Congressional Budget Office (CBO) is a federal agency within the legislative branch of the United States government. It is a government agency that provides the Congress objective, unbiased, and timely analyses to aid it in economic and budgetary decisions on programs covered by the federal budget. The CBO provides information and estimates required for Congressional budget processes. It also produces policy analyses, cost estimates of legislation, and budget and economic projections that help the Congress in making decisions relating to spending and taxes. The CBO scrutinizes every piece of legislation affecting the use of the nation’s resources. The Congress calls on CBO to estimate the cost of proposed legislation and to identify and evaluate legislative mandates on state, local, and tribal governments and the private sector. The CBO also provides up-to-date data on its web site, including current budget and economic projections and information on the status of discretionary appropriations.
The CBO was founded on July 12, 1974, with the enactment of the Congressional Budget and Impoundment Control Act (P.L. 93-344). The agency began operating on February 24, 1975. The CBO is located on the fourth floor of the Ford House Office Building in Washington, D.C. It is headed by the CBO Director who oversees the agency’s work. The Speaker of the House of Representatives and the President pro tempore of the Senate jointly appoint the CBO Director, after considering recommendations from the two budget committees. The term of office is four years. There is no limit on the number of terms a Director may serve. However, either House of Congress may remove the Director by a resolution. At the expiration of a term of office, the person serving as Director may continue in the position until his or her successor is appointed.
The following are the responsibilities of the CBO:
- Economic forecasting and fiscal policy analysis: The CBO provides periodic forecasts and analyses of economic trends and alternative fiscal policies.
- Scorekeeping: When the Congress establishes targets or ceilings for overall expenditures for budget authority and sets levels of revenues, deficit, and public debt, the CBO “keeps score” for Congress by monitoring the results of congressional action on individual authorization, appropriation, and revenue bills against the targets that are specified.
- Cost projections: The CBO is required to develop five-year cost estimates for carrying out any public bill or resolution reported by congressional committees. At the beginning of each fiscal year, CBO also provides a five-year projection on the costs of continuing current federal spending and taxation policies.
- Annual Report on the Federal Budget: The CBO furnishes the House of Representatives and Senate Budget Committees, usually by April 1 of each year, with a report. This includes a discussion of alternative spending and revenue levels and alternative allocations among major programs and functional categories, in light of major national needs and its effect on balanced growth and development.
- Special Studies: The CBO also undertakes special studies that Congress requests on budget-related areas.