[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 998 Introduced in House (IH)]
103d CONGRESS
1st Session
H. R. 998
To achieve a balanced Federal budget by fiscal year 1998 and each year
thereafter, achieve significant deficit reduction in fiscal year 1994
and each year through 1998, establish a Board of Estimates, require the
President's budget and the congressional budget process to meet
specified deficit reduction and balance requirements, enforce those
requirements through a multiyear congressional budget process and, if
necessary, sequestration, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 18, 1993
Mr. Penny (for himself, Mr. Visclosky, Mr. Wilson, Mr. Spratt, Mr.
Lancaster, Mr. Oberstar, Mr. Moran, Mr. Mazzoli, Mr. Hughes, Mr.
Stenholm, and Mrs. Unsoeld) introduced the following bill; which was
referred jointly to the Committees on Government Operations, Rules, and
Ways and Means
_______________________________________________________________________
A BILL
To achieve a balanced Federal budget by fiscal year 1998 and each year
thereafter, achieve significant deficit reduction in fiscal year 1994
and each year through 1998, establish a Board of Estimates, require the
President's budget and the congressional budget process to meet
specified deficit reduction and balance requirements, enforce those
requirements through a multiyear congressional budget process and, if
necessary, sequestration, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
TITLE I--BALANCING THE BUDGET
PART A--PURPOSE
SECTION 1. SHORT TITLES; REPEALERS.
(a) Short Title of This Act.--This Act may be cited as the
``Balanced Budget Enforcement Act of 1993''.
(b) Short Title of Part B.--Part B of this Act may be cited as the
``Deficit Elimination Act of 1993''.
(c) Repealer.--Parts C, D, and E of the Balanced Budget and
Emergency Deficit Control Act of 1985 are repealed.
SEC. 2. PURPOSE.
The purpose of this Act is--
(1) to mandate and achieve enough deficit reduction in each
year through fiscal year 1998 to eliminate the deficit by that
year;
(2) from fiscal year 1999 onward, to mandate whatever
deficit reduction may be needed to eliminate any deficit that
may be projected;
(3) to achieve a portion of the mandated deficit reduction
by limiting the total level of discretionary funding and the
remainder by requiring a fixed amount of deficit reduction from
some combination of entitlement and receipts changes;
(4) to establish a Board of Estimates to arbitrate between
OMB and CBO;
(5) to require the figures in the President's budget and
the budget resolution to meet the provisions of this Act;
(6) to enforce each year's discretionary funding limits and
entitlement/receipts requirements through the Congressional
Budget Act, including multiyear allocations and reconciliation
directives;
(7) to supplement Congressional Budget Act enforcement with
across-the-board cuts or sequestration whenever the
discretionary funding limits or entitlement/receipts
requirements of this Act are not met;
(8) to provide a targeted sequestration that enforces the
committee targets for entitlement reductions and receipts
increases set forth in budget resolutions;
(9) to create a backup comprehensive sequestration
applicable in any fiscal year in which the committee targets in
a budget resolution are not enforceable; and
(10) to provide that reconciliation savings and
sequestration savings shall be permanent.
SEC. 3. TABLE OF CONTENTS.
TITLE I--BALANCING THE BUDGET
Part A--Purpose
Sec. 1. Short titles; repealers.
Sec. 2. Purpose.
Sec. 3. Table of contents.
Sec. 4. Effective dates.
Part B--THE DEFICIT ELIMINATION ACT OF 1993
Sec. 100. Definitions and treatments.
Sec. 101. Direct spending and receipts: deficit reduction requirements.
Sec. 102. Discretionary funding limits.
Sec. 103. Balancing the budget in 1998.
Sec. 104. Preventing deficits after 1998.
Sec. 105. Spin-off law.
Sec. 106. Direct spending and receipts scorecard.
Sec. 107. Discretionary scorecard.
Sec. 108. Targeted sequestration.
Sec. 109. Comprehensive sequestration.
Sec. 110. Across-the-board reduction of discretionary programs.
Sec. 111. Exempt programs and activities.
Sec. 112. General and special sequestration rules.
Sec. 113. Sequestration through tax changes.
Sec. 114. Estimating assumptions, reports, and orders.
Sec. 115. The current policy baseline.
Sec. 116. Baseline assuming deficit reduction.
Sec. 117. Stabilization Reserve Fund.
Sec. 118. Modifications if war or low growth.
Sec. 119. Board of estimates.
Sec. 120. Judicial review.
TITLE II--TECHNICAL AND CONFORMING AMENDMENTS
Sec. 201. Amendments to the Congressional Budget and Impoundment
Control Act of 1974.
Sec. 202. Amendments to the Federal Credit Reform Act of 1990.
Sec. 203. Amendments to the Rules of the House of Representatives.
Sec. 204. Amendments to the Standing Rules of the Senate.
Sec. 205. President's budget and supplemental budget estimates.
Sec. 206. Amendments to other laws.
SEC. 4. EFFECTIVE DATES.
Except as otherwise specified, this Act and the amendments made by it
shall take effect on its date of enactment and shall apply to fiscal
year 1994 and subsequent fiscal years.
PART B--THE DEFICIT ELIMINATION ACT OF 1993
SEC. 100. DEFINITIONS AND TREATMENTS.
As used in this part:
(1) The terms ``budget authority'', ``new budget
authority'', ``entitlement authority'', ``outlays'', and
``deficit'' have the meanings given to such terms in section 3
of the Congressional Budget and Impoundment Control Act of
1974, and the term ``receipts'' shall be treated as a synonym
for the term ``revenues'' as it is used in that Act.
(2) The term ``account'' means an item for which
appropriations are made in any appropriation Act and, for items
not provided for in appropriation Acts, such term means an item
for which there is a designated budget account identification
code number in the President's budget.
(3) The term ``aggregate first-year spendout rate'' means
the percent of new budget authority that is expended in the
fiscal year for which the budget authority is provided.
(4) The term ``Board of Estimates'' or ``Board'' refers to
the entity established by section 119.
(5) The term ``budget year'' means, with respect to a
session of Congress, the fiscal year of the Government that
starts on October 1 of the calendar year in which that session
begins.
(6) The term ``budget-year session'' means any session of
Congress that starts in the calendar year in which that budget
year starts.
(7) The term ``category'' refers to all direct spending
within the jurisdiction of a standing committee of the House of
Representatives as so designated in the joint statement of
managers accompanying the conference report on this Act, as
modified from time to time by the Board of Estimates upon the
written recommendation of the Speaker of the House of
Representatives.
(8) The term ``CBO'' means the Director of the
Congressional Budget Office.
(9) The term ``current policy baseline'' means the
projection (described in section 115) of current-year levels of
new budget authority, outlays, receipts, and the surplus or
deficit into the budget year and the outyears.
(10) The term ``current year'' means the fiscal year that
immediately precedes a budget year.
(11) The term ``deposit insurance'' refers to the expenses
of the Federal Deposit Insurance Corporation and the funds it
incorporates, the Resolution Trust Corporation, the National
Credit Union Administration and the funds it incorporates, the
Office of Thrift Supervision; the Comptroller of the Currency
Assessment Funds, and the RTC Office of the Inspector General.
(12) The term ``direct spending'' means--
(A) budget authority provided by law other than
appropriation Acts;
(B) entitlement authority; and
(C) the food stamp program.
If a law other than an appropriation Act alters the level of
discretionary appropriations, that effect shall be treated as
direct spending. Budget authority provided from a
transportation trust fund in any Act shall not be considered to
be provided by a law other than an appropriation Act.
(13) The term ``discretionary appropriations'' means new
budget authority (except to fund entitlement authority)
provided by appropriation Acts and the term ``discretionary
programs'' refers to programs so financed. New budget authority
provided from transportation trust funds by any Act shall be
considered to be provided by an appropriation Act. If an
appropriation Act alters the level of direct spending, that
effect shall be treated as a discretionary appropriation.
(14) The term ``discretionary funding limit'' means the
total amount of discretionary new budget authority that, under
section 102 or 104, may be enacted in any fiscal year.
(15) The term ``discretionary regulations'' refers to
regulations issued by the executive branch for which Congress
delegates the authority to vary amounts, levels, rates,
effective dates, or other factors.
(16) The term ``major estimating assumptions'' refers to
the list of items set forth under that heading in the joint
explanatory statement of managers accompanying the conference
report on this Act as modified by the Board under section 119.
(17) The term ``OMB'' means the Director of the Office of
Management and Budget.
(18) The term ``outyear'' means any of the 4 fiscal years
that follow a budget year.
(19) The term ``real economic growth'' means the growth in
the gross domestic product, adjusted for inflation, consistent
with Department of Commerce definitions.
(20) The terms ``sequester'' and ``sequestration'' refer to
or mean the cancellation under section 110 of budget authority
provided by discretionary appropriations, the cancellation
under section 108 or 109 of direct spending authority, or the
change in taxes under section 113.
(21) The term ``sequestrable budget authority'' means, for
non-exempt accounts or activities within major functional
category 050 (national defense), all budget authority, and for
all other non-exempt accounts or activities, new budget
authority.
(22) The term ``Stabilization Reserve Fund'' refers to the
deposit fund established by section 117.
(23)(A) The following shall be treated as positive numbers:
(i) A deficit.
(ii) A deficit increase or surplus decrease.
(iii) A deficit or surplus change and a deficit or
surplus change target when the deficit is increased by,
or the surplus is reduced by, the change.
(iv) A deficit reduction shortfall.
(v) An amount to be sequestered.
(B) The following shall be treated as negative numbers:
(i) A surplus.
(ii) A deficit reduction or surplus increase.
(iii) A deficit or surplus change and a deficit or
surplus change target when the deficit is reduced by,
or the surplus is increased by, the change.
(24) Proceeds from the sale of a Government asset (except a
loan asset) shall not be scored as deficit reduction for any
fiscal year with respect to the budget-year session during
which the law providing for the asset sale was enacted.
SEC. 101. DIRECT SPENDING AND RECEIPTS: DEFICIT REDUCTION REQUIREMENTS.
The deficit reduction targets for direct spending and receipts
legislation are as follows:
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Fiscal Year Deficit Reduction (in billions of dollars)
----------------------------------------------------------------------------------------------------------------
1994.................................... -32.3
1995.................................... -61.7
1996.................................... -92.7
1997.................................... -125.6
1998.................................... -160.3
----------------------------------------------------------------------------------------------------------------
The deficit reduction target for fiscal year 1998 shall be adjusted, if
necessary, as provided by section 103.
SEC. 102. DISCRETIONARY FUNDING LIMITS.
(a) Initial Amounts.--Subject to modifications under subsection
(b), discretionary funding limits, measured in terms of new budget
authority, are as follows:
----------------------------------------------------------------------------------------------------------------
Fiscal Year Limits (in billions of dollars)
----------------------------------------------------------------------------------------------------------------
1994..................................................... 515.7
1995..................................................... 515.7
1996..................................................... 515.7
1997..................................................... 515.7
1998..................................................... 515.7
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(b) Adjustments to Funding Limits.--Whenever appropriate,
adjustments to the discretionary funding limits (and to those limits as
cumulatively adjusted) for one or more fiscal years shall be made to
reflect the following:
(1) Changes in concepts.--For any fiscal year, the
adjustments produced by any change in budget accounting
concepts (including scorekeeping conventions, budget
classifications, and definitions) shall equal the current-year
levels of new budget authority using up-to-date concepts minus
those levels using the concepts in effect before the change.
Such changes in concepts may only be made in consultation with
the Committees on Appropriations and the Budget of the House of
Representatives and Senate, CBO, and OMB. A change in budget
classifications includes any change from the assumption that
all amounts provided in appropriation Acts are classified as
discretionary except those included under the heading
``Mandatory Appropriations'' in the joint explanatory statement
of managers accompanying the conference report on this Act.
(2) Changes in inflation.--(A) For the budget year and each
outyear through 1998, the adjustments produced by changes in
inflation shall equal the discretionary funding limit for each
such year multiplied by the inflation adjustment factor (for
the fiscal year immediately preceding the current year)
computed under subparagraph (B).
(B) The inflation adjustment factor shall be calculated by
subtracting 1 from the ratio of (i) the level of year-over-year
inflation measured for the fiscal year immediately preceding
the current year, and (ii) the applicable estimated level for
that year set forth below:
For 1992, 1.031
For 1993, 1.036
For 1994, 1.036
For 1995, 1.036
For 1996, 1.036.
Inflation shall be measured by the average of the estimated
consumer price index for all urban consumers for a fiscal year
divided by the average index for the prior fiscal year.
(3) Expiring housing contracts.--For each budget year
through 1998, the adjustment shall be the amount of new budget
authority needed to renew expiring multiyear subsidized housing
contracts or provide contracts to replace units lost due to
prepayments, with the per-contract renewal/replacement cost
equal to the average current-year cost of renewal or
replacement contracts.
(4) Emergencies.--If for any fiscal year appropriations for
discretionary accounts are enacted that are designated as
emergency requirements by statute, the adjustment shall be the
amount of those appropriations that the President also
designates, in writing, as emergency requirements within 5 days
of the enactment of those appropriations. If any amount
previously designated as an emergency requirement is rescinded,
the adjustment shall be the amount of that rescission.
(5) New limits for 1998 and thereafter.--The adjustment for
fiscal year 1998 shall be the adjustment (if any) under section
103, and the limit for any succeeding fiscal year shall be the
limit established under section 104.
(6) Transportation trust funds.--For any fiscal year, the
adjustment produced by the enactment of any law that raises
excise taxes dedicated to a transportation trust fund shall be
the amount of the net receipts produced by that tax increase
which that law specifically appropriates for that purpose.
SEC. 103. BALANCING THE BUDGET IN 1998.
If at the start of the 1998 budget-year session the baseline
assuming deficit reduction (set forth in section 116) projects a
deficit (or surplus) for that year, then the direct spending and
receipts deficit reduction requirement for that year under section 101
and the discretionary funding limit for that year under section 102
shall each be changed by amounts that, when debt service effects are
added, will produce a balanced budget. These changes shall be
accomplished by the enactment of a spin-off law described in section
105; or if no spin-off law is enacted, then the direct spending and
receipts deficit reduction requirement for fiscal year 1998 under
section 101 shall be adjusted by two-thirds of the total required
change (excluding debt service effects) and the discretionary funding
limit for fiscal year 1998 under section 102 shall be adjusted to
produce an outlay change equal to one-third of the total required
change (excluding debt service effects). Any adjustment in the
discretionary funding limit (whether in a spin-off law or by
application of the above formula) shall be assumed to produce an outlay
change equal to the change in new budget authority times the aggregate
first-year spendout rate for fiscal year 1998 chosen by the Board of
Estimates.
SEC. 104. PREVENTING DEFICITS AFTER 1998.
Starting with the 1999 budget-year session, the required change in
the level of direct spending and receipts (relative to the current
policy baseline described in section 115) for the budget year and a
discretionary funding limit for that year shall be established. That
change in direct spending and receipts and that discretionary funding
limit (plus the associated effect on debt service) shall produce a
balanced budget. That change and that limit shall be specified in a
spin-off law described in section 105; or if no spin-off law is
enacted, then the change in direct spending and receipts for the budget
year shall be two-thirds of the baseline level of deficit or surplus
(excluding debt service effects) and the discretionary funding limit
for the budget year shall be the baseline level of discretionary new
budget authority adjusted to produce an outlay change equal to one-
third of the baseline level of deficit or surplus (excluding debt
service changes). Any adjustment in the discretionary funding limit
relative to the baseline level of discretionary new budget authority
(whether in a spin-off law or by application of the above formula)
shall be assumed to produce an outlay change equal to the change in new
budget authority times the aggregate first-year spendout rate for
budget year chosen by the Board of Estimates.
SEC. 105. SPIN-OFF LAW.
(a) Through the use of the procedures described in section
301(b)(5) or 310(c) of the Congressional Budget Act of 1974 or by other
means, a law to carry out section 103 or 104 may be enacted. If
required by section 103 or 104, that law shall specify a discretionary
funding limit for the budget year. That law shall specify the budget-
year amount of direct spending change required of or allowed by each
committee of the House of Representatives in laws within that
committee's jurisdiction and the budget-year amount of receipts change
required of or allowed by the Committee on Ways and Means of the House
of Representatives in laws within that committee's jurisdiction. A law
shall not be considered a spin-off law under this section unless--
(1) for each of fiscal years 1994 through 1997, the total
of those amounts for the budget year equals the amount
specified in section 101 less the amount of deficit reduction
achieved for that year measured under section 106; or
(2) for fiscal year 1998 and each year thereafter, the
targets set by the spin-off bill for the budget year will
produce a balanced budget in that year under the estimates and
assumptions chosen by the Board of Estimates for that year.
SEC. 106. DIRECT SPENDING AND RECEIPTS SCORECARD.
(a) Establishment of Scorecard: 1994-1998.--There shall be a
scorecard for each fiscal year through 1998 upon which shall be entered
the estimated increase or decrease in the deficit (relative to the
start-of-session current policy baseline described in section 115) for
the current year, the budget year, and each fiscal year through 1998
due to--
(1) the enactment, after August 15, 1993, of any law,
(2) the imposition of any sequestration under section 108
or 109, or
(3) the change in the baseline from the application of
section 115(b)(3), which relates to certain expiring provisions
of law and to veterans' compensation,
affecting the level of direct spending or the level of receipts.
Entries under the preceding sentence shall not include resulting debt
service changes or any incidental changes in intragovernmental receipts
of Federal trust funds. Amounts shall be entered on the scorecard
within 10 days after the enactment of each such law or the imposition
of any sequestration, and may not thereafter be altered except to
reflect decisions made by the Board of Estimates or to correct clerical
errors or errors in the application of this Act.
(b) Establishment of Scorecard: 1999 and Thereafter.--There shall
be a scorecard, created anew for each budget year starting with 1999,
upon which shall be entered the estimated increase or decrease in the
deficit or surplus (relative to the start-of-session current policy
baseline described in section 115) for the budget year, in any amount
that would have been entered if subsection (a) applied to budget years
after 1998.
(c) Deficit Reduction Requirements.--For each fiscal year, the
scorecard shall also include, as applicable, the amount of the direct
spending and receipts deficit reduction target for that year under
section 101 or the amount (if any) of the direct spending and receipts
deficit change target under section 104. Each such deficit reduction
amount shall be entered as though it were a deficit increase, so that
an equal amount of deficit reduction will have to be achieved to
forestall a sequestration, and each such surplus decrease amount (if
any) shall be entered as though it were a surplus increase, so that the
amount of later surplus decreases will be limited.
(d) Lookback.--If in any budget-year session a law is enacted
affecting the current-year level of direct spending or receipts, the
amount of that current-year effect shall be entered on the scorecard
under the column for the budget year. To mandate year-after savings of
amounts that would have been saved but for the lower sequestration rule
in that section, entries shall also be made as specified in paragraphs
(2) and (3) of section 114(j).
(e) Division Between Direct Spending and Receipts.--The scorecard
shall be divided between changes in the deficit resulting from direct
spending changes and changes in the deficit resulting from changes in
receipts. Solely for purposes of this section, any change in the
deficit resulting from an alteration of the Federal tax treatment of a
direct spending benefit shall be treated as a change in direct
spending.
(f) Emergencies.--If after the enactment of this Act a provision of
direct spending or receipts legislation is enacted that is designated
as an emergency requirement by statute and that the President also
designates, in writing, as an emergency requirement within 5 days of
the enactment of that legislation, then no entries resulting from that
provision shall be made on the scorecard.
(g) Treatment of Certain Dedicated Excise Taxes.--For each fiscal
year, the scorecard shall also include only that part of the net
increase in receipts resulting from an increase in an excise tax
dedicated to a transportation trust fund that--
(1) was not specifically appropriated (as provided in
section 102(b)(6)); or
(2) to the extent specifically appropriated (as provided in
section 102(b)(6)), is not estimated to be expended in that
fiscal year.
SEC. 107. DISCRETIONARY SCORECARD.
(a) Establishment of Scorecard.--There shall be a scorecard for
each fiscal year starting with 1994 upon which shall be entered the
amount of discretionary appropriations for that fiscal year due to--
(1) the enactment of any law in the budget-year session,
(2) the enactment of any law in any previous session of
Congress, or
(3) the imposition of any sequestration under section 110.
Amounts shall be entered on the scorecard within 10 days after the
enactment of each such law or the imposition of any sequestration, and
may not thereafter be altered except to reflect decisions made by the
Board of Estimates or to correct clerical errors or errors in the
application of this Act.
(b) Lookback.--(1) If in any current-year session any discretionary
appropriation is enacted that would cause the discretionary funding
limit for the current year to be exceeded, then the amount of that
excess shall be entered on the scorecard under the column for the
budget year. To mandate year-after savings of amounts that would have
been saved but for the lower sequestration rule in that section,
entries shall also be made as specified in paragraphs (2) and (3) of
section 114(j).
(2) If any discretionary appropriation is enacted after June 30,
1993, and before October 1, 1993, that would have caused a look-back
sequester under section 251(a)(5) of the Balanced Budget and Emergency
Deficit Control Act of 1985 as in effect immediately before the date of
enactment of this Act, then the amount that would have been sequestered
shall be entered on the scorecard as a cost under the column for the
budget year.
SEC. 108. TARGETED SEQUESTRATION.
(a) Application.--This section shall apply for any budget year only
if a spin-off law as described in section 105 is in effect for that
year on the date of the final sequestration report described in section
114.
(b) Sequestration in Each Category Based on Budget-Year
Shortfall.--(1) The purpose of this subsection is to ensure that the
changes achieved during a session in direct spending for each category
and in receipts are at least as great as those required, or are no more
than those allowed, for the budget year.
(2) The amount to be sequestered for the budget year from direct
spending programs in each category is the amount by which changes in
direct spending achieved during the budget-year session are estimated
under section 106 to result in a greater amount of direct spending than
allowed in that category in the spin-off law.
(3) The amount that receipts are to be increased for the budget
year by the imposition of surtaxes is the amount by which changes in
receipts achieved during that budget-year session are estimated under
section 106 to result in lower total receipts for that year than
allowed in the spin-off law.
(c) Sequestration in Each Category Based on Outyear Shortfall.--(1)
The purpose of this subsection is to ensure that the outyear changes in
direct spending for each category and the outyear changes in receipts
achieved during a session are, on average, at least as great as those
required, or are no more than those allowed, for the budget year.
(2) The amount to be sequestered for the budget year in any
category under subsection (b)(2), if any, shall be increased whenever
the average outyear change in direct spending in that category achieved
during that budget-year session estimated under section 106 or
paragraph (4) would produce higher deficits during the outyears than if
that average change had equaled the budget-year target for changes in
direct spending in that category. That increased amount to be
sequestered (if applicable) shall be--
(A) one-quarter of the sum of those changes in direct
spending for the 4 outyears; minus
(B) the budget-year target for changes in direct spending.
(3) The amount that receipts are to be increased for the budget
year under subsection (b)(3), if any, shall be increased whenever the
average outyear change in receipts achieved during that budget-year
session estimated under section 106 or paragraph (4) would produce
higher deficits during the outyears than if that average change had
equaled the budget-year target for changes in receipts. That additional
amount that receipts are to be increased (if applicable) shall be--
(A) one-quarter of the sum of those changes in receipts for
the four outyears achieved; minus
(B) the budget-year target for changes in receipts.
(4) For any outyear after 1998, CBO and OMB shall make cost
estimates within 10 days after the enactment of any direct spending or
receipts legislation of the outyear effects of that legislation that
would have gone on the direct spending and receipts scorecard under
section 106(a) if the scorecard had covered that outyear.
(d) Fingerprint Rule.--For purposes of this section, the category
to which a change in direct spending is attributed shall be the
category of the committee that authored the change or reported the
legislation to which the change was offered as an amendment. If it is
impossible to tell which committee authored a change, the category to
which such a change is attributed shall be the category of the
committee with jurisdiction over the program that was changed, as
defined under section 100(9).
(e) Sequestration.--Within 15 days after Congress adjourns to end a
session and on the same day as a sequestration, if any, under section
110, there shall be a sequestration--
(1) to reduce the amount of direct spending in the current
policy baseline in any category by the sum of the amounts
specified in subsections (b)(2) and (c)(2) unless that sum is
less than $50,000,000; and
(2) to increase the amount of receipts in the current
policy baseline by the sum of the amounts specified in
subsections (b)(3) and (c)(3) unless that sum is less than
$250,000,000.
The amount required to be sequestered from direct spending in a
category shall be achieved by reducing each non-exempt direct spending
account (or activity within an account) within that category by the
uniform percentage necessary to achieve that amount. The amount to be
achieved by the imposition of a surtax shall be achieved as specified
in sections 59D, 59E, and 59F of the Internal Revenue Code of 1986.
SEC. 109. COMPREHENSIVE SEQUESTRATION.
(a) Application.--This section shall apply for any budget year
unless a spin-off law as described in section 105 is in effect for that
year on the date of the final sequestration report described in section
114.
(b) Sequestration Based on Budget-Year Shortfall.--The amount to be
sequestered for the budget year is the amount (if any) by which the sum
of all budget-year entries on the direct spending and receipts
scorecard under section 106 is greater than zero.
(c) Sequestration Based on Outyear Shortfall.--(1) The purpose of
this subsection is to ensure that the outyear changes in direct
spending and in receipts achieved during a session are, on average, at
least as great as those required, or are no more than those allowed,
for the budget year.
(2) The amount to be sequestered under subsection (b), if any,
shall be increased whenever the average outyear change in direct
spending and receipts, combined, achieved during that budget-year
session would result in higher deficits than if that average change had
equaled the amount targeted for the budget year, with that budget-year
target being the amount that the sequestration preview report for the
budget year shows was needed to bring the budget-year entries on the
direct spending and receipts scorecard to zero. That increased amount
to be sequestered shall be--
(A) one-quarter of the sum of those achieved changes in
direct spending and receipts, combined, for the 4 outyears;
minus
(B) the budget-year target for changes in direct spending
and receipts, combined.
(d) Sequestration.--Within 15 days after Congress adjourns to end a
session and on the same day as a sequestration, if any, under section
110, there shall be a sequestration to reduce the amount of direct
spending and increase the amount of receipts in the current policy
baseline by the sum of the amounts specified in subsections (b) and (c)
unless that sum is less than $500,000,000. The amount required to be
sequestered shall be achieved by reducing each non-exempt direct
spending account (or activity within an account) by the uniform
percentage, and increasing receipts by applying that uniform percentage
as specified in sections 59B and 59C of the Internal Revenue Code of
1986, necessary to achieve that amount.
SEC. 110. ACROSS-THE-BOARD REDUCTION OF DISCRETIONARY PROGRAMS.
(a) Sequestration.--Within 15 days after Congress adjourns to end a
session, and on the same day as a sequestration (if any) under section
108 or 109, there shall be a sequestration to reduce the amount of
discretionary sequestrable budget authority in the current policy
baseline for the budget year by the amount (if any) needed to eliminate
any excess of new budget authority for that year over the discretionary
funding limit for that year as measured under section 107, unless that
excess is less than $250,000,000.
(b) Uniform Reduction.--Each nonexempt account (or activity within
an account) shall be reduced by a dollar amount calculated by
multiplying the level of sequestrable budget authority in the baseline
for that account or activity by the uniform percentage necessary to
reduce new budget authority by the amount in subsection (a).
(c) Federal Personnel.--If the President uses the authority under
section 111(b) to exempt any amounts appropriated for military
personnel from sequestration, all remaining sequestrable budget
authority within subfunction 051 shall be further reduced by the
uniform percentage needed to fully offset the reduction in the amount
sequestered resulting from that exemption.
(d) Part-Year Appropriations.--If, on the date specified in
subsection (a), there is in effect an Act making or continuing
appropriations for part of a fiscal year for any budget account, then
the dollar reduction calculated for that account under subsections (b)
and (c) shall be applied to--
(1) the annualized amount otherwise available by law in
that account under that or a subsequent part-year
appropriation; and
(2) when a full-year appropriation for that account is
enacted, from the amount otherwise provided by that
appropriation.
SEC. 111. EXEMPT PROGRAMS AND ACTIVITIES.
(a) Descriptions and Lists.--Except as provided in subsection (c),
the following budget accounts, activities within accounts, or income
shall be exempt from sequestration--
(1) net interest;
(2) deposit insurance and pension benefit guarantees;
(3) all payments to trust funds from excise taxes or other
receipts or collections properly creditable to those trust
funds;
(4) offsetting receipts and collections;
(5) all payments from one Federal direct spending budget
account to another Federal budget account; all
intragovernmental funds including those from which funding is
derived primarily from other Government accounts, except to the
extent that such funds are augmented by direct appropriations
for the fiscal year for which the order is in effect; and those
obligations of discretionary accounts or activities that are
financed by intragovernmental payments from another
discretionary account or activity;
(6) expenses to the extent they result from private
donations, bequests, or voluntary contributions to the
Government;
(7) nonbudgetary activities, including but not limited to--
(A) credit liquidating and financing accounts;
(B) the Pension Benefit Guarantee Corporation Trust
Funds;
(C) the Thrift Savings Fund;
(D) the Federal Reserve System; and
(E) appropriations for the District of Columbia to
the extent they are appropriations of locally raised
funds;
(8) payments resulting from Government insurance,
Government guarantees, or any other form of contingent
liability, to the extent those payments result from contractual
or other legally binding commitments of the Government at the
time of any sequestration;
(9) the following accounts, which largely fulfill
requirements of the Constitution or otherwise make payments to
which the Government is committed--
Administration of Territories, Northern Mariana Islands
Covenant grants (14-0412-0-1-806);
Bureau of Indian Affairs, miscellaneous payments to Indians
(14-2303-0-1-452);
Bureau of Indian Affairs, miscellaneous trust funds, tribal
trust funds (14-9973-0-7-999);
Claims, defense;
Claims, judgments, and relief act (20-1895-0-1-806);
Compact of Free Association, economic assistance pursuant
to Public Law 99-658 (14-0415-0-1-806);
Compensation of the President (11-0001-0-1-802);
Customs Service, miscellaneous permanent appropriations
(20-9992-0-2-852);
Eastern Indian land claims settlement fund (14-2202-0-1-
806)
Farm Credit System Financial Assistance Corporation,
interest payments (20-1850-0-1-351);
Internal Revenue collections of Puerto Rico (20-5737-0-2-
852);
Panama Canal Commission, operating expenses and capital
outlay (95-5190-0-2-403);
Payments of Vietnam and USS Pueblo prisoner-of-war claims
(15-0104-0-1-153);
Payments to copyright owners (03-5175-0-2-376);
Payments to the United States territories, fiscal
assistance (14-0418-0-1-801);
Salaries of Article III judges;
Soldier's and Airmen's Home, payment of claims (84-8930-0-
7-705);
Washington Metropolitan Area Transit Authority, interest
payments (46-0300-0-1-401).
(10) the following noncredit special, revolving, or trust-
revolving funds--
Coinage profit fund (20-5811-0-2-803);
Exchange Stabilization Fund (20-4444-0-3-155);
Foreign Military Sales trust fund (11-82232-0-7-155);
(11)(A) any amount paid as regular unemployment
compensation by a State from its account in the Unemployment
Trust Fund (established by section 904(a) of the Social
Security Act);
(B) any advance made to a State from the Federal
unemployment account (established by section 904(g) of such
Act) under title XII of such Act and any advance appropriated
to the Federal unemployment account pursuant to section 1203 of
such Act; and
(C) any payment made from the Federal Employees
Compensation Account (as established under section 909 of such
Act) for the purpose of carrying out chapter 85 of title 5,
United States Code, and funds appropriated or transferred to or
otherwise deposited in such Account;
(12) the earned income tax credit (payments to individuals
pursuant to section 32 of the Internal Revenue Code of 1986).
(b) Optional Exemptions of Military Personnel.--(1) The President
may exempt some or all of the budgetary resources of any military
personnel account from sequestration under section 109.
(2) The President may not use the authority under paragraph (1)
unless he notifies the Congress of the extent to which such authority
will be exercised for the budget year on or before the preceding August
29.
(c) Federal Administrative Expenses.--
(1) Notwithstanding any provision of law other than
paragraph (3), administrative expenses incurred by the
departments and agencies, including independent agencies, of
the Federal Government in connection with any program, project,
activity, or account shall be subject to reduction pursuant to
any sequestration order, without regard to the exemptions under
subsection (a) and regardless of whether the program, project,
activity, or account is self-supporting and does not receive
appropriations.
(2) Payments made by the Federal Government to reimburse or
match administrative costs incurred by a State or political
subdivision under or in connection with any program, project,
activity, or account shall not be considered administrative
expenses of the Federal Government for purposes of this
section, and shall be subject to sequestration to the extent
(and only to the extent) that other payments made by the
Federal Government under or in connection with that program,
project, activity, or account are subject to that reduction or
sequestration; except that Federal payments made to a State as
reimbursement of administrative costs incurred by that State
under or in connection with the unemployment compensation
programs specified in subsection (a)(11) shall be subject to
reduction or sequestration under this part notwithstanding the
exemption otherwise granted to such programs under that
subsection.
(3) Notwithstanding any other provision of law, the
administrative expenses of the following programs shall be
exempt from sequestration:
(A) Deposit insurance.
(B) The Federal Retirement Thrift Investment Board.
(C) The Federal Reserve System.
SEC. 112. GENERAL AND SPECIAL SEQUESTRATION RULES.
(a) Permanent Sequestration of Direct Spending and Receipts.--
(1) The purpose of any direct spending or receipts
sequestration under this Act is to ensure deficit reduction in
the budget year and all subsequent fiscal years, so that the
budget-year deficit reduction target in section 101 is met and
so that it will be feasible to meet the increasingly ambitious
targets for the subsequent years.
(2) Obligations in sequestered direct spending accounts
shall be reduced in the fiscal year in which a sequestration
occurs and in all succeeding fiscal years. Notwithstanding any
other provision of this section, after the first direct
spending sequestration or receipts sequestration, any later
sequestration shall reduce direct spending or increase receipts
(as the case may be) by an amount in addition to, rather than
in lieu of, the reduction in direct spending or the increase in
receipts in place under the existing sequestration or
sequestrations.
(b) Uniform Percentages.--
(1) In calculating the uniform percentage applicable to the
sequestration of all nonexempt direct spending programs or
activities and receipts under section 109, or the uniform
percentage applicable to the sequestration of nonexempt direct
spending programs or activities within a category under section
108, the sequestrable base for direct spending rules and
activities is the total budget-year level of outlays for those
programs or activities in the current policy baseline minus--
(A) those budget-year outlays resulting from
obligations incurred in the current or prior fiscal
years, and
(B) those budget-year outlays resulting from
exemptions under section 111.
(2) For any direct spending program in which--
(A) outlays pay for entitlement benefits,
(B) a budget-year sequestration takes effect after
the 1st day of the budget year, and
(C) that delay reduces the amount of entitlement
authority that is subject to sequestration in the
budget year,
the uniform percentage otherwise applicable to the
sequestration of that program in the budget year shall be
increased as necessary to achieve the same budget-year outlay
reduction in that program as would have been achieved had there
been no delay.
(3) If the uniform percentage otherwise applicable to the
budget-year sequestration of a program or activity is increased
under paragraph (2), then it shall revert to the uniform
percentage calculated under paragraph (1) when the budget year
is completed.
(c) General Rules for Sequestration.--
(1) Indefinite authority.--Except as otherwise provided,
sequestration in accounts for which obligations are indefinite
shall be taken in a manner to ensure that obligations in the
fiscal year of a sequestration and succeeding fiscal years are
reduced, from the level that would actually have occurred, by
the applicable sequestration percentage or percentages.
(2) Cancellation of budgetary resources.--Budgetary
resources sequestered from any account other than an
entitlement trust, special, or revolving fund account shall
revert to the Treasury and be permanently canceled or repealed.
(3) Indexed benefit payments.--If, under any entitlement
program--
(A) benefit payments are made to persons or
governments more frequently than once a year, and
(B) the amount of entitlement authority is
periodically adjusted under existing law to reflect
changes in a price index,
then for the first fiscal year to which a sequestration order
applies, the benefit reductions in that program accomplished by
the order shall take effect starting with the payment made at
the beginning of January or 7 weeks after the order is issued,
whichever is later. For the purposes of this subsection,
Veterans Compensation shall be considered a program that meets
the conditions of the preceding sentence.
(4) Programs, projects, or activities.--Except as otherwise
provided, the same percentage sequestration shall apply to all
programs, projects, and activities within a budget account
(with programs, projects, and activities as delineated in the
appropriation Act or accompanying report for the relevant
fiscal year covering that account, or for accounts not included
in appropriation Acts, as delineated in the most recently
submitted President's budget).
(5) Implementing regulations.--Administrative regulations
or similar actions implementing the sequestration of a program
or activity shall be made within 120 days of the effective date
of the sequestration of that program or activity.
(6) Distribution formulas.--To the extent that distribution
or allocation formulas differ at different levels of budgetary
resources within an account, program, project, or activity, a
sequestration shall be interpreted as producing a lower total
appropriation, with that lower appropriation being obligated as
though it had been the pre-sequestration appropriation and no
sequestration had occurred.
(7) Contingent fees.--In any account for which fees charged
to the public are legally determined by the level of
appropriations, fees shall be charged on the basis of the
presequestration level of appropriations.
(d) Non-JOBS Portion of AFDC.--Any sequestration order shall
accomplish the full amount of any required reduction in payments for
the non-jobs portion of the aid to families with dependant children
program under the Social Security Act by reducing the Federal
reimbursement percentage (for the fiscal year involved) by multiplying
that reimbursement percentage, on a State-by-State basis, by the
uniform percentage applicable to the sequestration of nonexempt direct
spending programs or activities.
(e) JOBS Portion of AFDC.--
(1) Full amount of sequestration required.--Any
sequestration order shall accomplish the full amount of any
required reduction of the job opportunities and basic skills
training program under section 402(a)(19), and part F of title
VI, of the Social Security Act, in the manner specified in this
subsection. Such an order may not reduce any Federal matching
rate pursuant to section 403(l) of the Social Security Act.
(2) New allotment formula.--
(A) General rule.--Notwithstanding section 403(k)
of the Social Security Act, each State's percentage
share of the amount available after sequestration for
direct spending pursuant to section 403(l) of such Act
shall be equal to that percentage of the total amount
paid to the States pursuant to such section 403(l) for
the prior fiscal year that is represented by the amount
paid to such State pursuant to such section 403(l) for
the prior fiscal year, except that a State may not be
allotted an amount under this subparagraph that exceeds
the amount that would have been allotted to such State
pursuant to such section 403(k) had the sequestration
not been in effect.
(B) Reallotment of amounts remaining unallotted
after application of general rule.--Any amount made
available after sequestration for direct spending
pursuant to section 403(l) of the Social Security Act
that remains unallotted as a result of subparagraph (A)
of this paragraph shall be allotted among the States in
proportion to the absolute difference between the
amount allotted, respectively, to each State as a
result of such subparagraph and the amount that would
have been allotted to such State pursuant to section
403(k) of such Act had the sequestration not been in
effect, except that a State may not be allotted an
amount under this subparagraph that results in a total
allotment to the State under this paragraph of more
than the amount that would have been allotted to such
State pursuant to such section 403(k) had the
sequestration not been in effect.
(f) Child Support Enforcement Program.--Any sequestration order
shall accomplish the full amount of any required reduction in payments
under sections 455 and 458 of the Social Security Act by reducing the
Federal matching rate for State administrative costs under the program,
as specified (for the fiscal year involved) in section 455(a) of such
Act, to the extent necessary to reduce such expenditures by that
amount.
(g) Commodity Credit Corporation.--
(1) Effective date.--For the Commodity Credit Corporation,
the date on which a sequestration order takes effect in a
fiscal year shall vary for each crop of a commodity. In
general, the sequestration order shall take effect when issued,
but for each crop of a commodity for which 1-year contracts are
issued as an entitlement, the sequestration order shall take
effect with the start of the sign-up period for that crop that
begins after the sequestration order is issued. Payments for
each contract in such a crop shall be reduced under the same
terms and conditions.
(2) Dairy program.--(A) As the sole means of achieving any
reduction in outlays under the milk price-support program, the
Secretary of Agriculture shall provide for a reduction to be
made in the price received by producers for all milk produced
in the United States and marketed by producers for commercial
use. That price reduction (measured in cents per hundredweight
of milk marketed) shall occur under subparagraph (A) of section
201(d)(2) of the Agricultural Act of 1949 (7 U.S.C.
1446(d)(2)(A)), shall begin on the day any sequestration order
is issued, and shall not exceed the aggregate amount of the
reduction in outlays under the milk price-support program, that
otherwise would have been achieved by reducing payments made
for the purchase of milk or the products of milk under this
subsection during that fiscal year.
(3) Effect of delay.--For purposes of subsection (b)(1),
the sequestrable base for the Commodity Credit Corporation is
the budget-year level of gross outlays resulting from new
budget authority that is subject to reduction under paragraphs
(1) and (2), and subsection (b)(2) shall not apply.
(4) Certain authority not to be limited.--Nothing in this
Act shall restrict the Corporation in the discharge of its
authority and responsibility as a corporation to buy and sell
commodities in world trade, or limit or reduce in any way any
appropriation that provides the Corporation with funds to cover
its net realized losses.
(h) Conservation Reserve Program.--Multiyear contracts under the
conservation reserve program shall be considered binding and not
subject to sequestration, but any contract entered into after a
sequestration applicable to that program takes effect shall provide for
payments reduced by the uniform percentage or percentages applicable to
that sequestration.
(i) Extended Unemployment Compensation.--(1) A State may reduce
each weekly benefit payment made under the Federal-State Extended
Unemployment Compensation Act of 1970 for any week of unemployment
occurring during any period with respect to which payments are reduced
under any sequestration order by a percentage not to exceed the
percentage by which the Federal payment to the State under section 204
of such Act is to be reduced for such week as a result of such order.
(2) A reduction by a State in accordance with subparagraph (A)
shall not be considered as a failure to fulfill the requirements of
section 3304(a)(11) of the Internal Revenue Code of 1986.
(j) Federal Employees Health Benefits Fund.--For the Federal
Employees Health Benefits Fund, a sequestration order shall take effect
with the next open season. The sequestration shall be accomplished by
annual payments from that Fund to the General Fund of the Treasury.
Those annual payments shall be financed solely by charging higher
premiums. For purposes of subsection (b)(1), the sequestrable base for
the Fund is the budget-year level of gross outlays resulting from
claims paid after the sequestration order takes effect, and subsection
(b)(2) shall not apply.
The premium increases under paragraph (2) shall begin with the open
season that occurs nearest to September 30 of the fiscal year to which
the sequestration first applies. If those premium increases take effect
in the first fiscal year of a sequestration, the amount collected by
the Fund in that fiscal year as a result shall be used to partially
finance the payment to the Treasury required in that year, and the
amount of the recall under paragraph (1) shall be diminished
accordingly.
(k) Federal Housing Finance Board.--Any sequestration of the
Federal Housing Finance Board shall be accomplished by annual payments
(by the end of each fiscal year) from that Board to the general fund of
the Treasury, in amounts equal to the uniform sequestration percentage
for that year times the gross obligations of the Board in that year.
(l) Federal Pay.--
(1) In general.--Except as provided in section 111(b)(3),
new budget authority to pay Federal personnel shall be reduced
by the uniform percentage calculated under section 108, 109, or
110, as applicable, but no sequestration order may reduce or
have the effect of reducing the rate of pay to which any
individual is entitled under any statutory pay system (as
increased by any amount payable under section 5304 of title 5,
United States Code, or section 302 of the Federal Employees Pay
Comparability Act of 1990) or the rate of any element of
military pay to which any individual is entitled under title
37, United States Code, or any increase in rates of pay which
is scheduled to take effect under section 5303 of title 5,
United States Code, section 1009 of title 37, United States
Code, or any other provision of law.
(2) Definitions.--For purposes of this subsection:
(A) The term ``statutory pay system'' shall have
the meaning given that term in section 5302(1) of title
5, United States Code.
(B) The term ``elements of military pay'' means--
(i) the elements of compensation of members
of the uniformed services specified in section
1009 of title 37, United States Code,
(ii) allowances provided members of the
uniformed services under sections 403a and 405
of such title, and
(iii) cadet pay and midshipman pay under
section 203(c) of such title.
(C) The term ``uniformed services'' shall have the
meaning given that term in section 101(3) of title 37,
United States Code.
(m) Guaranteed Student Loans.--(A) For all student loans under part
B of title IV of the Higher Education Act of 1965 made on or after the
date of a sequestration, the origination fees shall be increased by a
uniform percentage sufficient to produce the dollar savings in student
loan programs for the fiscal year of the sequestration required by
section 108 or 109, and all subsequent origination fees shall be
increased by the same percentage, notwithstanding any other provision
of law.
(B) The origination fees to which paragraph (A) applies are those
specified in sections 428H(f)(1) and 438(c) of that Act.
(n) Insurance Programs.--Any sequestration in a Federal program
that sells insurance contracts to the public (including the Federal
Crop Insurance Fund, the National Insurance Development Fund, the
National Flood Insurance Fund, insurance activities of the Overseas
Private Insurance Corporation, and Veterans' life insurance programs)
shall be accomplished by annual payments from the insurance fund or
account to the general fund of the Treasury. The amount of each annual
payment by each such fund or account shall be the amount received by
the fund or account by increasing premiums on contracts entered into
after the date a sequestration order takes effect by the uniform
sequestration percentage, and premiums shall be increased accordingly.
(o) Medicaid.--The November 15th estimate of medicaid spending by
States shall be the base estimate from which the uniform percentage
reduction under any sequestration, applied across-the-board by State,
shall be made. Succeeding Federal payments to States shall reflect that
reduction. The Health Care Financing Administration shall reconcile
actual medicaid spending for each fiscal year with the base estimate as
reduced by the uniform percentage, and adjust each State's grants as
soon as practicable, but no later than 100 days after the end of the
fiscal year to which the base estimate applied, to comply with the
sequestration order.
(p) Medicare.--
(1) Timing of application of reductions.--
(A) In general.--Except as provided in subparagraph
(B), if a reduction is made in payment amounts pursuant
to a sequestration order, the reduction shall be
applied to payment for services furnished after the
effective date of the order. For purposes of the
previous sentence, in the case of inpatient services
furnished for an individual, the services shall be
considered to be furnished on the date of the
individual's discharge from the inpatient facility.
(B) Payment on the basis of cost reporting
periods.--In the case in which payment for services of
a provider of services is made under title XVIII of the
Social Security Act on a basis relating to the
reasonable cost incurred for the services during a cost
reporting period of the provider, if a reduction is
made in payment amounts pursuant to a sequestration
order, the reduction shall be applied to payment for
costs for such services incurred at any time during
each cost reporting period of the provider any part of
which occurs after the effective date of the order, but
only (for each such cost reporting period) in the same
proportion as the fraction of the cost reporting period
that occurs after the effective date of the order.
(2) No increase in beneficiary charges in assignment-
related cases.--If a reduction in payment amounts is made
pursuant to a sequestration order for services for which
payment under part B of title XVIII of the Social Security Act
is made on the basis of an assignment described in section
1842(b)(3)(B)(ii), in accordance with section 1842(b)(6)(B), or
under the procedure described in section 1870(f)(1) of such
Act, the person furnishing the services shall be considered to
have accepted payment of the reasonable charge for the
services, less any reduction in payment amount made pursuant to
a sequestration order, as payment in full.
(3) No effect on computation of aapcc.--In computing the
adjusted average per capita cost for purposes of section
1876(a)(4) of the Social Security Act, the Secretary of Health
and Human Services shall not take into account any reductions
in payment amounts which have been or may be effected under
this part.
(q) Postal Service Fund.--Any sequestration of the Postal Service
Fund shall be accomplished by annual payments from that Fund to the
General Fund of the Treasury, and the Postmaster General of the United
States shall have the duty to make those payments during the fiscal
year to which the sequestration order applies and each succeeding
fiscal year. The amount of each annual payment shall be--
(1) the uniform sequestration percentage, times
(2) the estimated gross obligations of the Postal Service
Fund in that year other than those obligations financed with an
appropriation for revenue foregone for that year.
Any such payment for a fiscal year shall be made as soon as possible
during the fiscal year, except that it may be made in installments
within that year if the payment schedule is approved by the Secretary
of the Treasury. Within 30 days after the sequestration order is
issued, the Postmaster General shall submit to the Postal Rate
Commission a plan for financing the annual payment for that fiscal year
and publish that plan in the Federal Register. The plan may assume
efficiencies in the operation of the Postal Service, reductions in
capital expenditures, increases in the prices of services, or any
combination, but may not assume a lower Fund surplus or higher Fund
deficit and must follow the requirements of existing law governing the
Postal Service in all other respects. Within 30 days of the receipt of
that plan, the Postal Rate Commission shall approve the plan or modify
it in the manner that modifications are allowed under current law. If
the Postal Rate Commission does not respond to the plan within 30 days,
the plan submitted by the Postmaster General shall go into effect. Any
plan may be later revised by the submission of a new plan to the Postal
Rate Commission, which may approve or modify it.
(r) Power Marketing Administrations and T.V.A.--Any sequestration
of the Department of Energy power marketing administration funds or the
Tennessee Valley Authority fund shall be accomplished by annual
payments from those funds to the General Fund of the Treasury, and the
administrators of those funds shall have the duty to make those
payments during the fiscal year to which the sequestration order
applies and each succeeding fiscal year. The amount of each annual
payment by a fund shall be--
(1) the direct spending uniform sequestration percentage,
times
(2) the estimated gross obligations of the fund in that
year other than those obligations financed from discretionary
appropriations for that year.
Any such payment for a fiscal year shall be made as soon as possible
during the fiscal year, except that it may be made in installments
within that year if the payment schedule is approved by the Secretary
of the Treasury. Annual payments by a fund may be financed by
reductions in costs required to produce the presequester amount of
power (but those reductions shall not include reductions in the amount
of power supplied by the fund), by reductions in capital expenditures,
by increases in rates, or by any combination, but may not be financed
by a lower fund surplus or a higher fund deficit and must follow the
requirements of existing law governing the fund in all other respects.
The administrator of a fund or the TVA Board is authorized to take the
actions specified above in order to make the annual payments to the
Treasury.
(s) Uranium Enrichment.--Any sequestration of the uranium
enrichment program shall be accomplished through annual payments from
that program to the general fund of the Treasury, and the program
administrator shall have the duty to make those payments during the
fiscal year to which the sequestration order applies and each
succeeding fiscal year. The Secretary of Energy has the authority to
reduce costs or increase receipts, or a combination, as necessary to
finance those annual payments.
(t) Veterans' Housing Loans.--(1) For all housing loans guaranteed,
insured, or made under chapter 37 of title 38, United States Code, on
or after the date of a sequestration, the origination fees shall be
increased by a uniform percentage sufficient to produce the dollar
savings in veterans' housing programs for the fiscal year of the
sequestration required by section 108 or 109, and all subsequent
origination fees shall be increased by the same percentage,
notwithstanding any other provision of law.
(2) The origination fees to which paragraph (1) applies are those
referred to in section 3729 of title 38, United States Code.
SEC. 113. SEQUESTRATION THROUGH TAX CHANGES.
(a) General Rule.--Subchapter A of chapter 1 of the Internal
Revenue Code of 1986 (relating to determination of tax liability) is
amended by adding at the end thereof the following new part:
``PART VIII--TAX SEQUESTRATION PROVISIONS
``Subpart A. Increase in top marginal
rate.
``Subpart B. Modification of indexing
provisions.
``Subpart C. Imposition of surtaxes.
``Subpart A--Increase in Top Marginal Rate
``Sec. 59B. Increase in top marginal
rate.
``SEC. 59B. INCREASE IN TOP MARGINAL RATE.
``(a) General Rule.--Subject to the limitations of section 1(h),
the amount of the tax imposed by section 1 for any taxable year shall
be increased by the applicable deficit reduction percentage of the
excess (if any) of--
``(1) taxable income, over
``(2) the applicable dollar amount.
``(b) Applicable Deficit Reduction Percentage.--For purposes of
this section--
``(1) In general.--The term `applicable deficit reduction
percentage' means, with respect to a taxable year beginning in
a calendar year, the sum, rounded up to the nearest 0.5
percentage points, of--
``(A) the uniform percentage (if any) determined
under paragraph (2) for such calendar year, plus
``(B) the sum of the uniform percentages (if any)
for all preceding calendar years.
``(2) Uniform percentage.--The uniform percentage for a
calendar year is the uniform percentage included in the final
sequestration report effectuated by the sequestration order
under section 114 of the Deficit Elimination Act of 1993 for
the fiscal year in which the calendar year begins.
``(c) Applicable Dollar Amount.--For purposes of this section--
``(1) In general.--
In the case of a taxpayer
to whom the following subsection The applicable
of section 1 applies: dollar amount is:
Subsection (a)......................................$200,000
Subsection (b)......................................$170,000
Subsection (c)......................................$120,000
Subsection (d)......................................$100,000
Subsection (e)......................................$ 25,000
``(2) Adjustments for inflation.--In the case of a taxable
year beginning in a calendar year after 1993, each dollar
amount contained in paragraph (1) shall be increased by an
amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined
under section 1(f)(3) for the calendar year in which
the taxable year begins by substituting `calendar year
1992' for `calendar year 1989' in subparagraph (B)
thereof.
The rule of section 1(f)(6) (relating to rounding) shall apply
to any increase determined under this paragraph.
``(d) Secton 15 Not To Apply.--Section 15 shall not apply to any
change in rates under this section.
``Subpart B--Modifications to Indexing Provisions
``Sec. 59C. Modification to indexing
provisions.
``SEC. 59C. MODIFICATIONS TO INDEXING PROVISIONS.
``(a) General Rule.--If this section applies to any calendar year--
``(1) the amount of each indexed dollar amount which would
otherwise be applicable under any provision of this chapter to
taxable years beginning in such calendar year shall be reduced
by an amount equal to--
``(A) the indexed dollar amount applicable under
such provision for taxable years beginning in the
preceding calendar year, multiplied by
``(B) the uniform percentage, and
``(2) for purposes of determining indexed dollar amounts
which apply under such provision to taxable years beginning in
subsequent calendar years--
``(A) the indexed dollar amount determined under
paragraph (1) shall be treated as the original dollar
amount set forth in such provision, and
``(B) corresponding adjustments to the base period
used in computing the cost-of-living adjustments shall
be made.
The rules of section 1(f)(6) (relating to rounding) shall apply to
indexed dollar amounts determined under paragraph (1).
``(b) Years to Which Section Applies.--This section shall apply to
any calendar year if the final sequestration report effectuated by the
sequestration order under section 114 of the Deficit Elimination Act of
1993 for the fiscal year in which the calendar year begins includes a
uniform percentage.
``(c) Uniform Percentage.--The uniform percentage for a calendar
year is the uniform percentage included in the final sequestration
report effectuated by the sequestration order under section 114 of the
Deficit Elimination Act of 1993 for the fiscal year in which the
calendar year begins.
``(d) Indexed Dollar Amount.--For purposes of this section--
``(1) In general.--Except as provided in paragraph (2), the
term `indexed dollar amount' means any dollar amount contained
in any provision of this chapter if there are annual
adjustments to such amount based on changes in the Consumer
Price Index (as defined in section 1(f)(5)).
``(2) Exception for earned income credit limitations.--The
term `indexed dollar amount' shall not include any dollar
amount contained in section 32.
``Subpart C--Imposition of Surtaxes
``Sec. 59D. Imposition of surtax on
individuals.
``Sec. 59E. Imposition of surtax on
corporations.
``Sec. 59F. Definitions and special
rules.
``SEC. 59D. IMPOSITION OF SURTAX ON INDIVIDUALS.
``(a) Section 1.--In the case of an individual, the amount of the
tax imposed under section 1 for any taxable year shall be increased by
the applicable surtax percentage of the tax imposed under section 1 for
such taxable year (determined without regard to this section).
``(b) Minimum Tax.--In the case of an individual, the amount of the
tentative minimum tax determined under section 55 for any taxable year
shall be increased by the applicable surtax percentage of the amount of
the tentative minimum tax for such taxable year (determined without
regard to this section).
``(c) Surtax To Apply to Estates and Trusts.--For purposes of this
section, the term `individual' includes any estate or trust taxable
under section 1.
``(d) Coordination With Other Provisions.--The provisions of this
section--
``(1) shall be applied after the application of the
preceding provisions of this part and section 1(h), but
``(2) before the application of any other provision of this
title which refers to the amount of the tax imposed by section
1 or 55, as the case may be.
``SEC. 59E. IMPOSITION OF SURTAX ON CORPORATIONS.
``(a) Normal Corporate Tax.--
``(1) In general.--In the case of a corporation, the amount
of the tax imposed under section 11 for any taxable year shall
be increased by the applicable surtax percentage of the amount
of the tax imposed under section 11 for such taxable year
(determined without regard to this section).
``(2) Treatment of certain taxes.--For purposes of
paragraph (1), a tax shall be treated as imposed under section
11 if the amount of such tax is determined by reference to the
provisions of section 11 (or by reference to any rate contained
therein).
``(b) Minimum Tax.--In the case of a corporation, the amount of the
tentative minimum tax determined under section 55 for any taxable year
shall be increased by the applicable surtax percentage of the amount of
the tentative minimum tax for such taxable year (determined without
regard to this section).
``(c) Coordination With Other Provisions.--The provisions of this
section shall be applied--
``(1) after the application of section 1201 and 801(a)(2),
but
``(2) before the application of any other provision of this
title which refers to the amount of tax imposed by section 11
or 55, as the case may be.
``SEC. 59F. DEFINITIONS AND SPECIAL RULES.
``(a) Applicable Surtax Percentage.--For purposes of this subpart--
``(1) In general.--The term `applicable surtax percentage'
means, with respect to a taxable year beginning in a calendar
year, the sum, rounded up to the nearest 0.5 percentage point,
of--
``(A) the surtax percentage (if any) determined
under paragraph (2) for such calendar year, plus
``(B) the sum of the surtax percentages (if any)
for all preceding calendar years.
``(2) Surtax percentage.--The surtax percentage for a
calendar year is the surtax percentage included in the final
sequestration report effectuated by the sequestration order
under section 114 of the Deficit Elimination Act of 1993 for
the fiscal year in which the calendar year begins.
``(b) Section 15 Not To Apply.--Section 15 shall not apply to any
change in rates under this subpart.
``(c) Adjustment to Application of Certain Provisions.--
``(1) Dividends paid on certain preferred stock.--In
computing for a taxable year of a corporation the fractions
described in sections 244(a)(2) and 247(a)(2), the denominator
shall, under regulations prescribed by the Secretary, be
increased to reflect the provisions of this part.
``(2) Shareholders of regulated investment companies.--In
computing the adjustment to basis described in section
852(b)(3)(D)(iii), the percentage set forth therein shall be
adjusted, under regulations prescribed by the Secretary, to
reflect the provisions of this subpart.''
(b) Clerical Amendment.--The table of parts for subchapter A of
chapter 1 of such Code is amended by adding at the end thereof the
following new item:
``Part VIII. Tax sequestration
provisions.''
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1993.
SEC. 114. ESTIMATING ASSUMPTIONS, REPORTS, AND ORDERS.
(a) Timetable.--The timetable with respect to this part for any
budget year is as follows:
Date: Action to be completed:
Dec. 31........................
OMB and CBO sequestration
preview reports
submitted to Board.
Jan. 15........................
Board selects sequestration
preview report.
The President's budget
submission.
OMB publishes sequestration
preview report.
August 29:.....................
President's midsession review;
notification regarding
military personnel.
Within 10 days after end of
session.
OMB and CBO final budget year
sequestration reports
submitted to Board.
5 days later...................
Board selects final
sequestration report;
President issues
sequestration order.
(b) Submission and Availability of Reports.--Each report required
by this section shall be submitted, in the case of CBO, to the House of
Representatives, the Senate, OMB, and the Board and, in the case of
OMB, to the House of Representatives, the Senate, the President, and
the Board on the day it is issued. On the following day a notice of the
report shall be printed in the Federal Register.
(c) Exchange of Preliminary Current Policy Baselines.--On December
15 or 3 weeks after Congress adjourns to end a session, whichever is
later, OMB and CBO shall exchange their preliminary current policy
baselines for the budget-year session starting in January.
(d) Sequestration Preview Reports.--
(1) Reporting requirement.--On December 31 or 2 weeks after
exchanging preliminary current policy baselines, whichever is
later, OMB and CBO shall each submit a sequestration preview
report.
(2) Contents.--Each preview report shall set forth the
following:
(A) Major estimating assumptions.--The major
estimating assumptions for the current year, the budget
year, and the outyears, and an explanation of them.
(B) Current policy baseline.--A detailed display of
the current policy baseline for the current year, the
budget year, and the outyears, with an explanation of
changes in the baseline since it was last issued that
includes the effect of policy decisions made during the
intervening period and an explanation of the
differences between OMB and CBO for each item set forth
in the report.
(C) Deficits assuming compliance.--Estimates for
the budget year and each subsequent year through fiscal
year 1998 of the deficits or surpluses in the current
policy baseline assuming deficit reduction specified in
section 116.
(D) Discretionary funding limits.--(i) estimates
for the current year, the budget year, and each outyear
through 1998 of the discretionary funding limits and an
explanation of each adjustment made to those limits
under section 102(b), (ii) starting with fiscal year
1998, an estimate of the aggregate first-year spendout
rate for the budget year for discretionary programs,
(iii) starting with budget year 1998, an estimate for
the current year and for the budget year of the
discretionary funding limits under the spinoff law
under section 105, or if no such law exists for a
fiscal year, for those limits established under the
automatic application of section 103 or 104.
(E) Sequestration of discretionary accounts.--
Estimates of the uniform percentage and the amount of
budgetary resources to be sequestered from
discretionary programs given the baseline level of
appropriations, and if the President chooses to exempt
some or all military personnel from sequestration, the
effect of that decision on the percentage and amounts.
(F) Deficit reduction requirements for direct
spending and receipts.--An estimate for direct spending
and receipts of the deficit reduction remaining to be
achieved for the budget year under section 101 or 104
or of the decrease in the surplus allowed for that year
under section 104 (given the amount already achieved as
measured under section 106).
(G) Direct spending sequestration.-- Estimates of
the uniform percentage and the amount of targeted
sequestration under section 108 that will be necessary
in each direct spending category to meet the direct
spending targets for the budget year in the spin-off
law under section 105, or if no such law has been
enacted for the budget year, the uniform percentage and
the amount of comprehensive sequestration of direct
spending programs that will be necessary under section
109.
(H) Receipts sequestration.--Estimates of the
increase in receipts under section 108 that will be
necessary to meet the receipts targets for the budget
year in the spin-off law under section 105, or if no
such law has been enacted for the budget year, the
increase in receipts that will be necessary under
section 109; including the surtax percentage needed to
achieve the increase in receipts required under section
108 or the uniform percentage under section 109.
(e) Selection of Official Sequestration Preview Report.--On January
15 or 2 weeks after receiving the OMB and CBO sequestration preview
reports, whichever is later, the Board shall choose either the OMB or
CBO sequestration preview report as the official report for purposes of
this Act. The Board shall add to the chosen report an analysis of which
reports submitted in previous years have proven to be more accurate and
recommendations about methods of improving the accuracy of future
reports. That report shall be set forth, without change, in the budget
submitted by the President under section 1105(a) of title 31, United
States Code, for the budget year.
(f) Agreeing on Earlier Dates.--The Chairman of the Board may set
earlier dates for subsections (c), (d), and (e) if OMB and CBO concur.
(g) Notification Regarding Military Personnel.--On or before August
29, the President shall notify the Congress of the manner in which he
intends to exercise flexibility with respect to military personnel
accounts under section 111(b).
(h) Final Sequestration Reports.--
(1) Reporting requirement.--Not later than 10 days
following the end of a budget-year session, OMB and CBO shall
each submit a final sequestration report.
(2) Contents.--That report shall be based upon laws enacted
through the date of the report and shall set forth all the
information and estimates required of a sequestration preview
report required by subsections (d)(2)(D) through (H). In
addition, that report shall include--
(A) for each account to be sequestered, the
baseline level of sequestrable budgetary resources and
the resulting reductions in new budget authority and
outlays;
(B) the effects of sequestration on the level of
direct spending outlays for each fiscal year through
1998; and
(C) the effects of sequestration on the level of
receipts for each fiscal year through 1998.
(i) Selection of Official Final Sequestration Report.--Not later
than 5 days after receiving the final OMB and CBO sequestration
reports, the Board shall choose either the OMB or CBO final
sequestration report as the official report for purposes of this Act,
and shall issue a report stating that decision and making any comments
that the Board chooses.
(j) Presidential Order.--(1) On the day that the Board chooses a
final sequestration report, the President shall issue an order fully
implementing without change all sequestrations and tax actions required
by--
(A) the final sequestration report that requires the lesser
amount of discretionary sequestration under section 110; and
(B) the final sequestration report that requires the lesser
total amount of direct spending and receipts sequestration
under section 108 or 109 (as applicable).
The order shall be effective on issuance and shall be issued only if
sequestration is required.
(2)(A) If both the CBO and OMB final sequestration reports require
a sequestration of discretionary programs, and the Board chooses the
report requiring the greater sequestration, then a positive amount
equal to the difference between the CBO and OMB estimates of
discretionary new budget authority for the budget year shall be
subtracted from the budget-year column and added to the column for the
first outyear of the discretionary scorecard under section 107 as
though that amount had been enacted in the next session of Congress.
(B) If one final sequestration report requires a sequestration of
discretionary programs and the Board chooses that report, then an
amount equal to the difference between that report's estimate of
discretionary new budget authority for the budget year and the
discretionary funding limit for that year shall be subtracted from the
budget-year column and added to column for the first outyear of the
discretionary scorecard under section 107 as though that amount had
been enacted in the next session of Congress.
(3)(A) If both the CBO and OMB final sequestration reports require
a sequestration of direct spending or receipts, and the Board chooses
the report requiring the greater sequestration, then a positive amount
equal to the difference between the total CBO and OMB estimates of
required budget-year direct spending and receipts sequestrations shall
be subtracted from the budget-year column and added to the column for
the first outyear of the direct spending and receipts scorecard under
section 106 as though that amount had been enacted in the next session
of Congress.
(B) If one final sequestration report requires a sequestration of
direct spending or receipts and the Board chooses that report, then the
estimate of total required budget-year direct spending and receipts
sequestrations shall be subtracted from the budget-year column and
added to column for the first outyear of the direct spending and
receipts scorecard under section 106 as though that amount had been
enacted in the next session of Congress.
(k) Low-Growth Report.--At any time until the end of fiscal year
1997, the Director of the Board shall notify the Congress if--
(1) during the period consisting of the quarter during
which such notification is given, the quarter preceding that
notification, and the 4 quarters following that notification,
CBO or OMB has determined that real economic growth is
projected or estimated to be less than zero for each of any 2
consecutive quarters within that period; or
(2) the most recent of the Department of Commerce's
advance, preliminary, or final reports of actual real economic
growth for each of the most recently reported quarter and the
immediately preceding quarter is less than 1 percent.
(l) Use of Major Estimating Assumptions and Scorekeeping
Conventions.--In the estimates, projections, and reports under
subsections (c) and (d), CBO and OMB shall use the best and most recent
estimating assumptions available. In all other reports required by this
section and in all estimates or calculations required by this Act, CBO
and OMB shall use--
(1) current-year and budget-year discretionary funding
limits chosen by the Board and the estimates chosen by the
Board of the deficit reduction (or decrease in the surplus)
through changes in direct spending and receipts required (or
allowed) in the budget year;
(2) in estimating the effects of bills and discretionary
regulations, the major estimating assumptions most recently
chosen by the Board, except to the extent that they must be
altered to reflect actual results occurring or measured after
the Board's choice; and
(3) scorekeeping conventions determined after consultation
among the House and Senate Committees on the Budget, CBO, and
OMB.
In applying the two previous sentences, the major estimating
assumptions and other calculations required by this Act that are
included in the statement of managers accompanying the conference
report on this Act shall be considered, for all purposes of this Act,
to be the report of the Board chosen under subsection (e) for fiscal
year 1993.
(m) Bill Cost Estimates.--Within 10 days after the enactment of any
discretionary appropriations, direct spending, or receipts legislation,
CBO and OMB shall transmit to each other, the Board, and to the
Congress an estimate of the budgetary effects of that law, following
the estimating requirements of this section. Those estimates may not
change after the 10-day period except--
(1) to the extent those estimates are subsumed within (and
implicitly changed by) the estimates made in preparation of a
new baseline under subsections (c), (d), and (h);
(2) to reflect a choice of the Board regarding an official
set of estimates under subsections (l) and (n); and
(3) to correct clerical errors or errors in the application
of this Act.
SEC. 115. THE CURRENT POLICY BASELINE.
(a) In General.--For any budget year, the baseline refers to a
projection of current-year levels of new budget authority, outlays,
revenues, and the surplus or deficit into the budget year and the
outyears based on laws enacted through, and discretionary regulations
promulgated as final by, the applicable date.
(b) Direct Spending and Receipts.--For the current year, the budget
year, and each outyear, the baseline shall be calculated using the
following assumptions:
(1) In general.--Laws providing or creating direct spending
and receipts are assumed to operate in the manner specified in
those laws for each such year, funding for entitlement
authority is assumed to be adequate to make all payments
required by those entitlements, and funding for deposit
insurance is assumed to be adequate to meet the costs of the
Financial Institutions Reform, Recovery, and Enforcement Act of
1989 or successor laws.
(2) Exceptions.--Except as provided in paragraph (3):
(A) No program with estimated current-year gross
new budget authority greater than $100 million is
assumed to expire in the budget year or outyears. In
carrying out the preceding sentence, expiring
entitlement programs and programs financed by
indefinite budget authority are assumed to continue as
in effect just prior to their expiration, and other
expiring programs are assumed to continue with new
budget authority projected as under subsection (c)(4).
(B) The percentage increase for veterans'
compensation for a fiscal year is assumed to be the
same as that required by law for veterans' pensions
unless otherwise provided by a law enacted in that
session.
(C) Excise taxes dedicated to a trust fund, if
expiring, are assumed to continue at the rates in
effect immediately prior to their expiration.
(3) Cutoff date.--Programs or taxes that expire on or
before December 31 and that have not been reauthorized by the
date of the final sequestration report are assumed to expire.
If an increase in veterans compensation has not been enacted by
the date of the final sequestration report, it is not assumed.
(c) Discretionary Appropriations.--For the current year, the budget
year, and each outyear, the baseline shall be calculated using the
following assumptions regarding discretionary programs:
(1) Inflation of current-year appropriations.--New budget
authority shall be at the level provided for that fiscal year
in appropriation Acts. If for any account an appropriation has
not yet been enacted, new budget authority is assumed to be at
the level available in the current year, adjusted sequentially
and cumulatively for expiring housing contracts as specified in
paragraph (2), for social insurance administrative expenses as
specified in paragraph (3), for inflation as specified in
paragraph (4), and to account for changes required by law in
the level of agency payments for personnel benefits other than
pay.
(2) Expiring housing contracts.--New budget authority to
renew expiring multiyear subsidized housing contracts or
provide contracts to replace units lost due to prepayments
shall be adjusted to reflect the difference in the number of
such contracts that are estimated to expire or be prepaid in
that fiscal year and the number expiring or being prepaid in
the current year, with the per-contract renewal/replacement
cost equal to the average current-year cost of renewal or
replacement contracts.
(3) Social insurance administrative expenses.--New budget
authority for the administrative expenses of the following
trust funds shall be adjusted by the percentage change in the
beneficiary population or number of claims, as applicable, from
the current year to that fiscal year: the Federal Old-Age and
Survivors Insurance Trust Fund, the Federal Disability
Insurance Trust Fund, the Federal Hospital Insurance Trust
Fund, the Supplementary Medical Insurance Trust Fund, the
Unemployment Trust Fund, and the railroad retirement account.
(4) Inflators.--The inflator to adjust new budget authority
relating to personnel is the percent by which the average rate
of basic pay for statutory pay systems, computed as specified
in section 5303(a) of title 5, United States Code, for that
fiscal year exceeds the average rate of pay for the current
year. The inflator to adjust all other budgetary resources is
the percent by which the average of the estimated gross
domestic product fixed-weight price index for that fiscal year
differs from the average of such estimated index for the
current year.
(5) Part-year appropriations; permissive transfers.--If,
for any account, a continuing appropriation is in effect for
less than an entire fiscal year, then the amount available for
that fiscal year is assumed to equal the amount that would be
available if that continuing appropriation covered the entire
fiscal year. If law permits the transfer of budget authority
among budget accounts in the current year, the current-year
level for an account shall reflect transfers accomplished by
the applicable date or assumed for the current year in the
President's original budget or midsession review for the budget
year.
(d) Up-to-Date Concepts.--In deriving the baseline for any budget
year or outyear, current-year amounts shall be calculated using the
concepts and definitions that are required for that budget year.
SEC. 116. BASELINE ASSUMING DEFICIT REDUCTION.
For any budget year, a baseline assuming deficit reduction refers
to a projection of current policy baseline surpluses or deficits into
the budget year and the outyears that is adjusted in aggregate by--
(1) assuming compliance with the deficit reduction targets
for direct spending and receipts legislation under section 101
without any adjustment pursuant to section 103;
(2) assuming compliance with the discretionary funding
limits under section 102 without any adjustment pursuant to
section 103; and
(3) excluding amounts resulting from legislation that has
been designated as an emergency requirement under section
102(b)(4) or 106(f).
SEC. 117. STABILIZATION RESERVE FUND.
(a) Establishment and Purpose.--There is hereby established as a
deposit fund in the Treasury a Stabilization Reserve Fund (``Fund''),
to be administered by the Secretary of the Treasury. The purpose of
that Fund is to accumulate balances during years of comparative
prosperity, which balances may later be used to cover the loss of
receipts and the increase in outlays that occur during times of
comparative economic distress.
(b) Amounts Paid to the Fund.--On the last day of any fiscal year
for which an actual surplus has occurred, the amount of that surplus
shall be paid to the Fund. In fiscal year 1999, the Secretary of the
Treasury shall pay an additional $10.0 billion from the general fund of
the Treasury to the Fund. In each fiscal year starting with 2000, the
Secretary of the Treasury shall pay an additional $20.0 billion to the
Fund from the general fund of the Treasury. Balances in the Fund shall
not receive interest.
(c) Transfer of Fund Balances.--At any time starting with the
fiscal year 1999 session, a law may be enacted withdrawing some or all
of the current balance of the Stabilization Reserve Fund and paying
that amount, as a receipt, to the General Fund of the Treasury. That
law may also provide for the later transfer to the Treasury (as a
receipt) of some or all of the current-year estimated surplus (if any),
to be paid into the Stabilization Reserve Fund at the end of the
current year under subsection (b). Except for transfers to the General
Fund of the Treasury, no law reducing the balances of the Stabilization
Reserve Fund may be enacted in any year.
SEC. 118. MODIFICATIONS IF WAR OR LOW GROWTH.
(a) War.--Upon the enactment of a declaration of war--
(1) the subsequent issuance of any sequestration report or
any sequestration order is precluded;
(2) sections 302(f), 310(d), and 311 of the Congressional
Budget Act of 1974 are suspended; and
(3) sections 1105(f) and 1103 of title 31, United States
Code, are suspended.
(b) Peace.--In the event of a suspension of sequestration
procedures due to a declaration of war, then, effective with the first
fiscal year that begins in the session after the state of war is
concluded by Senate ratification of the necessary treaties, the
provisions of subsection (a) triggered by that declaration of war are
no longer effective. The provisions of this Act that would have applied
to the fiscal year that started in the calendar year in which the
declaration of war was enacted shall instead apply to the first fiscal
year that begins in the session after the state of was is concluded.
The preceding sentence shall apply in the same manner to each
succeeding fiscal year. If the implementation of this subsection
requires adding entries to the direct spending and receipts scorecard
under section 106, CBO and OMB shall submit estimates of those entries
as part of their next sequestration preview report under section 114.
(c) Low Growth.--
(1) Trigger.--Within 20 days after the Board issues a low-
growth report under section 114(k), the majority leader of the
House of Representatives may, and the majority leader of the
Senate shall, introduce a joint resolution in the form set
forth in paragraph (2).
(2) Form of joint resolution.--
(A) The matter after the resolving clause in any
joint resolution introduced pursuant to paragraph (1)
shall be as follows: ``That the conditions specified in
section 114(k) of the Deficit Elimination Act of 1993
are met. The implementation of the Congressional Budget
Act of 1974, chapter 11 of title 31, United States
Code, and the Deficit Elimination Act of 1993 are
modified as follows:
(1) the subsequent issuance of any
sequestration report or any sequestration order
is precluded;
(2) sections 302(f), 310(d), and 311 of the
Congressional Budget Act of 1974 are suspended;
and
(3) sections 1105(f) and 1103 of title 31,
United States Code, are suspended.
The provisions of this joint resolution shall cease to
be effective with respect to the first fiscal year
beginning at least 12 months after its enactment.''.
(B) The title of the joint resolution shall be
``Joint resolution modifying certain provisions of law
pursuant to section 118(c) of the Deficit Elimination
Act of 1993.''; and the joint resolution shall not
contain any preamble.
(3) Committee action.--Each joint resolution introduced
pursuant to paragraph (1) shall be referred to the Committees
on Rules, Government Operations, and Budget of the House of
Representatives or to the Committee on the Budget of the
Senate, as the case may be.
(4) Senate budget comittee consideration.--The Committee on
the Budget of the Senate shall report the joint resolution with
or without amendment on or before the 20th day after the date
on which the joint resolution is introduced. If any committee
fails to report the joint resolution within that 20-day period,
it shall be automatically discharged from further consideration
of the joint resolution, and the joint resolution shall be
placed on the appropriate calendar.
(5) Committee amendments.--Amendments reported by any
committee under paragraph (3) shall only strike the second and
third sentences of the joint resolution as introduced and
insert matter providing--
(A) changes to the budget targets or dates under
sections 101 through 104 to allow higher discretionary
funding limits or lower direct spending and receipts
deficit reduction requirements for any fiscal year or
years;
(B) conforming amendments that may be needed to
chapter 11 of title 31, United States Code; and
(C) conforming amendments that may be needed to the
Congressional Budget Act of 1974 or the rules of the
House of Representatives or the Senate.
(6) Consideration of joint resolution.--
(A) A vote on final passage of a joint resolution
reported to the Senate or discharged pursuant to
paragraph (3) shall be taken on or before the close of
the 10th calendar day of session after the date on
which the joint resolution is reported or after the
Committee has been discharged from further
consideration of the joint resolution.
(B)(i) In the Senate, a joint resolution under this
paragraph shall be privileged. It shall not be in order
to move to reconsider the vote by which the motion is
agreed to or disagreed to.
(ii) Debate in the Senate on a joint resolution
under this paragraph, and all debatable motions and
appeals in connection therewith, shall be limited to
not more than five hours. The time shall be equally
divided between, and controlled by, the majority leader
and the minority leader or their designees.
(iii) Debate in the Senate on any debatable motion
or appeal in connection with a joint resolution under
this paragraph shall be limited to not more than one
hour, to be equally divided between, and controlled by,
the mover and the manager of the joint resolution,
except that in the event the manager of the joint
resolution is in favor of any such motion or appeal,
the time in opposition thereto shall be controlled by
the minority leader or his designee.
(iv) A motion in the Senate to further limit debate
on a joint resolution under this paragraph is not
debatable. A motion to table or to recommit a joint
resolution under this paragraph is not in order.
(C) If, after a joint resolution has been reported
to one House and prior to its passage by that House, an
identical joint resolution is received from the other
House, then--
(i) the procedure in that House shall be
the same as if no such joint resolution had
been received from the other House, but
(ii) the vote on final passage shall be on
the joint resolution of the other House, and
when the joint resolution is agreed to, the Clerk of
the House of Representatives (in the case of a House
joint resolution agreed to in the House of
Representatives) or the Secretary of the Senate (in the
case of a Senate joint resolution agreed to in the
Senate) shall cause the joint resolution to be
engrossed, certified, and transmitted to the other
House of the Congress as soon as practicable.
(D) Amendments to a joint resolution considered
under this paragraph shall be in order in the Senate
only if germane to that resolution in the form in which
it was reported or discharged.
(7) Consideration of a conference report.--Consideration of
a conference report on a joint resolution under this subsection
shall be governed by the Standing Rules of the Senate, and by
provisions of paragraph (5)(a) and (B) as if those provisions
applied to conference reports.
SEC. 119. BOARD OF ESTIMATES.
(a) Establishment.--There is established a Board of Estimates.
(b) Duties of the Board.--(1) On the dates specified in section
114, the Board shall issue a report to the President and the Congress
which states whether it has chosen (with no modification)--
(A) the sequestration preview report for the budget year
submitted by OMB under section 114(d) or the report for that
year submitted by CBO under section 114(d); and
(B) the final sequestration report for the budget year
submitted by OMB under section 114(h) or the report for that
year submitted by CBO under section 114(h);
that shall be used for purposes of this Act, chapter 11 of title 31,
United States Code, and section 403 of the Congressional Budget Act of
1974. In making its choice, the Board shall choose the report that, in
its opinion, is the more accurate.
(2) At any time the Board may change the list of major estimating
assumptions to be used by OMB and CBO in preparing their sequestration
preview reports.
(3) At any time the Board may approve a revision to the list of the
direct spending jurisdiction of the standing committees of the House of
Representatives to be used for implementing targeted sequestration
under section 108. Each such revision must be requested in writing by
the Speaker of the House of Representatives and may be approved or
disapproved, but may not be modified.
(c) Membership.--
(1) Number and appointment.--The Board shall be composed of
5 members, the chairman of the Board of Governors of the
Federal Reserve System and 4 other members to be appointed by
the President as follows:
(A) One from a list of at least 5 individuals
nominated for such appointment by the Speaker of the
House of Representatives.
(B) One from a list of at least 5 individuals
nominated for such appointment by the majority leader
of the Senate.
(C) One from a list of at least 5 individuals
nominated for such appointment by the minority leader
of the House of Representatives.
(D) One from a list of at least 5 individuals
nominated for such appointment by the minority leader
of the Senate.
No member appointed by the President may be an officer or
employee of any government. A vacancy in the Board shall be
filled in the manner in which the original appointment was
made.
(2) Continuation of membership.--If any member of the Board
appointed by the President becomes an officer or employee of a
government, he may continue as a member of the Board for not
longer than the 30-day period beginning on the date he becomes
such an officer or employee.
(3) Terms.--(A) Members shall be appointed for terms of 4
years.
(B) Any member appointed to fill a vacancy occurring before
the expiration of the term for which his predecessor was
appointed shall be appointed only for the remainder of such
term. A member may serve after the expiration of his term until
his successor has taken office.
(4) Basic pay.--Members of the Board shall serve without
pay.
(5) Quorum.--Three members of the Board shall constitute a
quorum but a lesser number may hold hearings.
(6) Chairman.--The Chairman of the Board shall be chosen
annually by its members.
(7) Meetings.--The Board shall meet at the call of the
Chairman or a majority of its members.
(d) Director and Staff.--
(1) Appointment.--The Board shall have a Director who shall
be appointed by the members of the Board. Subject to such rules
as may be prescribed by the Board, the Director may appoint and
fix the pay of such personnel as the Director considers
appropriate.
(2) Applicability of certain civil service laws.--The
Director and staff of the Board may be appointed without regard
to the provisions of title 5, United States Code, governing
appointments in the competitive service, and may be paid
without regard to the provisions of chapter 51 and subchapter
III of chapter 53 of such title relating to classification and
General Schedule pay rates, except that no individual so
appointed may receive pay in excess of the annual rate of basic
pay payable for GS-18 of the General Schedule.
(3) Staff of federal agencies.--Upon request of the Board,
the head of any Federal agency is authorized to detail, on a
reimbursable basis, any of the personnel of such agency to the
Board to assist the Board in carrying out its duties,
notwithstanding section 202(a) of the Legislative
Reorganization Act of 1946 (2 U.S.C. 72a(a)).
(e) Powers.--
(1) Hearings and sessions.--The Board may, for the purpose
of carrying out its duties, hold such hearings, sit and act at
such times and places, take such testimony, and receive such
evidence, as it considers appropriate.
(2) Obtaining official data.--The Board may secure directly
from any department or agency of the United States information
necessary to enable it to carry out its duties. Upon request of
the Chairman of the Board, the head of such department or
agency shall furnish such information to the Board.
(3) Administrative support services.--The Administrator of
General Services shall provide to the Board on a reimbursable
basis such administrative support services as the Board may
request.
SEC. 120. JUDICIAL REVIEW.
(a) Expedited Review.--
(1) Any Member of Congress may bring an action, in the
United States District Court for the District of Columbia, for
declaratory judgment and injunctive relief on the ground that
any order that might be issued pursuant to section 114 violates
the Constitution.
(2) Any Member of Congress, or any other person adversely
affected by any action taken under this title, may bring an
action, in the United States District Court for the District of
Columbia, for declaratory judgment and injunctive relief
concerning the constitutionality of this title.
(3) Any Member of Congress may bring an action, in the
United States District Court for the District of Columbia, for
declaratory and injunctive relief on the ground that the terms
of an order issued under section 114 do not comply with the
requirements of this title.
(4) A copy of any complaint in an action brought under
paragraph (1), (2), or (3) shall be promptly delivered to the
Secretary of the Senate and the Clerk of the House of
Representatives, and each House of Congress shall have the
right to intervene in such action.
(5) Any action brought under paragraph (1), (2), or (3)
shall be heard and determined by a three-judge court in
accordance with section 2284 of title 28, United States Code.
Nothing in this section or in any other law shall infringe upon the
right of the House of Representatives to intervene in an action brought
under paragraph (1), (2), or (3) without the necessity of adopting a
resolution to authorize such intervention.
(b) Appeal to Supreme Court.--Notwithstanding any other provision
of law, any order of the United States District Court for the District
of Columbia which is issued pursuant to an action brought under
paragraph (1), (2), or (3) of subsection (a) shall be reviewable by
appeal directly to the Supreme Court of the United States. Any such
appeal shall be taken by a notice of appeal filed within 10 days after
such order is entered; and the jurisdictional statement shall be filed
within 30 days after such order is entered. No stay of an order issued
pursuant to an action brought under paragraph (1), (2), or (3) of
subsection (a) shall be issued by a single Justice of the Supreme
Court.
(c) Expedited Consideration.--It shall be the duty of the District
Court for the District of Columbia and the Supreme Court of the United
States to advance on the docket and to expedite to the greatest
possible extent the disposition of any matter brought under subsection
(a).
(d) Noncompliance With Sequestration Procedures.--
(1) If it is finally determined by a court of competent
jurisdiction that an order issued by the President under
section 114 for any fiscal year does not fully implement
without change all sequestrations required by the appropriate
Office of Management and Budget or Congressional Budget Office
report chosen by the Board to be the basis for the order, the
President shall, within 20 days after such determination is
made, revise the order in accordance with such determination.
(2) If the order issued by the President under section 114
for any fiscal year does not fully implement without change all
sequestrations required by the appropriate OMB or CBO report
chosen by the Board to be the basis for the order on the claim
or defense that the constitutional powers of the President
prevent such sequestration or reduction or permit the avoidance
of such sequestration or reduction, and such claim or defense
is finally determined by the Supreme Court of the United States
to be valid, then the entire order issued pursuant to section
114 for such fiscal year shall be null and void.
(e) Timing of Relief.--No order of any court granting declaratory
or injunctive relief from the order of the President issued under
section 114, including relief permitting or requiring the expenditure
of funds sequestered by such order, shall take effect during the
pendency of the action before such court, during the time appeal may be
taken, or, if appeal is taken, during the period before the court to
which such appeal is taken has entered its final order disposing of
such action.
(f) Alternative Procedures.--(1) If any order is invalidated
because of the manner of appointment of members of the Board, then
section 120(c)(1) is amended to read as follows:
``(1) Number and Appointment.--The Board shall be composed of 5
members, the Chairman of the Board of Governors of the Federal Reserve
System and 4 other members to be appointed by the President. No member
appointed by the President may be an officer or employee of any
government.'';
and any reports upon which such order was based shall be transmitted to
the newly constituted Board.
(2) No later than 5 days after the receipt of the reports, the
Board shall choose the report upon which the order is to be based.
(3) This report shall be deemed to be the report received by the
President under section 114.
(g) Preservation of Other Rights.--The rights created by this
section are in addition to the rights of any person under law, subject
to subsection (e).
(h) Economic Data, Assumptions, and Methodologies.--The economic
data and economic and technical assumptions and estimation of
methodologies used by OMB or CBO in preparing any report issued under
section 114 shall not be subject to review in any judicial or
administrative proceeding, and any choice made by the Board under
section 114 shall not be subject to any such review.
TITLE II--TECHNICAL AND CONFORMING AMENDMENTS
SEC. 201. AMENDMENTS TO THE CONGRESSIONAL BUDGET AND IMPOUNDMENT
CONTROL ACT OF 1974.
(a) Repealer.--Paragraph (2) of section 3 of the Congressional
Budget and Impoundment Control Act of 1974, the first time it appears,
is repealed.
(b) Definition of Budget Authority.--Paragraph (2) of section 3 of
the Congressional Budget and Impoundment Control Act of 1974, the
second time it appears, is amended by inserting ``in any form'' after
``promissory notes'', by inserting at the end of subparagraph (A) the
following new sentence: ``Such term excludes transactions classified as
means of financing.'', and by striking ``With respect to'' and all that
follows through ``retirement account, any'' and inserting ``Any'', by
inserting after subparagraph (B) the following:
``(C) Relationship to entitlement authority.--For
purposes of titles III and IV, all references to budget
authority shall be considered to include the amount of
budget authority estimated to be needed to fund
entitlement provisions under existing or proposed law,
and all legislation increasing (or decreasing) the
level of entitlement authority under existing law shall
be considered to provide (or decrease) new budget
authority in that amount.'',
and by redesignating the next subparagraph accordingly.
(c) Definition of Entitlement Authority.--Paragraph (9) of section
3 of the Congressional Budget and Impoundment Control Act of 1974 is
amended by striking ``spending authority described by section
401(c)(2)(C)'' and inserting the following: ``, and the term
`entitlement program' refers to, any provision of law that has the
effect of requiring the Government to make net payments (including
intragovernmental payments) regardless of the amount of budget
authority that may be available to make those payments. Those terms
shall include amounts estimated to be required under provisions of law
that depend on the fulfillment of non-legislative conditions or are
indefinite as to amount or timing. Except as provided in the next
sentence, if a provision of law that otherwise requires the Government
to make net payments is directly or indirectly limited by any other
provision of law to an amount of available budget authority, then
entitlement authority does not exist. Subchapter II of chapter 13 of
title 31, United States Code, and the sequestration provisions of the
Deficit Elimination Act of 1993 shall not be considered provisions of
law that limit entitlement authority to the amount of available budget
authority.''
(d) Definition of Means of Financing.--Section 3 of the
Congressional Budget and Impoundment Control Act of 1974 is amended by
adding at the end the following new paragraph:
``(11) The term `means of financing' means the financial
transactions of the Government that consist of exchanges of
money or monetary proxies of equal value and therefore are not
counted as obligations, outlays, or revenues, such as net
Federal borrowing from the public in any form, debt redemption,
seignorage on coins and profits from the sale of gold, and
changes in outstanding check or other monetary credits,
including write-offs.''.
(e) CBO Studies.--Section 202(h) of the Congressional Budget Act of
1974 is amended by striking ``outlays, credit authority,'' and
inserting ``outlays''.
(f) Timetable.--Section 300 of the Congressional Budget Act of 1974
is amended by striking ``February 25'' and inserting ``Six weeks after
the President's budget submission''.
(g) Required Contents of Budget Resolution.--Section 301(a) of the
Congressional Budget Act of 1974 is amended by striking ``planning
levels'', by striking ``two'' and inserting ``four'', by striking ``,
budget outlays, direct loan obligations, and primary loan guarantee
commitments'' both places it appears and inserting ``and outlays'', by
striking paragraphs (5), (6) and (7), by striking the semicolon at the
end of paragraph (4) and inserting a period, by inserting ``and'' after
the semicolon at the end of paragraph (3), and by striking the last
sentence.
(h) Delayed Enrollment.--Section 301(b)(3) of the Congressional
Budget Act of 1974 is amended by striking ``or new entitlement
authority''.
(i) Spin-Off Bill.--(1) Paragraphs (5), (6), (7), and (8) of
section 301(b) of the Congressional Budget Act of 1974 are amended to
read as follows:
``(5) set forth in a separate section--
``(A) the appropriate level of the debt held by the
public;
``(B) the discretionary funding limit for the
fiscal year, but only if and to the extent required by
section 103 or 104 of the Deficit Elimination Act of
1993;
``(C) the amount of direct spending change required
of or allowed by each committee of the House of
Representatives in laws within that committee's
jurisdiction and the amount of receipts change required
of or allowed by the Committee on Ways and Means of the
House of Representatives in laws within that
committee's jurisdiction, but only to the extent
specified in section 105 of that Act; and
``(D) the amount, if any, to be withdrawn from the
Stabilization Reserve Fund and paid to the General Fund
of the Treasury during the fiscal year under section
117 of that Act.''.
(2) Paragraph (4) of section 301(b) of the Congressional Budget Act
of 1974 is amended by inserting ``and'' after the semicolon.
(j) Technical Correction to Section 301(e).--Section 301(e) of the
Congressional Budget Act of 1974 is amended by inserting ``new'' before
``budget authority'' in the second sentence.
(k) Section 301(i) Point of Order.--Section 301(i) of the
Congressional Budget Act of 1974 is amended to read as follows:
``(i) It shall not be in order in the House of Representatives or
the Senate to consider any concurrent resolution on the budget for a
fiscal year beginning on October 1 of the year in which the resolution
is considered (or amendment to, motion regarding, or conference report
on such a resolution) unless--
``(1) it does not exceed the discretionary funding limit,
and
``(2) it fully meets the direct spending and receipts
deficit reduction requirement,
for that fiscal year under sections 101 through 104 of the Deficit
Elimination Act of 1993, using estimates of that limit and that
requirement chosen by the Board of Estimates.''.
(l) Committee Allocations and Suballocations.--Section 602 of the
Congressional Budget Act of 1974 is amended--
(1) by striking ``of--'' and all that follows through
``outlays;'' both places it appears and inserting ``of total
new budget authority and outlays'';
(2) in subsection (a)(1)(B), by striking ``committee.'' and
inserting ``committee, except that new budget authority and
outlays for entitlement programs funded through annual
appropriations shall be allocated and scored both to the
Committee on Appropriations and to the committee that
authorized such programs.''; and
(3) in subsection (a)(3), by striking ``, entitlement
authority,'' both times it appears and by striking ``, outlays,
or social security outlays'' both times it appears and
inserting ``or outlays''.
(m) Redesignation of Committee Allocations.--Subsections (a) and
(b) of section 302 of the Congressional Budget Act of 1974 are repealed
and subsections (a) and (b) of section 602 of that Act (as amended by
subsection (g)) are redesignated as subsections (a) and (b) of section
302, respectively.
(n) Consideration of Appropriation Bills.--Section 302(c) of the
Congressional Budget Act of 1974 is amended by striking ``--(1)'' and
everything that follows through ``401(c)(2) for a fiscal year;'' and
inserting ``new budget authority for a fiscal year''.
(o) Points of Order Under Section 302(f).--(1) Section 302(f)(1) of
the Congressional Budget Act of 1974 is amended to read as follows:
``(1) In the house of representatives.--It shall not be in
order in the House of Representatives to consider any bill,
joint resolution, or amendment providing new budget authority,
or any conference report on any such bill or joint resolution,
if--
``(A) the enactment of the bill or resolution as
reported or in the form recommended in the conference
report, or
``(B) the adoption of the amendment,
when added to existing levels of new budget authority, would
cause the level of new budget authority for the fiscal year
starting in the year in which the most recent concurrent
resolution on the budget was agreed to, or for the sum of that
fiscal year and the next 4 fiscal years, to exceed an
allocation to a committee made under subsection (a) for either
period, or to exceed a suballocation made under subsection (b)
for that fiscal year.''.
(2) Section 302(f)(2) of that Act is amended--
(A) in the first sentence, by striking ``for budget
outlays,'', by striking ``new budget authority, or new spending
authority (as defined in section 401(c)(2))'' and inserting
``new budget authority'', by striking ``outlays or'' both
places it appears, and by striking ``or provides for social
security outlays in excess of the appropriate allocation of
social security outlays under subsection (a)''; and
(B) by striking the third sentence.
(3) Section 302(g) of that Act is amended by striking ``budget
authority'' and all that follows through ``credit authority'' and
inserting ``budget authority and outlays''.
(p) Section 303.--Section 303 of the Congressional Budget Act of
1974 is amended--
(1) in its title by striking ``, New Spending Authority,
New Credit Authority,'';
(2) in subsection (a) by striking ``either the House of
Representatives or'', by inserting ``or'' at the end of
paragraph (2), by striking ``paragraphs (4), (5), and (6), and
after paragraph (6) by striking ``for'' and inserting
``covering'' and by striking ``(or, in the Senate, a concurrent
resolution on the budget covering such fiscal year)'';
(3) in subsection (b) by repealing paragraph (1) and by
striking ``(2)''; and
(4) by adding at the end the following new subsection:
``(d) Point of Order in the House of Representatives.--It shall not
be in order in the House of Representatives to consider any bill, joint
resolution, amendment, or conference report if that legislation, as
reported, includes any provision--
``(1) providing new budget authority;
``(2) reducing the level of revenues; or
``(3) altering the limit on the debt held by the public;
that is first effective in the last fiscal year covered by the most
recently agreed to concurrent resolution on the budget or any
subsequent fiscal year.''.
(q) Consideration of Spin-off Legislation.--Section 305 of the
Congressional Budget Act of 1974 is amended by adding at the end the
following new subsection:
``(e) Conference Reports.--Conference reports on concurrent
resolutions on the budget that contain additional matter under section
301(b)(5) shall be considered first in the House of Representatives.''.
(r) Cost Estimates and Scorekeeping Reports.--Section 308 of the
Congressional Budget Act of 1974 is amended--
(1) in its title, by striking ``, new spending authority,
or new credit authority,'';
(2) by striking ``, new spending authority described in
section 401(c)(2), or new credit authority,'' the 3 times it
appears;
(3) in subsection (a), by striking ``in the reports
submitted'', by inserting ``302(a) or'' before ``302(b)'', in
paragraph (1)(B) by striking ``spending authority'' and
everything that follows through ``401(c)(2) which is'' and
inserting ``budget authority'' and by striking ``annual
appropriations'' and inserting ``annual discretionary
appropriations'', and in paragraph (1)(C) by striking ``such
budget authority'' and all that follows through ``loan
guarantee commitments'' and inserting ``new budget authority,
outlays, or revenues''; and
(4) in subsection (c), by adding ``and'' at the end of
paragraph (1), by striking ``period;'' and inserting
``period.'' at the end of paragraph (2), and by striking
paragraphs (3), (4), and (5).
(s) Reconciliation.--Section 310 of the Congressional Budget Act of
1974 is amended--
(1) in subsection (a), by striking ``which--(A)'' and all
that follows through ``fiscal year, contained in'' and
inserting the following: ``which outlays resulting from'' and
by striking ``jurisdiction of a committee is'' and inserting
``jurisdiction of a committee other than the Committee on
Appropriations of either House are'';
(2) by repealing subsection (c) and inserting the following
new subsection:
``(c) Inclusion of Spin-off Bill in Reconciliation Legislation.--
Reconciliation legislation may include a separate title to be inserted
by the Committee on the Budget consisting of a spin-off bill
(containing the matter described in section 301(b)(5)), if such bill
has not been enacted for the first fiscal year covered by that
legislation. The targets for each category contained in this title
shall be identical to the reconciliation directive contained in the
most recently agreed to concurrent resolution on the budget.'';
(3) in subsection (d)(1), by striking ``or new entitlement
authority''; and
(4) by repealing subsection (g).
(t) Revision of Section 311.--(1) Section 311 of the Congressional
Budget Act of 1974 is amended to read as follows:
``enforcing the revenue floor
``Sec. 311. (a) Point of Order.--It shall not be in order in either
the House of Representatives or the Senate to consider any bill, joint
resolution, amendment, motion, or conference report if, as proposed to
be adopted and when added to existing revenue levels, it would cause
the level of revenues for the fiscal year starting in the year in which
the most recent concurrent resolution on the budget was agreed to, or
for the sum of that fiscal year and the 4 succeeding fiscal years, to
be lower than the appropriate level of revenues for either period set
forth in that concurrent resolution.
``(b) Determination of Revenue Levels.--For purposes of this
section, the levels of revenues for a fiscal year shall be determined
on the basis of estimates made by the Committee on the Budget of the
House of Representatives or of the Senate, as the case may be.''.
(2) Conforming Amendment.--The item relating to section 311 in the
table of contents set forth in section 1(b) is amended to read as
follows:
``Sec. 311. Enforcing the revenue floor.''.
(u) Technical Correction to Section 312.--Section 312 of the
Congressional Budget Act of 1974 is amended by inserting ``(a)'' after
``312.''.
(v) Consideration of Legislation That Has Not Been Reported.--
Section 312 of the Congressional Budget Act of 1974 is amended by
inserting at the end the following:
``(c) Consideration of Legislation That Has Not Been Reported.--In
the House of Representatives, any point of order under title III or IV
that would lie against consideration of a bill or joint resolution as
reported by a committee shall also lie against a motion to consider
legislation respecting which no report has been filed.''
(w) Conforming Amendments to Section 313.--Section 313 of the
Congressional Budget Act of 1974 is amended by striking ``or section
258C'' and everything that follows through ``Deficit Control Act of
1985'', by striking ``; and (F)'' and everything that follows through
``310(g)'', by redesignating the second subsection (c) and subsection
(d) as subsections (d) and (e), respectively, and by striking ``or
(b)(1)(F),''.
(x) Borrowing and Contract Authority.--Section 401 of the
Congressional Budget Act of 1974 is amended
(1) in subsection (a), by striking ``new spending authority
described in subsection (c)(2)(A) or (B)'' both times it
appears and inserting ``borrowing authority or contract
authority'';
(2) by repealing subsections (b) and (c) and by
redesignating subsection (d) as subsection (b); and
(3) in subsection (b) (as redesignated), by striking
``Subsections (a) and (b)'' and inserting ``Subsection (a)'',
by inserting ``non-interest'' before ``receipts'' in paragraph
(1)(B), by repealing paragraph (2), and by redesignating
paragraph (3) as paragraph (2).
(y) Credit Authority.--Section 402(a) of the Congressional Budget
Act of 1974 is amended by inserting before the period the following:
``, except that this provision shall not apply with respect to programs
that, as of August 15, 1992, provide credit authority as an
entitlement''.
(z) Costs of Federal Mandates; Conforming Change to Section 403.--
Section 403 of the Congressional Budget Act of 1974 is amended
(1) by adding at the end the following new subsection:
``(d) In fulfilling the requirements of subsection (a)(2), the
Director shall place special emphasis on costs imposed on State or
local governments by the enactment or expansion of Federal mandates,
and shall estimate both the costs of those mandates and the degree, if
any, to which Federal financing is provided to State or local
governments to cover those costs.''; and
(2) in subsection (a), by striking ``of a public
character''.
(aa) Conforming Change to Section 405.--Section 405 of the
Congressional Budget Act of 1974 is amended by striking ``spending
authority'' and all that follows through ``permanent appropriations''
and inserting ``new budget authority (other than through appropriations
Acts) or entitlement authority''.
(bb) Off-Budget Agencies.--Section 406(a) of the Congressional
Budget Act of 1974 is amended by striking ``credit authority, and
estimates of outlays'' and inserting ``outlays,'', by striking ``the
date of enactment'' and all that follows through ``Trust Funds,'' and
inserting ``August 15, 1992,'', and by striking ``, outlays, and
spending authority'' and inserting ``and outlays''.
(cc) Repeal of Title VI.--Title VI of the Congressional Budget Act
of 1974 is repealed.
SEC. 202. AMENDMENTS TO THE FEDERAL CREDIT REFORM ACT OF 1990.
(a) Deferred Cost Sharing.--The second sentence of section 502(1)
of the Congressional Budget Act of 1974 is amended by inserting before
the period the following: , and Federal payments for the construction
of a Federal project to the extent those payments must, by law or
contract, be repaid to the Government''.
(b) Loan Modifications.--Section 502(5) of the Congressional Budget
Act of 1974 is amended--
(1) in subparagraph (A), by inserting ``or a modification
thereof'' after ``guarantee'';
(2) in subparagraph (B), by striking `recoveries.'' and
inserting ``recoveries, and routine work-outs of loans in
imminent danger of default when those work-outs are to maximize
repayments to the Government.'';
(3) in subparagraph (C), by striking ``and'' at the end of
clause (i), by striking the period at the end of clause (ii)
and inserting a comma, and by adding at the end the following:
``(iii) routine work-outs of loans in imminent
danger of default when those work-outs are to minimize
claims against the Government.''; and
(4) by striking subparagraph (D) and inserting the
following new subparagraph:
``(D) The cost of a modification of a direct loan, a direct
loan obligation, a loan guarantee, or a loan guarantee
commitment shall be the net present value, at the time of the
modification, of the change in cash flows estimated to occur as
a result of that modification. OMB shall measure that change in
relation to the current policy baseline in the most recent
budget under section 1105(a) of title 31, United States Code. A
modification may result either from the enactment of
legislation that directly or indirectly alters the expected
cash flows, or from the exercise of administrative discretion
under existing law, and includes the sale (with or without
recourse) of loan assets by the Government. Modifications do
not include changes in loan terms resulting from the exercise
by the borrower of an option included in the loan contract.''.
(c) Credit Reform Act Clarification.--Section 504 of the
Congressional Budget Act of 1974 is amended--
(1) in subsection (b)(1), by striking ``appropriations of''
and inserting ``new'', by striking ``are made'' and inserting
``is provided'', and by inserting ``in appropriation Acts''
before the semicolon;
(2) in subsection (b)(2), by striking ``enacted'' and
inserting ``provided in an appropriation Act'';
(3) in subsection (d)(1) by striking ``costs of outstanding
direct loans and loan guarantees'' and inserting ``costs of
outstanding direct loans (or direct loan obligations) or loan
guarantees (or loan guarantee commitments)''; and
(4) in subsection (e), by striking ``A direct loan'' and
all that follows through ``comitment'' and inserting ``An
outstanding direct loan (or direct loan obligation) or loan
guarantee (or loan guarantee commitment)''.
(d) Credit Reform Act Correction.--(1) Section 506 of the
Congressional Budget Act of 1974 is repealed.
(2) Section 507 of the Congressional Budget Act of 1974 is
redesignated as section 506, and the table of contents in section 1(b)
of the Congressional Budget and Impoundment Control Act of 1974 is
amended by striking the item relating to section 506 and striking
``Sec. 507.'' and inserting ``Sec. 506.''.
(e) Existing Rights Not Impaired.--Section 506 of the Congressional
Budget Act of 1974 (as redesignated) is amended by striking ``title.
Nothing'' and inserting ``title, except that nothing'' and by inserting
after ``construed'' the following ``(1) to alter the terms or
conditions authorized to be included in loan or guarantee contracts or
the rights and responsibilities of the government and the recipients of
loans or guarantees under those contracts or the laws that authorize
them, or (2)''.
(f) Credit Reform Liquidating Accounts.--(1) Section 502(8) of the
Congressional Budget Act of 1974 is amended by striking ``budget
account'' and inserting ``nonbudget account'' and by striking the last
sentence and inserting ``Transactions between the Treasury or the
Federal Financing Bank and any liquidating account shall be considered
non-budgetary.''..
(2) Section 505(d) of the Congressional Budget Act of 1974 is
amended by striking ``If funds'' and all that follows through
``accounts, there'' and inserting ``There'' and by striking ``such
obligations and commitments'' and inserting ``the obligations and
commitments of liquidating accounts''.
(3) Section 506(b) of the Congressional Budget Act of 1974 (as
redesignated) is amended by striking ``be available, to'' and all that
follows through the end of that section, and inserting ``immediately be
transferred to the Federal Financing Bank to repay those debt
obligations held by the Bank that were created to finance the loan
being repaid, and all amounts not transferred to the Bank shall
immediately be paid to the general fund of the Treasury. All debt owed
to the Treasury as a result of agency borrowing authority used before
October 1, 1991, for loans or guarantees is hereby cancelled. The
provisions of this subsection shall not diminish any rights or
responsibilities guaranteed by subsection (a).''.
SEC. 203. AMENDMENTS TO THE RULES OF THE HOUSE OF REPRESENTATIVES.
(a) Budget Committee Jurisdiction.--Clause 1(e)(2) of rule X of the
Rules of the House of Representatives is amended by inserting ``(A)''
after ``(2)'' and by inserting at the end the following:
``(B) Budget targets contained in any joint resolution described in
section 118 of the Deficit Elimination Act of 1993 (relating to low
growth).''.
(b) Miscellaneous Conforming Amendments.--Clause 4 of rule X of the
Rules of the House of Representatives is amended--
(1) by repealing subparagraph (2) of paragraph (a) and by
redesignating subparagraph (3) as subparagraph (2);
(2) in paragraph (g), by striking ``February 25 of each
year'' and inserting ``within 6 weeks after the President's
budget submission''; and
(3) in paragraph (h), by striking ``or section 602 (in the
case of fiscal years 1991 through 1995)''.
(c) Emergency Designations.--Clause 2(b) of rule XXI of the Rules
of the House of Representatives is amended by striking ``and'' and by
inserting before the period the following: ``, and except emergency
designations under section 102(b)(4) of the Deficit Elimination Act of
1993''.
(d) Repealer.--Clause 8 of rule XXI of the Rules of the House of
Representatives is repealed.
(e) Spin-Off Legislation.--Rule XLIX of the Rules of the House of
Representatives is amended--
(1) by changing the name of that rule to ``Enactment of
Spin-Off Legislation under the Congressional Budget Act'';
(2) in clause 2 by striking ``section 301, 304, or 310''
and inserting ``section 301 or 304'';
(3) in clause 1 by striking ``adoption by the Congress''
and all that follows through ``for such period'' and inserting
``passage by the House of Representatives (under section 301 or
304 of the Congressional Budget Act of 1974) of a conference
report or final agreement on any concurrent resolution on the
budget containing any matter under section 301(b)(5) of that
Act'';
(4) in clause 1 by striking ``, increasing or decreasing
the statutory limit on the public debt'';
(5) in the last sentence of clause 1 by inserting ``at the
same time the engrossed copy of the concurrent resolution on
the budget is transmitted to the Senate'' after ``transmitted
to the Senate for further legislative action'';
(6) in the first sentence of clause 2 by striking ``be as
follows'' and all that follows through the period and inserting
the following: ``be the text of the section in the concurrent
resolution on the budget included under section 301(b)(5) of
the Congressional Budget Act of 1974, without change.'', and in
the second sentence by striking ``budget;'' and all that
follows through the period and inserting ``budget.''; and
(7) in clause 3 by striking ``301(d)'' and inserting
``301(e)'', and by striking ``upon the statutory limit on the
public debt''.
SEC. 204. AMENDMENTS TO THE STANDING RULES OF THE SENATE.
The Standing Rules of the Senate are amended by adding at the end
the following:
``Rule ----
``spin-off legislation
``Upon passage of a conference report on any concurrent resolution
on the budget containing additional matter under section 301(b)(5) of
the Congressional Budget Act of 1974, the joint resolution passed by
the House of Representatives under rule XLIX of the Rules of the House
of Representatives shall be deemed to have been passed by the Senate,
and shall be prepared for transmittal to the President under the
applicable rules of the Senate and the House of Representatives. The
vote by which the conference report on the concurrent resolution on the
budget was agreed to in the Senate shall be deemed to have been a vote
in favor of such joint resolution upon final passage in the Senate.''.
SEC. 205. PRESIDENT'S BUDGET AND SUPPLEMENTAL BUDGET ESTIMATES.
(a) Definitions.--Section 1101 of title 31, United States Code, is
amended by adding at the end the following:
``(3) `Expenditures' has the same meaning as the term
`outlays' in the Deficit Elimination Act of 1993.
``(4) All other terms used herein or in the documents
prepared hereunder shall have the meanings set forth in the
Deficit Elimination Act of 1993.''.
(b) Byrd Amendment.--Section 1103 of title 31, United States Code,
is amended by striking ``commitment that budget'' and inserting
``commitment that, starting with fiscal year 1998,''.
(c) President's Budget Submission.--Section 1105(a) of title 31,
United States Code, is amended--
(1) in the first sentence by striking ``On or after the
first Monday in January but not later than the first Monday in
February of each year'' and inserting ``On or before the first
Monday in February or the 21st calendar day beginning after the
date the Board of Estimates issues a report to the President
under section 114 of the Deficit Elimination Act of 1993'';
(2) in paragraph (15) by striking ``section 301(a)(1)-(5)''
and inserting ``section 301(a)(1)-(4);
(3) in paragraph (16) by striking ``section 3(a)(3)'' and
inserting ``section 3(3)''; and
(4) by adding at the end the following new paragraph:
``(29) an analysis of the financial condition of
Government-sponsored enterprises and the financial exposure of
the Government, if any, posed by them.''.
(d) Use of Official Estimates.--Section 1105(f) of title 31, United
States Code, is amended by striking ``Balanced Budget and Emergency
Deficit Control Act of 1985'' and inserting ``Deficit Elimination Act
of 1993'' and by inserting at the end the following new sentence:
``That budget shall be consistent with the discretionary funding limit
and the direct spending and receipts deficit reduction requirement for
that year chosen by the Board of Estimates and shall be based upon the
major estimating assumptions chosen by that Board.''.
(e) Midsession Review.--Section 1106(a) of title 31, United States
Code, is amended by striking ``July 16 of each year'' and inserting
``August 30 of each year'' and by striking ``submitted before July
16''.
(f) Current Policy Baseline.--(1) The first sentence of section
1109 of title 31, United States Code, is amended to read as follows:
``In the budget submitted under section 1105(a) or 1106(a), the
President shall include a current policy baseline (as defined in
section 116 of the Deficit Elimination Act of 1993) for the current
year, the budget year, and the outyears, including a detailed
comparison of that baseline with his proposed budget for those
years.''.
(2) Subsection (b) of that section 1109 is amended to read as
follows:
``(b) The baseline referred to in subsection (a) shall be
calculated using the major estimating assumptions chosen by the Board
of Estimates under section 114 of the Deficit Elimination Act of
1993.''.
(g) Glossary of Terms.--Section 1112(c) of title 31, United States
Code, is amended by striking ``The Comptroller General--'' and
inserting ``The Directors of CBO and OMB, jointly--''.
SEC. 206. AMENDMENTS TO OTHER LAWS.
(a) Repealers.--The following provisions of law are repealed:
(1) Section 710 of the Social Security Act.
(2) Section 201 (relating to 2-year appropriations) of
Public Law 100-119 (2 U.S.C. 621 note).
(3) Section 203 (relating to financial management reform)
of Public Law 100-119 (2 U.S.C. 621 note).
(4) The first subparagraph (F) of section 201(d)(2) of the
Agricultural Act of 1949 (7 U.S.C. 1446(d)(2)(F)).
(b) Antideficiency Act.--Section 1341(a)(1) of title 31, United
States Code, is amended by striking ``section 252 of the Balanced
Budget and Emergency Deficit Control Act of 1985'' both times it
appears and inserting ``the Deficit Elimination Act of 1993''.
(c) Debt Held by the Public.--(1) Section 3101 of title 31, United
States Code, is amended to read as follows:
``SEC. 3101. PUBLIC DEBT LIMIT.
``(a) The amount of public debt obligations issued under this
chapter, and the amount of debt issued by agencies other than the
Treasury under separate statutory authority, may be not more than
$4,145,000,000,000 outstanding at one time, subject to changes
periodically made in that amount as provided by law through the
congressional budget process described in Rule XLIX of the Rules of the
House of Representatives or otherwise.
``(b) Debt issued to United States Government trust funds or to
other agencies or accounts of the United States Government (except the
Federal Reserve System) shall be excluded from the amount of debt taken
into account in deciding whether the limit of subsection (a) has been
exceeded.
``(c) The limit in subsection (a) shall be applied to the face
amount of securities except for securities issued on a discount basis:
``(1) Securities issued on a discount basis that are
redeemable before maturity at the option of their holders shall
be included in the total subject to subsection (a) at their
current redemption values.
``(2) Securities issued on a discount basis that are not
redeemable before maturity at the option of their holders shall
be included in the total subject to subsection (a) in an amount
equal to the sum of--
``(A) the original purchase price of the
obligation, plus
``(B) the portion of the discount on the obligation
attributable to periods before the beginning of such
month (as determined under the principles of section
1272(a) of the Internal Revenue Code of 1986 without
regard to any exceptions contained in paragraph (2) of
such section).''.
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