The congressional appropriations process is how the federal government gets legal permission to spend money each year. Under the Constitution, no dollar can leave the U.S. Treasury unless Congress has passed a law authorizing it, which puts the power of the purse squarely with the legislative branch. In practice, Congress actively debates and votes on roughly one-third of federal spending each year through twelve annual funding bills; the rest flows automatically under permanent laws that created programs like Social Security and Medicare.
Why Congress Controls Federal Spending
Article I, Section 9, Clause 7 of the Constitution, known as the Appropriations Clause, states that no money may be drawn from the Treasury except through appropriations made by law.1Legal Information Institute. U.S. Constitution Annotated – Article I, Section 9, Clause 7 – Appropriations Clause The framers put this power in the legislative branch so that no single official could control the national treasury. The clause also requires the government to publish regular accounts of receipts and expenditures.
Courts enforce this limit strictly. In OPM v. Richmond (1990), the Supreme Court held that even when a federal employee gives someone bad advice about benefits, no court can order a payment Congress never authorized.2Legal Information Institute. Office of Personnel Management v. Richmond The rule is simple: no appropriation, no spending.
What Gets Voted On Each Year and What Doesn’t
Federal spending splits into two categories, and only one of them runs through the annual appropriations process.
Mandatory spending, sometimes called direct spending, flows under permanent statutes that entitle anyone meeting the criteria to receive benefits. Social Security, Medicare, Medicaid, and veterans’ benefits work this way. Congress doesn’t vote on those payments annually; the money goes out automatically based on eligibility rules already written into law. Mandatory spending makes up roughly two-thirds of all federal outlays.3U.S. Treasury Fiscal Data. Federal Spending Interest on the national debt sits alongside it as a legal obligation that must be paid.
Discretionary spending is everything that requires new legislation each year. National defense, federal law enforcement, education grants, scientific research, infrastructure, and the operations of most federal agencies all depend on Congress passing fresh funding bills.3U.S. Treasury Fiscal Data. Federal Spending If those bills stall, the affected programs lose their legal authority to spend. Changing a mandatory program requires amending its underlying statute, which typically happens through a separate expedited procedure called budget reconciliation rather than through the appropriations bills discussed here.
The Annual Appropriations Cycle
Discretionary funding runs on a structured yearly cycle built around twelve appropriations bills, each covering a different slice of the government: defense, agriculture, transportation, homeland security, and so on. The fiscal year begins October 1, and the twelve bills are supposed to be enacted before then.
Setting the Top-Line Numbers
The process begins when the Appropriations Committees in the House and Senate receive total spending limits from a budget resolution. Those ceilings, called 302(a) allocations, cap how much each committee can distribute overall. When Congress can’t pass a budget resolution, which happens frequently, each chamber can adopt a “deeming resolution” instead to set the limits and keep work moving.
Dividing Money Among Subcommittees
Each Appropriations Committee then splits its overall allocation among its twelve subcommittees through 302(b) allocations. These sub-allocations pass by committee vote and never go to the full House or Senate. Once a subcommittee knows its ceiling, it holds hearings where agency officials justify their requests, then marks up a bill line by line. After the subcommittee votes, the bill moves to the full Appropriations Committee for further debate and amendments.
Floor Votes and Reconciling Two Versions
Each chamber then considers the bill on the floor, where members can offer further amendments. The House and Senate almost always pass different versions of the same funding bill, so the two versions must be reconciled. That happens either through a formal conference committee or through back-and-forth exchanges of amendments between the chambers. Negotiators settle dollar figures and policy language until both chambers approve identical text.
When the twelve individual bills can’t clear on their own timelines, leadership often bundles several or all of them into an omnibus package for a single up-or-down vote. A partial bundle covering just a handful of bills is sometimes called a minibus.
The Three Kinds of Spending Legislation
Congress uses several distinct vehicles to fund the government, each fitting a different situation.
- Regular appropriations acts. The twelve individual bills, or the omnibus and minibus packages that combine them, fund discretionary programs for the full fiscal year starting October 1.
- Continuing resolutions. When regular bills aren’t enacted by the October 1 deadline, a continuing resolution keeps the government funded, usually at the prior year’s spending levels, for a set period. Congress has relied on CRs so heavily that operating under one at the start of a fiscal year has been the norm rather than the exception since the early 1980s. Because a CR typically freezes spending at prior-year levels, agencies can’t start new programs or adjust to changed circumstances until a full-year bill passes.4Congress.gov. Past Government Shutdowns – Key Resources
- Supplemental appropriations acts. These bills address unforeseen needs that arise outside the annual cycle, such as natural disasters, military operations, or public health emergencies. They add funding on top of the levels already set in the regular bills.
What the President Does
Presidential involvement starts each year on the first Monday in February, when the administration submits a formal budget request to Congress.5U.S. House Committee on the Budget. Time Table of the Budget Process The document lays out the administration’s priorities and proposed funding levels for every agency. Congress is free to ignore it, and often does, but it sets the opening terms of negotiation and signals where a veto might land.
Once Congress passes a spending bill, the President has ten days (excluding Sundays) to sign or veto it.6Legal Information Institute. U.S. Constitution Annotated – The Veto Power After signing, the Office of Management and Budget apportions the funds to agencies. Apportionment is a legally binding schedule controlling how much an agency can obligate and when. Agencies must submit apportionment requests to OMB, and no obligation can be incurred without an approved apportionment in place.7Office of the Law Revision Counsel. 31 USC 1517 – Prohibited Obligations and Expenditures
When the Process Breaks Down: Shutdowns
If Congress fails to pass either a full-year spending bill or a continuing resolution before October 1, agencies that depend on annual appropriations lose their legal authority to spend. The Anti-Deficiency Act then forces those agencies to cease operations that aren’t essential to protecting human life or property.8U.S. Office of Personnel Management. Guidance for Shutdown Furloughs That’s a shutdown.
Federal employees fall into two groups. “Excepted” employees, those performing work tied to safety, national security, or functions Congress has authorized to continue, keep working but do not receive pay until new funding passes. Everyone else is furloughed, placed in a temporary nonduty, nonpay status.8U.S. Office of Personnel Management. Guidance for Shutdown Furloughs Whether furloughed employees get back pay depends on Congress passing legislation authorizing it after the fact.
Mandatory spending programs like Social Security and Medicare generally keep running during a shutdown because their spending authority doesn’t expire. Some discretionary programs also survive if they were funded through multi-year or advance appropriations with remaining balances. Shutdowns have become routine: the most recent one began October 1, 2025, lasted 42 days, and was the longest in U.S. history, followed by additional funding lapses in early 2026 as remaining bills stalled.4Congress.gov. Past Government Shutdowns – Key Resources
Limits on Spending and Withholding by the Executive
The Anti-Deficiency Act puts teeth behind the whole framework. Federal employees are prohibited from spending money before an appropriation exists or in amounts that exceed what Congress authorized, and the same prohibition covers exceeding an OMB-approved apportionment.9Office of the Law Revision Counsel. 31 USC 1341 – Limitations on Expending and Obligating Amounts Violations trigger mandatory reporting to the President, Congress, and the Comptroller General. Administrative discipline can include suspension without pay or removal. An employee who knowingly and willfully violates the Act faces a fine of up to $5,000, imprisonment for up to two years, or both.10Office of the Law Revision Counsel. 31 USC 1350 – Criminal Penalty Criminal prosecutions are rare, but the threat keeps agency budget offices careful.
The other direction matters too. Once Congress appropriates money, the President cannot simply refuse to spend it. The Impoundment Control Act of 1974 requires that any proposal to permanently cancel appropriated funding, called a rescission, be sent to Congress in a special message detailing the amount, affected programs, and reasons. The money must be released for spending unless Congress passes a rescission bill within 45 days. Funds released under this process cannot be proposed for rescission again.11Office of the Law Revision Counsel. 2 USC 683 – Rescission of Budget Authority
The President can also temporarily delay spending, called a deferral, but only for narrow reasons: contingency reserves, savings from improved efficiency, or when a specific law permits it. Deferrals cannot extend past the end of the fiscal year.12Office of the Law Revision Counsel. 2 USC Ch. 17B – Impoundment Control The Comptroller General reviews all proposed deferrals and reports findings to Congress. If the executive withholds funds without following the correct procedure, the Comptroller General can file a civil lawsuit in federal court to force their release.13U.S. Government Accountability Office. Impoundment Control Act
Riders: Telling Agencies What Not to Spend On
Appropriations bills don’t only assign dollars. They routinely include provisions restricting how those dollars can be used. These “limitation riders” date to the 1870s and function as a second layer of congressional control. Rather than passing a separate law to block an agency action, Congress simply forbids the agency from spending any money on it.
Some restrictions appear in annual bills year after year. Common recurring prohibitions include bans on using federal funds for unauthorized publicity campaigns, for employee training unrelated to job performance, or for paying contractor bonuses when work falls below acceptable standards.14U.S. Department of Justice. Award Condition – General Appropriations-Law Restrictions on Use of Federal Award Funds Riders also require federal computer networks to block access to pornography and prohibit nondisclosure agreements that would override whistleblower protections. These provisions give Congress fine-grained control over agency behavior without amending the underlying statutes that created those agencies.
Who Watches the Money
The Government Accountability Office is Congress’s watchdog over federal spending. GAO issues legal opinions and decisions to Congress and to agencies on whether public funds are being used properly, including rulings on potential Anti-Deficiency Act violations.15U.S. Government Accountability Office. Appropriations Law When an expenditure raises legal questions, GAO’s opinion often becomes the definitive word.
GAO also publishes Principles of Federal Appropriations Law, commonly called the Red Book, a multi-volume treatise on federal fiscal law. It covers the principles governing use of appropriated funds and the exceptions and penalties that apply when those principles are violated.16U.S. Government Accountability Office. The Red Book Agency budget officers, congressional staff, and federal lawyers turn to it first when a spending question doesn’t have an obvious answer.