The mission of the Congressional Budget Office (CBO) is to provide the Congress with the objective, timely, nonpartisan analysis needed for economic and budget decisions and the information and estimates required for the Congressional budget process. This section describes the policies and procedures that CBO follows as it prepares and distributes budget estimates and other analytic work for the Congress.

CBO's Statutory Responsibilities

The basic statute setting forth the duties and functions of the Congressional Budget Office is title II of the Congressional Budget Act of 1974. Additional responsibilities for budget estimates are contained in titles III and IV of that act. Subsequent legislation has affected those responsibilities and has added further requirements for specific analyses.

According to title II of the Budget Act, CBO's primary duty is to provide budget-related information to all committees of both Houses, with priority given first to the information needs of the Committees on the Budget and second to the information needs of the Committees on Appropriations, Ways and Means, and Finance. With respect to individual Members, the only CBO duty stipulated in the act is to provide information compiled for committees and additional related information that may be requested.

Title II also requires CBO to prepare several specific reports to the Committees on the Budget each year, including periodic assessments of the economic and budget outlook, and to conduct continuing studies on budgetary matters.

Titles III and IV of the Congressional Budget Act specify additional duties for CBO to carry out in reviewing bills or joint resolutions reported from committees of either House. Title III covers all bills or joint resolutions that provide new budget or spending authority, such as appropriation bills, or that provide an increase or decrease in revenues. Title IV covers all bills and joint resolutions other than appropriation bills and private relief bills. Under those titles, CBO must prepare estimates of new budget authority, outlays, or revenues provided by the bills or joint resolutions, or of the costs that the government would incur in carrying out the provisions of the proposed legislation. The CBO cost estimates are to be included in the reports accompanying such bills or resolutions if they are submitted to the committees before the reports are filed.

For estimating the impact on revenues of legislation involving income, estate and gift, excise, and payroll taxes, the Congressional Budget Act directs CBO to use exclusively the revenue estimates of the Joint Committee on Taxation.

The Balanced Budget and Emergency Deficit Control Act of 1985, the Balanced Budget and Emergency Deficit Control Reaffirmation Act of 1987, and the Budget Enforcement Act of 1990 assign further duties to the Congressional Budget Office, such as providing budget estimates for the purpose of budget control. That function includes preparing the various sequestration reports to the Congress and the Office of Management and Budget. The Budget Enforcement Act also requires CBO to estimate changes in direct spending and revenues for private relief legislation as well as for public bills or joint resolutions.

The Unfunded Mandates Reform Act of 1995 requires CBO to prepare estimates of the direct costs of all federal mandates that are contained in legislation reported by any authorizing committee in either House and that affect state, local, and tribal governments or the private sector. The act also authorizes CBO to prepare analyses and studies of the budgetary or financial impact of proposed legislation that may significantly affect state and local governments or the private sector, to the extent practicable, at the request of any committee.

From time to time, statutes have directed CBO to prepare analytic reports on specific subjects. Such reports have included the treatment of administrative costs under credit reform accounting, the financial risks posed by government-sponsored enterprises, and the desirability and feasibility of privatizing the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.

How Work on CBO's Budget Estimates and Analyses Is Initiated

The Congressional Budget Office strives to provide federal budget and mandate cost estimates for all bills other than appropriation bills when they are reported by a full committee of either House. Committee staff should notify CBO when bills are about to be ordered reported and when cost estimates are needed.

CBO also prepares cost estimates for proposals at other stages of the legislative process at the request of a committee of jurisdiction, a budget committee, or the Congressional leadership. For example, CBO may prepare cost estimates for a series of bills to be considered by a subcommittee, including draft bills not yet introduced, or for amendments to be considered during committee markups. Similarly, it may prepare cost estimates for floor amendments and for bills that pass one or both Houses.

For appropriation bills, CBO provides estimates of outlays that would result from the provision of budget authority. CBO also provides the budget and appropriation committees with frequent tabulations of Congressional action on both spending and revenue bills so that the Congress can know whether it is acting within the limits set by the annual budget resolution.

In addition to statutory reports, or analyses done to directly support CBO's statutory work, the office undertakes a number of other analyses each year, although only at the request of the Chairman or Ranking Minority Member of the relevant committee or subcommittee or the Congressional leadership. Also, as time permits, CBO will honor requests of individual Members for cost information or other analysis of legislative proposals, but it must give priority to committee requests.

By way of definition, a committee request consists of a written or oral request by the Chairman or Ranking Minority Member of a committee or subcommittee. CBO asks that requests from individual Members be made in writing.

Consultation with Committees and Other Requesters

When undertaking a cost estimate or an analysis supporting such an estimate, CBO analysts contact the staff of the committee of jurisdiction and, when applicable, the staffs of the Member sponsoring the proposal and the Member requesting the estimate to gather background information and discuss the schedule for completing the estimate. Budget and mandate cost estimates are based on the text of the proposed legislation. CBO analysts consult with the staff of the committee of jurisdiction (for a reported bill) or the sponsoring Member (for an introduced bill or amendment) when questions of interpretation arise, but they draw their own conclusions on an impartial and objective basis.

CBO analysts contact the appropriate staff members if a forthcoming CBO estimate shows direct spending costs, mandates that exceed the legislative thresholds, or other significant findings. CBO, however, does not make judgments about the application of parliamentary points of order. After CBO cost estimates have been transmitted, they may be revised to correct errors or to incorporate new or updated information.

When undertaking requested analyses of legislative proposals or issues, CBO staff members consult with the requester's staff to reach an understanding of the scope and nature of the work to be done. CBO analysts draw their own conclusions on an impartial and objective basis, as they do when preparing cost estimates. When appropriate, CBO staff inform other relevant committees of requests for analytic work after advising the requester's staff. As a final step in the consultation process, CBO informs the requester's staff of the results of the analysis before it releases the material.

Sources of Information and Peer Review Practices

In preparing its budget estimates and analyses, CBO uses the rich data sources available from the government's statistical agencies. Those sources include the national income and product accounts, the census of manufacturers, the Statistics of Income, the Current Population Survey, and various national health surveys. CBO also uses information provided by relevant government agencies and industry groups to meet specific needs.

CBO employs standard methods of economic analysis and closely follows theoretical and empirical developments in the professional literature for economics and related disciplines. In addition, CBO frequently calls on outside experts for advice on specific analytic matters, such as the outlook for agriculture production, spending projections for Medicare and Medicaid, and business prospects in the telecommunications industry. For its economic forecasts and assumptions, CBO draws on the advice of a distinguished panel of advisers that meets twice a year.

All CBO estimates and analytic products are reviewed internally for technical competence, accuracy of data, and clarity of exposition. CBO studies are also reviewed by experts outside CBO, and the preface to each study cites the many contributors who helped shape the final product. Although outside experts and advisers provide considerable assistance, CBO is solely responsible for the accuracy of the estimates and analyses that it produces. In keeping with its nonpartisan status and its mandate to provide objective analysis, CBO does not make policy recommendations in any of its analyses.

Disclosure of CBO's Assumptions and Methodologies

Both the Congressional Budget Act and the Unfunded Mandates Reform Act direct CBO to disclose the basis for each budget and mandate cost estimate. CBO interprets that directive to include the disclosure of the critical assumptions and analytic methodologies used to prepare the estimate. All written cost estimates include explanations of the basis of the estimate, and CBO supplies further details on request. Similar explanations of critical assumptions and methodologies are given in CBO's analytic products. It is CBO's policy that its estimates and analyses be clearly presented and easy to understand.

Transmission of CBO's Work to the Congress

CBO seeks to ensure that key parties in the Congress who are involved in any particular issue have equal access to its analytic work. Insofar as possible, CBO delivers its cost estimates and analyses to all interested parties simultaneously. Requests for confidentiality are honored only for cost estimates for legislative proposals that have not been made public.

The Director of the Congressional Budget Office transmits by letter all formal budget and mandate cost estimates of legislative proposals and all requested analyses. CBO sends its formal cost estimates for reported bills and estimates prepared at committee request to the Chairman and Ranking Minority Member of the reporting or requesting committee. When the requester is a budget committee or individual Member, CBO sends a copy of its cost estimate simultaneously to the Chairman and Ranking Minority Member of the committee of jurisdiction; for an introduced bill or amendment, a copy of the estimate is sent to the sponsor as well as the requester. Cost estimates of legislative proposals that have not been introduced as a bill or made public are transmitted only to the sponsoring Member or requesting committee unless CBO is directed otherwise.

In contrast, informal cost estimates may be transmitted directly by CBO staff. Informal estimates are preliminary because they do not undergo the same review procedures required for formal estimates.

Distribution of CBO's Estimates and Analyses

CBO makes its analytic work widely available to Members of Congress and their staffs as well as to the public. The Publications Office sends a copy of all CBO reports and studies to each Member. Copies of CBO papers, memorandums, and other analyses are available to Members and Congressional staff on request.

The Publications Office also handles requests from the general public, other government agencies, and the press. Single copies of CBO reports, studies, papers, and memorandums are available at no charge. In addition, the Superintendent of Documents at the U.S. Government Printing Office carries many CBO reports and studies.

In September 1997, CBO launched its World Wide Web site (www.cbo.gov). The site now includes publications, testimony, and cost estimates issued since then as well as many publications from previous years. As time and resources permit, CBO will continue to post older products that remain relevant and useful. An index of publications issued since CBO began operating in 1975 is available: http://www.cbo.gov/pubs-sub.pdf

The documents on CBO's Web site are available in three formats: HTML, PDF, and WordPerfect. The multiformat approach makes CBO's products accessible to a wide variety of users and for multiple purposes. Visitors can browse, search, download, and print documents that are on the Web. They can also subscribe to CBO's ListServer, a feature that enables them to be notified by E-mail when CBO issues a publication on a subject of interest to them.