Reconciliation Lessons Learned: Build the Budget Resolution Around the Reconciliation Bill, Not the Other Way Around

The budget resolution no longer serves as an effective fiscal blueprint. Instead, it has become a procedural gateway to reconciliation. Lawmakers who want to see the best possible reconciliation bill signed into law should first negotiate the contours of the underlying legislation and then tailor the budget resolution to accommodate the desired reconciliation policy.

Budget Resolutions Are Now for Reconciliation

The Congressional Budget Act of 1974 imagined a budget process that would be followed step by step each year. That overly prescriptive process has rarely been followed in the last 50 years. Congress and the Executive Branch have shed, formally and informally, many aspects of the Budget Act.

This includes the annual budget resolution, which was meant to be adopted by Congress to provide a comprehensive fiscal plan for lawmakers each year. Today, the primary purpose of a budget resolution is to unlock the reconciliation process. Reconciliation allows changes to tax and spending laws to pass through both chambers of Congress with majority votes, rather than the usual 60-vote filibuster threshold in the Senate.

In the last 30 years, only one budget resolution has been adopted that did not provide reconciliation instructions (FY 2009). Since FY 1996, Congress has adopted 17 budget resolutions; 16 included reconciliation instructions, producing 13 enacted reconciliation laws. This evidence shows that modern budget resolutions exist to enable reconciliation.

Several of these adopted budget resolutions were “shell” budgets, resolutions that only included minimal changes from the baseline and were just meant for the purpose of beginning the reconciliation process.

Will Congress ever again adopt a budget resolution that is not functionally a vehicle for reconciliation? Both history and underlying issues with the Budget Act indicate that it is unlikely.

Reconciliation has grown in importance as a procedural tool to advance specific legislative priorities. Legislators will want to maximize their chances of successfully advancing policies through the complicated and arcane reconciliation process.

While the Congressional Budget Act envisions that the budget resolution should be adopted before negotiations on a reconciliation bill begin, this sequence does not need to be followed in practice. A review of recent reconciliation processes shows that a more prudent approach is instead to build the budget resolution around the reconciliation bill.

The “Schoolhouse Rock” Budget Process vs. Reality

The “Schoolhouse Rock” version of the budget process imagines that the House and Senate would adopt a budget resolution by April 15 for the upcoming fiscal year beginning on October 1.

The budget resolution would then set up two legislative tracks for Congress to make law reflecting the budget blueprint by the beginning of the upcoming fiscal year:

1. The House and Senate Appropriations Committees would make changes in discretionary spending through the annual appropriations bills.
2. To make autopilot spending programs and revenues reflect the budget, the budget resolution could include reconciliation instructions for one or more committees in both the House and Senate, requiring them to propose changes to tax and spending laws within their jurisdictions.[1]

Of course, neither the discretionary nor autopilot-and-revenue tracks are truly governed by the budget resolution today. There is a wide gulf between the de jure and de facto budget process.

Since 1985, the direction of fiscal policy has been decided by a series of deals between presidents and Congress, often in response to political conflict centered around inflection points such as the debt limit. For the last 13 years, discretionary spending levels have been set by statutory spending caps (statutory caps were also in effect from FY 1991-2002).

The reconciliation process has not been used to conform all tax and spending policies with the budget. Even reconciliation bills with a broad scope have not taken a “whole of government” approach. Rather, reconciliation has been used (particularly since 2001) to advance discrete legislative priorities.

Congress has passed several important laws in recent years through the reconciliation process. Most recently, President Donald Trump signed the One Big Beautiful Bill  Act (OBBB) into law on July 4, 2025. The OBBB was a decisive win for the American people, not only for its policy achievements, but because it served as a reminder that reconciliation is a powerful tool to advance bold legislative priorities.

Reconciliation presents such an important opportunity that lawmakers should think strategically about how best to set themselves up for success in future efforts.

Lessons Learned: Setting Up Success in Reconciliation

One lesson from recent experience is that following the “official” budget process is often not the best way to set lawmakers up for success in reconciliation.

Behind the Scenes Work

In the “by the book” version of the process, the legislative committees would only begin their work after receiving instructions in the adopted budget resolution. As Senate Democratic Leader Chuck Schumer (D-NY) said in 2021, “In order to start work on a reconciliation bill, the Senate must pass a budget resolution first.”

However, this version of the process does not quite make sense from a wholistic perspective. To include reconciliation instructions in the budget resolution, there must be some behind the scenes work already done, or the House and Senate Budget Committees would not have any indication of how to write the instructions.

If the work to map out the policy outcome is done before moving the budget resolution, it can make the entire process move more smoothly. In 2021, legislative work was clearly done ahead of time before the American Rescue Plan Act became the fastest reconciliation process in history. For example, the Senate Agriculture Committee’s instruction was to increase the deficit by not more than the very specific amount of $22.717 billion. The final bill signed into law by President Biden increased spending in the jurisdiction of the Senate Agriculture Committee by $22.712 billion, almost exactly matching the instruction.

Building Consensus

As Members discovered during the OBBB process, adopting a generic budget resolution and only then figuring out the details of the reconciliation bill afterward can cause serious issues.

The adopted budget resolution for the OBBB was internally inconsistent, providing vastly different reconciliation instructions to House and Senate committees. The final version of the OBBB ended up putting five of the 11 House committees out of compliance with their reconciliation instructions.[2] This indicates a lack of a cohesive vision on the front end of the process for what the reconciliation bill was meant to accomplish.

Owning the Narrative

The messaging vacuum in the time between the adoption of the budget resolution and agreement on the final details of the reconciliation bill can allow opponents to make assertions that may not reflect reality.

During debate on the OBBB, the budget resolution was adopted on April 10, but the first version of the reconciliation bill was not considered in the House until May 22 (42 days later). The final version of the bill was revealed in the Senate on July 1 (82 days later).

During these months of debate, misleading narratives about Medicaid “cuts” and “gutting” Food Stamps dominated the media coverage of reconciliation. Members were put on the defensive from the outset but did not have actual policy details to explain the truth. Congressional Democrats even asked the Congressional Budget Office (CBO) to “score” proposals that were not under consideration, giving the imprimatur of “official” analysis despite the fact the bill did not exist yet.

Preserving Flexibility

As reconciliation legislation is debated internally by the majority party, political and policy considerations can evolve. If these negotiations happen after the budget resolution is adopted, then the reconciliation instructions may prove inadequate. In theory, the budget resolution may be amended to accommodate the new goals, but this process would likely be cumbersome and has not been accomplished before.

An example of the goals of reconciliation changing dramatically mid-process was the 2017 Obamacare repeal and replace effort. In 2016, a reconciliation bill to repeal major provisions of Obamacare was passed by the House and Senate but vetoed by President Obama. The plan going into 2017 was to pass that same bill quickly to fulfill the longstanding Republican campaign pledge to repeal Obamacare. In January 2017, Congress adopted a shell budget featuring reconciliation instructions to accommodate the Obamacare repeal bill.

The political goal soon transformed into replacing Obamacare (rather than simply repealing it). Ultimately, the House and Senate were unable to enact a reconciliation bill.

Congress again encountered issues caused by the mismatched reconciliation instructions and policy goals in 2025. During consideration of the OBBB, certain provisions had to be excluded because they would have implicated the jurisdiction of Senate committees that did not receive reconciliation instructions. For example, government-wide regulatory and federal employee reforms would have triggered Byrd Rule points of order and were left out of the final bill.

The Budget Resolution No Longer Serves as a Tool for Fiscal Planning

The budget resolution has not served as a serious plan for fiscal policy in recent decades. Congressional leaders have instead talked about the budget as an “aspirational” document rather than a blueprint for legislation that was meant to be enacted.

The format for the budget resolution required by the Congressional Budget Act does not even serve the legislative blueprint function well.

As one might expect, the budget resolution is composed of lists of numbers. However, those numbers do not make much sense, even to seasoned lawmakers. The budget resolution uses different concepts and formatting than what is more commonly used by the CBO and other commentators.

For starters, the budget resolution only covers “on budget” programs, a concept that confusingly excludes the largest program run by the federal government, Social Security. This means that the aggregate totals in the budget resolution will differ by more than $1 trillion per year from the actual expenses of the government.

Furthermore, the budget resolution is organized by 20 different functional categories designated by function numbers (such as 150 for International Affairs or 270 for Energy). However, these functional categories do not properly align with House or Senate committee jurisdictions, appropriations bills, or even Executive Branch agencies. This leads to confusion about what the functional totals mean in practical terms for lawmakers. There is significant overlap across committees and agencies within the functions, complicating math, leading to jurisdictional battles, and confounding reconciliation instructions.

Finally, the way the budget resolution is supposed to be enforced is through points of order that require each legislative committee to stay within its assigned budget allocations, called a 302(a) allocation.[3] Each of the authorizing and appropriations committees in the House and Senate receives a 302(a) topline allocation, representing the maximum amount of spending permitted by the committee for the year.

These allocations are not even included in the actual budget resolution on which Congress votes. Rather, the 302(a) allocations are calculated and filed separately by the Chair of the Budget Committee after the budget resolution is adopted. Furthermore, the 302(a) allocations for the authorizing committees are often forgotten and ignored as soon as they are filed, despite their autopilot spending programs making up three quarters of annual spending.

Build the Budget Resolution Around the Reconciliation Bill

Lawmakers should craft the budget resolution around a reconciliation bill, instead of the other way around. They should treat the budget resolution as a procedural vote that advances the pre-negotiated reconciliation bill. The instructions should reflect the preferred outcome and not precede or preclude policy decisions that have yet to be made.

They could consider the budget resolution the equivalent to a rule for considering legislation in the House or a motion to proceed in the Senate. In the House, it would be unthinkable to adopt a rule for consideration of legislation that Members had not yet seen and reviewed, much less legislation that had not even been drafted. Why should a budget resolution paving the way for reconciliation be any different? If the budget resolution is truly only used as a procedural tool to unlock reconciliation, it should be treated as such.

Conclusion

It would be good if the process imagined under the Congressional Budget Act of 1974 worked. But it does not work, and it never has. The idea that “regular order” was ever the normal budget process is a myth: only four times in the 50 years of the modern budget process have all of the regular annual appropriations bills been signed into law on time. That is, by definition, irregular.

Overly prescriptive procedures, such as those in the Budget Act, are unlikely to be sustainable. Budget rules and processes are needed tools for policymakers. At the same time, the budget process is no substitute for the political process. [4]

Reconciliation has become a way for important policies to be fast-tracked through the legislative process. Lawmakers who want to utilize this process in the most effective way should prepare themselves for success. As recent experience has taught, one lesson for lawmakers is that they should build the budget resolution around a pre-negotiated reconciliation bill rather than following the steps imagined in the “official” process. This would ensure that the reconciliation opportunity is not wasted.

Appendix: Budget Resolutions and Reconciliation

[1] Note that enacting the 12 appropriations bills each year is the expectation, while reconciliation is an optional process. In the context of the experience of those who created the Congressional Budget Act of 1974, it was logical that the new process they were establishing would be centered around completion of the regular discretionary appropriations bills. 1974 was the last year discretionary outlays comprised a majority of the annual budget. Today, discretionary outlays only amount to 27 percent of annual spending.

[2] The Rules of the House of Representatives do not include a prohibition on considering reconciliation bills that violate the committee instructions, unlike the Senate. The Senate enforces the instructions for its committees through the Byrd Rule. The House Agriculture Committee fell more than $100 billion short of its $230 billion savings target, the House Armed Services Committee exceeded its $100 billion spending cap by about $50 billion, the Education and Workforce Committee fell about $50 billion short of its $330 billion savings target, the Oversight and Government Reform Committee fell about $48 billion short of its $50 billion savings target, and the Committee on Ways and Means exceeded its revenue reduction cap by about $600 billion under the Fiscal Framework and exceeded the debt limit increase by $1 trillion.

[3] This “302(a) allocation” is named after the relevant section of the Congressional Budget Act that created the requirement. All authorizing and appropriations committees received a 302(a) allocation, but only the House and Senate Appropriations Committees’ allocation is well-known.

[4] I say this as someone who personally cares about the budget blueprint function that the budget resolution is supposed to serve. In the last decade, I have helped lead seven different comprehensive budget proposals at the House Budget Committee, the Republican Study Committee, and the Heritage Foundation.