Spending Authority Recordings in Certain Revolving Funds Impair Congressional Budget Control
Highlights
Program administrators use budget authority to borrow amounts from Treasury or non-Treasury sources to finance their revolving fund loan programs. In some cases, this authority represents authorized net borrowings (gross borrowings less repayments) rather than authorized gross borrowings. As a consequence of this procedure, a program's gross borrowings in a fiscal year can easily exceed its recorded borrowing authority for the year. This gap between authority recorded in the budget and total borrowings can increase in succeeding years as recordings of borrowing authority are used for several cycles of borrowings, rolled over. For the fiscal years 1932-79, total actual borrowings from Treasury were an amount almost twice the amount of recorded authorizations. Programs in 22 accounts spanning 12 Federal departments and agencies had followed this procedure in 1979. These programs had outstanding borrowings from Treasury totaling about $96 billion.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| Congress, in reviewing revolving fund loan programs, should place specific limits on the gross obligations, or gross loan obligations, authorized to be made and require that such limits be treated as the relevant budget authority amounts. |
Closed – Not Implemented
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When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information. |
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Office of Management and Budget | The Director of the Office of Management and Budget should revise the way the definition of budget authority is applied to revolving fund loan programs so that budget authority for these programs is the amount of gross obligations, or gross loan obligations, authorized to be made. |
Closed – Not Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
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