2014 by a total of $4 billion and $8 billion, respectively. This report provides a brief summary of these modifications.

Date of Report: February 4, 2013
Number of Pages: 5
Order Number: R42949
Price: $19.95

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