May 9, 2018

The nonpartisan Congressional Budget Office has updated its annual baseline for discretionary spending to use the account-level totals in the recently enacted omnibus appropriations bill for fiscal 2018 as a starting point.

CBO issued its annual baseline on April 9, but since the omnibus was only enacted on March 23, there was not time to update account-level data to reflect the numbers in the omnibus as a starting point. Instead, the starting point was the continuing resolution that funded programs at the pro-rated FY 2017 enacted level.

For example, the spreadsheet of account-level numbers released by CBO on April 9 (and still on their website) shows the TIGER (now BUILD) discretionary grant program as getting $500 million in 2018, and that total is given an annual inflation adjustment every year thereafter. But TIGER got $1.5 billion in the final omnibus bill, not $500 million.

While the old account-level data is still on the CBO website, the updated post-omnibus discretionary baseline has now been given to Congressional committees. And the difference, especially in transportation, is massive.

Budget function 400 (transportation) includes:

• Everything at the Department of Transportation except the Maritime Administration’s defense-related Security Program account.
• The Transportation Security Administration.
• The U.S. Coast Guard except for the Environmental Compliance and Restoration account and a defense-related portion of the Operations account.
• NASA’s Aeronautics account.
• A few small odds and ends (FMC, NTSB, STB, Amtrak Inspector General).

Full totals for every discretionary account for function 400 in the new baseline can be downloaded in this document, but comparing the pre- and post-omnibus totals is staggering. The extra spending added to the omnibus at the 11th our added an average of $11 billion per year to the discretionary baseline for transportation spending.

(Both the pre- and post-omnibus baselines include $1.8 billion in one-time 2018 emergency spending, and a few rescissions, that by law have to be carried over and inflated into future years.)

The account-level discretionary spending in the baseline, if all added together, adds up to a lot more starting in 2020 than the spending caps under the Budget Control Act will allow (the overall totals in the summary report reflect the cap levels). But that’s a problem for next year.

The updated discretionary baseline data also reveals the specifics of the spending assumptions behind CBO’s updated Highway Trust Fund cash flow baseline, which shows that, at the 2018 enacted HTF obligation levels plus annual inflation, the Trust Fund will need about $166 billion in additional deposits ($119 billion to get the Highway Account to a zero balance, $42 billion to get the Mass Transit Account to the same, and a $5 billion cash cushion to prevent day-to-day defaults in August and September 2028).

The Highway Trust Fund baseline only shows outlays and does not show the obligation authority assumptions on which the outlays are predicated. Those obligation limitations (and the small bit of truly mandatory funding exempt from limitation, which is adjusted downwards for sequestration in 2018 and 2019 (and will also be adjusted downwards for sequestration in future years, but those calculations have not been made yet) are shown below.