Legal authority from Congress that allows a federal agency to spend money from the U.S. Treasury for a specific purpose and time period.
Think of it this way: an appropriation is not actual cash sitting in an account with the agency's name on it. Instead, it's permission to make financial commitments (obligations) and eventually pay bills, up to a certain dollar limit and within a certain timeframe.
Official Definition
According to the GAO's Federal Budget Glossary, an Appropriation is defined as:
“Budget authority to incur obligations and to make payments from
the Treasury for specified purposes. An appropriation act is the most common means
of providing appropriations; however, authorizing and other legislation itself may
provide appropriations.”
Account Title: Debt Liquidation Appropriations Account Number: 411100 Normal Balance: Debit Definition: This account is used to record the amount appropriated to liquidate debt as
specified in the appropriation language.
Account Title: Liquidation of Deficiency -appropriations Account Number: 411200 Normal Balance: Debit Definition: This account is used to record the amount appropriated to liquidate a prior-
year deficiency.
Account Title: Appropriated Receipts Derived From Unavailable Trust or Special Fund Receipts Account Number: 411300 Normal Balance: Debit Definition: This account is used to record the amount of receipts appropriated from an "unavailable" trust or special fund receipt account to a corresponding trust or
special fund expenditure account. (Amounts deposited into trust or special
fund receipt accounts designated by the Department of the Treasury as
"unavailable" are appropriated via Treasury warrant, upon legislative action,
to the corresponding expenditure account). This budgetary resource account does not correspond with proprietary USSGL account 310100, "Unexpended
Appropriations - Appropriations Received."
Account Title: Appropriated Receipts Derived From Available Trust or Special Fund Receipts Account Number: 411400 Normal Balance: Debit Definition: This account is used to record the amount of receipts appropriated from an "available" trust or special fund receipt account to a corresponding trust or
special fund expenditure account. (Amounts designated by the Department
of the Treasury as "available" are immediately transferred without further action). This budgetary resource account does not correspond with
proprietary USSGL account 310100, "Unexpended Appropriations -
Appropriations Received."
Account Title: Loan Subsidy Appropriation Account Number: 411500 Normal Balance: Debit Definition: This account is used to record the amount of budget authority appropriated by law for loan subsidies in direct loan and loan guarantee programs.
Account Title: Debt Forgiveness Appropriation Account Number: 411600 Normal Balance: Debit Definition: This account is used to record the amount of budget authority that Congress provides equivalent to an inferred appropriation to retire debt as specified in a public law. This excludes debt subject to credit reform
Account Title: Loan Administrative Expense Appropriation Account Number: 411700 Normal Balance: Debit Definition: This account is used to record the amount of new budget authority appropriated by law for administrative expenses in direct loan and loan guarantee programs. Account Title: Reestimated Loan Subsidy Appropriation Account Number: 411800 Normal Balance: Debit Definition: This account is used to record the amount of budget authority appropriated for direct loan and loan guarantee subsidies based upon reestimates as specified in the Federal Credit Reform Act of 1990.
Account Title: Other Appropriations Realized Account Number: 411900 Normal Balance: Debit Definition: This account is used to record the amount of budget authority appropriated as specified in the appropriation language for all other appropriations not otherwise classified
What This Means in Practice
Appropriations usually come up when you receive your budget for the fiscal year or when Congress makes subsequent changes during the year. As part of budget authority, appropriations will be presented the same way on the SF-132 (Apportionment Schedule), SF-133 (Report on Budget Execution and Budgetary Resources), and the SBR (Statement of Budgetary Resources). While OMB clearly states the appropriation balance on the SF-132, you should review the actual appropriation law to validate you agree with OMB's interpretation.
Simple Example
Here's a typical scenario:
Congress passes an appropriations act that gives your agency $50 million in a new annual fund for salaries and expenses for FY 2025. This appropriation gives your agency the authority to obligate up to $50 million during that fiscal year for personnel costs and operating expenses. Your agency can now hire staff, pay salaries, purchase supplies, and enter into contracts, as long as the total obligations don't exceed $50 million and the spending aligns with the purposes Congress specified in the appropriation law. This amount would be apportioned by OMB through a SF 132.
Here is a real example of an appropriation of $63 Million to fund the salaries for the management of the Department of Commerce. PUBLIC LAW 116–6 133 STAT. 99
Common Mistakes or Confusion
Appropriation vs. Appropriation Law
Appropriation Law is the actual statute (Act of Congress) that provides funding. Examples include annual appropriations bills like the Defense Appropriations Act or supplemental funding acts.
Appropriation (Budget Authority) is the legal permission granted by that law, allowing agencies to incur obligations and make payments from the Treasury for specific purposes.
The relationship: The law is the vehicle; the appropriation is the spending power conveyed within that law. Think of the law as the envelope and the appropriation as the check inside.
Where You’ll See This Term Used
You'll most commonly see appropriations in budget authority documents such as the SF-132 (Apportionment Schedule), SF-133 (Report on Budget Execution and Budgetary Resources), and the SBR (Statement of Budgetary Resources). You may also see the term discussed in budget execution guidance (for example, OMB A-11) in the context of funds control.
