What is the Congressional Budget Office?

CBO plays a vitally important role in the federal budget process. CBO was established as a nonpartisan agency under the Congressional Budget and Impoundment Control Act of 1974, which organized the budget process in the legislative branch. Prior to that law, the president’s Office of Management and Budget (OMB) was the primary source of budgetary and economic information for the federal government.

CBO’s core mission is to provide nonpartisan and independent analyses to the Congress about the budget and economy, thus improving the transparency and openness of the budget process. The agency develops and updates a baseline projection of revenues, spending, and the economy under current law, which serves as a benchmark for Congress’ legislative activity. Prior to a vote by the House or the Senate on legislation, CBO prepares estimates of the bill’s budgetary impact. CBO’s analyses are nonpartisan and reflect objective data and information. CBO does not make recommendations. The agency works most closely with the Congressional committees responsible for budget, appropriations, and tax legislation. Members of Congress rely on CBO’s analyses and feedback of legislative proposals as they craft legislation. CBO also prepares numerous reports on emerging economic developments and the key challenges facing the federal budget.

In the exercise of its responsibilities, CBO often gets criticized by members who challenge their estimates. These members are often seeking to pressure CBO to provide more “favorable” scoring of their proposals. These criticisms actually are a testament to the important role that CBO plays in the budget process. CBO is an unbiased “referee” in the Washington’s budget battles, and, like all referees, it is sometimes criticized for the calls it makes. While proponents may be quick to complain about the CBO cost estimates that apply to their own favored proposals, they often sing CBO’s praises when legislation they oppose receives an unfavorable score.

For more information about the budget process, please visit PGPF’s Understanding the Budget.