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10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 October 16, 2020 WASHINGTON — U.S. Treasury Secretary Steven T. Mnuchin and White House O ice of Management and Budget (OMB) Director Russell Vought today released the final budget results for fiscal year (FY) 2020. President Donald Trump took bold and swi action to protect public health from the e ects of the unprecedented pandemic, signing into law four major pieces of legislation that address the health and economic e ects of COVID-19. Through these laws, the Trump Administration has provided assistance to American workers and families, small businesses, and state, local, and tribal governments, and preserved jobs for American industry. Primarily due to these e orts, the deficit in FY 2020 was $3.1 trillion—$2.0 trillion more than forecast in the FY 2021 President’s Budget (Budget).[1] Under President Trump’s leadership, the economy has begun an incredible comeback. The unemployment rate has declined each month since its peak in April, falling to 7.9 percent in September. In the last five months, 52 percent of the jobs lost during the pandemic have been recovered and the United States has gained more than 11.4 million jobs. Employment will continue to improve as states reopen businesses and li social distancing orders. “Thanks to President Trump’s pro-growth policies and the bipartisan CARES Act, we are experiencing a strong economic recovery,” said Secretary of the Treasury Steven T. Mnuchin. “The Administration remains fully committed to supporting American workers, families, and businesses and to ensuring that our robust economic rebound continues.” “President Trump built the best, most resilient, economy in the world with historic tax cuts, deregulation, and fair trade deals,” said OMB Director Russ Vought. “As the country continues to open up and this Administration pursues its pro-growth agenda, our economy will continue its robust recovery, sending Americans back to work and improving our fiscal picture.” SUMMARY OF F ISCAL YEAR 2020 B UDGET RESULTS https://home.treasury.gov/news/press-releases/sm1155 1/9 10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury Year-end data from the September 2020 Monthly Treasury Statement of Receipts and Outlays of the United States Government show that the deficit for FY 2020 was $3.1 trillion; $2.1 trillion higher than the prior year’s deficit. The FY 2020 deficit was $2.0 trillion higher than the estimate of $1.1 trillion in the FY 2021 Budget published in February. Table 1. Total Receipts, Outlays, and Deficit (in trillions of dollars) FY 2019 Actual Receipts Outlays Deficit 3.462 4.447 -0.984 3.706 4.790 -1.083 3.420 6.552 -3.132 FY 2020 Estimate: 2021 Budget FY 2020 Actual Note: Detail may not add to totals due to rounding. The increase in the deficit from FY 2019 reflects the e ect of COVID-19 on the economy and legislation that created or enhanced programs to protect public health and support hard-hit industries, small businesses, and American individuals and families. Those laws are: Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020 (Public Law 116-123); Families First Coronavirus Response Act (FFCRA, Public Law 116-127); Coronavirus Aid, Relief, and Economic Security Act (CARES Act, Public Law 116-136); and the Paycheck Protection Program and Health Care Enhancement Act (PPPHCE Act, Public Law 116-139). Governmental receipts totaled $3.420 trillion in FY 2020, lower than Budget expectations due to lower-than-estimated collections of taxes and receipts, partially o set by higher-thanestimated collections for deposits of earnings by the Federal Reserve. Total receipts were $42 billion lower than in FY 2019, a decrease of 1 percent. The nominal decrease in receipts relative to FY 2019 can be attributed primarily to lower net individual and corporation income tax receipts and excise taxes, partially o set by higher social insurance and retirement receipts and deposits of earnings by the Federal Reserve. https://home.treasury.gov/news/press-releases/sm1155 2/9 10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury Outlays grew substantially in FY 2020 and far exceeded Budget expectations due to programs created or expanded in the four laws listed above and increased use of Federal assistance programs such as unemployment insurance. Outlays were $6.552 trillion, $2.105 trillion above those in FY 2019; a 47 percent increase. Contributing to the dollar increase over FY 2019 were higher outlays for the Department of Health and Human Services, the Department of Labor, the Department of the Treasury, and the Small Business Administration. Total Federal borrowing from the public increased by $4.216 trillion during FY 2020 to $21.019 trillion. The increase in borrowing included $3.132 trillion in borrowing to finance the deficit as well as $1.084 trillion in net borrowing related to other transactions such as changes in cash balances and net disbursements for Federal credit programs. Below are explanations of the di erences between estimates in the Budget and the year-end actual amounts, for receipts and outlays. F ISCAL YEAR 2020 RECEIPTS Total receipts for FY 2020 were $3.420 trillion, $286 billion lower than the Budget estimate of $3.706 trillion. This net decrease in receipts was the net e ect of lower-than-estimated collections of individual income taxes, corporation income taxes, and customs duties, excise taxes, estate and gi taxes, social insurance and retirement receipts, and other miscellaneous receipts, partially o set by higher-than-estimated collections for deposits of earnings by the Federal Reserve. Table 2 displays actual receipts and estimates from the Budget by source. Individual income taxes were $1.609 trillion, $203 billion lower than the Budget estimate. This di erence was the net e ect of lower withheld payments of individual income tax liability of $158.1 billion, lower nonwithheld payments of $68.8 billion, and lower-than-estimated refunds of $23.6 billion. Corporation income taxes were $211.8 billion, $51.8 billion below the Budget estimate. This di erence was the e ect of lower-than-expected payments of corporation income tax liability of $40.7 billion and higher-than-estimated refunds of $11.1 billion. Social insurance and retirement receipts were $1.310 trillion, $2.1 billion lower than the Budget estimate. Excise taxes were $86.8 billion, $7.8 billion below the Budget estimate. https://home.treasury.gov/news/press-releases/sm1155 3/9 10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury Estate and gi taxes were $17.6 billion, $2.8 billion below the Budget estimate. Customs duties were $68.6 billion, $23.8 billion below the Budget estimate. Miscellaneous receipts were $116.5 billion, $5.2 billion above the Budget estimate. This was the net e ect of lower-than-expected collections of various fees, penalties, forfeitures, and fines of $4.0 billion; o set by higher-than-expected deposits of earnings by the Federal Reserve System of $9.2 billion, largely due to lower short-term interest rates and higher earnings as they have increased their asset holdings in response to COVID-19. F ISCAL YEAR 2020 OUTLAY S Total outlays were $6.552 trillion for FY 2020, $1.762 trillion above the Budget estimate. Figure 1 presents outlays by month and shows the increase in outlays in the second half of the year following the enactment of legislation to address the COVID-19 pandemic. Those increases led to outlays that exceeded Budget expectations for several agencies and major programs. Table 3 displays actual outlays by agency and major program as well as estimates from the Budget. The largest changes in outlays from the Budget were in the following areas: Department of Agriculture — Outlays for the Department of Agriculture were $184.2 billion in FY 2020, $29.6 billion more than the Budget estimate. The majority of this di erence is attributable to outlays in the Supplemental Nutrition Assistance Program (SNAP) being $20.1 billion higher than estimated in the Budget due to increased participation, the issuance of supplemental emergency allotments due to the COVID-19 pandemic, and the issuance of Pandemic-EBT benefits, newly authorized in the FFCRA. In April 2020, SNAP served 43 million people, 5.6 million more than in April 2019, and 5.9 million more than projected. The other major contributing factor was a net $9 billion increase in outlays for the coronavirus food assistance payments (CFAP). The O ice of the Secretary received a CARES Act appropriation of $9.5 billion plus administrative transfers of $20.5 billion from the Commodity Credit Corporation (CCC) for this program, and the net $9 billion in outlays from this supplemental funding were not included in the Budget estimate. Finally, in the Rural Electrification and Telecommunications Liquidating Account, outlays were $3.5 billion higher than the Budget estimate due to higher-than-anticipated prepayments from borrowers electing to use their cushion of credit accounts to repay rural utilities service debt. https://home.treasury.gov/news/press-releases/sm1155 4/9 10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury Department of Education — Outlays for the Department of Education were $204.4 billion, $45.1 billion higher than the Budget estimate. The di erence is primarily driven by modifications to the Federal Direct Student Loan program as provided for in the CARES Act, which, among other things, automatically suspended principal and interest payments and set interest rates to zero percent on federally held student loans through September 30, 2020. The relief for borrowers resulted in an upward modification cost of $24.6 billion in the Direct Loan program, with an additional $0.5 billion for cancelled loans for students that did not complete the semester due to a qualifying emergency. Additional modifications were recorded to reflect the August 8th Presidential Memorandum that continued the CARES Act suspension of payments and the waiver of all interest on federally held student loans through December 31, 2020—this relief for borrowers resulted in an upward modification cost of $13.4 billion in the Direct Loan program. An upward modification of $1.0 billion was also recorded for the final regulation on Total and Permanent Disability Discharge of Loans for Veterans. In addition to these modifications, the CARES Act also appropriated $31 billion dollars, split into three emergency relief funds for K-12 schools and institutions of higher education. Of the amount appropriated, approximately $11 billion outlayed in FY 2020. Department of Health and Human Services — Outlays for the Department of Health and Human Services (HHS) in 2020 were $1.504 trillion, $182 billion higher than the 2021 President’s Budget estimate. Gross outlays for Medicare’s Hospital Insurance (HI) and Supplementary Medical Insurance (SMI) trust funds were $410.4 billion and $422.2 billion, respectively $60.2 billion and $19.8 billion higher than the Budget estimates. A large part of the di erences is attributed to the Centers for Medicare and Medicaid Service’s Accelerated and Advance Payments (AAP), which were expanded during the COVID-19 pandemic in order to increase cash flow to a ected Medicare Part A and B providers and suppliers. Under the AAP, these higher outlays will be largely o set by lower provider and supplier payments in the future as advances are repaid. Outlays for Medicaid were $11.2 billion above the President’s Budget estimate, primarily driven by higher-than-anticipated enrollment and benefits spending due to enacted legislation and the COVID-19 public health emergency response, which included a temporary increase to the Medicaid Federal match rate. Outlays for the Public Health and Social Services Emergency Fund (PHSSEF) were higher than expected (approximately $107 billion above the President’s Budget), primarily due to enacted legislation in response to the COVID-19 public health emergency. The majority of https://home.treasury.gov/news/press-releases/sm1155 5/9 10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury these outlays were for the Provider Relief Fund program, which received a total of $175 billion in funding to distribute to hospitals and other healthcare providers. The actual outlays for other health programs were $11 billion lower than projected in the Budget. This is primarily due to the absence of an appropriation for Cost-Sharing Reductions ($8 billion) and delayed collections and payments for Risk Adjustment ($2 billion). Department of Homeland Security — Outlays for the Department of Homeland Security were $92.0 billion, $29.8 billion higher than the Budget estimate. Approximately $31.2 billion of the di erence is driven by the Federal Emergency Management Agency (FEMA). FEMA’s Disaster Relief Fund outlays account for the majority of this di erence ($32.4 billion) due to COVID-19 disaster activity, in particular the inclusion of Lost Wage Assistance as an eligible expense. In addition, the National Flood Insurance Program projected paying $1 billion more in flood insurance claims than was actually required because their modeling reflects the expected long-term annual claims average. The remainder is due to less-than-projected outlays in other accounts. Department of Justice — Outlays for the Department of Justice were $39.6 billion, $5.7 billion lower than the Budget estimate. The di erence is predominately due to large changes in the: (1) Crime Victims Fund (CVF); (2) State and Local Law Enforcement Assistance (SLLEA) account; (3) the 9/11 Victims Compensation Fund (VCF); and (4) the Asset Forfeiture Program (AFP). Outlays for the CVF were $1.8 billion lower than estimated due to a slowerthan-anticipated draw down of funds made available in prior fiscal years. Outlays by the SLLEA were $0.8 billion lower than anticipated in the President’s Budget partially due to ongoing litigation. For the VCF, outlays were $0.7 billion below anticipated levels due to lower-than-projected victim payments out of the account. Finally, AFP outlays were $1 billion lower than estimates due to an unanticipated lag in victim payments. Department of Labor — Outlays for the Department of Labor were $477.5 billion, $441.1 billion higher than the Budget estimate. This increase is attributable primarily to higher outlays for Unemployment Insurance (UI) resulting from the COVID-19 public health emergency’s e ects on the economy. Levels of unemployment were significantly higher than the levels assumed in the Budget. Additionally, enacted legislation increased benefits and expanded coverage to the self-employed, independent contractors, and those with limited work history, among others. Federal Pandemic Unemployment Compensation increased weekly benefits by $600 through July 31, 2020. Pandemic Unemployment Assistance provides benefits for the self-employed and “gig workers,” among other groups, available https://home.treasury.gov/news/press-releases/sm1155 6/9 10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury through December 31, 2020. Pandemic Emergency Unemployment Compensation provides an additional 13 weeks of benefits on top of regular benefits, which last for 26 weeks in most States, until the end of December 2020. Department of Transportation — Outlays for the Department of Transportation (DOT) were $100.3 billion, $15.7 billion higher than the Budget estimate. The di erence is largely due to the $16.1 billion of outlays from the $36.1 billion of supplemental funding provided to DOT by the CARES Act that were not part of the original estimate. The remaining di erence, roughly $0.5 billion lower than the Budget estimate, is an accumulation of lower-thanexpected spending across a number of large program accounts due to normal yearly fluctuations. Department of the Treasury — Outlays for the Department of the Treasury were $1.152 trillion, $451 billion higher than the Budget estimate. CARES Act programs administered by Treasury accounted for $472.3 billion in higher-thanprojected net outlays, driven by amounts for Economic Impact Payments, the Coronavirus Relief Fund, outlays from the Exchange Stabilization Fund’s Economic Stabilization Fund Program and the Air Carrier Worker Support (also known as the Payroll Support Program). Interest on the public debt, which is paid to the public and to trust funds and other Government accounts, was $53.8 billion lower than the Budget estimate. The di erence was due largely to lower-than-projected interest paid to the public on inflation-protected securities and other marketable Treasury securities, as well as lower-than-projected interest paid to the Military Retirement Fund and other Government accounts. Net outlays for intragovernmental interest transactions with non-budgetary credit financing accounts were $9.3 billion higher than projected, including $11.4 billion in higher-thanprojected interest paid to credit financing accounts, partly o set by $2.0 billion higher-thananticipated receipts of interest from credit financing accounts. (Interest received from credit financing accounts is reported in Treasury’s aggregate o setting receipts.) Non-CARES Act Exchange Stabilization Fund outlays were $12.0 billion higher than projected in the Budget. Refundable corporate tax credits outlays were also $9.4 billion higher than projected, while outlays for the Refundable Premium Tax Credit were $2.9 billion higher than anticipated. Department of Veterans A airs — Outlays for the Department of Veterans A airs (VA) were $218.4 billion, $4.1 billion higher than the Budget estimate. https://home.treasury.gov/news/press-releases/sm1155 7/9 10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury The di erence was driven by higher medical care spending for costs related to the COVID-19 pandemic, which was partially o set by lower outlays in the benefits and other programs. Outlays for the Veterans Health Administration were $9.2 billion above the Budget estimate primarily due to spending related to the pandemic, for care provided both in VA facilities and in the community. Outlays for Departmental Administration programs were $2.4 billion lower than the Budget estimate, roughly half of which occurred in the construction, capital grants, and electronic health record programs primarily due to pandemic-related delays. Outlays for benefits programs were $2.9 billion lower than the Budget estimate, primarily due to fewer beneficiaries participating in Chapter 33 education benefits programs and fewer disability compensation eligibility ratings decisions due to COVID-19 disruptions. International Assistance Programs — Outlays for International Assistance Programs were $21.7 billion, $4.0 billion lower than the Budget estimate. This di erence is largely due to Foreign Military Financing grant outlays, which were $2.4 billion lower than projected, in part to account for the time required to meet congressional pre-obligation requirements. In addition, Foreign Military Sales net outlays were lower than expected due to higher-thananticipated receipts received from foreign governments for weapons purchases. Small Business Administration — Outlays for the Small Business Administration (SBA) were $577.4 billion, $577.6 billion higher than the Budget estimate. The Budget assumed -$0.2 billion in outlays, largely due to reductions in the expected costs of outstanding loans assumed at the time the Budget was published. The di erence in outlays is associated with the COVID-19 economic relief programs to support small businesses created by the CARES Act and PPPHCE Act, including the Paycheck Protection Program to provide forgivable lowcost loans to businesses that keep their workers on payroll; the Economic Injury Disaster Loans program to provide low interest loans to small businesses and private non-profit organizations; Economic Injury Disaster Loan Advances; and Debt Relief payments to provide six months of principal and interest payments for eligible SBA loans. Undistributed O setting Receipts — Undistributed O setting Receipts were -$241.6 billion, $13.2 billion higher than the Budget estimate (lower net collections). Interest received by trust funds was $10.4 billion higher than the Budget estimate. The di erence was due largely to Military Retirement Fund interest earnings, which were $9.5 billion lower than the Budget estimate. This intragovernmental interest is paid out of the Department of the Treasury account for interest on the public debt and has no net impact on total Federal Government outlays. https://home.treasury.gov/news/press-releases/sm1155 8/9 10/17/2020 Mnuchin And Vought Release Joint Statement On Budget Results For Fiscal Year 2020 | U.S. Department of the Treasury [1] With wide data fluctuations caused by the unprecedented pandemic, the FY 2021 MidSession Review could not include a revised estimate of FY 2020 Gross Domestic Product (GDP), which is typically used as the base for GDP comparisons for this document. Final Monthly Treasury Statement Receipts and Outlays of the United States Government for Fiscal Year 2020 Through September 30, 2020, and Other Periods Fiscal Year 2020 Budget Summary through September 2020 Background Information for the September 2020 Monthly Treasury Statement Monthly Outlays of the U.S. Government, by Source, Fiscal Year 2020 Receipts by Source Outlays by Agency https://home.treasury.gov/news/press-releases/sm1155 9/9
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