Advance Appropriations, Forward Funding, and Advance Funding

Prepared for Members and Committees of Congress

uring consideration of recent appropriations measures, one long-standing but obscure
budget practice—advance appropriations—received considerable attention. In a time of
budgetary constraints, advance appropriations provide opportunities to include spending D

in appropriations measures that are not immediately counted. Two related, but less discussed
practices, are forward funding and advance funding. See
guidehome.shtml for more information on federal budget process.
Appropriations measures generally make budget authority (or BA)1 available for use (or
obligation) at the start of the fiscal year covered by the measure. For example, the FY2002
appropriations acts generally made budget authority available on October 1, 2001. Sometimes
appropriations bills provide a different starting date for specified budget authority within the act
so that the funding cycle does not coincide with the fiscal year generally covered by the act.
There are three types of this kind of budget authority: advance appropriations, forward funding,
and advance funding.
Advance appropriations means that budget authority becomes available one or more fiscal years
after the fiscal year covered by the act. An advance appropriation in a FY2002 appropriations act
could have provided that the budget authority for specified activities would not become available
until October 1, 2002—the start of FY2003—or later.
Advance appropriations are generally scored2 in the fiscal year the funds first become available.
Therefore, an advance appropriation (and resulting outlays) for FY2003 that was included in a
FY2002 appropriations act would be included for calculating total budget authority and outlays
for FY2003, but not FY2002. The funds would not be included in calculations to determine if the
appropriation violated the FY2002 spending ceilings established in the Congressional Budget and 3
Impoundment Control Act of 1974 or additional spending ceilings associated with the annual
budget resolution.
Forward funding generally becomes available for obligation in the last quarter of the fiscal year
of the appropriations act and the availability continues the following fiscal year. Forward funding
in a FY2002 appropriations act could have provided that the budget authority for specified
activities would not become available until July 1, 2002, and would remain available through

1 Budget authority is the authority provided by federal law to incur financial obligations that will result in immediate or
future expenditures (or outlays) involving federal funds. Examples of financial obligations are entering into a contract
to build a submarine or purchase supplies.
2 Scoring refers to estimates of budget authority, outlays, revenues, and deficit levels resulting from congressional
budgetary action. These estimates are usually prepared by the Congressional Budget Office and Office of Management
and Budget and compare congressional action to targets and ceilings, such as budget resolution spending ceilings.
3 2 U.S.C. 621-645; P.L. 93-344, as amended. Section 303 of the Congressional Budget Act exempts certain advanced
appropriations from the prohibition against considering spending legislation until after Congress has agreed to the
budget resolution for the fiscal year. For more information on Congressional Budget Act points of order, see CRS
Report 97-684, The Congressional Appropriations Process: An Introduction, by Sandy Streeter, and CRS Report 97-
865, Points of Order in the Congressional Budget Process, by James V. Saturno.

This budget authority is scored in the fiscal year in which it first becomes available. Budget
authority in a FY2002 appropriations act would be included in the FY2002 calculations. Since
forward funding generally becomes available near the end of the fiscal year, the Office of 4
Management and Budget and Congressional Budget Office may estimate that most of the outlays
will occur in subsequent fiscal years. Such forward funding outlays would not be scored for the
first fiscal year, but would be scored for subsequent fiscal years.
Advance funding is budget authority authorizing obligations late in the fiscal year, if needed.
However, unless used, the budget authority is charged to the succeeding fiscal year. Advance
funding is contingency funding for a few programs that require federal payments in which the
funds are borrowed from the succeeding fiscal year.
Advance funding is used to fund benefit payments that are difficult to predict, such as
unemployment compensation. An appropriations act would provide a specific amount of budget
authority, but would also state that, if needed, an agency may obligate additional funds to meet
benefit needs. If advance funding is used, budget authority for that fiscal year is increased by the
amount obligated and budget authority for the succeeding fiscal year is reduced by that amount.
Sandy Streeter
Analyst on the Congress and Legislative Process, 7-8653

4 Outlay estimates are used in scoring appropriations measures for enforcing certain Congressional Budget Act points
of order, and in calculating the federal deficit. Information on actual outlays is not available until the fiscal year is
completed. OMB and CBO provide outlay estimates for each appropriation based on historical patterns.