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106th Congress                                            Rept. 106-198
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 2
_______________________________________________________________________

                                     




                       THE COMPREHENSIVE BUDGET


                      PROCESS REFORM ACT OF 1999

                               ----------                              

                              R E P O R T

                                 of the

                        COMMITTEE ON THE BUDGET
                        HOUSE OF REPRESENTATIVES

                              to accompany

                                H.R. 853

TO AMEND THE CONGRESSIONAL BUDGET ACT OF 1974 TO PROVIDE FOR JOINT 
  RESOLUTIONS ON THE BUDGET, RESERVE FUNDS FOR EMERGENCY SPENDING, 
  STRENGTHENED ENFORCEMENT OF BUDGETARY DECISIONS, INCREASED 
  ACCOUNTABILITY FOR FEDERAL SPENDING, ACCRUAL BUDGETING FOR FEDERAL 
  INSURANCE PROGRAMS, MITIGATION OF THE BIAS IN THE BUDGET PROCESS TOWARD 
  HIGHER SPENDING, MODIFICATIONS IN PAYGO REQUIREMENTS WHEN THERE IS AN 
  ON-BUDGET SURPLUS, AND FOR OTHER PURPOSES.

                             together with

                     MINORITY AND DISSENTING VIEWS

                                     


                                     

 August 5, 1999.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed


106th Congress                                            Rept. 106-198
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 2
_______________________________________________________________________

                                     



 
           THE COMPREHENSIVE BUDGET PROCESS REFORM ACT OF 1999

                               __________

                              R E P O R T

                                 of the

                        COMMITTEE ON THE BUDGET

                        HOUSE OF REPRESENTATIVES

                              to accompany

                                H.R. 853

TO AMEND THE CONGRESSIONAL BUDGET ACT OF 1974 TO PROVIDE FOR JOINT 
  RESOLUTIONS ON THE BUDGET, RESERVE FUNDS FOR EMERGENCY SPENDING, 
  STRENGTHENED ENFORCEMENT OF BUDGETARY DECISIONS, INCREASED 
  ACCOUNTABILITY FOR FEDERAL SPENDING, ACCRUAL BUDGETING FOR FEDERAL 
  INSURANCE PROGRAMS, MITIGATION OF THE BIAS IN THE BUDGET PROCESS TOWARD 
  HIGHER SPENDING, MODIFICATIONS IN PAYGO REQUIREMENTS WHEN THERE IS AN 
  ON-BUDGET SURPLUS, AND FOR OTHER PURPOSES.

                             together with

                     MINORITY AND DISSENTING VIEWS

                                     


                                     

 August 5, 1999.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                               __________

                    U.S. GOVERNMENT PRINTING OFFICE
58-435                     WASHINGTON : 1999



                        COMMITTEE ON THE BUDGET

                     JOHN R. KASICH, Ohio, Chairman
SAXBY CHAMBLISS, Georgia,            JOHN M. SPRATT, Jr., South 
  Speaker's Designee                     Carolina,
CHRISTOPHER SHAYS, Connecticut         Ranking Minority Member
WALLY HERGER, California             JIM McDERMOTT, Washington,
BOB FRANKS, New Jersey                 Leadership Designee
NICK SMITH, Michigan                 LYNN N. RIVERS, Michigan
JIM NUSSLE, Iowa                     BENNIE G. THOMPSON, Mississippi
PETER HOEKSTRA, Michigan             DAVID MINGE, Minnesota
GEORGE P. RADANOVICH, California     KEN BENTSEN, Texas
CHARLES F. BASS, New Hampshire       JIM DAVIS, Florida
GIL GUTKNECHT, Minnesota             ROBERT A. WEYGAND, Rhode Island
VAN HILLEARY, Tennessee              EVA M. CLAYTON, North Carolina
JOHN E. SUNUNU, New Hampshire        DAVID E. PRICE, North Carolina
JOSEPH PITTS, Pennsylvania           EDWARD J. MARKEY, Massachusetts
JOE KNOLLENBERG, Michigan            GERALD D. KLECZKA, Wisconsin
MAC THORNBERRY, Texas                BOB CLEMENT, Tennessee
JIM RYUN, Kansas                     JAMES P. MORAN, Virginia
MAC COLLINS, Georgia                 DARLENE HOOLEY, Oregon
ZACH WAMP, Tennessee                 KEN LUCAS, Kentucky
MARK GREEN, Wisconsin                RUSH D. HOLT, New Jersey
ERNIE FLETCHER, Kentucky             JOSEPH M. HOEFFEL III, 
GARY MILLER, California                  Pennsylvania
PAUL RYAN, Wisconsin                 TAMMY BALDWIN, Wisconsin
PAT TOOMEY, Pennsylvania

                           Professional Staff

                    Wayne T. Struble, Staff Director
                     James T. Bates, Chief Counsel
       Thomas S. Kahn, Minority Staff Director and Chief Counsel
               Richard Kogan, Minority Director of Policy
                            C O N T E N T S

                              ----------                              
                                                                   Page
Legislative Language.............................................     1
Introduction.....................................................    27
Short Summary....................................................    29
Background and Purpose...........................................    33
Legislative History..............................................    85
Committee Hearings...............................................   101
Summary of Committee Amendments..................................   105
Section-by-Section Description...................................   107
Rollcall Votes and Other Items Required Under House Rules:
    Committee Votes..............................................   135
    Budget Committee Oversight Findings..........................   139
    Constitutional Authority Statement...........................   140
    Oversight Findings and Recommendations of the Committee on 
      Government Reform..........................................   140
    Miscellaneous Budgetary Information..........................   140
    Committee Estimate...........................................   140
    Congressional Budget Office Cost Estimate....................   140
    Changes in Existing Law Made by the Bill, as Reported........   143
    Views of Committee Members...................................   198


106th Congress                                            Rept. 106-198
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 2

======================================================================




                        THE COMPREHENSIVE BUDGET
                       PROCESS REFORM ACT OF 1999

_______________________________________________________________________


                 August 5, 1999.--Ordered to be printed

                                _______
                                

 Mr. Kasich, from the Committee on the Budget, submitted the following

                              R E P O R T

                             together with

                     MINORITY AND ADDITIONAL VIEWS

                        [To accompany H.R. 853]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on the Budget, to whom was referred the bill 
(H.R. 853) to amend the Congressional Budget Act of 1974 to 
provide for joint resolutions on the budget, reserve funds for 
emergency spending, strengthened enforcement of budgetary 
decisions, increased accountability for Federal spending, 
accrual budgeting for Federal insurance programs, mitigation of 
the bias in the budget process toward higher spending, 
modifications in paygo requirements when there is an on-budget 
surplus, and for other purposes, having considered the same, 
reports favorably thereon with an amendment and recommends that 
the bill as amended do pass.

    The amendment is as follows:
    Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Comprehensive 
Budget Process Reform Act of 1999''.
    (b) Table of Contents.--

Sec. 1. Short title; table of contents.
Sec. 2. Purpose.
Sec. 3. Effective date.
Sec. 4. Declaration of purposes for the Budget Act.

                   TITLE I--BUDGET WITH FORCE OF LAW

Sec. 101. Purposes.
Sec. 102. The timetable.
Sec. 3. Effective date.
Sec. 4. Declaration of purposes for the Budget Act.

                   TITLE I--BUDGET WITH FORCE OF LAW

Sec. 101. Purposes.
Sec. 102. The timetable.
Sec. 103. Annual joint resolutions on the budget.
Sec. 104. Budget required before spending bills may be considered; 
fall-back procedures if President vetoes joint budget resolution.
Sec. 105. Conforming amendments to effectuate joint resolutions on the 
budget.

                 TITLE II--RESERVE FUND FOR EMERGENCIES

Sec. 201. Purpose.
Sec. 202. Repeal of adjustments for emergencies.
Sec. 203. OMB emergency criteria.
Sec. 204. Development of guidelines for application of emergency 
definition.
Sec. 205. Reserve fund for emergencies in President's budget.
Sec. 206. Adjustments and reserve fund for emergencies in joint budget 
resolutions.
Sec. 207. Application of section 306 to emergencies in excess of 
amounts in reserve fund.
Sec. 208. Up-to-date tabulations.
Sec. 209. Prohibition on amendments to emergency reserve fund.
Sec. 210. Effective date.

             TITLE III--ENFORCEMENT OF BUDGETARY DECISIONS

Sec. 301. Purposes.

  Subtitle A--Application of Points of Order to Unreported Legislation

Sec. 311. Application of Budget Act points of order to unreported 
legislation.

             Subtitle B--Compliance with Budget Resolution

Sec. 321. Budget compliance statements.

            Subtitle C--Justification for Budget Act Waivers

Sec. 331. Justification for Budget Act waivers in the House of 
Representatives.

             Subtitle D--CBO Scoring of Conference Reports

Sec. 341. CBO scoring of conference reports.

             TITLE IV--ACCOUNTABILITY FOR FEDERAL SPENDING

Sec. 401. Purposes.

               Subtitle A--Limitations on Direct Spending

Sec. 411. Fixed-year authorizations required for new programs.
Sec. 412. Amendments to subject new direct spending to annual 
appropriations.

     Subtitle B--Enhanced Congressional Oversight Responsibilities

Sec. 421. Ten-year congressional review requirement of permanent budget 
authority.
Sec. 422. Justifications of direct spending.
Sec. 423. Survey of activity reports of House committees.
Sec. 424. Continuing study of additional budget process reforms.
Sec. 425. GAO reports.

                Subtitle C--Strengthened Accountability

Sec. 431. Ten-year CBO estimates.
Sec. 432. Repeal of rule XXIII of the Rules of the House of 
Representatives.

    TITLE V--BUDGETING FOR UNFUNDED LIABILITIES AND OTHER LONG-TERM 
                              OBLIGATIONS

Sec. 501. Purposes.

     Subtitle A--Budgetary Treatment of Federal Insurance Programs

Sec. 511. Federal insurance programs.

           Subtitle B--Reports on Long-Term Budgetary Trends

Sec. 521. Reports on long-term budgetary trends.

   TITLE VI--BASELINE, BYRD RULE, LOCK-BOX, AND AUTOMATIC CONTINUING 
                               RESOLUTION

Sec. 601. Purpose.

                        Subtitle A--The Baseline

Sec. 611. The President's budget.
Sec. 612. The congressional budget.
Sec. 613. Congressional Budget Office reports to committees.
Sec. 614. Outyear assumptions for discretionary spending.

                       Subtitle B--The Byrd Rule

Sec. 621. Limitation on Byrd rule.

              Subtitle C--Spending Accountability Lock-Box

Sec. 631. Short title.
Sec. 632. Spending accountability lock-box ledger.
Sec. 633. Downward adjustment of section 302(a) allocations and section 
302(b) suballocations.
Sec. 634. Periodic reporting of ledger statements.
Sec. 635. Downward adjustment of discretionary spending limits.

              Subtitle D--Automatic Continuing Resolution

Sec. 641. Automatic continuing resolution.

              TITLE VII--BUDGETING IN AN ERA OF SURPLUSES

Sec. 701. Paygo requirements and the on-budget surplus.

SEC. 2. PURPOSE.

    The purposes of this Act are to--
            (1) give the budget the force of law;
            (2) budget for emergencies;
            (3) strengthen enforcement of budgetary decisions;
            (4) increase accountability for Federal spending;
            (5) display the unfunded liabilities of Federal insurance 
        programs;
            (6) mitigate the bias in the budget process toward higher 
        spending; and
            (7) modify paygo requirements when there is an on-budget 
        surplus.

SEC. 3. EFFECTIVE DATE.

    Except as otherwise specifically provided, this Act and the 
amendments made by this Act shall become effective on the date of 
enactment of this Act and shall apply with respect to fiscal years 
beginning after September 30, 2000.

SEC. 4. DECLARATION OF PURPOSES FOR THE BUDGET ACT.

    Paragraphs (1) and (2) of section 2 of the Congressional Budget and 
Impoundment Control Act of 1974 are amended to read as follows:
            ``(1) to assure effective control over the budgetary 
        process;
            ``(2) to facilitate the determination each year of the 
        appropriate level of Federal revenues and expenditures by the 
        Congress and the President;''.

                   TITLE I--BUDGET WITH FORCE OF LAW

SEC. 101. PURPOSES.

    The purposes of this title are to--
            (1) focus initial budgetary deliberations on aggregate 
        levels of Federal spending and taxation;
            (2) encourage cooperation between Congress and the 
        President in developing overall budgetary priorities; and
            (3) reach budgetary decisions early in the legislative 
        cycle.

SEC. 102. THE TIMETABLE.

    Section 300 of the Congressional Budget Act of 1974 is amended to 
read as follows:
                              ``timetable
    ``Sec. 300. The timetable with respect to the congressional budget 
process for any fiscal year is as follows:

``On or before:                     Action to be completed:
    First Monday in February
                                        President submits his budget.
    February 15
                                        Congressional Budget Office 
                                                submits report to 
                                                Budget Committees.
    Not later than 6 weeks after 
        President submits budget
                                        Committees submit views and 
                                                estimates to Budget 
                                                Committees.
    April 1
                                        Senate Budget Committee reports 
                                                joint resolution on the 
                                                budget.
    April 15
                                        Congress completes action on 
                                                joint resolution on the 
                                                budget.
    June 10
                                        House Appropriations Committee 
                                                reports last annual 
                                                appropriation bill.
    June 15
                                        Congress completes action on 
                                                reconciliation 
                                                legislation.
    June 30
                                        House completes action on 
                                                annual appropriation 
                                                bills.
    October 1
                                        Fiscal year begins.''.

SEC. 103. ANNUAL JOINT RESOLUTIONS ON THE BUDGET.

    (a) Content of Annual Joint Resolutions on the Budget.--Section 
301(a) of the Congressional Budget Act of 1974 is amended as follows:
            (1) Strike paragraph (4) and insert the following new 
        paragraph:
            ``(4) subtotals of new budget authority and outlays for 
        nondefense discretionary spending, defense discretionary 
        spending, direct spending (excluding interest), and interest; 
        and for fiscal years to which the amendments made by title II 
        of the Comprehensive Budget Process Reform Act of 1999 apply, 
        subtotals of new budget authority and outlays for 
        emergencies;''.
            (2) Strike the last sentence of such subsection.
    (b) Additional Matters in Joint Resolution.--Section 301(b) of the 
Congressional Budget Act of 1974 is amended as follows:
            (1) Strike paragraphs (2), (4), and (6) through (9).
            (2) After paragraph (1), insert the following new 
        paragraph:
            ``(2) if submitted by the Committee on Ways and Means of 
        the House of Representatives or the Committee on Finance of the 
        Senate to the Committee on the Budget of that House of 
        Congress, amend section 3101 of title 31, United States Code, 
        to change the statutory limit on the public debt;''.
            (3) After paragraph (3), insert the following new 
        paragraph:
            ``(4) require such other congressional procedures, relating 
        to the budget, as may be appropriate to carry out the purposes 
        of this Act;''; and
            (4) After paragraph (5), insert the following new 
        paragraph:
            ``(6) set forth procedures in the Senate whereby committee 
        allocations, aggregates, and other levels can be revised for 
        legislation if that legislation would not increase the deficit, 
        or would not increase the deficit when taken with other 
        legislation enacted after the adoption of the resolution, for 
        the first fiscal year or the total period of fiscal years 
        covered by the resolution.''.
    (c) Required Contents of Report.--Section 301(e)(2) of the 
Congressional Budget Act of 1974 is amended as follows:
            (1) Redesignate subparagraphs (A), (B), (C), (D), (E), and 
        (F) as subparagraphs (B), (C), (E), (F), (H), and (I), 
        respectively.
            (2) Before subparagraph (B) (as redesignated), insert the 
        following new subparagraph:
                    ``(A) new budget authority and outlays for each 
                major functional category, based on allocations of the 
                total levels set forth pursuant to subsection 
                (a)(1);''.
            (3) In subparagraph (C) (as redesignated), strike 
        ``mandatory'' and insert ``direct spending''.
            (4) After subparagraph (C) (as redesignated), insert the 
        following new subparagraph:
                    ``(D) a measure, as a percentage of gross domestic 
                product, of total outlays, total Federal revenues, the 
                surplus or deficit, and new outlays for nondefense 
                discretionary spending, defense spending, and direct 
                spending as set forth in such resolution;''.
            (5) After subparagraph (F) (as redesignated), insert the 
        following new subparagraph:
                    ``(G) if the joint resolution on the budget 
                includes any allocation to a committee (other than the 
                Committee on Appropriations) of levels in excess of 
                current law levels, a justification for not subjecting 
                any program, project, or activity (for which the 
                allocation is made) to annual discretionary 
                appropriations;''.
    (d) Additional Contents of Report.--Section 301(e)(3) of the 
Congressional Budget Act of 1974 is amended as follows:
            (1) Redesignate subparagraphs (A) and (B) as subparagraphs 
        (B) and (C), respectively, strike subparagraphs (C) and (D), 
        and redesignate subparagraph (E) as subparagraph (D).
            (2) Before subparagraph (B), insert the following new 
        subparagraph:
                    ``(A) reconciliation directives described in 
                section 310;''.
    (e) President's Budget Submission to the Congress.--(1) The first 
two sentences of section 1105(a) of title 31, United States Code, are 
amended to read as follows:
``On or after the first Monday in January but not later than the first 
Monday in February of each year the President shall submit a budget of 
the United States Government for the following fiscal year which shall 
set forth the following levels:
            ``(A) totals of new budget authority and outlays;
            ``(B) total Federal revenues and the amount, if any, by 
        which the aggregate level of Federal revenues should be 
        increased or decreased by bills and resolutions to be reported 
        by the appropriate committees;
            ``(C) the surplus or deficit in the budget;
            ``(D) subtotals of new budget authority and outlays for 
        nondefense discretionary spending, defense discretionary 
        spending, direct spending, and interest; and for fiscal years 
        to which the amendments made by title II of the Comprehensive 
        Budget Process Reform Act of 1999 apply, subtotals of new 
        budget authority and outlays for emergencies; and
            ``(E) the public debt.
Each budget submission shall include a budget message and summary and 
supporting information and, as a separately delineated statement, the 
levels required in the preceding sentence for at least each of the 9 
ensuing fiscal years.''.
    (2) The third sentence of section 1105(a) of title 31, United 
States Code, is amended by inserting ``submission'' after ``budget''.
    (f) Limitation on Contents of Budget Resolutions.--Section 305 of 
the Congressional Budget Act of 1974 is amended by adding at the end 
the following new subsection:
    ``(e) Limitation on Contents.--(1) It shall not be in order in the 
House of Representatives or in the Senate to consider any joint 
resolution on the budget or any amendment thereto or conference report 
thereon that contains any matter referred to in paragraph (2).
    ``(2) Any joint resolution on the budget or any amendment thereto 
or conference report thereon that contains any matter not permitted in 
section 301(a) or (b) shall not be treated in the House of 
Representatives or the Senate as a budget resolution under subsection 
(a) or (b) or as a conference report on a budget resolution under 
subsection (c) of this section.''.

SEC. 104. BUDGET REQUIRED BEFORE SPENDING BILLS MAY BE CONSIDERED; 
                    FALL-BACK PROCEDURES IF PRESIDENT VETOES JOINT 
                    BUDGET RESOLUTION.

    (a) Amendments to Section 302.--Section 302(a) of the Congressional 
Budget Act of 1974 is amended by striking paragraph (5).
    (b) Amendments to Section 303 and Conforming Amendments.--(1) 
Section 303 of the Congressional Budget Act of 1974 is amended--
            (A) in subsection (b), by striking paragraph (2), by 
        inserting ``or'' at the end of paragraph (1), and by 
        redesignating paragraph (3) as paragraph (2); and
            (B) by striking its section heading and inserting the 
        following new section heading: ``consideration of budget-
        related legislation before budget becomes law''.
    (2) Section 302(g)(1) of the Congressional Budget Act of 1974 is 
amended by striking ``and, after April 15, section 303(a)''.
    (3)(A) Section 904(c)(1) of the Congressional Budget Act of 1974 is 
amended by inserting ``303(a),'' before ``305(b)(2),''.
    (B) Section 904(d)(2) of the Congressional Budget Act of 1974 is 
amended by inserting ``303(a),'' before ``305(b)(2),''.
    (c) Expedited Procedures Upon Veto of Joint Resolution on the 
Budget.--(1) Title III of the Congressional Budget Act of 1974 is 
amended by adding after section 315 the following new section:
   ``expedited procedures upon veto of joint resolution on the budget
    ``Sec. 316. (a) Special Rule.--If the President vetoes a joint 
resolution on the budget for a fiscal year, the majority leader of the 
House of Representatives or Senate (or his designee) may introduce a 
concurrent resolution on the budget or joint resolution on the budget 
for such fiscal year. If the Committee on the Budget of either House 
fails to report such concurrent or joint resolution referred to it 
within five calendar days (excluding Saturdays, Sundays, or legal 
holidays except when that House of Congress is in session) after the 
date of such referral, the committee shall be automatically discharged 
from further consideration of such resolution and such resolution shall 
be placed on the appropriate calendar.
    ``(b) Procedure in the House of Representatives and the Senate.--
            ``(1) Except as provided in paragraph (2), the provisions 
        of section 305 for the consideration in the House of 
        Representatives and in the Senate of joint resolutions on the 
        budget and conference reports thereon shall also apply to the 
        consideration of concurrent resolutions on the budget 
        introduced under subsection (a) and conference reports thereon.
            ``(2) Debate in the Senate on any concurrent resolution on 
        the budget or joint resolution on the budget introduced under 
        subsection (a), and all amendments thereto and debatable 
        motions and appeals in connection therewith, shall be limited 
        to not more than 10 hours and in the House such debate shall be 
        limited to not more than 3 hours.
    ``(c) Contents of Concurrent Resolutions.--Any concurrent 
resolution on the budget introduced under subsection (a) shall be in 
compliance with section 301.
    ``(d) Effect of Concurrent Resolution on the Budget.--
Notwithstanding any other provision of this title, whenever a 
concurrent resolution on the budget described in subsection (a) is 
agreed to, then the aggregates, allocations, and reconciliation 
directives (if any) contained in the report accompanying such 
concurrent resolution or in such concurrent resolution shall be 
considered to be the aggregates, allocations, and reconciliation 
directives for all purposes of sections 302, 303, and 311 for the 
applicable fiscal years and such concurrent resolution shall be deemed 
to be a joint resolution for all purposes of this title and the Rules 
of the House of Representatives and any reference to the date of 
enactment of a joint resolution on the budget shall be deemed to be a 
reference to the date agreed to when applied to such concurrent 
resolution.''.
    (2) The table of contents set forth in section 1(b) of the 
Congressional Budget and Impoundment Control Act of 1974 is amended by 
inserting after the item relating to section 315 the following new 
item:

``Sec. 316. Expedited procedures upon veto of joint resolution on the 
budget.''.

SEC. 105. CONFORMING AMENDMENTS TO EFFECTUATE JOINT RESOLUTIONS ON THE 
                    BUDGET.

    (a) Conforming Amendments to the Congressional Budget and 
Impoundment Control Act of 1974.--(1)(A) Sections 301, 302, 303, 305, 
308, 310, 311, 312, 314, 405, and 904 of the Congressional Budget Act 
of 1974 (2 U.S.C. 621 et seq.) are amended by striking ``concurrent'' 
each place it appears and by inserting ``joint''.
    (B)(i) Sections 302(d), 302(g), 308(a)(1)(A), and 310(d)(1) of the 
Congressional Budget Act of 1974 are amended by striking ``most 
recently agreed to concurrent resolution on the budget'' each place it 
occurs and inserting ``most recently enacted joint resolution on the 
budget or agreed to concurrent resolution on the budget (as 
applicable)''.
    (ii) The section heading of section 301 is amended by striking 
``adoption of concurrent resolution'' and inserting ``joint 
resolutions'';
    (iii) Section 304 of such Act is amended to read as follows:
             ``permissible revisions of budget resolutions
    ``Sec. 304. At any time after the joint resolution on the budget 
for a fiscal year has been enacted pursuant to section 301, and before 
the end of such fiscal year, the two Houses and the President may enact 
a joint resolution on the budget which revises or reaffirms the joint 
resolution on the budget for such fiscal year most recently enacted. If 
a concurrent resolution on the budget has been agreed to pursuant to 
section 316, then before the end of such fiscal year, the two Houses 
may adopt a concurrent resolution on the budget which revises or 
reaffirms the concurrent resolution on the budget for such fiscal year 
most recently agreed to.''.
    (C) Sections 302, 303, 310, and 311, of such Act are amended by 
striking ``agreed to'' each place it appears and by inserting 
``enacted''.
    (2)(A) Paragraph (4) of section 3 of the Congressional Budget and 
Impoundment Control Act of 1974 is amended by striking ``concurrent'' 
each place it appears and by inserting ``joint''.
    (B) The table of contents set forth in section 1(b) of such Act is 
amended--
            (i) in the item relating to section 301, by striking 
        ``adoption of concurrent resolution'' and inserting ``joint 
        resolutions'';
            (ii) by striking the item relating to section 303 and 
        inserting the following:

``Sec. 303. Consideration of budget-related legislation before budget 
becomes law.'';

            (iii) in the item relating to section 304, by striking 
        ``concurrent'' and inserting ``budget'' the first place it 
        appears and by striking ``on the budget''; and
            (iv) by striking ``concurrent'' and inserting ``joint'' in 
        the item relating to section 305.
    (b) Conforming Amendments to the Rules of the House of 
Representatives.--(1) Clauses 1(e)(1), 4(a)(4), 4(b)(2), 4(f)(1)(A), 
and 4(f)(2) of rule X, clause 10 of rule XVIII, and clause 10 of rule 
XX of the Rules of the House of Representatives are amended by striking 
``concurrent'' each place it appears and inserting ``joint''.
    (2) Clause 10 of rule XVIII of the Rules of the House of 
Representatives is amended--
            (A) in paragraph (b)(2), by striking ``(5)'' and inserting 
        ``(6)''; and
            (B) by striking paragraph (c).
    (c) Conforming Amendments to the Balanced Budget and Emergency 
Deficit Control Act of 1985.--Section 258C(b)(1) of the Balanced Budget 
and Emergency Deficit Control Act of 1985 (2 U.S.C. 907d(b)(1)) is 
amended by striking ``concurrent'' and inserting ``joint''.
    (d) Conforming Amendments to Section 310 Regarding Reconciliation 
Directives.--(1) The side heading of section 310(a) of the 
Congressional Budget Act of 1974 (as amended by section 105(a)) is 
further amended by inserting ``Joint Explanatory Statement Accompanying 
Conference Report on'' before ``Joint''.
    (2) Section 310(a) of such Act is amended by striking ``A'' and 
inserting ``The joint explanatory statement accompanying the conference 
report on a''.
    (3) The first sentence of section 310(b) of such Act is amended by 
striking ``If'' and inserting ``If the joint explanatory statement 
accompanying the conference report on''.
    (4) Section 310(c)(1) of such Act is amended by inserting ``the 
joint explanatory statement accompanying the conference report on'' 
after ``pursuant to''.
    (5) Subsection (g) of section 310 of such Act is repealed.
    (e) Conforming Amendments to Section 3 Regarding Direct Spending.--
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 `direct spending' has the meaning given to 
        such term in section 250(c)(8) of the Balanced Budget and 
        Emergency Deficit Control Act of 1985.''.
    (f) Technical Amendment Regarding Revised Suballocations.--Section 
314(d) of the Congressional Budget Act of 1974 is amended by--
            (1) striking ``Reporting'' in the side heading, by 
        inserting ``the chairmen of'' before ``the Committees'', and by 
        striking ``may report'' and inserting ``shall make and have 
        published in the Congressional Record''; and
            (2) adding at the end the following new sentence: ``For 
        purposes of considering amendments (other than for amounts for 
        emergencies covered by subsection (b)(1)), suballocations shall 
        be deemed to be so adjusted.''.

                 TITLE II--RESERVE FUND FOR EMERGENCIES

SEC. 201. PURPOSE.

    The purposes of this title are to--
            (1) develop budgetary and fiscal procedures for 
        emergencies;
            (2) subject spending for emergencies to budgetary 
        procedures and controls; and
            (3) establish criteria for determining compliance with 
        emergency requirements.

SEC. 202. REPEAL OF ADJUSTMENTS FOR EMERGENCIES.

    (a) Discretionary Spending Limits.--(1) Section 251(b)(2)(A) of the 
Balanced Budget and Emergency Deficit Control Act of 1985 is repealed.
    (2) Such section 251(b)(2) is further amended by redesignating 
subparagraphs (B) through (G) as subparagraphs (A) through (F).
    (b) Direct Spending.--Sections 252(e) and 252(d)(4)(B) of the 
Balanced Budget and Emergency Deficit Control Act of 1985 are repealed.
    (c) Emergency Designation.--Clause 2 of rule XXI of the Rules of 
the House of Representatives is amended by repealing paragraph (e) and 
by redesignating paragraph (f) as paragraph (e).
    (d) Amount of Adjustments.--Section 314(b) of the Congressional 
Budget Act of 1974 is amended by striking paragraph (1) and by 
redesignating paragraphs (2) through (6) as paragraphs (1) through (5), 
respectively.

SEC. 203. OMB EMERGENCY CRITERIA.

    Section 3 of the Congressional Budget and Impoundment Control Act 
of 1974 (as amended by section 105(e)) is further amended by adding at 
the end the following new paragraph:
            ``(12)(A) The term `emergency' means a situation that--
                    ``(i) requires new budget authority and outlays (or 
                new budget authority and the outlays flowing therefrom) 
                for the prevention or mitigation of, or response to, 
                loss of life or property, or a threat to national 
                security; and
                    ``(ii) is unanticipated.
            ``(B) As used in subparagraph (A), the term `unanticipated' 
        means that the situation is--
                    ``(i) sudden, which means quickly coming into being 
                or not building up over time;
                    ``(ii) urgent, which means a pressing and 
                compelling need requiring immediate action;
                    ``(iii) unforeseen, which means not predicted or 
                anticipated as an emerging need; and
                    ``(iv) temporary, which means not of a permanent 
                duration.''.

SEC. 204. DEVELOPMENT OF GUIDELINES FOR APPLICATION OF EMERGENCY 
                    DEFINITION.

    Not later than 5 months after the date of enactment of this Act, 
the chairmen of the Committees on the Budget (in consultation with the 
President) shall, after consulting with the chairmen of the Committees 
on Appropriations and applicable authorizing committees of their 
respective Houses and the Directors of the Congressional Budget Office 
and the Office of Management and Budget, jointly publish in the 
Congressional Record guidelines for application of the definition of 
emergency set forth in section 3(12) of the Congressional Budget and 
Impoundment Control Act of 1974.

SEC. 205. RESERVE FUND FOR EMERGENCIES IN PRESIDENT'S BUDGET.

    Section 1105(f) of title 31, United States Code is amended by 
adding at the end the following new sentences: ``Such budget submission 
shall also comply with the requirements of section 317(b) of the 
Congressional Budget Act of 1974 and, in the case of any budget 
authority requested for an emergency, such submission shall include a 
detailed justification of why such emergency is an emergency within the 
meaning of section 3(12) of the Congressional Budget Act of 1974.''.

SEC. 206. ADJUSTMENTS AND RESERVE FUND FOR EMERGENCIES IN JOINT BUDGET 
                    RESOLUTIONS.

    (a) Emergencies.--Title III of the Congressional Budget Act of 1974 
(as amended by section 104(c)) is further amended by adding at the end 
the following new section:
                             ``emergencies
    ``Sec. 317. (a) Adjustments.--
            ``(1) In general.--After the reporting of a bill or joint 
        resolution or the submission of a conference report thereon 
        that provides budget authority for any emergency as identified 
        pursuant to subsection (d)--
                    ``(A) the chairman of the Committee on the Budget 
                of the House of Representatives or the Senate shall 
                determine and certify, pursuant to the guidelines 
                referred to in section 204 of the Comprehensive Budget 
                Process Reform Act of 1999, the portion (if any) of the 
                amount so specified that is for an emergency within the 
                meaning of section 3(12); and
                    ``(B) such chairman shall make the adjustment set 
                forth in paragraph (2) for the amount of new budget 
                authority (or outlays) in that measure and the outlays 
                flowing from that budget authority.
            ``(2) Matters to be adjusted.--The adjustments referred to 
        in paragraph (1) are to be made to the allocations made 
        pursuant to the appropriate joint resolution on the budget 
        pursuant to section 302(a) and shall be in an amount not to 
        exceed the amount reserved for emergencies pursuant to the 
        requirements of subsection (b).
    ``(b) Reserve Fund for Emergencies.--
            ``(1) Amounts.--The amount set forth in the reserve fund 
        for emergencies for budget authority and outlays for a fiscal 
        year pursuant to section 301(a)(4) shall equal--
                    ``(A) the average of the enacted levels of budget 
                authority for emergencies in the 5 fiscal years 
                preceding the current year; and
                    ``(B) the average of the levels of outlays for 
                emergencies in the 5 fiscal years preceding the current 
                year flowing from the budget authority referred to in 
                subparagraph (A), but only in the fiscal year for which 
                such budget authority first becomes available for 
                obligation.
            ``(2) Average levels.--For purposes of paragraph (1), the 
        amount used for a fiscal year to calculate the average of the 
        enacted levels when one or more of such 5 preceding fiscal 
        years is any of fiscal years 1994 through 1998 is as follows: 
        the amount of enacted levels of budget authority and the amount 
        of new outlays flowing therefrom for emergencies, but only in 
        the fiscal year for which such budget authority first becomes 
        available for obligation for each of such 5 fiscal years, which 
        shall be determined by the Committees on the Budget of the 
        House of Representatives and the Senate after receipt of a 
        report on such matter transmitted to such committees by the 
        Director of the Congressional Budget Office 6 months after the 
        date of enactment of this section and thereafter in February of 
        each calendar year.
    ``(c) Emergencies in Excess of Amounts in Reserve Fund.--Whenever 
the Committee on Appropriations or any other committee reports any bill 
or joint resolution that provides budget authority for any emergency 
and the report accompanying that bill or joint resolution, pursuant to 
subsection (d), identifies any provision that increases outlays or 
provides budget authority (and the outlays flowing therefrom) for such 
emergency, the enactment of which would cause--
            ``(1) in the case of the Committee on Approrpiations, the 
        total amount of budget authority or outlays provided for 
        emergencies for the budget year; or
            ``(2) in the case of any other committee, the total amount 
        of budget authority or outlays provided for emergencies for the 
        budget year or the total of the fiscal years;
in the joint resolution on the budget (pursuant to section 301(a)(4)) 
to be exceeded:
            ``(A) Such bill or joint resolution shall be referred to 
        the Committee on the Budget of the House or the Senate, as the 
        case may be, with instructions to report it without amendment, 
        other than that specified in subparagraph (B), within 5 
        legislative days of the day in which it is reported from the 
        originating committee. If the Committee on the Budget of either 
        House fails to report a bill or joint resolution referred to it 
        under this subparagraph within such 5-day period, the committee 
        shall be automatically discharged from further consideration of 
        such bill or joint resolution and such bill or joint resolution 
        shall be placed on the appropriate calendar.
            ``(B) An amendment to such a bill or joint resolution 
        referred to in this subsection shall only consist of an 
        exemption from section 251 or 252 (as applicable) of the 
        Balanced Budget and Emergency Deficit Control Act of 1985 of 
        all or any part of the provisions that provide budget authority 
        (and the outlays flowing therefrom) for such emergency if the 
        committee determines, pursuant to the guidelines referred to in 
        section 204 of the Comprehensive Budget Process Reform Act of 
        1999, that such budget authority is for an emergency within the 
        meaning of section 3(12).
            ``(C) If such a bill or joint resolution is reported with 
        an amendment specified in subaragraph (B) by the Committee on 
        the Budget of the House of Representatives or the Senate, then 
        the budget authority and resulting outlays that are the subject 
        of such amendment shall not be included in any determinations 
        under section 302(f) or 311(a) for any bill, joint resolution, 
        amendment, motion, or conference report.
    ``(d) Committee Notification of Emergency Legislation.--Whenever 
the Committee on Appropriations or any other committee of either House 
(including a committee of conference) reports any bill or joint 
resolution that provides budget authority for any emergency, the report 
accompanying that bill or joint resolution (or the joint explanatory 
statement of managers in the case of a conference report on any such 
bill or joint resolution) shall identify all provisions that provide 
budget authority and the outlays flowing therefrom for such emergency 
and include a statement of the reasons why such budget authority meets 
the definition of an emergency pursuant to the guidelines referred to 
in section 204 of the Comprehensive Budget Process Reform Act of 
1999.''.
    (b) Conforming Amendment.--The table of contents set forth in 
section 1(b) of the Congressional Budget and Impoundment Control Act of 
1974 is amended by inserting after the item relating to section 316 the 
following new item:

``Sec. 317. Emergencies.''.

SEC. 207. APPLICATION OF SECTION 306 TO EMERGENCIES IN EXCESS OF 
                    AMOUNTS IN RESERVE FUND.

    Section 306 of the Congressional Budget Act of 1974 is amended by 
inserting at the end the following new sentence: ``No amendment 
reported by the Committee on the Budget (or from the consideration of 
which such committee has been discharged) pursuant to section 317(c) 
may be amended.''.

SEC. 208. UP-TO-DATE TABULATIONS.

    Section 308(b)(2) of the Congressional Budget Act of 1974 is 
amended by striking ``and'' at the end of subparagraph (B), by striking 
the period at the end of subparagraph (C) and inserting ``; and'', and 
by adding at the end the following new subparagraph:
                    ``(D) shall include an up-to-date tabulation of 
                amounts remaining in the reserve fund for 
                emergencies.''.

SEC. 209. PROHIBITION ON AMENDMENTS TO EMERGENCY RESERVE FUND.

    (a) Point of Order.--Section 305 of the Congressional Budget Act of 
1974 (as amended by section 103(c)) is further amended by adding at the 
end the following new subsection:
    ``(f) Point of Order Regarding Emergency Reserve Fund.--It shall 
not be in order in the House of Representatives or in the Senate to 
consider an amendment to a joint resolution on the budget which changes 
the amount of budget authority and outlays set forth in section 
301(a)(4) for emergency reserve fund.''.
    (b) Technical Amendment.--(1) Section 904(c)(1) of the 
Congressional Budget Act of 1974 is amended by inserting ``305(e), 
305(f),'' after ``305(c)(4),''.
    (2) Section 904(d)(2) of the Congressional Budget Act of 1974 is 
amended by inserting ``305(e), 305(f),'' after ``305(c)(4),''.

SEC. 210. EFFECTIVE DATE.

    The amendments made by this title shall apply to fiscal year 2001 
and subsequent fiscal years, but such amendments shall take effect only 
after the enactment of legislation changing or extending for any fiscal 
year the discretionary spending limits set forth in section 251 of the 
Balanced Budget and Emergency Deficit Control Act of 1985 or 
legislation reducing the amount of any sequestration under section 252 
of such Act by the amount of any reserve for any emergencies.

             TITLE III--ENFORCEMENT OF BUDGETARY DECISIONS

SEC. 301. PURPOSES.

    The purposes of this title are to--
            (1) close loopholes in the enforcement of budget 
        resolutions;
            (2) require committees of the House of Representatives to 
        include budget compliance statements in reports accompanying 
        all legislation; and
            (3) require committees of the House of Representatives to 
        justify the need for waivers of the Congressional Budget Act of 
        1974;
            (4) provide cost estimates of conference reports.

  Subtitle A--Application of Points of Order to Unreported Legislation

SEC. 311. APPLICATION OF BUDGET ACT POINTS OF ORDER TO UNREPORTED 
                    LEGISLATION.

    (a) Section 315 of the Congressional Budget Act of 1974 is amended 
by striking ``reported'' the first place it appears.
    (b) Section 303(b) of the Congressional Budget Act of 1974 (as 
amended by section 104(b)(1)) is further amended--
            (1) in paragraph (1), by striking ``(A)'' and by 
        redesignating subparagraph (B) as paragraph (2) and by striking 
        the semicolon at the end of such new paragraph (2) and 
        inserting a period; and
            (2) by striking paragraph (2) (as redesignated by such 
        section 104(b)(1)).

             Subtitle B--Compliance with Budget Resolution

SEC. 321. BUDGET COMPLIANCE STATEMENTS.

    Clause 3(d) of rule XIII of the Rules of the House of 
Representatives is amended by adding at the end the following new 
subparagraph:
            ``(4) A budget compliance statement prepared by the 
        chairman of the Committee on the Budget, if timely submitted 
        prior to the filing of the report, which shall include 
        assessment by such chairman as to whether the bill or joint 
        resolution complies with the requirements of sections 302, 303, 
        306, 311, and 401 of the Congressional Budget Act of 1974 and 
        may include the budgetary implications of that bill or joint 
        resolution under section 251 or 252 of the Balanced Budget and 
        Emergency Deficit Control Act of 1985, as applicable.''.

            Subtitle C--Justification for Budget Act Waivers

SEC. 331. JUSTIFICATION FOR BUDGET ACT WAIVERS IN THE HOUSE OF 
                    REPRESENTATIVES.

    Clause 6 of rule XIII of the Rules of the House of Representatives 
is amended by adding at the end the following new paragraph:
    ``(h) It shall not be in order to consider any resolution from the 
Committee on Rules for the consideration of any reported bill or joint 
resolution which waives section 302, 303, 311, or 401 of the 
Congressional Budget Act of 1974, unless the report accompanying such 
resolution includes a description of the provision proposed to be 
waived, an identification of the section being waived, the reasons why 
such waiver should be granted, and an estimated cost of the provisions 
to which the waiver applies.''.

             Subtitle D--CBO Scoring of Conference Reports

SEC. 341. CBO SCORING OF CONFERENCE REPORTS.

    (a) The first sentence of section 402 of the Congressional Budget 
Act of 1974 is amended as follows:
            (1) Insert ``or conference report thereon,'' before ``and 
        submit''.
            (2) In paragraph (1), strike ``bill or resolution'' and 
        insert ``bill, joint resolution, or conference report''.
            (3) At the end of paragraph (2) strike ``and'', at the end 
        of paragraph (3) strike the period and insert ``; and'', and 
        after such paragraph (3) add the following new paragraph:
            ``(4) A determination of whether such bill, joint 
        resolution, or conference report provides direct spending.''.
    (b) The second sentence of section 402 of the Congressional Budget 
Act of 1974 is amended by inserting before the period the following: 
``, or in the case of a conference report, shall be included in the 
joint explanatory statement of managers accompanying such conference 
report if timely submitted before such report is filed''.

             TITLE IV--ACCOUNTABILITY FOR FEDERAL SPENDING

SEC. 401. PURPOSES.

    The purposes of this title are to--
            (1) require committees to develop a schedule for 
        reauthorizing all programs within their jurisdictions;
            (2) facilitate amendments to subject new entitlement 
        programs to annual discretionary appropriations;
            (3) require the Committee on the Budget to justify any 
        allocation to an authorizing committee for legislation that 
        would not be subject to annual discretionary appropriation;
            (4) provide estimates of the long-term impact of spending 
        and tax legislation;
            (5) provide a point of order for legislation creating a new 
        direct spending program that does not expire within 10 years; 
        and
            (6) require a vote in the House of Representatives on any 
        measure that increases the statutory limit on the public debt.

               Subtitle A--Limitations on Direct Spending

SEC. 411. FIXED-YEAR AUTHORIZATIONS REQUIRED FOR NEW PROGRAMS.

    (a) In General.--Section 401 of the Congressional Budget Act of 
1974 is amended--
            (1) by striking subsections (a) and (b) and inserting the 
        following new subsection:
    ``(a) Limitation on Direct Spending.--It shall not be in order in 
the House of Representatives or in the Senate to consider a bill or 
joint resolution, or an amendment, motion, or conference report that 
provides direct spending for a new program, unless such spending is 
limited to a period of 10 or fewer fiscal years.'';
            (2) by redesignating subsection (c) as subsection (b) and 
        by striking ``Subsections (a) and (b) each place it appears and 
        inserting ``Subsection (a)'' in such redesignated subsection 
        (b); and
            (3) by amending the section heading to read as follows:
      ``fixed-year authorizations required for direct spending''.
    (b) Conforming Amendment.--The item relating to section 401 in the 
table of contents set forth in section 1(b) of the Congressional Budget 
and Impoundment Control Act of 1974 is amended to read as follows:

``Sec. 401. Fixed-year authorizations required for direct spending.''.

    (c) Limitation on Authorization of Discretionary Appropriations.--
Rule XXI of the Rules of the House of Representatives is amended by 
adding at the end the following new clause:
    ``6. It shall not be in order to consider any bill, joint 
resolution, amendment, or conference report that authorizes the 
appropriation of new budget authority (as defined in section 3(2)(C) of 
the Congressional Budget and Impoundment Control Act of 1974) for a new 
program, unless such authorization is specifically provided for a 
period of 10 or fewer fiscal years.''.

SEC. 412. AMENDMENTS TO SUBJECT NEW DIRECT SPENDING TO ANNUAL 
                    APPROPRIATIONS.

    (a) House Procedures.--Clause 5 of rule XVIII of the Rules of the 
House of Representatives is amended by adding at the end the following 
new paragraph:
    ``(c)(1) In the Committee of the Whole, an amendment only to 
subject a new program which provides direct spending to discretionary 
appropriations, if offered by the chairman of the Committee on the 
Budget (or his designee) or the chairman of the Committee of 
Appropriations (or his designee), may be precluded from consideration 
only by the specific terms of a special order of the House. Any such 
amendment, if offered, shall be debatable for twenty minutes equally 
divided and controlled by the proponent of the amendment and a Member 
opposed and shall not be subject to amendment.
    ``(2) As used in subparagraph (1), the term `direct spending' has 
the meaning given such term in section 3(11) of the Congressional 
Budget and Impoundment Control Act of 1974.''.
    (b) Adjustment of Discretionary Spending Limits for Discretionary 
Appropriations Offset by Direct Spending Savings.--
            (1) Purpose.--The purpose of the amendments made by this 
        subsection is to hold the discretionary spending limits and the 
        allocations made to the Committee on Appropriations under 
        section 302(a) of the Congressional Budget Act of 1974 harmless 
        for legislation that offsets a new discretionary program with a 
        designated reduction in direct spending.
            (2) Designating direct spending savings in authorization 
        legislation for new discretionary programs.--Section 252 of the 
        Balanced Budget and Emergency Deficit Control Act of 1985 (as 
        amended by section 202) is further amended by adding at the end 
        the following new subsection:
    ``(e) Offsets.--If a provision of direct spending legislation is 
enacted that--
            ``(1) decreases direct spending for any fiscal year; and
            ``(2) is designated as an offset pursuant to this 
        subsection and such designation specifically identifies an 
        authorization of discretionary appropriations (contained in 
        such legislation) for a new program,
then the reductions in new budget authority and outlays in all fiscal 
years resulting from that provision shall be designated as an offset in 
the reports required under subsection (d).''.
            (3) Exempting such designated direct spending savings from 
        paygo scorecard.--Section 252(d)(4) of the Balanced Budget and 
        Emergency Deficit Control Act of 1985 (as amended by section 
        202(b)) is further amended by adding at the end the following 
        new subparagraph:
                    ``(B) offset provisions as designated under 
                subsection (e).''.
            (4) Adjustment in discretionary spending limits.--Section 
        251(b)(2) of the Balanced Budget and Emergency Deficit Control 
        Act of 1985 (as amended by section 202(a)(2)) is further 
        amended by adding at the end the following new subparagraph:
                    ``(G) Discretionary authorization offsets.--If an 
                Act other than an appropriation Act includes any 
                provision reducing direct spending and specifically 
                identifies any such provision as an offset pursuant to 
                section 252(e), the adjustments shall be an increase in 
                the discretionary spending limits for budget authority 
                and outlays in each fiscal year equal to the amount of 
                the budget authority and outlay reductions, 
                respectively, achieved by the specified offset in that 
                fiscal year, except that the adjustments for the budget 
                year in which the offsetting provision takes effect 
                shall not exceed the amount of discretionary new budget 
                authority provided for the new program (authorized in 
                that Act) in an Act making discretionary appropriations 
                and the outlays flowing therefrom.''.
            (5) Adjustment in appropriation committee's allocations.--
        Section 314(b) of the Congressional Budget Act of 1974 (as 
        amended by section 202(d)) is further amended by striking ``; 
        or'' at the end of paragraph (4), by striking the period and 
        inserting ``; or'' at the end of paragraph (5), and by adding 
        at the end the following new paragraph:
            ``(6) the amount provided in an Act making discretionary 
        appropriations for the program for which an offset was 
        designated pursuant to section 252(e) of the Balanced Budget 
        and Emergency Deficit Control Act of 1985 and any outlays 
        flowing therefrom, but not to exceed the amount of the 
        designated decrease in direct spending for that year for that 
        program in a prior law.''.
            (6) Adjustment in authorizing committee's allocations.--
        Section 314 of the Congressional Budget Act of 1974 is amended 
        by adding at the end the following new subsection:
    ``(f) Adjustment in Authorizing Committee's Allocations by Amount 
of Direct Spending Offset.--After the reporting of a bill or joint 
resolution (by a committee other than the Committee on Appropriations), 
or the offering of an amendment thereto or the submission of a 
conference report thereon, that contains a provision that decreases 
direct spending for any fiscal year and that is designated as an offset 
pursuant to section 252(e) of the Balanced Budget and Emergency Deficit 
Control Act of 1985, the chairman of the Committee on the Budget shall 
reduce the allocations of new budget authority and outlays made to such 
committee under section 302(a)(1) by the amount so designated.''.

     Subtitle B--Enhanced Congressional Oversight Responsibilities

SEC. 421. TEN-YEAR CONGRESSIONAL REVIEW REQUIREMENT OF PERMANENT BUDGET 
                    AUTHORITY.

    (a) Timetable for Review.--Clause 2(d)(1) of rule X of the Rules of 
the House of Representatives is amended by striking subdivisions (B) 
and (C) and inserting the following new subdivision:
            ``(B) provide in its plans a specific timetable for its 
        review of those laws, programs, or agencies within its 
        jurisdiction, including those that operate under permanent 
        budget authority or permanent statutory authority.''.
    (b) Review of Permanent Budget Authority by the Committee on 
Appropriations.--Clause 4(a) of rule X of the Rules of the House of 
Representatives is amended--
            (1) by striking subparagraph (2); and
            (2) by redesignating subparagraphs (3) and (4) as 
        subparagraphs (2) and (3) and by striking ``from time to time'' 
        and inserting ``at least once each Congress'' in subparagraph 
        (2) (as redesignated).
    (c) Conforming Amendment.--Clause 4(e)(2) of rule X of the Rules of 
the House of Representatives is amended by striking ``from time to 
time'' and inserting ``at least once every ten years''.

SEC. 422. JUSTIFICATIONS OF DIRECT SPENDING.

    (a) Section 302 Allocations.--Section 302(a) of the Congressional 
Budget Act of 1974 (as amended by section 104(a)) is further amended by 
adding at the end the following new paragraph:
            ``(5) Justification of certain spending allocations.--The 
        joint explanatory statement accompanying a conference report on 
        a joint resolution on the budget that includes any allocation 
        to a committee (other than the Committee on Appropriations) of 
        levels in excess of current law levels shall set forth a 
        justification for not subjecting any program, project, or 
        activity (for which the allocation is made) to annual 
        discretionary appropriation.''.
    (b) Presidents' Budget Submissions.--Section 1105(a) of title 31, 
United States Code, is amended by adding at the end the following new 
paragraph:
            ``(33) a justification for not subjecting each proposed new 
        direct spending program, project, or activity to discretionary 
        appropriations.''.
    (c) Committee Justification for Direct Spending.--Clause 4(e)(2) of 
rule X of the Rules of the House of Representatives is amended by 
inserting before the period the following: ``, and will provide 
specific information in any report accompanying such bills and joint 
resolutions to the greatest extent practicable to justify why the 
programs, projects, and activities involved would not be subject to 
annual appropriation''.

SEC. 423. SURVEY OF ACTIVITY REPORTS OF HOUSE COMMITTEES.

    Clause 1(d) of rule XI of the Rules of the House of Representatives 
is amended by redesignating paragraph (4) as paragraph (5) and by 
inserting after paragraph (3) the following new paragraph:
    ``(4) Such report shall include a summary of and justifications for 
all bills and joint resolutions reported by such committee that--
            ``(A) were considered before the adoption of the 
        appropriate budget resolution and did not fall within an 
        exception set forth in section 303(b) of the Congressional 
        Budget Act of 1974;
            ``(B) exceeded its allocation under section 302(a) of such 
        Act or breached an aggregate level in violation of section 311 
        of such Act; or
            ``(C) contained provisions in violation of section 401(a) 
        of such Act pertaining to indefinite direct spending authority.
Such report shall also specify the total amount by which legislation 
reported by that committee exceeded its allocation under section 302(a) 
or breached the revenue floor under section 311(a) of such Act for each 
fiscal year during that Congress.''.

SEC. 424. CONTINUING STUDY OF ADDITIONAL BUDGET PROCESS REFORMS.

    Section 703 of the Congressional Budget Act of 1974 is amended as 
follows:
            (1) In subsection (a), strike ``and'' at the end of 
        paragraph (3), strike the period at the end of paragraph (4) 
        and insert ``; and'', and at the end add the following new 
        paragraph:
            ``(5) evaluating whether existing programs, projects, and 
        activities should be subject to discretionary 
        appropriations.''.
            (2) In subsection (b), strike ``from time to time'' and 
        insert ``during the One Hundred Sixth Congress''.
            (3) Add at the end the following new subsection:
    ``(d) The Committee on the Budget of each House shall establish 
guidelines for subjecting new or expanded programs, projects, and 
activities to annual appropriation and recommend any necessary changes 
in statutory enforcement mechanisms and scoring conventions to 
effectuate such changes.''.

SEC. 425. GAO REPORTS.

      The last sentence of section 404 of the Congressional Budget Act 
of 1974 is amended to read as follows: ``Such report shall be revised 
at least once every five years and shall be transmitted to the chairman 
and ranking minority member of each committee of the House of 
Representatives and the Senate.''.

                Subtitle C--Strengthened Accountability

SEC. 431. TEN-YEAR CBO ESTIMATES.

    (a) CBO Reports on Legislation.--Section 308(a)(1)(B) of the 
Congressional Budget Act of 1974 is amended by striking ``four'' and 
inserting ``nine''.
    (b) Analysis by CBO.--Section 402(1) of the Congressional Budget 
Act of 1974 is amended by striking ``4'' and inserting ``nine''.
    (c) Cost Estimates.--Clause 3(d)(2)(A) of rule XIII of the Rules of 
the House of Representatives is amended by striking ``five'' each place 
it appears and inserting ``10''.

SEC. 432. REPEAL OF RULE XXIII OF THE RULES OF THE HOUSE OF 
                    REPRESENTATIVES.

    Rule XXIII of the Rules of the House of Representatives (relating 
to the establishment of the statutory limit on the public debt) is 
repealed.

    TITLE V--BUDGETING FOR UNFUNDED LIABILITIES AND OTHER LONG-TERM 
                              OBLIGATIONS

SEC. 501. PURPOSES.

    The purposes of this title are to--
            (1) budget for the long-term costs of Federal insurance 
        programs;
            (2) improve congressional control of those costs; and
            (3) periodically report on long-term budgetary trends.

     Subtitle A--Budgetary Treatment of Federal Insurance Programs

SEC. 511. FEDERAL INSURANCE PROGRAMS.

    (a) In General.--The Congressional Budget Act of 1974 is amended by 
adding after title V the following new title:

     ``TITLE VI--BUDGETARY TREATMENT OF FEDERAL INSURANCE PROGRAMS

``SEC. 601. SHORT TITLE.

    ``This title may be cited as the `Federal Insurance Budgeting Act 
of 1999'.

``SEC. 602. BUDGETARY TREATMENT.

    ``(a) President's Budget.--Beginning with fiscal year 2006, the 
budget of the Government pursuant to section 1105(a) of title 31, 
United States Code, shall be based on the risk-assumed cost of Federal 
insurance programs.
    ``(b) Budget Accounting.--For any Federal insurance program--
            ``(1) the program account shall--
                    ``(A) pay the risk-assumed cost borne by the 
                taxpayer to the financing account, and
                    ``(B) pay actual insurance program administrative 
                costs;
            ``(2) the financing account shall--
                    ``(A) receive premiums and other income,
                    ``(B) pay all claims for insurance and receive all 
                recoveries,
                    ``(C) transfer to the program account on not less 
                than an annual basis amounts necessary to pay insurance 
                program administrative costs;
            ``(3) a negative risk-assumed cost shall be transferred 
        from the financing account to the program account, and shall be 
        transferred from the program account to the general fund; and
            ``(4) all payments by or receipts of the financing accounts 
        shall be treated in the budget as a means of financing.
    ``(c) Appropriations Required.--(1) Notwithstanding any other 
provision of law, insurance commitments may be made for fiscal year 
2006 and thereafter only to the extent that new budget authority to 
cover their risk-assumed cost is provided in advance in an 
appropriation Act.
    ``(2) An outstanding insurance commitment shall not be modified in 
a manner that increases its risk-assumed cost unless budget authority 
for the additional cost has been provided in advance.
    ``(3) Paragraph (1) shall not apply to Federal insurance programs 
that constitute entitlements.
    ``(d) Reestimates.--The risk-assumed cost for a fiscal year shall 
be reestimated in each subsequent year. Such reestimate can equal zero. 
In the case of a positive reestimate, the amount of the reestimate 
shall be paid from the program account to the financing account. In the 
case of a negative reestimate, the amount of the reestimate shall be 
paid from the financing account to the program account, and shall be 
transferred from the program account to the general fund. Reestimates 
shall be displayed as a distinct and separately identified subaccount 
in the program account.
    ``(e) Administrative Expenses.--All funding for an agency's 
administration of a Federal insurance program shall be displayed as a 
distinct and separately identified subaccount in the program account.

``SEC. 603. TIMETABLE FOR IMPLEMENTATION OF ACCRUAL BUDGETING FOR 
                    FEDERAL INSURANCE PROGRAMS.

    ``(a) Agency Requirements.--Agencies with responsibility for 
Federal insurance programs shall develop models to estimate their risk-
assumed cost by year through the budget horizon and shall submit those 
models, all relevant data, a justification for critical assumptions, 
and the annual projected risk-assumed costs to OMB with their budget 
requests each year starting with the request for fiscal year 2002. 
Agencies will likewise provide OMB with annual estimates of 
modifications, if any, and reestimates of program costs.
    ``(b) Disclosure.--When the President submits a budget of the 
Government pursuant to section 1105(a) of title 31, United States Code, 
for fiscal year 2002, OMB shall publish a notice in the Federal 
Register advising interested persons of the availability of information 
describing the models, data (including sources), and critical 
assumptions (including explicit or implicit discount rate assumptions) 
that it or other executive branch entities would use to estimate the 
risk-assumed cost of Federal insurance programs and giving such persons 
an opportunity to submit comments. At the same time, the chairman of 
the Committee on the Budget shall publish a notice for CBO in the 
Federal Register advising interested persons of the availability of 
information describing the models, data (including sources), and 
critical assumptions (including explicit or implicit discount rate 
assumptions) that it would use to estimate the risk-assumed cost of 
Federal insurance programs and giving such interested persons an 
opportunity to submit comments.
    ``(c) Revision.--(1) After consideration of comments pursuant to 
subsection (b), and in consultation with the Committees on the Budget 
of the House of Representatives and the Senate, OMB and CBO shall 
revise the models, data, and major assumptions they would use to 
estimate the risk-assumed cost of Federal insurance programs.
    ``(2) When the President submits a budget of the Government 
pursuant to section 1105(a) of title 31, United States Code, for fiscal 
year 2003, OMB shall publish a notice in the Federal Register advising 
interested persons of the availability of information describing the 
models, data (including sources), and critical assumptions (including 
explicit or implicit discount rate assumptions) that it or other 
executive branch entities used to estimate the risk-assumed cost of 
Federal insurance programs.
    ``(d) Display.--
            ``(1) In general.--For fiscal years 2003, 2004, and 2005 
        the budget submissions of the President pursuant to section 
        1105(a) of title 31, United States Code, and CBO's reports on 
        the economic and budget outlook pursuant to section 202(e)(1) 
        and the President's budgets, shall for display purposes only, 
        estimate the risk-assumed cost of existing or proposed Federal 
        insurance programs.
            ``(2) OMB.--The display in the budget submissions of the 
        President for fiscal years 2003, 2004, and 2005 shall include--
                    ``(A) a presentation for each Federal insurance 
                program in budget-account level detail of estimates of 
                risk-assumed cost;
                    ``(B) a summary table of the risk-assumed costs of 
                Federal insurance programs; and
                    ``(C) an alternate summary table of budget 
                functions and aggregates using risk-assumed rather than 
                cash-based cost estimates for Federal insurance 
                programs.
            ``(3) CBO.--In the second session of the 107th Congress and 
        the 108th Congress, CBO shall include in its estimates under 
        section 308, for display purposes only, the risk-assumed cost 
        of existing Federal insurance programs, or legislation that 
        CBO, in consultation with the Committees on the Budget of the 
        House of Representatives and the Senate, determines would 
        create a new Federal insurance program.
    ``(e) OMB, CBO, and GAO Evaluations.--(1) Not later than 6 months 
after the budget submission of the President pursuant to section 
1105(a) of title 31, United States Code, for fiscal year 2005, OMB, 
CBO, and GAO shall each submit to the Committees on the Budget of the 
House of Representatives and the Senate a report that evaluates the 
advisability and appropriate implementation of this title.
    ``(2) Each report made pursuant to paragraph (1) shall address the 
following:
            ``(A) The adequacy of risk-assumed estimation models used 
        and alternative modeling methods.
            ``(B) The availability and reliability of data or 
        information necessary to carry out this title.
            ``(C) The appropriateness of the explicit or implicit 
        discount rate used in the various risk-assumed estimation 
        models.
            ``(D) The advisability of specifying a statutory discount 
        rate (such as the Treasury rate) for use in risk-assumed 
        estimation models.
            ``(E) The ability of OMB, CBO, or GAO, as applicable, to 
        secure any data or information directly from any Federal agency 
        necessary to enable it to carry out this title.
            ``(F) The relationship between risk-assumed accrual 
        budgeting for Federal insurance programs and the specific 
        requirements of the Balanced Budget and Emergency Deficit 
        Control Act of 1985.
            ``(G) Whether Federal budgeting is improved by the 
        inclusion of risk-assumed cost estimates for Federal insurance 
        programs.
            ``(H) The advisability of including each of the programs 
        currently estimated on a risk-assumed cost basis in the Federal 
        budget on that basis.

``SEC. 604. DEFINITIONS.

    ``For purposes of this title:
            ``(1) The term `Federal insurance program' means a program 
        that makes insurance commitments and includes the list of such 
        programs included in the joint explanatory statement of 
        managers accompanying the conference report on the 
        Comprehensive Budget Process Reform Act of 1999.
            ``(2) The term `insurance commitment' means an agreement in 
        advance by a Federal agency to indemnify a nonfederal entity 
        against specified losses. This term does not include loan 
        guarantees as defined in title V or benefit programs such as 
        social security, medicare, and similar existing social 
        insurance programs.
            ``(3)(A) The term `risk-assumed cost' means the net present 
        value of the estimated cash flows to and from the Government 
        resulting from an insurance commitment or modification thereof.
            ``(B) The cash flows associated with an insurance 
        commitment include--
                    ``(i) expected claims payments inherent in the 
                Government's commitment;
                    ``(ii) net premiums (expected premium collections 
                received from or on behalf of the insured less expected 
                administrative expenses);
                    ``(iii) expected recoveries; and
                    ``(iv) expected changes in claims, premiums, or 
                recoveries resulting from the exercise by the insured 
                of any option included in the insurance commitment.
            ``(C) The cost of a modification is the difference between 
        the current estimate of the net present value of the remaining 
        cash flows under the terms of the insurance commitment, and the 
        current estimate of the net present value of the remaining cash 
        flows under the terms of the insurance commitment as modified.
            ``(D) The cost of a reestimate is the difference between 
        the net present value of the amount currently required by the 
        financing account to pay estimated claims and other 
        expenditures and the amount currently available in the 
        financing account. The cost of a reestimate shall be accounted 
        for in the current year in the budget of the Government 
        pursuant to section 1105(a) of title 31, United States Code.
            ``(E) For purposes of this definition, expected 
        administrative expenses shall be construed as the amount 
        estimated to be necessary for the proper administration of the 
        insurance program. This amount may differ from amounts actually 
        appropriated or otherwise made available for the administration 
        of the program.
            ``(4) The term `program account' means the budget account 
        for the risk-assumed cost, and for paying all costs of 
        administering the insurance program, and is the account from 
        which the risk-assumed cost is disbursed to the financing 
        account.
            ``(5) The term `financing account' means the nonbudget 
        account that is associated with each program account which 
        receives payments from or makes payments to the program 
        account, receives premiums and other payments from the public, 
        pays insurance claims, and holds balances.
            ``(6) The term `modification' means any Government action 
        that alters the risk-assumed cost of an existing insurance 
        commitment from the current estimate of cash flows. This 
        includes any action resulting from new legislation, or from the 
        exercise of administrative discretion under existing law, that 
        directly or indirectly alters the estimated cost of existing 
        insurance commitments.
            ``(7) The term `model' means any actuarial, financial, 
        econometric, probabilistic, or other methodology used to 
        estimate the expected frequency and magnitude of loss-producing 
        events, expected premiums or collections from or on behalf of 
        the insured, expected recoveries, and administrative expenses.
            ``(8) The term `current' has the same meaning as in section 
        250(c)(9) of the Balanced Budget and Emergency Deficit Control 
        Act of 1985.
            ``(9) The term `OMB' means the Director of the Office of 
        Management and Budget.
            ``(10) The term `CBO' means the Director of the 
        Congressional Budget Office.
            ``(11) The term `GAO' means the Comptroller General of the 
        United States.

``SEC. 605. AUTHORIZATIONS TO ENTER INTO CONTRACTS; ACTUARIAL COST 
                    ACCOUNT.

    ``(a) Authorization of Appropriations.--There is authorized to be 
appropriated $600,000 for each of fiscal years 2000 through 2005 to the 
Director of the Office of Management and Budget and each agency 
responsible for administering a Federal program to carry out this 
title.
    ``(b) Treasury Transactions With the Financing Accounts.--The 
Secretary of the Treasury shall borrow from, receive from, lend to, or 
pay the insurance financing accounts such amounts as may be 
appropriate. The Secretary of the Treasury may prescribe forms and 
denominations, maturities, and terms and conditions for the 
transactions described above. The authorities described above shall not 
be construed to supersede or override the authority of the head of a 
Federal agency to administer and operate an insurance program. All the 
transactions provided in this subsection shall be subject to the 
provisions of subchapter II of chapter 15 of title 31, United States 
Code. Cash balances of the financing accounts in excess of current 
requirements shall be maintained in a form of uninvested funds, and the 
Secretary of the Treasury shall pay interest on these funds.
    ``(c) Appropriation of Amount Necessary To Cover Risk-Assumed Cost 
of Insurance Commitments at Transition Date.--(1) A financing account 
is established on September 30, 2005, for each Federal insurance 
program.
    ``(2) There is appropriated to each financing account the amount of 
the risk-assumed cost of Federal insurance commitments outstanding for 
that program as of the close of September 30, 2005.
    ``(3) These financing accounts shall be used in implementing the 
budget accounting required by this title.

``SEC. 606. EFFECTIVE DATE.

    ``(a) In General.--This title shall take effect immediately and 
shall expire on September 30, 2007.
    ``(b) Special Rule.--If this title is not reauthorized by September 
30, 2007, then the accounting structure and budgetary treatment of 
Federal insurance programs shall revert to the accounting structure and 
budgetary treatment in effect immediately before the date of enactment 
of this title.''.
    (b)  Conforming Amendment.--The table of contents set forth in 
section 1(b) of the Congressional Budget and Impoundment Control Act of 
1974 is amended by inserting after the item relating to section 507 the 
following new items:

     ``TITLE VI--BUDGETARY TREATMENT OF FEDERAL INSURANCE PROGRAMS

``Sec. 601. Short title.
``Sec. 602. Budgetary treatment.
``Sec. 603. Timetable for implementation of accrual budgeting for 
Federal insurance programs.
``Sec. 604. Definitions.
``Sec. 605. Authorizations to enter into contracts; actuarial cost 
account.
``Sec. 606. Effective date.''.

           Subtitle B--Reports on Long-Term Budgetary Trends

SEC. 521. REPORTS ON LONG-TERM BUDGETARY TRENDS.

    (a) The President's Budget.--Section 1105(a) of title 31, United 
States Code (as amended by section 404), is further amended by adding 
at the end the following new paragraph:
            ``(34) an analysis based upon current law and an analysis 
        based upon the policy assumptions underlying the budget 
        submission for every fifth year of the period of 75 fiscal 
        years beginning with such fiscal year, of the estimated levels 
        of total new budget authority and total budget outlays, 
        estimated revenues, estimated surpluses and deficits, and, for 
        social security, medicare, medicaid, and all other direct 
        spending, estimated levels of total new budget authority and 
        total budget outlays; and a specification of its underlying 
        assumptions and a sensitivity analysis of factors that have a 
        significant effect on the projections made in each analysis; 
        and a comparison of the effects of each of the two analyses on 
        the economy, including such factors as inflation, foreign 
        investment, interest rates, and economic growth.''.
    (b) CBO Reports.--Section 202(e)(1) of the Congressional Budget Act 
of 1974 is amended by adding at the end the following new sentences: 
``Such report shall also include an analysis based upon current law for 
every fifth year of the period of 75 fiscal years beginning with such 
fiscal year, of the estimated levels of total new budget authority and 
total budget outlays, estimated revenues, estimated surpluses and 
deficits, and, for social security, medicare, medicaid, and all other 
direct spending, estimated levels of total new budget authority and 
total budget outlays. The report described in the preceding sentence 
shall also specify its underlying assumptions and set forth a 
sensitivity analysis of factors that have a significant effect on the 
projections made in the report.''.

              TITLE VI--BASELINES, BYRD RULE, AND LOCK-BOX

SEC. 601. PURPOSE.

The purposes of this title are to--
            (1) require budgetary comparisons to prior year levels;
            (2) restrict the application of the Byrd rule to measures 
        other than conference reports; and
            (3) establish a procedure to allow savings from spending 
        cuts in appropriation measures to be locked-in to increase the 
        surplus or reduce the deficit.

                        Subtitle A--The Baseline

SEC. 611. THE PRESIDENT'S BUDGET.

    (a) Paragraph (5) of section 1105(a) of title 31, United States 
Code, is amended to read as follows:
            ``(5) except as provided in subsection (b) of this section, 
        estimated expenditures and appropriations for the current year 
        and estimated expenditures and proposed appropriations the 
        President decides are necessary to support the Government in 
        the fiscal year for which the budget is submitted and the 4 
        fiscal years following that year, and, except for detailed 
        budget estimates, the percentage change from the current year 
        to the fiscal year for which the budget is submitted for 
        estimated expenditures and for appropriations.''.
    (b) Section 1105(a)(6) of title 31, United States Code, is amended 
to read as follows:
            ``(6) estimated receipts of the Government in the current 
        year and the fiscal year for which the budget is submitted and 
        the 4 fiscal years after that year under--
                    ``(A) laws in effect when the budget is submitted; 
                and
                    ``(B) proposals in the budget to increase revenues,
        and the percentage change (in the case of each category 
        referred to in subparagraphs (A) and (B)) between the current 
        year and the fiscal year for which the budget is submitted and 
        between the current year and each of the 9 fiscal years after 
        the fiscal year for which the budget is submitted.''.
    (c) Section 1105(a)(12) of title 31, United States Code, is amended 
to read as follows:
            ``(12) for each proposal in the budget for legislation that 
        would establish or expand a Government activity or function, a 
        table showing--
                    ``(A) the amount proposed in the budget for 
                appropriation and for expenditure because of the 
                proposal in the fiscal year for which the budget is 
                submitted;
                    ``(B) the estimated appropriation required because 
                of the proposal for each of the 4 fiscal years after 
                that year that the proposal will be in effect; and
                    ``(C) the estimated amount for the same activity or 
                function, if any, in the current fiscal year,
        and, except for detailed budget estimates, the percentage 
        change (in the case of each category referred to in 
        subparagraphs (A), (B), and (C)) between the current year and 
        the fiscal year for which the budget is submitted.''.
    (d) Section 1105(a)(18) of title 31, United States Code, is amended 
by inserting ``new budget authority and'' before ``budget outlays''.
    (e) Section 1105(a) of title 31, United States Code, (as amended by 
sections 412(b) and 521(a)) is further amended by adding at the end the 
following new paragraphs:
            ``(35) a comparison of levels of estimated expenditures and 
        proposed appropriations for each function and subfunction in 
        the current fiscal year and the fiscal year for which the 
        budget is submitted, along with the proposed increase or 
        decrease of spending in percentage terms for each function and 
        subfunction.
            ``(36) a table on sources of growth in total direct 
        spending under current law and as proposed in this budget 
        submission for the budget year and the ensuing 9 fiscal years, 
        which shall include changes in outlays attributable to the 
        following: cost-of-living adjustments; changes in the number of 
        program recipients; increases in medical care prices, 
        utilization and intensity of medical care; and residual 
        factors.''.
    (f) Section 1109(a) of title 31, United States Code, is amended by 
inserting after the first sentence the following new sentence: ``For 
discretionary spending, these estimates shall assume the levels set 
forth in the discretionary spending limits under section 251(c) of the 
Balanced Budget and Emergency Deficit Control Act of 1985, as adjusted, 
for the appropriate fiscal years (and if no such limits are in effect, 
these estimates shall assume the adjusted levels for the most recent 
fiscal year for which such levels were in effect).''.

SEC. 612. THE CONGRESSIONAL BUDGET.

    Section 301(e) of the Congressional Budget Act of 1974 (as amended 
by section 103) is further amended--
            (1) in paragraph (1), by inserting at the end the 
        following: ``The basis of deliberations in developing such 
        joint resolution shall be the estimated budgetary levels for 
        the preceding fiscal year. Any budgetary levels pending before 
        the committee and the text of the joint resolution shall be 
        accompanied by a document comparing such levels or such text to 
        the estimated levels of the prior fiscal year. Any amendment 
        offered in the committee that changes a budgetary level and is 
        based upon a specific policy assumption for a program, project, 
        or activity shall be accompanied by a document indicating the 
        estimated amount for such program, project, or activity in the 
        current year.''; and
            (2) in paragraph (2), by striking ``and'' at the end of 
        subparagraph (H) (as redesignated), by striking the period and 
        inserting ``; and'' at the end of subparagraph (I) (as 
        redesignated), and by adding at the end the following new 
        subparagraph:
                    ``(J) a comparison of levels for the current fiscal 
                year with proposed spending and revenue levels for the 
                subsequent fiscal years along with the proposed 
                increase or decrease of spending in percentage terms 
                for each function.''.

SEC. 613. CONGRESSIONAL BUDGET OFFICE REPORTS TO COMMITTEES.

    (a) The first sentence of section 202(e)(1) of the Congressional 
Budget Act of 1974 is amended by inserting ``compared to comparable 
levels for the current year'' before the comma at the end of 
subparagraph (A) and before the comma at the end of subparagraph (B).
    (b) Section 202(e)(1) of the Congressional Budget Act of 1974 is 
amended by inserting after the first sentence the following new 
sentence: ``Such report shall also include a table on sources of 
spending growth in total direct spending for the budget year and the 
ensuing 4 fiscal years, which shall include changes in outlays 
attributable to the following: cost-of-living adjustments; changes in 
the number of program recipients; increases in medical care prices, 
utilization and intensity of medical care; and residual factors.''.
    (c) Section 308(a)(1)(B) of the Congressional Budget Act of 1974 is 
amended by inserting ``and shall include a comparison of those levels 
to comparable levels for the current fiscal year'' before ``if timely 
submitted''.

SEC. 614. OUTYEAR ASSUMPTIONS FOR DISCRETIONARY SPENDING.

    For purposes of chapter 11 of title 31 of the United States Code, 
or the Congressional Budget Act of 1974, unless otherwise expressly 
provided, in making budgetary projections for years for which there are 
no discretionary spending limits, the Director of the Office of 
Management and Budget and the Director of the Congressional Budget 
Office shall assume discretionary spending levels at the levels for the 
last fiscal year for which such levels were in effect.

                       Subtitle B--The Byrd Rule

SEC. 621. LIMITATION ON BYRD RULE.

    (a) Protection of Conference Reports.--Section 313 of the 
Congressional Budget Act of 1974 is amended--
            (1) in subsection (c), by striking ``and again upon the 
        submission of a conference report on such a reconciliation bill 
        or resolution,'';
            (2) by striking subsection (d);
            (3) by redesignating subsection (e) as subsection (d); and
            (4) in subsection (e), as redesignated--
                    (A) by striking ``, motion, or conference report'' 
                the first place it appears and inserting ``, or 
                motion''; and
                    (B) by striking ``, motion, or conference report'' 
                the second and third places it appears and inserting 
                ``or motion''.
    (b) Conforming Amendment.--The first sentence of section 312(e) of 
the Congressional Budget Act of 1974 is amended by inserting ``, except 
for section 313,'' after ``Act''.

              Subtitle C--Spending Accountability Lock-box

SEC. 631. SHORT TITLE.

    This subtitle may be cited as the ``Spending Accountability Lock-
box Act of 1999''.

SEC. 632. SPENDING ACCOUNTABILITY LOCK-BOX LEDGER.

    (a) Establishment of Ledger.--Title III of the Congressional Budget 
Act of 1974 (as amended by sections 104(c) and 206(a)) is further 
amended by adding after section 317 the following new section:
               ``spending accountability lock-box ledger
    ``Sec. 318. (a) Establishment of Ledger.--The chairman of the 
Committee on the Budget of the House of Representatives and the 
chairman on the Committee on the Budget of the Senate shall each 
maintain a ledger to be known as the `Spending Accountability Lock-box 
Ledger'. The Ledger shall be divided into entries corresponding to the 
subcommittees of the Committees on Appropriations. Each entry shall 
consist of three components: the `House Lock-box Balance'; the `Senate 
Lock-box Balance'; and the `Joint House-Senate Lock-box Balance'.
    ``(b) Components of Ledger.--Each component in an entry shall 
consist only of amounts credited to it under subsection (c). No entry 
of a negative amount shall be made.
    ``(c) Credit of Amounts to Ledger.--(1) In the House of 
Representatives or the Senate, whenever a Member offers an amendment to 
an appropriation bill to reduce new budget authority in any account, 
that Member may state the portion of such reduction that shall be--
            ``(A) credited to the House or Senate Lock-box Balance, as 
        applicable; or
            ``(B) used to offset an increase in new budget authority in 
        any other account;
            ``(C) allowed to remain within the applicable section 
        302(b) suballocation.
If no such statement is made, the amount of reduction in new budget 
authority resulting from the amendment shall be credited to the House 
or Senate Lock-box Balance, as applicable, if the amendment is agreed 
to.
    ``(2)(A) Except as provided by subparagraph (B), the chairmen of 
the Committees on the Budget shall, upon the engrossment of any 
appropriation bill by the House of Representatives and upon the 
engrossment of Senate amendments to that bill, credit to the applicable 
entry balance of that House amounts of new budget authority and outlays 
equal to the net amounts of reductions in new budget authority and in 
outlays resulting from amendments agreed to by that House to that bill.
    ``(B) When computing the net amounts of reductions in new budget 
authority and in outlays resulting from amendments agreed to by the 
House of Representatives or the Senate to an appropriation bill, the 
chairmen of the Committees on the Budget shall only count those 
portions of such amendments agreed to that were so designated by the 
Members offering such amendments as amounts to be credited to the House 
or Senate Lock-box Balance, as applicable, or that fall within the last 
sentence of paragraph (1).
    ``(3) The chairmen of the Committees on the Budget shall, upon the 
engrossment of Senate amendments to any appropriation bill, credit to 
the applicable Joint House-Senate Lock-box Balance the amounts of new 
budget authority and outlays equal to--
            ``(A) an amount equal to one-half of the sum of (i) the 
        amount of new budget authority in the House Lock-box Balance 
        plus (ii) the amount of new budget authority in the Senate 
        Lock-box Balance for that subcommittee; and
            ``(B) an amount equal to one-half of the sum of (i) the 
        amount of outlays in the House Lock-box Balance plus (ii) the 
        amount of outlays in the Senate Lock-box Balance for that 
        subcommittee.
    ``(4) Calculation of Lock-Box Savings in Senate.--For purposes of 
calculating under this section the net amounts of reductions in new 
budget authority and in outlays resulting from amendments agreed to by 
the Senate on an appropriation bill, the amendments reported to the 
Senate by its Committee on Appropriations shall be considered to be 
part of the original text of the bill.
    ``(d) Definition.--As used in this section, the term `appropriation 
bill' means any general or special appropriation bill, and any bill or 
joint resolution making supplemental, deficiency, or continuing 
appropriations through the end of a fiscal year.
    ``(e) Tally During House Consideration.--The chairman of the 
Committee on the Budget of the House of Representatives shall maintain 
a running tally of the amendments adopted reflecting increases and 
decreases of budget authority in the bill as reported. This tally shall 
be available to Members in the House of Representatives during 
consideration of any appropriations bill by the House.''.
    (b) Conforming Amendment.--The table of contents set forth in 
section 1(b) of the Congressional Budget and Impoundment Control Act of 
1974 is amended by inserting after the item relating to section 317 the 
following new item:

``Sec. 318. Spending accountability lock-box ledger.''.

SEC. 633. DOWNWARD ADJUSTMENT OF SECTION 302(A) ALLOCATIONS AND SECTION 
                    302(B) SUBALLOCATIONS.

    (a) Allocations.--Section 302(a) of the Congressional Budget Act of 
1974 (as amended by section 422) is further amended by adding at the 
end the following new paragraph:
            ``(6) Adjustment of allocations.--Upon the engrossment of 
        Senate amendments to any appropriation bill (as defined in 
        section 318(d)) for a fiscal year, the amounts allocated under 
        paragraph (1) to the Committee on Appropriations of each House 
        upon the adoption of the most recent joint resolution on the 
        budget for that fiscal year shall be adjusted downward by the 
        amounts credited to the applicable Joint House-Senate Lock-box 
        Balance under section 318(c)(2). The revised levels of new 
        budget authority and outlays shall be submitted to each House 
        by the chairman of the Committee on the Budget of that House 
        and shall be printed in the Congressional Record.''.
    (b) Suballocations.--Section 302(b) of the Congressional Budget Act 
of 1974 is amended by adding at the end the following new sentence: 
``Whenever an adjustment is made under subsection (a)(6) to an 
allocation under that subsection, the Committee on Appropriations of 
each House shall make downward adjustments in the most recent 
suballocations of new budget authority and outlays under this 
subparagraph to the appropriate subcommittees of that committee in the 
total amounts of those adjustments under section 318(c)(2). The revised 
suballocations shall be submitted to each House by the chairman of the 
Committee on Appropriations of that House and shall be printed in the 
Congressional Record.''.

SEC. 634. PERIODIC REPORTING OF LEDGER STATEMENTS.

    Section 308(b)(1) of the Congressional Budget Act of 1974 is 
amended by adding at the end the following new sentence: ``Such reports 
shall also include an up-to-date tabulation of the amounts contained in 
the ledger and each entry established by section 318(a).''.

SEC. 635. DOWNWARD ADJUSTMENT OF DISCRETIONARY SPENDING LIMITS.

    The discretionary spending limits for new budget authority and 
outlays for any fiscal year set forth in section 251(c) of the Balanced 
Budget and Emergency Deficit Control Act of 1985, shall be reduced by 
the amounts set forth in the final regular appropriation bill for that 
fiscal year or joint resolution making continuing appropriations 
through the end of that fiscal year. Those amounts shall be the sums of 
the Joint House-Senate Lock-box Balances for that fiscal year, as 
calculated under section 302(a)(6) of the Congressional Budget Act of 
1974. That bill or joint resolution shall contain the following 
statement of law: ``As required by section 635 of the Spending 
Accountability Lock-box Act of 1999, for fiscal year [insert 
appropriate fiscal year] and each outyear, the adjusted discretionary 
spending limit for new budget authority is reduced by $ [insert 
appropriate amount of reduction] and the adjusted discretionary limit 
for outlays is reduced by $ [insert appropriate amount of reduction] 
for the fiscal year and each outyear.''. Section 306 shall not apply to 
any bill or joint resolution because of such statement. This adjustment 
shall be reflected in reports under sections 254(f) and 254(g) of the 
Balanced Budget and Emergency Deficit Control Act of 1985.

              Subtitle D--Automatic Continuing Resolution

SEC. 641. AUTOMATIC CONTINUING RESOLUTION.

    (a) Amendment to Title 31.--Chapter 13 of title 31, United States 
Code, is amended by inserting after section 1310 the following new 
section:

``Sec. 1311. Continuing appropriations

    ``(a)(1) If any regular appropriation bill for a fiscal year does 
not become law prior to the beginning of such fiscal year and a joint 
resolution making continuing appropriations (other than pursuant to 
this subsection) is not in effect, there is appropriated, out of any 
moneys in the Treasury not otherwise appropriated, and out of 
applicable corporate or other revenues, receipts, and funds, such sums 
as may be necessary to continue any program, project, or activity for 
which funds were provided in the preceding fiscal year--
            ``(A) in the corresponding regular appropriation Act for 
        such preceding fiscal year; or
            ``(B) if the corresponding regular appropriation bill for 
        such preceding fiscal year did not become law, then in a joint 
        resolution making continuing appropriations for such preceding 
        fiscal year.
    ``(2)(A) Except as provided by subparagraphs (B), (C), and (D), 
appropriations and funds made available, and authority granted, for a 
program, project, or activity for any fiscal year pursuant to this 
section shall be at a rate of operations not in excess of the rate of 
operations provided for in the regular appropriation Act providing for 
such program, project, or activity for the preceding fiscal year, or in 
the absence of such an Act, the rate of operations provided for such 
program, project, or activity pursuant to a joint resolution making 
continuing appropriations for such preceding fiscal year.
    ``(B) The applicable rate of operations for a program, project, or 
activity for any fiscal year pursuant to this section shall exclude 
amounts--
            ``(i) for which any adjustment was made under section 
        251(b)(2)(A) or section 252(e) of the Balanced Budget and 
        Emergency Deficit Control Act of 1985 before the date of 
        enactment of this section;
            ``(ii) provided for emergencies for which an exemption from 
        section 251 or 252 of such Act is granted under section 317(c) 
        of the Congressional Budget Act of 1974; or
            ``(iii) for which any adjustment is made under section 
        251(b)(2)(C) or (D) of such Act.
    ``(C) The applicable rate of operations for a program, project, or 
activity for any fiscal year pursuant to this section shall be 
increased by the amount provided for such program, project, or activity 
in any supplemental or special appropriations Act for such fiscal year 
for such such program, project, or activity and shall be reduced by any 
amount rescinded for such such program, project, or activity in any 
rescission bill for that fiscal year that is enacted into law.
    ``(D) The applicable rate of operations for a program, project, or 
activity for any fiscal year pursuant to this section shall be reduced 
by the amount of budgetary resources cancelled in any such program, 
project, or activity resulting from the prior year's sequestration 
under section 251 of the Balanced Budget and Emergency Deficit Control 
Act of 1985 as published in OMB's final sequestration report for the 
prior fiscal year.
    ``(3) Appropriations and funds made available, and authority 
granted, for any fiscal year pursuant to this section for a program, 
project, or activity shall be available for the period beginning with 
the first day of a lapse in appropriations and ending with the earlier 
of--
            ``(A) the date on which the applicable regular 
        appropriation bill for such fiscal year becomes law (whether or 
        not such law provides for such program, project, or activity) 
        or a continuing resolution making appropriations becomes law, 
        as the case may be, or
            ``(B) the last day of such fiscal year.
    ``(b) An appropriation or funds made available, or authority 
granted, for a program, project, or activity for any fiscal year 
pursuant to this section shall be subject to the terms and conditions 
imposed with respect to the appropriation made or funds made available 
for the preceding fiscal year, or authority granted for such program, 
project, or activity under current law.
    ``(c) Appropriations and funds made available, and authority 
granted, for any program, project, or activity for any fiscal year 
pursuant to this section shall cover all obligations or expenditures 
incurred for such program, project, or activity during the portion of 
such fiscal year for which this section applies to such program, 
project, or activity.
    ``(d) Expenditures made for a program, project, or activity for any 
fiscal year pursuant to this section shall be charged to the applicable 
appropriation, fund, or authorization whenever a regular appropriation 
bill or a joint resolution making continuing appropriations until the 
end of a fiscal year providing for such program, project, or activity 
for such period becomes law.
    ``(e) This section shall not apply to a program, project, or 
activity during a fiscal year if any other provision of law (other than 
an authorization of appropriations)--
            ``(1) makes an appropriation, makes funds available, or 
        grants authority for such program, project, or activity to 
        continue for such period, or
            ``(2) specifically provides that no appropriation shall be 
        made, no funds shall be made available, or no authority shall 
        be granted for such program, project, or activity to continue 
        for such period; or
    ``(f) For purposes of this section, the term `regular appropriation 
bill' means any annual appropriation bill making appropriations, 
otherwise making funds available, or granting authority, for any of the 
following categories of programs, projects, and activities:
            ``(1) Agriculture, rural development, and related agencies 
        programs.
            ``(2) The Departments of Commerce, Justice, and State, the 
        judiciary, and related agencies.
            ``(3) The Department of Defense.
            ``(4) The government of the District of Columbia and other 
        activities chargeable in whole or in part against the revenues 
        of the District.
            ``(5) The Departments of Labor, Health and Human Services, 
        and Education, and related agencies.
            ``(6) The Department of Housing and Urban Development, and 
        sundry independent agencies, boards, commissions, corporations, 
        and offices.
            ``(7) Energy and water development.
            ``(8) Foreign assistance and related programs.
            ``(9) The Department of the Interior and related agencies.
            ``(10) Military construction.
            ``(11) The Department of Transportation and related 
        agencies.
            ``(12) The Treasury Department, the U.S. Postal Service, 
        the Executive Office of the President, and certain independent 
        agencies.
            ``(13) The legislative branch.''.
    (b) Conforming Amendment.--Section 202(e)(3) of the Congressional 
Budget Act of 1974 is amended by inserting ``and on or before September 
30'' before ``of each year''.
    (c) Chapter Analysis.--The analysis of chapter 13 of title 31, 
United States Code, is amended by inserting after the item relating to 
section 1310 the following new item:

``1311. Continuing appropriations.''.

    (d) Effect of Amendments.--Nothing in the amendments made by this 
section shall be construed to affect Government obligations mandated by 
other law, including obligations with respect to social security, 
medicare, and medicaid.

              TITLE VII--BUDGETING IN AN ERA OF SURPLUSES

SEC. 701. PAYGO REQUIREMENTS AND THE ON-BUDGET SURPLUS.

    (a) Section 252(a) of the Balanced Budget and Emergency Deficit 
Control Act of 1985 is amended to read as follows:
    ``(a) Purpose.--The purpose of this section is to trigger an 
offsetting sequestration in the amount by which any excess of decreases 
in receipts and increases in direct spending over increases in receipts 
and decreases in direct spending, caused by all direct spending and 
receipts legislation enacted prior to October 1, 2002, exceeds 
estimates of the on-budget surplus.''.
    (b) Timing and Calculation of Sequestration.--Section 252(b) of the 
Balanced Budget and Emergency Deficit Control Act of 1985 is amended to 
read as follows:
    ``(b) Sequestration.--
            ``(1) Timing.--Not later than 15 calendar days after the 
        date Congress adjourns to end a session and on the same day as 
        a sequestration (if any) under section 251, there shall be a 
        sequestration to offset an amount equal to--
                    ``(A) any excess of decreases in receipts and 
                increases in direct spending over increases in receipts 
                and decreases in direct spending for legislation 
                enacted prior to October 1, 2002; minus
                    ``(B) the estimated on-budget surplus,
        as calculated under paragraph (2) (which shall not be less than 
        zero).
            ``(2) Calculation of sequestration.--OMB shall calculate 
        the amount of the sequestration by adding--
                    ``(A) all OMB estimates for the budget year of 
                direct spending and receipts legislation transmitted 
                under subsection (d) for legislation enacted prior to 
                October 1, 2002;
                    ``(B) the estimated amount of savings in direct 
                spending programs applicable to the budget year 
                resulting from the prior year's sequestration under 
                this section, if any, as published in OMB's final 
                sequestration report for that prior year; and
                    ``(C) all OMB estimates for the current year that 
                were not reflected in the final OMB sequestration 
                report for that year; and
        then by subtracting from such sum the OMB estimate for the 
        budget year of the on-budget surplus (if any) as set forth in 
        the OMB final sequestration report increased by the amount of 
        budgetary resources cancelled in any such program, project, or 
        activity resulting from a sequestration for the budget year on 
        the same day under section 251 as published in OMB's final 
        sequestration report.''.
    (c) Preview Reports.--Section 254(c)(3) of the Balanced Budget and 
Emergency Deficit Control Act of 1985 is amended by redesignating 
subparagraph (C) as subparagraph (D) and by adding after subparagraph 
(B) the following new subparagraph:
                    ``(C)(i) Mandatory.--In projecting the on-budget 
                surplus (if any) for the budget year, direct spending 
                and receipts shall be calculated consistent with the 
                assumptions under section 257(b) but shall exclude all 
                estimates of direct spending and receipts legislation 
                for such year enacted after the date of enactment of 
                this subparagraph (as estimated by OMB when such 
                legislation was originally enacted).
                    ``(ii) Discretionary.--Except as provided by the 
                preceding sentence, the following assumptions shall 
                apply to the calculation of such estimated surplus:
                            ``(I) For programs, projects, and 
                        activities for which a regular appropriation 
                        Act or a joint resolution (other than pursuant 
                        to section 1311 of title 31, United States 
                        Code) continuing appropriations through the end 
                        of the budget year is enacted, budgetary 
                        resources other than unobligated balances shall 
                        be at the level provided by that Act with the 
                        following adjustments:
                                    ``(aa) Include amounts of budget 
                                authority provided and rescinded for 
                                such year in any supplemental or 
                                special appropriation Act or rescission 
                                bill that is enacted into law.
                                    ``(bb) Reduce the level by the 
                                amount of budgetary resources canceled 
                                in any such program, project, or 
                                activity by a sequestration under 
                                section 251 as published in OMB's final 
                                sequestration report for such year.
                        Substantive changes to or restrictions on 
                        entitlement law or other mandatory spending law 
                        in an appropriation Act shall be counted in 
                        determining the level of direct spending and 
                        receipts for purposes of calculating the on-
                        budget surplus under this section.
                            ``(II) For programs, projects, and 
                        activities for which a regular appropriation 
                        Act or a joint resolution (other than pursuant 
                        to section 1311 of title 31, United States 
                        Code) continuing appropriations through the end 
                        of the budget year is not enacted, budgetary 
                        resources other than unobligated balances shall 
                        be at the level provided for the current year 
                        in regular appropriation Acts or a joint 
                        resolution (other than pursuant to section 1311 
                        of title 31, United States Code) continuing 
                        appropriations through the end of the current 
                        year with the following adjustments:
                                    ``(aa) Include amounts of budget 
                                authority provided and rescinded for 
                                such year in any supplemental or 
                                special appropriation Act or rescission 
                                bill that is enacted into law.
                                    ``(bb) Reduce the level by the 
                                amount of budgetary resources canceled 
                                in any such program, project, or 
                                activity by a sequestration under 
                                section 251 as published in OMB's final 
                                sequestration report for such year.
                        Substantive changes to or restrictions on 
                        entitlement law or other mandatory spending law 
                        in an appropriation Act shall be counted in 
                        determining the level of direct spending and 
                        receipts for purposes of calculating the on-
                        budget surplus under this section. After making 
                        such adjustments, further adjust such amount 
                        using the assumptions set forth in section 
                        257(c)(1)-(5).
    (d) Definition of On-budget Surplus.--Section 250(c) of the 
Balanced Budget and Emergency Deficit Control Act of 1985 is amended by 
adding at the end the following new paragraph:
            ``(20) The term `on-budget surplus' means, with respect to 
        a fiscal year, the amount by which receipts exceed outlays for 
        all spending and receipt accounts of the United States 
        Government that are designated as on-budget. Such term does not 
        include outlays and receipts of the Federal Old-Age and 
        Survivors Insurance Trust Fund, the Federal Disability 
        Insurance Trust Fund, or any other off-budget entity.''.
    (e) Expedited Reconciliation Process.--Section 258C of the Balanced 
Budget and Emergency Deficit Control Act of 1985 is amended as follows:
            (1) The side heading of subsection (a) is amended by 
        inserting ``or in the House of Representatives'' after 
        ``Senate''.
            (2) In paragraphs (1), (2), (3), and (4) of subsection (a), 
        insert ``or House'' after ``Senate'' each place it appears.
            (3) In subsection (a)(7), strike ``For'' and insert ``In 
        the Senate, for''.
            (4) In subsection (b)(1), insert ``or House'' after 
        ``Senate''.
            (5) In the side heading of subsection (b)(4), insert 
        ``other'' after ``the''.
            (6) In subsection (b)(4), strike ``in the Senate from the 
        House'' and insert ``in the Senate or House of Representatives 
        from the other House'', strike ``Senate'' the second place it 
        appears and insert ``Senate or House of Representatives, as the 
        case may be,'', and strike ``Senate'' the third place it 
        appears and insert ``in the applicable House''.
                              Introduction

                              ----------                              


    This legislation is the product of two partnerships that 
began in the 105th Congress.
    The first is that of majority and minority Members of the 
House. While holding fast to their own principles, these 
participants shared a conviction that the budget process needed 
reform--reform that would meet the concerns of both political 
parties. The Budget Committee's task force on budget process 
reform--co-chaired by Representatives Jim Nussle of Iowa and 
Benjamin L. Cardin of Maryland--was emblematic of this 
bipartisan approach.
    The second critical partnership was that of two key House 
committees: the Committee on the Budget and the Committee on 
Rules. Both have fundamental interests in the budget process, 
but significantly different roles and perspectives. Throughout 
the development of this legislation, members of both committees 
sought common ground that would meet their respective 
jurisdictional concerns. A key member of this partnership was 
Representative Porter J. Goss, Chairman of the House Rules 
Subcommittee on Legislative and Budget Process.
    Budgetary procedures cannot, by themselves, yield better 
budgets. Only elected policymakers, acting responsibly and on 
principle, can do that.
    But the framework of the process does significantly affect 
the nature of the annual budget debate--and therefore its 
outcome. Properly fashioned, the process should promote 
consensus, responsibility, accountability, and discipline. It 
is, after all, the means by which policymakers handle trillions 
of dollars of someone else's money.
    This bipartisan plan amends the Congressional Budget and 
Impoundment Control Act of 1974 in the following ways:

- By giving the budget the force of law, and promoting 
    consensus rather than conflict in the development of 
    budgetary priorities.

- By budgeting up front for emergencies.

- By strengthening the enforcement of budgetary decisions.

- By enhancing accountability for government spending.

- By addressing the long-term implications of the government's 
    budgetary decisions.

- By mitigating the biases in the process toward higher 
    spending.

- By modifying budgetary requirements to meet the new era of 
    surpluses rather than deficits.

    The Federal Government's budgetary practices have evolved 
throughout the century. Some of the changes have proved durable 
and beneficial. Others have not. This act seeks to maintain the 
framework of the budget process but correct its weaknesses. As 
the Nation stands on the threshold of a new century, this 
legislation should be enacted--to promote consensus, 
responsibility, accountability, and discipline in the way the 
Federal Government handles the public's money.
                             Short Summary

                              ----------                              


                    TITLE I--JOINT BUDGET RESOLUTION

    Title I converts the concurrent budget resolution as an 
exercise of Congressional rulemaking into a joint resolution 
that is submitted to the President for his or her signature or 
veto. In the event the Congress and the President are not able 
to agree to a budget resolution, the Congress is permitted to 
move a concurrent resolution under expedited procedures.
    Significant changes are made in the content of the budget 
resolution. The 20 budget functions, across which proposed 
spending levels are distributed, are replaced by four broad 
spending categories. Any provision not specifically sanctioned 
by the Budget Act subjects the entire budget resolution to a 
point of order that would preclude its consideration. Moreover, 
the resolution would be denied the expedited procedures 
accorded to reconciliation bills.
    To increase pressure on Congress to complete a budget 
resolution, title I repeals a series of exceptions that allow 
tax and spending bills to be considered in the absence of a 
budget resolution.

                 TITLE II--RESERVE FUND FOR EMERGENCIES

    Title II replaces existing procedures for adjusting the 
appropriate levels in the the budget resolution and 
discretionary spending limits for amounts designated for an 
emergency with the codification of the definition for an 
emergency and a reserve fund for emergencies.
    An emergency is defined as an unanticipated situation that 
requires new budget authority and outlays for the preservation 
of life, property, or national security. ``Unanticipated'' is 
further defined as sudden, urgent, unforeseen and temporary. In 
addition, the Budget Committees are required to develop 
guidelines for applying the definition to specific bills.
    The President's budget submission, the budget resolution, 
and any discretionary spending limits that may be in effect are 
required to assume an amount for emergencies. This amount is 
initially withheld from the Appropriation Committee's 
allocations. The allocations are then increased on a bill-by-
bill basis if the Budget Committee determines the amounts 
provided in the bill are for legitimate emergencies. If a bill 
is reported that exceeds the amount remaining in the reserve 
fund, then the bill is referred to the Budget Committee before 
it may be considered on the floor.

             TITLE III--ENFORCEMENT OF BUDGETARY DECISIONS

    Title III provides procedures to enhance enforcement of the 
budget resolution. Subtitle A extends to nonreported bills 
restrictions against considering bills before the budget 
resolution is agreed to or bills in excess of the levels 
established by the budget resolution. Subtitle B requires any 
committee reporting a bill to include a statement from the 
Budget Committee as to whether it complies with the budget 
resolution. Similarly, subtitle C requires the Rules Committee 
to justify, in its accompanying report, any rule that waives 
any section of the Budget Act. Finally, subtitle D requires 
that the Congressional Budget Office [CBO] score conference 
reports and that the estimate be included in the appropriate 
reports.

             TITLE IV--ACCOUNTABILITY FOR FEDERAL SPENDING

    Title IV establishes new procedures to enhance 
accountability for Federal spending that replace the existing 
procedures set forth in the Budget Act. Subtitle A requires 
each committee to submit a schedule for reauthoriz ing, within 
10 years, all programs within its jurisdiction. Subtitle B 
establishes a point of order against any bill that authorizes a 
new program for a period in excess of 10 years.
    Subtitle A also prohibits the House from waiving certain 
amendments that would subject proposed new entitlements to 
annual appropriations. To further facilitate such amendments, 
it provides for an automatic increase in the Appropriations 
Committee's allocations and the discretionary spending limits 
for any bill that authorizes a new discretionary program and 
offsets it with mandatory savings.
    Subtitle B also requires the Budget Committee periodically 
to report on certain budget process reforms; the Appropriations 
and authorization committees to report on bills that breach the 
budget resolution; and the General Accounting Office [GAO] to 
provide an inventory of mandatory programs.
    Subtitle C requires CBO to prepare cost estimates covering 
a 10-year period. Finally, subtitle C repeals House Rule XXIII, 
which enables the House to pass a bill increasing the statutory 
limit on the public debt without having to vote on it.

              TITLE V--BUDGETING FOR UNFUNDED LIABILITIES

    Title V focuses on long-term obligations that generally are 
not captured in the short-term window of the budget. Subtitle A 
provides for a 6-year transition for Federal insurance programs 
from a cash basis to a risk-assumed basis. Risk-assumed 
budgeting, which is similar to the budgetary treatment of 
direct loans and loan guarantees, captures the unsubsidized 
financial liabilities for these programs that are borne by 
taxpayers rather than the short-term cash flows.
    Subtitle B builds into the budget process periodic reports 
on long-term budgetary projections. These projections are based 
on both current law and assumed policies in the President's 
budget. They focus on overall spending, revenue, and surplus or 
deficit levels, as well as projected levels for major 
entitlements.

  TITLE VI--BASELINES, BYRD RULE, LOCK-BOX, AND AUTOMATIC CONTINUING 
                               RESOLUTION

    Subtitle A stipulates that estimates of all budgetary 
proposals include comparisons to the comparable levels of the 
prior year. It further provides that for any outyear in which 
there are no discretionary spending caps in effect, 
discretionary spending should be held at a level consistent 
with the caps the last year in which they were in effect.
    Subtitle B restricts the application of the so-called Byrd 
rule, which enables 40 Members of the Senate to strip from 
reconciliation bills provi sions that they deem extraneous. The 
restriction allows the Byrd rule to apply only to Senate-passed 
reconciliation bills.
    Subtitle C establishes procedures for the sponsors of floor 
amendments to appropriations bills to dedicate any savings from 
their amendments to reduce total discretionary spending and 
thereby increase the surplus or reduce the deficit. The sponsor 
of any amendment can indicate whether the savings from the 
amendment go to the lock-box, to another program, project, or 
activity in the same bill, or to unspecified needs in another 
appropriations bill. The appropriate levels in the budget 
resolution and the discretionary spending limits, if any, are 
reduced by the amount dedicated to the lock-box.
    Subtitle D provides automatic continuing appropriations for 
any discretionary program, project, or activity for which an 
appropriation is not provided by the beginning of the fiscal 
year. The appropriation is at the prior year's level.

                     TITLE VII--PAYGO REQUIREMENTS

    Title VII modifies pay-as-you-go [PAYGO] requirements, 
which require offsets for legislation that cut taxes or 
increase entitlement spending. As modified by this title, 
Congress and the President would be permitted on a bill-by-bill 
basis to decide whether to offset tax cuts and entitlement 
initiatives when there is an on-budget surplus (i.e. when the 
sum of all non-Social Security revenue exceeds the sum of all 
non-Social Security outlays). Nevertheless, offsets would be 
required for any enacted legislation that would otherwise 
increase the on-budget deficit, implicitly using the surpluses 
in the Social Security trust funds. If for any fiscal year in 
which PAYGO is in effect, the sum of all revenue and direct 
spending bills exceeds the on-budget surplus, there would be a 
sequester in the amount of the difference. In determining the 
amount of any sequester, OMB would used an updated estimate of 
the on-budget surplus.
                         Background and Purpose

                              ----------                              


                 TITLE I--BUDGET WITH THE FORCE OF LAW

    Current Law. Under current law, Congress and the President 
have their own vehicles for establishing overall budgetary 
priorities, but no institutional means of reaching agreement 
between the two branches. The Budget and Accounting Act of 1921 
(Public Law 67-13, 42 Stat. 20), requires the President to 
annually submit a budget for the U.S. Government. By law, the 
budget submission must contain detailed information for each 
agency, including budget requests for individual programs and 
appropriations accounts, the text of proposed appropriations 
language, and descriptions of legislative proposals. The 
submission also includes historical tables, performance plans 
and data, the President's budget message, and other summary 
tables and descriptive information on the administration's 
proposals.
    The President's budget has no legal force: it is simply a 
statement of the President's budget priorities. The Congress is 
free to adopt, ignore, or revise these priorities as it 
considers its own budget resolution, the appropriations bills, 
and any tax or entitlement bills. But the administration budget 
does provide the basis for much of congressional deliberations 
on subsequent spending and tax bills.
    Until the Congressional Budget and Impoundment Control Act 
of 1974 (Public Law 93-344, 80 Stat. 297) was enacted, the 
Congress had no means of establishing its own budgetary 
priorities comparable to the President's budget submission. In 
a post-Watergate effort to enhance the congressional role in 
the budget process, the Budget Act required the Congress each 
year to adopt a concurrent resolution on the budget. This 
resolution sets the broad budgetary parameters for subsequent 
spending and tax legislation. As a concurrent resolution, the 
congressional budget is not presented to the President; hence 
it does not have the force of law. Rather, it is a vehicle that 
establishes rules and procedures that are binding only on the 
Congress.
    In contrast to the detail of the President's budget 
submission, the congressional budget resolution focuses on the 
broad spending and revenue aggregates, rather than specific 
programmatic funding levels or policy issues. It establishes 
spending and revenue levels as well as the resulting level of 
the debt or surplus. It distributes the recommended spending 
levels across 20 broad categories of Federal spending, known as 
budget functions [see Table 1]. The resolution may also include 
binding reconciliation directives to the authorizing committees 
to report tax and entitlement legislation that can achieve 
specified revenue and spending targets. In the report 
accompanying the resolution, any new spending authority assumed 
in the resolution is allocated to the appropriate committees of 
jurisdiction.

                            TABLE 1.--CURRENT FORMAT OF CONCURRENT BUDGET RESOLUTION
----------------------------------------------------------------------------------------------------------------
                                                              2000     2001     2002     2003     2004     2005
----------------------------------------------------------------------------------------------------------------
BUDGET AGGREGATES
 Total Spending...............................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
Revenues.....................................               .......  .......  .......  .......  .......  .......
Change in revenue............................               .......  .......  .......  .......  .......  .......
Deficit/Surplus..............................               .......  .......  .......  .......  .......  .......
Debt subject to limits.......................               .......  .......  .......  .......  .......  .......
BUDGET FUNCTIONS

050: National Defense........................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
150: International Affairs...................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
250: Science, Space, and Technology..........        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
270 Energy...................................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
300: Natural Resources and Environment.......        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
350: Agriculture.............................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
370: Commerce and Housing Credit.............        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
400: Transportation..........................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
450: Community and Regional Development......        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
500: Education, Training, Employment, and            BA     .......  .......  .......  .......  .......  .......
 Social Services.............................
                                                     OT     .......  .......  .......  .......  .......  .......
550: Health..................................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
570: Medicare................................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
600: Income Security.........................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
650: Social Security.........................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
700: Veterans Benefits and Services..........        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
750: Administration of Justice...............        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
800: General Government......................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
900: Net Interest............................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
920: Allowances..............................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
950: Undistributed Offsetting Receipts.......        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
----------------------------------------------------------------------------------------------------------------

    It is important to note that only the budget aggregates and 
the allocations in the accompanying report are binding on 
Congress when it considers subsequent spending and tax 
legislation. The functional levels are entirely advisory and 
are largely ignored by the spending and tax committees. In the 
House, a simple majority routinely waives these requirements 
before the consideration of most legislation. In the Senate, 
these requirements are waived only if a point of order is 
raised and only if the waiver is agreed to by three-fifths of 
the Senate.

    Summary of Proposal. This title establishes a regular 
process for Congress and the President to reach agreement on 
overall budget priorities, by converting the concurrent budget 
resolution into a joint resolution that becomes law if the 
President signs it or his veto is overridden by Congress. The 
contents of the resolution are simplified to focus negotiations 
on broad budgetary issues. A fail-safe mechanism is included to 
allow the Congress to consider tax and spending bills on the 
basis of congressional priorities in the event the Congress and 
the President are unable to agree on a joint budget resolution. 
The figure below shows how this process would unfold.




    To focus deliberations on broad budgetary priorities, the 
20 budget functions are replaced with subtotals for mandatory 
and discretionary spending, with the discretionary further divided 
between defense and nondefense spending. As under current law, the 
joint resolution must also include the deficit or surplus 
levels, and the amount of any recommended revenue change. The 
resolution may include an increase in the statutory limit on 
the debt if submitted by the Committee on Ways and Means.
    The joint resolution format also contains a special 
category ``emergency'' spending. This is further described in 
the discussion under Title II. The format of the proposed joint 
resolution is displayed in Table 2.

                              TABLE 2.--PROPOSED FORMAT OF JOINT BUDGET RESOLUTION
----------------------------------------------------------------------------------------------------------------
                                                              2000     2001     2002     2003     2004     2005
----------------------------------------------------------------------------------------------------------------
BUDGET AGGREGATES

Total spending...............................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
Revenues.....................................               .......  .......  .......  .......  .......  .......
Change in revenue............................               .......  .......  .......  .......  .......  .......
Interest.....................................               .......  .......  .......  .......  .......  .......
Surplus/Deficit..............................               .......  .......  .......  .......  .......  .......
Debt subject to limits.......................               .......  .......  .......  .......  .......  .......

BY CATEGORY

Total direct spending........................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
Total discretionary spending.................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
    Defense spending.........................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
    Nondefense spending......................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
    Emergencies..............................        BA     .......  .......  .......  .......  .......  .......
                                                     OT     .......  .......  .......  .......  .......  .......
----------------------------------------------------------------------------------------------------------------

    The reconciliation directives are shifted from the 
legislative text of the budget resolution to the House and 
Senate reports, or to the joint explanatory statement of the 
managers. This preserves Congress's ability to decide which 
committees should be directed to achieve spending and revenue 
targets.
    To ensure the resolution does not become a vehicle making 
programmatic and policy changes that are outside the 
jurisdiction of the House and Senate Budget Committees, the 
process reform bill provides that the resolution is subject to 
a point of order and loses its status as a budget resolution if 
it contains any nonsanctioned item. In the Senate, any 
extraneous provision would deprive the resolution of its 
protection from filibusters or unlimited amendments.
    In the event of protracted stalemate on the budget 
resolution, a fallback procedure allows the Congress to move 
tax and appropriations bills on the basis of its own 
priorities. If a joint resolution is vetoed, then the Congress 
can quickly consider a concurrent resolution under expedited 
procedures. This resolution may establish the same or different 
spending and revenue levels than the vetoed budget resolution. 
The Budget Committee chairman can introduce a concurrent 
resolution within 5 days after the bill has been vetoed. If the 
Budget Committee does not report the resolution within 5 days, 
it is discharged and available for floor consideration.

    Purpose of Proposed Change. A joint budget resolution 
procedure will change the underlying presumption of the budget 
process from conflict to consensus. Currently the process 
promotes conflict because Congress and the President propose 
their own budgets and are not required to agree on a common set 
of budget priorities. There is no institutional framework that 
presupposes a budget agreement, so any agreements that do occur 
are ad hoc. The two branches tend to use their respective 
budgets to differentiate their priorities from one another.
    In a sense, the players do not even share the same field 
when the budget process begins. Because it has no legislative 
weight, the President's budget--even with all its extensive 
detail--often becomes principally an instrument of public 
relations. By contrast, the congressional budget resolution is 
a framework for legislative activity--specifically 
appropriations bills and, if necessary, reconciliation 
legislation. The President has no commensurate role until the 
end--and then typically in piecemeal fashion, signing or 
vetoing the various spending, entitlement, and tax bills that 
reach the White House one by one. It is a formula for 
legislative friction--and for dismantling, brick by brick, any 
comprehensive view of governing that either side might try to 
embrace in an overall budget blueprint.
    A joint resolution places both Congress and the President 
on the same playing field, by drawing both into an action that 
expresses their constitutional roles in governing. The 
President may sign the resolution or refuse to sign it--but 
either choice is an exercise of the President's executive 
power. In that respect, the President's decision is 
commensurate with that of House and Senate Members, who 
exercise their legislative power by voting on the resolution.
    A joint resolution will draw the President into 
negotiations early in the year--rather than near the eve of a 
new fiscal year, when protracted disagreements can lead to a 
shutdown of government agencies (please also see Title VI). A 
joint resolution also would allow the President to help shape 
the blueprint that guides the 13 appropriations bills, as well 
as any entitlement or tax bills.
    The absence of such an approach has contributed to the 
nearly annual delays in the completion of Congress's budget 
work. In an era of divided government, the Congress devotes 
much of its time to considering spending and tax measures that 
are ultimately vetoed by the President. This is, after all, the 
President's principal means of expressing disagreement with 
Congress's budgetary priorities. With a joint resolution, the 
President could express these disagreements early, before the 
eve of the new fiscal year, and the potential shutdown of 
government agencies, bring undue pressure on the process.
    By bringing the President into the process earlier the 
joint resolution will also minimize conflict at the end of the 
process. If the President and Congress have already agreed on 
the total levels of defense and nondefense discretionary 
spending, conflict over the appropriations bills will be 
limited to determining how to divide up these levels across the 
13 appropriations subcommittees and the specific funding levels 
for individual programs. Similarly, if both sides have agreed 
to a tax cut of a certain size in the context of a joint 
resolution, the President is more likely to sign a tax bill 
consistent with the budget resolution.
    The stripped down structure of the joint resolution will 
focus policymakers' attention on the elements of the budget 
that are critical to reaching a budget agreement: the 
appropriate levels of the deficit or surplus, the total levels 
of revenue and spending, with spending broken down between 
mandatory and discretionary, and discretionary further broken 
down between defense and nondefense. These are the categories 
that have been incorporated in virtually every budget agreement 
since 1987 when there was divided government.
    In contrast to these broad categories, the budget functions 
in the concurrent resolution are neither relevant to subsequent 
stages of the budget process nor enforceable. A given budget 
function is a hybrid of mandatory and discretionary programs 
that span the jurisdictions of multiple authorizing and 
appropriations committees. The only enforceable elements are 
the budget aggregates and the allocations to the Appropriations 
and authorizing committees. These amounts are hidden in the 
report accompanying the budget resolution. Particularly in the 
area of discretionary spending, a major source of conflict over 
the budget resolution has been the distribution of 
discretionary spending across the various budget functions, 
even though the actual decisions are made during the 
appropriations process.
    The joint resolution will enhance the ability of both the 
Congress and the President to enforce the levels set forth in 
the budget resolution. Although the budget resolution levels 
will not be directly enforced by sequestration, their 
heightened visibility will make it difficult for Congress to 
pass, and the President sign, legislation that is inconsistent 
with these levels. Congress will retain the ability to enforce 
these levels with sequestration as part of reconciliation or 
other freestanding legislation.
    Above all, the public will be able more readily to 
understand a process in which there is a single budget for the 
U.S. Government, and in which Congress and the President use a 
lawmaking process to reach a budget agreement. Representatives 
in Congress and the White House must be held accountable by the 
citizens they represent; but accountability is possible only 
when the people can understand the significance of the 
decisions being made, and the roles of those who make them.

                 TITLE II--RESERVE FUND FOR EMERGENCIES

    Current Law. The current budgetary treatment of emergencies 
dates from the imposition of fixed limits on discretionary 
appropriations, and pay-as-you-go requirements for taxes and 
entitlements, in the Budget Enforcement Act of 1990 [BEA 90] 
(Public Law 101-508, 104 Stat. 1388, Stat. 573-628). Under the 
BEA 90, any item in an appropriations bill that is designated 
by both the Congress and the President as an emergency, in 
whole or in part, is exempt from the Appropriations Committee's 
allocation in the budget resolution; the aggregate spending 
levels established in the budget resolution; and the 
discretionary spending limits set forth in the Balanced Budget 
and Emergency Deficit Control Act. Similarly, any provision in 
a direct spending bill designated an emergency is not counted 
for purposes of determining whether the sum of all direct 
spending and receipt legislation increases the deficit.
    Usually the designation is included in the legislative text 
of an appropriations bill that provides the actual 
appropriation for the emergency and is considered to have been 
designated by the President upon enactment. In some cases, the 
Congress may designate a provision in the bill for 
congressional purposes only. The President is then free to sign 
these bills and designate all or none of the provisions as an 
emergency in subsequent releases of contingent emergency 
spending.
    The Budget Enforcement Act of 1990 imposed no limitations 
on emergency appropriations, other than to require that they be 
designated as such by both Congress and the President. There is 
no statutory definition of what constitutes an emergency. Nor 
are there specific, applicable criteria with which to determine 
whether a given appropriation or direct spending provision is a 
legitimate emergency. There is no limit on the amount that 
Congress and the President may designate as an emergency.
    Under section 258 of the Balanced Budget and Emergency 
Deficit Control Act, there are special procedures to suspend 
enforcement of both the discretionary spending limits and PAYGO 
requirements and the budget resolution's allocations and 
aggregates during an economic downturn or a war. In the case of 
an economic downturn, the Senate is required to consider, and 
the House may consider, a joint resolution that if adopted will 
suspend any sequestration under both the discretionary spending 
limits and PAYGO requirements and points of order under the 
budget resolution. In the case of a declaration of war, 
sequestration and points of order are automatically suspended.
    In the area of natural disasters, Public Law 102-229, the 
Desert Storm supplemental appropriations bill, specified that 
any amounts appropriated for the Stafford Act in excess of $320 
million were to be considered as ``emergency requirements'' 
under the discretionary spending limits. At the time, the $320-
million threshold represented the 10-year average obligational 
level of the Federal Emergency Management Agency [FEMA].
    The Balanced Budget Act of 1997 [BBA] continued to hold the 
budget resolution levels and the discretionary spending limits 
harmless for appropriations for designated emergencies, but 
changed the way in which the budget accounts for such spending. 
Instead of exempting designated amounts from the discretionary 
spending limits, the BBA stipulates that the discretionary 
spending limits are raised by the amount of the designated 
appropriation. Direct spending provisions designated as 
emergencies are exempt from PAYGO requirements (H.R. 2015, 
Public Law 105-33).
    According to Table 3, Congress and the President have 
enacted more than $146 billion in emergency-designated 
appropriations since statutory limits were first imposed on 
discretionary spending in 1990. Of this amount, $44 billion was 
for Operation Desert Storm, most of which was later reimbursed 
by the United States' allies in the conflict.

    TABLE 3.--EMERGENCIES IN REGULAR AND SUPPLEMENTAL APPROPRIATIONS
                          [Dollars in millions]
------------------------------------------------------------------------
                                                          Without Desert
               Fiscal year                                     Storm
------------------------------------------------------------------------
1991....................................         $45,846          $1,509
1992....................................          16,168          16,168
1993....................................           6,029           6,029
1994....................................          13,855          13,855
1995....................................           7,935           7,935
1996....................................           5,051           5,051
1997....................................           9,536           9,536
1998....................................           5,903           5,903
1999....................................          34,356          34,356
2000....................................           1,881           1,881
                                         -------------------------------
      Total.............................         146,560         102,223
------------------------------------------------------------------------

    Excluding Desert Storm, Congress and the President have 
enacted $102 billion in emergency spending since 1991.
    The distribution of outlays is shown in Table 4. Not 
surprisingly, the largest shares are for the Department of 
Defense and FEMA at 55 percent and 16 percent, respectively. 
The Department of Agriculture accounts for 10 percent of the 
total, with much of it coming in fiscal years 1992 and 1993. 
The Small Business Administration accounts for another 1 
percent. The rest is spread across a dozen agencies and Cabinet 
departments.

      TABLE 4.--DISTRIBUTION OF EMERGENCY APPROPRIATIONS BY AGENCY
                       [Fiscal year 1991 to 2000]
------------------------------------------------------------------------
                                            Dollars in
                 Agency                      millions         Percent
------------------------------------------------------------------------
Dept. of Defense (Military).............         $81,075             55%
Federal Emergency Management Agency.....          23,205             16%
Dept. of Agriculture....................          15,156             10%
Small Business Administration...........           2,167              1%
All Other...............................          24,957             17%
                                         -------------------------------
      Total.............................         146,560          100.0%
------------------------------------------------------------------------

    With one exception, the vast majority of emergency spending 
has been provided in supplemental appropriations, rather than 
in regular appropriations bills. Table 5 shows that between 
fiscal years 1991 and 1999, emergency spending in regular 
appropriation bills average less than 17 percent of the total, 
with a somewhat higher share in fiscal years 1994, 1995, and 
1997. For fiscal year 1999, however, most of the emergency 
spending was provided in a single, omnibus appropriations bill 
that encompassed 8 regular appropriation bills.

          TABLE 5.--DISTRIBUTION OF EMERGENCY SPENDING BETWEEN REGULAR AND SUPPLEMENTAL APPROPRIATIONS
                                              [Dollars in millions]
----------------------------------------------------------------------------------------------------------------
                                                                                                    Percent in
                           Fiscal year                                Regular      Supplemental    supplementals
----------------------------------------------------------------------------------------------------------------
1991............................................................          $1,000         $44,846             98%
1992............................................................             314          15,854             98%
1993............................................................             878           5,151             85%
1994............................................................           1,901          11,954             86%
1995............................................................           1,704           6,231             79%
1996............................................................             487           4,564             90%
1997............................................................           2,122           7,414             78%
1998............................................................             313           5,590             95%
1999............................................................          21,444          12,912             38%
                                                                 -----------------------------------------------
      Total.....................................................          30,163         114,516     Average=83%
----------------------------------------------------------------------------------------------------------------

    The intermittent nature of domestic emergencies is evident 
in the figure below, which shows supplemental spending for 
domestic emergencies as a percentage of discretionary spending. 
After peaking at a little over 2.5 percent in 1978, emergency 
spending declined to less than 0.5 percent between mid-1980 and 
the beginning of 1988. It then jumped up to 1.5 percent for 
Hurricane Hugo and the Loma Prieta earthquake in 1990; 4 
percent in 1992 for Hurricanes Andrew and Iniki, the Chicago 
flood, and the Los Angeles riots; then 5 percent in 1994 for 
the Northridge earthquake; and back down to 3 percent for the 
Dakota flooding in 1997. The 1999 omnibus bill provided 
emergency spending totaling more than 7 percent of total 
discretionary spending.

Figure 3.--Supplemental Spending for Disasters (1976-1990) and Domestic 
                     Emergency Spending (1991-2000)


    Source: Congressional Budget Office.

    Notes: The figure shows the disasters and emergencies that largely 
accounted for the spikes in spending. Pre-1991 data are from 
Congressional Budget Office, Supplemental Appropriations in the 1970s 
(July 1981), and Supplemental Appropriations in the 1980s (February 
1990). Post-1990 spending includes both regular and supplemental 
appropriations enacted as of June 3, 1999. All data exclude defense and 
international discretionary spending.

    Summary of Proposal. Title II fundamentally changes the 
budgetary treatment of emergency spending. These changes would 
apply to the congressional budget process, the discretionary 
spending limits, and PAYGO requirements. It would require both 
the budget resolution and the discretionary spending limits to 
assume a specified amount for emergencies, based on historical 
spending patterns. An objective definition of ``emergency'' 
would be written into the law. The amount in the budget 
resolution available for emergencies would be released on a 
bill-by-bill basis for those measures that provided funding for 
certified emergencies.
    The process for providing for emergencies is shown in the 
figure below:




    Both the President and Congress would be required to set 
aside an amount for emergencies. The amount would be equal to a 
5-year rolling average of appropriations for emergencies. The 
President would be required to include this amount in his 
budget submission. Congress would be required to assume the emergency 
amount in the budget resolution. The discretionary spending limits 
would assume a specified amount for emergencies.
    The bill codifies, for the first time, an objective yet 
broad definition of what constitutes an emergency. Drawing from 
a definition developed by the Office of Management and Budget 
[OMB] in 1991, Title II defines an emergency as a situation 
that:

          * * * requires new budget authority and outlays (or 
        new budget authority and the outlays flowing therefrom) 
        for the prevention or mitigation of, or response to, 
        loss of life or property, or a threat to national 
        security.

    The definition also requires that to qualify as an 
emergency, an event must be ``unanticipated''--meaning it is 
sudden, urgent, unforeseen, and temporary. It is important to 
note that both aspects of the definition must be present for a 
spending provision to qualify as an emergency.
    On the basis of this definition, the Budget Committee 
chairmen, working with the Office of Management and Budget and 
the appropriations and authorizing committees, are required to 
develop specific guidelines for determining whether 
appropriations for specific programs, projects, or activities 
are for emergencies based upon the above definition.
    The budget resolution would explicitly set forth an amount 
for emergencies. The amount would be initially withheld from 
the 302(a) allocations. In reporting a bill providing emergency 
spending, the Appropriations Committee would be required to 
include in the accompanying report a justification of why the 
appropriation qualifies as an emergency. The Budget Committee 
would then ascertain whether such an amount qualifies under the 
definition of ``emergency.'' The chairman would then adjust the 
allocations by the amount that the committee determined was for 
a legitimate emergency. For bills providing appropriations for 
multiple emergencies, if the Budget Committee determined that 
not all the items qualified, the committee would adjust the 
allocation only for the certified emergency amount.
    In the event of emergency funding that exceeds the reserve 
fund amounts, the procedure is as follows: The emergency 
spending bill is automatically referred to the Budget 
Committee. The Budget Committee may exempt some or all of the 
amount--the appropriation or, in the case of an authorization 
bill, direct spending provision--from the discretionary 
spending limits or, if appropriate, PAYGO requirements. The 
Budget Committee must report the bill within 5 legislative 
days, or the legislation is automatically discharged and placed 
on the calendar. If the Budget Committee reports the bill with 
an amendment exempting some or all of the bill from the 
discretionary spending limits or PAYGO requirements, then the 
Budget Committee chairman is required to make the appropriate 
adjustments in the discretionary spending limits, and 
aggregates.

    Purposes of Proposed Change. The main purposes of the 
proposed change in budgetary treatment of emergency spending 
are: first, to limit emergency funding to unanticipated 
situations in which there exists a threat to life, property, or 
national security; second, to anticipate funding needs for 
emergencies, and prevent the diversion of funds for emergency 
accounts to lower priority programs; third, to preserve 
Congress's ``power of the purse''; and fourth, to discourage 
the attachment of extraneous provisions to emergency 
supplemental appropriations bills.
    The procedures in this title provide reasonable assurance 
that spending that is purportedly for emergencies is, in fact, 
provided for legitimate emergencies. It reflects a consensus 
that emergencies arise from situations that are unanticipated 
and pose a threat to life, property, or national security. In 
the early years after OBRA90, Congress and the President more 
or less limited the emergency designation to legitimate 
emergencies. But the discipline began to break down in the mid-
1990's. In 1993, the House passed a $16.3-billion supplemental 
spending bill requested by the President. The Senate ultimately 
killed the supplemental, when it began to appear that much of 
the appropriation was focused on many of the President's core 
constituencies.
    In 1998, the emergency designation process virtually 
collapsed when the Congress and the President enacted an 
omnibus appropriations bill that encompassed eight of the 13 
regular appropriations bills. In addition to the $10.2 billion 
for repairing flood and hurricane damage, the bill contained 
$11.3 billion for what appeared to be important, but not 
unanticipated or life threatening, needs such as year 2000 
[Y2K] computer conversions, which received $3.35 billion in 
funding. Although the Y2K problem clearly posed a threat to 
intellectual property and needed to be accommodated in the 
budget, it was hardly unanticipated: the General Accounting 
Office [GAO] had been warning about it since as early as 1993.
    Table 6 shows some of the other items in the bill that, 
although important, could not be called ``sudden, urgent, 
unforeseen, and temporary.''

         TABLE 6.--INAPPROPRIATELY DESIGNATED EMERGENCY SPENDING
             [Omnibus Appropriations Bill Public Law 105-27]
------------------------------------------------------------------------
                          Item                                Amount
------------------------------------------------------------------------
Defense Health Program..................................    $200,000,000
Defense Ongoing Overseas Contingency Operations.........   1,858,600,000
Ballistic Missile Defense Program Enhancements..........   1,000,000,000
Purchase of Natural Uranium from Russia.................     325,000,000
Coast Guard Operating Expenses..........................     100,000,000
Coast Guard Construction and Capital Acquisition........     100,000,000
Non-Defense Y2K Conversion..............................   2,250,000,000
Defense Y2K Conversion..................................   1,100,000,000
Commercial Fishing Failure Assistance to Persons in the        5,000,000
 Northeast Multispecies Fishery.........................
Assistance for the New Independent States of the Soviet       46,000,000
 Union..................................................
Agriculture Research Service for Counter-Drug Research        23,000,000
 and Development........................................
Drug Enforcement Administration Salaries and Expenses...      10,200,000
Immigration and Naturalization Service Integrated             10,000,000
 Surveillance Information Systems.......................
Mohair Recourse Loans...................................      27,000,000
Wildland Fire Management................................     102,000,000
Low Income Home Energy Assistance.......................     300,000,000
------------------------------------------------------------------------
Please Note: The committee recognizes that many of the items in this
  table represent important spending provisions. Their inclusion here
  simply reflects that they do not meet both sets of criteria for an
  emergency as defined in this legislation--especially that they are not
  sudden, urgent, unforeseen, and temporary.

    The reserve-fund procedure set forth in this title requires 
policymakers to anticipate emergency needs much as they do for 
any program. As suggested by the above table, although it is 
impossible to predict specific emergencies, it is clearly 
reasonable to assume that emergencies will arise and to 
anticipate the amount of Federal resources that will be 
required to respond to such them.
    For example, the Federal Emergency Management Agency [FEMA] 
is a major part of the Federal Government's emergency response 
apparatus. Between 1992 and 1999, FEMA has required $25.4 
billion in budget authority, with a high of $5.4 billion in 
fiscal year 1994 and a low of $1.2 billion in fiscal year 1999 
[see Table 7]. On the basis of this information. it is possible 
to anticipate FEMA's funding needs. Indeed, FEMA's annual 
budget requests already are based on a 5-year rolling average 
of the amount it actually obligates in a given fiscal year.

             TABLE 7.--FEMA APPROPRIATIONS (DISASTER RELIEF)
                          [Dollars in millions]
------------------------------------------------------------------------
                                                              Regular
               Fiscal year                  Actual \1\    appropriations
                                                               bill
------------------------------------------------------------------------
1992....................................          $4,178            $184
1993....................................           2,027             292
1994....................................           5,409             292
1995....................................           2,592             320
1996....................................           3,393             320
1997....................................           4,620             320
1998....................................           1,920             320
1999....................................           1,214             308
                                         -------------------------------
      Total.............................          25,353           2,356
------------------------------------------------------------------------
\1\ Final appropriations including supplementals.

    Yet despite the predictability of FEMA's funding needs, 
FEMA is consistently underfunded in the regular appropriations 
bills; most of its funding needs are met in supplemental 
appropriations. As seen in the table below, between fiscal 
years 1992 and 1999, an average of $300 million has been 
provided in the regular appropriations bills and $2.9 billion 
in the supplemental bills.
    What happens to money that should have been appropriated 
for FEMA's average needs? Under fixed limits on discretionary 
spending, it goes to lower priority programs. Then the 
President, careful not to underfund FEMA, sends supplemental 
requests later in the year, which Congress then funds in a 
supplemental appropriations bill. The supplemental includes an 
emergency designation that raises the discretionary spending 
limits by the amount that could have been provided in the 
regular appropriations bill.
    The budgetary framework for emergencies in this bill will 
reduce some of the pressure to increase discretionary spending. 
By requiring budgeting in advance for emergencies--and by 
stipulating criteria for releasing these emergency funds--the 
reform will effectively plug the largest loophole in the 
discretionary spending limits. If this title had been in effect 
last year, Congress would not have exceeded the spending 
discretionary spending limits by $20 billion, because many of 
the supplemental provisions would have failed to meet the 
definition of ``emergencies,'' and because the amount would 
have exceeded the amount in the reserve fund. To accommodate 
the $20 billion, Congress and the President would have had to 
find offsets in other discretionary programs or publicly 
concede they were breaching the budget agreement by enacting a 
law that explicitly raised the discretionary spending limits.
    A reserve fund for emergencies also has the potential to 
expedite legislative action on the emergency appropriations. In 
recent years, the debate over what constitutes an emergency, 
and whether and how it should be offset, has been contentious 
and time-consuming. Offsetting the reserve through the budget 
resolution seems an obvious solution. If the emergency reserve 
fund were financed through the budget resolution, then it could 
be financed with both mandatory and discretionary savings that 
crossed the jurisdiction of multiple committees. Moreover, 
because the budget resolution would now be a joint resolution, 
the President would be brought into the overall financing 
scheme.
    Finally, this title preserves Congress's ``power of the 
purse'' even as it subjects emergency spending to budgetary 
controls. Although the President must include a set-aside for 
emergencies, the Congress controls the levers over the reserve 
fund. It is the Appropriations Committee that must appropriate 
the funds for emergencies on a bill-by-bill basis. It is the 
Budget Committee that withholds the emergency reserve from the 
allocations and then adjusts the allocations on a case-by-case 
basis. At no point is the President appropriated the funds in 
advance and given the discretion to use them for whatever 
purpose he deems appropriate.

             TITLE III--ENFORCEMENT OF BUDGETARY DECISIONS


             Subtitle A--Application of Points of Order to
                         Unreported Legislation

    Current Law. Both the House and Senate are prohibited from 
considering spending and tax legislation before the budget 
resolution is agreed to; and when the budget resolution is 
adopted, they are prohibited from considering legislation 
exceeding the resolution's budget aggregates and allocations. 
These restrictions appear under sections 302(f), 303(a), and 
311(a), respectively, of the Congressional Budget Act. Any 
Member of the House can enforce these prohibitions by raising a 
point of order when the measure is brought to the floor. If the 
Chair sustains the point of order, then the House is precluded 
from further consideration of the measure. Such points of order 
may be raised against reported bills and joint resolutions, 
amendments, conference reports, and certain motions.
    In a significant exception to these restrictions in the 
House, a bill brought to the floor without having been reported 
by the committee of jurisdiction is not subject to points of 
order because the restrictions do not literally apply to 
nonreported bills. The language of section 302(f) of the 
Congressional Budget Act reads as follows:

          (1) LEGISLATION SUBJECT TO POINT OF ORDER IN THE 
        HOUSE OF REPRESENTATIVES.--After the Congress has 
        competed action on a concurrent resolution on the 
        budget for a fiscal year, it shall not be in order in 
        the House of Representatives to consider any bill, 
        joint resolution, or amendment providing new budget 
        authority for any fiscal year, or a conference report 
        on any such bill or joint resolution if----
                  (A) the enactment of such bill or resolution 
                as reported;
                  (B) the adoption and enactment of such 
                amendment; or
                  (C) the enactment of such bill or resolution 
                in the form recommending such conference 
                report,

        would cause the applicable allocation of new budget 
        authority made under section (a) or (b) for the first 
        fiscal year or the total of fiscal years to be 
        exceeded. (Italics added.)

    In the Senate, however, the point of order can be raised 
against nonre ported bills. The comparable restriction for 
exceeding the allocations in the Senate reads as follows:

          (2) IN THE SENATE.--After a concurrent resolution on 
        the budget is agreed to, it shall not be in order in 
        the Senate to consider any bill, joint resolution, 
        amendment, motion, or conference report that would 
        cause--
                  (A) in the case of any committee except the 
                Committee on Appropriations, the applicable 
                allocation of new budget authority or outlays 
                under subsection (a) for the first fiscal year 
                or the total of fiscal years to be exceeded; or
                  (B) in the case of the Committee on 
                Appropriations, the applicable suballocation of 
                new budget authority or outlays under 
                subsection (b) to be exceeded.

    Although bills and resolutions must be reported before they 
are considered on the floor under House Rule XIII, they can be 
brought directly to the floor under a House resolution 
providing for the consideration of the measure. One reason for 
bringing unreported bills to the floor has been to avoid a 
point of order or, more frequently, to avoid the necessity of 
waiving the point of order.

    Summary of Proposal. Subtitle A extends all Budget Act 
requirements under sections 302(f), 303(a), and 311(a) to bills 
that are considered on the floor without having been ordered 
reported from the committee of jurisdiction. Both the House and 
Senate would be prohibited from considering an unreported bill 
that is considered before the resolution is agreed to, that 
exceeds the appropriate committee's allocation, that reduces 
revenue below the revenue aggregates, or that exceeds the 
aggregates for budget authority and outlays. Any unreported 
bill would be subject to a point of order that, if raised and 
sustained by the presiding officer, would preclude further 
consideration of the measure.

    Purpose of Proposed Change. The reason for extending Budget 
Act requirements to unreported bills is to strengthen 
enforcement of the budget resolution. Loopholes in the process 
that permit the enactment of legislation exceeding the level of 
the budget resolution call into question the very utility of 
having a budget (whether joint or concurrent). In the case of 
the loophole for unreported bills, the majority leadership of 
both parties has occasionally bypassed the committees of 
jurisdiction to avoid the embarrassment of waiving the Budget 
Act.
    In 1991 a series of bills dealing with veterans' benefits 
were brought to the floor without being reported by committee 
(H.R. 3, H.R. 111, and H.R. 180). Although these bills exceeded 
the Veterans Affairs Committee's allocation of new budget 
authority, they did not technically violate section 302(f) of 
the Budget Act--because they were not reported by the committee 
of jurisdiction--and hence were not subject to the point of 
order. In another example, the House considered a bill offered 
by Senator Dole during the Presidential campaign of 1996. Even 
though the revenue loss from the bill would have reduced 
revenue below the revenue floor, a point of order under section 
311(a) of the Budget Act could not be raised against the bill 
because it was not reported from the Committee on Ways and 
Means.
    Applying points of order to nonreported bills also provides 
for more equitable enforcement of the Budget Act for members of 
the minority. Because in the House the majority effectively 
determines what bills can be brought to the floor--and often 
the minority's only means of shaping legislation is through 
amendments--the minority is at a decided disadvantage when the 
majority brings a nonreported bill to the floor. The bill may 
clearly breach the aggregates and appropriate allocations, but 
the minority cannot block it through a point of order. 
Moreover, any amendment that might be offered with comparable 
violations of the Budget Act is subject to a point of order.
    On July 24, 1998, the House considered H.R. 4250, the 
Patient Protection Act of 1998. This legislation, which 
provided for a change in revenue, was not reported out of the 
Ways and Means Committee. Had it been a reported bill, it would 
have been subject to a point of order under section 303 (a) of 
the Congressional Budget Act, which specifically prohibits such 
changes prior to the passage of a concurrent resolution on the 
budget. But a point of order under this same section of the 
Budget Act was sustained against a motion to recommit the bill 
because it too would have provided for a change in revenues. 
Thus a point of order did not arise against the bill under 
consideration because it had not been reported by committee, 
but did lie against the motion to recommit, though both were 
equally guilty of violating the Budget Act.
    Although this rule was developed by the previous majority, 
the Budget Committee believes it is unfair for the majority to 
exceed its own budget resolution, and then prevent the minority 
from offering amendments. At a time when the Congress is 
closely divided, policy decisions should be made on their 
merits, and not on the basis of rules that only restrict the 
minority. In ensuring the rules are fair for all parties, the 
Budget Committee hopes to encourage the bipartisan efforts that 
led to the development of this bill.
    Applying the Budget Act to nonreported bills will also 
bring House procedures in line with those of the Senate, which 
already enforces points of order against nonreported bills. The 
congressional budget process was designed to provide a common 
set of procedures by which the House and Senate could agree to 
a budget. It makes little sense to have the same rule but to 
enforce it differently in each House. In this case, it makes 
the House more dependent on the Senate to enforce the budget 
resolution.
    There are two other reasons for applying points of order to 
nonreported bills. First, the current loophole encourages the 
leadership to bypass the committee system in the development of 
important legislation. This was clearly a factor in the case of 
H.R. 4250. Second, the disparity in the treatment of 
nonreported bills in the House and the Senate contributes to 
the inefficiency of the current process. It makes little sense 
to agree to a common set of levels between the House and the 
Senate, with or without the President's formal input in the 
process, if the House can unilaterally circumvent any budgetary 
level it has agreed to.

             Subtitle B--Compliance with Budget Resolution

    Current Law. A point of order can be raised in the House 
against any reported bill or resolution that is considered 
before the budget resolution is agreed to, or that exceeds the 
allocations and aggregates in the budget resolution. In the 
House, however, these requirements can be preemptively waived 
by a simple majority in the resolution (rule) providing for the 
consideration of the measure. By contrast, it takes three-
fifths of the Senate to waive a point of order for a bill that 
exceeds the allocations or aggregates, though such a vote on a 
waiver may occur only if the point of order is actually raised.
    If a reported bill or joint resolution violates the Budget 
Act, the Budget Committee chairman frequently urges the 
chairman of the reporting committee to seek a rule that self-
executes an amendment eliminating the violation. Occasionally 
the chairman of the reporting committee will refuse, and will 
instead request a rule that waives the point of order. In such 
cases, the chairman of the reporting committee is not required 
to formally justify why his or her committee was unable to 
comply with the budget resolution. Under clause 3(c) of House 
Rule XXIII, the committee reports need only include a cost 
estimate prepared by CBO and, if the estimate is not available, 
a comparison of the amount of budget authority provided by the 
measure and the committee's allocation.

    Summary of Proposal. Subtitle B stipulates that the report 
on any bill or joint resolution must include a statement from 
the Budget Committee indicating whether the bill violates the 
Budget Act. The compliance statement is to be prepared by the 
chairman of the Budget Committee. In addition to stating 
whether the bill is within the allocations and aggregates 
established by the budget resolution, the statement may discuss 
whether the bill complies with any statutory controls over the 
budget, such as discretionary spending limits and PAYGO 
requirements for taxes and entitlements.

    Purpose of Proposed Change. The purpose of requiring the 
reporting committee to include this statement is to put 
pressure on its members to keep legislation within the levels 
established by the budget resolution. By requiring the 
statement to be included in the report, the violation will be 
widely disseminated throughout the Congress, the 
administration, and the public at large.

            Subtitle C--Justification for Budget Act Waivers

    Current Law. Neither the Congressional Budget Act nor the 
Rules of the House of Representatives require committees to 
keep track of all bills within their jurisdictions that violate 
any section of the Budget Act. House committees generally 
concern themselves with Budget Act violations only when floor 
consideration is at hand--specifically, when the Rules 
Committee is determining whether to report a resolution that, 
for a given measure, amends the measure to eliminate the 
violation, or waives the applicable sections of the Budget Act.

    Summary of Proposal. Section 423 requires the 
Appropriations Committee and each of the authorizing committees 
to include in its oversight report--required under clause (d) 
of House Rule XI--a list of all measures reported during a 
given session that exceeded the committee's allocations, 
exceeded the budget aggregates, or were considered before the 
budget resolution was agreed to. The provision also requires 
each committee to include the total amount by which its 
reported bills exceeded its allocations.

    Purpose of Proposed Change. The basic purpose of this 
report requirement is to hold committees publicly accountable 
for measures that violate the Congressional Budget Act.

             Subtitle D--CBO Scoring of Conference Reports

    Current Law. Current law contains no requirement that the 
Congressional Budget Office provide estimates to accompany 
conference reports.

    Summary of Proposal. This subtitle would require the 
Congressional Budget Office to prepare scoring of conference 
reports, other than tax bills, whenever practicable. (Tax bills 
are scored by the Joint Committee on Taxation.) The Budget 
Committee recognizes that, in some cases, the time that elapses 
between the completion of a conference and the floor vote on 
the conference report may be insufficient for CBO to complete 
its estimates. That is why the bill calls for the preparation 
of these estimates whenever practicable.

    Purpose of Proposed Change. It is hoped that, in addition 
to providing Members more complete information on the final 
form of legislation, this proposal will discourage Members from 
inserting last-minute spending items in conference reports.

             TITLE IV--ACCOUNTABILITY FOR FEDERAL SPENDING

    Title IV retains the Budget Act's historical focus on 
curbing so-called backdoor spending, but establishes new 
procedures to achieve that end. It replaces the automatic 
referral of new entitlements to the authorizing committees, and 
the points of order against creating new forms of entitlements, 
with procedures that: first, limit the duration of any new 
spending program; second, subject proposed entitlements to 
annual appropriations; and third, eliminate disincentives for 
funding new programs through annual discretionary 
appropriations.

               Subtitle A--Limitations on Direct Spending


            SECTION 411: FIXED-YEAR AUTHORIZATIONS REQUIRED
                            FOR NEW PROGRAMS

    Current Law. The Congressional Budget Act of 1974 
established procedures to stem the proliferation of programs 
not subject to annual appropriations. Section 401(a) of the 
Budget Act prohibits the consideration of legislation in the 
House or Senate that provides borrowing authority, contract 
authority, or credit authority unless the authority is subject 
to annual appropriations. Significantly, the point of order can 
be raised under section 401(a) even if the legislation is 
within the Appropriations Committee's allocation.
    Section 401(b) prohibits the consideration of legislation 
that provides entitlement authority in the current fiscal year. 
Section 401(b)(1) even applies when the appropriate committee 
has a sufficient allocation to cover the new entitlement 
authority. Section 4(b)(2) provides that any bill that 
establishes new entitlement authority is automatically referred 
to the Committee on Appropriations.
    In the current fiscal environment, authorizing committees 
actually have strong incentives to create mandatory programs 
that are not subject to annual appropriations.
    First, the authorizing committees have complete control 
over programs that are not subject to annual appropriations. 
Not only do the authorizing committees determine the 
programmatic construction of the new programs, but they can 
also determine the funding levels.
    Second, mandatory programs don't have to compete with 
existing discretionary programs for limited funding under the 
allocations. Moreover, the imposition of statutory caps 
enforced by sequestration in 1990 put even more pressure on the 
Appropriations Committee to avoid incurring new 
responsibilities.
    Third, because permanent programs by definition do not have 
to be reauthorized, they do not require periodic offsets. Each 
time a program expires, if it incurs direct spending of less 
than $50 million in a year, the committees are often required 
to offset the extension if the program is maintained at current 
law levels.

    Summary of Proposal. Subsection (a) prohibits the 
consideration of any bill on the House or Senate floor that 
provides direct spending for a new program unless the spending 
authority is limited to a period of 10 or fewer years. Direct 
spending is defined as ``(A) budget authority provided by law 
other than appropriations acts; (B) entitlement authority; and 
(C) the Food Stamp Program.
    The restriction encompasses all forms of mandatory 
spending, including entitlement authority, contract authority, 
borrowing authority, and reductions in offsetting receipts and 
collections (as a form of positive budget authority).
    Subsection (c) prohibits the consideration of legislation 
in the House that authorizes the appropriation of discretionary 
new budget authority unless it is also limited to 10 or fewer 
years.
    Both sets of restrictions under subsection (a) and (b) 
apply to bills and joint resolutions--whether or not they are 
reported from committee--motions, and conference reports. The 
effect of the points of order, if raised at the appropriate 
time and sustained by the Chair, would be to preclude further 
consideration of the measure.

    Purpose of Proposed Change. Implicit in this subtitle is 
the assumption that all programs that are taxpayer-financed 
should be subject to periodic review through the authorization 
process. The reauthorization process is seen as an effective 
vehicle for systematically reviewing agency goals, assessing 
performance, eliminating overlapping or duplicative functions, 
and making such changes in program design as are necessary.
    The Budget Committee recommends that committees coordinate 
reauthorization activities with the performance budgeting 
requirements of the Government Performance and Results Act of 
1993. Committees also are urged, whenever possible, to 
establish explicit purposes for each program, project, or 
activity reauthorized pursuant to this schedule.

         SECTION 412: AMENDMENTS TO SUBJECT NEW DIRECT SPENDING
                        TO ANNUAL APPROPRIATIONS

    Current Law. Under section 401(b)(2) of the Congressional 
Budget Act, certain entitlement bills are referred to the 
Committee on Appropriations. To be so referred, the bill must 
be reported by an authorizing committee; must create a new 
entitlement authority; and must be in an amount in excess of 
the committee's allocation. The Appropriations Committee is 
permitted 15 days to report the bill. Presumably the 
Appropriations Committee would amend the bill to reduce the 
amount of direct spending to the levels assumed in the 
allocation. If the Appropriations Committee does not report the 
bill, the bill is discharged and placed on the appropriations 
calendar.

    Summary of Proposal. The bill repeals section 401(b)(2) of 
the Budget Act because the referral to the Appropriations 
Committee has never resulted in a proposed entitlement being 
reduced to levels consistent with the reporting committee's 
allocation or converted to a discretionary program subject to 
annual appropriations.
    In place of section 401 of the Budget Act, section 412 of 
the bill makes it always in order for the chairmen of the 
Budget Committee to offer to any measure creating a new 
entitlement, a floor amendment subjecting the program to the 
annual control of the appropriations process. In other words, 
the bill would convert the proposed new entitlement or direct 
spending program to the control of the annual appropriations 
process. The right to offer the amendment is limited to the 
Budget Committee chairmen. The bill provides for an automatic 
adjustment in the aggregates and allocations, and any 
discretionary spending limits, if the bill authorizes a new 
discretionary program and offsets it with mandatory savings. 
The adjustment is modeled on the reserve funds set forth in 
section 314 of the Budget Act and section 251 of the Emergency 
Balanced Budget and Deficit Control Act. These sections provide 
for automatic increases in the aggregates, allocations, and 
discretionary spending limits for legislation that provides 
appropriations for certain specified purposes (including Earned 
Income Credit fraud and abuse compliance, international 
arrearages, and continuing disability reviews).

    Purpose of Proposed Change. Subtitle A repeals the referral 
to the Appropriations Committee of bills providing new 
entitlement authority. This process has not curbed the 
proliferation of new entitlements. In the only episode of the 
Appropriations Committee acting on such a referral, in 1981, 
the version of the bill reported by the Appropriations 
Committee was defeated on a 170 to 232 vote. (The vote 
concerned a military pay increase referred to the 
Appropriations Committee by the House Armed Services 
Committee.) It has been suggested that one reason the 
Appropriations Committee has not been vigilant in blocking the 
creation of new entitle ments is that the alternative--the 
creation of new discretionary programs--only puts pressure on 
existing discretionary priorities because of the fixed limits 
on discretionary appropriations.
    In place of the unsuccessful referral process, this 
legislation permits floor amendments that subject proposed new 
entitlements to discretionary appropriations. This will provide 
a new mechanism for curbing the proliferation of mandatory 
programs. As a deterrent to any effort to preclude such 
amendments, the House would have to pass a resolution that 
specifically waived the House rule providing the authority to 
offer the amendments. Pursuant to this rule, the bill limits 
the ability of the Rules Committee to prevent such amendments 
only if it is offered by the chairmen of the Budget or 
Appropriations Committees. The reason for this limitation is 
twofold. First, the chairmen of these two committees have 
institutional interests in curbing the proliferation of 
mandatory programs. Second, the limitation will prevent 
nuisance amendments by Members who are seeking only to delay 
legislative deliberations.

     Subtitle B--Enhanced Congressional Oversight Responsibilities


  SECTION 421: TEN-YEAR CONGRESSIONAL REVIEW REQUIREMENT OF PERMANENT 
                            BUDGET AUTHORITY

    Current Law. Under clause (2)(d)(1) of House Rule X, each 
House committee is required to submit an oversight plan to the 
Committees on Government Reform and Oversight and House 
Oversight. These plans are to be submitted by February 15 of 
the first session of each Congress. Clause 2(d)(1)(C) directs 
each committee, in developing the plans, to ``have a view 
toward ensuring that all significant laws, programs, or 
agencies within its jurisdiction are subject to review at least 
once every 10 years.''

    Summary of Proposal. Section 421 requires each authorizing 
committee to submit, as part of its oversight plan, a schedule 
for reviewing all programs in its jurisdiction within a period 
of 10 years. This requirement includes both mandatory and 
discretionary programs; those with permanent appropriations; 
and those that are annual or multiyear.

    Purpose of Proposed Change. As in section 411 of the bill, 
the purpose of requiring committees to establish plans for 
reauthorizing all programs is to encourage systematic review of 
agency goals, assessments of performance, elimination of 
overlapping or duplicative functions, and, as necessary, the 
redesign of program structures.
    Although this section does not enumerate specific oversight 
responsibilities, the Budget Committee recommends that 
committees coordinate their reauthorization activity with the 
performance budgeting requirements set forth under the 
Government Performance and Results Act. Most important, 
committees are urged, whenever possible, to establish explicit 
purposes for each program, project, or activity reauthorized 
pursuant to this schedule.
    Committees are further advised to stagger the schedule for 
reauthorizing all programs, projects, and activities within 
their jurisdictions so that their workload is evenly 
distributed over the 10-year period of the review cycle.

             SECTION 422: JUSTIFICATIONS OF DIRECT SPENDING

    Current Law. Under section 401(a) of the Budget Act, the 
House and Senate are prohibited from considering legislation 
that provides any one of the following forms of budget 
authority that are not subject to the control of the 
appropriations process:

- Authority to enter into contracts under which the United 
    States is obligated to make outlays.

- Authority to incur indebtedness for which the United States 
    is liable for repayment.

- New credit authority.

    Section 401(a) is enforced by a point of order that, if 
sustained, precludes the House or Senate from further 
consideration of the measure. The point of order may be raised 
against reported bills, joint resolutions, amendments, and 
conference reports. The point of order may be waived by a 
simple majority in both the House and Senate.
    Under section 401(b) of the Budget Act, the House and 
Senate are prohibited from considering any bill that provides 
new entitlement authority that is effective during the current 
fiscal year. Section 401(b) is also enforced by a point of 
order that can be waived by simple majority of either House. 
The point of order may be raised against reported bills or 
joint resolutions, amendments, and conference reports.

    Summary of Proposal. Section 422 requires the report 
accompanying the budget resolution to justify any allocation 
for a new program, project, or activity made to a committee 
other than Appropriations. For example, the conference report 
on the budget resolution for fiscal year 2000 (H. Con. Res. 68) 
provided an allocation of $3 billion in new budget authority 
and outlays for the Committee on Ways and Means. The report 
specified that the allocation is for assumed child care 
legislation. Under section 103 of the bill, the report would 
have to include a justification explaining why the allocation 
was not provided to the Committee on Appropriations.
    This subtitle repeals sections 401(a) and 401(b)(1) of the 
Budget Act.

    Purpose of Proposed Change. Section 422 puts the onus on 
the Budget Committees for permitting the creation of new 
mandatory programs. It is the Budget Committees that are 
responsible for providing the allocations necessary for new 
entitlement programs. This section forces the Budget Committee 
to justify why it provides allocations for mandatory programs 
that could reasonably be provided to the Appropriations 
Committee--where they would be subject to annual review.
    Sanctions under sections 401(a) and 401(b) of the Budget 
Act occur too late in the budget cycle to effectively deter the 
creation of new and expanded direct spending programs. There 
are several reasons for this.
    First, these points of order often penalize the reporting 
committee for reporting the new mandatory program, but fail to 
penalize the Budget Committee for providing the allocation. For 
example, assume the budget resolution provides, in its 
allocation to the Education and Workforce Committee, $50 
million for a new entitlement program. Even if the authorizing 
committee moves a bill that costs less than $50 million, the 
legislation is subject to the point of order for creating a new 
entitlement.
    Second, the existing provisions offer no additional 
enforcement if the authorizing committee reports a bill that 
exceeds its allocation. In this case, the bill would be subject 
to a point of order under section 302(f) of the Budget Act--and 
could be killed if that point of order prevailed. Section 
401(a) or (b) add little to the enforcement regime. Besides, if 
the Rules Committee chooses to waive section 302(f) for a given 
bill, it can just as easily waive section 401.

      SECTION 423: SURVEY OF ACTIVITY REPORTS OF HOUSE COMMITTEES

    Current Law. Under current law, legislation that does not 
comply with the Budget Act is subject to points of order. In 
the House, a committee is typically concerned with any 
violations after it has reported a measure--when the committee 
is requesting a rule providing for consideration of the bill. 
At that point, if the bill does contain one or more violations 
of the Budget Act, the Budget Committee chairman encourages the 
authorizing committee to request a rule that self-executes an 
amendment ``curing'' the bill. The authorizing committee 
chairman may resist these entreaties, and instead seek a rule 
that waives the applicable sections of the Budget Act so the 
bill will not be subject to any such points of order on the 
floor.
    After House action, committees tend to lose track of 
measures under their jurisdictions that violate the Budget Act. 
The Rules Committee, however, keeps track of rules that waive 
any section of the Budget Act, and publishes a summary of such 
waivers in its activity report.
    Committees are currently required to submit an activity 
report under clause 1(d)(1) of House Rule XI. These reports do 
not currently include any discussion relating to budget 
enforcement.

    Summary of Proposal. Section 423 requires each committee to 
include in its activity reports, filed at the end of each 
Congress, a summary of all measures it reported that violated 
the Budget Act. The report also must include the total amount 
by which the bills within the committee's jurisdiction exceeded 
its allocations and--in the case of the Committee on Ways and 
Means--reduced revenue below the revenue aggregates.

    Purpose of Proposed Change. This section is intended to 
make the committees more responsible for bills that violate the 
Budget Act, and to provide this information to Members of 
Congress, public interest groups, and the public at large.

   SECTION 424: CONTINUING STUDY OF ADDITIONAL BUDGET PROCESS REFORMS

    Current Law. Under section 703 of the Budget Act, the 
Committee on the Budget is required to study and report to the 
House proposals to, among other things, ``establish maximum and 
minimum time limitations for program authorization.'' The 
Budget Committees are required to report their findings, 
together with any recommendations, to their respective Houses.
    There is no record of any findings under section 703 of the 
Budget Act ever having been reported to the House.

    Summary of Proposal. The amendment requires the Budget 
Committees to report to their respective Houses, at least once 
every 5 years, on the areas set forth in section 703 of the 
Budget Act.

    Purpose of Proposed Change. The purpose of this section is 
to require the Budget Committee to report on the above items by 
a date certain. The committee should evaluate any progress 
encouraging periodic reauthoriza tion pursuant to subtitles A 
and B. This evaluation should, among other things, assess the 
feasibility of formally integrating elements of performance 
budgeting under the Government Performance and Results Act and 
the reauthorization cycle.

                        SECTION 425: GAO REPORTS

    Current Law. Section 404 of the Congressional Budget Act 
requires the General Accounting Office to report on provisions 
of law providing mandatory spending, and evaluate whether such 
financing is appropriate for the programs. The report is to be 
revised ``from time to time.''
    GAO provided the first report in 1987 and has revised it on 
two other occasions.

    Summary of Proposal. Section 425 of the bill requires the 
reports under section 404 of the Budget Act to be revised at 
least once every 5 years.

    Purpose of Proposed Change. The reason for requiring more 
frequent reports is to keep the Congress abreast of the rate at 
which mandatory programs are created.

                Subtitle C--Strengthened Accountability


                  SECTION 431: TEN-YEAR CBO ESTIMATES

    Current Law. Under current law, the Federal budget process 
focuses on short-term estimates and projections. The detailed 
budget estimates that make up the core of the President's 
budget submission cover the forthcoming budget year, for which 
the appropriations must be made. The congressional budget 
resolution sets revenue and spending levels for the budget year 
and 4 ensuing years (section 207 of S. Con. Res. 68).
    Both the House and the Senate are prohibited from 
considering legislation that breaches the allocations and 
aggregates for the first year and the 5-year total. In 
addition, the Senate is prohibited from considering legislation 
that is not offset in the first year, the total for the first 5 
years, and the total for the second 5 years.
    The Congressional Budget Office [CBO] also largely relies 
on short-term estimates. In the cost estimates CBO is required 
to provide on every reported and enacted bill, CBO estimates 
generally cover a period of 5 years. Since 1995, CBO has 
provided 10-year estimates for the Senate's pay-as-you-go 
[PAYGO] point of order.
    In recent years there has been an effort to expand the 
horizon of key budgetary projections. In 1995, the Congress 
agreed to a budget resolution that covered 7 fiscal years. The 
Balanced Budget Act of 1997 [BBA] formally expanded the number 
of years that may be included in the budget resolution--to any 
number of years included in the resolution. The BBA also 
amended the Budget Act to prohibit the consideration of 
legislation that exceeded the total of the years in the 
resolution. This year, the Congress agreed to a budget 
resolution that covered a period of 10 fiscal years.

    Summary of Proposal. Subtitle C permanently requires CBO 
estimates to cover a period of 10 fiscal years. Under current 
law, CBO will no longer have authority to provide 10-year 
estimates once PAYGO, and the Senate PAYGO point of order, 
expire at the end of fiscal year 2002.

    Purpose of Proposed Change. The reason for permanently 
extending the 10-year estimates is to deter Federal agencies 
and the authorizing committees from developing legislation that 
has significant costs just outside the horizon of the budget 
resolution. The Budget Committee believes these estimates 
should be provided on a permanent basis, rather than lapsing 
with the expiration of what are essentially temporary controls 
on the Federal budget.
    The committee also believes that Congresses should monitor 
these estimates and compare them to actual levels, with an eye 
toward enforcing these levels in the future.

           SECTION 432: REPEAL OF RULE XXIII OF THE RULES OF
                      THE HOUSE OF REPRESENTATIVES

    Current Law. Under House Rule XXIII (formerly Rule XLIX), 
when the House votes on the conference report accompanying the 
concurrent budget resolution, a bill raising the limit on the 
statuary debt is automatically engrossed and signed by the 
Clerk as if it has passed the House and Senate. In other words, 
Rule XXIII enables the House to send a bill to the Senate 
raising the debt limit without actually voting on it.

    Summary of Proposal. Section 432 repeals House Rule XXIII.

    Purpose of Proposed Change. This section repeals House Rule 
XXIII to increase the accountability of the Congress when 
agreeing to legislation that increases the national debt. It is 
appropriate to require such a vote when the debt limit is 
largely a consequence of congressional action (whether in the 
present or in the past).
    Title I of this process reform bill does, however, permit 
the proposed joint budget resolution to include legislative 
language increasing the limit on the statutory debt. In the 
context of the stripped-down budget resolution set forth in 
section 103, any provision in the budget resolution increasing 
the limit on the statutory debt would be visible. Moreover, any 
increase in the debt limit would be guaranteed a vote. This is 
because a roll call vote on the budget resolution is 
automatically ordered under clause 10 of House Rule XX.

    TITLE V--BUDGETING FOR UNFUNDED LIABILITIES AND OTHER LONG-TERM 
                              OBLIGATIONS


               Subtitle A--Budgetary Treatment of Federal
                           Insurance Programs

    Current Law. Most Federal programs use cash-based 
budgeting. In this system, a program's cost is the net cash 
spent in a fiscal year. Income is recorded in the budget when 
received, and expenses are recorded when paid, without regard 
to when the income is earned or the expense incurred. Federal 
insurance programs, such as pension insurance and political 
risk insurance, currently use cash-based budgeting. Cash 
budgeting provides incomplete and misleading cost information 
for those programs because, for most insurance contracts, 
premiums are paid long before claims are made. Under current 
budget conventions, legislation affecting Federal insurance 
programs often is seen as providing savings even though it 
expands insurance coverage and increases the likelihood that 
the cost of claims over time will be higher than expected in 
the absence of the legislation. Such situations can occur when 
the legislation increases premiums today; but claims due under 
the higher coverage would not be paid until future fiscal 
years--often well beyond the budget window.
    The only exceptions to cash-based budgeting under current 
law are Federal loan and loan guarantee programs and the 
retirement systems for the military and for Federal employees. 
Those programs use ``accrual'' budgeting to more accurately 
reflect their cost to taxpayers. Executive agencies must 
maintain accounts on an accrual basis pursuant to legislation 
enacted in 1956, but those figures are not used for planning 
and budgeting. (They are used in the preparation of the 
government's consolidated financial statements.) In 1992, the 
Bush administration proposed to change the budget treatment of 
insurance programs from a cash basis to an accrual basis. That 
proposal was not enacted.

    Summary of Proposal. This bill would apply accrual concepts 
to budgeting for the costs of Federal insurance programs, 
adapting the budgetary principles now used for Federal loan and 
loan guarantee programs to Federal insurance programs. It would 
build on the Credit Reform Act of 1990, which required that the 
budget be charged the subsidy inherent in Federal loan and loan 
guarantee programs. The success of applying accrual concepts to 
Federal credit programs recommends that Congress consider 
broadening their use to other programs where cash-based 
budgeting does not reflect cost accurately--such as Federal 
insurance programs.
    Beginning in fiscal year 2006, the budget would include the 
expected long-term cost of an insurance contract in the year in 
which the contract was written. The long-term cost would be 
expressed as the net present value of the cash flows expected 
over the entire life of an insurance contract. This calculation 
provides a measure of the cost of the risk assumed by 
taxpayers--the subsidy--that results from the government's 
providing an insurance commitment. Cost calculations would be 
made on a portfolio basis for the contracts written in a fiscal 
year, but agencies would have the flexibility to divide the 
portfolio as necessary to more accurately determine the risk-
assumed cost of their insurance commitments. The budget would 
reflect subsidy cost rather than cash flows, making the budget 
a more accurate measure of Federal spending.
    Accrual budgeting would be required for all Federal 
insurance programs, defined as any program under which an 
agency makes an agreement in advance to pay a non-Federal 
entity if it experiences specified losses. To clarify what kind 
of program is considered to be an insurance program, the bill 
provides that the conference report statement of managers will 
include a list of the programs that at a minimum would be 
subject to the new accounting treatment. The committee assumes 
that this list will include the following programs identified 
by the General Accounting Office [GAO] as Federal insurance 
programs:

- Bank deposit insurance.

- Savings association deposit insurance.

- National credit union share insurance.

- The Pension Benefit Guaranty Corporation's pension insurance.

- National flood insurance.

- Federal crop insurance.

- Aviation war-risk insurance.

- Maritime war-risk insurance.

- Service-disabled veterans insurance.

- Veterans' mortgage life insurance.

- Federal employees' life insurance.

- Political risk insurance of the Overseas Private Investment 
    Corporation [OPIC].

- Vaccine injury compensation.

    The bill specifically excludes benefit programs such as 
Social Security and Medicare from risk-assumed budgeting. Those 
programs do not provide ``insurance'' as defined by this 
legislation: there is no underwriting of risk, but rather an 
entitlement to specified benefits when an individual meets 
program requirements. In the future, CBO and OMB are required 
to consult with the Budget Committees to determine whether 
proposed programs are Federal insurance programs under the 
statute's definition.
    In recognition of the many technical problems associated 
with measuring costs on an accrual basis, the shift to risk-
assumed budgeting is phased in over a 6-year period. Such a 
long lead time should be more than sufficient for CBO, OMB, and 
agencies with responsibility for Federal insurance programs to 
develop and refine methods to estimate the risk assumed by 
taxpayers for Federal insurance programs. In addition, the 
legislation provides for thorough review of those models and 
advisory estimates using them before they are used to determine 
cost in the budget, as detailed in Table 8.

   TABLE 8.--TIMETABLE FOR APPLICATION OF ACCRUAL BUDGETING TO FEDERAL
                           INSURANCE PROGRAMS
------------------------------------------------------------------------
        Fiscal year(s)                     Required activity
------------------------------------------------------------------------
2000-2001....................    Executive branch agencies and the
                               Congressional Budget Office (CBO) develop
                               models to estimate risk- assumed cost of
                               federal insurance programs.
------------------------------------------------------------------------
2002.........................    (1) Agencies submit models to the
                               Office of Management and Budget (OMB) for
                               review.
                                 (2) OMB and CBO make those models and
                               supporting information available for
                               public inspection and comment.
                                 (3) OMB and CBO, in consultation with
                               the Budget Committees, revise those
                               models based (in part) on comments
                               received by the public.
------------------------------------------------------------------------
2003.........................    OMB makes the revised models and
                               supporting information available for
                               public inspection and comment.
------------------------------------------------------------------------
2003-2005....................    (1) Administration budget submissions
                               and CBO reports on the economic and
                               budget outlook and the President's budget
                               include--for information purposes only--
                               account-level and aggregate presentations
                               that use accrual budgeting for federal
                               insurance programs.
                                 (2) CBO cost estimates for reported
                               legislation include--again, for
                               information purposes only--the cost of
                               the legislation on a risk-assumed cost
                               basis.
------------------------------------------------------------------------
2005.........................    OMB, CBO, and GAO each issue a report
                               that evaluates the advisability and
                               appropriate implementation of accrual
                               budgeting for federal insurance programs.
------------------------------------------------------------------------
2006-2007....................    The federal budget counts the cost of
                               federal insurance programs on a risk-
                               assumed (or accrual) basis.
------------------------------------------------------------------------
2007.........................    Accrual budgeting for federal insurance
                               programs either is continued or is
                               allowed to sunset. If allowed to sunset,
                               budget accounting reverts to the cash
                               basis used prior to October 1, 2005.
------------------------------------------------------------------------

    It should be noted that, although OMB receives the models 
and is expected to be actively involved in their revision, the 
committee does not expect OMB's involvement to change the 
customary or statutory relationship between it and other 
executive branch agencies.
    Although budget documents would reflect the expected costs 
of the insurance programs instead of their cash-flows, the 
government must continue to account for the cash transactions, 
such as receipt of premiums and payment of claims. As in credit 
reform, those transactions would be handled by nonbudget 
financing accounts. The net cash transactions of all financing 
accounts would flow into the calculation of the debt as a means 
of financing, providing a bridge between cash budgeting and 
accrual budgeting.

    Purpose of Proposed Change. The proposal would require that 
the budget reflect the true cost of Federal insurance 
activities, which would significantly strengthen accountability 
in Federal budgeting. Showing the long-term cost of an 
insurance program also could provide incentives to set 
appropriate premiums, and to limit losses. In addition, 
estimates of the cost of legislative proposals would capture 
the costs that occur outside the 5-year window used for budget 
enforcement. That could make it more difficult for the 
President and Congress to enact legislation increasing the 
costs of Federal insurance programs without offsetting 
potential long-term costs. Finally, the expected cost of 
existing insurance commitments would be reflected in 
calculations of the total budget surplus or deficit, and annual 
estimates of the cost of insurance programs will provide detail 
on the change in the cost of those existing commitments.
    The extent to which cash-based budgeting can underestimate 
the true cost of a Federal insurance program is illustrated by 
pension insurance. The Federal Government insures defined-
benefit pension plans through the Pension Benefit Guaranty 
Corporation [PBGC]. At the end of fiscal year 1998, PBGC 
estimated that its unfunded liability for bankrupt pension 
plans could be $15 billion to $17 billion. But the 
administration's current budget submission indicates that in 
fiscal year 1998 the PBGC took in about $2.2 billion and paid 
out only $1.0 billion. In other words, the administration 
budget suggests a $1.2-billion ``profit'' for the PBGC, even 
though the corporation has an unfunded liability at least 10 
times that amount. The budget makes it appear that businesses 
are being overcharged for the insurance coverage, when in fact 
the current premium rates are probably heavily subsidized by 
taxpayers.
    Enactment of this legislation would expose the cost of the 
subsidy, and could thereby provide incentives for policymakers 
and program managers to better align premiums and claims over 
the long term.
    Focusing on the short term already has cost taxpayers 
substantial amounts in the savings and loan crisis of the late 
1980's and early 1990's. According to Marvin M. Phaup of the 
Congressional Budget Office, the short-term focus of cash-based 
budgeting during that crisis encouraged policies that increased 
taxpayer costs by more than $50 billion. The added costs were 
incurred because Federal regulators weighed the cost of 
promptly closing failed thrifts against the effect on the 
deficit that would result from paying deposit insurance claims. 
Had risk-assumed budgeting been used at the time, the long-term 
cost of the insolvencies would have been anticipated better, 
and would not have produced the large swings in the 
government's bottom line that caused inaction. Failed 
institutions could have been closed rather than permitted to 
continue operating. The latter course compounded losses that 
had to be covered by taxpayers.
    Accrual budgeting also would improve estimates of the long-
term cost of new legislation. Bank deposit insurance provides a 
recent example. In 1996, legislation was enacted to allow a 
one-time special assessment to capitalize the savings 
association insurance fund. It was accompanied by a provision 
to require a refund of reserves in excess of the statutory 
minimum of 1.25 percent of insured deposits. The assessment was 
expected to provide receipts that would reduce the fiscal year 
1997 deficit by $3.1 billion. But that figure was not netted 
against the long-term cost of the refund provision. Under risk-
assumed budgeting, a present-value cost would have been 
assigned to the refund provision, because it increased 
potential taxpayer exposure relative to a scenario in which 
refunds of reserves were not required. This estimate of the 
long-term costs would have provided policymakers a clearer 
understanding of the effect of the legislation.
    Finally, using the accrued cost of insurance programs to 
compute the surplus or deficit would improve those measures of 
the government's fiscal position. Although estimates of accrued 
costs may be imprecise, the committee concurs with GAO that it 
may be better to have imprecise estimates of the true cost of 
Federal insurance programs than to have precise estimates of 
their largely irrelevant cash flows. In addition, the change in 
year-to-year estimates of the accrued costs can aid 
policymakers in designing Federal insurance programs--helping 
them fashion programs that provide insurance assistance at the 
least possible cost to taxpayers.

           Subtitle B--Reports on Long-Term Budgetary Trends

    Current Law. Under current law, the budget process largely 
focuses on the short term: the budget resolution usually 
encompasses the budget year and 4 outyears; the President's 
budget is for 1 year with the 2 outyears provided for 
informational purposes; appropriations bills usually cover a 
single fiscal year; and CBO's baseline usually covers a period 
of 5 fiscal years.
    In recent years there has been interest in expanding the 
time horizon of budget projections for informational purposes. 
OMB includes 10-year projections in the President's annual 
budget submission. CBO began providing 10-year projections on 
its own in the annual Economic and Budget Outlook and update 
reports. Its authority to originate such reports is provided 
under sections 202(e) and (g) of the Congressional Budget Act, 
which authorizes CBO to submit reports that provide information 
needed for the analysis of the Federal budget.
    Additionally, CBO released a report in May 1998 on long-
term budgetary pressures and policy options. On February 25, 
1998, GAO released the most recent of its periodic long-term 
simulations.

    Summary of Proposal. The President would be required to 
include in his budget submission two sets of long-term 
projections: one on the basis of current law; and the other on 
the President's proposed policies. The projections would show 
total levels of surpluses or deficits, and budget authority and 
outlays, with a breakdown by major entitlement program. The 
projections would cover every fifth year over a 75-year period. 
The analysis would also compare the two sets of projections 
with respect to such factors as inflation, foreign investment, 
interest rates, and economic growth. A sensitivity analysis 
would reveal which assumptions the projections are most 
dependent upon.
    The Congressional Budge Office would also be required to 
include, in its annual Economic and Budget Outlook, a 
comparable long-term projection based on current law.

    Purpose of Proposed Change. The purpose of this title is to 
provide policy makers information on the long-term costs of 
major entitlement programs and their impact in aggregate on the 
economy. These reports will focus attention on both the long-
term budgetary problems under current law--such as the 
reemergence of chronic deficits attributable to the retirement 
of the baby boom generation--and the long-term implications of 
alternative policies.
    The value of reporting these projections on a regular basis 
can be understood in reference to GAO's most recent economic 
simulations, which were released in testimony by Paul L. 
Posner, GAO's Director of Federal Budget Issues, to the Senate 
Budget Committee. The GAO figures showed a marked improvement 
in the estimated budget outlook. Budget deficits once were 
projected to reach 10 percent of gross domestic product [GDP] 
by 2016. Under the new estimates, however, deficits are not 
expected to reach that threshold until 2040 (assuming no 
further changes in law).
    Even this improved fiscal posture, however, still is not 
sustainable over the longer term, according to the figures. 
GAO's estimates indicate that Federal budget deficits will 
reemerge when members of the ``baby boom'' generation begin to 
retire in 2015, and will sharply increase until they reach 
unsustainable levels. Mr. Posner noted, these deficits 
translate into significant reductions in national savings, 
private investment, and the capital stock. Ultimately this 
would translate into a decline in GDP and a degradation of 
living standards.
    The recent projections also show the value of maintaining a 
balanced budget. GAO furnished estimates that assumed spending 
reductions or revenue increases necessary to keep the budget in 
balance. The figures showed a decline in consumption over the 
short term, but an increase over the long term. They also 
showed that productivity would increase, though at a lower rate 
than in the past 50 years.
    Longer-range estimates such as these provide important 
perspectives to Members as they weigh various policy options. 
Members should be exposed to such estimates on a regular basis.
    In summary, projections along these lines will begin to 
focus attention on the long-term implications of today's budget 
decisions. They will at least provide policymakers the 
necessary information to make fiscal choices to put the budget 
on a sustainable long-term path. On a more micro level, they 
will provide information on the design of programs that have 
long-term implications but are not suitable for the accrual 
approach taken for insurance programs in Subtitle A. Ultimately 
the hope is that policymakers will process this information and 
take corrective steps in budget policy and program design while 
enabling individuals to adjust to any changes in retirement or 
health benefits.

  TITLE VI--BASELINES, BYRD RULE, LOCK-BOX, AND AUTOMATIC CONTINUING 
                               RESOLUTION


                        Subtitle A--The Baseline

    Current Law. Under both existing law and current scoring 
conventions, the Congress and the administration prepare 
budgetary projections, estimate the costs of legislation, and 
prepare their respective budget documents on the basis of a 
baseline. CBO and OMB prepare baseline projections of Federal 
spending, revenue, and surpluses or deficits that assume no 
change in current law.
    A variety of assumptions underlie baseline projections. For 
mandatory programs, the baseline assumes spending and revenue 
levels consistent with the laws that determine the liability 
for taxes or eligibility for benefits. For estimating the costs 
of legislation under PAYGO, however, section 257 of the 
Emergency Deficit Control Act of 1985 (commonly known as Gramm-
Rudman-Hollings) stipulates that the baseline should assume the 
extension of any program that is greater than $50 million a 
year. For discretionary programs, the baseline may assume 
adjustments for inflation, or compliance with the discretionary 
spending caps.
    The concept of baseline budgeting was first codified as 
part of the Federal budget process by the Congressional Budget 
Act in 1974. The Budget Act required CBO to produce 5-year 
baseline projections and OMB to provide a 1-year projection 
based on a current level of services. The Congress subsequently 
adopted enforcement procedures that depended upon multiyear 
cost estimates. With the enactment of fixed deficit targets in 
1985, the baseline acquired additional importance because it 
was used to enforce budget controls through automatic spending 
cuts in a process known as sequestration.
    In the 104th Congress, House rules were amended to require 
cost estimates prepared by CBO and included in the report 
accompanying every bill to include a comparison to the prior-
year levels (H. Res. 5). Additionally, the Rules of the 
Committee on the Budget were amended to require, as a matter of 
policy, that the committee mark up from prior-year levels. 
Furthermore, committee rules were amended to require the report 
accompanying the budget resolution to include a comparison to 
prior-year levels for each function and budget aggregate.

    Summary of Proposal. Subtitle A stipulates that most 
budgetary information must be presented with a comparison to 
the prior-year levels. Such presentations would include the 
program detail and summary tables in the President's budget, 
summary tables in the joint resolution on the budget, and CBO's 
periodic reports on the budget and economic outlook.
    This title settles the long-time dispute about whether to 
include inflation in discretionary spending. For years when 
discretionary spending limits are in place, the budget 
projections would assume compliance with the limits. After 
these limits expire, these projections would assume 
discretionary spending at the levels of the last year for which 
there were caps.
    All comparisons to prior years would apply to revenues just 
as they do to spending. In the summary tables in the 
President's budget, OMB would be required to compare projected 
changes in revenue under current law, and as proposed by the 
President for both the budget year and each of the outyears, to 
the prior year's estimated levels. The report accompanying the 
budget resolution would likewise compare the appropriate levels 
in the budget resolution to the estimated levels for the 
current fiscal year
    Subtitle A also requires CBO and OMB to prepare annual 
reports on the sources of growth in the baseline. This report 
would calculate the percent of the expected growth in 
government spending that is due to such factors as adjustments 
in inflation, program participation, legislative expansions, 
and the utilization of new technologies.
    This bill does not actually change the construction of the 
baselines that underlie the budget resolution or are used to 
estimate the costs of legislation for purposes of enforcing the 
budget resolution or PAYGO requirements.

    Purpose of Proposed Change. Baselines can play an important 
role in illuminating the financial obligations projected to 
grow from current policies, particularly in the area of 
entitlements. But they often are conceptually flawed, 
inaccurate, and easily manipulated. The goal of this policy 
change is to make policymakers less solely dependent on these 
measures. It is also intended to encourage policymakers to 
address fundamental changes in the base of both mandatory and 
discretionary programs--changes that are otherwise obscured by 
assuming automatic adjustments for inflation.
    The inaccuracy of the baseline was amply demonstrated in 
the 105th Congress, when OMB and CBO underestimated revenues by 
nearly $100 billion. But even long before that, the late 
Professor Aaron Wildavsky challenged the underlying premise of 
using baselines as the benchmark from which budgets are built. 
On May 11, 1992, Professor Wildavsky said in testimony to the 
House Committee on the Budget:

          The idea [of baseline budgeting] is that everybody 
        who has a claim on the Federal Treasury, for whatever 
        reason, deserves not only to get what they had last 
        year in outlays, but to make up for whatever inflation 
        there has been, and therefore, Congress and its Budget 
        Committees have to chase after them to claw money back 
        if that is necessary. It should be the other way around 
        * * * No individual interest has the right to say ``I 
        come first,'' which is to say, everybody gets the 
        outlays that they had and if they want the inflation, 
        then they have to come to you to get it and you in your 
        political wisdom should decide how much of that they 
        should get.

    The uncertainty of baseline projections often is attributed 
to the impact of the economic assumptions from which they are 
formulated--assumptions about economic growth, inflation, 
employment rates, interest rates, and so on. Fractional 
fluctuations in these assumptions can alter budgetary estimates 
by tens of billions of dollars, and these amounts grow 
geometrically over time. For this reason alone, the precision 
of baseline estimates is fundamentally in doubt.
    But even if the economic assumptions turn out exactly as 
predicted, the budget estimates themselves are highly subject 
to uncertainties. A passage in CBO's January 1999 report, The 
Economic and Budget Outlook: Fiscal Years 1999-2008, explains 
why. In describing the factors contributing to the projected 
growth of entitlement spending--and after accounting for 
predictable changes such as caseloads and benefit adjustments, 
the report says:

          The remaining 40 percent to 50 percent of the boost 
        in entitlement spending comes from increases that 
        cannot be attributed to rising caseloads or automatic 
        adjustments in reimbursements. Two sources of growth 
        are expected to become even more important over time. 
        First, Medicaid spending grows with inflation, even 
        though it is not formally indexed. Medicaid payments to 
        providers are determined by the States, and the Federal 
        Government matches these payments. If States increase 
        their benefits to account for inflationary growth, 
        Federal payments will rise correspondingly. Second, the 
        health programs have faced steadily escalating costs 
        per participant beyond the effects of inflation; that 
        trend, which is often termed an increase in 
        ``intensity,'' reflects the consumption of more 
        services per participant and the growing use of more 
        costly procedures. The residual growth in Medicare and 
        Medicaid from both of those sources amounts to $16 
        billion in 1999 and $202 billion in 2008.

    But it is the baseline's susceptibility to rhetorical 
manipulation that has led to calls for an alternative benchmark 
to measure budget proposals. Prof. Allen Schick, in his 1980 
book called Congress and Money: Budgeting, Spending and Taxing, 
described the source of this practice in the following way:

          The baseline assumes that existing programs will 
        continue without policy change. It adjusts projected 
        expenditures for estimated inflation and mandated 
        workload changes. A simple example will show how a 
        baseline is constructed and used. A program spending 
        $100 million a year and projected to have an annual 5-
        percent increase in participants and a 5-percent 
        inflation rate would have approximately a $110-million 
        baseline for the next year, a $121-million baseline for 
        the second year, and a $133-million baseline for the 
        third year. These hypothetical extrapolations are 
        highly sensitive to the assumptions underlying them. 
        Any action projected to reduce spending below these 
        hypothetical levels would be scored as a cutback, even 
        if spending would still be above the previous year's.

    Both the Congress and the President, and both political 
parties, have repeatedly used the baseline to unfairly attack 
their opponents' policies. In 1987, a variety of special 
interest groups attacked the Reagan administra tion for wanting 
to ``cut $50 billion'' from Medicaid and Medicare, when in fact 
it merely proposed to restrain the growth in spending from 9 
percent per year to 6 percent per year. Similar attacks were 
made against Republicans in Congress by Democrats and the White 
House in 1996. Republicans in the 1980's who wanted to 
emphasize deficit reduction could inflate projected savings by 
producing numbers relative to the current services baseline.
    The apparent cost of a given policy often changes with the 
base against which it is measured. Against a rising baseline 
that includes adjustments for inflation, utilization, and other 
factors, a given policy may appear to be a ``cut.'' Compared to 
the actual spending level in the prior year, however, the same 
policy may be depicted as simply slowing the growth in 
spending. This can be seen in Table 9.

         TABLE 9.--EFFECT OF SELECTED BUDGET PROPOSALS: BASELINE CHANGE VS. CHANGE FROM CURRENT SPENDING
                                              [Dollars in millions]
----------------------------------------------------------------------------------------------------------------
                                                                                                     Change from
                                                                Current      Proposed   Budget year    current
                          Proposal                             year level  change from     level         year
                                                                             baseline
----------------------------------------------------------------------------------------------------------------
Medicare Part A $5 Co-Pay for Home Health Services..........     $135,105        -$897     $142,679       $7,574
Medicare Part B $5 Co-Pay for Home Health Services..........       91,919         -613      102,265       10,346
Apply 20% Copayment to Medicare Clinical Lab services.......       83,368         -819       91,100        7,732
Lower Medicaid Match Rate for Administration................      108,129         -270      117,045        8,916
Eliminate Additional Food Stamp & Training Funds............       20,499         -146       21,278          779
Change Federal Contribution to FEHB.........................        4,580         -156        4,801          221
----------------------------------------------------------------------------------------------------------------

    This is more than a rhetorical issue. The perception of a 
policy proposal--especially when rigorously backed up by 
streams of figures bearing the imprimatur of the Congressional 
Budget Office or the Office of Management and Budget--
significantly affects the policy choices made by Congress and 
the President. A reform proposal may be rejected because it 
appears to entail a spending cut (compared to current-law 
projections), when in fact it may only slow the growth of 
spending.
    In addition, policymakers can use baselines to obscure the 
true nature of their actions. In his 1995 book, The Federal 
Budget: Politics, Policy, Process, Professor Schick wrote: 
``The typical deficit reduction results in spending higher than 
the current level but less than the baseline. When this occurs, 
politicians can portray their actions both as a spending cut 
and as a spending increase. They can use the baseline to 
demonstrate that the deficit has been cut, and they can use 
current spending levels to demonstrate that programs have been 
protected.''
    Professor Schick offers the President's 1993 reconciliation 
plan as an example. He notes that, according to CBO, the plan 
entailed $56 billion over 5 years in cutbacks in Medicare, and 
says this result appeared to violate a pledge the President 
made to Congress in introducing his plan on February 17, 1993. 
He notes the President's remark: ``Let me be clear. There will 
also be no new cuts in Medicare.'' Professor Schick then 
explains how baseline budgeting allowed the President to 
reconcile his Medicare cuts with his pledge not to cut 
Medicare:

          About $50 billion [of the reductions] came from 
        reductions in baseline payments to providers, some of 
        which would probably not be counted as cuts if more 
        reasonable standards were used. For example, fees for 
        surgical services were allowed to rise 8.6 percent in 
        1994, far above general inflation and even above 
        medical inflation, but below the 12.2 percent allowed 
        by formula. Payments to hospitals were reduced by 7.4 
        percent, compared to a 10-percent reduction in effect 
        for 1993-1995. The scorekeepers at the Congressional 
        Budget Office recorded this smaller reduction as a 
        multibillion-dollar saving because baseline projections 
        were higher. Several billion dollars more were saved by 
        extending the requirement that Medicare Part B premiums 
        recoup 25 percent of program costs.

    The reform embraced by this proposal does not discard 
baselines; it does not reject their usefulness in portraying 
the potential effects of policy choices. Instead it illuminates 
the budget outlook by broadening the context in which policy 
choices are viewed. By comparing proposals to comparable levels 
in the prior year, Members of Congress will be in a better 
position to assess the real-world impact of the budget as a 
whole and the costs of specific proposals. Moreover, 
policymakers will be more likely to question the underlying 
base of both mandatory and discretionary spending when the 
benchmark is the prior year's level.
    The reports analyzing baseline projections will serve two 
purposes. First, these projections will make it clear that most 
mandatory spending growth is due to factors outside the 
immediate control of the Congress. Most entitlement spending 
growth is due not to recent programmatic expansions, but to 
factors such as the indexation of benefits, changes in 
demographics, and increased access to expensive medical 
technologies.
    Second, identifying the sources of entitlement growth will 
have obvious policy implications as legislators search for 
areas amenable to policy changes.

                       Subtitle B--The Byrd Rule

    Current Law. Under current law, the budget resolution can 
include binding directives on the authorization committees to 
report entitlement or tax legislation that achieves specified 
changes in revenue and mandatory spending. In the Senate, 
reconciliation legislation is entitled to a limitation on 
debate and amendment. Any reconciliation bill reported pursuant 
to such a directive is effectively exempt from filibuster and 
unlimited amendments.
    Because the reconciliation bill is one of the few measures 
not subject to the Senate's supermajority requirements, the 
Senate adopted a rule that strictly limits the types of 
provisions it may include. Any provision that is considered 
``extraneous'' to the reconciliation instructions may be 
stricken from the bill by a two-fifths vote of the Senate.
    Over the years the Byrd rule has been highly controversial 
in the House because it applies to conference reports. House 
conferees have repeatedly agreed to conference reports with the 
Senate only to have key provisions stricken when the conference 
report is considered in the Senate. The House then has little 
choice but to take up the conference report a second time, 
minus the stricken provisions.
    Under the Byrd rule, a provision is defined as 
``extraneous'' if:

- It has no effect on spending or revenue.

- The budgetary effects are ``incidental'' to the underlying 
    provision.

- The provision is part of a title of a bill which, when taken 
    as a whole, does not meet its reconciliation targets.

- It is outside the jurisdiction of the committee that reported 
    it.

- The provision increases revenue or reduces direct spending 
    during a fiscal year not covered by the budget resolution.

- The provision changes the Social Security program.

    As important as the rule itself is, section 313 of the 
Budget Act also includes a number of important exceptions to 
the Byrd rule. Under paragraphs 2 and 3, a provision is not 
considered extraneous if Budget Committee chairman and ranking 
minority member certify that it:

- Mitigates the budgetary effects of the bill.

- Results in a revenue increase or a decrease in direct 
    spending after the interval covered by the budget 
    resolution.

- Is likely to substantially increase or reduce outlays, beyond 
    the levels projected by CBO, as a result of regulations, 
    pending litigation, court rulings, or the relationship 
    between economic indices and indexed benefits.

- Produces an increase in revenue or a decrease in direct 
    spending that currently cannot be estimated.

- Is integral to the underlying provisions.

- Provides an exception or special applications of a general 
    provision.

    Summary of Proposal. This subtitle simply limits the 
application of the Byrd rule to Senate-originated 
reconciliation bills; the rule would no longer apply to 
conference reports. The Byrd rule would otherwise continue to 
apply as it currently does to the Senate-reported bills. The 
provision entails no changes in the definition of 
``extraneous,'' the procedures for making the determination, or 
the number of votes required to waive the rule. The Senate 
would be free to continue using the Byrd rule, as modified, to 
screen Senate bills for measures that Senators deem extraneous.

    Purpose of Proposed Change. Much of the basic rationale for 
eliminating the Bryd rule was first articulated by former House 
Budget Committee Chairman Martin Olav Sabo, who issued a report 
on the Bryd rule in 1994 based on the reconciliation bill in 
1993. Additional reasons have been articulated by House Members 
who participated in conferences in 1995 and 1997.
    First, the Byrd rule confers a powerful advantage on Senate 
conferees over their House counterparts because any provision 
can be killed by 40 Senators who consider it extraneous. It 
allows Senate conferees to force the removal of House-
originated provisions for procedural reasons, rather than on 
the basis of their merits or as part the normal give-and-take 
of negotiations process. Moreover, the House is often forced to 
operate under a narrower interpretation of the rule than is the 
Senate.
    Second, the Byrd rule paradoxically undermines the ability 
of committees and conferees to realize the savings required of 
them through the reconciliation process. The problem arises 
largely because the rule precludes nonscoreable provisions even 
if those provisions are necessary to achieve the reconciled 
savings. Among the examples from Representative Sabo's report 
on the 1993 reconciliation bill (H.R. 2264, as passed by the 
House) were the following:

- A provision designed to reform the subsidy of postal rates 
    for nonprofit organizations, designed to reduce program 
    costs by $192 million, was dropped from a reconciliation 
    bill (sections 10201-10208).

- A provision to consolidate Department of Agriculture 
    personnel and offices to reduce costs by $500 million over 
    4 years (section 1403).

- Another provision to restructure rural electric and telephone 
    loan programs was dropped even though it was designed to 
    save $220 million over 5 years (sections 1201-1202).

- A provision changing cost-of-living adjustments that was 
    estimated to save $40 million over 5 years (sections 10003-
    10004).

    In many such cases the provision in question fails to pass 
the Byrd rule because the savings are not realized until the 
appropriations bills are considered. For instance, a provision 
in the House-passed reconciliation bill in 1995 eliminating the 
Department of Commerce was dropped in conference because it did 
not achieve a reduction in outlays. At the same time, CBO 
estimated that the bill would ultimately save $5 billion over 5 
years. Because the Department of Commerce is subject to 
discretionary appropriations, the savings from eliminating it 
would only be realized when the appropriation bills were 
considered. (Even then it would not be scored as reducing 
outlays, although the resulting discretionary outlays would be 
lower than if the Department of Commerce had not been 
eliminated.)
    Third, the Byrd rule forces Members to distort policies to 
achieve scoreable savings. The ability to draft around the Byrd 
rule, in fact, has become a virtual cottage industry among the 
Offices of the Legislative Counsels in both the House and 
Senate. Former House Budget Committee Chairman Sabo cited one 
example in which a House provision generated savings by 
extending a formula for the Federal Government's contributions 
to the Federal Employees Health Benefits [FEHB] plan. Although 
the provision would have produced significant savings, it was 
not scored by CBO because the extension was already assumed in 
the baseline. Consequently, the conferees had to change the 
formula so that CBO would score it relative to the baseline. In 
another case, a provision authorizing the Federal 
Communications Commission [FCC] to auction rights to the 
broadcast spectrum were made contingent on reallocating the 
spectrum to achieve ``regulatory parity'' in such a way as to 
jeopardize the savings associated with the auction.
    Fourth--and perhaps the most significant objection to the 
Byrd rule--is that it is subjectively applied. Many Members of 
the House might concur with the principle of limiting 
reconciliation to matters related to achieving reconciliation 
targets if they had confidence that the rule would be 
consistently interpreted and applied to both House and Senate 
provisions. But interpretations of the rule have had a tendency 
to vary between House and Senate provisions, over time, and 
even among the staff of the Parliamentarian's Office. House 
Members have cited instances in which Senate conferees insisted 
on dropping certain House provisions as violations to the Byrd 
rule but simultaneously argued that comparable Senate 
provisions were not subject to the point of order.
    Sometimes such discrepancies occur even within the Senate. 
This was the case in 1995, when three studies and one report in 
the Senate-passed bill were identified as Byrd rule violations 
(sections 7205, 7273, and 7274, H.R. 2264) while five other 
studies were retained in the conference report (sections 12101 
and 12345, S.1357, H.Rept. 104-350). Similarly, a demonstration 
project (section 7209, H.R. 2264, as passed by the Senate) was 
dropped under the Byrd rule while the conference report 
included three others (sections 5214, 7002, 12101, H.Rept. 104-
350).
    There exist significant differences over interpretation of 
the Byrd rule even among the relevant Senate staff. In 1995, 
the applicability of the Byrd rule to provisions relating to 
oil drilling rights in the Arctic National Wildlife Reserve 
(section 9002, H.R. 2264, as passed by the House, section 5331, 
H.Rept. 104-350), changes in the Consumer Price Index used to 
adjust certain indexed benefits (section 7481, S.1357, as made 
in order in the Senate), and extension of the Stuart McKinney 
Act (section 5006, H.R. 2491, as passed by the House, section 
6023, H.Rept. 104-350), which provides assistance to the 
homeless, appeared to vary among the staff advising the 
presiding officer on such rulings.
    The subjectivity of the rule is a function of the 
complexity of the rule, the inherent breadth of reconciliation 
measures, the subject matter and the background and perspective 
of those making the Byrd rule determinations. In some cases the 
differences are due to the fact that some are controversial and 
hence assured of the Byrd rule being invoked, and others, while 
clearly subject to the Byrd rule, are noncontroversial and 
hence retained because no Senator will raise the point of order 
(or if one did, the point of order would clearly be waived). 
The requirement that a provision have an effect on outlays is 
complex because the scoring of a given provision is a function 
of underlying assumptions in the budget resolution. In the 
above FEHB example, the initial FEHB provision violated the 
Byrd rule because the change was already assumed in the budget 
resolution and hence it was not scored in the CBO estimate 
(section 10006 in H.R. 2264, as passed by the House, section 
11005 of the accompanying conference report, H.Rept. 103-213). 
Presumably the very same provision would have not been subject 
to the Byrd rule had the extension not been assumed in the 
budget resolution.
    The actual wording of the rule and its exceptions leave 
considerable room for judgement on the part of the 
Parliamentarian. It is the Parliamentarian that determines what 
is ``incidental'' or is considered a ``term'' or ``condition'' 
of a larger proposal. The ability to make such assessments 
invariably depend on the Parliamentarian's background, 
understanding of the legislative provisions, sense of what is 
controversial, and even views toward specific forms of 
governmental intervention.
    Compounding the inherent problems difficulty in applying 
the Byrd rule to specific legislative provisions, it is often 
interpreted by the Chair not on the basis of its legislative 
text, but on the individual Parliamentarian's sense of whether 
the provision is controversial and what the rule was originally 
intended to accomplish. Moreover, there are few actual 
precedents to draw upon. because most provisions are dropped 
before reconciliation conference reports are even filed and 
hence are not actually subject to a points of order under the 
Byrd rule. Faced with an adverse ruling, House conferees have 
little recourse other than to appeal an occasional ruling to 
the Senate Majority Leader. In 1995, a reconciliation 
subconference initially dropped as a Byrd rule violation a 
House-passed provision repealing title V of the Mickey Leland 
McKinney Act which requires the Federal Government to donate 
surplus Federal property, which otherwise would be sold, to 
certain low-income groups. Representative John Boehner appealed 
the decision to Senate Majority Leader Robert Dole and the 
provision was reinstated in a different title of the bill 
(section 5006 in H.R. 2491, section 623, H.Rept.).
    In the absence of a strict interpretation of the law and a 
body of solid precedents, the Senate Parliamentarian tends to 
defer to the Senate Budget Committee staff. This places the 
staff is the untenable position of having to decide which of 
their Members' provisions must be dropped from the 
reconciliation bill. On some occasions staff of the Senate 
Leadership have intervened in the Byrd rule discussions to 
assure specific outcomes. In 1995 a high-level aide to the 
Senate majority leader, who was a nurse by vocation, was 
apparently responsible for the retention of Home nursing 
standards in the conference reports despite the fact that CBO 
attributable no savings to the standards and they were not 
perceived as integral to other Medicare provisions in the 
conference report (section 16001, H.R. 2491, as passed by the 
House, section 7001 of the accompanying conference report, 
H.Rept. 104-350).
    Finally, the Bryd rule also consumes an enormous amount of 
time that could be be better spent on legislative and oversight 
functions. In turn, as former House Budget Committee Chairman 
Sabo once noted: ``* * * enforcement of the [Byrd] rule 
requires that too much power be delegated to unelected 
employees of the Congress.'' Members of Congress and their 
staffs spend weeks going through, literally, line by line, 
potential provisions in reconciliation bills and conference 
report. Moreover the Byrd rule imposes upon the House the 
burden of having to take up the conference report a second time 
when provisions are stricken under the Byrd rule. In 1994, the 
House was forced to pass conference report accompanying the 
pending reconciliation bill twice because two provisions were 
struck from it in the Senate after the House had already agreed 
to the original version of the conference report. If the 
stricken provisions are critical to compromises reflected in 
the initial conference report, then the entire bill may have to 
be renegotiated. At the very least, the House is forced to 
consider a second rule providing for consideration of the 
stripped down reconciliation bill, and debate and vote on the 
conference report itself.

              Subtitle C--Spending Accountability Lock-Box

    Current Law. Under current congressional procedures, 
Members offering floor amendments that reduce appropriations 
have no way of guaranteeing that the savings actually will be 
saved. The reduction can be used to increase spending in 
another program in the appropriations bill, or in another 
appropriations bill.
    Under section 301 of the Congressional Budget Act, the 
conference report accompanying the budget resolution assumes 
aggregate levels of discretionary budget authority and outlays 
spread across 19 separate budget functions. Pursuant to section 
302(a) of the Budget Act, the accompanying joint statement of 
the managers must be crosswalked in the form of an allocation 
to the Committee on Appropriations.
    Upon the adoption of the conference report, the 
Appropriations Committee is required to suballocate this lump 
sum among its 13 subcommittees as part of its 302(b) 
allocations. The House and Senate are prohibited from 
considering any bill--and the Appropriations Committee may not 
bring a bill to the floor--until the suballocations have been 
made. These suballocations are effectuated by a vote of the 
Appropriations Committee, which is subject to amendment and 
which is published in the Congressional Record. After the 
Appropriations Committee has issued its 302(b) allocations, the 
House is prohibited from considering any bill that would exceed 
a subcommittee's suballocation. The Appropriations Committee is 
permitted to change its 302(b) suballocations at any time, as 
long as the change is formally acted upon by the full 
committee.
    Under this process, the Appropriations Committee typically 
brings bills to the floor that provide the maximum level of new 
budget authority permitted under its suballocations. One 
implication of this practice is that any amendment increasing 
new budget authority would exceed a subcommittee's 
suballocation, and would be subject to a point of order. Any 
amendment that reduces new budget authority, however, frees up 
room under the suballocations for subsequent amendments 
increasing budget authority in that bill. Moreover, if an 
amendment reduces appropriations below the 302(b) suballocation 
and the overall level of budget authority is not increased in 
subsequent amendments, the Appropriations Committee can 
effectively capture the savings by decreasing the 
subcommittee's 302(b) and increasing that of another 
subcommittee by the same amount.

    Summary of Proposal. Subtitle C establishes a process 
whereby the sponsors of amendments reducing discretionary 
spending can ensure that such reductions, if agreed to, lead to 
an overall reduction in spending. In a deliberate bias toward 
lower spending, the bill reduces all applicable spending limits 
unless the sponsor of the amendment indicates otherwise. The 
lock-box process applies to both the allocations and aggregates 
for congressional purposes, and to the discretionary spending 
limits, if any, for purposes of sequestration.
    The underlying mechanism is fairly simple. Whenever an 
amendment is offered on the floor, the sponsor is permitted to 
indicate the proposed use of any savings from the amendment. 
There are three options: first, reduce net discretionary 
spending; second, increase spending for another program within 
the bill; or third, increase spending for a program in another 
regular appropriations bill. If the sponsor fails to indicate 
any of the three, then the savings are automatically used to 
reduce all budget limits.
    After the bill comes out of conference, the allocations and 
aggregates are reduced by the average of the amount in the 
lock-box for the House-passed and Senate-passed bills. In 
choosing among various priorities in a conference report, 
conferees are expected to select a mix of funding levels for 
each program, project, or activity consistent with the 
reduction in the appropriate budget levels and the 
discretionary spending limits that will result from the 
conference reports.
    The Budget Committee chairmen actually make the adjustments 
in the budget resolution's allocations and 302(a) allocations 
for their respective Houses. The chairmen are required to keep 
running totals of the amounts in the lock-box from floor 
amendments and execute the adjustments--by way of a letter in 
the Congressional Record--after the bill is considered or the 
conference report passed.
    After the conference report is enacted into law, the 
Director of OMB is required to make the adjustments in 
discretionary spending limits.

    Purpose of Proposed Change. The purpose of the lock-box is 
to provide Members a mechanism for ensuring that total 
discretionary spending is reduced by the amount of savings from 
floor amendments. Implicit in the lock-box concept is the 
assumption that during the amendment process, the Congress as a 
whole should have the ability to reduce the allocations, but 
only by the amount of the savings estimated to result from the 
amendment.
    The lock-box is not intended to deny the Appropriations 
Committee its basic right to determine the 302(b) allocations. 
Instead, it is intended to make Appropriations Committee 
members and conference committees responsive to the will of 
rank-and-file Members in each House, as reflected in the 
amendment process.
    By providing an automatic reduction in the allocation and 
caps if the sponsor does not designate the savings for another 
program, the bill intentionally promotes a bias toward lower 
spending.

              Subtitle D--Automatic Continuing Resolution

    Current Law. Section 9 of Article 9 of the U.S. 
Constitution provides that: ``No Money shall be drawn from the 
Treasury but in Consequence of Appropriations made by Law.'' 
About 32 percent of the Federal budget is controlled through 
annual discretionary appropriations. Appropriations for most 
government functions are provided in 13 appropriation bills. 
These acts provide the legal authority to incur new obligations 
and make payments from the Treasury for specified purposes. 
Most appropriations acts cover a single fiscal year, although 
for selected programs appropriations are provided in advance or 
for a multiyear period.
    Once an appropriations bill is enacted, OMB is required 
under the Anti-Deficiency Act of 1905 (Public Law 58-217, 33 
Stat. 1214) to apportion, by function and time period, the 
amount of budget authority that may be obligated by function 
and time period. This is usually done on a quarterly basis. 
Executive branch officials are expressly prohibited from 
incurring an obligation before an appropriation or in excess of 
amounts appropriated or apportioned.
    If an appropriations bill is not enacted for a given 
agency, program, or activity by the beginning of a fiscal year, 
then the agency has no authority to incur obligations and make 
payments from the Treasury. Prior to 1980, government agencies 
continued to operate at an interim basis during such lapse of 
appropriations. Federal employees were required to continue 
reporting to work on the assumption that Congress did not 
actually intend that the Federal Government shut down while 
agencies waited for the enactment of appropriations.
    In 1980 Attorney General Civeletti issued two opinions that 
radically changed the posture of the Federal Government during 
an appropriations lapse. His first opinion interpreted a 
provision of the Anti-Deficiency Act that dated from 1870 as 
precluding Federal workers from working during a shutdown (41st 
Cong. Ch. 251, 16 Stat. 230). In his second opinion, Mr. 
Civeletti stipulated that during an appropriations lapse, the 
only obligations that could be incurred were: those authorized 
for mandatory programs such as Social Security; those 
concerning the discharge of the President's constitutional 
powers, such as the President's role as Commander-in-Chief of 
the Armed Forces; those for emergencies involving the safety of 
human life and the protection of property; and those needed to 
bring about the orderly termination of an agency.
    In 1990 the Anti-Deficiency Act was amended to narrow the 
exception for emergencies by clarifying that ``the term 
``emergencies'' did not include ongoing, regular functions of 
government the suspension of which would not imminently 
threaten the safety of human life or the protection of 
property.''
    To avoid a lapse in appropriations that would lead to a 
government shutdown, continuing resolutions [CRs] are usually 
enacted to provide interim spending authority. These interim 
appropriations may be for as short a period as a single day or 
week, while Congress and the President continue to negotiate on 
the regular appropriation bills. Frequently multiple CRs are 
enacted before agreement is reached on the final appropriation 
bills. On very rare occasions, continuing resolutions for 
certain activities have lasted an entire year.
    Continuing appropriations often are based on simple 
formulas--such as some percentage of the prior-year's level, 
the lower of the House- or Senate-proposed levels, or the lower 
of the House or Senate levels and the prior-year's level. 
Because continuing resolutions are usually written for short 
periods, they generally limit appropriations to a certain rate, 
rather than levels, so that the agencies will not apportion the 
funds too rapidly.
    Continuing resolutions have become common over the past 47 
years. During the period of 1952 through 1998, CRs have been 
enacted for all but 4 fiscal years (fiscal year 1953, fiscal 
year 1989, fiscal year 1995, and fiscal year 1997). In most 
years, more than one CR was needed as Congress worked to 
complete action on the regular appropriations bills. The number 
of CRs enacted during the period ranged from zero to six, 
except for fiscal year 1996, when 14 separate measures 
providing continuing appropriations were enacted. In some 
years, especially during the 1980's, the final CR provided 
funding for one or more of the regular appropriations bills for 
the remainder of the fiscal year [see Table 10].

                     TABLE 10.--REGULAR APPROPRIATIONS BILLS AND CONTINUING RESOLUTIONS [CR]
                                            [Fiscal years 1977-1999]
----------------------------------------------------------------------------------------------------------------
                                                  Continuing resolutions        Regular appropriations bills
                  Fiscal year                             enacted                      included in CR
----------------------------------------------------------------------------------------------------------------
1977..........................................                       \1\2                                     0
1978..........................................                          3                                     1
1979..........................................                          1                                     1
1980..........................................                          2                                     3
1981..........................................                          2                                     5
1982..........................................                          4                                     4
1983..........................................                          2                                     7
1984..........................................                          2                                     3
1985..........................................                          5                                     8
1986..........................................                          5                                     7
1987..........................................                          5                                    13
1988..........................................                          5                                    13
1989..........................................                          0                                     0
1990..........................................                          3                                     0
1991..........................................                          5                                     0
1992..........................................                          4                                     1
1993..........................................                          1                                     0
1994..........................................                          3                                     0
1995..........................................                          0                                     0
1996..........................................                         14                                     6
1997..........................................                          0                                     0
1998..........................................                          6                                     0
1999..........................................                          6                                     0
----------------------------------------------------------------------------------------------------------------
\1\ The two CRs did not provide continuing funding for entire regular bills; instead, they provided funding for
  selected activities.

SOURCES: U.S. Congress, Senate Committee on Appropriations, ``Appropriations, Budget Estimates, Etc.,'' 94th
  Cong., 2d sess.-103d Cong., 2d sess. (Washington: GPO, 1976-1994). U.S. Congress, House, ``Calendars of the
  U.S. House of Representatives and History of Legislation,'' 104th Cong., 1st sess., 105th Cong., 2d sess.
  (Washington: GPO, 1995-1998).

    Summary of Proposed Change. This bill provides for an 
automatic continuing resolution for any program, project, or 
activity for which an appropriations bill has not been agreed 
to by the beginning of the fiscal year. The continuing 
appropriation covers every program or activity that was funded 
in an appropriation in the prior fiscal year, if the regular 
appropriations act covering that activity has not been enacted. 
No appropriation would be provided for a new program or 
project; funding for a new program, or the discontinuation of 
funding for an existing program, could only occur through 
enactment of a specific appropriations act.
    The interim continuing appropriation for each program and 
project would be at the prior year's level. If a regular 
appropriation were passed, then its funding levels would 
replace those of the continuing resolution. There are no 
exceptions for funding selected programs at higher levels--
although separate legislation could always be enacted to 
accommodate such programs.
    The actual appropriation is in effect the first day on 
which there is a lapse in appropriations until a regular 
appropriation is enacted.
    Any conditions or limitations in effect in the prior year 
would remain in effect under the continuing resolution. For 
example, the fiscal year 1999 appropriations bill for Labor, 
Health and Human Services, Education, and Related Agencies 
included the following conditions and limitations:

- That notwithstanding any other provision of law, funds made 
    available under this heading may be used to continue 
    operating the Council on Graduate Medical Education 
    established by section 301 of Public Law 102-408. (Health 
    Resources and Services Administration.)

- That none of these funds shall be used to pay recipients of 
    the general research support grants program any amount for 
    indirect expenses in connection with such grants. (National 
    Center for Research Resources.)

- That the Director may direct up to 1 percent of the total 
    amount made available in this or any other Act to all 
    National Institutes of Health appropriations to activities 
    the Director may so designate.

- That of the amount provided, $300,000 shall be for the 
    Philadelphia City-wide Improvement and Planning Agency. 
    (Substance Abuse and Mental Health Services.)

- That funds appropriated under this heading may be obligated 
    to increase Medicare provider audits and implement the 
    Department's Health Care Financing Administration's 
    oversight of Medicare. (Health Care Financing 
    Administration.)

- During fiscal year 1999, no commitments for direct loans or 
    loan guarantees shall be made. (Health Maintenance 
    Organization Loan and Loan Guarantee Fund.)

- That no funds shall be awarded to a State Council under 
    section 112(f) of the Carl D. Perkins Vocational and 
    Applied Technology Education Act, and no State shall be 
    required to operate such a Council. (Vocational and Adult 
    Education)

- None of the funds contained in this Act shall be used to 
    require, directly or indirectly, the transportation of any 
    student to a school other than the school which is nearest 
    the student's home, expect for a student requiring special 
    education, to the school offering such special education. 
    (Department of Education.)

    If such provisions were enacted in the prior year's regular 
appropriations bill, they would remain in place in the 
automatic continuing resolution.
    The bill provides that once the regular appropriations 
bills are agreed to, the continuing appropriation is charged to 
the relevant appropriation, fund, or activity. This means that 
the funding provided by the continuing resolution is not in 
addition to the regular appropriation. Once the regular 
appropriations bill is enacted, it replaces the continuing 
resolution as the authorization for incurring obligations to 
operate the program or activity. All obligations incurred under 
the continuing resolution are, therefore, liquidated by the 
funds provided by the enacted appropriations bill. Language 
similar to this has routinely been included in continuing 
resolutions for many years.
    For instance, if the Commerce-Justice-State and the 
Judiciary appropriations bill is not enacted by the beginning 
of the fiscal year, the continuing resolution would provide 
funding at the previous year's level for all programs and 
activities included in the previous year's appropriation until 
the regular current year's appropriation is enacted. No new 
programs or activities could be started and none could be 
eliminated. Upon enactment of the regular appropriation, all of 
the obligations incurred under the continuing resolution for 
the programs and activities covered by the bill would be 
transferred to the regular appropriations bill. In this way, 
the programs and activities covered by the continuing 
resolution do not receive a windfall.
    In those instances in which the regular appropriations bill 
reduces the funds available to the program or activity below 
the level of the continuing resolution, the agency is expected 
to adjust subsequent spending to comply with the lower funding 
level. When the funding level is reduced to a level at which it 
is impossible for the subsequent spending to be reduced to 
bring total spending into compliance with the level in the 
regular appropriations bill, the Comptroller General has 
consistently ruled that the continuing resolution provides the 
authority for the excess obligations incurred prior to the 
enactment of the regular bill.
    The bill covers the following categories and activities:

- Agriculture, rural development, and related agencies.

- The Departments of Commerce, Justice, and State; the 
    judiciary; and related agencies.

- The Department of Defense.

- The government of the District of Colombia.

- The Departments of Labor, Health and Human Services, and 
    Education; and related agencies.

- The Departments of Veterans Affairs and Housing and Urban 
    Developments; and selected independent agencies, boards, 
    commissions, corporations, and offices.

- Energy and water development.

- Foreign operation and related programs.

- The Department of the Interior and related agencies.

- Military construction.

- The Department of Transportation and related agencies.

- The Department of the Treasury; the Postal Service; the 
    Executive Office of the President; certain independent 
    agencies; and the legislative branch.

    The bill would not affect programs with permanent 
appropriations, such as Medicare and Social Security.
    For appropriated entitlements, the continuing resolution 
also would provide the prior year's funding, but would not 
affect recipients'' entitlement to specified benefits. Any 
claimants denied their specified benefits could seek redress in 
the courts and theoretically collect a judgment from the claims 
and judgment account, which is a permanent appropriation.

    Purpose of Proposal. The primary purpose of the automatic 
continuing resolution is to prevent a government shutdown 
during an appropriations lapse. In avoiding a government 
shutdown, an automatic continuing resolution will ensure the 
continuation of government services; prevent the temporary 
dislocation of Federal workers; and provide for a more rational 
and deliberate debate over spending priorities.
    The government shutdowns in 1995 and 1996 caused large 
furloughs of Federal employees without pay. In the first 
shutdown--beginning on November 14, 1995--more than 800,000 
employees were furloughed for 6 days. In the second shutdown, 
in December of that year, 260,000 employees were furloughed for 
21 days--by far the longest running government shutdown.
    Aside from the obvious effect on employee productivity, the 
shutdowns had adverse effects on morale, particularly when the 
shutdowns occurred during the end-of-the year holiday season. 
Moreover, the impact of the shutdowns was disproportionately 
felt at the lower ends of the GS scale, which consists of 
personnel less likely to have significant savings.
    Both Congress and the President have used the threat of a 
government shutdown to extort concessions from the other side. 
During the 104th Congress, the Congress used the threat of a 
shutdown to try to force the President to agree to tax cuts and 
significant reductions in discretionary spending. Last year, 
the President used the threat of a shutdown to win higher 
levels of discretionary spending--but not without the Congress 
wrangling large increases in defense spending.
    Eliminating the potential for government shutdowns will 
not, however, eliminate eleventh-hour wrangling over 
appropriations near the end of a fiscal year. If the priorities 
of Congress and the President differ, their differences will 
continue to appear in appropriations bills, and they will have 
to keep negotiating. But the continuing resolution will protect 
third parties--specifically government employees and citizens--
from paying the price for what is essentially a political 
disagreement.
    Nor will the parties lose their incentive to reach 
agreement. Both Congress and the President will still want 
their priorities expressed through appropriations bills; and to 
the extent their priorities differ, they will still need to 
negotiate them. They simply will not put government operations 
at risk if they fail to agree.
    Finally, this continuing resolution is evenhanded. Neither 
the President nor the Congress has an advantage as negotiations 
continue. With the continuing resolution set at the prior 
year's level, the President will be unable to threaten a 
shutdown to demand huge increases--as was the case in 1998--and 
the Congress will be unable to force huge cuts in spending. 
Moreover, neither side will be able to use the must-pass CR as 
a vehicle for controversial legislation that would not pass on 
its own merits in a freestanding bill.

              TITLE VII--BUDGETING IN AN ERA OF SURPLUSES

    Current Law. As part of the Omnibus Budget Reconciliation 
Act of 1990, a pay-as-you-go [PAYGO] requirement was 
established for all tax and entitlement legislation. Under 
PAYGO, any increase in the deficit from the enactment of 
legislation reducing revenue or increasing direct spending must 
be offset by enacted legislation that increases revenue or 
reduces direct spending. PAYGO does not discriminate between 
changes in revenue and spending: tax cuts can be offset with 
reductions in direct spending or increases in revenue; and 
increases in direct spending may be offset by increases in 
revenue or decreases in direct spending.
    If the sum of all PAYGO legislation is not offset in the 
budget year, then the spending levels of all nonexempt 
entitlement programs for that year are automatically reduced, 
through a process known as sequestration. Programs exempt from 
this provision include Social Security, Medicaid, and certain 
veterans' benefits. Certain other programs, such as Medicare, 
may not be sequestered by more than a specified amount.
    PAYGO legislation must be offset in each of 5 fiscal years, 
but is enforced only 1 year at a time. After Congress adjourns 
for a session, OMB determines whether there is a net cost from 
all PAYGO legislation in the fiscal year that began on October 
1 of that calendar year. If Congress adjourns on November 1 of 
calendar 1999, then a sequester is applied against fiscal year 
2000 spending levels. If legislation enacted at the end of 
October reduced revenue or increased direct spending in fiscal 
year 2001, legislation could be enacted over the following 12 
months to avoid a sequester in the following fiscal year.
    PAYGO currently applies to new legislation through fiscal 
year 2002. Such legislation, however, must be offset for a full 
5 fiscal years. For legislation enacted in fiscal year 2002, 
the PAYGO procedure extends through fiscal year 2006.

    Summary of Proposal. This title modifies pay-as-you-go 
[PAYGO] requirements to permit tax and entitlement legislation 
reducing taxes or increasing direct spending to be offset by 
the on-budget surplus. Under current law, such legislation must 
be fully offset by subsequent tax and entitlement legislation 
regardless of whether there is an on-budget deficit. Title VII 
would require offsets for tax and entitlement legislation only 
to the extent the costs of such legislation exceeded the on-
budget surplus.
    To achieve this end, the bill changes the formula for 
determining the need for, and size of, any sequester. As 
currently interpreted by OMB, a PAYGO sequester is triggered 
for the budget year in the amount that the sum of all tax and 
entitlement legislation would either increase the deficit or 
reduce the surplus. As modified by this bill, a PAYGO sequester 
would only be triggered if the cost of new tax and/or 
entitlement legislation for the budget year was greater than 
the on-budget surplus for that budget year. If, for example, 
OMB estimated an on-budget surplus of $70 billion for a given 
fiscal year, Congress and the President could enact up to that 
amount in any combination of tax cuts or entitlement increases 
without having to enact offsets to avoid a sequester. They 
would, however, still be required to find offsets for any PAYGO 
legislation that cost in excess of $70 billion.
    In recognition of the changing nature of projected 
surpluses, however, the bill requires reestimates of the 
surplus at the beginning of each year to determine if 
additional offsets are necessary to prevent the Federal 
Government from running an on-budget deficit. In the above 
example, if $70 billion in tax cuts were enacted, and the 
projected surplus, when reestimated, declined from $70 billion 
to $65 billion, then Congress and the President would have to 
enact an additional $5 billion in offsets or face a sequester 
in that amount--because the net result would be an on-budget 
deficit of $5 billion without the offsets.
    Because the purpose of PAYGO is not to trigger a sequester 
but to encourage the enactment of offsetting legislation, the 
bill further modifies PAYGO procedures to provide the Congress 
and the President a full session of Congress to enact the 
necessary offsets to prevent a sequester. A snapshot of the 
surplus would be taken when the President submits his budget in 
January or early February. From this estimate of the surplus, 
the Congress and the President could then work through the 
regular budget process to enact additional offsets.
    As a special precaution against a sequester, the bill 
creates a special procedure to facilitate the enactment of the 
necessary offsets for PAYGO legislation. If on October 15, OMB 
notifies Congress that a sequester will be triggered when it 
adjourns, the House can quickly pass a simple resolution 
directing the authorizing committees to submit to the Budget 
Committee legislation offsetting the PAYGO legislation. Such 
legislation could be quickly considered on the floor under the 
expedited procedures accorded budget resolutions and 
reconciliation bills.
    There are three important elements to this modest change in 
PAYGO.
    First, it in no way prejudges what should be done with the 
on-budget surplus--whether to use it to reduce the debt, cut 
taxes, or increase direct spending. It simply gives the 
Congress and the President the ability to decide whether some 
or all of the on-budget surplus should be used to offset PAYGO 
legislation on a bill-by-bill basis. Congress and the President 
would be completely free to offset tax cuts or direct spending 
initiatives and thereby preserve the surplus for deficit 
reduction. Conversely, they might opt not to offset tax cuts or 
direct spending increases and thereby implicitly finance such 
measures out of the surplus.
    Second, it will allow both the Congress and the President 
to reassert their respective roles in determining budgetary 
priorities in a post-balanced budget environment. In the 
absence of chronic deficits, Congress and the President should 
be free to determine the appropriate levels of Federal taxation 
and spending without artificial budget constraints. Moreover, 
if these constraints are not adapted to the current fiscal 
environment, then they will be unilaterally waived as was 
implicitly assumed in the President's budget submission for 
fiscal year 2000.
    Third, this title preserves the PAYGO discipline whenever 
there is an on-budget deficit or the bill would result in an 
on-budget deficit. Instead of repealing PAYGO, the bill would 
require offsets for tax and spending legislation should the 
Federal Government begin to run deficits. If, for example, OMB 
were to estimate a surplus for fiscal year 2001 next January, 
then the Congress and the President would have to fully offset 
the costs of any PAYGO legislation in that year.
    Finally by requiring offsets when there is an on-budget 
deficit, the bill effectively acts as a Social Security lock-
box. That is, it requires legislative offset for any enacted 
tax and entitlement bills that would otherwise be implicitly 
financed out the Social Security surplus. This arises from the 
fact any PAYGO legislation implicitly financed out of the 
surplus receipts coming into the Old Age and Survivors 
Insurance and Disability Insurance [OASDI] trust funds would 
have to be offset--so that, in fact, they would not be financed 
out of OASDI surpluses. [See Table 11.]

   TABLE 11.--EXAMPLE OF HOW THE ON-BUDGET SURPLUS WOULD BE PROTECTED
                          [Dollars in billions]
------------------------------------------------------------------------
                                                    Fiscal year
                                         -------------------------------
                                               2001            2002
------------------------------------------------------------------------
Projected On-Budget Surplus.............             $20             $20
Changes to Surplus Estimate:
    Major Legislation...................             -10             -10
    Economic Changes....................             -10             -15
Revised On-Budget Projections...........               0              -5
Amount to be offset through legislation                0               5
 or sequestration.......................
------------------------------------------------------------------------

    Purpose of Proposed Change. The emergence of on-budget 
surpluses and projected near-term unified surpluses has called 
into question the need to require that tax cuts and direct 
spending increases be fully offset. PAYGO was imposed in 1990, 
and extended in 1993 and 1997, as an interim requirement to 
prevent increases in the deficit. Many in Congress believe that 
the surpluses should be returned to the taxpayers in the form 
of tax cuts. Others believe Congress should take advantage of 
the surpluses to make selected ``investments'' in areas such as 
education, research and development, health care, and the like. 
Another group believes that some or all of the non-Social-
Security surplus should be used to reduce the Federal debt. 
Still others believe the PAYGO requirement should be restricted 
to entitlement initiatives such that only entitlement 
initiatives have to be offset and that the offset must consist 
only of reductions in entitlement spending.
    Despite this range of views, the various parties appear to 
agree on two points: PAYGO should be preserved in a way that 
keeps the unified budget in balance; and Congress and the 
President should be permitted to decide what to do with the 
non-Social-Security part of the budget. Moreover, both sides 
are conscious of the volatility of current estimates and the 
projected emergence of long-term surpluses when the retirement 
of the baby boom begins to strain sources of available revenue. 
On the basis of this consensus, this bill stipulates that all 
tax cuts and entitlement initiatives must be offset if they 
would cause an on-budget deficit. It further provides that 
Congress and the President can decide, when there is an on-
budget surplus, whether or not to offset any tax cuts or 
entitlement initiatives. Finally, it requires additional 
offsets if the decision is made to offset legislation with the 
surplus and the surplus fails to materialize.
    The only policy bias in this reform is that it prevents the 
Congress and the President from financing tax cuts or 
entitlement initiatives out of the Social Security surplus. The 
bill is neutral on whether the non-Social Security surplus 
should be used for debt reduction, tax cuts, or entitlement 
initiatives. Nothing in the bill prevents the Congress and the 
President from preserving the surplus by offsetting all 
initiatives. Nothing in the bill prevents Congress from using 
offsets for entitlement increases but not for tax increases, or 
vice versa.
    Because the bill preserves the PAYGO discipline, even 
advocacy groups with a bias toward debt reduction either 
support this reform outright or are neutral on it. In testimony 
on the bill before the Rules Committee, Martha Philips of the 
Concord Coalition noted that:

          H.R. 853 allows for the use of ``rest of government'' 
        surpluses. Concord does not oppose this provision. 
        However, we are concerned that spending increase or tax 
        cut commitments might be made in anticipation of budget 
        surpluses that either do not materialize at all or are 
        not as large as expected. The authors of the bill have 
        anticipated this by providing that if legislation is 
        enacted that exceeds the actual surpluses, a sequester 
        will occur unless the shortfall is made up.

    Virtually every player in this year's budget debate needs a 
change in PAYGO requirements to implement their budgetary 
priorities. The President needs a PAYGO change because he uses 
tax increases (mostly from a tax on cigarettes) and changes in 
other mandatory programs to help pay for a $30-billion increase 
in discretionary spending as proposed in his budget submission 
for fiscal year 2000. The conference report accompanying the 
congressional budget resolution for fiscal year 2000 assumes a 
tax cut of $778 billion, financed out of the on-budget surplus. 
Similarly, the Democratic alternative in the House requires a 
PAYGO change to finance its tax cut of $116 billion out of the 
on-budget surplus.
    In looking at the purpose of reforming PAYGO, the bill 
preserves the PAYGO discipline in an era of budget surpluses. 
Both PAYGO and the discretionary spending limits were enacted 
as temporary measures to reduce the deficit. They contributed 
significantly to balancing the budget. As explained by Rudolph 
G. Penner, former Director of CBO, the challenge of this post-
balanced-budget era is the following:

          [T]o retain the discipline imposed by pay-as-you-go 
        while allowing the surplus to be used for spending 
        increases or tax cuts. PAYGO rules were clearly 
        designed for an era of deficit. They are no longer 
        appropriate and probably cannot survive without 
        modification.

    With all parties assuming a change in PAYGO this year, this 
bill permits the rank and file in Congress, the authorizing 
committees, and the President to decide whether they want to 
offset tax initiatives on a bill-by-bill basis. If PAYGO is not 
changed proactively, it will inevitably be changed or waived 
during the rush to adjourn--probably by a select group of 
congressional leaders and administration officials, with little 
input from other Members. OMB Director Jacob J. Lew admitted as 
much in a communication with the Committee on Government 
Affairs in which he stated: ``We believe that allocation of 
projected surpluses should be carefully deliberated in the 
context of a comprehensive budget framework, and oppose 
changing the pay-as-you-go rules at this time.''
    Finally with the budget debate having largely shifted from 
reducing deficits to preserving Social Security surpluses, this 
title effectively prevents the Congress and the President from 
enacting legislation financed by the Social Security surpluses. 
By requiring offsets for tax and direct spending legislation 
when the non-Social Security part of the budget is in deficit, 
Title VII effectively prevents the Federal Government from 
borrowing from the Social Security trust funds to pay for tax 
cuts or entitlement initiatives.
                          Legislative History

                              ----------                              


                              INTRODUCTION

    The broad, bipartisan character of this legislation is 
reflected by the long and varied support for its concepts. 
Efforts to improve the process by which Congress handles 
trillions of dollars of public money every year have been 
introduced in Congress after Congress by Members of both 
parties. As Representative Jim Nussle noted in his testimony to 
the Senate Budget and Governmental Affairs Committees, this 
bill draws on the expertise and hard work of those Members, who 
established the foundation on which Representative Nussle, 
Representative Benjamin L. Cardin, and Representative Porter J. 
Goss crafted the legislation. It was the job of the Budget 
Committee's Task Force on Budget Process Reform, working with 
the Committee on Rules, to sort through these proposals and 
draft a cohesive and comprehensive bill.
    The bill is the immediate product of a majority of both 
Republicans and Democrats that served on the Budget Committee's 
Task Force on Budget Process Reform in the 105th Congress: 
Chairman Nussle, Ranking Minority Member Cardin, 
Representatives Radanovich, Sununu, Minge, and Granger. 
Representatives Cardin and Minge played an especially 
courageous role in crossing partisan lines to craft a balanced 
and bipartisan bill.
    No Member in the House has contributed more to budget 
process reform than Representative Christopher Cox, who has 
long championed the crown jewel of this bill: the joint budget 
resolution. As an indication of its bipartisan support, the 
joint resolution also draws on legislation introduced by 
Representative Cardin; Representative John M. Spratt Jr., the 
ranking minority member on the Budget Committee; and former 
Representative Leon E. Panetta, a previous chairman of the 
Budget Committee.
    Together with Representative Joe Barton, Representative Cox 
also chaired, during the 105th Congress, the Speaker's Task 
Force on Budget Process Reform, which urged the Budget 
Committee to address such contentious issues as the automatic 
continuing resolution and modifying pay-as-you-go [PAYGO]. 
Representative Barton introduced his omnibus budget process 
bill, H.R. 2293, in the 106th Congress on June 22, 1999.
    In the area of emergencies, the bill borrows heavily on the 
reserve fund concept for emergencies that was introduced and 
refined over the years by Representative Michael N. Castle. 
Similarly, the automatic continuing resolution in the bill is a 
testimony to the tireless efforts of Representative George W. 
Gekas. The subtitle on baselines was taken directly from a 1994 
floor amendment offered by former Representative Timothy J. 
Penny together with Representative John R. Kasich, the current 
Budget Committee chairman, and Representative Charles W. 
Stenholm, one of the House's foremost leaders in efforts to 
balance the Federal budget and reform the budget process.
    The expansion of budget rules to nonreported bills was 
taken from a bill originally offered in 1993 by Representative 
John Joseph Moakley, currently the ranking minority member on 
the Rules Committee. The curbs imposed on the so-called Byrd 
rule in 1994 were derived from a bill originally introduced by 
Representative Martin Olav Sabo when he was chairman of the 
Budget Committee. Finally, the sunsetting provisions are the 
legacy of Senator Edmund S. Muskie, who believed that no 
program was above periodic review, and House Members such as 
Minority Leader Richard A. Gephardt, former Representative 
Norman Y. Mineta, and Representative Lloyd Doggett, who has 
reintroduced the bill.
    Much of the credit for this bill also goes to former Rules 
Committee Chairman Gerald B. H. Solomon, a long-time student of 
the budget process who retired after the conclusion of the 
105th Congress. Representative Solomon first approached 
Chairman Kasich on the House floor in late 1997 and suggested 
that the two committees work together on a comprehensive reform 
package.
    Mr. Solomon's efforts were taken up in the 106th Congress 
by current Rules Committee Chairman David Dreier, under the 
leadership of Representative Goss, the chairman of the Rules 
Committee's Subcommittee on Legislative and Budget Process. The 
Budget and Rules Committees worked closely to interweave 
legislative procedures and budgetary controls to establish a 
new model for making yearly budget decisions. Without the 
participation of the Rules Committee, the bill would not 
contain such critical elements as requiring periodic 
reauthorization, and the lock-box.
    Finally--but not least important--was the role of Budget 
Committee Chairman Kasich, who appointed the Task Force and 
advised Task Force Chairman Jim Nussle to work with Democrats 
on and off the committee in drafting a bill. In addition to his 
legislative efforts in the areas of joint resolutions, 
baselines, budget enforcement, entitlements, emergencies, and 
expedited rescissions, Chairman Kasich intervened at several 
critical junctures in the development of this bill to resolve 
key problems that threatened the coalition of interests 
supporting the bill. He then moved the bill through the full 
Budget Committee. Moreover, it was Chairman Kasich who had 
previously secured jurisdiction over the budget process, so 
that the Budget Committee would be in a position to report this 
bill.

                 TITLE I--BUDGET WITH THE FORCE OF LAW

    Representative Cox developed and refined the concept of a 
joint budget resolution when he was senior associate counsel in 
the Executive Office of the President. His proposal was 
included in President Reagan's State of the Union Address in 
1988. As a House Member, Representative Cox first introduced a 
bill converting the concurrent resolution into a joint 
resolution in the 101st Congress (H.R. 5975). His bill provided 
for a joint resolution that retained the budget functions, 
required a two-thirds vote of each House to pass legislation 
that exceeded the resolution levels, and required the President 
to offset any breach of a function level by changing programs 
within the breached function. Representative Cox introduced 
similar bills in 1991, 1993, 1996, and 1997 (H.R. 298, H.R. 
2929, H.R. 4285, and H.R. 1372, respectively). In the 105th 
Congress, Representative Cox's bill, H.R. 1372, had 200 
cosponsors.
    Among the first bills that provided for a joint budget 
resolution, however, was one introduced in the 101st Congress 
by Senator Pete V. Domenici, the current Budget Committee 
chairman, Thomas A. Daschle, the Senate minority leader, and 
former Senator J. Bennett Johnston. The bill, S. 391, 
established a joint budget resolution under the jurisdiction of 
a joint budget committee. The resolution was to be enacted on a 
biennial basis. Like H.R. 853, the Senate bill replaced the 
budget functions with eight broad spending categories. S. 391 
also included an automatic joint resolution if the joint 
resolution was not agreed to by the beginning of the first 
session of each Congress.
    In addition to S. 391, other bills providing for a joint 
budget resolution in the 101st Congress were introduced by 
Representatives Andy Ireland (H.R. 191), Bill Schuette (H.R. 
1957), Elizabeth J. Patterson (H.R. 364), Fred Upton (H.R. 
2963), and Jim Lightfoot (H.R. 3068).
    In conjunction with consideration in the House of a 
proposed amendment to the U.S. Constitution requiring a 
balanced budget, Representative Panetta, then the chairman of 
the House Budget Committee, and Representative John Spratt 
introduced a bill in the 102d Congress in which the existing 
concurrent budget resolution would automatically spin off a 
bill establishing enforceable limits on spending and revenue, 
and deficit reduction targets (H.R. 5676). This bill was 
similar to a bill introduced on May 27, 1992, by Representative 
Panetta (H.R. 5272). Although the Committees on the Budget, 
Government Reform and Oversight, and Rules held hearings on 
this bill, the legislation was not considered on the floor.
    Other bills providing for a joint resolution were 
introduced by Representatives Spratt, Richard K. Armey, and Jim 
Kolbe in the 103d Congress (H.R. 998, H.R. 883, and H.R. 565, 
respectively), and by Representative Peter J. Visclosky in both 
the 104th Congress and the 105th Congress (H.R. 1516 and H.R. 
898, respectively).
    Chairman Kasich, then the ranking minority member of the 
House Budget Committee, was the first Member to actually offer 
an amendment on the House or Senate floor providing for a joint 
budget resolution. The amendment was offered as part of a 
complete substitute in the House to the Omnibus Budget 
Reconciliation Act of 1993 (H.R. 2264); it was defeated by a 
vote of 138 to 295 on May 25, 1993. On July 21, 1994, 
Representatives Kasich, Jim Kolbe, and J. Alex McMillan offered 
an amendment in the nature of a substitute to a budget process 
reform bill (H.R. 4604) offered by Representative Spratt. The 
Kasich amendment used a joint budget resolution to implement an 
annual entitlement review process (amendment No. 771). The 
amendment was defeated on a rollcall vote.
    The House has also considered and defeated a number of 
bills or amendments that established a joint budget resolution 
as part of the procedures to enforce various budgetary 
controls. These included Representative Bill Orton's amendment 
to H.R. 2491 in 1995, and a bill by Representatives Joe Barton 
and David Minge (H.R. 2003) in 1997.
    More recently, on November 13, 1995, Representative Cardin, 
the ranking minority member of the Budget Committee's Task 
Force on Budget Process Reform in the 105th Congress, proposed 
in H.R. 2622 converting the budget resolution into a joint 
resolution.

                 TITLE II--RESERVE FUND FOR EMERGENCIES

    The House recognized the need for special rules for 
emergencies when, in 1995, it passed an amendment to the U.S. 
Constitution to require a balanced budget. The House joint 
resolution, H.J.Res. 1, allowed an exception to the balanced 
budget requirement when ``three-fifths of the whole number of 
each House of Congress shall provide by law for a specific 
excess of outlays over receipts by a rollcall vote.'' The 
amendment also permitted Congress to waive the balanced budget 
requirement when a ``declaration of war is effect'' or ``the 
United States is engaged in military conflict which causes an 
imminent serious military threat to national security.'' The 
Senate did not approve the joint resolution by the necessary 
two-thirds vote.
    The way in which the Federal Government currently budgets 
for emergencies dates to the Budget Enforcement Act of 1990 
[BEA 90], which was part of the larger Omnibus Budget 
Reconciliation Act of 1990 [OBRA 90] (H.R. 5835, Public Law 
101-508). OBRA 90 imposed caps on discretionary spending and a 
pay-as-you-go [PAYGO] requirement for tax and spending 
legislation. The BEA provided that any appropriation or direct 
spending or tax provision that was designated by both Congress 
and the President as an emergency was exempt from the 
discretionary spending limits (if it were in an appropriation 
bill) or from PAYGO (if it were in an authorization bill).
    In January 1991, as part of its report on the Costs of 
Domestic and International Emergencies and Threats Posed by the 
Kuwaiti Oil Fires, the Bush administration submitted a 
definition of emergencies. This definition has been used in 
both the Bush and Clinton administration's to provide guidance 
to executive agency personnel submitting supplemental budgets. 
It is part of the Directives to Agencies Heads on the 
Preparation of the Administration's Budget Submissions 
(Circular No. A-11).
    The first legislative effort to change current budgetary 
treatment of emergencies dates to the 103d Congress. On August 
17, 1994, the House considered a bill permitting Members to 
offer amendments to strike nonemergency provisions from 
legislation that designated amounts for emergencies (H.R. 
4906). H.R. 4906 would have made it in order to offer 
amendments striking nonemergency-designated provisions from an 
emergency bill. The bill also required nonemergency items to be 
within the Appropriations Committee's allocations.
    During the consideration of H.R. 4906, the House considered 
three alternatives offered as amendments. The House defeated a 
substitute offered by Representative Sam Johnson that would 
have eliminated the exemptions for emergency-designated 
appropriations and reduced the discretionary spending limits by 
the amount of any emergency-designated appropriations enacted 
in any given fiscal year in the following fiscal year 
(amendment No. 846). Especially significant for this bill, the 
House also defeated an amendment by Representative Castle--
introduced separately as H.R. 4189--that would have established 
an emergency reserve for natural disasters and national 
security emergencies (amendment No. 847). The amendment 
established a separate allocation to the Appropriations 
Committee for emergencies, which was to be suballocated among 
each of the appropriations subcommittees. The amount included 
in the allocation was to be determined by the Congress rather 
than by formula. Finally, the amendment established a budget 
reserve account and prohibited the President from using amounts 
in the account for nonemergencies (amendment No. 847).
    The House ultimately adopted an amendment in the nature of 
a substitute offered by Representatives Stenholm, Penny, and 
Kasich. This amendment, which was also introduced by the three 
Members as part of an omnibus bill, H.R. 4434, and as a 
freestanding bill, H.R. 4913, also prohibited the inclusion of 
nonemergency items in emergency bills. In addition, it 
prohibited the Office of Management and Budget [OMB] from 
exempting any emergency-designated appropriation or direct 
spending or tax provision from the discretionary spending 
limits or PAYGO requirements if it included nonemergency 
spending or tax provisions. The bill was not taken up in the 
Senate.
    In 1994, the Report of the Bipartisan Task Force on 
Disasters recommended the establishment of a ``rainy day'' 
disaster trust fund. An amount equal to a 5-year rolling 
average was to be deposited in the trust fund for disaster 
preparedness and response efforts. The trust fund was to be 
financed by a fee on property and casualty insurance premiums. 
The House did not act on the Task Force's recommendations.
    During the same year, the House passed H.Con.Res. 218, the 
budget resolution for fiscal year 1995, which included the 
following (sec. 8, H.Rept. 103-428):

          It is the sense of Congress that----
          (1) The emergency designation under section 251 of 
        the Balanced Budget and Emergency Deficit Control Act 
        of 1985 has repeatedly been invoked to circumvent the 
        discretionary spending limits for other than emergency 
        purposes;
          (2) Amounts for emergencies should be set aside 
        within a reserve fund and subject to the discretionary 
        spending limit;
          (3) The reserve fund shall total 1 percent of annual 
        budget outlays; and
          (4) Emergency funding requirements in excess of 
        amounts held in the reserve fund should be offset by a 
        reduction in appropriations.

    This language was dropped in conference.
    In the budget resolution for fiscal year 1996, H.Con.Res. 
67, the House adopted a more inclusive sense-of-Congress 
provision (sec. 8, H.Rept. 104-120). The language read:

          It is the sense of Congress that Congress should 
        study alternative approaches to budgeting for 
        emergencies, including codifying the definition of an 
        emergency and establishing contingency funds to pay for 
        emergencies.

    This language was retained as a sense of the House in the 
conference report (sec. 314, H.Rept. 104-159). Similar language 
was also included in the House-passed budget resolution for 
fiscal year 1997, H.Con.Res. 178. This language was also 
retained in conference but became a sense of the House in the 
conference report.
    In 1995, Representative Bill Orton offered a complete 
substitute to an omnibus reconciliation bill (amendment No. 
884, H.R. 2491) that established a separate category in the 
budget resoltion for emergencies, and a budget reserve account. 
The Appropriations Committee was required to suballocate the 
amount for emergencies among its subcommittees. The amendment 
failed by a vote of 356 to 72.
    In 1997, the House voted on a bill establishing entitlement 
limits that also contained a reserve fund for emergencies. The 
bill, H.R. 2003, offered by Representatives Joe Barton and 
David Minge, would have withheld an amount for emergencies from 
the Appropriations Committee's 302(a) allocation. With most of 
the attention on the entitlement limits, the bill did not pass.
    Since Representative Castle offered his amendment to H.R. 
4906 in the 103d Congress, he has remained the leading advocate 
in the Congress of requiring the Federal Government to budget 
for emergencies--having introduced similar bills establishing 
reserve funds for emergencies in the 100th, 105th, and the 
106th Congresses (H.R. 1245, H.R. 457, and H.R. 537, 
respectively). As introduced in the 105th Congress, H.R. 537 
established a separate category for emergencies in the budget 
resolution, provided for a separate allocation to the 
Appropriations Committee for emergencies, and restricted the 
obligation of the emergency-designated appropriations to the 
designated emergencies.
    In March 1999, the Senate-passed concurrent budget 
resolution for fiscal year 2000 included a sense-of-Congress 
provision that called for a task force on establishing a 
reserve fund for natural disasters (sec. 350, Senate amendment 
to H.Con.Res. 68). The Senate resolution also included a 
definition of emergency similar to the definition in this bill 
and establishes a point of order in the Senate by which 
emergency-designations may be stricken from Senate bills. In 
conference, the reserve fund for natural disasters was dropped 
while the codified definition of an emergency and the point of 
order were retained (sec. 206, H.Rept. 106-91).

             TITLE III--ENFORCEMENT OF BUDGETARY DECISIONS

             Subtitle A--Application of Points of Order to
                         Unreported Legislation

    The congressional budget process is enforced by points of 
order that can be raised against legislation that is considered 
prior to the budget resolution, exceeds the budget resolution, 
or provides certain types of mandatory spending authority. In 
the House, these points of order may only be raised against 
bills that are first reported by the committee of jurisdiction. 
Consequently, bills that are brought to the floor without being 
reported by a committee are essentially exempt from all 
limitations imposed by the budget resolution.
    The absence of any enforcement for nonreported bills dates 
to the original Congressional Budget Act of 1974 (H.R. 7130, 
Public Law 93-344, 31 U.S.C. Subtitle II). The act exempted 
nonreported bills from the prohibition against consideration of 
measures that exceeded the budget aggregates under section 
311(a) of the Budget Act, but not the prohibition against 
consideration of spending and tax bills before the budget 
resolution is agreed to.
    In 1985, as part of the Balanced Budget and Emergency 
Deficit Control Act (H.J.Res. 372, Public Law 100-119, 2 U.S.C. 
Chapter 20), section 303(a) was restricted to reported bills 
and a new restriction against consideration of measures that 
exceeded a committee's allocation under 302(f) of the Budget 
Act was limited to reported bills.
    In 1992, House Budget Committee Chairman Panetta introduced 
an omnibus bill that extended Budget Act restrictions enforced 
through points of order to nonreported bills (sec. 201, H.R. 
5676). The Budget, Rules, and Government Oversight Committees 
held hearings on the bill, but it was not considered on the 
floor. Representative Penny introduced a similar bill in 1993.
    In 1993, the Committee on Rules reported a House resolution 
that modified the reconciliation bill that would have applied 
all requirements set forth in the Budget Act to nonreported 
bills (sec. 15203, H.R. 2264, as modified by H.Res. 186). This 
provision, together with other changes in the congressional 
budget process, was self-executed into a reconciliation bill, 
which the House approved, by a vote of 219 to 213. But under 
the threat of a point of order, this provision was dropped from 
the conference report.
    In 1995, Representative Orton offered a substitute to H.R. 
2491, an omnibus budget reconciliation bill, that would have 
extended all Budget Act points of order to nonreported bills 
(amendment No. 8, sec. 14901).
    Finally, on July 29, 1998, Representative John Joseph 
Moakley, the ranking minority member of the Rules Committee, 
introduced a bill applying points of order to nonreported bills 
(H.R. 4343).

             TITLE IV--ACCOUNTABILITY FOR FEDERAL SPENDING

        Subtitle A--Limitations on Direct Spending (Section 411)

Subtitle B--Enhanced Congressional Oversight Responsibilities (Section 
                                  421)

    The impetus for limiting the duration of any authorization 
initially came from the State of Colorado, which adopted a 
``sunset'' law in 1976. From 1982 through 1997, 36 States 
enacted sunset laws. Senator Joseph R. Biden, Jr., introduced 
the first sunsetting bill in Congress in 1975 (S. 2067). His 
legislation limited authorizations to a period of 4 years. 
Later in the same Congress, the Government Operations Committee 
reported a sunsetting bill introduced by Senator Muskie (S. 
2925). The bill automatically terminated Federal programs on a 
staggered basis unless they were reauthorized and reviewed by 
congressional committees according to a specified schedule. The 
bill was not ultimately considered on the Senate floor. In the 
House, hearings were held on the companion to the Senate bill, 
but it was not marked up in committee.
    More than 50 such bills were introduced in the 95th 
Congress. In the House, Representative Butler Derrick of the 
Rules Committee developed an alternative to sunsetting, which 
was dubbed ``sunrising.'' Rather than automatically terminating 
programs, Representative Derrick's alternative required the 
committees reporting authorizing legislation to include precise 
programmatic goals, the development of performance measures, 
and the periodic review of agency performance. The Senate 
Governmental Affairs Committee again reported a bill introduced 
by Senator Muskie (S. 2). The Committee on Rules and 
Administration subsequently reported the bill with amendments, 
in part derived from ``sunrising'' legislation, requiring 
committees to establish 10-year plans to review major programs 
and to require statements of program goals, performance 
measures and reporting requirements. Finally, after meeting 
additional concerns voiced by then-Senate Majority Leader 
Robert C. Byrd and then-Majority Whip Alan Cranston, the bill 
was considered on the Senate floor.
    In the 96th Congress, the Senate Governmental Affairs 
Committee again reported a sunsetting bill, but it was never 
considered on the Senate floor. In the House, the Rules 
Committee introduced a bill that required each committee to 
establish an oversight agenda, but dropped the automatic 
termination of programs that were not reauthorized according to 
schedule.
    More recently, Representative Mineta reintroduced bills 
requiring reauthorization and review of government programs in 
the 98th, 99th, and 100th Congresses (H.R. 2, H.R. 2, H.R. 7, 
respectively), and was joined by current House Minority Leader 
Gephardt in introducing such bills in the 101st, 102d, and 103d 
Congress (H.R. 23, H.R. 4062, and H.R. 10, respectively). 
During the 105th Congress, Representative Lloyd Doggett also 
introduced a version of this bill on June 17, 1997 (H.R. 1913).
    Two sunsetting-type bills have been introduced in the 106th 
Congress. Representatives Kevin Brady and John R. Kasich 
introduced H.R. 2128, a bill establishing a commission to 
review the efficiency of government programs, on June 10, 1999. 
In the Senate, on May 13, 1999, Senator Richard C. Shelby 
introduced S. 1040, a bill requiring reauthorization of 
government programs.
    Several minor provisions dealing with reauthorization and 
program evaluation did make their way into the House rules and 
the law. Clause 2 of House Rule X was amended in the 104th 
Congress to require, as part of the oversight reports 
committees are required to adopt each Congress, that:

          In developing such plans each committee shall, to the 
        maximum extent feasible * * * (C) have a view toward 
        ensuring that all significant law, programs, or 
        agencies within its jurisdiction are subject to review 
        at least once every 10 years.

    Further, section 703 of the original Congressional Budget 
Act required that the Budget Committee study and report on 
proposals ``establishing maximum and minimum time limitations 
for program authorizations.''

                Subtitle C--Strengthened Accountability

    The House first adopted a House rule providing for the 
automatic engrossment of a bill increasing the statutory limit 
on the debt in the 96th Congress (Public Law 96-78). The rule 
was further amended in the 96th, 97th, 98th, and 99th 
Congresses (it was recodified as rule XXIII in the 106th 
Congress). Since the beginning of the 104th Congress, the House 
has suspended the rule several times (H.Res. 149 in 1995, 
H.Res. 435 in 1996, H.Res. 152 in 1997, H.Res. 455 in 1998, and 
H.Res. 131 in 1999).
    In 1993, Representative Kasich proposed to repeal the so-
called Gephardt rule as part of an amendment in the nature of a 
substitute to the Omnibus Budget Reconciliation Act (amendment 
No. 83, sec. 14005(b)(3), H.R. 2264).
    Representative Nick Smith has introduced three resolutions 
suspending the rule, one each in the 104th, 105th, and 106th 
Congresses (H.Res. 138, H.Res. 30, and H.Res. 20, 
respectively).

    TITLE V--BUDGETING FOR UNFUNDED LIABILITIES AND OTHER LONG-TERM 
                              OBLIGATIONS

     Subtitle A--Budgetary Treatment of Federal Insurance Programs

    Interest in budgeting for contingent liabilities predates 
the congressional budget process. In August 1956, Congress 
enacted a bill that required agency accounts to be maintained 
on an accrual basis ``[a]s soon as practicable * * *'' (S. 
3897, Ch. 814-Public Law 863). The issue of unfunded 
liabilities and accrual budgeting was addressed in hearings of 
the Joint Committee on Budget Control in 1973.
    Currently, the Federal Government's contributions for 
military personnel and civilians under the Federal Employees 
Retirement System are made on an accrual basis. In 1990, direct 
loans and loan guarantees were put on an accrual basis as part 
of the Omnibus Budget Reconciliation Act of 1990 [OBRA 90] 
(H.R. 5835, Public Law 101-508, 2 U.S.C. Section 661 et seq.). 
For direct loans, the budget now shows the estimated expected 
losses after counting premiums, repayments, default, interest 
subsidies and other cash flows. For loan guarantees, the budget 
shows the estimated losses of the government over the life of 
the loan.
    President Bush's budget submission for fiscal year 1992 
proposed placing pension and deposit insurance on an accrual 
basis immediately and phasing in accrual budgeting for the 
other Federal insurance programs over a 2-year period. 
Representative Robert H. Michel introduced H.R. 4150 in the 
102d Congress at the request of the Bush administration. After 
it became apparent that the Bush administration intended to use 
a windfall from the conversion to finance several of its 
initiatives, the proposal was widely criticized and there was 
no legislative action on it.
    Pursuant to the Chief Financial Officer's Act of 1990, the 
General Accounting Office [GAO] and the Department of the 
Treasury audited prepared, consolidated financial statements 
that included accrual-type information. For instance, the 
statements showed the liabilities for Federal retirement 
benefits as the discounted costs of future benefits net of the 
Federal Government's contributions for covered employees 
(Public Law 101-576, 104 Stat. 2838).

           Subtitle B--Reports on Long-Term Budgetary Trends

    In January 1995, the Bipartisan Commission on Entitlement 
and Tax Reform released a final report to the President, which 
included in its recommendations a proposal to require the 
Congressional Budget Office [CBO] and the Office of Management 
and Budget [OMB] to periodically provide long-term projections 
of entitlement spending (Bipartisan Commission on Entitlement 
and Tax Reform Final Report to the President, January 1995, p. 
2). Later that year, Senator J. Robert Kerrey introduced S. 
823, a bill based on this recommendation. Senator Kerrey's bill 
would have required the committee report accompanying the 
budget resolution to include a discussion of the budget 
resolution's impact on revenue and entitlement spending over a 
30-year period. The bill also required the President's budget 
to include a similar projection as well as generational 
accounting information on the President's budget submission. No 
legislative action was taken on Senator Kerrey's bill.
    In 1998, the Senate adopted an amendment to the budget 
resolution for fiscal year 1999 (amendment No. 2237, S. Con. 
Res. 86)--offered by Senator Frank R. Lautenberg for Senator J. 
Robert Kerrey. The measure stated, as a sense of the Senate, 
that the budget resolution and the President's budget should 
include the following:

          An analysis for the period of 30 years beginning with 
        such fiscal year, of the estimated levels of total 
        budget outlays and total budget authority, the 
        estimated revenues to be received, the estimated 
        surplus or deficit, if any, for each major Federal 
        entitlement program for each fiscal year in such 
        period.

    The provision was not included in the conference report.

   TITLE VI--BASELINE, BYRD RULE, LOCK-BOX, AND AUTOMATIC CONTINUING 
                               RESOLUTION

                        Subtitle A--The Baseline

    According to Professor Timothy J. Muris of George Mason 
University School of Law, the concept of baseline budgeting was 
introduced into the budget process by former Senator and Senate 
Budget Committee Chairman Muskie during the Ford 
administration. The baseline assumed added importance with the 
enactment of fixed deficit targets in 1985, because it was used 
to calculate the amount of any programmatic reductions through 
the sequestration process. As part of OBRA 90, the law 
stipulated assumptions that underlie the construction of the 
baseline used to administer the PAYGO requirements (i.e. the 
so-called Gramm-Rudman baseline).
    In 1993, Representative Jim Ramstad introduced H.R. 323, a 
bill dealing with baselines. It would have required the 
President's budget submission to include comparisons of 
proposed expenditures and appropriations for the budget year 
with the prior fiscal year.
    The only instance in which there was a full debate on 
legislation limited to baseline-related issues was in 1994, 
when the House considered a bill on baselines offered by 
Representative Spratt (H.R. 4907). Representative Spratt's bill 
would have added a ``current funding baseline'' to accompany 
the existing--and what the bill called ``current policy''--
baseline. The current funding baseline assumed an adjustment 
for expiring housing contracts but no adjustments for 
inflation. The House, however, passed an amendment in the 
nature of a substitute offered by Representatives Penny, 
Stenholm, and Kasich. The amendment--which previously had been 
introduced by the same Members as H.R. 4914 and as part of H.R. 
4434--would have, among other things, repealed the automatic 
adjustment in the caps for changes in inflation and stipulated 
that the President's current services baseline assume 
adjustments for inflation.
    In 1995, the House defeated a substitute to H.R. 2491 
(amendment No. 8, title IV, chapter 2, secs. 14851-14854), the 
omnibus budget reconciliation bill. The substitute included a 
chapter on baselines nearly identical to H.R. 4914 which was 
introduced in the previous year (sponsored by Representatives 
Penny, Stenholm, and Kasich).
    Under the Balanced Budget Act of 1997, the baseline used to 
enforce PAYGO requirements was amended to permit Congress to 
specify in any legislation authorizing a program for a finite 
period whether the extension of the program should be included 
in the baseline (H.R. 2015, Public Law 105-33, 2 U.S.C. Section 
907).
    The House-passed budget resolution for fiscal year 1995 
included a sense-of-Congress provision on baselines that read 
as follows (sec. 10, H.Con.Res. 218, H.Rept. 103-428):

          It is the sense of the Congress that----
          (1) the President should submit a budget that 
        compares proposed spending levels for the budget year 
        with the current year; and
          (2) the starting point for deliberations on a budget 
        resolution should be the current year.

    This language was retained in conference (sec. 36, H.Rept. 
103-490). Similar language also was included in the House-
passed budget resolution for fiscal year 1996, H. Con.Res. 67 
(sec. 7, H.Rept. 104-120). This language, too, was retained in 
the conference report as a sense of the House (sec. 311, 
H.Rept. 104-159). Similar language was included in the House-
passed budget resolution for fiscal year 1997, H. Con.Res. 178, 
and was retained in the conference report (sec. 401, H.Rept. 
104-612). Finally, H. Con.Res. 84, the budget resolution for 
fiscal year 1998 (sec. 301, H.Rept. 105-100), also included a 
sense of the House on baselines, which was retained in 
conference (sec. 308, H.Rept. 105-116).
    In 1997, the House defeated a budget enforcement bill 
offered by Representatives Minge and Barton that, among other 
provisions, required OMB and CBO to submit baselines for a 10-
year period based on common economic assumptions (H.R. 2003).

                       Subtitle B--The Byrd Rule

    The Byrd rule was first applied to Senate-reported 
reconciliation bills as part of the Consolidated Omnibus Budget 
Reconciliation Act of 1985 on October 24 (H.R. 3128, Public Law 
99-272, 2 U.S.C. Section 644). In December of that same year, 
it was extended to conference reports as part of S. Res. 286. 
The rule was further modified by law and Senate resolution by 
S. Res. 509 in 1986, Public Law 99-509, also in 1986; Public 
Law 100-119 in 1987; and Public Law 101-508 in 1990.
    After witnessing provisions that would have saved more than 
$41 million struck under threat of the Byrd rule in 1994, then-
House Budget Committee Chairman Sabo, introduced a bill 
exempting conference reports from the Byrd rule (H.R. 4780). 
Subtitle B of title VI is virtually identical to the bill 
introduced by Representative Sabo.
    Also in 1994, 15 House Committee chairmen petitioned 
Speaker Tom Foley to urge the Senate majority leader to drop a 
provision making the Byrd rule permanent in a bill introduced 
pursuant to the recommendations of the Joint Committee on the 
Organization of Congress.

              Subtitle C--Spending Accountability Lock-Box

    Members have been attempting to dedicate the proceeds from 
floor amendments to deficit reduction for as long as there have 
been limits on appropriations. One approach has been to offer 
en bloc amendments that reduce an appropriation for a given 
program and then appropriate the same amount to an account 
created for gifts and bequests to the Federal Government.
    Two developments in the 103d Congress contributed to 
subsequent interest in the concept of a lock-box. To retain the 
support of conservative Democrats for the House-reported 
reconciliation bill in 1993, a deficit-reduction trust fund was 
included in the reconciliation bill with the purpose of 
ensuring that savings from the reconciliation bill were used 
for deficit reduction. Although this provision was dropped from 
the conference report, the President established the lock-box 
by Executive Order 12858. The following year, Representatives 
Robert E. Andrews and Bill Zeliff introduced a bill that would 
have reduced the discretionary spending limits by the amount of 
savings realized from amendments offered on a special 
legislative session dedicated to that purpose (H.R. 3266). They 
nearly obtained the sufficient number of sponsors needed to 
discharge the bill from the Government Operations and 
Appropriations Committees.
    The first attempt to establish a regular procedure to lock 
in savings from floor amendments for deficit reduction was 
reflected in H.R. 3145, introduced by Representative Michael D. 
Crapo. As originally introduced, this bill would have lowered 
the allocations and aggregates established in the budget 
resolution by the amount of any floor amendments reducing 
discretionary appropriations. Similar bills were introduced in 
the 103d Congress by Representatives Spratt (H.R. 5282) and 
Charles Schumer (H.R. 4057).
    Representatives Kasich, Stenholm, and Penny further 
developed the lock-box concept in the 103d Congress as part of 
an omnibus budget process bill (H.R. 4434, title II). As 
provided in H.R. 4434, the ability to reduce the allocations 
and caps by the amount that an amendment reduced an 
appropriations bill extended to committee markups as well as to 
floor consideration. Because that bill also provided for the 
expedited consideration of presidential rescissions, it 
permitted the President to designate some or all of the savings 
from a rescission to deficit reduction.
    The Line-Item Veto Act (S. 4, Public Law 104-130, 2 U.S.C. 
Section 691 et seq.) included a provision similar to that of 
H.R. 4434 in the 103d Congress that would have used both 
discretionary and mandatory savings from rescissions under the 
act for deficit reduction. In 1997, the Committee on Ways and 
Means reported a bill reinstating some of the tax provisions 
that were previously subjected to a line-item veto without 
including offsets for the reinstated provisions. This had the 
effect of superseding the lock-box. At the insistence of the 
House Budget and Rules Committee Chairmen, however, offsets 
were included in H.R. 2513, which passed the House on a voice 
vote. In 1998, the Supreme Court found the Line-Item Veto Act 
unconstitutional (Clinton v. City of New York, 524 U.S. 417 
(1998)) because it violated the presentment clause, Art. I, 
Sec. 7, cl. 2, of the Constitution.
    In response to repeated efforts to add the lock-box to an 
appropriations bill, the Committee on Rules reported out a 
simplified lock-box in 1995 (H.R. 1162). The House adopted this 
version of the lock-box as a freestanding bill by a vote of 364 
to 59. In that same year, the House defeated a substitute to a 
budget reconciliation bill, H.R. 2491, offered by 
Representative Bill Orton, which included a lock-box (amendment 
No. 884, sec. 14701). Additionally, the House passed lock-box 
amendments to three appropriation bills in the 104th and 105th 
Congresses: H.R. 2127 on August 4, 1995, H.R. 3019 on March 7, 
1996, and H.R. 2107 on July 15, 1997.
    Interest in the lock-box has been less intense in the 
Senate. But in the only instance in which an amendment 
providing for a lock-box was offered to a Senate bill (H.R. 
3019 on March 14, 1996), the amendment was killed by a point of 
order (with supporters of the amendment receiving only 36 of 
the necessary 60 votes to waive the point of order).
    For a more detailed information on the lock-box, see the 
report accompanying this bill and filed by the Committee on 
Rules.

              Subtitle D--Automatic Continuing Resolution

    Continuing resolutions are not new to the Federal 
Government. More often than not, one or more of the regular 
appropriations bills are not enacted by October 1--the first 
day of the fiscal year--and Congress passes a short-term 
continuing resolution [CR]. Between fiscal years 1952 and 1997, 
continuing resolutions were enacted for 42 out of the 46 fiscal 
years. During 17 of these years, none of the 13 regular 
appropriations bills had been enacted by the beginning of the 
fiscal year.
    In 1997 the Congress passed a supplemental appropriations 
bill that included a full-year automatic continuing resolution 
(H.R. 1469), which was added in the House by Representative 
Gekas. The CR, which was an amendment, was also introduced in 
the House as H.R. 638, a freestanding bill. The CR would have 
provided interim appropriations at 98 percent of the prior year 
for fiscal year 1998 only. The President vetoed the bill 
largely on the basis of the CR, noting in part:

          The bill contains a provision that would create an 
        automatic continuing resolution for all of fiscal year 
        1998. While the goal of ensuring that the government 
        does not shut down again is a worthy one, this 
        provision is ill-advised.

    Representative Gekas has been the leading advocate of 
establishing a regular automatic continuing resolution in the 
House. In the 104th Congress, he offered the bill, H.R. 4094, a 
6-year CR not to exceed 75 percent of the lowest of:

- The prior fiscal year.

- The lower of the House and Senate passed appropriations for 
    the current year.

- The levels proposed in the President's budget.

- The annualized level of interim appropriations for the budget 
    year.

    In the 105th Congress, Representative Gekas introduced H.R. 
1916, the equivalent to H.R. 4094 and H.R. 638, which provided 
funding at the prior year's levels and only effective for 
fiscal year 1997. Representative John E. Peterson also 
introduced a CR that provided funding at 90 percent of the 
prior fiscal year (H.R.. 987). Representative Thomas M. Davis 
similarly introduced a one-time CR for fiscal year 1997 at 100 
percent of the prior fiscal year (H.R. 1912).
    In the 106th Congress, the Senate Committee on Governmental 
Affairs has reported a bill, S. 558, that provides for an 
automatic continuing resolution for 2 fiscal years at the 
lowest of the prior year's level, the amount in the President's 
budget requests, or the annualized level for the current fiscal 
year.
    In January of this year, Representative Gekas introduced a 
bill providing for a continuing resolution for fiscal year 2000 
at 100 percent of the rate provided in the prior year (H.R. 
142). In the Senate, Senator Rod Grams introduced a similar 
bill to H.R. 142 (S. 104) and Senator John McCain introduced S. 
99, a bill providing for a continuing resolution for fiscal 
year 2000 at 98 percent of the prior year's rate.

              TITLE VII--BUDGETING IN AN ERA OF SURPLUSES

    As part of the Omnibus Budget Reconciliation Act of 1990, a 
pay-as-you-go [PAYGO] requirement was enacted for entitlement 
and tax legislation (H.R. 5835, sec. 13101, H.Rept. 101-964, 
Public Law 101-508, 2 U.S.C. 901 et seq.). Under PAYGO, the sum 
of all tax and entitlement legislation could not increase the 
deficit in any given fiscal year over a period of 5 fiscal 
years. In other words, if tax or spending legislation increased 
the deficit, it had to be offset by the subsequent enactment of 
legislation increasing taxes or decreasing entitlement 
spending. If no such offsets were enacted, then certain 
nonexempt entitlement programs were reduced on a pro rata 
basis. PAYGO was originally authorized through fiscal year 
1995.
    OBRA 90 authorized PAYGO only through fiscal year 1995 
because it was seen as a temporary measure to control the 
deficit. In another round of deficit reduction in 1993, the 
Omnibus Budget Reconciliation Act of 1993 extended PAYGO 
through fiscal year 1998 (H.R. 2264, sec. 14003, H.Rept. 103-
213, Public Law 103-66).
    PAYGO was further extended through fiscal year 2002 as part 
of the Balanced Budget Act of 1997 (H.R. 2015, sec. 10205, 
H.Rept. 105-217, Public Law 105-33). At the time, CBO was 
projecting an on-budget deficit through fiscal year 2002 ($88 
billion for fiscal year 2002). Immediately before the vote on 
the House version of this bill, there was a vote on a 
freestanding bill that would have augmented PAYGO with caps on 
entitlements and a discontinuation of some of the tax cuts 
expected to be in the final reconciliation bill. The House 
defeated this bill by a vote of 81 to 347.
    Over the next year, however, there was an unexpectedly 
large reduction in the deficit due to a surge in economic 
growth. Rumors emerged that OMB was prepared to argue that 
under existing law PAYGO would lapse if there was an on-budget 
surplus. OMB responded with an ambiguous letter that most 
interpreted as implying PAYGO would indeed lapse if there was 
an on-budget surplus by noting the following:

          [W]ithin the administration, we have looked at the 
        question of how the PAYGO provisions would apply in a 
        fiscal year with an on-budget surplus. Since the 
        definition of deficit used by the Balanced Budget and 
        Emergency Deficit Control Act of 1985 is the ``on-
        budget'' deficit, excluding the Social Security trust 
        funds and the Postal Service Fund, and since ``on-
        budget'' deficits are highly likely through the period 
        covered by the act, the PAYGO provisions will continue 
        to apply.

    Against the backdrop of these revised projections, 
Representatives David Minge, Gary A. Condit, Mark W. Neumann, 
Martin Frost, and John S. Tanner introduced H.R. 2568 in 
January 1997. This legislation would have effectively codified 
OMB's informal interpretation that PAYGO would not apply when 
there is an on-budget surplus. In years when there was an on-
budget deficit, H.R. 2568 would have extended PAYGO through 
fiscal year 2008. Representatives Minge, Davis, and Bill Luther 
reintroduced this bill as H.R. 196 on January 6, 1999. 
Representative Minge introduced another bill that would have 
also required extending PAYGO through fiscal year 1999, but 
would have required offsets for PAYGO legislation even when 
there was an on-budget surplus.
    Also introduced in the 105th Congress was the predecessor 
to this bill, H.R. 4837. Like H.R. 2568 in the 105th Congress 
(and H.R. 196 in the 106th Congress), it would have effectively 
allowed the on-budget surplus to be used to finance tax cuts or 
entitlement initiatives. Unlike these bills, however, it would 
have required additional offsets if the Congress and the 
President enacted a bill using the surplus to pay for tax or 
entitlement legislation and the surplus declines in subsequent 
projections.
    With both OMB and CBO estimating a huge surplus and the 
fiscal year 2000 budget resolution having assumed a significant 
tax cut that would be implicitly financed by the surplus, OMB 
has now reversed itself with its Director contending that they 
never interpreted the law as requiring PAYGO to lapse if there 
is an on-budget surplus. In his most recent letter to 
Representative Spratt, OMB Director Jacob J. Lew noted: ``We 
believe that PAYGO does apply when there is an on-budget 
surplus.''
    Senate Budget Committee Chairman Domenici introduced an 
omnibus budget process bill in 1999 that included a provision 
that would permit tax cuts and entitlement initiatives to be 
offset with the on-budget surplus (S. 93, title III). 
Separately as part of the conference report on the fiscal year 
2000 budget resolution, a Senate rule paralleling PAYGO was 
modified to explicitly permit the on-budget surplus to be used 
for tax cuts or entitlement initiatives (H.Con.Res. 68). This 
provision has not yet been reported in either the Senate 
Governmental Affairs or Budget Committees.
                           Committee Hearings

                              ----------                              


                  TASK FORCE HEARINGS--105TH CONGRESS

    For years, House Members complained that the congressional 
budget process was too complicated, too cumbersome, and too 
prone to creating conflict. On February 5, 1998, the Budget 
Committee created a Task Force on Budget Process Reform to 
address these issues. The Task Force was authorized pursuant to 
a colloquy between Representative John R. Kasich, chairman of 
the Budget Committee, and Representative David L. Hobson, then 
a Budget Committee member. Representative Jim Nussle was 
appointed as Task Force chairman, and Representative Benjamin 
L. Cardin as ranking minority member. The other members of the 
Task Force were Representatives George P. Radanovich, John E. 
Sununu, Kay Granger, David Minge, and Alan B. Mollohan. Mr. 
Nussle said the Task Force would hold hearings on the following 
areas:

- The nature of the budget resolution.

- Baselines and budgetary projections.

- Contingent liabilities.

- Emergencies.

- Budget enforcement.

    This legislation--the Comprehensive Budget Process Reform 
Act of 1999--is a product of the Task Force, working in 
conjunction with the Committee on Rules. The full Budget 
Committee held a hearing on the legislation on May 20, 1999, 
and reported the bill on June 17, 1999.
    The first task force hearing was held on March 31, 1998, on 
the topic of converting the budget resolution into a law. At 
this hearing, Dr. Roy Meyers, an assistant professor at the 
University of Maryland, and David Mason of the Heritage 
Foundation testified in favor of converting the concurrent 
budget resolution into a joint resolution, which--if signed by 
the President--would have the force of law. Dr. Allen Schick of 
the Brookings Institution cautioned, however, that adopting a 
joint resolution would reduce the ability of Congress to set 
forth its own distinct budget priorities.
    On April 1, the Task Force held a hearing on baselines and 
budgetary projections. The witnesses included Timothy J. Penny, 
a former Member of Congress and current co-chairman of the 
Committee for a Responsible Federal Budget; Paul N. Van de 
Water, Assistant Director for Budget Analysis, Congressional 
Budget Office [CBO]; and Timothy J. Muris, Foundation 
Professor, George Mason University School of Law. Former 
Representative Penny, who along with Chairman Kasich and 
Representative Charles W. Stenholm offered a bill in the 103d 
Congress to reform the concept of baseline budgeting, testified 
in favor of eliminating some elements of the baseline and 
modifying others. Mr. Muris testified in favor of eliminating 
the baseline altogether, arguing that it does not provide a 
true measure of the services being provided. In his testimony, 
Mr. Van de Water defined the concept and evolution of baselines 
and explained how CBO calculates its baseline.
    A third hearing was held April 23 on the budgetary 
treatment of insurance programs. At that hearing the witnesses 
included Susan J. Irving, Associate Director for Federal Budget 
Issues, General Accounting Office [GAO]; Marvin M. Phaup, 
Deputy Assistant Director, Special Studies Division, CBO; and 
Rudolph G. Penner, a former Director of CBO. All three 
witnesses testified in favor of changing the budgetary 
treatment of Federal insurance programs so that they more 
accurately reflect the true costs. The witnesses added, 
however, that the models for estimating risk are not 
sufficiently developed to immediately integrate accrual 
measures into the budget.
    On June 18, 1998, Task Force Chairman Nussle invited House 
Members to testify on their own ideas for reforming the budget 
process. Representatives Cox, Barton, Sabo, Stenholm, and 
Castle testified before the Task Force. In addition, 
Representatives Radanovich, Goss, Sam Johnson, and Livingston 
submitted prepared statements for the record.
    A fifth and final hearing, concerning emergencies, was held 
on June 23. The hearing featured James L. Witt, the Director of 
the Federal Emergency Management Agency [FEMA]. Director Witt 
was followed by a panel of experts on the budgetary treatment 
of emergencies: James L. Blum and Theresa A. Gullo of CBO, and 
Keith Bea of the Congressional Research Service [CRS].
    At the conclusion of these hearings, members of the Task 
Force worked on comprehensive legislation to reform the budget 
process. Along with Representative Goss of the Rules Committee, 
Representatives Nussle and Cardin introduced H.R. 4837 to the 
Congress on October 14, 1998.

                FULL COMMITTEE HEARINGS--106TH CONGRESS

    The bill was reintroduced in the 106th Congress as H.R. 
853. On May 20, 1999, the full House Budget Committee held a 
hearing on this legislation, the Comprehensive Budget Process 
Reform Act of 1999. Three panels of witnesses testified. During 
the first panel's testimony, Representative Nussle, the chief 
sponsor of the legislation, gave an overview of the major 
components of the bill and how it would affect the budget 
process. Representative Cardin, the main cosponsor of the bill, 
also testified; he stressed the bipartisan character of the 
bill, in part noting:

          There is nothing inherently Democratic or Republican, 
        liberal or conservative about supporting a budget 
        process that improves accountability and gives the 
        American people an accurate and clear picture of the 
        Federal budget. Six months of hearings on a wide range 
        of issues was followed by bipartisan consultations and 
        discussion.

    In discussing the PAYGO provision, Representative Cardin 
said it would allow the Congress to work its will without 
artificial procedural constraints. He further noted that both 
the President's budget and certain congressional proposals 
required a change in PAYGO to use projected on-budget surpluses 
to pay for tax cuts while protecting Social Security.
    In response to concerns that a joint resolution would slow 
the budget process, Representative Cardin argued that the 
Congress already wastes substantial amounts of time considering 
appropriations and reconciliation bills that are certain to be 
vetoed because they are based on a blueprint that the President 
has little role in shaping.
    Representative David Minge also testified in support of the 
bill during the first panel. He expressed particular support 
for the reserve fund for emergencies and the shift to accrual 
budgeting. He admitted to some concern with the PAYGO 
provision, but noted that the Blue Dog budget also included a 
change in PAYGO requirements. In support of Representative 
Cardin's description of the bipartisan nature of the bill, 
Representative Minge submitted a list of specific provisions 
that were inserted either to directly benefit Members of the 
minority or at the request of such Members (Serial No. 106-4, 
p. 21).
    Following the Members' testimony, Jacob J. Lew, Director of 
the Office of Management and Budget [OMB], presented the 
administration's view. He testified in opposition to the bill, 
and in response to a question by Representative Spratt, said he 
would recommend the President veto the bill. Director Lew 
appeared to repudiate his predecessor's support for a joint 
budget resolution. He opposed the codification of a definition 
for emergencies even though the administration has a similar 
definition in its directives to agency heads on budget 
preparation, the automatic continuing resolution, the 
appropriations lock-box, and the 10-year limitation on 
authorizations. Mr. Lew's strongest objections, however, 
focused on the PAYGO title. He also denied that the President's 
budget required a change in PAYGO or that OMB had previously 
implied that PAYGO would not apply when there is an on-budget 
surplus.
    The third panel began with a statement by Carol Cox Wait, 
President of the Committee for a Responsible Federal Budget. 
She testified strongly in favor of converting the concurrent 
resolution into a joint resolution. She also supported the 
reserve fund for emergencies, the automatic continuing 
resolution, the 10-year limitation on authorizations, and 
accrual budgeting for Federal insurance programs.
    CBO Director Dan L. Crippen discussed how the budget 
resolution and automatic continuing resolution would change the 
budget process. Regarding emergencies, Dr. Crippen said: 
``[T]he codification of an accepted definition of emergency 
would clearly be an improvement over the current `anything 
goes' situation.'' Dr. Crippen also said the requirement that 
Congress reauthorize all programs over a 10-year period could 
support the goals underlying the Government Performance and 
Results Act of 1993 (Public Law 103-62).
    Dr. Rudolph G. Penner, a senior fellow at the Urban 
Institute and a former Director of CBO, generally supported the 
bill, particularly the joint resolution and the insurance 
provisions. He suggested a number of changes intended to 
improve the incentives in the bill, including reducing the 
level of the automatic continuing resolution below that of the 
prior year and holding PAYGO harmless for changes in the 
surplus due to economic factors.
    Robert Greenstein, Executive Director of the Center on 
Budget and Policy Priorities, opposed most elements of the bill 
other than the subtitle on accrual budgeting. He argued that 
the joint resolution would delay the appropriations process, 
and that discretionary programs would be ``squeezed'' by the 
lock-box. Regarding PAYGO, he supported the concept of allowing 
some of the surplus to be used as an offset for future 
legislation, but disagreed over the appropriate amount. He also 
warned that the PAYGO changes could trigger a sequester even 
though he conceded that Congress would not actually allow a 
sequester to occur.
    Representative Goss, chairman of the Rules Committee's 
Subcommittee on Legislative and Budget Process, submitted a 
written statement for the hearing in which he disputed the 
contention that the budget process wasn't broken and focused on 
procedural elements of the bill that bring more accountability 
into the budget process. These provisions included requiring 
committees to justify any measure that exceeds the budget 
resolution; requiring programs to be reauthorized every 10 
years; repealing a House rule that enables the House to send a 
bill raising the debt limit to the Senate without having to 
vote on it; and applying points of order to nonreported bills.

              HEARINGS OF OTHER COMMITTEES--106TH CONGRESS

    The House Rules Committee held 2 days of hearings on H.R. 
853 during the 106th Congress. On May 12, the committee 
received testimony from three of the bill's sponsors, 
Representatives Nussle, Cardin, and Minge; the General 
Accounting Office; the Concord Coalition; and the Center on 
Budget and Policy Priorities. On May 13, the committee heard 
testimony from House Members with a continuing interest in 
budget process reform.
    In the Senate, the Budget and Government Affairs Committees 
held a joint hearing on budget process reform on January 27, 
1999. Representatives Nussle and Cardin testified on the 
subject of H.R. 4837 (the predecessor, in the 105th Congress, 
to H.R. 853) in light of some of the common elements in that 
bill and a bill introduced by Senate Budget Committee Chairman 
Pete Domenici, S. 93. In addition to biennial budgeting, which 
was not included in H.R. 4837, Senator Domenici's bill provided 
for an automatic continuing resolution, codified a definition 
of an emergency, and relaxed PAYGO requirements when there is 
an on-budget surplus.
                    Summary of Committee Amendments

                              ----------                              


                AMENDMENT IN THE NATURE OF A SUBSTITUTE

    During the Budget Committee's markup of H.R. 853 on June 
17, Representative Nussle offered an amendment in the nature of 
a substitute, which is the base text of the legislation 
reported by the committee. The amendment made numerous 
technical and conforming changes to the legislation as 
introduced. It also made the following substantive changes:

- In title I, the amendment changes the underlying bill's 
    amendment of the Congressional Budget Act by highlighting 
    the specific changes being made, rather than restating 
    large sections of current law. It also adds interest as a 
    discrete category to the list of spending categories 
    provided for in the budget resolution. It drops a 
    definition of a presidential veto for congressional 
    purposes because of parliamentarian concerns about current 
    House and Senate precedents relating to presidential 
    vetoes. It also changes a 3-day limit to a 5-day limit in 
    two places providing for an automatic discharge of 
    legislation considered by the Budget Committee: in 
    considering the fall-back concurrent resolution should the 
    original joint resolution on the budget be vetoed; and in 
    considering an emergency exception of spending above the 
    reserve levels.

- In title II, the amendment in the nature of a substitute 
    consolidates the two distinct emergency reserves, for 
    direct spending and for discretionary spending, into a 
    single reserve fund. The reserve fund may be used to adjust 
    both the allocation of discretionary spending for the 
    Appropriations Committee and the allocations of direct 
    spending for the authorization committees. The amendment 
    also requires the President to justify any supplemental or 
    amended budget requests for emergencies on the basis of the 
    definition of emergencies set forth in the bill. Finally 
    the amendment makes various changes in the formula for 
    calculating the amount of outlays to be held in reserve for 
    emergencies.

- There are no significant changes in titles III or V.

- In title IV, the amendment clarifies that the prohibition 
    under section 411(a) of the bill against the consideration 
    of any measure authorizing discretionary appropriations for 
    a program that is authorized for a period in excess of 10 
    years applies only to ``new'' programs.

- In title VI, the amendment excludes one-time spending items 
    from the calculation of the continuing resolution spending 
    levels, such as those designated as emergencies under 
    existing law.

- In title VII, the amendment modifies the method by which the 
    on-budget surplus is calculated by changing the assumptions 
    used to project discretionary spending levels.

                      AMENDMENT TO THE SUBSTITUTE

    The committee adopted a second-degree perfecting amendment 
offered by Mr. Bentsen. It amends section 206 of the bill to 
require the full committee to determine and certify whether 
specific provisions in reported bills and joint resolutions are 
for legitimate emergencies as defined in this bill and 
interpreted according to the guidelines developed pursuant to 
the bill and hence eligible for an adjustment in the 
appropriate committee's 302(a) allocations. In the introduced 
bill, the authority to make this determination was delegated to 
the Budget Committee chairman.
                     Section-By-Section Description

                              ----------                              


                      PURPOSES, TABLE OF CONTENTS,
                          AND EFFECTIVE DATES

                               SECTION 1

    Subsection (a) cites the bill as the ``Comprehensive Budget 
Process Reform Act of 1999.''
    Subsection (b) sets forth the table of contents for the 
act.

                               SECTION 2

    Section 2 sets forth seven purposes of the act, each 
corresponding to the seven purposes of the bill:

- Give the budget the force of law.

- Budget for emergencies.

- Strengthen enforcement of budgetary decision.

- Increase accountability for Federal spending.

- Display the unfunded liabilities of Federal insurance 
    programs.

- Mitigate the bias in the budget process toward higher 
    spending.

- Modify requirements when there is an on-budget surplus.

                               SECTION 3

    Section 3 makes all sections of the bill effective on 
enactment but specifies that it will first apply to fiscal year 
2001. Exceptions are provided for title II--which is not 
effective until sections 251 and 252 of the Deficit Control Act 
are amended in subsequent legislation--and Subtitle A of title 
V, which is phased in over a 6-year period.

                               SECTION 4

    Section 4 changes the purposes of the Congressional Budget 
Act of 1974 set forth in section 2 of the act to emphasize the 
enhanced role of the President in the budget process. The first 
two paragraphs of section 2 are changed from assuring 
``effective congressional control over the budget process'' and 
providing for the ``congressional determination each year of 
the appropriate level of Federal revenues and expenditures'' to 
assuring ``effective control over the budgetary process'' and 
facilitating the ``determination each year of the appropriate 
level of Federal revenues and expenditures by the Congress and 
the President.''

                   TITLE I--BUDGET WITH FORCE OF LAW

                              SECTION 101

    Section 101 states that the purposes of this title are to 
focus the initial deliberation of the budget process on 
aggregate levels of Federal spending and taxation, encourage 
cooperation between the President and Congress in developing 
budgetary priorities, and reach budgetary decisions early in 
the budget cycle.

                              SECTION 102

    Section 102 restates the timetable for the congressional 
budget process set forth in section 300 of the Budget Act. The 
only material change in the timetable is the elimination of the 
date at which the Committee on Appropriations can report a bill 
in the absence of a budget resolution without violating section 
303(a) of the Budget Act (see section 104).
    No changes are made in the deadline for submission of the 
President's budget or the completion of congressional action on 
the budget resolution, appropriation bills, or any 
reconciliation bill. Under this timetable the Congress is still 
expected to complete action on the budget resolution by April 
15--a deadline it has failed to meet in the past. With the 
budget resolution now being sent to the President, the 
committee believes that it is imperative that the Congress 
redouble its efforts to reach an agreement early in the budget 
cycle. If Congress adheres to this schedule, there should be 
ample time for Congress to respond to a vetoed resolution--
through an override attempt or by passing a concurrent 
resolution--before the House Appropriations Committee is 
scheduled to begin to report appropriation bills (the last of 
which is to be reported in the House by June 10).

                              SECTION 103

    Subsection (a) amends 301(a) of the Budget Act to convert 
the existing concurrent resolution on the budget into a joint 
resolution on the budget. Subsection (a) simplifies the content 
of the budget resolution by replacing the 20 budget functional 
categories of spending with the following broad categories of 
Federal spending: total discretionary, with subtotals for 
defense, nondefense, and emergencies; and total direct 
spending. The committee notes that the aggregates are not 
automatically subject to sequestration and in no way revise or 
supersede the levels of the discretionary spending limits set 
forth in section 251 of the Balanced Budget and Emergency 
Deficit Control Act, (including those for highways and mass 
transit). Separate legislation, whether as part of a 
reconciliation bill or other freestanding bill, would need to 
be enacted in order to enforce these levels with sequestration.
    As amended by subsection (a), section 301(a) of the Budget 
Act would still retain in the budget resolution aggregate 
levels for spending, revenue, surpluses or deficits, interest, 
public debt, as well as the assumed change in revenue. For the 
Senate, totals are retained for Social Security (outlays and 
revenue) to enforce points of order.
    Subsection (b) amends section 301(b) of the Budget Act to 
revise the list of optional items in the budget resolution. It 
eliminates the reconciliation directives, which will be 
included in the report accompanying the budget resolution; the 
levels of direct loan obligations and primary loan guarantees 
commitments, which are obsolete under the Credit Reform Act of 
1990; and the display of retirement trust fund balances.
    Subsection (b) also permits the budget resolution to 
include legislation increasing the debt limit in the budget 
resolution. The committee believes it is appropriate for the 
budget resolution to increase the debt limit because the amount 
the Federal Government borrows is largely a function of the 
spending and revenue levels set forth in the budget resolution. 
Any increase in the debt limit, however, may only be 
incorporated in the budget resolution if the Committee on Ways 
and Means submits it for this purpose. This provision has no 
effect on the Committee on Ways and Means' jurisdiction over 
the debt limit and does not imply that the Senate can originate 
a bill changing the debt limit.
    Finally, subsection (b) retains, as optional elements of 
the budget resolution, provisions relating to delayed 
enrollment, the debt increase as a measure of the deficit, and 
Senate reserve funds. It also narrows the scope of the so-
called elastic clause to limit it to congressional procedures 
relating to the budget, such as reserve funds that provide for 
automatic adjustments in the allocations and aggregates for 
specified legislation.
    As amended by the bill, the Rules Committee would continue 
to receive referrals of any budget resolution that changes 
House rules and procedures and committees would still be 
required to submit to the Budget Committee their views and 
estimates on the President's budget.
    Subsection (c) changes the required elements of the report 
under section 301(e)(2) of the Budget Act. It requires the 
report to include the function-level display that was 
previously included in the legislative text of the budget 
resolution. It also requires the report to include the 
following budget totals as a percentage of GDP: revenues, 
surplus or deficit, total spending, defense discretionary 
spending, nondefense discretionary spending, and direct 
spending. Finally, it requires the Budget Committee to justify 
an allocation of new budget authority that is not subject to 
annual appropriations.
    Subsection (c) also retains such existing mandatory 
elements of the budget resolution such as the 302(a) 
allocations, various comparisons between the budget resolution 
and the President's budget submission, and underlying economic 
assumptions.
    Subsection (d) makes several changes in the optional 
elements in the report accompanying the budget resolution. Most 
important, it permits the inclusion of the reconciliation 
instructions that were previously included in the legislative 
text of the budget resolution. These instructions are moved to 
the report to preserve congressional prerogatives to decide 
which committees are reconciled for assumed spending and 
revenue initiatives.
    Subsection (e) generally requires the President's budget 
submission to include the same totals, other than any proposed 
revenue change, as is required for the joint budget resolution 
under subsection (a).
    Subsection (f) amends section 305 of the Budget Act to 
strictly limit the elements of the budget resolution to those 
items set forth in subsection (a). Any budget resolution 
containing any other matter would be subject to point of order 
and not be privileged as a budget resolution in the House or 
Senate. Moreover, the bill would not be accorded the protection 
from amendments and filibuster that is provided to 
reconciliation measures in the Senate. The intent of this 
subsection is to preclude extraneous measures from being 
appended to the budget resolution.

                              SECTION 104

    Subsection (a) repeals Section 302(a)(5) of the Budget Act 
that requires the Budget Committee chairman to provide an 
allocation to the Appropriations Committee should the budget 
resolution not be adopted by April 15.
    Subsection (b)(2) repeals a similar exception under section 
302(g) and thus strengthens the prohibition against considering 
tax or spending bills before Congress has agreed to a budget 
resolution.
    Subsection (b)(3) increases the threshold in the Senate for 
waiving both the requirement that the budget resolution be in 
place prior to considering tax and spending bills and that non 
germane amendments not be entertained from a simple majority to 
three-fifths (both for waiving the point of order and appealing 
the ruling of the Chair). The committee believes this will 
increase pressure on the Congress to pass a budget resolution 
and avoid the kind of stalemate that occurred in the second 
session of the 105th Congress.
    Subsection (c)(1) adds a new section 316 to the 
Congressional Budget Act.

- Section 316(a) of the Budget Act as amended establishes 
    expedited procedures for considering a concurrent budget 
    resolution if the Congress and President are unable to 
    agree to a joint budget resolution. In the event the joint 
    budget resolution is vetoed and the veto is not overridden, 
    the Congress may consider a concurrent budget resolution 
    under expedited procedures. The Budget Committee has 5 days 
    after the joint resolution is vetoed to act on a concurrent 
    resolution at the same, or revised, levels. If the budget 
    resolution is not reported within 5 legislative days, then 
    the committee is discharged and the bill is placed on the 
    appropriate calendar.

- Section 316(b) of the Budget Act as amended applies the same 
    procedures for considering a concurrent resolution as apply 
    to consideration of the joint resolution. The bill does not 
    provide expedited floor procedures for the House because 
    such procedures can be constructed by the House resolution 
    providing the consideration of the bill.

- Section 316(c) and (d) of the Budget Act as amended also 
    provides that a fallback concurrent budget resolution would 
    be treated as a joint resolution for most congressional 
    purposes: the levels established by the concurrent budget 
    resolution would be enforceable through points of order 
    under the Budget Act; the allocations would provide binding 
    limits on the amount of new budget authority available to 
    the Appropriations and authorizing committees; and any 
    reconciliation targets would be binding on the authorizing 
    committees and that the resulting reconciliation bill would 
    be not be subject to filibuster or unlimited amendments in 
    the Senate.

    Subsection 104(c)(2) amends the table of contents to 
reflect the fallback concurrent budget resolution.

                              SECTION 105

    Subsection (a) conforms various sections of the Budget Act 
to facilitate the conversion of the concurrent budget 
resolution to a joint resolution.
    Subsection (b) makes the necessary conforming changes in 
the Rules of the House to accommodate a joint budget 
resolution.
    Subsection (c) modifies the special reconciliation process 
for considering a reconciliation bill in order to prevent a 
PAYGO sequester under section 258C of the Balanced Budget and 
Emergency Deficit Control Act of 1985, so that it is triggered 
by a joint rather than a concurrent budget resolution.
    Subsection (d) modifies the reconciliation procedures under 
section 310 of the Budget Act so that they are triggered by the 
reconciliation instructions in the joint statement of managers 
accompanying the conference report on the joint budget 
resolution rather than in the actual conference report as under 
current law.
    Subsection (e) takes the definition of ``direct spending'' 
set forth in section 250(c)(8) of the Deficit Control Act and 
defines it in section 3(11) of the Budget Act for purposes of 
the 10-year authorization requirements set forth in section 411 
and 421 of the bill.
    Subsection (f) amends section 314(d) of the Budget Act to 
require the Appropriations Committee to adjust its 302(b) 
allocations if the Budget Committee adjusts its 302(b) 
allocation. Subsection (f) also deems the adjustments in the 
302(b) allocations to be automatic so that Members can offer 
amendments to such provisions without points of order being 
raised because the Appropriations Committee has not made the 
required adjustments.

                TITLE II--RESERVE FUNDS FOR EMERGENCIES

                              SECTION 201

    Section 201 states that the purposes of title II are to 
develop budgetary and fiscal procedures for emergencies, 
subject spending for emergencies to budgetary procedures and 
fiscal controls, and establish criteria for determining 
compliance with emergency requirements.

                              SECTION 202

    Section 202 repeals the existing procedures for 
automatically increasing the aggregates and allocations in the 
budget resolution and accompanying report and the discretionary 
spending limits under the Deficit Control Act, as well as 
exempting from PAYGO requirements, legislation that designates 
an amount or provision as an emergency.
    Subsection (a) repeals the automatic adjustment in the 
discretionary spending limits for amounts designated for 
emergencies pursuant to section 251(b)(2) of the Deficit 
Control Act.
    Subsection (b) similarly repeals the exemption from PAYGO 
requirements for direct spending provisions that are designated 
as emergencies under section 252(e) of the Deficit Control Act.
    Subsection (c) repeals clause (2) of House rule XXI, which 
prohibits the consideration of reported bills that commingle 
emergency and nonemergency appropriations. The committee 
believes this restriction is unnecessary if emergencies are 
being budgeted for in advance, pursuant to the procedures set 
forth in title II of the bill. Presumably the Appropriations 
Committee will be more inclined to provide for emergencies in 
regular appropriation bills if such amounts are no longer 
effectively exempt from the 302(a) allocations and 
discretionary spending limits.
    Subsection (d) repeals the automatic adjustment in the 
budget resolution's aggregates and 302(a) allocations for 
amounts or provisions designated for an emergency under section 
314 of the Budget Act.

                              SECTION 203

    Section 203 defines ``emergency'' in Section 3 of the 
Budget Act for purposes of the emergency procedures and reserve 
fund set forth in this title. The definition is adapted from an 
OMB report titled ``Report on the Costs of Domestic and 
International Emergencies'' and on the ``Threats Posed by the 
Kuwaiti Oil Fires.'' Borrowing from proposed amendments to the 
U.S. Constitution to require a balanced budget, the definition 
was modified to include military conflicts. Under the modified 
definition, for an appropriations item to qualify for an 
adjustment in the budget resolution allocations, the situation 
for which the appropriation is provided must be severe, 
unanticipated, and require additional funding. An emergency is 
specifically defined as an unanticipated emergency with the 
term ``emergency'' defined as:

        a situation that requires new budget authority and 
        outlays (or new budget authority and outlays flowing 
        therefrom) for the prevention or mitigation of, or 
        response to, loss of life or property, or a threat to 
        national security.

    The section further defines ``unanticipated'' as an 
underlying situation that is:

- sudden, which means quickly coming into being or not building 
    up over time.

- urgent, which means pressing, compelling, or requiring 
    immediate action.

- unforeseen, which means not predicted or anticipated as an 
    emerging need.

- temporary, which means not of permanent duration.

    This definition will provide the basis for developing 
objective criteria for determining whether an emergency exists 
for purposes of adjusting the aggregates and allocations in the 
budget resolution. The purpose of this definition is to provide 
a basis for establishing clear guidelines to determine whether 
an appropriated item is a legitimate emergency. At the same 
time the definition should provide sufficient flexibility to 
respond to the full range of natural disasters and threats to 
national security, as well as a financial crisis along the 
lines of the savings and loan crisis of the late 1980's.
    The committee intends for the definition to cover a full 
range of emergencies, including natural disasters, other 
domestic emergencies, economic crises, and military conflicts.

                              SECTION 204

    Because the definition is necessarily broad to accommodate 
a wide range of situations that are inherently unpredictable, 
section 204 directs the House and Senate Budget Committee 
chairmen to develop guidelines to be used in order to apply the 
definition to specific situations. For example, the guidelines 
might provide that in order to qualify as ``unforeseen'' the 
funding request must not have been public knowledge when an 
appropriations measure was passed for the relevant fiscal year. 
The Budget Committee chairmen are directed to consult with the 
chairmen of the Appropriations Committees, the authorizing 
committees and OMB.
    These guidelines must be printed in the Congressional 
Record within 5 months. In developing these guidelines, the 
committee may consider such factors as the estimated spendout 
rate for the budget authority provided by the measures in 
question with the assumption that most emergency assistance 
will be consumed within a relatively short timespan.

                              SECTION 205

    Section 205 amends the budget submission requirements in 
section 1105 of the title 31, United States Code, by requiring 
the President to include in his budget submission an amount for 
emergencies. As described in subsection 206, the amount must be 
at least equal to the historical average of amounts provided 
for emergencies and must be included under, or subject to, the 
discretionary spending limits or PAYGO requirements. The 
President is also required to justify in any budget submission 
or request that the purpose for the spending fits within 
definition of an emergency. The committee anticipates that this 
requirement will be reflected in the administration's 
directives to the agencies on the preparation of amended and 
supplemental budget requests.

                              SECTION 206

    Subsection (a) adds a new Section 317 to the Congressional 
Budget Act.

- Section 317(a) of the Budget Act, as amended, sets forth the 
    procedures for adjusting the allocations for committees 
    that report bills providing amounts for emergencies. After 
    a bill is reported that provides an amount for emergencies, 
    the Budget Committee is required to determine and certify 
    any provision or amount of a reported bill that is for an 
    emergency as defined in this act and interpreted according 
    to the guidelines issued pursuant the act. The Budget 
    Committee chairmen are required to adjust the appropriate 
    302(a) allocation by this amount. Although it is 
    anticipated that the adjustments would be for the 
    Appropriations Committee, the adjustment could be made to 
    an authorizing committee for legislation providing 
    mandatory spending authority. No adjustments are made in 
    the aggregate levels because they already assume the 
    amounts held in reserve for emergencies.

- Section 317(b)(1) of the Budget Act as amended sets forth the 
    formula for determining the amount included in the reserve 
    fund. This amount in the reserve fund, which is initially 
    withheld from the allocations, is equal to the average of 
    the:

        enacted levels of budget authority for emergencies in 
        the 5 fiscal years preceding the current year; and

        the average of new outlays for emergencies in those 5 
        preceding years that flow from the budget authority 
        provided above but only for the first year in which it 
        is available for obligation.

- Section 317(b)(2) of the Budget Act, as amended, clarifies 
    how the reserve fund amount will be computed for any fiscal 
    year in which the preceding 5 years includes one or more of 
    fiscal years 1994 through 1998. It also specifies that 
    within 6 months after the enactment of this act and every 
    February thereafter, CBO will transmit a report to assist 
    the Budget Committees to determine what amounts should be 
    included for purposes of calculating the average. The CBO 
    Director is required to calculate the 5-year rolling 
    average. The committee expects CBO to use the following 
    formula when calculating the average for such a fiscal 
    year.

          1. The amount appropriated with an emergency 
        designation for emergencies for those years (less any 
        amounts for emergency designations that do not meet the 
        definition as set forth in section 203).

          2. New outlays flowing from (1).

          3. The amount appropriated for emergencies without an 
        emergency designation (including firefighting).

          4. Outlays flowing from (3).

          5. Outlays flowing from amounts appropriated for 
        items corresponding to (1) but which were appropriated 
        before the Budget Enforcement Act of 1990 instituted 
        the emergency designation process.

          According to a preliminary estimate by committee 
        staff, the historical average for fiscal years 1995 
        through 2000 is $8.9 billion in budget authority and 
        $5.8 billion in outlays.

- Section 317(c) of the Budget Act, as amended, also 
    establishes the procedures for adjusting the allocations 
    for bills that are within the emergency reserve. If the 
    bill is reported by the Appropriations Committee, the 
    chairman may make the adjustment only for the budget year 
    (the only year for which an allocation is made for 
    discretionary spending). If the bill is reported by an 
    authorizing committee, then the adjustment is made for the 
    budget year and the total of the first 5 fiscal years.

    Section 317(c) of the Budget Act, as amended, also 
    establishes special procedures for holding the 
    discretionary limits harmless for dire emergencies once the 
    reserve fund is exhausted. The committee recognizes that 
    there may be years that exceed the average for the 
    emergencies contemplated in this title or for extraordinary 
    circumstances when a natural disaster, financial crisis, or 
    international incident would require appropriations in 
    excess of the reserve. In such cases, the bill providing 
    the necessary funds would be referred to the Budget 
    Committee. The Budget Committee would have 5 days to decide 
    to offer an amendment exempting some or the entire amount 
    identified for emergencies from the budget resolution and 
    any statutory controls over the budget. The Budget 
    Committee is prohibited from making any other substantive 
    changes in the bill.

          If a bill is reported by the Budget Committee with an 
        exemption for an amount in excess of the reserve fund, 
        then such amounts are not counted for purposes of 
        determining whether the bill or joint resolution 
        breaches the budget resolution's aggregates or the 
        appropriate committee's 302(a) allocation.

- Section 317(d) of the Budget Act as amended requires the 
    Appropriations Committee, or relevant authorization 
    committee, to identify any amounts provided for an 
    emergency in the accompanying report since the committee 
    would no longer designate the appropriations item as 
    emergencies in the legislative text. It is largely on the 
    basis of the information provided as part of this 
    notification that the Budget Committee will evaluate 
    whether appropriated items meet the definition set forth in 
    section 203.

    In the event a measure is considered that is under the 
amount in the reserve for budget authority but not outlays, the 
full committee will first determine the amount of the average 
in budget authority that will be exempt from all applicable 
limits. The chairman will then make the corresponding 
adjustment in outlays. The reverse would also be true if a bill 
was over in budget authority and under in outlays.

                              SECTION 207

    Section 207 amends section 306 of the Budget Act, which 
prohibits the consideration of any measure within the Budget 
Committee's jurisdiction not reported from the committee. The 
section prohibits amendments from changing the amount exempted 
from the discretionary spending limits or PAYGO requirements. 
Such amendments might conceivably increase or decrease the 
amount designated as an emergency. These amendments are 
prohibited to ensure that the exemption is made on an objective 
basis and not subject to the political pressures that would 
otherwise be exerted in the amendment process.

                              SECTION 208

    Section 208 amends section 308(b)(2) of the Budget Act to 
require the Budget Committee to include in its monthly 
scorekeeping reports, the balance remaining in the emergency 
reserve fund.

                              SECTION 209

    Section 209 amends section 305 of the Budget Act to 
prohibit the consideration of any amendment to a joint 
resolution that would reduce the amount in the emergency 
reserve fund below the historical average as estimated by the 
Congressional Budget Office. This prohibition is enforced by a 
point of order that can be waived by a simple majority in the 
House and a three-fifths supermajority in the Senate. The 
purpose of this requirement is to ensure that the amount in the 
reserve fund is determined by objective, formulaic factors and 
not used as a means to reduce the overall level of 
discretionary spending.

                              SECTION 210

    Because the Congress is well into the budget cycle for 
fiscal year 2000, section 210 makes title II first effective 
for fiscal year 2001. Moreover, this title is not effective 
until legislation has been enacted to modify the discretionary 
spending limits and PAYGO requirements. The committee notes 
that because the discretionary spending limits were set at 
levels that assume a certain amount of spending above these 
limits for emergencies, several members have indicated it may 
be appropriate to adjust the limits some or all of the amount 
of emergency spending that would now be subject to those 
limits. In order to extend the reserve fund to mandatory 
spending controlled by the authorizing committees, the 
appropriate amount could be credited to the PAYGO scorecard.

              TITLE III-ENFORCEMENT OF BUDGETARY DECISIONS

                              SECTION 301

    Section 301 states that the purposes of title III are to 
close loopholes in the enforcement of the budget resolution, 
require committees of the House of Representatives to include 
budget compliance statements in reports accompanying all 
legislation, require committees to justify the need for Budget 
Act waivers, and provide cost estimates for conference reports.

                              SECTION 311

    Subsection (a) amends section 315 of the Budget Act to 
extend restrictions on considering tax and spending bills 
before the budget resolution is adopted and points of order 
against bills that breach the levels in the budget resolution 
to nonreported bills. Under the current law, these restrictions 
apply in the House only to reported bills, amendments, 
conference reports, and motions to recommit.
    Subsection (b) amends section 303(b) of the Budget Act by 
eliminating the exception for considering certain revenue bills 
before the budget resolution is enacted or a concurrent budget 
resolution is agreed upon.

             Subtitle B--Compliance with Budget resolution

                              SECTION 321

    Section 321 amends clause 3(d) of rule XIII to require all 
committees reporting a bill or joint resolution to include a 
statement from the chairman of the Budget Committee, if he 
submits such a statement to the committee, on whether the bill 
complies with the budget resolution. The statement is similar 
to letters that chairmen of the House Budget Committee 
routinely sent to the Rules Committee before it meets to 
consider a rule providing for the consideration of a bill that 
violates the Congressional Budget Act.
    The statement must identify whether the bill breaches the 
relevant committee's allocation or the ceiling on total 
spending authority or reduces revenue below the revenue floor.
    The statement may also include a discussion of the 
budgetary implications of a bill, the discretionary spending 
limits, or PAYGO requirements. Occasionally a bill may be in 
compliance with the Budget Act but have the potential to 
trigger a sequester for increasing the deficit. For example, a 
bill increasing budget authority may be within the levels 
assumed in the reporting committee's allocation for the first 
year and the 5-year total, and hence in compliance with the 
Budget Act, but capable of triggering a PAYGO sequester because 
it increases the deficit in the second year.

            Subtitle C--Justification for Budget Act Waivers

                              SECTION 331

    Section 331 amends clause 6 of rule XIII to prohibit the 
House from considering any rule, in the form of a House 
resolution, that waives sections 302(f), 303(a), 311(a), or 401 
of the Budget Act unless the report accompanying the resolution 
includes a description of the provision being waived, reasons 
why the waiver is appropriate, and the estimated cost of the 
provisions for which the waiver is provided. The requirement is 
enforced by a point of order that would preclude House 
consideration of the House resolution providing for the 
consideration of the bill in question.

             Subtitle D--CBO Scoring of Conference Reports

                              SECTION 341

    Subsection (a) amends section 402 of the Budget Act to 
direct CBO to prepare cost estimates, when practicable, for all 
conference reports.
    Subsection (b) further amends section 401 of the Budget Act 
to require the statement of managers accompanying any such 
conference report for a bill or joint resolution to include the 
estimate required under subsection (a).

             TITLE IV--ACCOUNTABILITY FOR FEDERAL SPENDING

                              SECTION 401

    Section 401 states that the purposes of this title are to 
encourage reauthorization of all programs, permit amendments to 
subject new entitlement programs to annual appropriations, 
justify allocations that bypass the appropriations process, 
direct CBO to provide cost estimates for conference reports, 
and to require a vote on any legislation that increases the 
limit on the statutory debt.

               Subtitle A--Limitations on Direct Spending

                              SECTION 411

    Subsection (a) replaces the existing restrictions on 
mandatory spending under section 401 of the Budget Act with a 
restriction against consideration of legislation in the House 
and Senate that provides direct spending for a new program, 
project, or activity unless the spending authority is limited 
to a period of 10 or fewer years. It is enforced by a point of 
order that may be raised against any bill or joint resolution, 
amendment, or conference report that authorizes a direct 
spending program for a period of greater than 10 years.
    The point of order applies only to ``new'' programs. It 
neither applies to expansions in existing programs nor the 
underlying programs that may be subject to amendment. The 
committee does not intend for the exception for new programs to 
provide a loophole for fundamentally new programs that are 
grafting new direct spending programs into existing programs. 
Therefore, the burden falls on the proponents of a bill or 
amendment that is subject to the point of order to show that it 
does not create a new entitlement.
    In applying this point of order, it is essential to 
determine whether a program is ``new'' or simply a change in an 
existing one. Such a determination is made by assessing the 
qualities and nature of the legislative language, rather than 
any baseline projections.
    A program is new if it meets any of the following three 
criteria:

- It has a fundamental purpose that is distinct from an 
    existing program.

- It has a substantially different method by which a 
    fundamental purpose is carried out or administered.

- It serves a class of persons or entities distinct from the 
    existing program to which the authorizing language may be 
    appended.

    Fundamental Purpose: If a program has a fundamental purpose 
which is distinct from any other program, and does not relate 
to an existing program, then it would be considered new. In 
determining the fundamental purpose of authorizing language, 
the broad scope and the stated purpose of the language are 
indicative, and ancillary purposes merely suggested by the 
language need not be determinative. Authorizing language which 
would amend an existing program to such an extent as to change 
its fundamental purpose would also be considered new. This 
might include broadening a very specific purpose to a more 
general one. Expanding on the fundamental purpose, such as 
offering additional services, does not constitute a change in 
purpose, and hence language which might offer a new benefit, if 
it is related to the fundamental purpose of an existing program 
would not be considered a new program.

    Substantially Different Method: Authorizing language which 
may have a similar fundamental purpose as an existing program, 
but contemplates a method of accomplishing that end that is not 
closely similar to the existing program, then that 
authorization would be considered as creating a new program. 
For instance, under the existing Medicare program, expenses for 
prescription drugs are not now provided for in the overall 
benefit for senior Americans. Legislation that would expand the 
basic Medicare benefit to include prescription drugs would 
serve the same fundamental purpose as the existing Medicare 
program because it is a related facet of the health care 
coverage benefit.
    If an existing program has a fundamental purpose which is 
broad in scope and has a general method of achieving that 
purpose, and authorizing language is included in a modification 
or reform of the program which proposes to achieve the same end 
through a related but more specific method, then the 
authorizing language would not be considered to have created a 
new program. The reverse would not be the case, a program which 
has a very specific method of achieving its fundamental purpose 
which would be reformed by providing a related but more general 
method would be considered to be creating a new program.

    Distinct Class of Persons or Entities: A program may have a 
fundamental purpose to assist a class. A class may be made up 
of persons or entities, the latter having a broad range of 
possibilities like local governments, States, corporations, 
nonprofit groups, or schools. A class may be defined as any 
identifiable group that relates to the fundamental purpose of a 
program. If the fundamental purpose seeks to achieve the policy 
goal by benefitting or serving an identifiable group, then that 
group would constitute a class. When authorizing language has 
the same fundamental purpose as an existing program, and would 
use the same method of achieving that purpose, but would serve 
a wholly new class, then that authorizing language would be 
considered to create a new program. However, authorizing 
language that provides for additional benefits or services to a 
more specific group that is substantially within the class, 
then that would not constitute a new program. Authorizing 
language which provides for a substantially broader class, even 
though wholly including the existing program class, would also 
be considered to create a new program.
    Subsection (b) amends the table of contents in section 9(b) 
of the Budget Act to reflect the point of order for fixed-year 
authorizations.
    Subsection (c) adds a new clause to House Rule XXI to 
prohibit the consideration of legislation that authorizes the 
appropriation of new budget authority for a new program unless 
the authorization is limited to a period of 10 of fewer fiscal 
years. The prohibition is enforceable with a point of order 
that can be raised against any bill, joint resolution, 
amendment or conference report which is authorized indefinitely 
or for a period in excess of 10 years.

                              SECTION 412

    Subsection (a) amends clause 5 of rule XVIII to prohibit 
any House resolution from waiving the right of the 
Appropriations and Budget committee chairmen in the committee 
to offer an amendment in the Committee of the Whole to subject 
a new program to annual appropriations unless the resolution 
specifically waives section 4 of House Rule XXIII as amended by 
this act. As in section 411 of the bill, the authority to offer 
such an amendment under this section is limited to new 
programs. The amendment is debatable for 20 minutes.
    Subsection (b) amends Title 2, U.S. Code, Section 902 
(Section 252 of the Deficit Control Act) and Title 2, U.S. 
Code, Section 645 (Section 314(b) of the Budget Act) to 
establish a procedure for holding the limits on discretionary 
spending and the appropriate levels in the budget resolution 
for any new discretionary program that is offset with 
reductions in mandatory savings. As part of the amendment under 
subsection (a), the amendment may designate a portion of the 
reduction in direct spending as an offset to an authorization 
of discretionary appropriations for a new program. If such an 
amendment is agreed to and the bill is enacted, then the 
discretionary spending limits and the appropriate allocations 
in the budget resolution are adjusted by the amount provided 
for the specified program but not to exceed the amount of 
designated offsets in the first fiscal year. In the outyears, 
the discretionary spending limits are simply increased by the 
amount of the mandatory offset. Further, savings from such 
mandatory offsets are not credited against PAYGO. On a 
comparable basis, the Budget Committee chairman is directed to 
reduce the allocations of the reporting committee by the amount 
of the designated offset.
    The intent of this provision is to remove several 
disincentives for subjecting programs to annual appropriations. 
First, the Appropriations Committee is held harmless for the 
new programs because they are not forced to underfund existing 
priorities for any new discretionary programs. Moreover in the 
outyears the Appropriations Committee is free to use the 
additional funds for whatever program it deems necessary. 
Second, the authorizing committees are given some assurance 
that the Appropriations Committee will fund the new 
discretionary programs because in the first year the caps are 
increased by the amount that is actually appropriated for the 
specified programs.
    Nothing in the section is to be construed as changing the 
exemption found in the Deficit Control Act for any program not 
currently subject to the budget resolution, discretionary 
spending limits or PAYGO requirements. In the event a mandatory 
program that currently is exempt from PAYGO requirements is 
subjected to discretionary appropriations by a subsequent law, 
the Committee believes that such a law should also exempt the 
new discretionary program from the discretionary spending 
limits.

     Subtitle B--Enhanced Congressional Oversight Responsibilities

                              SECTION 421

    Subsection (a) amends clause 2(d)(1) of rule X to require 
all committees to include in their oversight plans a timetable 
for reauthorizing all laws, programs, or agencies within its 
jurisdiction. The timetable applies to both mandatory and 
discretionary programs. The intent of this requirement is to 
build into House rules the presumption that programs should be 
reauthorized and to encourage committees to systematically 
review all programs as they carry out their oversight 
responsibilities.
    The committee notes that this requirement does not 
automatically terminate or sunset the authorization of any 
programs that are included in any oversight schedule submitted 
pursuant to this section. Nor does this specifically terminate 
the authorization of any program that is not reauthorized 
according to the oversight schedule. Furthermore, the committee 
expects there will be times when it may be appropriate for the 
House to waive the requirement for reauthorizing certain 
programs that by their very nature must be permanent.
    Subsection (b) amends clause 4(a) of House Rule X, which 
requires the Appropriations Committee to study provisions of 
law that provide spending authority or permanent budget 
authority and from time to time report its recommendations for 
terminating or modifying such provisions. The subsection amends 
House Rule X to require the report be submitted at least once 
each Congress.
    Subsection (c) amends the requirement that standing 
committees review whether mandatory programs within their 
jurisdiction should be subjected to annual appropriations under 
Clause 4(e)(2) of House Rule X to require that such review be 
undertaken at least every 10 years.

                              SECTION 422

    Subsection (a) amends section 302(a) of the Budget Act to 
require the joint statement accompanying a budget resolution to 
justify any allocation of mandatory spending authority.
    Similarly subsection (b) amends 1105(a) of Title 31 of the 
United States Code to require the President to include a 
justification for any budget that requests funding for a new 
program, project, or activity that is not subject to 
discretionary appropriations.
    Finally, subsection (c) amends clause 4(e)(2) of rule X to 
require any committee that reports a bill providing budget 
authority not subject to annual appropriation to include a 
similar justification to that required under subsections (a) 
and (b).

                              SECTION 423

    Section 423 amends clause 1(d) of rule XI to require 
committees to include in their activity reports, which are 
filed at the conclusion of each Congress, a summary of all 
bills reported by that committee that were considered before 
the budget resolution was agreed to, in excess of the 
allocations or aggregates, or provided direct spending for a 
new program, project, or activity for which the authorization 
was not limited to a period of 10 or fewer years under sections 
303(a), 302(a), 311(a), and 401(a) of the Budget Act, 
respectively. The reports must also specify the total amount by 
which legislation reported by such committees exceeded their 
allocations or aggregates.

                              SECTION 424

    Section 424 amends section 703 of the Budget Act, which is 
a standing requirement for the Budget Committee to study and 
report to the Congress proposals to limit program 
authorizations. Section 424 requires such a report to be 
submitted during the 106th Congress. In addition to the 
existing requirement that it establish maximum and minimum time 
limitations for program authorizations, section 424 also 
requires the Budget Committees to report guidelines for 
evaluating whether existing programs should be subject to 
annual appropriations and any recommended changes in budget 
control mechanisms or scorekeeping conventions to facilitate 
such conversions.

                              SECTION 425

    Section 425 amends section 404 of the Budget Act to require 
GAO to submit once every 5 years a report on programs, 
projects, and activities with permanent appropriations or which 
otherwise are not subject to annual appropriations. Currently 
the frequency of such reports is at GAO's discretion.

                Subtitle C--Strengthened Accountability

                              SECTION 431

    Subsection (a) amends section 308(a)(1)(B) to require 
committees to include in the reports accompanying each reported 
bill or joint resolution a cost estimate prepared by CBO that 
covers a period of 10 fiscal years.
    Subsection (b) amends section 402(1) of the Budget Act to 
require CBO to prepare a cost estimate for each reported bill 
or resolution covering a period of 10 fiscal years.
    Subsection (c) amends clause 3(d)(2)(A) of House Rule XIII 
to require each report to include a cost estimate that covers a 
period of 10 fiscal years.
    The Committee does not intend to automatically enforce 
these estimates under sections 302(f) or 311(a) of the Budget 
Act. Nor does it intend to adjust the Senate's 10-year point of 
order set forth in section 207 of H.Con.Res. 68 (H.Rept 106-
91). These estimates are intended solely for display purposes. 
The committee will evaluate the accuracy of these estimates and 
determine whether they should be subject to points of order at 
a subsequent date.

                              SECTION 432

    Section 432 repeals House Rule XXIII which enables the 
House to pass a bill increasing the statutory limit on the 
public debt without a recorded vote. Rule XXIII directs the 
Clerk of the House to engross a bill increasing the debt limit 
upon the passage of the budget resolution in the House. It 
further provides that the vote on the budget resolution is 
deemed a vote on the bill increasing the debt limit. The bill 
does not extend the Senate's 10-year point of order to the 
House or modify the existing points of order under Sections 
302(f) and 311(a) of the Budget Act.

    TITLE V--BUDGETING FOR UNFUNDED LIABILITIES AND OTHER LONG-TERM 
                              OBLIGATIONS

                              SECTION 501

    Section 501 states that the purposes of this title are to 
require that the Federal Government budget for the long-term 
costs of Federal insurance programs, improve congressional 
control over unfunded liabilities for those insurance programs, 
and provide information on the long-term budgetary trends.

               Subtitle A--Budgetary Treatment of Federal
                           Insurance Programs

                              SECTION 511

    Consistent with the Credit Reform Act of 1990, which was 
codified as title V of the Budget Act, the insurance subtitle 
is added as a new title VI to that act. Subsequent references 
are to the proposed section in title VI of the Budget Act.

- Section 601 of the Budget Act, as amended, cites this title 
    as the ``Federal Insurance Budgeting Act of 1999''.

- Section 602(a) of the Budget Act, as amended, requires the 
    President's budget submission as required under Section 
    1105(a) of Title 31 of the United States Code include the 
    risk-assumed cost of Federal insurance programs beginning 
    in fiscal year 2006.

- Section 602(b) of the Budget Act, as amended, establishes the 
    accounting system for the transactions of Federal insurance 
    programs once risk-assumed budgeting is fully adopted. A 
    program account pays both the risk-assumed costs borne by 
    the taxpayer to the financing account and the 
    administrative costs of the insurance program. The 
    financing account receives premium and other income, pays 
    out all claims for insurance and receives all recoveries, 
    and transfers to the program account payment for 
    administrative costs. Any negative risk-assumed costs are 
    transferred from the financing account to the program 
    account and then to the general fund. Payments by or 
    receipts of the financing accounts are treated as a means 
    of financing.

- Section 602(c) of the Budget Act, as amended, provides that 
    additional commitments for insurance programs after fiscal 
    year 2006 may only be made if the full risk-assumed cost is 
    appropriated in advance by an appropriations Act. Further, 
    the budget authority for any action that increases the 
    risk-assumed cost of outstanding commitments must be 
    provided in advance.

- Section 602(d) of the Budget Act, as amended, provides for 
    reestimates on an annual basis. If the reestimates are 
    positive, then an amount is automatically paid from the 
    program account to the financing account. If it is 
    negative, then the amount is paid from the financing 
    account to the program account, which is then transferred 
    from the program account to the general fund.

- Section 602(e) of the Budget Act, as amended, provides that 
    program account payments for administrative costs shall be 
    readily identifiable in the budget.

- Section 603(a) of the Budget Act, as amended, establishes the 
    timetable for the implementation of risk-assumed budgeting. 
    Federal agencies are required to submit preliminary models 
    for estimating risk of insurance programs along with all 
    relevant data and assumptions to OMB with their budget 
    requests for fiscal year 2002.

- Section 603(b) of the Budget Act, as amended, prescribes 
    notice and comment procedures for developing the models 
    used to assess risk. Both OMB and CBO provide a notice of 
    availability in the Federal Register of the models, data, 
    and assumptions that it intends to use to estimate risk for 
    each insurance program.

- Section 603(c) of the Budget Act, as amended, requires 
    Federal agencies, OMB, and CBO to revise their models, 
    data, and assumptions based upon any comments submitted to 
    it and in consultation with the Budget Committees. OMB is 
    required to submit a second notice of availability for 
    revised modes, data, and assumptions when it submits the 
    President's budget for fiscal year 2003.

- Section 603(d) of the Budget Act, as amended, requires the 
    President to include, for display purposes only, the risk-
    assumed costs of Federal insurance programs in his budget 
    submissions for fiscal years 2003, 2004, and 2005. These 
    submissions must include a presentation for each Federal 
    insurance program at the account level, a summary table of 
    risk-assumed costs, and an alternative summary table of 
    budget aggregates and functions using risk-assumed 
    measures. CBO also is required to estimate the risk-assumed 
    cost of insurance programs in its economic outlook report 
    and its analysis of the President's budget.

          Beginning in the second session of the 107th 
        Congress, CBO is required to display its estimates of 
        the risk-assumed costs of legislation affecting Federal 
        insurance programs in the estimates required under 
        Section 308 of the Congressional Budget Act of 1974 and 
        Clause 3(c), Rule XIII of the Rules of the House of 
        Representatives.

- Section 603(e) of the Budget Act, as amended, requires CBO, 
    OMB, and GAO to submit a report evaluating the 
    implementation of risk-assumed budgeting. The report must 
    be submitted 6 months after the President submits his 
    budget for fiscal year 2005. The report is required to 
    address the following:

        The adequacy of the models;

        The availability and reliability of the data;

        The appropriateness of the implicit or explicit 
        discount rate used in the models;

        The relationship between risk-assumed budgeting and 
        statutory control over the budget;

        The overall benefits of risk assumed cost estimates;

        The ability of the appropriate agencies to obtain the 
        necessary information;

        An assessment whether risk-assumed budgeting improves 
        the budget process; and

        The advisability of continuing to budget for each 
        program on a risk-assumed basis.

- Section 604 of the Budget Act, as amended, defines the terms 
    used in this title:

          Federal insurance program--a program that makes 
        insurance commitments, including at a minimum a list to 
        be included in the statement of managers accompanying 
        the conference report on this legislation. The 
        committee assumes that the list will include: bank 
        deposit insurance, savings association deposit 
        insurance, national credit union share insurance, 
        pension insurance, national flood insurance, Federal 
        crop insurance, aviation war-risk insurance, maritime 
        war-risk insurance, service-disabled veterans 
        insurance, veterans mortgage life insurance, Federal 
        employees' life insurance, political risk insurance 
        (OPIC), and the national vaccine injury compensation 
        program.

          Insurance commitment--an agreement in advance by a 
        Federal agency to indemnify a nonfederal entity against 
        specified losses. The bill specifically excludes loan 
        guarantees and benefit programs such as Social Security 
        and Medicare from this definition.

          Risk-assumed cost--the net present value (NPV) of the 
        estimated cash flows to and from the Federal Government 
        resulting from an insurance commitment or modification 
        in such a commitment.

          Cost of a modification--the difference between the 
        current estimate of the NPV of the remaining cash-flows 
        under the terms of the insurance commitment and the 
        current estimate of the NPV of the remaining cash-flows 
        under the terms of the insurance commitment as 
        modified.

          Cost of a reestimate--the difference between the NPV 
        of the amount required by the financing account to pay 
        estimated claims and other expenditures and the amount 
        available in the financing account.

          Expected administrative costs--the amount estimated 
        to be necessary for the proper administration of the 
        insurance program

          Program account--the budget account for the risk-
        assumed costs, and for paying all costs of 
        administering the insurance program.

          Financing account--the nonbudget account that is 
        associated with each program account which receives 
        payments from or makes payments to the program account, 
        receives premiums and other payments from the public, 
        pays insurance claims, and holds balances.

          Modification--a governmental action that alters the 
        risk-assumed cost of an existing insurance commitment 
        from the current estimate of cash-flows and includes 
        action resulting from new legislation or the exercise 
        of administrative discretion under existing law that 
        alters the estimated cost of existing insurance 
        commitments.

          Model--any actuarial, financial, econometric, 
        probabilistic, or other methodology used to estimate 
        the expected frequency and magnitude of loss-producing 
        events, expected premiums or collections from or on 
        behalf of the insured, expected recoveries, and 
        administrative expenses.

          Current--the same meaning as in Section 250(c)(9) of 
        the Deficit Control Act, which ties estimates to the 
        most recently submitted President's budget.

          OMB--the Director of the Office of Management and 
        Budget.

          CBO--the Director of the Congressional Budget Office.

          GAO--the Comptroller General of the United States.

- Section 605(a) of the Budget Act, as amended, authorizes the 
    appropriation of $600,000 for each of fiscal years 2000 and 
    2005 for OMB and the relevant agencies to contract with 
    outside actuaries and other experts to develop these 
    models. The committee recognizes that such appropriations 
    may be necessary because many agencies do not have 
    personnel with expertise in risk assessment techniques and 
    that the private sector offers more lucrative compensation 
    to experts in the field.

- Section 605(b) of the Budget Act, as amended, provides the 
    Secretary of the Treasury the authority to engage in all 
    necessary transactions with the financing accounts.

- Section 605(c) of the Budget Act, as amended, creates a 
    financing account for each insurance program and 
    appropriates the amount of the risk-assumed cost for that 
    program as of the close of September 30, 2005.

- Section 606(a) of the Budget Act, as amended, provides that 
    this subtitle is effective on enactment and expires on 
    September 30, 2007. It provides that if the title is not 
    reauthorized by that date, then the accounting structure 
    and budgetary treatment reverts to the structure and 
    budgetary treatment in effect before the enactment of this 
    title.

- Section 605(b) of the Budget Act, as amended, provides a 
    table of contents for Title VI of the Budget Act.

           Subtitle B--Reports on Long-Term Budgetary Trends

                              SECTION 521

    Subsection (a) amends section 1105(a) of title 31, United 
States Code, to require the President's budget submission to 
include for every fifth year a 75-year projections of total 
budget authority and outlays, revenue, surpluses, or deficits. 
The projections are to be based on both current law and the 
President's proposed policies. Over this same period, OMB is 
required to include projections for Social Security, Medicare, 
Medicaid, and all other direct spending. The projections are to 
be accompanied with a sensitivity analysis of key variables. 
Finally, the two sets of projections are to be compared with 
respect to their effect on the economy.
    Subsection (b) amends section 202(e)(1) to require CBO to 
include the same projections based on current law as required 
under subsection (a) in its annual report The Economic and 
Budget Outlook.

     TITLE VI--BASELINES, BYRD RULE, LOCK-BOX, AND OTHER FAIL-SAFE 
                               MECHANISMS

                              SECTION 601

    Section 601 states that the purposes of this title are to 
require budgetary comparisons to the prior year's level, 
restrict the application of the Byrd rule to Senate-reported 
reconciliation bills, and establish a procedure to allow 
savings from amendments to be dedicated to increasing the 
surplus.

                        Subtitle A--The Baseline

                              SECTION 611

    Subsection (a) amends Section 1105(a) of Title 31, United 
States Code, to require the President's budget submission to 
compare estimated expenditures and proposed appropriations for 
the budget year and the current year and include the percentage 
change between the two for all displays other than the detailed 
budget estimates.
    Subsection (b) amends Section 1005(a)(6) of Title 31, 
United States Code, to require OMB to compare projected 
receipts under current law and as proposed by the President for 
the budget year and to show the percentage change under current 
law and as proposed between the current year and each of the 9 
outyears.
    Subsection (c) amends Section 1105(a)(12) of Title 31, 
United States Code, to require for each proposal in the budget 
for legislation that would establish or expand a government 
activity or function, an estimate of the estimated amount for 
the same activity or function, if any, in the current year and 
the percentage change between this level and the amount 
proposed in the budget for appropriation and for expenditure. 
The budget submission must also show the estimated 
appropriation for each proposal for a period of 5 fiscal years.
    Subsection (d) expands an existing requirement under 
Section 1105(a)(18) of Title 31, United States Code, to include 
a comparison of the proposed amount of new budget authority for 
each mandatory program in the budget year with the 
corresponding amounts in the current fiscal year.
    Subsection (e) adds two new requirements to the President's 
budget submission in Section 1105(a) of Title 31, United States 
Code: a comparison by function and subfunction of the estimated 
and proposed appropriations for the budget year and the current 
fiscal year; and a table disaggregating sources of growth in 
direct spending under current law for the budget year and each 
of the 4 outyears.
    Subsection (f) amends Section 1109(a) of Title 31, United 
States Code, to clarify that the estimates of the current 
services budget are to assume the adjusted levels of the 
discretionary spending limits and if no such limits are in 
effect then the adjusted discretionary spending levels for the 
last year in which such limits were in effect.

                              SECTION 612

    Subsection (a) amends Section 301(e) of the Budget Act to 
require the Budget Committees to mark up from prior year 
levels. It requires the mark up documents to include a 
comparison of spending levels to the prior fiscal year. In the 
House, this would apply to both the conceptual phase of the 
markup when the committee considers tentative levels and the 
formal phase when it considers legislative amendments to the 
budget resolution. Subsection (a) also requires the report 
accompanying the budget resolution to include a comparison of 
the proposed levels for the budget year with the current year. 
These two provisions essentially codify Rules 8(a) and 24 of 
the Rules of Procedure of the Committee on the Budget for the 
106th Congress.

                              SECTION 613

    Subsection (a) amends Section 202(e)(1) of the Budget Act 
to require CBO to include in its annual report to the Congress, 
The Economic and Budget Outlook, a comparison of alternative 
budgetary levels and tax expenditures for the budget year with 
the comparable levels in the prior year.
    Subsection (b) further amended section 202(e)(1) of the 
Budget Act to require CBO to include in the The Economic and 
Budget Outlook an analysis of sources of projected growth in 
direct spending under current law (comparable to the report in 
the President's budget required under section 611(f)).
    Subsection (c) amends section 308(a)(1)(B) to require CBO 
to include in its cost estimates a comparison of proposed 
levels to the comparable levels in the current fiscal year.

                              SECTION 614

    Section 614 stipulates that, unless otherwise provided by 
law, budgetary projections for fiscal years in which there are 
no discretionary spending limits are to assume that 
discretionary spending at levels consistent with the 
discretionary spending limits in the last fiscal year they were 
in effect.

                       Subtitle B--The Byrd Rule

                              SECTION 621

    Section 621 amends Section 313 of the Budget Act to exempt 
conference reports accompanying reconciliation bills from the 
Byrd rule. The Byrd rule prohibits consideration in the Senate 
of any provision in a reconciliation bill that is 
``extraneous'' to the purposes of a reconciliation bill. While 
a point of order under section 313 could still be raised in the 
Senate during its initial consideration of a reconciliation 
bill, it could not be raised against any provision in a 
conference report. Consequently, provisions that were in the 
original House-passed reconciliation bill that were 
incorporated into the conference report will no longer be 
subject to the Byrd rule.

              Subtitle C--Spending Accountability Lock-Box

                              SECTION 631

    Section 631 cites this subtitle as the Spending 
Accountability Lock-Box Act of 1999.

                              SECTION 632

    Subsection (a) sets forth the procedures for reducing the 
budget resolution's allocations and aggregates for floor 
amendments as a new section 318 of the Budget Act. In Section 
318(a) of the Budget Act as amended, the Budget Committee 
chairmen are required to keep three ledgers to keep track of 
the amount of savings from floor amendments to appropriation 
bills. Each ledger includes three entries: House lock-box 
balance, Senate lock-box balance, and joint lock-box balance.

- Section 318(b) of the Budget Act, as amended, requires that 
    the amount entered in the ledger shall consist of amounts 
    credited to it under subsection (c) except that it may not 
    include a negative entry that would constitute an increase 
    in an appropriations.

- Section 318(c) of the Budget Act, as amended, permits Members 
    offering amendments on the House or Senate floor to state 
    the portion of the savings that should be credited to a 
    lock-box, used as an offset for an increase in another 
    account, or allowed to remain within the subcommittee's 
    302(b) allocation. If the sponsor of an amendment makes no 
    such statement, then the reduction is automatically 
    credited to the lock-box. Section 318(c) of the Budget Act, 
    as amended, further directs the Budget Committee chairmen, 
    upon the engrossment of any Senate amendment to the House 
    bill, to credit to the lock-box an amount equal to the 
    amount by which amendments, if passed, reduce budget 
    authority and outlays. The entries are to be upon the 
    engrossment of the applicable appropriation bills in the 
    House or Senate. Only amendments that passed either House 
    are credited to the appropriate lock-box.

          In the case of a conference report, the Budget 
        Committee chairmen are required to credit to the joint 
        House-Senate lock-box an amount equal to the sum of one 
        half the amount credited to the lock-box balance in the 
        House and Senate-passed bills.

- Section 318(d) of the Budget Act, as amended, applies lock-
    box procedures to all appropriation bills, which it defines 
    as general and special appropriation bills, supplemental, 
    deficiency or continuing appropriation bills, and joint 
    resolutions. Section 318(e) also requires the Budget 
    Committee chairmen to keep a running balance of the savings 
    from floor amendments.

    Subsection (b) of the bill amends the table of contents in 
Section 1(b) of the Budget Act to reflect the lock-box 
procedures under the congressional budget process.

                              SECTION 633

    Subsection (a) amends section 302(a) of the Budget Act to 
require the Budget Committees chairmen to reduce the 302(a) 
allocations by the amount credited to the joint House-Senate 
lock-box for those bills upon the engrossment of the Senate 
amendments to any appropriation bills. The Budget Committee 
chairmen are required to have printed in the Congressional 
Record the adjusted levels.
    Subsection (b) amends section 302(b) of the Budget Act to 
require the Appropriations Committees to make the comparable 
adjustments in the 302(b)allocations. The Appropriations 
Committee chairmen are also required to have these levels 
printed in the Record.

                              SECTION 634

    Section 634 stipulates that the monthly scorekeeping 
reports submitted pursuant to Section 308(b)(1) of the Budget 
Act should include updates on the amounts credited to the lock-
box ledger.

                              SECTION 635

    Section 635 requires comparable adjustments in the 
discretionary spending limits to those in the allocations and 
aggregates under section 634. In order to provide a statutory 
basis for making the adjustment, the legislative text of the 
conference reports must contain a statement that specifies that 
the discretionary spending limits are to be reduced by the 
amount credited to the lock-box. The statement is to read as 
follows:

          As required by Section 635 of the Spending 
        Accountability Lock-Box Act of 1999, for fiscal year 
        [insert appropriate fiscal year] and each outyear, the 
        adjusted discretionary spending limit for new budget 
        authority is reduced by $ [insert appropriate amount of 
        reduction] and the adjusted discretionary limit for 
        outlays is reduced by [insert appropriate amount of 
        reduction] for the fiscal year and each outyear.

              Subtitle D--Automatic Continuing Resolution

                              SECTION 641

    Subsection (a) of the legislation amends Chapter 13 of 
Title 31, United States Code, by adding a new section 1311, to 
provide for an automatic continuing appropriation for programs, 
projects, or activities for which appropriation bill were not 
enacted by the beginning of the fiscal year.

- Section 1311(a)(1) provides an automatic appropriation if a 
    regular bill or joint resolution making continuing 
    appropriations is not enacted by the beginning of the 
    fiscal year. The appropriation is made out of corporate and 
    other receipts held by the Treasury Department, applicable 
    corporate or other revenue, receipts, and sums. The 
    appropriation is for only those projects or activities that 
    received an appropriation in the prior year (or in the 
    event there were none, the joint resolution for the 
    preceding year).

- Section 1311(a)(2) specifies that the level of the automatic 
    appropriation is at the rate of operations in the prior 
    fiscal year provided in a regular appropriations act (or 
    the preceding year if there was a joint resolution). Any 
    determination of the rate of operations, however, excludes 
    amounts for emergencies (under current law and amounts in 
    excess of the reserve fund in title II), IMF, or arrearages 
    under sections 251 and 252 of the Deficit Control Act. 
    These items are excluded from the base because they 
    represent on-time expenditures and, if retained, could 
    contribute to a breach of the discretionary spending 
    limits.
    At the same time, the determination of the rate of 
    operations encompasses all other enacted levels other than 
    continuing resolutions that are less than 1 year, 
    rescissions and appropriations in supplemental, rescission, 
    and special appropriations acts. Additionally, the 
    determination sets out amounts sequestered because of a 
    breach in the discretionary spending limits in the prior 
    fiscal year.
    If the continuing resolution under this section is in 
    effect in one year and the corresponding appropriations act 
    are not enacted in the following year, another continuing 
    appropriation would be automatically provided in the second 
    year at the levels provided by the continuing resolution 
    for the first year. As a consequence, there would be no 
    shutdown in the second fiscal year.

- Section 1311(a)(3) states that the automatic appropriations 
    shall first become available on the first day of a lapse in 
    appropriations. It ends on either the date on which the 
    applicable regular appropriations bill becomes law or the 
    last day of the fiscal year, whichever is earlier. 
    Consequently, the continuing resolution does not provide 
    for a permanent appropriation.

- Section 1311(b) provides that an automatic appropriation 
    under this section shall be subject to the terms and 
    conditions imposed for that appropriation in the preceding 
    fiscal year.

- Section 1311(c) provides that any automatic appropriation for 
    a program, project, or activity covers all obligations and 
    expenditures for such project (or as otherwise provided 
    under current law).

- Section 1311(d) specifies that expenditures for an automatic 
    appropriation are charged to the same appropriation fund or 
    authorization as the regular appropriation bill or joint 
    resolution that succeeds it in the same fiscal year.

- Section 1311(e) provides that the automatic appropriation 
    does not apply to any program, project, or activity for 
    which another provision of law either makes the funds 
    available or grants authority for it to continue. Moreover, 
    the interim appropriation is not effective if a provision 
    of law specifically provides no appropriations shall be 
    made, or funds made available, for such a program, project, 
    or activity during a lapse in appropriations.

- Section 1311(f) defines a regular appropriation bill as a 
    bill making appropriations for the following:

        Agriculture, rural development, and related agencies 
        and programs;

        the Departments of Commerce, Justice and State, the 
        judiciary, and related agencies;

        the Department of Defense;

        the government of the District of Columbia and other 
        activities chargeable in whole or in part against the 
        revenues of the District;

        the Departments of Labor, Health and Human Services, 
        and Education, and related agencies;

        the Department of Housing and Urban Development, and 
        sundry independent agencies, boards, commissions, 
        corporations and offices;

        Energy and water development;

        foreign assistance and related programs;

        the Department of the Interior and related agencies; 
        military construction;

        military construction, family housing, and base 
        realignment and closure for the Department of Defense;

        the Department of Transportation and related agencies;

        the Treasury Department, the U.S. Postal Service, the 
        Executive Office of the President, and certain 
        independent agencies; and

        the legislative branch.

    Subsection (b) of the legislation makes a conforming change 
in Section 202(e) of the Budget Act relating to a CBO report on 
unauthorized programs.
    Subsection (c) of the legislation adds the continuing 
appropriation to the table of contents set forth in Chapter 13 
of Title 31, United States Code.
    Subsection (d) of the legislation clarifies that this 
section should not be construed to affect government oblations 
mandated by other law, including Social Security, Medicare, and 
Medicaid.

              TITLE VII--BUDGETING IN AN ERA OF SURPLUSES

    Title VII restates much of the PAYGO requirements in 
section 252 of the Deficit Control Act, but amends the act to 
ensure there is no sequester if there is an on-budget surplus, 
to require additional offsets if the on-budget surplus 
declines, and to clarify that the costs of all direct spending 
or receipts legislation are included in sequestration 
calculations.

                              SECTION 701

    Subsection (a) changes the purpose of PAYGO set forth in 
Section 252(a) of the Deficit Control Act from that of assuring 
that direct spending and receipts legislation does not increase 
the deficit to that of assuring that the costs of such 
legislation does not exceed the on-budget surplus.
    Subsection (b) amends the calculation of any sequester in 
Section 252 (b) of the Deficit Control Act to reduce the amount 
of any sequester by the amount of OMB's estimate of the on-
budget surplus. In other words, if the estimated on-budget 
surplus is larger than the net cost of all PAYGO legislation 
for that budget year there is no sequester. If in the budget 
year the surplus is less than the costs of the legislation, 
then the amount of the sequester is reduced by the difference 
between the costs of the legislation and the amount of the on-
budget surplus.
    To take a simple example, there would be no sequester if, 
for a given budget year, legislation was enacted providing for 
a $2-billion tax cut and a $1-billion entitlement expansion if 
the on-budget surplus is at least $3 billion in that same year 
(assuming no other direct spending or receipt legislation has 
been enacted).
    It is important to note that section 701 does not require 
the Congress to use the on-budget surplus to offset tax cuts. 
If Congress does not pass legislation that reduces revenue by 
the amount of the surplus, then the surplus would be implicitly 
used to reduce the Federal debt. Similarly, the Congress could 
use the surplus to offset an entitlement expansion--although 
that is clearly not the intent of the majority of the 
committee.
    Subsection (c) specifies several assumptions for OMB and 
CBO to make in estimating the on-budget surplus, if any, in the 
sequester reports. For the mandatory side of the budget, the 
projections are to be consistent with the assumptions used to 
calculate projections under the Deficit Control Act. These 
projections must however exclude PAYGO legislation enacted 
after this act because the effect of such legislation is 
already included in the sequester calculation. For 
discretionary spending, the estimate is based on the enacted 
levels in the regular appropriation bills. If such bills are 
not enacted, then the estimates are based on any full-year 
continuing resolution for the budget year (other than the 
continuing resolution in title IV). If no regular or continuing 
appropriation is enacted, then the estimates are based on the 
enacted levels for the current year with various adjustments 
required under the Deficit Control Act. Regardless of what 
levels are used as the base, they must be adjusted for 
supplemental, rescission, and special appropriation acts as 
well as any sequester due to a breach of the discretionary 
spending limits in the appropriate fiscal years.
    Under section (d), OMB is required to use its projection of 
the on-budget deficit or surplus in its Preview Report that is 
submitted with the President's budget submission in January or 
early February in determining whether a sequestration is 
necessary in its final report.
    Subsection (d) stipulates that OMB and CBO are to estimate 
the on-budget surplus in the preview reports that are submitted 
in January or early February. These estimates are used to 
determine the size of any sequester at the conclusion of the 
session.
    The fact that the estimate of the on-budget surplus is 
updated each year has important implications. That is, a tax 
and or entitlement that would not trigger a sequester for a 
given year when it was enacted might trigger a sequester for 
that year because of a decline in the estimated on-budget 
surplus.
    Subsection (e) clarifies that the estimates of the on-
budget surplus do not include the outlays of the Social 
Security trust funds and other off-budget entities. By 
excluding these cash-flows, these PAYGO changes will have no 
bearing on the amounts credited to the Social Security trust 
funds or the actuarial status of these funds.
    Subsection (f) amends Section 258C of the Deficit Control 
Act to extend to the House a Senate procedure for considering 
reconciliation legislation to preempt any PAYGO sequester. 
Under this procedure, each standing committee can submit to the 
Budget Committee of its House a legislative alternative to 
avoid a sequester. After the committees have submitted such a 
report and not later than October 15, the House and Senate may 
pass a simple resolution instructing the committees to submit 
legislation offsetting at least part of the sequester. The 
standing committees are then required to submit their 
recommendations to the Budget Committee, which then reports the 
recommendations in the form of a reconciliation bill to its 
respective House.
       Rollcall Votes and Other Items Required Under House Rules

                              ----------                              


                            COMMITTEE VOTES

    Clause 2(1)(2)(B) of House Rule XI requires each committee 
report to accompany any bill or resolution of a public 
character, ordered to include the total number of votes cast 
for and against on each rollcall vote on a motion to report and 
any amendments offered to the measure or matter, together with 
the names of those voting for and against. Listed below are the 
rollcall votes taken in the House Budget Committee on the 
Comprehensive Budget Process Reform Act of 1999.
    On June 17, 1999, the committee met in open session, a 
quorum being present. The committee adopted and ordered 
reported the Comprehensive Budget Process Reform Act of 1999. 
The following votes were taken in committee:
    1. Mr. Chambliss made a motion to authorize the chairman, 
consistent with Rule XVI, Clause 4 of the Rules of the House, 
to declare a recess at any time during the committee meeting. 
The motion was agreed to by voice vote.
    2. Mr. Nussle offered an amendment in the nature of a 
substitute to H.R. 853, the Comprehensive Budget Process Reform 
Act of 1999. The amendment makes changes to the legislation 
such as adding interest as a discrete category to this 
categories of spending, dropping the definition of a 
Presidential veto for Congressional purposes; and collapsing 
the two distinct emergency reserves, one for direct spending 
and one for discretionary spending into a single reserve fund.
    3. Mr. Spratt offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment strikes 
the joint budget resolution provisions.
    The amendment was not agreed to by a show of hands with 14 
ayes and 23 noes.
    4. Mr. Bentsen offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment to 
strikes various provisions related to the emergency spending 
reserve.
    The amendment was not agreed to on a voice vote.
    5. Mr. Bentsen offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment proposes 
to change the method by which the emergency reserve fund is 
spent. In the amendment in the nature of a substitute, the 
chairman determines when the funding should be released; the 
amendment would require the entire Budget Committee vote on 
whether to designate spending as an emergency.
    The amendment offered was agreed to by voice vote.
    6. Mr. Bentsen offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment strikes 
the title of the legislation related to an automatic continuing 
resolution.
    The amendment offered was not agreed to by a show of hands 
with 14 ayes and 22 noes.
    7. Mr. Bentsen offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment reduces 
the level of spending in the automatic continuing resolution 
from 100 percent of the previous year's level to 75 percent of 
the previous year's level.
    The amendment offered was not agreed to by voice vote.
    8. Mr. Spratt offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment strikes 
title VII of the legislation which changes the way the pay-as-
you-go budget rules are applied.
    The amendment was not agreed on a roll call vote of 13 ayes 
and 20 noes.

----------------------------------------------------------------------------------------------------------------
                                    Aye       No       Present                         Aye       No     Present
----------------------------------------------------------------------------------------------------------------
Mr. Kasich, Chairman...........  ........  X         ..........  Mr. Spratt,         X
                                                                  Ranking.
Mr. Chambliss..................  ........  X         ..........  Mr. McDermott.....  X
Mr. Shays......................  ........  X         ..........  Ms. Rivers........  X
Mr. Herger.....................  ........  ........  ..........  Mr. Thompson......  .......
Mr. Franks.....................  ........  X         ..........  Mr. Minge.........  .......  X
Mr. Smith of Michigan..........  ........  X         ..........  Mr. Bentsen.......  X
Mr. Nussle.....................  ........  X         ..........  Mr. Davis.........  .......
Mr. Hoekstra...................  ........  ........  ..........  Mr. Weygand.......  X
Mr. Radanovich.................  ........  ........  ..........  Mrs. Clayton......  X
Mr. Bass.......................  ........  X         ..........  Mr. Price.........  X
Mr. Gutknecht..................  ........  X         ..........  Mr. Markey........  .......
Mr. Hilleary...................  ........  X         ..........  Mr. Kleczka.......  X
Mr. Sununu.....................  ........  X         ..........  Mr. Clement.......  X
Mr. Pitts......................  ........  X         ..........  Mr. Moran.........  .......
Mr. Knollenberg................  ........  X         ..........  Ms. Hooley........  X
Mr. Thornberry.................  ........  ........  ..........  Mr. Lucas.........  X
Mr. Ryun.......................  ........  X         ..........  Mr. Holt..........  X
Mr. Collins....................  ........  X         ..........  Mr. Hoeffel.......  X
Mr. Wamp.......................  ........  ........  ..........  Ms. Baldwin.......  .......
Mr. Green......................  ........  X
Mr. Fletcher...................  ........  X
Mr. Miller of California.......  ........  X
Mr. Ryan.......................  ........  X
Mr. Toomey.....................  ........  X
----------------------------------------------------------------------------------------------------------------

    9. Mrs. Clayton offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment removes 
farm price support programs and the Federal Crop Insurance 
Program and the non insured crop disaster assistance program 
from the programs subject to sequestration.
    The amendment was not agreed to by a rollcall vote of 13 
ayes and 18 noes.

----------------------------------------------------------------------------------------------------------------
                                    Aye       No       Present                         Aye       No     Present
----------------------------------------------------------------------------------------------------------------
Mr. Kasich, Chairman...........  ........  X         ..........  Mr. Spratt,         X
                                                                  Ranking.
Mr. Chambliss..................  ........  ........  ..........  Mr. McDermott.....  X
Mr. Shays......................  ........  X         ..........  Ms. Rivers........  X
Mr. Herger.....................  ........  ........  ..........  Mr. Thompson......  .......
Mr. Franks.....................  ........  X         ..........  Mr. Minge.........  .......
Mr. Smith of Michigan..........  ........  X         ..........  Mr. Bentsen.......  X
Mr. Nussle.....................  ........  X         ..........  Mr. Davis.........  .......
Mr. Hoekstra...................  ........  ........  ..........  Mr. Weygand.......  .......
Mr. Radanovich.................  ........  ........  ..........  Mrs. Clayton......  X
Mr. Bass.......................  ........  X         ..........  Mr. Price.........  X
Mr. Gutknecht..................  ........  X         ..........  Mr. Markey........  .......
Mr. Hilleary...................  ........  X         ..........  Mr. Kleczka.......  X
Mr. Sununu.....................  ........  X         ..........  Mr. Clement.......  X
Mr. Pitts......................  ........  X         ..........  Mr. Moran.........  X
Mr. Knollenberg................  ........  X         ..........  Ms. Hooley........  X
Mr. Thornberry.................  ........  ........  ..........  Mr. Lucas.........  X
Mr. Ryun.......................  ........  X         ..........  Mr. Holt..........  X
Mr. Collins....................  ........  X         ..........  Mr. Hoeffel.......  X
Mr. Wamp.......................  ........  ........  ..........  Ms. Baldwin.......  .......
Mr. Green......................  ........  X
Mr. Fletcher...................  ........  X
Mr. Miller of California.......  ........  X
Mr. Ryan.......................  ........  X
Mr. Toomey.....................  ........  X
----------------------------------------------------------------------------------------------------------------

    10. Mr. Hoeffel offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment exempts 
Medicare from the programs subject to sequestration.
    The amendment was not agreed to by a rollcall vote of 12 
ayes and 19 noes.

----------------------------------------------------------------------------------------------------------------
                                    Aye       No       Present                         Aye       No     Present
----------------------------------------------------------------------------------------------------------------
Mr. Kasich, Chairman...........  ........  X         ..........  Mr. Spratt,         X
                                                                  Ranking.
Mr. Chambliss..................  ........  X         ..........  Mr. McDermott.....  X
Mr. Shays......................  ........  X         ..........  Ms. Rivers........  X
Mr. Herger.....................  ........  ........  ..........  Mr. Thompson......  .......
Mr. Franks.....................  ........  X         ..........  Mr. Minge.........  .......  X
Mr. Smith of Michigan..........  ........  ........  ..........  Mr. Bentsen.......  X
Mr. Nussle.....................  ........  X         ..........  Mr. Davis.........  .......
Mr. Hoekstra...................  ........  ........  ..........  Mr. Weygand.......  X
Mr. Radanovich.................  ........  ........  ..........  Mrs. Clayton......  .......
Mr. Bass.......................  ........  X         ..........  Mr. Price.........  X
Mr. Gutknecht..................  ........  X         ..........  Mr. Markey........  .......
Mr. Hilleary...................  ........  X         ..........  Mr. Kleczka.......  X
Mr. Sununu.....................  ........  X         ..........  Mr. Clement.......  X
Mr. Pitts......................  ........  X         ..........  Mr. Moran.........  .......
Mr. Knollenberg................  ........  X         ..........  Ms. Hooley........  X
Mr. Thornberry.................  ........  ........  ..........  Mr. Lucas.........  X
Mr. Ryun.......................  ........  X         ..........  Mr. Holt..........  X
Mr. Collins....................  ........  X         ..........  Mr. Hoeffel.......  X
Mr. Wamp.......................  ........  ........  ..........  Ms. Baldwin.......  .......
Mr. Green......................  ........  X
Mr. Fletcher...................  ........  X
Mr. Miller of California.......  ........  X
Mr. Ryan.......................  ........  X
Mr. Toomey.....................  ........  X
----------------------------------------------------------------------------------------------------------------

    11. Mr. Clement offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment exempts 
Veteran's Education programs from those programs subject to 
sequestration.
    The amendment was not agreed to on a rollcall vote with 13 
ayes and 17 noes.

----------------------------------------------------------------------------------------------------------------
                                    Aye       No       Present                         Aye       No     Present
----------------------------------------------------------------------------------------------------------------
Mr. Kasich, Chairman...........  ........  X         ..........  Mr. Spratt,         X
                                                                  Ranking.
Mr. Chambliss..................  ........  X         ..........  Mr. McDermott.....  X
Mr. Shays......................  ........  X         ..........  Ms. Rivers........  X
Mr. Herger.....................  ........  ........  ..........  Mr. Thompson......  .......
Mr. Franks.....................  ........  X         ..........  Mr. Minge.........  .......  X
Mr. Smith of Michigan..........  ........  ........  ..........  Mr. Bentsen.......  X
Mr. Nussle.....................  ........  X         ..........  Mr. Davis.........  X
Mr. Hoekstra...................  ........  ........  ..........  Mr. Weygand.......  X
Mr. Radanovich.................  ........  ........  ..........  Mrs. Clayton......  .......
Mr. Bass.......................  ........  X         ..........  Mr. Price.........  X
Mr. Gutknecht..................  ........  ........  ..........  Mr. Markey........  .......
Mr. Hilleary...................  ........  X         ..........  Mr. Kleczka.......  X
Mr. Sununu.....................  ........  X         ..........  Mr. Clement.......  X
Mr. Pitts......................  ........  X         ..........  Mr. Moran.........  .......
Mr. Knollenberg................  ........  X         ..........  Ms. Hooley........  X
Mr. Thornberry.................  ........  ........  ..........  Mr. Lucas.........  X
Mr. Ryun.......................  ........  X         ..........  Mr. Holt..........  X
Mr. Collins....................  ........  X         ..........  Mr. Hoeffel.......  X
Mr. Wamp.......................  ........  ........  ..........  Ms. Baldwin.......  .......
Mr. Green......................  ........  X
Mr. Fletcher...................  ........  X
Mr. Miller of California.......  ........  X
Mr. Ryan.......................  ........
Mr. Toomey.....................  ........  X
----------------------------------------------------------------------------------------------------------------

    12. Mr. Holt offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment exempts 
student loans from those programs subject to sequestration.
    The amendment was not agreed to by a roll call vote of 12 
ayes and 19 noes.

----------------------------------------------------------------------------------------------------------------
                                    Aye       No       Present                         Aye       No     Present
----------------------------------------------------------------------------------------------------------------
Mr. Kasich, Chairman...........  ........  X         ..........  Mr. Spratt,         .......
                                                                  Ranking.
Mr. Chambliss..................  ........  X         ..........  Mr. McDermott.....  X
Mr. Shays......................  ........  X         ..........  Ms. Rivers........  X
Mr. Herger.....................  ........  ........  ..........  Mr. Thompson......  .......
Mr. Franks.....................  ........  X         ..........  Mr. Minge.........  .......  X
Mr. Smith of Michigan..........  ........  X         ..........  Mr. Bentsen.......  X
Mr. Nussle.....................  ........  X         ..........  Mr. Davis.........  X
Mr. Hoekstra...................  ........  ........  ..........  Mr. Weygand.......  X
Mr. Radanovich.................  ........  ........  ..........  Mrs. Clayton......  .......
Mr. Bass.......................  ........  X         ..........  Mr. Price.........  X
Mr. Gutknecht..................  ........  ........  ..........  Mr. Markey........  .......
Mr. Hilleary...................  ........  X         ..........  Mr. Kleczka.......  X
Mr. Sununu.....................  ........  X         ..........  Mr. Clement.......  X
Mr. Pitts......................  ........  X         ..........  Mr. Moran.........  .......
Mr. Knollenberg................  ........  X         ..........  Ms. Hooley........  X
Mr. Thornberry.................  ........  ........  ..........  Mr. Lucas.........  X
Mr. Ryun.......................  ........  X         ..........  Mr. Holt..........  X
Mr. Collins....................  ........  X         ..........  Mr. Hoeffel.......  X
Mr. Wamp.......................  ........  ........  ..........  Ms. Baldwin.......  .......
Mr. Green......................  ........  X
Mr. Fletcher...................  ........  X
Mr. Miller of California.......  ........  X
Mr. Ryan.......................  ........  X
Mr. Toomey.....................  ........  X
----------------------------------------------------------------------------------------------------------------

    13. Mr. Bentsen offered a perfecting amendment to the 
amendment in the nature of a substitute. The amendment provides 
that not more than 80 percent of the on-budget surplus could go 
toward tax reductions or spending increases.
    The amendment was not agreed to by voice vote.
    14. Mr. Spratt offered a perfecting amendment to the 
amendment in the nature of a substitute. This omnibus amendment 
maintains the functional categories as legislative language, 
maintains the reconciliation directives as legislative 
language; allows appropriation bills to move if a budget 
resolution is not agreed to by May 15 of a fiscal year; strikes 
the lock-box provision; and maintains current practice 
regarding baselines.
    The amendment was not agreed to by a show of hands with 10 
ayes and 20 noes.
    15. Mr. Chambliss made a motion that the committee adopt 
the amendment in the nature of a substitute as the 
Comprehensive Budget Process Reform Act of 1999.
    The motion was agreed to by voice vote.
    16. Mr. Chambliss made a motion that the committee agree to 
H.R. 853, the Comprehensive Budget Process Reform Act of 1999 
as amended.
    The motion was agreed to by voice vote.
    17. Mr. Chambliss made a motion that the committee report 
the bill as amended and that the bill do pass.
    The motion was agreed to by a roll call vote of 22 ayes and 
12 noes.

----------------------------------------------------------------------------------------------------------------
                                    Aye       No       Present                         Aye       No     Present
----------------------------------------------------------------------------------------------------------------
Mr. Kasich, Chairman...........  X         ........  ..........  Mr. Spratt,         .......  X
                                                                  Ranking.
Mr. Chambliss..................  X         ........  ..........  Mr. McDermott.....  .......  X
Mr. Shays......................  ........  ........  ..........  Ms. Rivers........  .......
Mr. Herger.....................  X         ........  ..........  Mr. Thompson......  .......  X
Mr. Franks.....................  X         ........  ..........  Mr. Minge.........  X
Mr. Smith of Michigan..........  X         ........  ..........  Mr. Bentsen.......  .......  X
Mr. Nussle.....................  X         ........  ..........  Mr. Davis.........  .......
Mr. Hoekstra...................  X         ........  ..........  Mr. Weygand.......  .......  X
Mr. Radanovich.................  ........  ........  ..........  Mrs. Clayton......  .......
Mr. Bass.......................  X         ........  ..........  Mr. Price.........  .......  X
Mr. Gutknecht..................  X         ........  ..........  Mr. Markey........  .......
Mr. Hilleary...................  X         ........  ..........  Mr. Kleczka.......  .......  X
Mr. Sununu.....................  X         ........  ..........  Mr. Clement.......  .......  X
Mr. Pitts......................  X         ........  ..........  Mr. Moran.........  .......
Mr. Knollenberg................  X         ........  ..........  Ms. Hooley........  .......  X
Mr. Thornberry.................  ........  ........  ..........  Mr. Lucas.........  .......  X
Mr. Ryun.......................  X         ........  ..........  Mr. Holt..........  .......  X
Mr. Collins....................  X         ........  ..........  Mr. Hoeffel.......  .......  X
Mr. Wamp.......................  X         ........  ..........  Ms. Baldwin.......  .......
Mr. Green......................  X
Mr. Fletcher...................  X
Mr. Miller of California.......  X
Mr. Ryan.......................  X
Mr. Toomey.....................  X
----------------------------------------------------------------------------------------------------------------

    18. Mr. Chambliss asked for and received unanimous consent 
that the staff be given authority to make necessary technical 
and conforming changes in the bill and any committee 
amendments.
    19. The motion to reconsider was laid on the table by 
unanimous consent.

                  BUDGET COMMITTEE OVERSIGHT FINDINGS

    Clause 3(c)(1) of rule XIII requires each committee report 
to contain oversight findings and recommendations required 
pursuant to clause 2(b)(1) of rule X. The Committee on the 
Budget's oversight findings and recommendations are reflected 
in the body of this report.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Article I, Section 8 of the Constitution of the United 
States grants Congress the authority to enact this bill.

 OVERSIGHT FINDINGS AND RECOMMENDATIONS OF THE COMMITTEE ON GOVERNMENT 
                                 REFORM

    Clause 3(c)(4) of rule XIII requires each committee report 
to contain a summary of oversight findings and recommendations 
made by the Committee on Government Reform pursuant to clause 
4(c)(2) of rule X, whenever such findings have been timely 
submitted. The Committee on the Budget has received no such 
findings or recommendations from the Committee on Government 
Reform.

                  MISCELLANEOUS BUDGETARY INFORMATION

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives provides that Committee reports shall contain 
the statement required by Section 308(a)(1) of the 
Congressional Budget Act of 1974. This report does not contain 
such a statement because this bill does not actually provide 
new budget authority or new entitlement authority or change 
revenues.

                           COMMITTEE ESTIMATE

    Clause 3(d)(2) of rule XIII of the Rules of the House of 
Representatives requires the Committee to include both an 
estimate of the costs which would be incurred in carrying out 
this bill and a comparison of that estimate with any estimate 
made by a government agency of such costs. However, under 
clause 3(d)(3)(B) of that rule provides that this requirement 
does not apply when the Committee has included in its report a 
timely submitted cost estimate of the bill prepared by the 
Director of the Congressional Budget Office under section 402 
of the Congressional Budget Act of 1974.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives and Section 402 of the Congressional 
Budget Act of 1974, the Committee has received the following 
cost estimate for this bill from the Director of the 
Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 23, 1999.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 853, the 
Comprehensive Budget Process Reform Act of 1999.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                          Dan L. Crippen, Director.

                                Summary

    H.R. 853 would make a number of changes to the process used 
to develop, analyze, and control the federal budget. Only one 
provision of the bill--the automatic continuing resolution--
would affect direct spending. CBO estimates that the 
administrative costs of implementing the proposed changes in 
the budget process would largely affect discretionary programs 
and would total about $2 million annually, assuming 
appropriation of the necessary amounts. The budgetary 
procedures established by the bill could further alter 
budgetary outcomes, but any additional changes in spending or 
receipts would depend on future legislation.
    To avoid future government shutdowns, the bill would put in 
place an automatic continuing resolution beginning in fiscal 
year 2000 that would take effect if the Congress and the 
President fail to agree on regular or temporary appropriation 
bills by October 1 of each fiscal year. The appropriation for 
each project or activity would be the lower of the previous 
year's appropriated level or the annualized level provided in 
the most recent continuing resolution if the regular bill for 
that year did not become law. By providing an automatic funding 
source for 2000 that would take effect without further 
legislative action, H.R. 853 would provide direct spending 
authority, and pay-as-you-go procedures would apply to the 
bill. CBO estimates that enacting H.R. 853 would provide budget 
authority of about $566 billion in 2000, resulting in outlays 
of $338 billion in 2000 and $571 billion over the 2000-2004 
period. By itself, the bill would not provide any new funding 
for 2001 or beyond.
    H.R. 853 contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA) and would impose no 
costs on the budgets of state, local, or tribal governments.

               Description of the Bill's Major Provisions

    H.R. 853 would change the budget process by:

- Converting the budget resolution into a measure that would 
    become law;

- Creating a reserve fund for emergency spending and 
    establishing procedures for emergency spending in excess of 
    amounts in the reserve fund;

- Establishing new requirements for the review and 
    reauthorization of federal programs;

- Shifting the budgeting for federal insurance programs from a 
    cash to an accrual basis;

- Providing for automatic continuing appropriations;

- Modifying pay-as-you-go rules to permit a tax cut or new 
    direct spending up to the level of projected on-budget 
    surpluses;

- Establishing a lock-box that would allow reductions in total 
    discretionary spending if an individual appropriation bill 
    is amended to reduce spending; and

- Requiring additional reporting on long-term budgetary trends.

                Estimated Cost to the Federal Government

    The estimated budgetary impact of H.R. 853 is shown in the 
following table. For the purposes of this estimate, CBO assumes 
the bill will be enacted by the end of fiscal year 1999. The 
costs of this legislation fall within multiple budget 
functions.

                                    [By Fiscal year, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                       2000     2001     2002     2003     2004
----------------------------------------------------------------------------------------------------------------
Changes in direct spending:
    Estimated budget authority.....................................     $566       $0       $0       $0       $0
    Estimated outlays\1\...........................................      338      131       60       30       12
Changes in spending subject to appropriation:
    Authorization level:
        Specified..................................................        1        1        1        1        1
        Estimated..................................................        1        1        1        1        1
                                                                    --------------------------------------------
          Total....................................................        2        2        2        2        2
Estimated outlays..................................................        1        2        2        2        2
----------------------------------------------------------------------------------------------------------------
\1\ Outlays include amounts for transportation programs that are controlled by annual obligation limitations set
  in appropriation acts. Such limitations are not considered budget authority.

                           Basis of Estimate


                            Direct spending

    H.R. 853 would provide funding for fiscal year 2000 for 
projects and activities funded in 1999 appropriation acts. The 
appropriation provided for each project or activity would be 
the amount sufficient to continue funding for that project and 
activity at the level of operations provided in 1999 
appropriation acts. Upon enactment of an applicable regular 
appropriation bill or a continuing resolution for 2000, the 
appropriation for a project or activity provided by H.R. 853 
would no longer be available.
    Because scorekeeping guidelines adopted by the Congress and 
the Administration require that estimates of a bill not take 
into account possible future legislation, and no regular 
appropriation bills or continuing resolution for 2000 have been 
enacted, CBO estimates the effect that H.R. 853 would have if 
no appropriation bills providing funding for 2000 are enacted. 
In addition, though H.R. 853 would provide funding for 
discretionary programs, budget authority provided by law other 
than appropriation acts is defined as direct spending for 
purposes of budget enforcement. (If the same provisions were 
enacted in an appropriation bill, the resulting spending would 
be considered discretionary.)
    CBO estimates that continuing projects and activities 
funded in 1999 appropriations acts would require new budget 
authority of about $566 billion in 2000. (This figure does not 
include almost $10 billion already enacted as advance 
appropriations for 2000.) CBO estimates that the new budget 
authority for 2000 would result in outlays of $338 billion in 
2000 and about $571 billion over the 2000-2004 period.
    H.R. 853 also would establish an automatic continuing 
resolution at the previous year's level in the absence of 
regular appropriations for a given year. Because the 
appropriations for 2001 (and beyond) provided by H.R. 853 are 
contingent on future appropriation bills, H.R. 853 by itself 
would not provide any new funding for 2001 or any subsequent 
years. Under the provisions of H.R. 853, however, enactment of 
an appropriation bill for a given year would trigger 
appropriations for the following year to continue the projects 
and activities funded for the preceding fiscal year in the 
appropriation acts.

                   Spending subject to appropriation

    Title V would change the budgetary treatment of federal 
insurance from a cash to an accrual basis. To allow the Office 
of Management and Budget (OMB), CBO, and the various agencies 
with operating responsibilities for insurance programs 
sufficient time to develop, test, and revise the models needed 
to implement the change, the bill would provide a lengthy 
transition, delaying full implementation until fiscal year 
2006. H.R. 853 would authorize the appropriation of $600,000 
for each fiscal year 2000 through 2005 for OMB and the 11 
agencies responsible for administering the insurance programs 
affected by title V.
    In addition, the bill would impose other new requirements 
on OMB and on Congressional staff, including the General 
Accounting Office, CBO, the budget committees, and the 
appropriations committees. CBO estimates these costs would 
total about $1 million annually, assuming appropriation of the 
necessary amounts.

                      Pay-As-You-Go Considerations

    The Balanced Budget and Emergency Deficit Control Act sets 
up pay-as-you-go procedures for legislation affecting direct 
spending or receipts. The net changes in outlays that are 
subject to pay-as-you-go procedures are shown in the following 
table. The bill would not affect governmental receipts.

                                    [By Fiscal year, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                              1999     2000     2001     2002     2003     2004
----------------------------------------------------------------------------------------------------------------
Changes in outlay.........................................       $0     $338     $131      $60      $30      $12
Changes in receipts.......................................       NA       NA       NA       NA       NA       NA
----------------------------------------------------------------------------------------------------------------

              Intergovernmental and Private-Sector Impact

    H.R. 853 contains no intergovernmental mandates as defined 
in UMRA and would impose no costs on the budgets of state, 
local, or tribal governments.
    Estimate prepared by: Mary B. Maginniss, James R. Horney, 
and Priscilla M. Aycock.
    Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

               CHANGES IN EXISTING LAW MADE BY THE BILL,
                              AS REPORTED

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, existing law in which no change 
is proposed is shown in roman):

        CONGRESSIONAL BUDGET AND IMPOUNDMENT CONTROL ACT OF 1974

                    short titles; table of contents

    Section 1. (a) Short Titles.--This Act may be cited as the 
``Congressional Budget and Impoundment Control Act of 1974''. 
Titles I through IX may be cited as the ``Congressional Budget 
Act of 1974''. Parts A and B of title X may be cited as the 
``Impoundment Control Act of 1974''. Part C of title X may be 
cited as the ``Line Item Veto Act of 1996''.
    (b) Table of Contents.--

Sec. 1. Short titles; table of contents.
     * * * * * * *

                 TITLE III--CONGRESSIONAL BUDGET PROCESS

Sec. 300. Timetable.
Sec. 301. Annual [adoption of concurrent resolution] joint resolutions 
          on the budget.
Sec. 302. Committee allocations.
[Sec. 303. Concurrent resolution on the budget must be adopted before 
          budget-related legislation is considered.]
Sec. 303. Consideration of budget-related legislation before budget 
          becomes law.
Sec. 304. Permissible revisions of [concurrent] budget resolutions [on 
          the budget].
Sec. 305. Procedures relating to consideration of [concurrent] joint 
          resolutions on the budget.
     * * * * * * *
Sec. 316. Expedited procedures upon veto of joint resolution on the 
          budget.
Sec. 317. Emergencies.
Sec. 318. Spending accountability lock-box ledger.

      TITLE IV--ADDITIONAL PROVISIONS TO IMPROVE FISCAL PROCEDURES

                       Part A--General Provisions

[Sec. 401. Budget-related legislation not subject to appropriations.]
Sec. 401. Fixed-year authorizations required for direct spending.
     * * * * * * *

       TITLE VI--BUDGETARY TREATMENT OF FEDERAL INSURANCE PROGRAMS

Sec. 601. Short title.
Sec. 602. Budgetary treatment.
Sec. 603. Timetable for implementation of accrual budgeting for Federal 
          insurance programs.
Sec. 604. Definitions.
Sec. 605. Authorizations to enter into contracts; actuarial cost 
          account.
Sec.  606. Effective date.

           *       *       *       *       *       *       *


                        declaration of purposes

    Sec. 2. The Congress declares that it is essential--
            [(1) to assure effective congressional control over 
        the budgetary process;
            [(2) to provide for the congressional determination 
        each year of the appropriate level of Federal revenues 
        and expenditures; ]
            (1) to assure effective control over the budgetary 
        process;
            (2) to facilitate the determination each year of 
        the appropriate level of Federal revenues and 
        expenditures by the Congress and the President;

           *       *       *       *       *       *       *


                              definitions

    Sec. 3. In General.--For purposes of this Act--
            (1) * * *

           *       *       *       *       *       *       *

            (4) The term ``[concurrent] joint resolution on the 
        budget'' means--
                    (A) a [concurrent] joint resolution setting 
                forth the congressional budget for the United 
                States Government for a fiscal year as provided 
                in section 301; and
                    (B) any other [concurrent] joint resolution 
                revising the congressional budget for the 
                United States Government for a fiscal year as 
                described in section 304.

           *       *       *       *       *       *       *

            (11) The term ``direct spending'' has the meaning 
        given to such term in section 250(c)(8) of the Balanced 
        Budget and Emergency Deficit Control Act of 1985.
            (12)(A) The term ``emergency'' means a situation 
        that--
                    (i) requires new budget authority and 
                outlays (or new budget authority and the 
                outlays flowing therefrom) for the prevention 
                or mitigation of, or response to, loss of life 
                or property, or a threat to national security; 
                and
                    (ii) is unanticipated.
            (B) As used in subparagraph (A), the term 
        ``unanticipated'' means that the situation is--
                    (i) sudden, which means quickly coming into 
                being or not building up over time;
                    (ii) urgent, which means a pressing and 
                compelling need requiring immediate action;
                    (iii) unforeseen, which means not predicted 
                or anticipated as an emerging need; and
                    (iv) temporary, which means not of a 
                permanent duration.

                 TITLE II--CONGRESSIONAL BUDGET OFFICE

           *       *       *       *       *       *       *


                          duties and functions

    Sec. 202. (a) * * *

           *       *       *       *       *       *       *

    (e) Reports to Budget Committees.--
            (1) On or before February 15 of each year, the 
        Director shall submit to the Committees on the Budget 
        of the House of Representatives and the Senate, a 
        report for the fiscal year commencing on October 1 of 
        that year, with respect to fiscal policy, including (A) 
        alternative levels of total revenues, total new budget 
        authority, and total outlays (including related 
        surpluses and deficits) compared to comparable levels 
        for the current year, (B) the levels of tax 
        expenditures under existing law, taking into account 
        projected economic factors and any changes in such 
        levels based on proposals in the budget submitted by 
        the President for such fiscal year compared to 
        comparable levels for the current year, and (C) a 
        statement of the levels of budget authority and outlays 
        for each program assumed to be extended in the 
        baseline, as provided in section 257(b)(2)(A) and for 
        excise taxes assumed to be extended under section 
        257(b)(2)(C) of the Balanced Budget and Emergency 
        Deficit Control Act of 1985. Such report shall also 
        include a table on sources of spending growth in total 
        direct spending for the budget year and the ensuing 4 
        fiscal years, which shall include changes in outlays 
        attributable to the following: cost-of-living 
        adjustments; changes in the number of program 
        recipients; increases in medical care prices, 
        utilization and intensity of medical care; and residual 
        factors. Such report shall also include a discussion of 
        national budget priorities, including alternative ways 
        of allocating new budget authority and budget outlays 
        for such fiscal year among major programs or functional 
        categories, taking into account how such alternative 
        allocations will meet major national needs and affect 
        balanced growth and development of the United States. 
        Such report shall also include an analysis based upon 
        current law for every fifth year of the period of 75 
        fiscal years beginning with such fiscal year, of the 
        estimated levels of total new budget authority and 
        total budget outlays, estimated revenues, estimated 
        surpluses and deficits, and, for social security, 
        medicare, medicaid, and all other direct spending, 
        estimated levels of total new budget authority and 
        total budget outlays. The report described in the 
        preceding sentence shall also specify its underlying 
        assumptions and set forth a sensitivity analysis of 
        factors that have a significant effect on the 
        projections made in the report.

           *       *       *       *       *       *       *


                TITLE III--CONGRESSIONAL BUDGET PROCESS

                               timetable

    [Sec. 300. The timetable with respect to the congressional 
budget process for any fiscal year is as follows:

[On or before:      Action to be completed:
  First Monday in   President submits his budget........................
   February
  February 15.......Congressional Budget Office submits report to Budget 
                    Committees.
  Not later than 6  Committees submit views and estimates to Budget ....
   weeks after      Committees.
   President submits
   budget.
  April 1...........Senate Budget Committee reports concurrent .........
                    resolution on the budget.
  April 15..........Congress completes action on concurrent resolution .
                    on the budget.
  May 15............Annual appropriation bills may be considered in the 
                    House.
  June 10...........House Appropriations Committee reports last annual .
                    appropriation bill.
  June 15...........Congress completes action on reconciliation ........
                    legislation.
  June 30...........House completes action on annual appropriation .....
                    bills.
  October 1.........Fiscal year begins.]................................


                               timetable


    Sec. 300. The timetable with respect to the congressional 
budget process for any fiscal year is as follows:

On or before:       Action to be completed:
  First Monday in   President submits his budget........................
   February
  February 15.......Congressional Budget Office submits report to Budget 
                    Committees.
  Not later than 6 Committees submit views and estimates to Budget ....
   weeks after      Committees.
   President submits
   budget.
  April 1...........Senate Budget Committee reports joint resolution on 
                    the budget.
  April 15..........Congress completes action on joint resolution on the 
                    budget.
  June 10...........House Appropriations Committee reports last annual .
                    appropriation bill.
  June 15...........Congress completes action on reconciliation ........
                    legislation.
  June 30...........House completes action on annual appropriation .....
                    bills.
  October 1.........Fiscal year begins..................................

  annual [adoption of concurrent resolution] joint resolutions on the 
                                 budget

    Sec. 301. (a) Content of [Concurrent] Joint  Resolution on 
the Budget.--On or before April 15 of each year, the Congress 
shall complete action on a [concurrent] joint resolution on the 
budget for the fiscal year beginning on October 1 of such year. 
The [concurrent] joint resolution shall set forth appropriate 
levels for the fiscal year beginning on October 1 of such year 
and for at least each of the 4 ensuing fiscal years for the 
following--
            (1) totals of new budget authority and outlays;
            (2) total Federal revenues and the amount, if any, 
        by which the aggregate level of Federal revenues should 
        be increased or decreased by bills and resolutions to 
        be reported by the appropriate committees;
            (3) the surplus or deficit in the budget;
            [(4) new budget authority and outlays for each 
        major functional category, based on allocations of the 
        total levels set forth pursuant to paragraph (1);]
            (4) subtotals of new budget authority and outlays 
        for nondefense discretionary spending, defense 
        discretionary spending, direct spending (excluding 
        interest), and interest; and for fiscal years to which 
        the amendments made by title II of the Comprehensive 
        Budget Process Reform Act of 1999 apply, subtotals of 
        new budget authority and outlays for emergencies;

           *       *       *       *       *       *       *

            (7) For purposes of Senate enforcement under this 
        title, revenues of the old-age, survivors, and 
        disability insurance program established under title II 
        of the Social Security Act (and the related provisions 
        of the Internal Revenue Code of 1986) for the fiscal 
        year of the resolution and for each of the 4 succeeding 
        fiscal years.
The [concurrent] joint resolution shall not include the outlays 
and revenue totals of the old age, survivors, and disability 
insurance program established under title II of the Social 
Security Act or the related provisions of the Internal Revenue 
Code of 1986 in the surplus or deficit totals required by this 
subsection or in any other surplus or deficit totals required 
by this title.
    (b) Additional Matters in [Concurrent] Joint Resolution.--
The concurrent resolution on the budget may--
            (1) set forth, if required by subsection (f), the 
        calendar year in which, in the opinion of the Congress, 
        the goals for reducing unemployment set forth in 
        section 4(b) of the Employment Act of 1946 should be 
        achieved;
            [(2) include reconciliation directives described in 
        section 310;]
            (2) if submitted by the Committee on Ways and Means 
        of the House of Representatives or the Committee on 
        Finance of the Senate to the Committee on the Budget of 
        that House of Congress, amend section 3101 of title 31, 
        United States Code, to change the statutory limit on 
        the public debt;
            (3) require a procedure under which all or certain 
        bills or resolutions providing new budget authority or 
        new entitlement authority for such fiscal year shall 
        not be enrolled until the Congress has completed action 
        on any reconciliation bill or reconciliation resolution 
        or both required by such [concurrent] joint resolution 
        to be reported in accordance with section 310(b);
            [(4) set forth such other matters, and require such 
        other procedures, relating to the budget, as may be 
        appropriate to carry out the purposes of this Act;]
            (4) require such other congressional procedures, 
        relating to the budget, as may be appropriate to carry 
        out the purposes of this Act;
            (5) include a heading entitled ``Debt Increase as 
        Measure of Deficit'' in which the [concurrent] joint 
        resolution shall set forth the amounts by which the 
        debt subject to limit (in section 3101 of title 31 of 
        the United States Code) has increased or would increase 
        in each of the relevant fiscal years;
            [(6) include a heading entitled ``Display of 
        Federal Retirement Trust Fund Balances'' in which the 
        concurrent resolution shall set forth the balances of 
        the Federal retirement trust funds;]
            (6) set forth procedures in the Senate whereby 
        committee allocations, aggregates, and other levels can 
        be revised for legislation if that legislation would 
        not increase the deficit, or would not increase the 
        deficit when taken with other legislation enacted after 
        the adoption of the resolution, for the first fiscal 
        year or the total period of fiscal years covered by the 
        resolution.
    (c) Consideration of Procedures or Matters Which Have the 
Effect of Changing any Rule of the House of Representatives.--
If the Committee on the Budget of the House of Representatives 
reports any [concurrent] joint resolution on the budget which 
includes any procedure or matter which has the effect of 
changing any rule of the House of Representatives, such 
[concurrent] joint resolution shall then be referred to the 
Committee on Rules with instructions to report it within five 
calendar days (not counting any day on which the House is not 
in session). The Committee on Rules shall have jurisdiction to 
report any [concurrent] joint resolution referred to it under 
this paragraph with an amendment or amendments changing or 
striking out any such procedure or matter.

           *       *       *       *       *       *       *

    (e) Hearings and Report.--
            (1) In general.--In developing the [concurrent] 
        joint resolution on the budget referred to in 
        subsection (a) for each fiscal year, the Committee on 
        the Budget of each House shall hold hearings and shall 
        receive testimony from Members of Congress and such 
        appropriate representatives of Federal departments and 
        agencies, the general public, and national 
        organizations as the committee deems desirable. Each of 
        the recommendations as to short-term and medium-term 
        goal set forth in the report submitted by the members 
        of the Joint Economic Committee under subsection (d) 
        may be considered by the Committee on the Budget of 
        each House as part of its consideration of such 
        [concurrent] joint resolution, and its report may 
        reflect its views thereon, including its views on how 
        the estimates of revenues and levels of budget 
        authority and outlays set forth in such [concurrent] 
        joint resolution are designed to achieve any goals it 
        is recommending. The basis of deliberations in 
        developing such joint resolution shall be the estimated 
        budgetary levels for the preceding fiscal year. Any 
        budgetary levels pending before the committee and the 
        text of the joint resolution shall be accompanied by a 
        document comparing such levels or such text to the 
        estimated levels of the prior fiscal year. Any 
        amendment offered in the committee that changes a 
        budgetary level and is based upon a specific policy 
        assumption for a program, project, or activity shall be 
        accompanied by a document indicating the estimated 
        amount for such program, project, or activity in the 
        current year.
            (2) Required contents of report.--The report 
        accompanying the resolution shall include--
                    (A) new budget authority and outlays for 
                each major functional category, based on 
                allocations of the total levels set forth 
                pursuant to subsection (a)(1);
                    [(A)] (B) a comparison of the levels of 
                total new budget authority, total outlays, 
                total revenues, and the surplus or deficit for 
                each fiscal year set forth in the resolution 
                with those requested in the budget submitted by 
                the President;
                    [(B)] (C) with respect to each major 
                functional category, an estimate of total new 
                budget authority and total outlays, with the 
                estimates divided between discretionary and 
                [mandatory] direct spending amounts;
                    (D) a measure, as a percentage of gross 
                domestic product, of total outlays, total 
                Federal revenues, the surplus or deficit, and 
                new outlays for nondefense discretionary 
                spending, defense spending, and direct spending 
                as set forth in such resolution;
                    [(C)] (E) the economic assumptions that 
                underlie each of the matters set forth in the 
                resolution and any alternative economic 
                assumptions and objectives the committee 
                considered;
                    [(D)] (F) information, data, and 
                comparisons indicating the manner in which, and 
                the basis on which, the committee determined 
                each of the matters set forth in the 
                resolution;
                    (G) if the joint resolution on the budget 
                includes any allocation to a committee (other 
                than the Committee on Appropriations) of levels 
                in excess of current law levels, a 
                justification for not subjecting any program, 
                project, or activity (for which the allocation 
                is made) to annual discretionary 
                appropriations;
                    [(E)] (H) the estimated levels of tax 
                expenditures (the tax expenditures budget) by 
                major items and functional categories for the 
                President's budget and in the resolution; [and]
                    [(F)] (I) allocations described in section 
                302(a)[.]; and
                    (J) a comparison of levels for the current 
                fiscal year with proposed spending and revenue 
                levels for the subsequent fiscal years along 
                with the proposed increase or decrease of 
                spending in percentage terms for each function.
            (3) Additional contents of report.--The report 
        accompanying the resolution may include--
                    (A) reconciliation directives described in 
                section 310;
                    [(A)] (B) a statement of any significant 
                changes in the proposed levels of Federal 
                assistance to State and local governments;
                    [(B)] (C) an allocation of the level of 
                Federal revenues recommended in the resolution 
                among the major sources of such revenues;
                    [(C) information, data, and comparisons on 
                the share of total Federal budget outlays and 
                of gross domestic product devoted to investment 
                in the budget submitted by the President and in 
                the resolution;
                    [(D) the assumed levels of budget authority 
                and outlays for public buildings, with a 
                division between amounts for construction and 
                repair and for rental payments; and]
                    [(E)] (D) other matters, relating to the 
                budget and to fiscal policy, that the committee 
                deems appropriate.
    (f) Achievement of Goals for Reducing Unemployment.--
            (1) If, pursuant to section 4(c) of the Employment 
        Act of 1946, the President recommends in the Economic 
        Report that the goals for reducing unemployment set 
        forth in section 4(b) of such Act be achieved in a year 
        after the close of the five-year period prescribed by 
        such subsection, the [concurrent] joint resolution on 
        the budget for the fiscal year beginning after the date 
        on which such Economic Report is received by the 
        Congress may set forth the year in which, in the 
        opinion of the Congress, such goals can be achieved.
            (2) After the Congress has expressed its opinion 
        pursuant to paragraph (1) as to the year in which the 
        goals for reducing unemployment set forth in section 
        4(b) of the Employment Act of 1946 can be achieved, if, 
        pursuant to section 4(e) of such Act, the President 
        recommends in the Economic Report that such goals be 
        achieved in a year which is different from the year in 
        which the Congress has expressed its opinion that such 
        goals should be achieved, either in its action pursuant 
        to paragraph (1) or in its most recent action pursuant 
        to this paragraph, the [concurrent] joint resolution on 
        the budget for the fiscal year beginning after the date 
        on which such Economic Report is received by the 
        Congress may set forth the year in which, in the 
        opinion of the Congress, such goals can be achieved.

           *       *       *       *       *       *       *

    (g) Economic Assumptions.--
            (1) It shall not be in order in the Senate to 
        consider any [concurrent] joint resolution on the 
        budget for a fiscal year, or any amendment thereto, or 
        any conference report thereon, that sets forth amounts 
        and levels that are determined on the basis of more 
        than one set of economic and technical assumptions.
            (2) The joint explanatory statement accompanying a 
        conference report on a [concurrent] joint resolution on 
        the budget shall set forth the common economic 
        assumptions upon which such joint statement and 
        conference report are based, or upon which any 
        amendment contained in the joint explanatory statement 
        to be proposed by the conferees in the case of 
        technical disagreement, is based.
            (3) Subject to periodic reestimation based on 
        changed economic conditions or technical estimates, 
        determinations under titles III and IV of the 
        Congressional Budget Act of 1974 shall be based upon 
        such common economic and technical assumptions.

           *       *       *       *       *       *       *

    (i) Social Security Point of Order.--It shall not be in 
order in the Senate to consider any [concurrent] joint 
resolution on the budget (or amendment, motion, or conference 
report on the resolution) that would decrease the excess of 
social security revenues over social security outlays in any of 
the fiscal years covered by the [concurrent] joint resolution. 
No change in chapter 1 of the Internal Revenue Code of 1986 
shall be treated as affecting the amount of social security 
revenues unless such provision changes the income tax treatment 
of social security benefits.

                         committee allocations

    Sec. 302. (a) Committee Spending Allocations.--
            (1) Allocation among committees.--The joint 
        explanatory statement accompanying a conference report 
        on a [concurrent] joint resolution on the budget shall 
        include an allocation, consistent with the resolution 
        recommended in the conference report, of the levels for 
        the first fiscal year of the resolution, for at least 
        each of the ensuing 4 fiscal years, and a total for 
        that period of fiscal years (except in the case of the 
        Committee on Appropriations only for the fiscal year of 
        that resolution) of--
                    (A) * * *

           *       *       *       *       *       *       *

            [(5) Adjusting allocation of discretionary spending 
        in the house of representatives.--(A) If a concurrent 
        resolution on the budget is not adopted by April 15, 
        the chairman of the Committee on the Budget of the 
        House of Representatives shall submit to the House, as 
        soon as practicable, an allocation under paragraph (1) 
        to the Committee on Appropriations consistent with the 
        discretionary spending levels in the most recently 
        agreed to concurrent resolution on the budget for the 
        appropriate fiscal year covered by that resolution.
            [(B) As soon as practicable after an allocation 
        under paragraph (1) is submitted under this section, 
        the Committee on Appropriations shall make 
        suballocations and report those suballocations to the 
        House of Representatives.]
            (5) Justification of certain spending 
        allocations.--The joint explanatory statement 
        accompanying a conference report on a joint resolution 
        on the budget that includes any allocation to a 
        committee (other than the Committee on Appropriations) 
        of levels in excess of current law levels shall set 
        forth a justification for not subjecting any program, 
        project, or activity (for which the allocation is made) 
        to annual discretionary appropriation.
            (6) Adjustment of allocations.--Upon the 
        engrossment of Senate amendments to any appropriation 
        bill (as defined in section 318(d)) for a fiscal year, 
        the amounts allocated under paragraph (1) to the 
        Committee on Appropriations of each House upon the 
        adoption of the most recent joint resolution on the 
        budget for that fiscal year shall be adjusted downward 
        by the amounts credited to the applicable Joint House-
        Senate Lock-box Balance under section 318(c)(2). The 
        revised levels of new budget authority and outlays 
        shall be submitted to each House by the chairman of the 
        Committee on the Budget of that House and shall be 
        printed in the Congressional Record.
    (b) Suballocations by Appropriations Committees.--As soon 
as practicable after a [concurrent] joint resolution on the 
budget is [agreed to] enacted, the Committee on Appropriations 
of each House (after consulting with the Committee on 
Appropriations of the other House) shall suballocate each 
amount allocated to it for the budget year under subsection (a) 
among its subcommittees. Each Committee on Appropriations shall 
promptly report to its House suballocations made or revised 
under this subsection. The Committee on Appropriations of the 
House of Representatives shall further divide among its 
subcommittees the divisions made under subsection (a)(3)(B) and 
promptly report those divisions to the House. Whenever an 
adjustment is made under subsection (a)(6) to an allocation 
under that subsection, the Committee on Appropriations of each 
House shall make downward adjustments in the most recent 
suballocations of new budget authority and outlays under this 
subparagraph to the appropriate subcommittees of that committee 
in the total amounts of those adjustments under section 
318(c)(2). The revised suballocations shall be submitted to 
each House by the chairman of the Committee on Appropriations 
of that House and shall be printed in the Congressional Record.

           *       *       *       *       *       *       *

    (d) Subsequent [Concurrent[ Joint Resolutions.--In the case 
of a [concurrent] joint resolution on the budget referred to in 
section 304, the allocations under subsection (a) and the 
subdivisions under subsection (b) shall be required only to the 
extent necessary to take into account revisions made in the 
[most recently agreed to concurrent resolution on the budget] 
most recently enacted joint resolution on the budget or agreed 
to concurrent resolution on the budget (as applicable).

           *       *       *       *       *       *       *

    (f) Legislation Subject to Point of Order.--
            (1) * * *
            (2) In the senate.--After a [concurrent] joint 
        resolution on the budget is [agreed to] enacted, it 
        shall not be in order in the Senate to consider any 
        bill, joint resolution, amendment, motion, or 
        conference report that would cause--
                    (A) * * *

           *       *       *       *       *       *       *

    (g) Pay-as-You-Go Exception in the House.--
            (1) In general.--(A) Subsection (f)(1) [and, after 
        April 15, section 303(a)] shall not apply to any bill 
        or joint resolution, as reported, amendment thereto, or 
        conference report thereon if, for each fiscal year 
        covered by the [most recently agreed to concurrent 
        resolution on the budget] most recently enacted joint 
        resolution on the budget or agreed to concurrent 
        resolution on the budget (as applicable)--
                    (i) * * *

           *       *       *       *       *       *       *

        would not increase the deficit, and, if the sum of any 
        revenue increases provided in legislation already 
        enacted during the current session (when added to 
        revenue increases, if any, in excess of any outlay 
        increase provided by the legislation proposed for 
        consideration) is at least as great as the sum of the 
        amount, if any, by which the aggregate level of Federal 
        revenues should be increased as set forth in that 
        [concurrent] joint resolution and the amount, if any, 
        by which revenues are to be increased pursuant to pay-
        as-you-go procedures under section 301(b)(8), if 
        included in that [concurrent] joint resolution.
            (B) Section 311(a), as that section applies to 
        revenues, shall not apply to any bill, joint 
        resolution, amendment thereto, or conference report 
        thereon if, for each fiscal year covered by the most 
        recently [agreed to concurrent] enacted joint 
        resolution on the budget--
                    (i) * * *

           *       *       *       *       *       *       *

        would not increase the deficit, and, if the sum of any 
        outlay reductions provided in legislation already 
        enacted during the current session (when added to 
        outlay reductions, if any, in excess of any revenue 
        reduction provided by the legislation proposed for 
        consideration) is at least as great as the sum of the 
        amount, if any, by which the aggregate level of Federal 
        outlays should be reduced as required by that 
        [concurrent] joint resolution and the amount, if any, 
        by which outlays are to be reduced pursuant to pay-as-
        you-go procedures under section 301(b)(8), if included 
        in that [concurrent] joint resolution.
            (2) Revised allocations.--(A) * * *
            (B) Such revised allocations, functional levels, 
        and budget aggregates shall be considered for the 
        purposes of this Act as allocations, functional levels, 
        and budget aggregates contained in the [most recently 
        agreed to concurrent resolution on the budget] most 
        recently enacted joint resolution on the budget or 
        agreed to concurrent resolution on the budget (as 
        applicable).

   [concurrent joint resolution on the budget must be adopted before 
               budget-related legislation is considered]


 consideration of budget-related legislation before budget becomes law


    Sec. 303. (a) In General.--Until the [concurrent] joint 
resolution on the budget for a fiscal year has been [agreed to] 
enacted, it shall not be in order in the House of 
Representatives, with respect to the first fiscal year covered 
by that resolution, or the Senate, with respect to any fiscal 
year covered by that resolution, to consider any bill or joint 
resolution, amendment or motion thereto, or conference report 
thereon that--
            (1) * * *

           *       *       *       *       *       *       *

    (b) Exceptions in the House.-- In the House of 
Representatives, subsection (a) does not apply--
            (1)[(A)] to any bill or joint resolution, as 
        reported, providing advance discretionary new budget 
        authority that first becomes available for the first or 
        second fiscal year after the budget year; or
            [(B)] (2) to any bill or joint resolution, as 
        reported, first increasing or decreasing revenues in a 
        fiscal year following the fiscal year to which the 
        [concurrent] joint resolution applies[;].
            [(2) after May 15, to any general appropriation 
        bill or amendment thereto; or
            [(3) to any bill or joint resolution unless it is 
        reported by a committee.]
    (c) Application to Appropriation Measures in the Senate.--
            (1) In general.--Until the [concurrent] joint 
        resolution on the budget for a fiscal year has been 
        [agreed to] enacted and an allocation has been made to 
        the Committee on Appropriations of the Senate under 
        section 302(a) for that year, it shall not be in order 
        in the Senate to consider any appropriation bill or 
        joint resolution, amendment or motion thereto, or 
        conference report thereon for that year or any 
        subsequent year.

           *       *       *       *       *       *       *


     [permissible revisions of concurrent resolutions on the budget

    [Sec. 304. At any time after the concurrent resolution on 
the budget for a fiscal year has been agreed to pursuant to 
section 301, and before the end of such fiscal year, the two 
Houses may adopt a concurrent resolution on the budget which 
revises or reaffirms the concurrent resolution on the budget 
for such fiscal year most recently agreed to.]


              permissible revisions of budget resolutions


    Sec. 304. At any time after the joint resolution on the 
budget for a fiscal year has been enacted pursuant to section 
301, and before the end of such fiscal year, the two Houses and 
the President may enact a joint resolution on the budget which 
revises or reaffirms the joint resolution on the budget for 
such fiscal year most recently enacted. If a concurrent 
resolution on the budget has been agreed to pursuant to section 
316, then before the end of such fiscal year, the two Houses 
may adopt a concurrent resolution on the budget which revises 
or reaffirms the concurrent resolution on the budget for such 
fiscal year most recently agreed to.

 provisions relating to the consideration of concurrent resolutions on 
                               the budget

    Sec. 305. (a) Procedure in House of Representatives After 
Report of Committee; Debate.--
            (1) When a [concurrent] joint resolution on the 
        budget has been reported by the Committee on the Budget 
        of the House of Representatives and has been referred 
        to the appropriate calendar of the House, it shall be 
        in order on any day thereafter, subject to clause 
        2(l)(6) of rule XI of the Rules of the House of 
        Representatives, to move to proceed to the 
        consideration of the [concurrent] joint resolution. The 
        motion is highly privileged and is not debatable. An 
        amendment to the motion is not in order and it is not 
        in order to move to reconsider the vote by which the 
        motion is agreed to or disagreed to.
            (2) General debate on any [concurrent] joint 
        resolution on the budget in the House of 
        Representatives shall be limited to not more than 10 
        hours, which shall be divided equally between the 
        majority and minority parties, plus such additional 
        hours of debate as are consumed pursuant to paragraph 
        (3). A motion further to limit debate is not debatable. 
        A motion to recommit the [concurrent] joint resolution 
        is not in order, and it is not in order to move to 
        reconsider the vote by which the [concurrent] joint 
        resolution is agreed to or disagreed to.
            (3) Following the presentation of opening 
        statements on the [concurrent] joint resolution on the 
        budget for a fiscal year by the chairman and ranking 
        minority member of the Committee on the Budget of the 
        House, there shall be a period of up to four hours for 
        debate on economic goals and policies.
            (4) Only if a [concurrent] joint resolution on the 
        budget reported by the Committee on the Budget of the 
        House sets forth the economic goals (as described in 
        sections 3(a)(2) and (4)(b) of the Full Employment Act 
        of 1946) which the estimates, amounts, and levels (as 
        described in section 301(a)) set forth in such 
        resolution are designed to achieve, shall it be in 
        order to offer to such resolution an amendment relating 
        to such goals, and such amendment shall be in order 
        only if it also proposes to alter such estimates, 
        amounts, and levels in germane fashion in order to be 
        consistent with the goals proposed in such amendment.
            (5) Consideration of any [concurrent] joint 
        resolution on the budget by the House of 
        Representatives shall be in the Committee of the Whole, 
        and the resolution shall be considered for amendment 
        under the five-minute rule in accordance with the 
        applicable provisions of rule XXIII of the Rules of the 
        House of Representatives. After the Committee rises and 
        reports the resolution back to the House, the previous 
        question shall be considered as ordered on the 
        resolution and any amendments thereto to final passage 
        without intervening motion; except that it shall be in 
        order at any time prior to final passage 
        (notwithstanding any other rule or provision of law) to 
        adopt an amendment (or a series of amendments) changing 
        any figure or figures in the resolution as so reported 
        to the extent necessary to achieve mathematical 
        consistency.
            (6) Debate in the House of Representatives on the 
        conference report on any [concurrent] joint resolution 
        on the budget shall be limited to not more than 5 
        hours, which shall be divided equally between the 
        majority and minority parties. A motion further to 
        limit debate is not debatable. A motion to recommit the 
        conference report is not in order, and it is not in 
        order to move to reconsider the vote by which the 
        conference report is agreed to or disagreed to.
            (7) Appeals from decisions of the Chair relating to 
        the application of the Rules of the House of 
        Representatives to the procedure relating to any 
        [concurrent] joint resolution on the budget shall be 
        decided without debate.
    (b) Procedure in Senate After Report of Committee; Debate; 
Amendments.--
            (1) Debate in the Senate on any [concurrent] joint 
        resolution on the budget, and all amendments thereto 
        and debatable motions and appeals in connection 
        therewith, shall be limited to not more than 50 hours, 
        except that with respect to any [concurrent] joint 
        resolution referred to in section 304(a) all such 
        debate shall be limited to not more than 15 hours. The 
        time shall be equally divided between, and controlled 
        by, the majority leader and the minority leader or 
        their designees.
            (2) Debate in the Senate on any amendment to a 
        [concurrent] joint resolution on the budget shall be 
        limited to 2 hours, to be equally divided between, and 
        controlled by, the mover and the manager of the 
        [concurrent] joint resolution, and debate on any 
        amendment to an amendment, debatable motion, or appeal 
        shall be limited to 1 hour, to be equally divided 
        between, and controlled by, the mover and the manager 
        of the [concurrent] joint resolution, except that in 
        the event the manager of the [concurrent] joint 
        resolution is in favor of any such amendment, motion, 
        or appeal, the time in opposition thereto shall be 
        controlled by the minority leader or his designee. No 
        amendment that is not germane to the provisions of such 
        [concurrent] joint resolution shall be received. Such 
        leaders, or either of them, may, from the time under 
        their control on the passage of the [concurrent] joint 
        resolution, allot additional time to any Senator during 
        the consideration of any amendment, debatable motion, 
        or appeal.
            (3) Following the presentation of opening 
        statements on the [concurrent] joint resolution on the 
        budget for a fiscal year by the chairman and ranking 
        minority member of the Committee on the Budget of the 
        Senate, there shall be a period of up to four hours for 
        debate on economic goals and policies.
            (4) Subject to the other limitations of this Act, 
        only if a [concurrent] joint resolution on the budget 
        reported by the Committee on the Budget of the Senate 
        sets forth the economic goals (as described in sections 
        3(a)(2) and 4(b) of the Employment Act of 1946) which 
        the estimates, amounts, and levels (as described in 
        section 301(a)) set forth in such resolution are 
        designed to achieve, shall it be in order to offer to 
        such resolution an amendment relating to such goals, 
        and such amendment shall be in order only if it also 
        proposes to alter such estimates, amounts, and levels 
        in germane fashion in order to be consistent with the 
        goals proposed in such amendment.
            (5) A motion to further limit debate is not 
        debatable. A motion to recommit (except a motion to 
        recommit with instructions to report back within a 
        specified number of days, not to exceed 3, not counting 
        any day on which the Senate is not in session) is not 
        in order. Debate on any such motion to recommit shall 
        be limited to 1 hour, to be equally divided between, 
        and controlled by, the mover and the manager of the 
        [concurrent] joint resolution.
            (6) Notwithstanding any other rule, an amendment or 
        series of amendments to a [concurrent] joint resolution 
        on the budget proposed in the Senate shall always be in 
        order if such amendment or series of amendments 
        proposes to change any figure or figures then contained 
        in such [concurrent] joint resolution so as to make 
        such [concurrent] joint resolution mathematically 
        consistent or so as to maintain such consistency.
    (c) Action on Conference Reports in the Senate.--
            (1) A motion to proceed to the consideration of the 
        conference report on any [concurrent] joint resolution 
        on the budget (or a reconciliation bill or resolution) 
        may be made even though a previous motion to the same 
        effect has been disagreed to.
            (2) During the consideration in the Senate of the 
        conference report (or a message between Houses) on any 
        [concurrent] joint resolution on the budget, and all 
        amendments in disagreement, and all amendments thereto, 
        and debatable motions and appeals in connection 
        therewith, debate shall be limited to 10 hours, to be 
        equally divided between, and controlled by, the 
        majority leader and minority leader or their designees. 
        Debate on any debatable motion or appeal related to the 
        conference report (or a message between Houses) shall 
        be limited to 1 hour, to be equally divided between, 
        and controlled by, the mover and the manager of the 
        conference report (or a message between Houses).

           *       *       *       *       *       *       *

    (d) [Concurrent] Joint Resolution Must be Consistent in the 
Senate.--It shall not be in order in the Senate to vote on the 
question of agreeing to--
            (1) a [concurrent] joint resolution on the budget 
        unless the figures then contained in such resolution 
        are mathematically consistent; or
            (2) a conference report on a [concurrent] joint 
        resolution on the budget unless the figures contained 
        in such resolution, as recommended in such conference 
        report, are mathematically consistent.
    (e) Limitation on Contents.--(1) It shall not be in order 
in the House of Representatives or in the Senate to consider 
any joint resolution on the budget or any amendment thereto or 
conference report thereon that contains any matter referred to 
in paragraph (2).
    (2) Any joint resolution on the budget or any amendment 
thereto or conference report thereon that contains any matter 
not permitted in section 301(a) or (b) shall not be treated in 
the House of Representatives or the Senate as a budget 
resolution under subsection (a) or (b) or as a conference 
report on a budget resolution under subsection (c) of this 
section.
    (f) Point of Order Regarding Emergency Reserve Funds.--It 
shall not be in order in the House of Representatives or in the 
Senate to consider an amendment to a joint resolution on the 
budget which changes the amount of budget authority and outlays 
set forth in section 301(a)(4) for emergency reserve fund.

legislation dealing with congressional budget must be handled by budget 
                               committees

    Sec. 306. No bill, resolution, amendment, motion, or 
conference report, dealing with any matter which is within the 
jurisdiction of the Committee on the Budget of either House 
shall be considered in that House unless it is a bill or 
resolution which has been reported by the Committee on the 
Budget of that House (or from the consideration of which such 
committee has been discharged) or unless it is an amendment to 
such a bill or resolution. No amendment reported by the 
Committee on the Budget (or from the consideration of which 
such committee has been discharged) pursuant to section 317(c) 
may be amended.

           *       *       *       *       *       *       *


  reports, summaries, and projections of congressional budget actions

    Sec. 308. (a) Reports on Legislation Providing New Budget 
Authority or Providing an Increase or Decrease in Revenues or 
Tax Expenditures.--
            (1) Whenever a committee of either House reports to 
        its House a bill or joint resolution, or committee 
        amendment thereto, providing new budget authority 
        (other than continuing appropriations) or providing an 
        increase or decrease in revenues or tax expenditures 
        for a fiscal year (or fiscal years), the report 
        accompanying that bill or joint resolution shall 
        contain a statement, or the committee shall make 
        available such a statement in the case of an approved 
        committee amendment which is not reported to its House, 
        prepared after consultation with the Director of the 
        Congressional Budget Office--
                    (A) comparing the levels in such measure to 
                the appropriate allocations in the reports 
                submitted under section 302(b) for the [most 
                recently agreed to concurrent resolution on the 
                budget] most recently enacted joint resolution 
                on the budget or agreed to concurrent 
                resolution on the budget (as applicable) for 
                such fiscal year (or fiscal years);
                    (B) containing a projection by the 
                Congressional Budget Office of how such measure 
                will affect the levels of such budget 
                authority, budget outlays, revenues, or tax 
                expenditures under existing law for such fiscal 
                year (or fiscal years) and each of the [four] 
                nine ensuing fiscal years, and shall include a 
                comparison of those levels to comparable levels 
                for the current fiscal year if timely submitted 
                before such report is filed; and

           *       *       *       *       *       *       *

    (b) Up-To-Date Tabulations of Congressional Budget 
Action.--
            (1) The Director of the Congressional Budget Office 
        shall issue to the committees of the House of 
        Representatives and the Senate reports on at least a 
        monthly basis detailing and tabulating the progress of 
        congressional action on bills and joint resolutions 
        providing new budget authority or providing an increase 
        or decrease in revenues or tax expenditures for each 
        fiscal year covered by a [concurrent] joint resolution 
        on the budget. Such reports shall include but are not 
        limited to an up-to-date tabulation comparing the 
        appropriate aggregate and functional levels (including 
        outlays) included in the most recently adopted 
        [concurrent] joint resolution on the budget with the 
        levels provided in bills and joint resolutions reported 
        by committees or adopted by either House or by the 
        Congress, and with the levels provided by law for the 
        fiscal year preceding the first fiscal year covered by 
        the appropriate [concurrent] joint resolution. Such 
        reports shall also include an up-to-date tabulation of 
        the amounts contained in the ledger and each entry 
        established by section 318(a).
            (2) The Committee on the Budget of each House shall 
        make available to Members of its House summary budget 
        scorekeeping reports. Such reports--
                    (A) shall be made available on at least a 
                monthly basis, but in any case frequently 
                enough to provide Members of each House an 
                accurate representation of the current status 
                of congressional consideration of the budget;
                    (B) shall include, but are not limited to 
                summaries of tabulations provided under 
                subsection (b)(1); [and]
                    (C) shall be based on information provided 
                under subsection (b)(1) without substantive 
                revision[.]; and
                    (D) shall include an up-to-date tabulation 
                of amounts remaining in the reserve funds for 
                emergencies.
The chairman of the Committee on the Budget of the House of 
Representatives shall submit such reports to the Speaker.

           *       *       *       *       *       *       *


                             reconciliation

    Sec. 310. (a) Inclusion of Reconciliation Directives in 
[Concurrent]  Joint Explanatory Statement Accompanying 
Conference Report on Joint Resolutions on the Budget.--[A] The 
joint explanatory statement accompanying the conference report 
on a [concurrent] joint resolution on the budget for any fiscal 
year, to the extent necessary to effectuate the provisions and 
requirements of such resolution, shall--
            (1) * * *

           *       *       *       *       *       *       *

    (b) Legislative Procedure.--[If] If the joint explanatory 
statement accompanying the conference report on a [concurrent] 
joint resolution containing directives to one or more 
committees to determine and recommend changes in laws, bills, 
or resolutions is [agreed to] enacted in accordance with 
subsection (a), and--
            (1) only one committee of the House or the Senate 
        is directed to determine and recommend changes, that 
        committee shall promptly make such determination and 
        recommendations and report to its House reconciliation 
        legislation containing such recommendations; or
            (2) more than one committee of the House or the 
        Senate is directed to determine and recommend changes, 
        each such committee so directed shall promptly make 
        such determination and recommendations and submit such 
        recommendations to the Committee on the Budget of its 
        House, which upon receiving all such recommendations, 
        shall report to its House reconciliation legislation 
        carrying out all such make in order amendments to 
        achieve changes specified by reconciliation directives 
        contained in a [concurrent] joint resolution on the 
        budget if a committee or committees of the House fail 
        to submit recommended changes to its Committee on the 
        Budget pursuant to its instruction.
    (c) Compliance With Reconciliation Directions.--(1) Any 
committee of the House of Representatives or the Senate that is 
directed, pursuant to the joint explanatory statement 
accompanying the conference report on a [concurrent] joint 
resolution on the budget, to determine and recommend changes of 
the type described in paragraphs (1) and (2) of subsection (a) 
with respect to laws within its jurisdiction, shall be deemed 
to have complied with such directions--
            (A) if--
                    (i) the amount of the changes of the type 
                described in paragraph (1) of such subsection 
                recommended by such committee do not exceed or 
                fall below the amount of the changes such 
                committee was directed by such [concurrent] 
                joint resolution to recommend under that 
                paragraph by more than--
                            (I) * * *

           *       *       *       *       *       *       *

                    (ii) the amount of the changes of the type 
                described in paragraph (2) of such subsection 
                recommended by such committee do not exceed or 
                fall below the amount of the changes such 
                committee was directed by such [concurrent] 
                joint resolution to recommend under that 
                paragraph by more than--
                            (I) * * *

           *       *       *       *       *       *       *

            (2)(A) * * *

           *       *       *       *       *       *       *

            (C) Allocations, functional levels, and aggregates 
        revised pursuant to this paragraph shall be considered 
        to be allocations, functional levels, and aggregates 
        contained in the [concurrent] joint resolution on the 
        budget pursuant to section 301.
            (D) Upon the filing of revised allocations pursuant 
        to this paragraph, the reporting committee shall report 
        revised allocations pursuant to section 302(b) to carry 
        out this subsection.
    (d) Limitation on Amendments to Reconciliation Bills and 
Resolutions.--
            (1) It shall not be in order in the House of 
        Representatives to consider any amendment to a 
        reconciliation bill or reconciliation resolution if 
        such amendment would have the effect of increasing any 
        specific budget outlays above the level of such outlays 
        provided in the bill or resolution (for the fiscal 
        years covered by the reconciliation instructions set 
        forth in the [most recently agreed to concurrent 
        resolution on the budget] most recently enacted joint 
        resolution on the budget or agreed to concurrent 
        resolution on the budget (as applicable)), or would 
        have the effect of reducing any specific Federal 
        revenues below the level of such revenues provided in 
        the bill or resolution (for such fiscal years), unless 
        such amendment makes at least an equivalent reduction 
        in other specific budget outlays, an equivalent 
        increase in other specific Federal revenues, or an 
        equivalent combination thereof (for such fiscal years), 
        except that a motion to strike a provision providing 
        new budget authority or new entitlement authority may 
        be in order.

           *       *       *       *       *       *       *

            (5) The Committee on Rules of the House of 
        Representatives may make in order amendments to achieve 
        changes specified by reconciliation directives 
        contained in a [concurrent] joint resolution on the 
        budget if a committee or committees of the House fail 
        to submit recommended changes to its Committee on the 
        Budget pursuant to its instruction.
    (e) Procedure in the Senate.--
            (1) Except as provided in paragraph (2), the 
        provisions of section 305 for the consideration in the 
        Senate of [concurrent] joint resolutions on the budget 
        and conference reports thereon shall also apply to the 
        consideration in the Senate of reconciliation bills 
        reported under subsection (b) and conference reports 
        thereon.

           *       *       *       *       *       *       *

    (f) Completion of Reconciliation Process.--It shall not be 
in order in the House of Representatives to consider any 
resolution providing for an adjournment period of more than 
three calendar days during the month of July until the House of 
Representatives has completed action on the reconciliation 
legislation for the fiscal year beginning on October 1 of the 
calendar year to which the adjournment resolution pertains, if 
reconciliation legislation is required to be reported by the 
[concurrent] joint resolution on the budget for such fiscal 
year.
    [(g) Limitation on Changes to the Social Security Act.--
Notwithstanding any other provision of law, it shall not be in 
order in the Senate or the House of Representatives to consider 
any reconciliation bill or reconciliation resolution reported 
pursuant to a concurrent resolution on the budget agreed to 
under section 301 or 304, or a joint resolution pursuant to 
section 258C of the Balanced Budget and Emergency Deficit 
Control Act of 1985, or any amendment thereto or conference 
report thereon, that contains recommendations with respect to 
the old-age, survivors, and disability insurance program 
established under title II of the Social Security Act.]

      budget-related legislation must be within appropriate levels

    Sec. 311. (a) Enforcement of Budget Aggregates.--
            (1) In the house of representatives.--Except as 
        provided by subsection (c), after the Congress has 
        completed action on a [concurrent] joint resolution on 
        the budget for a fiscal year, it shall not be in order 
        in the House of Representatives to consider any bill, 
        joint resolution, amendment, motion, or conference 
        report providing new budget authority or reducing 
        revenues, if--
                    (A) the enactment of that bill or 
                resolution as reported;
                    (B) the adoption and enactment of that 
                amendment; or
                    (C) the enactment of that bill or 
                resolution in the form recommended in that 
                conference report;
        would cause the level of total new budget authority or 
        total outlays set forth in the applicable [concurrent] 
        joint resolution on the budget for the first fiscal 
        year to be exceeded, or would cause revenues to be less 
        than the level of total revenues set forth in that 
        [concurrent] joint resolution for the first fiscal year 
        or for the total of that first fiscal year and the 
        ensuing fiscal years for which allocations are provided 
        under section 302(a), except when a declaration of war 
        by the Congress is in effect.
            (2) In the senate.--After a [concurrent] joint 
        resolution on the budget is [agreed to] enacted, it 
        shall not be in order in the Senate to consider any 
        bill, joint resolution, amendment, motion, or 
        conference report that--
                    (A) * * *

           *       *       *       *       *       *       *

            (3) Enforcement of social security levels in the 
        senate.--After a [concurrent] joint resolution on the 
        budget is [agreed to] enacted, it shall not be in order 
        in the Senate to consider any bill, joint resolution, 
        amendment, motion, or conference report that would 
        cause a decrease in social security surpluses or an 
        increase in social security deficits relative to the 
        levels set forth in the applicable resolution for the 
        first fiscal year or for the total of that fiscal year 
        and the ensuing fiscal years for which allocations are 
        provided under section 302(a).

           *       *       *       *       *       *       *


                   determinations and points of order

    Sec. 312. (a) * * *

           *       *       *       *       *       *       *

    (c) Maximum Deficit Amount Point of Order in the Senate.--
It shall not be in order in the Senate to consider any 
[concurrent] joint resolution on the budget for a fiscal year, 
or to consider any amendment to that [concurrent] joint 
resolution, or to consider a conference report on that 
[concurrent] joint resolution, if--
            (1) the level of total outlays for the first fiscal 
        year set forth in that [concurrent] joint resolution or 
        conference report exceeds; or

           *       *       *       *       *       *       *

    (e) Points of Order in the Senate Against Amendments 
Between the Houses.--Each provision of this Act, except for 
section 313, that establishes a point of order against an 
amendment also establishes a point of order in the Senate 
against an amendment between the Houses. If a point of order 
under this Act is raised in the Senate against an amendment 
between the Houses and the point of order is sustained, the 
effect shall be the same as if the Senate had disagreed to the 
amendment.

           *       *       *       *       *       *       *


            extraneous matter in reconciliation legislation

    Sec. 313. (a) * * *

           *       *       *       *       *       *       *

    (c) Extraneous Materials.--Upon the reporting or discharge 
of a reconciliation bill or resolution pursuant to section 310 
in the Senate, [and again upon the submission of a conference 
report on such a reconciliation bill or resolution,] the 
Committee on the Budget of the Senate shall submit for the 
record a list of material considered to be extraneous under 
subsections (b)(1)(A), (b)(1)(B), and (b)(1)(E) of this section 
to the instructions of a committee as provided in this section. 
The inclusion or exclusion of a provision shall not constitute 
a determination of extraneousness by the Presiding Officer of 
the Senate.
    [(d) Conference Reports.--When the Senate is considering a 
conference report on, or an amendment between the Houses in 
relation to, a reconciliation bill or reconciliation resolution 
pursuant to section 310, upon--
            [(1) a point of order being made by any Senator 
        against extraneous material meeting the definition of 
        subsections (b)(1)(A), (b)(1)(B), (b)(1)(D), (b)(1)(E), 
        or (b)(1)(F), and
            [(2) such point of order being sustained,
such material contained in such conference report or amendment 
shall be deemed stricken, and the Senate shall proceed, without 
intervening action or motion, to consider the question of 
whether the Senate shall recede from its amendment and concur 
with a further amendment, or concur in the House amendment with 
a further amendment, as the case may be, which further 
amendment shall consist of only that portion of the conference 
report or House amendment, as the case may be, not so stricken. 
Any such motion in the Senate shall be debatable for two hours. 
In any case in which such point of order is sustained against a 
conference report (or Senate amendment derived from such 
conference report by operation of this subsection), no further 
amendment shall be in order.]
    [(e)] (d) General Point of Order.--Notwithstanding any 
other law or rule of the Senate, it shall be in order for a 
Senator to raise a single point of order that several 
provisions of a bill, resolution, amendment[, motion, or 
conference report], or motion violate this section. The 
Presiding Officer may sustain the point of order as to some or 
all of the provisions against which the Senator raised the 
point of order. If the Presiding Officer so sustains the point 
of order as to some of the provisions (including provisions of 
an amendment[, motion, or conference report] or motion) against 
which the Senator raised the point of order, then only those 
provisions (including provisions of an amendment[, motion, or 
conference report] or motion) against which the Presiding 
Officer sustains the point of order shall be deemed stricken 
pursuant to this section. Before the Presiding Officer rules on 
such a point of order, any Senator may move to waive such a 
point of order as it applies to some or all of the provisions 
against which the point of order was raised. Such a motion to 
waive is amendable in accordance with the rules and precedents 
of the Senate. After the Presiding Officer rules on such a 
point of order, any Senator may appeal the ruling of the 
Presiding Officer on such a point of order as it applies to 
some or all of the provisions on which the Presiding Officer 
ruled.

                              adjustments

    Sec. 314. (a) Adjustments.--
            (1) * * *
            (2) Matters to be adjusted.--The adjustments 
        referred to in paragraph (1) are to be made to--
                    (A) the discretionary spending limits, if 
                any, set forth in the appropriate [concurrent] 
                joint resolution on the budget;
                    (B) the allocations made pursuant to the 
                appropriate [concurrent] joint resolution on 
                the budget pursuant to section 302(a); and
                    (C) the budgetary aggregates as set forth 
                in the appropriate [concurrent] joint 
                resolution on the budget.
    (b) Amounts of Adjustments.--The adjustment referred to in 
subsection (a) shall be--
            [(1) an amount provided and designated as an 
        emergency requirement pursuant to section 251(b)(2)(A) 
        or 252(e) of the Balanced Budget and Emergency Deficit 
        Control Act of 1985;]
            [(2)] (1) an amount provided for continuing 
        disability reviews subject to the limitations in 
        section 251(b)(2)(C) of that Act;
            [(3)] (2) for any fiscal year through 2002, an 
        amount provided that is the dollar equivalent of the 
        Special Drawing Rights with respect to--
                    (A) * * *

           *       *       *       *       *       *       *

            [(4)] (3) an amount provided not to exceed 
        $1,884,000,000 for the period of fiscal years 1998 
        through 2000 for arrearages for international 
        organizations, international peacekeeping, and 
        multilateral development banks;
            [(5)] (4) an amount provided for an earned income 
        tax credit compliance initiative but not to exceed--
                    (A) * * *

           *       *       *       *       *       *       *

                    (E) with respect to fiscal year 2002, 
                $146,000,000 in new budget authority; [or]
            [(6)] (5) in the case of an amount for adoption 
        incentive payments (as defined in section 251(b)(2)(G) 
        of the Balanced Budget and Emergency Deficit Control 
        Act of 1985) for fiscal year 1999, 2000, 2001, 2002, or 
        2003 for the Department of Health and Human Services, 
        an amount not to exceed $20,000,000[.]; or
            (6) the amount provided in an Act making 
        discretionary appropriations for the program for which 
        an offset was designated pursuant to section 252(e) of 
        the Balanced Budget and Emergency Deficit Control Act 
        of 1985 and any outlays flowing therefrom, but not to 
        exceed the amount of the designated decrease in direct 
        spending for that year for that program in a prior law.

           *       *       *       *       *       *       *

    (d) [Reporting] Revised Suballocations.--Following any 
adjustment made under subsection (a), the chairmen of the 
Committees on Appropriations of the Senate and the House of 
Representatives [may report] shall make and have published in 
the Congressional Record appropriately revised suballocations 
under section 302(b) to carry out this section. For purposes of 
considering amendments (other than for amounts for emergencies 
covered by subsection (b)(1)), suballocations shall be deemed 
to be so adjusted.

           *       *       *       *       *       *       *

    (f) Adjustment in Authorizing Committee's Allocations by 
Amount of Direct Spending Offset.--After the reporting of a 
bill or joint resolution (by a committee other than the 
Committee on Appropriations), or the offering of an amendment 
thereto or the submission of a conference report thereon, that 
contains a provision that decreases direct spending for any 
fiscal year and that is designated as an offset pursuant to 
section 252(e) of the Balanced Budget and Emergency Deficit 
Control Act of 1985, the chairman of the Committee on the 
Budget shall reduce the allocations of new budget authority and 
outlays made to such committee under section 302(a)(1) by the 
amount so designated.

   Effect of adoption of a special order of business in the house of 
                            representatives

    Sec. 315. For purposes of a [reported] bill or joint 
resolution considered in the House of Representatives pursuant 
to a special order of business, the term ``as reported'' in 
this title or title IV shall be considered to refer to the text 
made in order as an original bill or joint resolution for the 
purpose of amendment or to the text on which the previous 
question is ordered directly to passage, as the case may be.


    expedited procedures upon veto of joint resolution on the budget


    Sec. 316. (a) Special Rule.--If the President vetoes a 
joint resolution on the budget for a fiscal year, the majority 
leader of the House of Representatives or Senate (or his 
designee) may introduce a concurrent resolution on the budget 
or joint resolution on the budget for such fiscal year. If the 
Committee on the Budget of either House fails to report such 
concurrent or joint resolution referred to it within five 
calendar days (excluding Saturdays, Sundays, or legal holidays 
except when that House of Congress is in session) after the 
date of such referral, the committee shall be automatically 
discharged from further consideration of such resolution and 
such resolution shall be placed on the appropriate calendar.
    (b) Procedure in the House of Representatives and the 
Senate.--
            (1) Except as provided in paragraph (2), the 
        provisions of section 305 for the consideration in the 
        House of Representatives and in the Senate of joint 
        resolutions on the budget and conference reports 
        thereon shall also apply to the consideration of 
        concurrent resolutions on the budget introduced under 
        subsection (a) and conference reports thereon.
            (2) Debate in the Senate on any concurrent 
        resolution on the budget or joint resolution on the 
        budget introduced under subsection (a), and all 
        amendments thereto and debatable motions and appeals in 
        connection therewith, shall be limited to not more than 
        10 hours and in the House such debate shall be limited 
        to not more than 3 hours.
    (c) Contents of Concurrent Resolutions.--Any concurrent 
resolution on the budget introduced under subsection (a) shall 
be in compliance with section 301.
    (d) Effect of Concurrent Resolution on the Budget.--
Notwithstanding any other provision of this title, whenever a 
concurrent resolution on the budget described in subsection (a) 
is agreed to, then the aggregates, allocations, and 
reconciliation directives (if any) contained in the report 
accompanying such concurrent resolution or in such concurrent 
resolution shall be considered to be the aggregates, 
allocations, and reconciliation directives for all purposes of 
sections 302, 303, and 311 for the applicable fiscal years and 
such concurrent resolution shall be deemed to be a joint 
resolution for all purposes of this title and the Rules of the 
House of Representatives and any reference to the date of 
enactment of a joint resolution on the budget shall be deemed 
to be a reference to the date agreed to when applied to such 
concurrent resolution.


                              emergencies


    Sec. 317. (a) Adjustments.--
            (1) In general.--After the reporting of a bill or 
        joint resolution or the submission of a conference 
        report thereon that provides budget authority for any 
        emergency as identified pursuant to subsection (d)--
                    (A) the chairman of the Committee on the 
                Budget of the House of Representatives or the 
                Senate shall determine and certify, pursuant to 
                the guidelines referred to in section 204 of 
                the Comprehensive Budget Process Reform Act of 
                1999, the portion (if any) of the amount so 
                specified that is for an emergency within the 
                meaning of section 3(12); and
                    (B) such chairman shall make the adjustment 
                set forth in paragraph (2) for the amount of 
                new budget authority (or outlays) in that 
                measure and the outlays flowing from that 
                budget authority.
            (2) Matters to be adjusted.--The adjustments 
        referred to in paragraph (1) are to be made to the 
        allocations made pursuant to the appropriate joint 
        resolution on the budget pursuant to section 302(a) and 
        shall be in an amount not to exceed the amount reserved 
        for emergencies pursuant to the requirements of 
        subsection (b).
    (b) Reserve Funds for Emergencies.--
            (1) Amounts.--The amount set forth in the reserve 
        fund for emergencies for budget authority and outlays 
        for a fiscal year pursuant to section 301(a)(4) shall 
        equal--
                    (A) the average of the enacted levels of 
                budget authority for emergencies in the 5 
                fiscal years preceding the current year; and
                    (B) the average of the levels of outlays 
                for emergencies in the 5 fiscal years preceding 
                the current year flowing from the budget 
                authority referred to in subparagraph (A), but 
                only in the fiscal year for which such budget 
                authority first becomes available for 
                obligation.
            (2) Average levels.--For purposes of paragraph (1), 
        the amount used for a fiscal year to calculate the 
        average of the enacted levels when one or more of such 
        5 preceding fiscal years is any of fiscal years 1994 
        through 1998 is as follows: the amount of enacted 
        levels of budget authority and the amount of new 
        outlays flowing therefrom for emergencies, but only in 
        the fiscal year for which such budget authority first 
        becomes available for obligation for each of such 5 
        fiscal years, which shall be determined by the 
        Committees on the Budget of the House of 
        Representatives and the Senate after receipt of a 
        report on such matter transmitted to such committees by 
        the Director of the Congressional Budget Office 6 
        months after the date of enactment of this section and 
        thereafter in February of each calendar year.
    (c) Emergencies in Excess of Amounts in Reserve Fund.--
Whenever the Committee on Appropriations or any other committee 
reports any bill or joint resolution that provides budget 
authority for any emergency and the report accompanying that 
bill or joint resolution, pursuant to subsection (d), 
identifies any provision that increases outlays or provides 
budget authority (and the outlays flowing therefrom) for such 
emergency, the enactment of which would cause--
            (1) in the case of the Committee on Approrpiations, 
        the total amount of budget authority or outlays 
        provided for emergencies for the budget year; or
            (2) in the case of any other committee, the total 
        amount of budget authority or outlays provided for 
        emergencies for the budget year or the total of the 
        fiscal years;
in the joint resolution on the budget (pursuant to section 
301(a)(4)) to be exceeded:
            (A) Such bill or joint resolution shall be referred 
        to the Committee on the Budget of the House or the 
        Senate, as the case may be, with instructions to report 
        it without amendment, other than that specified in 
        subparagraph (B), within 5 legislative days of the day 
        in which it is reported from the originating committee. 
        If the Committee on the Budget of either House fails to 
        report a bill or joint resolution referred to it under 
        this subparagraph within such 5-day period, the 
        committee shall be automatically discharged from 
        further consideration of such bill or joint resolution 
        and such bill or joint resolution shall be placed on 
        the appropriate calendar.
            (B) An amendment to such a bill or joint resolution 
        referred to in this subsection shall only consist of an 
        exemption from section 251 or 252 (as applicable) of 
        the Balanced Budget and Emergency Deficit Control Act 
        of 1985 of all or any part of the provisions that 
        provide budget authority (and the outlays flowing 
        therefrom) for such emergency if the committee 
        determines, pursuant to the guidelines referred to in 
        section 204 of the Comprehensive Budget Process Reform 
        Act of 1999, that such budget authority is for an 
        emergency within the meaning of section 3(12).
            (C) If such a bill or joint resolution is reported 
        with an amendment specified in subaragraph (B) by the 
        Committee on the Budget of the House of Representatives 
        or the Senate, then the budget authority and resulting 
        outlays that are the subject of such amendment shall 
        not be included in any determinations under section 
        302(f) or 311(a) for any bill, joint resolution, 
        amendment, motion, or conference report.
    (d) Committee Notification of Emergency Legislation.--
Whenever the Committee on Appropriations or any other committee 
of either House (including a committee of conference) reports 
any bill or joint resolution that provides budget authority for 
any emergency, the report accompanying that bill or joint 
resolution (or the joint explanatory statement of managers in 
the case of a conference report on any such bill or joint 
resolution) shall identify all provisions that provide budget 
authority and the outlays flowing therefrom for such emergency 
and include a statement of the reasons why such budget 
authority meets the definition of an emergency pursuant to the 
guidelines referred to in section 204 of the Comprehensive 
Budget Process Reform Act of 1999.


                spending accountability lock-box ledger


    Sec. 318. (a) Establishment of Ledger.--The chairman of the 
Committee on the Budget of the House of Representatives and the 
chairman on the Committee on the Budget of the Senate shall 
each maintain a ledger to be known as the ``Spending 
Accountability Lock-box Ledger''. The Ledger shall be divided 
into entries corresponding to the subcommittees of the 
Committees on Appropriations. Each entry shall consist of three 
components: the ``House Lock-box Balance''; the ``Senate Lock-
box Balance''; and the ``Joint House-Senate Lock-box Balance''.
    (b) Components of Ledger.--Each component in an entry shall 
consist only of amounts credited to it under subsection (c). No 
entry of a negative amount shall be made.
    (c) Credit of Amounts to Ledger.--(1) In the House of 
Representatives or the Senate, whenever a Member offers an 
amendment to an appropriation bill to reduce new budget 
authority in any account, that Member may state the portion of 
such reduction that shall be--
            (A) credited to the House or Senate Lock-box 
        Balance, as applicable; or
            (B) used to offset an increase in new budget 
        authority in any other account;
            (C) allowed to remain within the applicable section 
        302(b) suballocation.
If no such statement is made, the amount of reduction in new 
budget authority resulting from the amendment shall be credited 
to the House or Senate Lock-box Balance, as applicable, if the 
amendment is agreed to.
    (2)(A) Except as provided by subparagraph (B), the chairmen 
of the Committees on the Budget shall, upon the engrossment of 
any appropriation bill by the House of Representatives and upon 
the engrossment of Senate amendments to that bill, credit to 
the applicable entry balance of that House amounts of new 
budget authority and outlays equal to the net amounts of 
reductions in new budget authority and in outlays resulting 
from amendments agreed to by that House to that bill.
    (B) When computing the net amounts of reductions in new 
budget authority and in outlays resulting from amendments 
agreed to by the House of Representatives or the Senate to an 
appropriation bill, the chairmen of the Committees on the 
Budget shall only count those portions of such amendments 
agreed to that were so designated by the Members offering such 
amendments as amounts to be credited to the House or Senate 
Lock-box Balance, as applicable, or that fall within the last 
sentence of paragraph (1).
    (3) The chairmen of the Committees on the Budget shall, 
upon the engrossment of Senate amendments to any appropriation 
bill, credit to the applicable Joint House-Senate Lock-box 
Balance the amounts of new budget authority and outlays equal 
to--
            (A) an amount equal to one-half of the sum of (i) 
        the amount of new budget authority in the House Lock-
        box Balance plus (ii) the amount of new budget 
        authority in the Senate Lock-box Balance for that 
        subcommittee; and
            (B) an amount equal to one-half of the sum of (i) 
        the amount of outlays in the House Lock-box Balance 
        plus (ii) the amount of outlays in the Senate Lock-box 
        Balance for that subcommittee.
    (4) Calculation of Lock-Box Savings in Senate.--For 
purposes of calculating under this section the net amounts of 
reductions in new budget authority and in outlays resulting 
from amendments agreed to by the Senate on an appropriation 
bill, the amendments reported to the Senate by its Committee on 
Appropriations shall be considered to be part of the original 
text of the bill.
    (d) Definition.--As used in this section, the term 
``appropriation bill'' means any general or special 
appropriation bill, and any bill or joint resolution making 
supplemental, deficiency, or continuing appropriations through 
the end of a fiscal year.
    (e) Tally During House Consideration.--The chairman of the 
Committee on the Budget of the House of Representatives shall 
maintain a running tally of the amendments adopted reflecting 
increases and decreases of budget authority in the bill as 
reported. This tally shall be available to Members in the House 
of Representatives during consideration of any appropriations 
bill by the House.

      TITLE IV--ADDITIONAL PROVISIONS TO IMPROVE FISCAL PROCEDURES

                       Part A--General Provisions

       [budget-related legislation not subject to appropriations]


         fixed-year authorizations required for direct spending


    Sec. 401. [(a) Controls on Certain Budget-related 
Legislation Not Subject to Appropriations.--It shall not be in 
order in either the House of Representatives or the Senate to 
consider any bill or joint resolution (in the House of 
Representatives only, as reported), amendment, motion, or 
conference report that provides--
            [(1) new authority to enter into contracts under 
        which the United States is obligated to make outlays;
            [(2) new authority to incur indebtedness (other 
        than indebtedness incurred under chapter 31 of title 31 
        of the United States Code) for the repayment of which 
        the United States is liable; or
            [(3) new credit authority;
unless that bill, joint resolution, amendment, motion, or 
conference report also provides that the new authority is to be 
effective for any fiscal year only to the extent or in the 
amounts provided in advance in appropriation Acts.
    [(b) Legislation Providing New Entitlement Authority.--
            [(1) Point of order.--It shall not be in order in 
        either the House of Representatives or the Senate to 
        consider any bill or joint resolution (in the House of 
        Representatives only, as reported), amendment, motion, 
        or conference report that provides new entitlement 
        authority that is to become effective during the 
        current fiscal year.
            [(2) If any committee of the House of 
        Representatives or the Senate reports any bill or 
        resolution which provides new entitlement authority 
        which is to become effective during a fiscal year and 
        the amount of new budget authority which will be 
        required for such fiscal year if such bill or 
        resolution is enacted as so reported exceeds the 
        appropriate allocation of new budget authority reported 
        under section 302(b) in connection with the most 
        recently agreed to concurrent resolution on the budget 
        for such fiscal year, such bill or resolution shall 
        then be referred to the Committee on Appropriations of 
        the Senate or may then be referred to the Committee on 
        Appropriations of the House, as the case may be, with 
        instructions to report it, with the committee's 
        recommendations, within 15 calendar days (not counting 
        any day on which that House is not in session) 
        beginning with the day following the day on which it is 
        so referred. If the Committee on Appropriations of 
        either House fails to report a bill or resolution 
        referred to it under this paragraph within such 15-day 
        period, the committee shall automatically be discharged 
        from further consideration of such bill or resolution 
        and such bill or resolution shall be placed on the 
        appropriate calendar.
            [(3) The Committee on Appropriations of each House 
        shall have jurisdiction to report any bill or 
        resolution referred to it under paragraph (2) with an 
        amendment which limits the total amount of new spending 
        authority provided in such bill or resolution.]
    (a) Limitation on Direct Spending.--It shall not be in 
order in the House of Representatives or in the Senate to 
consider a bill or joint resolution, or an amendment, motion, 
or conference report that provides direct spending for a new 
program, unless such spending is limited to a period of 10 or 
fewer fiscal years.
    [(c)] (b) Exceptions.--
            (1) [Subsections (a) and (b)] Subsection (a) shall 
        not apply to new spending authority if the budget 
        authority for outlays which will result from such new 
        spending authority is derived--
                    (A) * * *

           *       *       *       *       *       *       *

            (2) [Subsections (a) and (b)] Subsection (a) shall 
        not apply to new authority described in those 
        subsections to the extent that--
                    (A) * * *

           *       *       *       *       *       *       *


                analysis by congressional budget office

    Sec. 402. The Director of the Congressional Budget Office 
shall, to the extent practicable, prepare for each bill or 
resolution of a public character reported by any committee of 
the House of Representatives or the Senate (except the 
Committee on Appropriations of each House), or conference 
report thereon, and submit to such committee--
            (1) an estimate of the costs which would be 
        incurred in carrying out such [bill or resolution] 
        bill, joint resolution, or conference report in the 
        fiscal year in which it is to become effective and in 
        each of the [4] nine fiscal years following such fiscal 
        year, together with the basis for each such estimate;
            (2) a comparison of the estimates of costs 
        described in paragraph (1), with any available 
        estimates of costs made by such committee or by any 
        Federal agency; [and]
            (3) a description of each method for establishing a 
        Federal financial commitment contained in such bill or 
        resolution[.]; and
            (4) A determination of whether such bill, joint 
        resolution, or conference report provides direct 
        spending.
The estimates, comparison, and description so submitted shall 
be included in the report accompanying such bill or resolution 
if timely submitted to such committee before such report is 
filed, or in the case of a conference report, shall be included 
in the joint explanatory statement of managers accompanying 
such conference report if timely submitted before such report 
is filed.

           *       *       *       *       *       *       *


 study by the general accounting office of forms of federal financial 
         commitment that are not reviewed annually by congress

    Sec. 404. The General Accounting Office shall study those 
provisions of law which provide mandatory spending and report 
to the Congress its recommendations for the appropriate form of 
financing for activities or programs financed by such 
provisions not later than eighteen months after the effective 
date of this section. [Such report shall be revised from time 
to time.] Such report shall be revised at least once every five 
years and shall be transmitted to the chairman and ranking 
minority member of each committee of the House of 
Representatives and the Senate.

             off-budget agencies, programs, and activities

    Sec. 405. (a) Notwithstanding any other provision of law, 
budget authority, credit authority, and estimates of outlays 
and receipts for activities of the Federal budget which are 
off-budget immediately prior to the date of enactment of this 
section, not including activities of the Federal Old-Age and 
Survivors Insurance and Federal Disability Insurance Trust 
Funds, shall be included in a budget submitted pursuant to 
section 1105 of title 31, United States Code, and in a 
[concurrent] joint resolution on the budget reported pursuant 
to section 301 or section 304 of this Act and shall be 
considered, for purposes of this Act, budget authority, 
outlays, and spending authority in accordance with definitions 
set forth in this Act.

           *       *       *       *       *       *       *


      TITLE VI--BUDGETARY TREATMENT OF FEDERAL INSURANCE PROGRAMS

SEC. 601. SHORT TITLE.

    This title may be cited as the ``Federal Insurance 
Budgeting Act of 1999''.

SEC. 602. BUDGETARY TREATMENT.

    (a) President's Budget.--Beginning with fiscal year 2006, 
the budget of the Government pursuant to section 1105(a) of 
title 31, United States Code, shall be based on the risk-
assumed cost of Federal insurance programs.
    (b) Budget Accounting.--For any Federal insurance program--
            (1) the program account shall--
                    (A) pay the risk-assumed cost borne by the 
                taxpayer to the financing account, and
                    (B) pay actual insurance program 
                administrative costs;
            (2) the financing account shall--
                    (A) receive premiums and other income,
                    (B) pay all claims for insurance and 
                receive all recoveries,
                    (C) transfer to the program account on not 
                less than an annual basis amounts necessary to 
                pay insurance program administrative costs;
            (3) a negative risk-assumed cost shall be 
        transferred from the financing account to the program 
        account, and shall be transferred from the program 
        account to the general fund; and
            (4) all payments by or receipts of the financing 
        accounts shall be treated in the budget as a means of 
        financing.
    (c) Appropriations Required.--(1) Notwithstanding any other 
provision of law, insurance commitments may be made for fiscal 
year 2006 and thereafter only to the extent that new budget 
authority to cover their risk-assumed cost is provided in 
advance in an appropriation Act.
    (2) An outstanding insurance commitment shall not be 
modified in a manner that increases its risk-assumed cost 
unless budget authority for the additional cost has been 
provided in advance.
    (3) Paragraph (1) shall not apply to Federal insurance 
programs that constitute entitlements.
    (d) Reestimates.--The risk-assumed cost for a fiscal year 
shall be reestimated in each subsequent year. Such reestimate 
can equal zero. In the case of a positive reestimate, the 
amount of the reestimate shall be paid from the program account 
to the financing account. In the case of a negative reestimate, 
the amount of the reestimate shall be paid from the financing 
account to the program account, and shall be transferred from 
the program account to the general fund. Reestimates shall be 
displayed as a distinct and separately identified subaccount in 
the program account.
    (e) Administrative Expenses.--All funding for an agency's 
administration of a Federal insurance program shall be 
displayed as a distinct and separately identified subaccount in 
the program account.

SEC. 603. TIMETABLE FOR IMPLEMENTATION OF ACCRUAL BUDGETING FOR FEDERAL 
                    INSURANCE PROGRAMS.

    (a) Agency Requirements.--Agencies with responsibility for 
Federal insurance programs shall develop models to estimate 
their risk-assumed cost by year through the budget horizon and 
shall submit those models, all relevant data, a justification 
for critical assumptions, and the annual projected risk-assumed 
costs to OMB with their budget requests each year starting with 
the request for fiscal year 2002. Agencies will likewise 
provide OMB with annual estimates of modifications, if any, and 
reestimates of program costs.
    (b) Disclosure.--When the President submits a budget of the 
Government pursuant to section 1105(a) of title 31, United 
States Code, for fiscal year 2002, OMB shall publish a notice 
in the Federal Register advising interested persons of the 
availability of information describing the models, data 
(including sources), and critical assumptions (including 
explicit or implicit discount rate assumptions) that it or 
other executive branch entities would use to estimate the risk-
assumed cost of Federal insurance programs and giving such 
persons an opportunity to submit comments. At the same time, 
the chairman of the Committee on the Budget shall publish a 
notice for CBO in the Federal Register advising interested 
persons of the availability of information describing the 
models, data (including sources), and critical assumptions 
(including explicit or implicit discount rate assumptions) that 
it would use to estimate the risk-assumed cost of Federal 
insurance programs and giving such interested persons an 
opportunity to submit comments.
    (c) Revision.--(1) After consideration of comments pursuant 
to subsection (b), and in consultation with the Committees on 
the Budget of the House of Representatives and the Senate, OMB 
and CBO shall revise the models, data, and major assumptions 
they would use to estimate the risk-assumed cost of Federal 
insurance programs.
    (2) When the President submits a budget of the Government 
pursuant to section 1105(a) of title 31, United States Code, 
for fiscal year 2003, OMB shall publish a notice in the Federal 
Register advising interested persons of the availability of 
information describing the models, data (including sources), 
and critical assumptions (including explicit or implicit 
discount rate assumptions) that it or other executive branch 
entities used to estimate the risk-assumed cost of Federal 
insurance programs.
    (d) Display.--
            (1) In general.--For fiscal years 2003, 2004, and 
        2005 the budget submissions of the President pursuant 
        to section 1105(a) of title 31, United States Code, and 
        CBO's reports on the economic and budget outlook 
        pursuant to section 202(e)(1) and the President's 
        budgets, shall for display purposes only, estimate the 
        risk-assumed cost of existing or proposed Federal 
        insurance programs.
            (2) OMB.--The display in the budget submissions of 
        the President for fiscal years 2003, 2004, and 2005 
        shall include--
                    (A) a presentation for each Federal 
                insurance program in budget-account level 
                detail of estimates of risk-assumed cost;
                    (B) a summary table of the risk-assumed 
                costs of Federal insurance programs; and
                    (C) an alternate summary table of budget 
                functions and aggregates using risk-assumed 
                rather than cash-based cost estimates for 
                Federal insurance programs.
            (3) CBO.--In the second session of the 107th 
        Congress and the 108th Congress, CBO shall include in 
        its estimates under section 308, for display purposes 
        only, the risk-assumed cost of existing Federal 
        insurance programs, or legislation that CBO, in 
        consultation with the Committees on the Budget of the 
        House of Representatives and the Senate, determines 
        would create a new Federal insurance program.
    (e) OMB, CBO, and GAO Evaluations.--(1) Not later than 6 
months after the budget submission of the President pursuant to 
section 1105(a) of title 31, United States Code, for fiscal 
year 2005, OMB, CBO, and GAO shall each submit to the 
Committees on the Budget of the House of Representatives and 
the Senate a report that evaluates the advisability and 
appropriate implementation of this title.
    (2) Each report made pursuant to paragraph (1) shall 
address the following:
            (A) The adequacy of risk-assumed estimation models 
        used and alternative modeling methods.
            (B) The availability and reliability of data or 
        information necessary to carry out this title.
            (C) The appropriateness of the explicit or implicit 
        discount rate used in the various risk-assumed 
        estimation models.
            (D) The advisability of specifying a statutory 
        discount rate (such as the Treasury rate) for use in 
        risk-assumed estimation models.
            (E) The ability of OMB, CBO, or GAO, as applicable, 
        to secure any data or information directly from any 
        Federal agency necessary to enable it to carry out this 
        title.
            (F) The relationship between risk-assumed accrual 
        budgeting for Federal insurance programs and the 
        specific requirements of the Balanced Budget and 
        Emergency Deficit Control Act of 1985.
            (G) Whether Federal budgeting is improved by the 
        inclusion of risk-assumed cost estimates for Federal 
        insurance programs.
            (H) The advisability of including each of the 
        programs currently estimated on a risk-assumed cost 
        basis in the Federal budget on that basis.

SEC. 604. DEFINITIONS.

    For purposes of this title:
            (1) The term ``Federal insurance program'' means a 
        program that makes insurance commitments and includes 
        the list of such programs included in the joint 
        explanatory statement of managers accompanying the 
        conference report on the Comprehensive Budget Process 
        Reform Act of 1999.
            (2) The term ``insurance commitment'' means an 
        agreement in advance by a Federal agency to indemnify a 
        nonfederal entity against specified losses. This term 
        does not include loan guarantees as defined in title V 
        or benefit programs such as social security, medicare, 
        and similar existing social insurance programs.
            (3)(A) The term ``risk-assumed cost'' means the net 
        present value of the estimated cash flows to and from 
        the Government resulting from an insurance commitment 
        or modification thereof.
            (B) The cash flows associated with an insurance 
        commitment include--
                    (i) expected claims payments inherent in 
                the Government's commitment;
                    (ii) net premiums (expected premium 
                collections received from or on behalf of the 
                insured less expected administrative expenses);
                    (iii) expected recoveries; and
                    (iv) expected changes in claims, premiums, 
                or recoveries resulting from the exercise by 
                the insured of any option included in the 
                insurance commitment.
            (C) The cost of a modification is the difference 
        between the current estimate of the net present value 
        of the remaining cash flows under the terms of the 
        insurance commitment, and the current estimate of the 
        net present value of the remaining cash flows under the 
        terms of the insurance commitment as modified.
            (D) The cost of a reestimate is the difference 
        between the net present value of the amount currently 
        required by the financing account to pay estimated 
        claims and other expenditures and the amount currently 
        available in the financing account. The cost of a 
        reestimate shall be accounted for in the current year 
        in the budget of the Government pursuant to section 
        1105(a) of title 31, United States Code.
            (E) For purposes of this definition, expected 
        administrative expenses shall be construed as the 
        amount estimated to be necessary for the proper 
        administration of the insurance program. This amount 
        may differ from amounts actually appropriated or 
        otherwise made available for the administration of the 
        program.
            (4) The term ``program account'' means the budget 
        account for the risk-assumed cost, and for paying all 
        costs of administering the insurance program, and is 
        the account from which the risk-assumed cost is 
        disbursed to the financing account.
            (5) The term ``financing account'' means the 
        nonbudget account that is associated with each program 
        account which receives payments from or makes payments 
        to the program account, receives premiums and other 
        payments from the public, pays insurance claims, and 
        holds balances.
            (6) The term ``modification'' means any Government 
        action that alters the risk-assumed cost of an existing 
        insurance commitment from the current estimate of cash 
        flows. This includes any action resulting from new 
        legislation, or from the exercise of administrative 
        discretion under existing law, that directly or 
        indirectly alters the estimated cost of existing 
        insurance commitments.
            (7) The term ``model'' means any actuarial, 
        financial, econometric, probabilistic, or other 
        methodology used to estimate the expected frequency and 
        magnitude of loss-producing events, expected premiums 
        or collections from or on behalf of the insured, 
        expected recoveries, and administrative expenses.
            (8) The term ``current'' has the same meaning as in 
        section 250(c)(9) of the Balanced Budget and Emergency 
        Deficit Control Act of 1985.
            (9) The term ``OMB'' means the Director of the 
        Office of Management and Budget.
            (10) The term ``CBO'' means the Director of the 
        Congressional Budget Office.
            (11) The term ``GAO'' means the Comptroller General 
        of the United States.

SEC. 605. AUTHORIZATIONS TO ENTER INTO CONTRACTS; ACTUARIAL COST 
                    ACCOUNT.

    (a) Authorization of Appropriations.--There is authorized 
to be appropriated $600,000 for each of fiscal years 2000 
through 2005 to the Director of the Office of Management and 
Budget and each agency responsible for administering a Federal 
program to carry out this title.
    (b) Treasury Transactions With the Financing Accounts.--The 
Secretary of the Treasury shall borrow from, receive from, lend 
to, or pay the insurance financing accounts such amounts as may 
be appropriate. The Secretary of the Treasury may prescribe 
forms and denominations, maturities, and terms and conditions 
for the transactions described above. The authorities described 
above shall not be construed to supersede or override the 
authority of the head of a Federal agency to administer and 
operate an insurance program. All the transactions provided in 
this subsection shall be subject to the provisions of 
subchapter II of chapter 15 of title 31, United States Code. 
Cash balances of the financing accounts in excess of current 
requirements shall be maintained in a form of uninvested funds, 
and the Secretary of the Treasury shall pay interest on these 
funds.
    (c) Appropriation of Amount Necessary To Cover Risk-Assumed 
Cost of Insurance Commitments at Transition Date.--(1) A 
financing account is established on September 30, 2005, for 
each Federal insurance program.
    (2) There is appropriated to each financing account the 
amount of the risk-assumed cost of Federal insurance 
commitments outstanding for that program as of the close of 
September 30, 2005.
    (3) These financing accounts shall be used in implementing 
the budget accounting required by this title.

SEC. 606. EFFECTIVE DATE.

    (a) In General.--This title shall take effect immediately 
and shall expire on September 30, 2007.
    (b) Special Rule.--If this title is not reauthorized by 
September 30, 2007, then the accounting structure and budgetary 
treatment of Federal insurance programs shall revert to the 
accounting structure and budgetary treatment in effect 
immediately before the date of enactment of this title.

                TITLE VII--PROGRAM REVIEW AND EVALUATION

           *       *       *       *       *       *       *


         continuing study of additional budget reform proposals

    Sec. 703. (a) The Committees on the Budget of the House of 
Representatives and the Senate shall study on a continuing 
basis proposals designed to improve and facilitate methods of 
congressional budgetmaking. The proposals to be studied shall 
include, but are not limited to, proposals for--
            (1) * * *

           *       *       *       *       *       *       *

            (3) establishing maximum and minimum time 
        limitations for program authorization; [and]
            (4) developing techniques of human resource 
        accounting and other means of providing noneconomic as 
        well as economic evaluation measures[.]; and
            (5) evaluating whether existing programs, projects, 
        and activities should be subject to discretionary 
        appropriations.
    (b) The Committee on the Budget of each House shall, [from 
time to time] during the One Hundred Sixth Congress, report to 
its House the results of the study carried on by it under 
subsection (a), together with its recommendations.

           *       *       *       *       *       *       *

    (d) The Committee on the Budget of each House shall 
establish guidelines for subjecting new or expanded programs, 
projects, and activities to annual appropriation and recommend 
any necessary changes in statutory enforcement mechanisms and 
scoring conventions to effectuate such changes.

           *       *       *       *       *       *       *


          TITLE IX--MISCELLANEOUS PROVISIONS; EFFECTIVE DATES

           *       *       *       *       *       *       *


                     exercise of rulemaking powers

    Sec. 904. (a) * * *

           *       *       *       *       *       *       *

    (c) Waivers.--
            (1) Permanent.--Sections 303(a), 305(b)(2), 
        305(c)(4), 305(e), 305(f), 306, 310(d)(2), 313, 904(c), 
        and 904(d) of this Act may be waived or suspended in 
        the Senate only by the affirmative vote of three-fifths 
        of the Members, duly chosen and sworn.

           *       *       *       *       *       *       *

    (d) Appeals.--
            (1) Procedure.--Appeals in the Senate from the 
        decisions of the Chair relating to any provision of 
        title III or IV or section 1017 shall, except as 
        otherwise provided therein, be limited to 1 hour, to be 
        equally divided between, and controlled by, the mover 
        and the manager of the resolution, [concurrent] joint 
        resolution, reconciliation bill, or rescission bill, as 
        the case may be.
            (2) Permanent.--An affirmative vote of three-fifths 
        of the Members, duly chosen and sworn, shall be 
        required in the Senate to sustain an appeal of the 
        ruling of the Chair on a point of order raised under 
        sections 303(a), 305(b)(2), 305(c)(4), 305(e), 305(f), 
        306, 310(d)(2), 313, 904(c), and 904(d) of this Act.

           *       *       *       *       *       *       *

                              ----------                              


                      TITLE 31, UNITED STATES CODE

           *       *       *       *       *       *       *


                    SUBTITLE II--THE BUDGET PROCESS

           *       *       *       *       *       *       *


CHAPTER 11--THE BUDGET AND FISCAL, BUDGET, AND PROGRAM INFORMATION

           *       *       *       *       *       *       *


Sec. 1105. Budget contents and submission to Congress

    (a) [On or after the first Monday in January but not later 
than the first Monday in February of each year the President 
shall submit a budget of the United States Government for the 
following fiscal year. Each budget shall include a budget 
message and summary and supporting information.] On or after 
the first Monday in January but not later than the first Monday 
in February of each year the President shall submit a budget of 
the United States Government for the following fiscal year 
which shall set forth the following levels:
            (A) totals of new budget authority and outlays;
            (B) total Federal revenues and the amount, if any, 
        by which the aggregate level of Federal revenues should 
        be increased or decreased by bills and resolutions to 
        be reported by the appropriate committees;
            (C) the surplus or deficit in the budget;
            (D) subtotals of new budget authority and outlays 
        for nondefense discretionary spending, defense 
        discretionary spending, direct spending, and interest; 
        and for fiscal years to which the amendments made by 
        title II of the Comprehensive Budget Process Reform Act 
        of 1999 apply, subtotals of new budget authority and 
        outlays for emergencies; and
            (E) the public debt.
Each budget submission shall include a budget message and 
summary and supporting information and, as a separately 
delineated statement, the levels required in the preceding 
sentence for at least each of the 9 ensuing fiscal years. The 
President shall include in each budget submission the 
following:
            (1)  * * *

           *       *       *       *       *       *       *

            [(5) except as provided in subsection (b) of this 
        section, estimated expenditures and proposed 
        appropriations the President decides are necessary to 
        support the Government in the fiscal year for which the 
        budget is submitted and the 4 fiscal years after that 
        year.
            [(6) estimated receipts of the Government in the 
        fiscal year for which the budget is submitted and the 4 
        fiscal years after that year under--
                    [(A) laws in effect when the budget is 
                submitted; and
                    [(B) proposals in the budget to increase 
                revenues.]
            (5) except as provided in subsection (b) of this 
        section, estimated expenditures and appropriations for 
        the current year and estimated expenditures and 
        proposed appropriations the President decides are 
        necessary to support the Government in the fiscal year 
        for which the budget is submitted and the 4 fiscal 
        years following that year, and, except for detailed 
        budget estimates, the percentage change from the 
        current year to the fiscal year for which the budget is 
        submitted for estimated expenditures and for 
        appropriations.
            (6) estimated receipts of the Government in the 
        current year and the fiscal year for which the budget 
        is submitted and the 4 fiscal years after that year 
        under--
                    (A) laws in effect when the budget is 
                submitted; and
                    (B) proposals in the budget to increase 
                revenues,
        and the percentage change (in the case of each category 
        referred to in subparagraphs (A) and (B)) between the 
        current year and the fiscal year for which the budget 
        is submitted and between the current year and each of 
        the 9 fiscal years after the fiscal year for which the 
        budget is submitted.

           *       *       *       *       *       *       *

            [(12) for each proposal in the budget for 
        legislation that would establish or expand a Government 
        activity or function, a table showing--
                    [(A) the amount proposed in the budget for 
                appropriation and for expenditure because of 
                the proposal in the fiscal year for which the 
                budget is submitted; and
                    [(B) the estimated appropriation required 
                because of the proposal for each of the 4 
                fiscal years after that year that the proposal 
                will be in effect.]
            (12) for each proposal in the budget for 
        legislation that would establish or expand a Government 
        activity or function, a table showing--
                    (A) the amount proposed in the budget for 
                appropriation and for expenditure because of 
                the proposal in the fiscal year for which the 
                budget is submitted;
                    (B) the estimated appropriation required 
                because of the proposal for each of the 4 
                fiscal years after that year that the proposal 
                will be in effect; and
                    (C) the estimated amount for the same 
                activity or function, if any, in the current 
                fiscal year,
        and, except for detailed budget estimates, the 
        percentage change (in the case of each category 
        referred to in subparagraphs (A), (B), and (C)) between 
        the current year and the fiscal year for which the 
        budget is submitted.

           *       *       *       *       *       *       *

            (18) a comparison of the total amount of new budget 
        authority and budget outlays for the prior fiscal year, 
        estimated in the budget submitted for that year, for 
        each major program having relatively uncontrollable 
        outlays with the total amount of outlays for that 
        program in that year.

           *       *       *       *       *       *       *

            (33) a justification for not subjecting each 
        proposed new direct spending program, project, or 
        activity to discretionary appropriations.
            (34) an analysis based upon current law and an 
        analysis based upon the policy assumptions underlying 
        the budget submission for every fifth year of the 
        period of 75 fiscal years beginning with such fiscal 
        year, of the estimated levels of total new budget 
        authority and total budget outlays, estimated revenues, 
        estimated surpluses and deficits, and, for social 
        security, medicare, medicaid, and all other direct 
        spending, estimated levels of total new budget 
        authority and total budget outlays; and a specification 
        of its underlying assumptions and a sensitivity 
        analysis of factors that have a significant effect on 
        the projections made in each analysis; and a comparison 
        of the effects of each of the two analyses on the 
        economy, including such factors as inflation, foreign 
        investment, interest rates, and economic growth.
            (35) a comparison of levels of estimated 
        expenditures and proposed appropriations for each 
        function and subfunction in the current fiscal year and 
        the fiscal year for which the budget is submitted, 
        along with the proposed increase or decrease of 
        spending in percentage terms for each function and 
        subfunction.
            (36) a table on sources of growth in total direct 
        spending under current law and as proposed in this 
        budget submission for the budget year and the ensuing 9 
        fiscal years, which shall include changes in outlays 
        attributable to the following: cost-of-living 
        adjustments; changes in the number of program 
        recipients; increases in medical care prices, 
        utilization and intensity of medical care; and residual 
        factors.

           *       *       *       *       *       *       *

    (f) The budget transmitted pursuant to subsection (a) for a 
fiscal year shall be prepared in a manner consistent with the 
requirements of the Balanced Budget and Emergency Deficit 
Control Act of 1985 that apply to that and subsequent fiscal 
years. Such budget submission shall also comply with the 
requirements of section 317(b) of the Congressional Budget Act 
of 1974 and, in the case of any budget authority requested for 
an emergency, such submission shall include a detailed 
justification of why such emergency is an emergency within the 
meaning of section 3(12) of the Congressional Budget Act of 
1974.

           *       *       *       *       *       *       *


Sec. 1109. Current programs and activities estimates

    (a) On or before the first Monday after January 3 of each 
year (on or before February 5 in 1986), the President shall 
submit to both Houses of Congress the estimated budget outlays 
and proposed budget authority that would be included in the 
budget for the following fiscal year if programs and activities 
of the United States Government were carried on during that 
year at the same level as the current fiscal year without a 
change in policy. For discretionary spending, these estimates 
shall assume the levels set forth in the discretionary spending 
limits under section 251(c) of the Balanced Budget and 
Emergency Deficit Control Act of 1985, as adjusted, for the 
appropriate fiscal years (and if no such limits are in effect, 
these estimates shall assume the adjusted levels for the most 
recent fiscal year for which such levels were in effect). The 
President shall state the estimated budget outlays and proposed 
budget authority by function and subfunction under the 
classifications in the budget summary table under the heading 
``Budget Authority and Outlays by Function and Agency'', by 
major programs in each function, and by agency. The President 
also shall include a statement of the economic and program 
assumptions on which those budget outlays and budget authority 
are based, including inflation, real economic growth, and 
unemployment rates, program caseloads, and pay increases.

           *       *       *       *       *       *       *


                       CHAPTER 13--APPROPRIATIONS

                          SUBCHAPTER I--GENERAL

Sec.
1301.  Application.
     * * * * * * *
1311.  Continuing appropriations.
     * * * * * * *

                         SUBCHAPTER I--GENERAL

Sec. 1311. Continuing appropriations

    (a)(1) If any regular appropriation bill for a fiscal year 
does not become law prior to the beginning of such fiscal year 
and a joint resolution making continuing appropriations (other 
than pursuant to this subsection) is not in effect, there is 
appropriated, out of any moneys in the Treasury not otherwise 
appropriated, and out of applicable corporate or other 
revenues, receipts, and funds, such sums as may be necessary to 
continue any program, project, or activity for which funds were 
provided in the preceding fiscal year--
            (A) in the corresponding regular appropriation Act 
        for such preceding fiscal year; or
            (B) if the corresponding regular appropriation bill 
        for such preceding fiscal year did not become law, then 
        in a joint resolution making continuing appropriations 
        for such preceding fiscal year.
    (2)(A) Except as provided by subparagraphs (B), (C), and 
(D), appropriations and funds made available, and authority 
granted, for a program, project, or activity for any fiscal 
year pursuant to this section shall be at a rate of operations 
not in excess of the rate of operations provided for in the 
regular appropriation Act providing for such program, project, 
or activity for the preceding fiscal year, or in the absence of 
such an Act, the rate of operations provided for such program, 
project, or activity pursuant to a joint resolution making 
continuing appropriations for such preceding fiscal year.
    (B) The applicable rate of operations for a program, 
project, or activity for any fiscal year pursuant to this 
section shall exclude amounts--
            (i) for which any adjustment was made under section 
        251(b)(2)(A) or section 252(e) of the Balanced Budget 
        and Emergency Deficit Control Act of 1985 before the 
        date of enactment of this section;
            (ii) provided for emergencies for which an 
        exemption from section 251 or 252 of such Act is 
        granted under section 317(c) of the Congressional 
        Budget Act of 1974; or
            (iii) for which any adjustment is made under 
        section 251(b)(2)(C) or (D) of such Act.
    (C) The applicable rate of operations for a program, 
project, or activity for any fiscal year pursuant to this 
section shall include amounts provided and rescinded for such 
program, project, or activity in any supplemental or special 
appropriations Act and in any rescission bill for that year 
that is enacted into law.
    (D) The applicable rate of operations for a program, 
project, or activity for any fiscal year pursuant to this 
section shall be reduced by the amount of budgetary resources 
cancelled in any such program, project, or activity resulting 
from the prior year's sequestration under section 251 of the 
Balanced Budget and Emergency Deficit Control Act of 1985 as 
published in OMB's final sequestration report for the prior 
fiscal year.
    (3) Appropriations and funds made available, and authority 
granted, for any fiscal year pursuant to this section for a 
program, project, or activity shall be available for the period 
beginning with the first day of a lapse in appropriations and 
ending with the earlier of--
            (A) the date on which the applicable regular 
        appropriation bill for such fiscal year becomes law 
        (whether or not such law provides for such program, 
        project, or activity) or a continuing resolution making 
        appropriations becomes law, as the case may be, or
            (B) the last day of such fiscal year.
    (b) An appropriation or funds made available, or authority 
granted, for a program, project, or activity for any fiscal 
year pursuant to this section shall be subject to the terms and 
conditions imposed with respect to the appropriation made or 
funds made available for the preceding fiscal year, or 
authority granted for such program, project, or activity under 
current law.
    (c) Appropriations and funds made available, and authority 
granted, for any program, project, or activity for any fiscal 
year pursuant to this section shall cover all obligations or 
expenditures incurred for such program, project, or activity 
during the portion of such fiscal year for which this section 
applies to such program, project, or activity.
    (d) Expenditures made for a program, project, or activity 
for any fiscal year pursuant to this section shall be charged 
to the applicable appropriation, fund, or authorization 
whenever a regular appropriation bill or a joint resolution 
making continuing appropriations until the end of a fiscal year 
providing for such program, project, or activity for such 
period becomes law.
    (e) This section shall not apply to a program, project, or 
activity during a fiscal year if any other provision of law 
(other than an authorization of appropriations)--
            (1) makes an appropriation, makes funds available, 
        or grants authority for such program, project, or 
        activity to continue for such period, or
            (2) specifically provides that no appropriation 
        shall be made, no funds shall be made available, or no 
        authority shall be granted for such program, project, 
        or activity to continue for such period; or
    (f) For purposes of this section, the term ``regular 
appropriation bill'' means any annual appropriation bill making 
appropriations, otherwise making funds available, or granting 
authority, for any of the following categories of programs, 
projects, and activities:
            (1) Agriculture, rural development, and related 
        agencies programs.
            (2) The Departments of Commerce, Justice, and 
        State, the judiciary, and related agencies.
            (3) The Department of Defense.
            (4) The government of the District of Columbia and 
        other activities chargeable in whole or in part against 
        the revenues of the District.
            (5) The Departments of Labor, Health and Human 
        Services, and Education, and related agencies.
            (6) The Department of Housing and Urban 
        Development, and sundry independent agencies, boards, 
        commissions, corporations, and offices.
            (7) Energy and water development.
            (8) Foreign assistance and related programs.
            (9) The Department of the Interior and related 
        agencies.
            (10) Military construction.
            (11) The Department of Transportation and related 
        agencies.
            (12) The Treasury Department, the U.S. Postal 
        Service, the Executive Office of the President, and 
        certain independent agencies.
            (13) The legislative branch.

           *       *       *       *       *       *       *

                              ----------                              


                  RULES OF THE HOUSE OF REPRESENTATIVES

           *       *       *       *       *       *       *


                                RULE X.

                      Organization of Committees.

Committees and their legislative jurisdictions
    1. There shall be in the House the following standing 
committees, each of which shall have the jurisdiction and 
related functions assigned by this clause and clauses 2, 3, and 
4. All bills, resolutions, and other matters relating to 
subjects within the jurisdiction of the standing committees 
listed in this clause shall be referred to those committees, in 
accordance with clause 2 of rule XII, as follows:
            (a)  * * *

           *       *       *       *       *       *       *

            (e) Committee on the Budget.
                    (1) [Concurrent] Joint resolutions on the 
                budget (as defined in section 3(4) of the 
                Congressional Budget Act of 1974), other 
                matters required to be referred to the 
                committee under titles III and IV of that Act, 
                and other measures setting forth appropriate 
                levels of budget totals for the United States 
                Government.

           *       *       *       *       *       *       *

General oversight responsibilities
    2. (a)  * * *

           *       *       *       *       *       *       *

    (d)(1) Not later than February 15 of the first session of a 
Congress, each standing committee shall, in a meeting that is 
open to the public and with a quorum present, adopt its 
oversight plan for that Congress. Such plan shall be submitted 
simultaneously to the Committee on Government Reform and to the 
Committee on House Administration. In developing its plan each 
committee shall, to the maximum extent feasible--
            (A)  * * *
            [(B) give priority consideration to including in 
        its plan the review of those laws, programs, or 
        agencies operating under permanent budget authority or 
        permanent statutory authority; and
            [(C) have a view toward ensuring that all 
        significant laws, programs, or agencies within its 
        jurisdiction are subject to review every 10 years.]
            (B) provide in its plans a specific timetable for 
        its review of those laws, programs, or agencies within 
        its jurisdiction, including those that operate under 
        permanent budget authority or permanent statutory 
        authority.

           *       *       *       *       *       *       *

Additional functions of committees
    4. (a)(1)  * * *
    [(2) Pursuant to section 401(b)(2) of the Congressional 
Budget Act of 1974, when a committee reports a bill or joint 
resolution that provides new entitlement authority as defined 
in section 3(9) of that Act, and enactment of the bill or joint 
resolution, as reported, would cause a breach of the 
committee's pertinent allocation of new budget authority under 
section 302(a) of that Act, the bill or joint resolution may be 
referred to the Committee on Appropriations with instructions 
to report it with recommendations (which may include an 
amendment limiting the total amount of new entitlement 
authority provided in the bill or joint resolution). If the 
Committee on Appropriations fails to report a bill or joint 
resolution so referred within 15 calendar days (not counting 
any day on which the House is not in session), the committee 
automatically shall be discharged from consideration of the 
bill or joint resolution, and the bill or joint resolution 
shall be placed on the appropriate calendar.]
    [(3)] (2) In addition, the Committee on Appropriations 
shall study on a continuing basis those provisions of law that 
(on the first day of the first fiscal year for which the 
congressional budget process is effective) provide spending 
authority or permanent budget authority and shall report to the 
House [from time to time] at least once each Congress its 
recommendations for terminating or modifying such provisions.
    [(4)] (3) In the manner provided by section 302 of the 
Congressional Budget Act of 1974, the Committee on 
Appropriations (after consulting with the Committee on 
Appropriations of the Senate) shall subdivide any allocations 
made to it in the joint explanatory statement accompanying the 
conference report on such [concurrent] joint resolution, and 
promptly report the subdivisions to the House as soon as 
practicable after a concurrent resolution on the budget for a 
fiscal year is agreed to.

           *       *       *       *       *       *       *

    (b) The Committee on the Budget shall--
            (1)  * * *
            (2) hold hearings and receive testimony from 
        Members, Senators, Delegates, the Resident 
        Commissioner, and such appropriate representatives of 
        Federal departments and agencies, the general public, 
        and national organizations as it considers desirable in 
        developing [concurrent] joint resolutions on the budget 
        for each fiscal year;

           *       *       *       *       *       *       *

    (e)(1)  * * *
    (2) Each standing committee shall review [from time to 
time] at least once every ten years each continuing program 
within its jurisdiction for which appropriations are not made 
annually to ascertain whether the program should be modified to 
provide for annual appropriations, and will provide specific 
information in any report accompanying such bills and joint 
resolutions to the greatest extent practicable to justify why 
the programs, projects, and activities involved would not be 
subject to annual appropriation.
    (f)(1) Each standing committee shall submit to the 
Committee on the Budget not later than six weeks after the 
President submits his budget, or at such time as the Committee 
on the Budget may request--
            (A) its views and estimates with respect to all 
        matters to be set forth in the [concurrent] joint 
        resolution on the budget for the ensuing fiscal year 
        that are within its jurisdiction or functions; and

           *       *       *       *       *       *       *

    (2) The views and estimates submitted by the Committee on 
Ways and Means under subparagraph (1) shall include a specific 
recommendation, made after holding public hearings, as to the 
appropriate level of the public debt that should be set forth 
in the [concurrent] joint resolution on the budget and serve as 
the basis for an increase or decrease in the statutory limit on 
such debt under the procedures provided by rule XXIII.

           *       *       *       *       *       *       *


                                RULE XI.

           Procedures of Committees and Unfinished Business.

In general
    1. (a)  * * *

           *       *       *       *       *       *       *

    (d)(1)  * * *

           *       *       *       *       *       *       *

    (4) Such report shall include a summary of and 
justifications for all bills and joint resolutions reported by 
such committee that--
            (A) were considered before the adoption of the 
        appropriate budget resolution and did not fall within 
        an exception set forth in section 303(b) of the 
        Congressional Budget Act of 1974;
            (B) exceeded its allocation under section 302(a) of 
        such Act or breached an aggregate level in violation of 
        section 311 of such Act; or
            (C) contained provisions in violation of section 
        401(a) of such Act pertaining to indefinite direct 
        spending authority.
Such report shall also specify the total amount by which 
legislation reported by that committee exceeded its allocation 
under section 302(a) or breached the revenue floor under 
section 311(a) of such Act for each fiscal year during that 
Congress.
    [(4)] (5) After an adjournment sine die of the last regular 
session of a Congress, the chairman of a committee may file an 
activities report under subparagraph (1) with the Clerk at any 
time and without approval of the committee, provided that--
            (A) a copy of the report has been available to each 
        member of the committee for at least seven calendar 
        days; and
            (B) the report includes any supplemental, minority, 
        or additional views submitted by a member of the 
        committee.

           *       *       *       *       *       *       *


                               RULE XIII.

                    Calendars and Committee Reports.

Calendars
    1.  * * *

           *       *       *       *       *       *       *

Content of reports
    3. (a)  * * *

           *       *       *       *       *       *       *

    (d) Each report of a committee on a public bill or public 
joint resolution shall contain the following:
            (1)  * * *
            (2)(A) An estimate by the committee of the costs 
        that would be incurred in carrying out the bill or 
        joint resolution in the fiscal year in which it is 
        reported and in each of the [five] 10 fiscal years 
        following that fiscal year (or for the authorized 
        duration of any program authorized by the bill or joint 
        resolution if less than [five] 10 years);

           *       *       *       *       *       *       *

            (4) A budget compliance statement prepared by the 
        chairman of the Committee on the Budget, if timely 
        submitted prior to the filing of the report, which 
        shall include assessment by such chairman as to whether 
        the bill or joint resolution complies with the 
        requirements of sections 302, 303, 306, 311, and 401 of 
        the Congressional Budget Act of 1974 and may include 
        the budgetary implications of that bill or joint 
        resolution under section 251 or 252 of the Balanced 
        Budget and Emergency Deficit Control Act of 1985, as 
        applicable.
Privileged reports by the Committee on Rules
    6. (a)  * * *

           *       *       *       *       *       *       *

    (h) It shall not be in order to consider any resolution 
from the Committee on Rules for the consideration of any 
reported bill or joint resolution which waives section 302, 
303, 311, or 401 of the Congressional Budget Act of 1974, 
unless the report accompanying such resolution includes a 
description of the provision proposed to be waived, an 
identification of the section being waived, the reasons why 
such waiver should be granted, and an estimated cost of the 
provisions to which the waiver applies.

                              RULE XVIII.

      The Committee of the Whole House on the State of the Union.

Resolving into the Committee of the Whole
    1.  * * *

           *       *       *       *       *       *       *

Reading for amendment
    5. (a)  * * *

           *       *       *       *       *       *       *

    (c)(1) In the Committee of the Whole, an amendment only to 
subject a new program which provides direct spending to 
discretionary appropriations, if offered by the chairman of the 
Committee on the Budget (or his designee) or the chairman of 
the Committee of Appropriations (or his designee), may be 
precluded from consideration only by the specific terms of a 
special order of the House. Any such amendment, if offered, 
shall be debatable for twenty minutes equally divided and 
controlled by the proponent of the amendment and a Member 
opposed and shall not be subject to amendment.
    (2) As used in subparagraph (1), the term ``direct 
spending'' has the meaning given such term in section 3(11) of 
the Congressional Budget and Impoundment Control Act of 1974.

           *       *       *       *       *       *       *

 Concurrent  Joint resolution on the budget
    10. (a) At the conclusion of general debate in the 
Committee of the Whole House on the state of the Union on a 
[concurrent] joint resolution on the budget under section 
305(a) of the Congressional Budget Act of 1974, the 
[concurrent] joint resolution shall be considered as read for 
amendment.
    (b) It shall not be in order in the House or in the 
Committee of the Whole House on the state of the Union to 
consider an amendment to a [concurrent] joint resolution on the 
budget, or an amendment thereto, unless the [concurrent] joint 
resolution, as amended by such amendment or amendments--
            (1) would be mathematically consistent except as 
        limited by paragraph (c); and
            (2) would contain all the matter set forth in 
        paragraphs (1) through [(5)] (6) of section 301(a) of 
        the Congressional Budget Act of 1974.
    [(c)(1) Except as specified in subparagraph (2), it shall 
not be in order in the House or in the Committee of the Whole 
House on the state of the Union to consider an amendment to a 
concurrent resolution on the budget, or an amendment thereto, 
that proposes to change the amount of the appropriate level of 
the public debt set forth in the concurrent resolution, as 
reported.
    [(2) Amendments to achieve mathematical consistency under 
section 305(a)(5) of the Congressional Budget Act of 1974, if 
offered by direction of the Committee on the Budget, may 
propose to adjust the amount of the appropriate level of the 
public debt set forth in the concurrent resolution, as 
reported, to reflect changes made in other figures contained in 
the concurrent resolution.]

           *       *       *       *       *       *       *


                                RULE XX.

                        Voting and Quorum Calls.

    1.  * * *

           *       *       *       *       *       *       *

Automatic yeas and nays
    10. The yeas and nays shall be considered as ordered when 
the Speaker puts the question on passage of a bill or joint 
resolution, or on adoption of a conference report, making 
general appropriations, or increasing Federal income tax rates 
(within the meaning of clause 5 of rule XXI), or on final 
adoption of a [concurrent] joint resolution on the budget or 
conference report thereon.

           *       *       *       *       *       *       *


                               RULE XXI.

                     Restrictions on Certain Bills.

Reservation of certain points of order
    1.  * * *
General appropriation bills and amendments
    2. (a)  * * *

           *       *       *       *       *       *       *

    [(e) A provision other than an appropriation designated an 
emergency under section 251(b)(2) or section 252(e) of the 
Balanced Budget and Emergency Deficit Control Act, a rescission 
of budget authority, or a reduction in direct spending or an 
amount for a designated emergency may not be reported in an 
appropriation bill or joint resolution containing an emergency 
designation under section 251(b)(2) or section 252(e) of such 
Act and may not be in order as an amendment thereto.]
    [(f)] (e) During the reading of an appropriation bill for 
amendment in the Committee of the Whole House on the state of 
the Union, it shall be in order to consider en bloc amendments 
proposing only to transfer appropriations among objects in the 
bill without increasing the levels of budget authority or 
outlays in the bill. When considered en bloc under this 
paragraph, such amendments may amend portions of the bill not 
yet read for amendment (following disposition of any points of 
order against such portions) and is not subject to a demand for 
division of the question in the House or in the Committee of 
the Whole.]

           *       *       *       *       *       *       *

    6. It shall not be in order to consider any bill, joint 
resolution, amendment, or conference report that authorizes the 
appropriation of new budget authority (as defined in section 
3(2)(C) of the Congressional Budget and Impoundment Control Act 
of 1974) for a new program, unless such authorization is 
specifically provided for a period of 10 or fewer fiscal years.

           *       *       *       *       *       *       *


                              [RULE XXIII.

                    [Statutory Limit on Public Debt.

    [1. Upon adoption by Congress of a concurrent resolution on 
the budget under section 301 or 304 of the Congressional Budget 
Act of 1974 that sets forth, as the appropriate level of the 
public debt for the period to which the concurrent resolution 
relates, an amount that is different from the amount of the 
statutory limit on the public debt that otherwise would be in 
effect for that period, the Clerk shall prepare an engrossment 
of a joint resolution increasing or decreasing, as the case may 
be, the statutory limit on the public debt in the form 
prescribed in clause 2. Upon engrossment of the joint 
resolution, the vote by which the concurrent resolution on the 
budget was finally agreed to in the House shall also be 
considered as a vote on passage of the joint resolution in the 
House, and the joint resolution shall be considered as passed 
by the House and duly certified and examined. The engrossed 
copy shall be signed by the Clerk and transmitted to the Senate 
for further legislative action.
    [2. The matter after the resolving clause in a joint 
resolution described in clause 1 shall be as follows: ``That 
subsection (b) of section 3101 of title 31, United States Code, 
is amended by striking out the dollar limitation contained in 
such subsection and inserting in lieu thereof `$____'.'', with 
the blank being filled with a dollar limitation equal to the 
appropriate level of the public debt set forth pursuant to 
section 301(a)(5) of the Congressional Budget Act of 1974 in 
the relevant concurrent resolution described in clause 1. If an 
adopted concurrent resolution under clause 1 sets forth 
different appropriate levels of the public debt for separate 
periods, only one engrossed joint resolution shall be prepared 
under clause 1; and the blank referred to in the preceding 
sentence shall be filled with the limitation that is to apply 
for each period.
    [3. (a) The report of the Committee on the Budget on a 
concurrent resolution described in clause 1 and the joint 
explanatory statement of the managers on a conference report to 
accompany such a concurrent resolution each shall contain a 
clear statement of the effect the eventual enactment of a joint 
resolution engrossed under this rule would have on the 
statutory limit on the public debt.
    [(b) It shall not be in order for the House to consider a 
concurrent resolution described in clause 1, or a conference 
report thereon, unless the report of the Committee on the 
Budget or the joint explanatory statement of the managers 
complies with paragraph (a).
    [4. Nothing in this rule shall be construed as limiting or 
otherwise affecting--
            [(a) the power of the House or the Senate to 
        consider and pass bills or joint resolutions, without 
        regard to the procedures under clause 1, that would 
        change the statutory limit on the public debt; or
            [(b) the rights of Members, Delegates, the Resident 
        Commissioner, or committees with respect to the 
        introduction, consideration, and reporting of such 
        bills or joint resolutions.
    [5. In this rule the term ``statutory limit on the public 
debt'' means the maximum face amount of obligations issued 
under authority of chapter 31 of title 31, United States Code, 
and obligations guaranteed as to principal and interest by the 
United States (except such guaranteed obligations as may be 
held by the Secretary of the Treasury), as determined under 
section 3101(b) of such title after the application of section 
3101(a) of such title, that may be outstanding at any one 
time.]
                              ----------                              


       BALANCED BUDGET AND EMERGENCY DEFICIT CONTROL ACT OF 1985

  PART C--EMERGENCY POWERS TO ELIMINATE DEFICITS IN EXCESS OF MAXIMUM 
                             DEFICIT AMOUNT

SEC. 250. TABLE OF CONTENTS; STATEMENT OF BUDGET ENFORCEMENT THROUGH 
                    SEQUESTRATION; DEFINITIONS.

    (a)  * * *

           *       *       *       *       *       *       *

    (c) Definitions.--
    As used in this part:
            (1)  * * *

           *       *       *       *       *       *       *

            (20) The term ``on-budget surplus'' means, with 
        respect to a fiscal year, the amount by which receipts 
        exceed outlays for all spending and receipt accounts of 
        the United States Government that are designated as on-
        budget. Such term does not include outlays and receipts 
        of the Federal Old-Age and Survivors Insurance Trust 
        Fund, the Federal Disability Insurance Trust Fund, or 
        any other off-budget entity.

SEC. 251. ENFORCING DISCRETIONARY SPENDING LIMITS.

    (a)  * * *
    (b) Adjustments to Discretionary Spending Limits.--
            (1)  * * *
            (2) Sequestration reports.--When OMB submits a 
        sequestration report under section 254(e), (f), or (g) 
        for a fiscal year, OMB shall calculate, and the 
        sequestration report and subsequent budgets submitted 
        by the President under section 1105(a) of title 31, 
        United States Code, shall include adjustments to 
        discretionary spending limits (and those limits as 
        adjusted) for the fiscal year and each succeeding year 
        through 2002, as follows:
                    [(A) Emergency appropriations.--If, for any 
                fiscal year, appropriations for discretionary 
                accounts are enacted that the President 
                designates as emergency requirements and that 
                the Congress so designates in statute, the 
                adjustment shall be the total of such 
                appropriations in discretionary accounts 
                designated as emergency requirements and the 
                outlays flowing in all fiscal years from such 
                appropriations. This subparagraph shall not 
                apply to appropriations to cover agricultural 
                crop disaster assistance.]

           *       *       *       *       *       *       *

                    [(B)] (A) Special outlay allowance.--If, in 
                any fiscal year, outlays for a category exceed 
                the discretionary spending limit for that 
                category but new budget authority does not 
                exceed its limit for that category (after 
                application of the first step of a 
                sequestration described in subsection (a)(2), 
                if necessary), the adjustment in outlays for a 
                fiscal year is the amount of the excess but not 
                to exceed 0.5 percent of the sum of the 
                adjusted discretionary spending limits on 
                outlays for that fiscal year.
                    [(C)] (B) Continuing disability reviews.--
                (i)  * * *

           *       *       *       *       *       *       *

                    [(D)] (C) Allowance for imf.--If an 
                appropriation bill or joint resolution is 
                enacted for a fiscal year through 2002 that 
                includes an appropriation with respect to 
                clause (i) or (ii), the adjustment shall be the 
                amount of budget authority in the measure that 
                is the dollar equivalent of the Special Drawing 
                Rights with respect to--
                            (i)  * * *

           *       *       *       *       *       *       *

                    [(E)] (D) Allowance for international 
                arrearages.--
                            (i)  * * *

           *       *       *       *       *       *       *

                    [(F)] (E) EITC compliance initiative.--If 
                an appropriation bill or joint resolution is 
                enacted for a fiscal year that includes an 
                appropriation for an earned income tax credit 
                compliance initiative, the adjustment shall be 
                the amount of budget authority in that measure 
                for that initiative and the outlays flowing in 
                all fiscal years from that budget authority, 
                but not to exceed--
                            (i)  * * *

           *       *       *       *       *       *       *

                    [(G)] (F) Adoption incentive payments.--
                Whenever a bill or joint resolution making 
                appropriations for fiscal year 1999, 2000, 
                2001, 2002, or 2003 is enacted that specifies 
                an amount for adoption incentive payments 
                pursuant to this part for the Department of 
                Health and Human 
                Services--
                            (i)  * * *
                    (G) Discretionary authorization offsets.--
                If an Act other than an appropriation Act 
                includes any provision reducing direct spending 
                and specifically identifies any such provision 
                as an offset pursuant to section 252(e), the 
                adjustments shall be an increase in the 
                discretionary spending limits for budget 
                authority and outlays in each fiscal year equal 
                to the amount of the budget authority and 
                outlay reductions, respectively, achieved by 
                the specified offset in that fiscal year, 
                except that the adjustments for the budget year 
                in which the offsetting provision takes effect 
                shall not exceed the amount of discretionary 
                new budget authority provided for the new 
                program (authorized in that Act) in an Act 
                making discretionary appropriations and the 
                outlays flowing therefrom.

           *       *       *       *       *       *       *


SEC. 252. ENFORCING PAY-AS-YOU-GO.

    [(a) Purpose.--The purpose of this section is to assure 
that any legislation enacted before October 1, 2002, affecting 
direct spending or receipts that increases the deficit will 
trigger an offsetting sequestration.
    [(b) Sequestration.--
            [(1) Timing.--Not later than 15 calendar days after 
        the date Congress adjourns to end a session and on the 
        same day as a sequestration (if any) under section 251 
        or 253, there shall be a sequestration to offset the 
        amount of any net deficit increase caused by all direct 
        spending and receipts legislation enacted before 
        October 1, 2002, as calculated under paragraph (2).
            [(2) Calculation of deficit increase.--OMB shall 
        calculate the amount of deficit increase or decrease by 
        adding--
                    [(A) all OMB estimates for the budget year 
                of direct spending and receipts legislation 
                transmitted under subsection (d);
                    [(B) the estimated amount of savings in 
                direct spending programs applicable to budget 
                year resulting from the prior year's 
                sequestration under this section or section 
                253, if any, as published in OMB's final 
                sequestration report for that prior year; and
                    [(C) any net deficit increase or decrease 
                in the current year resulting from all OMB 
                estimates for the current year of direct 
                spending and receipts legislation transmitted 
                under subsection (d) that were not reflected in 
                the final OMB sequestration report for the 
                current year.]
    (a) Purpose.--The purpose of this section is to trigger an 
offsetting sequestration in the amount by which any excess of 
decreases in receipts and increases in direct spending over 
increases in receipts and decreases in direct spending, caused 
by all direct spending and receipts legislation enacted prior 
to October 1, 2002, exceeds estimates of the on-budget surplus.
    (b) Sequestration.--
            (1) Timing.--Not later than 15 calendar days after 
        the date Congress adjourns to end a session and on the 
        same day as a sequestration (if any) under section 251, 
        there shall be a sequestration to offset an amount 
        equal to--
                    (A) any excess of decreases in receipts and 
                increases in direct spending over increases in 
                receipts and decreases in direct spending for 
                legislation enacted prior to October 1, 2002; 
                minus
                    (B) the estimated on-budget surplus (which 
                shall not be less than zero),
        as calculated under paragraph (2).
            (2) Calculation of sequestration.--OMB shall 
        calculate the amount of the sequestration by adding--
                    (A) all OMB estimates for the budget year 
                of direct spending and receipts legislation 
                transmitted under subsection (d) for 
                legislation enacted prior to October 1, 2002;
                    (B) the estimated amount of savings in 
                direct spending programs applicable to the 
                budget year resulting from the prior year's 
                sequestration under this section, if any, as 
                published in OMB's final sequestration report 
                for that prior year; and
                    (C) all OMB estimates for the current year 
                that were not reflected in the final OMB 
                sequestration report for that year; and
        then by subtracting from such sum the OMB estimate for 
        the budget year of the on-budget surplus (if any) as 
        set forth in the OMB final sequestration report 
        increased by the amount of budgetary resources 
        cancelled in any such program, project, or activity 
        resulting from a sequestration for the budget year on 
        the same day under section 251 as published in OMB's 
        final sequestration report.

           *       *       *       *       *       *       *

    (d) Estimates.--
            (1)  * * *

           *       *       *       *       *       *       *

            (4) Scope of estimates.--The estimates under this 
        section shall include the amount of change in outlays 
        or receipts for the current year (if applicable), the 
        budget year, and each outyear excluding any amounts 
        resulting from--
                    (A) full funding of, and continuation of, 
                the deposit insurance guarantee commitment in 
                effect under current estimates; and
                    [(B) emergency provisions as designated 
                under subsection (e).]
                    (B) offset provisions as designated under 
                subsection (e).

           *       *       *       *       *       *       *

    [(e) Emergency Legislation.--If a provision of direct 
spending or receipts legislation is enacted that the President 
designates as an emergency requirement and that the Congress so 
designates in statute, the amounts of new budget authority, 
outlays, and receipts in all fiscal years resulting from that 
provision shall be designated as an emergency requirement in 
the reports required under subsection (d). This subsection 
shall not apply to direct spending provisions to cover 
agricultural crop disaster assistance.]
    (e) Offsets.--If a provision of direct spending legislation 
is enacted that--
            (1) decreases direct spending for any fiscal year; 
        and
            (2) is designated as an offset pursuant to this 
        subsection and such designation specifically identifies 
        an authorization of discretionary appropriations 
        (contained in such legislation) for a new program,
then the reductions in new budget authority and outlays in all 
fiscal years resulting from that provision shall be designated 
as an offset in the reports required under subsection (d).

           *       *       *       *       *       *       *


SEC. 254. REPORTS AND ORDERS.

    (a)  * * *

           *       *       *       *       *       *       *

    (c) Sequestration Preview Reports.--
            (1)  * * *

           *       *       *       *       *       *       *

            (3) Pay-as-you-go sequestration reports.--The 
        preview reports shall set forth, for the current year 
        and the budget year, estimates for each of the 
        following:
                    (A)  * * *

           *       *       *       *       *       *       *

                    (C)(i) Mandatory.--In projecting the on-
                budget surplus (if any) for the budget year, 
                direct spending and receipts shall be 
                calculated consistent with the assumptions 
                under section 257(b) but shall exclude all 
                estimates of direct spending and receipts 
                legislation for such year enacted after the 
                date of enactment of this subparagraph (as 
                estimated by OMB when such legislation was 
                originally enacted).
                    (ii) Discretionary.--Except as provided by 
                the preceding sentence, the following 
                assumptions shall apply to the calculation of 
                such estimated surplus:
                            (I) For programs, projects, and 
                        activities for which a regular 
                        appropriation Act or a joint resolution 
                        (other than pursuant to section 1311 of 
                        title 31, United States Code) 
                        continuing appropriations through the 
                        end of the budget year is enacted, 
                        budgetary resources other than 
                        unobligated balances shall be at the 
                        level provided by that Act with the 
                        following adjustments:
                                    ``(aa) Include amounts of 
                                budget authority provided and 
                                rescinded for such year in any 
                                supplemental or special 
                                appropriation Act or rescission 
                                bill that is enacted into law.
                                    ``(bb) Reduce the level by 
                                the amount of budgetary 
                                resources canceled in any such 
                                program, project, or activity 
                                by a sequestration under 
                                section 251 as published in 
                                OMB's final sequestration 
                                report for such year.
                        Substantive changes to or restrictions 
                        on entitlement law or other mandatory 
                        spending law in an appropriation Act 
                        shall be counted in determining the 
                        level of direct spending and receipts 
                        for purposes of calculating the on-
                        budget surplus under this section.
                            (II) For programs, projects, and 
                        activities for which a regular 
                        appropriation Act or a joint resolution 
                        (other than pursuant to section 1311 of 
                        title 31, United States Code) 
                        continuing appropriations through the 
                        end of the budget year is not enacted, 
                        budgetary resources other than 
                        unobligated balances shall be at the 
                        level provided for the current year in 
                        regular appropriation Acts or a joint 
                        resolution (other than pursuant to 
                        section 1311 of title 31, United States 
                        Code) continuing appropriations through 
                        the end of the current year with the 
                        following adjustments:
                                    ``(aa) Include amounts of 
                                budget authority provided and 
                                rescinded for such year in any 
                                supplemental or special 
                                appropriation Act or rescission 
                                bill that is enacted into law.
                                    ``(bb) Reduce the level by 
                                the amount of budgetary 
                                resources canceled in any such 
                                program, project, or activity 
                                by a sequestration under 
                                section 251 as published in 
                                OMB's final sequestration 
                                report for such year.
                        Substantive changes to or restrictions 
                        on entitlement law or other mandatory 
                        spending law in an appropriation Act 
                        shall be counted in determining the 
                        level of direct spending and receipts 
                        for purposes of calculating the on-
                        budget surplus under this section. 
                        After making such adjustments, further 
                        adjust such amount using the 
                        assumptions set forth in section 
                        257(c)(1)-(5).
                    [(C)] (D) The sequestration percentage or 
                (if the required sequestration percentage is 
                greater than the maximum allowable percentage 
                for medicare) percentages necessary to 
                eliminate a deficit increase under section 
                252(c).

           *       *       *       *       *       *       *

    (f) Final Sequestration Reports.--
            (1)  * * *

           *       *       *       *       *       *       *

            (3) Pay-as-you-go and deficit sequestration 
        reports.--The final reports shall contain all the 
        information required in the pay-as-you-go and deficit 
        sequestration preview reports. In addition, these 
        reports shall contain, for the budget year, for each 
        account to be sequestered, estimates of the baseline 
        level of sequestrable budgetary resources and resulting 
        outlays and the amount of budgetary resources to be 
        sequestered and resulting outlay reductions. The 
        reports shall also contain estimates of the effects on 
        outlays of the sequestration in each outyear for direct 
        spending programs. In calculating the estimated on-
        budget surplus pursuant to section 252(b)(2), 
        notwithstanding section 254(j), OMB shall use economic 
        and technical assumptions that are up-to-date as of the 
        date of issuance of the sequestration preview reports.

           *       *       *       *       *       *       *


SEC. 258C. SPECIAL RECONCILIATION PROCESS.

    (a) Reporting of Resolutions and Reconciliation Bills and 
Resolutions, in the Senate or in the House of 
Representatives.--
            (1) Committee alternatives to presidential order.--
        After the submission of an OMB sequestration update 
        report under section 254 that envisions a sequestration 
        under section 252 or 253, each standing committee of 
        the Senate or House may, not later than October 10, 
        submit to the Committee on the Budget of the Senate or 
        House information of the type described in section 
        301(d) of the Congressional Budget Act of 1974 with 
        respect to alternatives to the order envisioned by such 
        report insofar as such order affects laws within the 
        jurisdiction of the committee.
            (2) Initial budget committee action.--After the 
        submission of such a report, the Committee on the 
        Budget of the Senate or House may, not later than 
        October 15, report to the Senate or House a resolution. 
        The resolution may affirm the impact of the order 
        envisioned by such report, in whole or in part. To the 
        extent that any part is not affirmed, the resolution 
        shall state which parts are not affirmed and shall 
        contain instructions to committees of the Senate or 
        House of the type referred to in section 310(a) of the 
        Congressional Budget Act of 1974, sufficient to achieve 
        at least the total level of deficit reduction contained 
        in those sections which are not affirmed.
            (3) Response of committees.--Committees instructed 
        pursuant to paragraph (2), or affected thereby, shall 
        submit their responses to the Budget Committee no later 
        than 10 days after the resolution referred to in 
        paragraph (2) is agreed to, except that if only one 
        such Committee is so instructed such Committee shall, 
        by the same date, report to the Senate or House a 
        reconciliation bill or reconciliation resolution 
        containing its recommendations in response to such 
        instructions. A committee shall be considered to have 
        complied with all instructions to it pursuant to a 
        resolution adopted under paragraph (2) if it has made 
        recommendations with respect to matters within its 
        jurisdiction which would result in a reduction in the 
        deficit at least equal to the total reduction directed 
        by such instructions.
            (4) Budget committee action.--Upon receipt of the 
        recommendations received in response to a resolution 
        referred to in paragraph (2), the Budget Committee 
        shall report to the Senate or House a reconciliation 
        bill or reconciliation resolution, or both, carrying 
        out all such recommendations without any substantive 
        revisions. In the event that a committee instructed in 
        a resolution referred to in paragraph (2) fails to 
        submit any recommendation (or, when only one committee 
        is instructed, fails to report a reconciliation bill or 
        resolution) in response to such instructions, the 
        Budget Committee shall include in the reconciliation 
        bill or reconciliation resolution reported pursuant to 
        this subparagraph legislative language within the 
        jurisdiction of the noncomplying committee to achieve 
        the amount of deficit reduction directed in such 
        instructions.

           *       *       *       *       *       *       *

            (7) Definition.--[For] In the Senate, for purposes 
        of paragraphs (1), (2), and (3), the term ``day'' shall 
        mean any calendar day on which the Senate is in 
        session.
    (b) Procedures.--
            (1) In general.--Except as provided in paragraph 
        (2), in the Senate or House the provisions of sections 
        305 and 310 of the Congressional Budget Act of 1974 for 
        the consideration of [concurrent] joint resolutions on 
        the budget and conference reports thereon shall also 
        apply to the consideration of resolutions, and 
        reconciliation bills and reconciliation resolutions 
        reported under this paragraph and conference reports 
        thereon.

           *       *       *       *       *       *       *

            (4) Bills and resolutions received from the other 
        house.--Any bill or resolution received [in the Senate 
        from the House] in the Senate or House of 
        Representatives from the other House, which is a 
        companion to a reconciliation bill or reconciliation 
        resolution of the [Senate] Senate or House of 
        Representatives, as the case may be, for the purposes 
        of this subsection, shall be considered in the [Senate] 
        in the applicable House pursuant to the provisions of 
        this subsection.

           *       *       *       *       *       *       *


                       VIEWS OF COMMITTEE MEMBERS

    Clause 2(1) of rule XI requires each committee to afford a 
2-day opportunity for members of the committee to file 
additional, minority, or dissenting views and to include the 
view in its report. The following views were submitted: