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110th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    110-153

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



 
        CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR 2008

                                _______
                                

                  May 16, 2007.--Ordered to be printed

                                _______
                                

 Mr. Spratt, from the Committee of Conference, submitted the following

                           CONFERENCE REPORT

                     [To accompany S. Con. Res. 21]

    The committee of conference on the disagreeing votes of the 
two Houses on the amendment of the House to the concurrent 
resolution (S. Con. Res. 21), revising the congressional budget 
for the United States Government for fiscal year 2007, 
establishing the congressional budget for the United States 
Government for fiscal year 2008, and setting forth appropriate 
budgetary levels for fiscal years 2009 through 2012, having 
met, after full and free conference, have agreed to recommend 
and do recommend to their respective Houses as follows:
    That the Senate recede from its disagreement to the 
amendment of the House and agree to the same with an amendment 
as follows:
    In lieu of the matter proposed to be inserted by the House 
amendment, insert the following:

SECTION 1. CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR 2008.

    (a) Declaration.--Congress declares that this resolution is 
the concurrent resolution on the budget for fiscal year 2008 
and that this resolution sets forth the appropriate budgetary 
levels for fiscal years 2007 and 2009 through 2012.
    (b) Table of Contents.--The table of contents for this 
concurrent resolution is as follows:

Section 1. Concurrent resolution on the budget for fiscal year 2008.

                 TITLE I--RECOMMENDED LEVELS AND AMOUNTS

Sec. 101. Recommended levels and amounts.
Sec. 102. Social Security.
Sec. 103. Major functional categories.

                        TITLE II--BUDGET PROCESS

Sec. 201. Pay-as-you-go point of order in the Senate.
Sec. 202. Senate point of order against reconciliation legislation that 
          would increase the deficit or reduce a surplus.
Sec. 203. Senate point of order against legislation increasing long-term 
          deficits.
Sec. 204. Emergency legislation.
Sec. 205. Extension of enforcement of budgetary points of order in the 
          Senate.
Sec. 206. Point of order against advance appropriations.
Sec. 207. Discretionary spending limits, program integrity initiatives, 
          and other adjustments.
Sec. 208. Application of previous allocations in the Senate.
Sec. 209. Senate point of order against provisions of appropriations 
          legislation that constitute changes in mandatory programs with 
          net costs.
Sec. 210. Compliance with section 13301 of the Budget Enforcement Act of 
          1990.
Sec. 211. Application and effect of changes in allocations and 
          aggregates.
Sec. 212. Adjustments to reflect changes in concepts and definitions.
Sec. 213. Exercise of rulemaking powers.

                        TITLE III--RESERVE FUNDS

Sec. 301. Deficit-neutral reserve fund for SCHIP legislation.
Sec. 302. Deficit-neutral reserve fund for veterans and wounded 
          servicemembers.
Sec. 303. Deficit-neutral reserve fund for tax relief.
Sec. 304. Deficit-neutral reserve fund for Medicare improvements.
Sec. 305. Deficit neutral reserve funds for health care quality, 
          effectiveness, efficiency, and transparency.
Sec. 306. Deficit-neutral reserve fund for higher education.
Sec. 307. Deficit-neutral reserve fund for the Farm Bill.
Sec. 308. Deficit-neutral reserve fund for energy legislation.
Sec. 309. Deficit-neutral reserve fund for county payments legislation.
Sec. 310. Deficit-neutral reserve fund for terrorism risk insurance 
          reauthorization.
Sec. 311. Deficit-neutral reserve fund for affordable housing.
Sec. 312. Deficit-neutral reserve fund for receipts from Bonneville 
          Power Administration.
Sec. 313. Deficit-neutral reserve fund for Indian claims settlement.
Sec. 314. Deficit-neutral reserve fund for improvements in health.
Sec. 315. Deficit-neutral reserve fund for child care.
Sec. 316. Deficit-neutral reserve fund for immigration reform in the 
          Senate.
Sec. 317. Deficit-reduction reserve fund.
Sec. 318. Deficit-neutral reserve fund for manufacturing initiatives in 
          the Senate.
Sec. 319. Deficit-neutral reserve fund for the Food and Drug 
          Administration in the Senate.
Sec. 320. Deficit-neutral reserve fund for Medicaid.
Sec. 321. Reserve fund adjustment for revenue measures in the House.
Sec. 322. Deficit-neutral reserve fund for San Joaquin River restoration 
          and Navajo Nation water rights settlements.
Sec. 323. Deficit-neutral reserve fund for selected tax relief policies 
          in the Senate.

                            TITLE IV--POLICY

Sec. 401. Policy on middle-income tax relief.
Sec. 402. Policy on defense priorities.
Sec. 403. Policy on college affordability.

            TITLE V--SENSE OF THE HOUSE AND SENSE OF CONGRESS

Sec. 501. Sense of Congress on servicemembers' and veterans' health care 
          and other priorities.
Sec. 502. Sense of Congress on the Innovation Agenda: A commitment to 
          competitiveness to keep America #1.
Sec. 503. Sense of Congress on homeland security.
Sec. 504. Sense of Congress regarding the ongoing need to respond to 
          Hurricanes Katrina and Rita.
Sec. 505. Sense of Congress regarding long-term sustainability of 
          entitlements.
Sec. 506. Sense of Congress regarding the need to maintain and build 
          upon efforts to fight hunger.
Sec. 507. Sense of Congress regarding affordable health coverage.
Sec. 508. Sense of Congress regarding extension of the statutory pay-as-
          you-go rule.
Sec. 509. Sense of Congress on long-term budgeting.
Sec. 510. Sense of Congress regarding pay parity.
Sec. 511. Sense of Congress regarding waste, fraud, and abuse.
Sec. 512. Sense of Congress regarding the importance of child support 
          enforcement.
Sec. 513. Sense of the House on State veterans cemeteries.
Sec. 514. Sense of Congress on the State Criminal Alien Assistance 
          Program.

                        TITLE VI--RECONCILIATION

Sec. 601. Reconciliation in the House.
Sec. 602. Deficit reduction reconciliation instruction in the Senate.

                TITLE I--RECOMMENDED LEVELS AND AMOUNTS

SEC. 101. RECOMMENDED LEVELS AND AMOUNTS.

    The following budgetary levels are appropriate for each of 
fiscal years 2007 through 2012:
            (1) Federal revenues.--For purposes of the 
        enforcement of this resolution:
                    (A) The recommended levels of Federal 
                revenues are as follows:
            Fiscal year 2007: $1,900,340,000,000.
            Fiscal year 2008: $2,015,858,000,000.
            Fiscal year 2009: $2,113,828,000,000.
            Fiscal year 2010: $2,169,484,000,000.
            Fiscal year 2011: $2,350,254,000,000.
            Fiscal year 2012: $2,488,301,000,000.
                    (B) The amounts by which the aggregate 
                levels of Federal revenues should be changed 
                are as follows:
            Fiscal year 2007: -$4,366,000,000.
            Fiscal year 2008: -$34,938,000,000.
            Fiscal year 2009: $6,902,000,000.
            Fiscal year 2010: $5,763,000,000.
            Fiscal year 2011: -$44,296,000,000.
            Fiscal year 2012: -$108,795,000,000.
            (2) New budget authority.--For purposes of the 
        enforcement of this resolution, the appropriate levels 
        of total new budget authority are as follows:
            Fiscal year 2007: $2,380,535,000,000.
            Fiscal year 2008: $2,496,028,000,000.
            Fiscal year 2009: $2,517,132,000,000.
            Fiscal year 2010: $2,569,696,000,000.
            Fiscal year 2011: $2,684,889,000,000.
            Fiscal year 2012: $2,719,268,000,000.
            (3) Budget outlays.--For purposes of the 
        enforcement of this resolution, the appropriate levels 
        of total budget outlays are as follows:
            Fiscal year 2007: $2,300,572,000,000.
            Fiscal year 2008: $2,469,636,000,000.
            Fiscal year 2009: $2,566,481,000,000.
            Fiscal year 2010: $2,600,036,000,000.
            Fiscal year 2011: $2,692,104,000,000.
            Fiscal year 2012: $2,703,556,000,000.
            (4) Deficits.--For purposes of the enforcement of 
        this resolution, the amounts of the deficits are as 
        follows:
            Fiscal year 2007: $400,232,000,000.
            Fiscal year 2008: $453,778,000,000.
            Fiscal year 2009: $452,653,000,000.
            Fiscal year 2010: $430,552,000,000.
            Fiscal year 2011: $341,850,000,000.
            Fiscal year 2012: $215,255,000,000.
            (5) Debt subject to limit.--Pursuant to section 
        301(a)(5) of the Congressional Budget Act of 1974, the 
        appropriate levels of the public debt are as follows:
            Fiscal year 2007: $8,932,264,000,000.
            Fiscal year 2008: $9,504,150,000,000.
            Fiscal year 2009: $10,073,725,000,000.
            Fiscal year 2010: $10,622,023,000,000.
            Fiscal year 2011: $11,077,407,000,000.
            Fiscal year 2012: $11,419,028,000,000.
            (6) Debt held by the public.--The appropriate 
        levels of debt held by the public are as follows:
            Fiscal year 2007: $5,047,318,000,000.
            Fiscal year 2008: $5,312,560,000,000.
            Fiscal year 2009: $5,561,383,000,000.
            Fiscal year 2010: $5,774,487,000,000.
            Fiscal year 2011: $5,881,776,000,000.
            Fiscal year 2012: $5,850,852,000,000.

SEC. 102. SOCIAL SECURITY.

    (a) Social Security Revenues.--For purposes of Senate 
enforcement under sections 302 and 311 of the Congressional 
Budget Act of 1974, the amounts of revenues of the Federal Old-
Age and Survivors Insurance Trust Fund and the Federal 
Disability Insurance Trust Fund are as follows:
            Fiscal year 2007: $637,586,000,000.
            Fiscal year 2008: $668,998,000,000.
            Fiscal year 2009: $702,851,000,000.
            Fiscal year 2010: $737,589,000,000.
            Fiscal year 2011: $772,605,000,000.
            Fiscal year 2012: $807,928,000,000.
    (b) Social Security Outlays.--For purposes of Senate 
enforcement under sections 302 and 311 of the Congressional 
Budget Act of 1974, the amounts of outlays of the Federal Old-
Age and Survivors Insurance Trust Fund and the Federal 
Disability Insurance Trust Fund are as follows:
            Fiscal year 2007: $441,676,000,000.
            Fiscal year 2008: $460,224,000,000.
            Fiscal year 2009: $478,578,000,000.
            Fiscal year 2010: $499,655,000,000.
            Fiscal year 2011: $520,743,000,000.
            Fiscal year 2012: $546,082,000,000.
    (c) Social Security Administrative Expenses.--In the 
Senate, the amounts of new budget authority and budget outlays 
of the Federal Old-Age and Survivors Insurance Trust Fund and 
the Federal Disability Insurance Trust Fund for administrative 
expenses are as follows:
        Fiscal year 2007:
            
                    (A) New budget authority, $4,692,000,000.
                    (B) Outlays, $4,727,000,000.
        Fiscal year 2008:
                    (A) New budget authority, $4,850,000,000.
                    (B) Outlays, $4,859,000,000.
        Fiscal year 2009:
                    (A) New budget authority, $4,996,000,000.
                    (B) Outlays, $4,970,000,000.
        Fiscal year 2010:
                    (A) New budget authority, $5,147,000,000.
                    (B) Outlays, $5,121,000,000.
        Fiscal year 2011:
                    (A) New budget authority, $5,306,000,000.
                    (B) Outlays, $5,278,000,000.
        Fiscal year 2012:
                    (A) New budget authority, $5,467,000,000.
                    (B) Outlays, $5,439,000,000.

SEC. 103. MAJOR FUNCTIONAL CATEGORIES.

    Congress determines and declares that the appropriate 
levels of new budget authority and outlays for fiscal years 
2007 through 2012 for each major functional category are:
            (1) National Defense (050):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $525,797,000,000.
                            (B) Outlays, $534,270,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $506,955,000,000.
                            (B) Outlays, $514,401,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $534,705,000,000.
                            (B) Outlays, $524,384,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $545,171,000,000.
                            (B) Outlays, $536,433,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $550,944,000,000.
                            (B) Outlays, $547,624,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $559,799,000,000.
                            (B) Outlays, $548,169,000,000.
            (2) International Affairs (150):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $28,795,000,000.
                            (B) Outlays, $31,308,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $34,678,000,000.
                            (B) Outlays, $33,070,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $35,602,000,000.
                            (B) Outlays, $32,664,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $35,980,000,000.
                            (B) Outlays, $33,070,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $36,630,000,000.
                            (B) Outlays, $33,528,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $37,257,000,000.
                            (B) Outlays, $34,150,000,000.
            (3) General Science, Space, and Technology (250):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $25,079,000,000.
                            (B) Outlays, $24,516,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $27,615,000,000.
                            (B) Outlays, $26,472,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $28,641,000,000.
                            (B) Outlays, $28,411,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $29,844,000,000.
                            (B) Outlays, $29,485,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $31,103,000,000.
                            (B) Outlays, $30,089,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $32,438,000,000.
                            (B) Outlays, $31,367,000,000.
            (4) Energy (270):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $2,943,000,000.
                            (B) Outlays, $1,369,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $3,408,000,000.
                            (B) Outlays, $1,162,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $3,209,000,000.
                            (B) Outlays, $1,590,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $3,275,000,000.
                            (B) Outlays, $1,782,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $3,346,000,000.
                            (B) Outlays, $1,829,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $3,404,000,000.
                            (B) Outlays, $2,111,000,000.
            (5) Natural Resources and Environment (300):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $31,332,000,000.
                            (B) Outlays, $32,919,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $33,384,000,000.
                            (B) Outlays, $35,219,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $33,910,000,000.
                            (B) Outlays, $35,704,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $34,660,000,000.
                            (B) Outlays, $35,834,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $35,113,000,000.
                            (B) Outlays, $36,035,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $36,094,000,000.
                            (B) Outlays, $36,507,000,000.
            (6) Agriculture (350):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $21,471,000,000.
                            (B) Outlays, $19,738,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $20,481,000,000.
                            (B) Outlays, $19,603,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $21,033,000,000.
                            (B) Outlays, $20,146,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $21,238,000,000.
                            (B) Outlays, $20,207,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $21,256,000,000.
                            (B) Outlays, $20,534,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $21,502,000,000.
                            (B) Outlays, $20,963,000,000.
            (7) Commerce and Housing Credit (370):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $5,515,000,000.
                            (B) Outlays, -$3,522,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $9,279,000,000.
                            (B) Outlays, $2,034,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $9,973,000,000.
                            (B) Outlays, $1,048,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $13,775,000,000.
                            (B) Outlays, $3,431,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $8,822,000,000.
                            (B) Outlays, $2,439,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $8,822,000,000.
                            (B) Outlays, $756,000,000.
            (8) Transportation (400):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $81,282,000,000.
                            (B) Outlays, $74,739,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $82,799,000,000.
                            (B) Outlays, $81,093,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $76,306,000,000.
                            (B) Outlays, $84,025,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $77,061,000,000.
                            (B) Outlays, $85,959,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $78,089,000,000.
                            (B) Outlays, $86,672,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $78,969,000,000.
                            (B) Outlays, $88,352,000,000.
            (9) Community and Regional Development (450):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $15,717,000,000.
                            (B) Outlays, $28,281,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $15,814,000,000.
                            (B) Outlays, $22,292,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $14,725,000,000.
                            (B) Outlays, $21,008,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $14,942,000,000.
                            (B) Outlays, $19,892,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $15,157,000,000.
                            (B) Outlays, $18,440,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $15,371,000,000.
                            (B) Outlays, $15,938,000,000.
            (10) Education, Training, Employment, and Social 
        Services (500):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $92,780,000,000.
                            (B) Outlays, $92,224,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $93,880,000,000.
                            (B) Outlays, $91,022,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $97,809,000,000.
                            (B) Outlays, $94,513,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $99,726,000,000.
                            (B) Outlays, $97,075,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $100,151,000,000.
                            (B) Outlays, $98,745,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $100,748,000,000.
                            (B) Outlays, $98,728,000,000.
            (11) Health (550):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $267,892,000,000.
                            (B) Outlays, $268,197,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $287,486,000,000.
                            (B) Outlays, $286,442,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $308,326,000,000.
                            (B) Outlays, $306,410,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $326,118,000,000.
                            (B) Outlays, $326,100,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $347,561,000,000.
                            (B) Outlays, $346,748,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $370,422,000,000.
                            (B) Outlays, $369,653,000,000.
            (12) Medicare (570):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $365,152,000,000.
                            (B) Outlays, $370,180,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $389,587,000,000.
                            (B) Outlays, $389,703,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $416,710,000,000.
                            (B) Outlays, $416,367,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $442,347,000,000.
                            (B) Outlays, $442,569,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $489,077,000,000.
                            (B) Outlays, $489,087,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $486,804,000,000.
                            (B) Outlays, $486,417,000,000.
            (13) Income Security (600):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $360,365,000,000.
                            (B) Outlays, $364,204,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $380,763,000,000.
                            (B) Outlays, $384,301,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $391,707,000,000.
                            (B) Outlays, $393,962,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $401,747,000,000.
                            (B) Outlays, $402,784,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $417,020,000,000.
                            (B) Outlays, $417,013,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $402,674,000,000.
                            (B) Outlays, $402,008,000,000.
            (14) Social Security (650):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $19,089,000,000.
                            (B) Outlays, $19,089,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $19,644,000,000.
                            (B) Outlays, $19,644,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $21,518,000,000.
                            (B) Outlays, $21,518,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $23,701,000,000.
                            (B) Outlays, $23,701,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $27,009,000,000.
                            (B) Outlays, $27,009,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $29,898,000,000.
                            (B) Outlays, $29,898,000,000.
            (15) Veterans Benefits and Services (700):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $73,896,000,000.
                            (B) Outlays, $72,342,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $85,262,000,000.
                            (B) Outlays, $84,421,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $87,787,000,000.
                            (B) Outlays, $88,290,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $90,414,000,000.
                            (B) Outlays, $89,981,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $96,033,000,000.
                            (B) Outlays, $95,543,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $93,325,000,000.
                            (B) Outlays, $92,666,000,000.
            (16) Administration of Justice (750):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $45,504,000,000.
                            (B) Outlays, $44,659,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $47,998,000,000.
                            (B) Outlays, $47,131,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $48,315,000,000.
                            (B) Outlays, $49,120,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $49,220,000,000.
                            (B) Outlays, $49,449,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $50,146,000,000.
                            (B) Outlays, $49,969,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $51,079,000,000.
                            (B) Outlays, $50,759,000,000.
            (17) General Government (800):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $18,193,000,000.
                            (B) Outlays, $18,574,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $18,628,000,000.
                            (B) Outlays, $19,012,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $19,254,000,000.
                            (B) Outlays, $19,323,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $19,876,000,000.
                            (B) Outlays, $19,755,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $20,637,000,000.
                            (B) Outlays, $20,360,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $21,349,000,000.
                            (B) Outlays, $21,183,000,000.
            (18) Net Interest (900):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $344,509,000,000.
                            (B) Outlays, $344,509,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $370,578,000,000.
                            (B) Outlays, $370,578,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $391,056,000,000.
                            (B) Outlays, $391,056,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        $414,724,000,000.
                            (B) Outlays, $414,724,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        $433,665,000,000.
                            (B) Outlays, $433,665,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        $448,597,000,000.
                            (B) Outlays, $448,597,000,000.
            (19) Allowances (920):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $785,000,000.
                            (B) Outlays, $755,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        -$6,394,000,000.
                            (B) Outlays, -$2,164,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        -$6,894,000,000.
                            (B) Outlays, -$6,319,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, 
                        -$7,190,000,000.
                            (B) Outlays, -$6,984,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, 
                        -$7,295,000,000.
                            (B) Outlays, -$7,181,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, 
                        -$7,427,000,000.
                            (B) Outlays, -$7,311,000,000.
            (20) Undistributed Offsetting Receipts (950):
                    Fiscal year 2007:
                            (A) New budget authority,       
                        -$69,714,000,000.
                            (B) Outlays, -$69,714,000,000.
                    Fiscal year 2008:
                            (A) New budget authority,       
                        -$70,979,000,000.
                            (B) Outlays, -$70,979,000,000.
                    Fiscal year 2009:
                            (A) New budget authority,       
                        -$66,560,000,000.
                            (B) Outlays, -$66,569,000,000.
                    Fiscal year 2010:
                            (A) New budget authority,       
                        -$66,933,000,000.
                            (B) Outlays, -$66,933,000,000.
                    Fiscal year 2011:
                            (A) New budget authority,       
                        -$69,575,000,000.
                            (B) Outlays, -$69,595,000,000.
                    Fiscal year 2012:
                            (A) New budget authority,       
                        -$71,857,000,000.
                            (B) Outlays, -$71,860,000,000.
            (21) Overseas Deployments and Other Activities 
        (970):
                    Fiscal year 2007:
                            (A) New budget authority, 
                        $124,153,000,000.
                            (B) Outlays, $31,935,000,000.
                    Fiscal year 2008:
                            (A) New budget authority, 
                        $145,162,000,000.
                            (B) Outlays, $115,179,000,000.
                    Fiscal year 2009:
                            (A) New budget authority, 
                        $50,000,000,000.
                            (B) Outlays, $109,830,000,000.
                    Fiscal year 2010:
                            (A) New budget authority, $0.
                            (B) Outlays, $41,722,000,000.
                    Fiscal year 2011:
                            (A) New budget authority, $0.
                            (B) Outlays, $13,551,000,000.
                    Fiscal year 2012:
                            (A) New budget authority, $0.
                            (B) Outlays, $4,505,000,000.

                        TITLE II--BUDGET PROCESS

SEC. 201. PAY-AS-YOU-GO POINT OF ORDER IN THE SENATE.

    (a) Point of Order.--
            (1) In general.--It shall not be in order in the 
        Senate to consider any direct spending or revenue 
        legislation that would increase the on-budget deficit 
        or cause an on-budget deficit for either of the 
        applicable time periods as measured in paragraphs (5) 
        and (6).
            (2) Applicable time periods.--For purposes of this 
        subsection, the term ``applicable time period'' means 
        either--
                    (A) the period of the current fiscal year, 
                the budget year, and the ensuing 4 fiscal years 
                following the budget year; or
                    (B) the period of the current fiscal year, 
                the budget year, and the ensuing 9 fiscal years 
                following the budget year.
            (3) Direct spending legislation.--For purposes of 
        this subsection and except as provided in paragraph 
        (4), the term ``direct spending legislation'' means any 
        bill, joint resolution, amendment, motion, or 
        conference report that affects direct spending as that 
        term is defined by, and interpreted for purposes of, 
        the Balanced Budget and Emergency Deficit Control Act 
        of 1985.
            (4) Exclusion.--For purposes of this subsection, 
        the terms ``direct spending legislation'' and ``revenue 
        legislation'' do not include--
                    (A) any concurrent resolution on the 
                budget; or
                    (B) any provision of legislation that 
                affects the full funding of, and continuation 
                of, the deposit insurance guarantee commitment 
                in effect on the date of enactment of the 
                Budget Enforcement Act of 1990.
            (5) Baseline.--Estimates prepared pursuant to this 
        subsection shall--
                    (A) use the baseline surplus or deficit 
                used for the most recently adopted concurrent 
                resolution on the budget; and
                    (B) be calculated under the requirements of 
                subsections (b) through (d) of section 257 of 
                the Balanced Budget and Emergency Deficit 
                Control Act of 1985 (as in effect prior to 
                September 30, 2002) for fiscal years beyond 
                those covered by that concurrent resolution on 
                the budget.
            (6) Prior surplus.--If direct spending or revenue 
        legislation increases the on-budget deficit or causes 
        an on-budget deficit when taken individually, it must 
        also increase the on-budget deficit or cause an on-
        budget deficit when taken together with all direct 
        spending and revenue legislation enacted since the 
        beginning of the calendar year not accounted for in the 
        baseline under paragraph (5)(A), except that direct 
        spending or revenue effects resulting in net deficit 
        reduction enacted in any bill pursuant to a 
        reconciliation instruction since the beginning of that 
        same calendar year shall never be made available on the 
        pay-as-you-go ledger and shall be dedicated only for 
        deficit reduction.
    (b) Supermajority Waiver and Appeals.--
            (1) Waiver.--This section may be waived or 
        suspended in the Senate only by the affirmative vote of 
        three-fifths of the Members, duly chosen and sworn.
            (2) Appeals.--Appeals in the Senate from the 
        decisions of the Chair relating to any provision of 
        this section shall be limited to 1 hour, to be equally 
        divided between, and controlled by, the appellant and 
        the manager of the bill or joint resolution, as the 
        case may be. An affirmative vote of three-fifths of the 
        Members of the Senate, duly chosen and sworn, shall be 
        required to sustain an appeal of the ruling of the 
        Chair on a point of order raised under this section.
    (c) Determination of Budget Levels.--For purposes of this 
section, the levels of new budget authority, outlays, and 
revenues for a fiscal year shall be determined on the basis of 
estimates made by the Senate Committee on the Budget.
    (d) Sunset.--This section shall expire on September 30, 
2017.
    (e) Repeal.--In the Senate, section 505 of H. Con. Res. 95 
(108th Congress), the fiscal year 2004 concurrent resolution on 
the budget, shall no longer apply.

SEC. 202. SENATE POINT OF ORDER AGAINST RECONCILIATION LEGISLATION THAT 
                    WOULD INCREASE THE DEFICIT OR REDUCE A SURPLUS.

    (a) In General.--It shall not be in order in the Senate to 
consider any reconciliation bill, resolution, amendment, 
amendment between Houses, motion, or conference report pursuant 
to section 310 of the Congressional Budget Act of 1974 that 
would cause or increase a deficit or reduce a surplus in either 
of the following periods:
            (1) The current fiscal year, the budget year, and 
        the ensuing 4 fiscal years following the budget year.
            (2) The current fiscal year, the budget year, and 
        the ensuing 9 fiscal years following the budget year.
    (b) Supermajority Waiver and Appeal in the Senate.--
            (1) Waiver.--This section may be waived or 
        suspended in the Senate only by an affirmative vote of 
        three-fifths of the Members, duly chosen and sworn.
            (2) Appeal.--An affirmative vote of three-fifths of 
        the Members of the Senate, 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 
        this section.
    (c) Determination of Budget Levels.--For purposes of this 
section, the levels of net deficit increases shall be 
determined on the basis of estimates provided by the Senate 
Committee on the Budget.

SEC. 203. SENATE POINT OF ORDER AGAINST LEGISLATION INCREASING LONG-
                    TERM DEFICITS.

    (a) Congressional Budget Office Analysis of Proposals.--The 
Director of the Congressional Budget Office shall, to the 
extent practicable, prepare for each bill and joint resolution 
reported from committee (except measures within the 
jurisdiction of the Committee on Appropriations), and 
amendments thereto and conference reports thereon, an estimate 
of whether the measure would cause, relative to current law, a 
net increase in deficits in excess of $5,000,000,000 in any of 
the four 10-year periods beginning in fiscal year 2018 through 
fiscal year 2057.
    (b) Point of Order.--It shall not be in order in the Senate 
to consider any bill, joint resolution, amendment, motion, or 
conference report that would cause a net increase in deficits 
in excess of $5,000,000,000 in any of the 4 10-year periods 
beginning in 2018 through 2057.
    (c) Supermajority Waiver and Appeal in the Senate.--
            (1) Waiver.--This section may be waived or 
        suspended only by the affirmative vote of three-fifths 
        of the Members, duly chosen and sworn.
            (2) Appeal.--An affirmative vote of three-fifths of 
        the Members, duly chosen and sworn, shall be required 
        to sustain an appeal of the ruling of the Chair on a 
        point of order raised under this section.
    (d) Determinations of Budget Levels.--For purposes of this 
section, the levels of net deficit increases shall be 
determined on the basis of estimates provided by the Senate 
Committee on the Budget.
    (e) Repeal.--In the Senate, section 407 of H. Con. Res. 95 
(109th Congress), the concurrent resolution on the budget for 
fiscal year 2006, shall no longer apply.
    (f) Sunset.--This section shall expire on September 30, 
2017.

SEC. 204. EMERGENCY LEGISLATION.

    (a) Senate.--
            (1) Authority to designate.--In the Senate, with 
        respect to a provision of direct spending or receipts 
        legislation or appropriations for discretionary 
        accounts that Congress designates as an emergency 
        requirement in such measure, the amounts of new budget 
        authority, outlays, and receipts in all fiscal years 
        resulting from that provision shall be treated as an 
        emergency requirement for the purpose of this 
        subsection.
            (2) Exemption of emergency provisions.--Any new 
        budget authority, outlays, and receipts resulting from 
        any provision designated as an emergency requirement, 
        pursuant to this subsection, in any bill, joint 
        resolution, amendment, or conference report shall not 
        count for purposes of sections 302 and 311 of the 
        Congressional Budget Act of 1974 and sections 201, 203, 
        and 207 of this resolution (relating to pay-as-you-go 
        in the Senate, long-term deficits, and discretionary 
        spending limits).
            (3) Designations.--If a provision of legislation is 
        designated as an emergency requirement under this 
        subsection, the committee report and any statement of 
        managers accompanying that legislation shall include an 
        explanation of the manner in which the provision meets 
        the criteria in paragraph (6).
            (4) Definitions.--In this subsection, the terms 
        ``direct spending'', ``receipts'', and ``appropriations 
        for discretionary accounts'' mean any provision of a 
        bill, joint resolution, amendment, motion, or 
        conference report that affects direct spending, 
        receipts, or appropriations as those terms have been 
        defined and interpreted for purposes of the Balanced 
        Budget and Emergency Deficit Control Act of 1985.
            (5) Point of order.--
                    (A) In general.--When the Senate is 
                considering a bill, resolution, amendment, 
                motion, or conference report, if a point of 
                order is made by a Senator against an emergency 
                designation in that measure, that provision 
                making such a designation shall be stricken 
                from the measure and may not be offered as an 
                amendment from the floor.
                    (B) Supermajority waiver and appeals.--
                            (i) Waiver.--Subparagraph (A) may 
                        be waived or suspended in the Senate 
                        only by an affirmative vote of three-
                        fifths of the Members, duly chosen and 
                        sworn.
                            (ii) Appeals.--Appeals in the 
                        Senate from the decisions of the Chair 
                        relating to any provision of this 
                        paragraph shall be limited to 1 hour, 
                        to be equally divided between, and 
                        controlled by, the appellant and the 
                        manager of the bill or joint 
                        resolution, as the case may be. An 
                        affirmative vote of three-fifths of the 
                        Members of the Senate, duly chosen and 
                        sworn, shall be required to sustain an 
                        appeal of the ruling of the Chair on a 
                        point of order raised under this 
                        paragraph.
                    (C) Definition of an emergency 
                designation.--For purposes of subparagraph (A), 
                a provision shall be considered an emergency 
                designation if it designates any item as an 
                emergency requirement pursuant to this 
                subsection.
                    (D) Form of the point of order.--A point of 
                order under subparagraph (A) may be raised by a 
                Senator as provided in section 313(e) of the 
                Congressional Budget Act of 1974.
                    (E) Conference reports.--When the Senate is 
                considering a conference report on, or an 
                amendment between the Houses in relation to, a 
                bill, upon a point of order being made by any 
                Senator pursuant to this subsection, and such 
                point of order being sustained, such material 
                contained in such conference report shall be 
                deemed stricken, and the Senate shall proceed 
                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. 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 
                paragraph), no further amendment shall be in 
                order.
            (6) Criteria.--
                    (A) In general.--For purposes of this 
                subsection, any provision is an emergency 
                requirement if the situation addressed by such 
                provision is--
                            (i) necessary, essential, or vital 
                        (not merely useful or beneficial);
                            (ii) sudden, quickly coming into 
                        being, and not building up over time;
                            (iii) an urgent, pressing, and 
                        compelling need requiring immediate 
                        action;
                            (iv) subject to subparagraph (B), 
                        unforeseen, unpredictable, and 
                        unanticipated; and
                            (v) not permanent, temporary in 
                        nature.
                    (B) Unforeseen.--An emergency that is part 
                of an aggregate level of anticipated 
                emergencies, particularly when normally 
                estimated in advance, is not unforeseen.
            (7) Repeal.--In the Senate, section 402 of H. Con. 
        Res. 95 (109th Congress), the concurrent resolution on 
        the budget for fiscal year 2006, shall no longer apply.
    (b) House.--In the House, if any bill or joint resolution, 
or amendment offered or considered as adopted or conference 
report thereon, that makes appropriations for discretionary 
amounts, and such amounts are designated as necessary to meet 
emergency needs, then the new budget authority and outlays 
resulting therefrom shall not be counted for the purposes of 
titles III and IV of the Congressional Budget Act of 1974.

SEC. 205. EXTENSION OF ENFORCEMENT OF BUDGETARY POINTS OF ORDER IN THE 
                    SENATE.

    Notwithstanding any provision of the Congressional Budget 
Act of 1974, subsections (c)(2) and (d)(3) of section 904 of 
the Congressional Budget Act of 1974 shall remain in effect for 
purposes of Senate enforcement through September 30, 2017, and 
Section 403 of H. Con. Res. 95 (109th Congress) shall no longer 
apply in the Senate.

SEC. 206. POINT OF ORDER AGAINST ADVANCE APPROPRIATIONS.

    (a) Senate.--
            (1) In general.--
                    (A) Point of order.--Except as provided in 
                paragraph (2), it shall not be in order in the 
                Senate to consider any bill, joint resolution, 
                motion, amendment, or conference report that 
                would provide an advance appropriation.
                    (B) Definition.--In this subsection, the 
                term ``advance appropriation'' means any new 
                budget authority provided in a bill or joint 
                resolution making appropriations for fiscal 
                year 2008 that first becomes available for any 
                fiscal year after 2008, or any new budget 
                authority provided in a bill or joint 
                resolution making general appropriations or 
                continuing appropriations for fiscal year 2009, 
                that first becomes available for any fiscal 
                year after 2009.
            (2) Exceptions.--Advance appropriations may be 
        provided--
                    (A) for fiscal years 2009 and 2010 for 
                programs, projects, activities, or accounts 
                identified in the joint explanatory statement 
                of managers accompanying this resolution under 
                the heading ``Accounts Identified for Advance 
                Appropriations'' in an aggregate amount not to 
                exceed $25,158,000,000 in new budget authority 
                in each year; and
                    (B) for the Corporation for Public 
                Broadcasting.
            (3) Supermajority waiver and appeal.--
                    (A) Waiver.--In the Senate, paragraph (1) 
                may be waived or suspended only by an 
                affirmative vote of three-fifths of the 
                Members, duly chosen and sworn.
                    (B) Appeal.--An affirmative vote of three-
                fifths of the Members of the Senate, duly 
                chosen and sworn, shall be required to sustain 
                an appeal of the ruling of the Chair on a point 
                of order raised under paragraph (1).
            (4) Form of point of order.--A point of order under 
        paragraph (1) may be raised by a Senator as provided in 
        section 313(e) of the Congressional Budget Act of 1974.
            (5) Conference reports.--When the Senate is 
        considering a conference report on, or an amendment 
        between the Houses in relation to, a bill, upon a point 
        of order being made by any Senator pursuant to this 
        subsection, and such point of order being sustained, 
        such material contained in such conference report shall 
        be deemed stricken, and the Senate shall proceed 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. 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.
            (6) Repeal.--In the Senate, section 401 of H. Con. 
        Res. 95 (109th Congress), the concurrent resolution on 
        the budget for fiscal year 2006, shall no longer apply.
    (b) House.--
            (1) In general.--In the House, except as provided 
        in paragraph (2), a bill or joint resolution making a 
        general appropriation or continuing appropriation, or 
        an amendment thereto may not provide for advance 
        appropriations.
            (2) Advance appropriation.--In the House, an 
        advance appropriation may be provided for fiscal year 
        2009 or 2010 for programs, projects, activities, or 
        accounts identified in the joint explanatory statement 
        of managers accompanying this resolution under the 
        heading ``Accounts Identified for Advance 
        Appropriations'' in an aggregate amount not to exceed 
        $25,558,000,000 in new budget authority.
            (3) Definition.--In this subsection, the term 
        ``advance appropriation'' means any new discretionary 
        budget authority provided in a bill or joint resolution 
        making general appropriations or any new discretionary 
        budget authority provided in a bill or joint resolution 
        continuing appropriations for fiscal year 2008 that 
        first becomes available for any fiscal year after 2008.

SEC. 207. DISCRETIONARY SPENDING LIMITS, PROGRAM INTEGRITY INITIATIVES, 
                    AND OTHER ADJUSTMENTS.

    (a) Senate Point of Order.--
            (1) In general.--Except as otherwise provided in 
        this section, it shall not be in order in the Senate to 
        consider any bill or joint resolution (or amendment, 
        motion, or conference report on that bill or joint 
        resolution) that would cause the discretionary spending 
        limits in this section to be exceeded.
            (2) Supermajority waiver and appeals.--
                    (A) Waiver.--This subsection may be waived 
                or suspended in the Senate only by the 
                affirmative vote of three-fifths of the 
                Members, duly chosen and sworn.
                    (B) Appeals.--Appeals in the Senate from 
                the decisions of the Chair relating to any 
                provision of this subsection shall be limited 
                to 1 hour, to be equally divided between, and 
                controlled by, the appellant and the manager of 
                the bill or joint resolution. An affirmative 
                vote of three-fifths of the Members of the 
                Senate, duly chosen and sworn, shall be 
                required to sustain an appeal of the ruling of 
                the Chair on a point of order raised under this 
                subsection.
    (b) Senate Discretionary Spending Limits.--In the Senate 
and as used in this section, the term ``discretionary spending 
limit'' means--
            (1) for fiscal year 2007, $950,504,000,000 in new 
        budget authority and $1,029,465,000,000 in outlays; and
            (2) for fiscal year 2008, $953,052,000,000 in new 
        budget authority and $1,028,397,000,000 in outlays;
as adjusted in conformance with the adjustment procedures in 
subsection (c).
    (c) Adjustments in the Senate.--
            (1) In general.--After the reporting of a bill or 
        joint resolution relating to any matter described in 
        paragraph (2), or the offering of an amendment thereto 
        or the submission of a conference report thereon--
                    (A) the Chairman of the Senate Committee on 
                the Budget may adjust the discretionary 
                spending limits, budgetary aggregates, and 
                allocations pursuant to section 302(a) of the 
                Congressional Budget Act of 1974, by the amount 
                of new budget authority in that measure for 
                that purpose and the outlays flowing therefrom; 
                and
                    (B) following any adjustment under 
                subparagraph (A), the Senate Committee on 
                Appropriations may report appropriately revised 
                suballocations pursuant to section 302(b) of 
                the Congressional Budget Act of 1974 to carry 
                out this subsection.
            (2) Matters described.--Matters referred to in 
        paragraph (1) are as follows:
                    (A) Continuing disability reviews and ssi 
                redeterminations.--If a bill or joint 
                resolution is reported making appropriations 
                for fiscal year 2008 that appropriates 
                $264,000,000 for continuing disability reviews 
                and Supplemental Security Income 
                redeterminations for the Social Security 
                Administration, and provides an additional 
                appropriation of up to $213,000,000 for 
                continuing disability reviews and Supplemental 
                Security Income redeterminations for the Social 
                Security Administration, then the discretionary 
                spending limits, allocation to the Senate 
                Committee on Appropriations, and aggregates may 
                be adjusted by the amounts provided in such 
                legislation for that purpose, but not to exceed 
                $213,000,000 in budget authority and outlays 
                flowing therefrom for fiscal year 2008.
                    (B) Internal revenue service tax 
                enforcement.--If a bill or joint resolution is 
                reported making appropriations for fiscal year 
                2008 that appropriates $6,822,000,000 for the 
                Internal Revenue Service for enhanced tax 
                enforcement to address the Federal tax gap 
                (taxes owed but not paid) and provides an 
                additional appropriation of up to $406,000,000 
                for the Internal Revenue Service for enhanced 
                tax enforcement to address the Federal tax gap, 
                then the discretionary spending limits, 
                allocation to the Senate Committee on 
                Appropriations, and aggregates may be adjusted 
                by the amounts provided in such legislation for 
                that purpose, but not to exceed $406,000,000 in 
                budget authority and outlays flowing therefrom 
                for fiscal year 2008.
                    (C) Health care fraud and abuse control.--
                If a bill or joint resolution is reported 
                making appropriations for fiscal year 2008 that 
                appropriates up to $383,000,000 to the Health 
                Care Fraud and Abuse Control program at the 
                Department of Health and Human Services, then 
                the discretionary spending limits, allocation 
                to the Senate Committee on Appropriations, and 
                aggregates may be adjusted by the amounts 
                provided in such legislation for that purpose, 
                but not to exceed $383,000,000 in budget 
                authority and outlays flowing therefrom for 
                fiscal year 2008.
                    (D) Unemployment insurance improper payment 
                reviews.--If a bill or joint resolution is 
                reported making appropriations for fiscal year 
                2008 that appropriates $10,000,000 for in-
                person reemployment and eligibility assessments 
                and unemployment insurance improper payment 
                reviews, and provides an additional 
                appropriation of up to $40,000,000 for in-
                person reemployment and eligibility assessments 
                and unemployment insurance improper payment 
                reviews, then the discretionary spending 
                limits, allocation to the Senate Committee on 
                Appropriations, and aggregates may be adjusted 
                by the amounts provided in such legislation for 
                that purpose, but not to exceed $40,000,000 in 
                budget authority and outlays flowing therefrom 
                for fiscal year 2008.
                    (E) Costs of overseas deployments and 
                related activities.--The Chairman of the Senate 
                Committee on the Budget may adjust the 
                discretionary spending limits, allocation to 
                the Senate Committee on Appropriations, and 
                aggregates for one or more bills, joint 
                resolutions, motions, amendments, or conference 
                reports making appropriations for fiscal year 
                2008 for overseas deployments and related 
                activities, by the amounts provided in such 
                legislation for that purpose (and so designated 
                pursuant to this subparagraph) up to the 
                amounts of budget authority specified in 
                Section 103(21) for fiscal year 2008 and the 
                new outlays flowing therefrom.
    (d) House.--
            (1) Program integrity initiatives and other 
        adjustments.--
                    (A) Continuing disability reviews and 
                supplemental security income 
                redeterminations.--If a bill or joint 
                resolution is reported making appropriations 
                for fiscal year 2008 that appropriates 
                $264,000,000 for continuing disability reviews 
                and Supplemental Security Income 
                redeterminations for the Social Security 
                Administration, and provides an additional 
                appropriation of up to $213,000,000 and the 
                amount is designated for continuing disability 
                reviews and Supplemental Security Income 
                redeterminations for the Social Security 
                Administration, then the allocation to the 
                Committee on Appropriations of the House of 
                Representatives shall be increased by the 
                amount of the additional budget authority and 
                outlays flowing from that budget authority for 
                fiscal year 2008.
                    (B) Internal revenue service tax 
                compliance.--If a bill or joint resolution is 
                reported making appropriations for fiscal year 
                2008 that appropriates $6,822,000,000 to the 
                Internal Revenue Service and the amount is 
                designated to improve compliance with the 
                provisions of the Internal Revenue Code of 1986 
                and provides an additional appropriation of up 
                to $406,000,000, and the amount is designated 
                to improve compliance with the provisions of 
                the Internal Revenue Code of 1986, then the 
                allocation to the Committee on Appropriations 
                of the House of Representatives shall be 
                increased by the amount of the additional 
                budget authority and outlays flowing from that 
                budget authority for fiscal year 2008.
                    (C) Health care fraud and abuse control 
                program.--If a bill or joint resolution is 
                reported making appropriations for fiscal year 
                2008 that appropriates up to $383,000,000 and 
                the amount is designated to the Health Care 
                Fraud and Abuse Control program at the 
                Department of Health and Human Services, then 
                the allocation to the Committee on 
                Appropriations of the House of Representatives 
                shall be increased by the amount of additional 
                budget authority and outlays flowing from that 
                budget authority for fiscal year 2008.
                    (D) Unemployment insurance improper payment 
                reviews.--If a bill or joint resolution is 
                reported making appropriations for fiscal year 
                2008 that appropriates $10,000,000 for in-
                person reemployment and eligibility assessments 
                and unemployment insurance improper payment 
                reviews, and provides an additional 
                appropriation of up to $40,000,000 for in-
                person reemployment and eligibility assessments 
                and unemployment insurance improper payment 
                reviews, then the allocation to the Committee 
                on Appropriations and aggregates may be 
                adjusted by the amounts provided in such 
                legislation for that purpose, but not to exceed 
                $40,000,000 in budget authority and outlays 
                flowing therefrom for fiscal year 2008.
                    (E) Costs of overseas deployments and 
                related activities.--
                            (i) In the House, if one or more 
                        bills or joint resolutions are reported 
                        making appropriations for fiscal year 
                        2008 for overseas deployments and 
                        related activities (and such amounts 
                        are so designated pursuant to this 
                        clause), then the allocation to the 
                        House Committee on Appropriations and 
                        aggregates may be adjusted by the 
                        amounts provided in such legislation 
                        for that purpose up to the amounts of 
                        budget authority specified in section 
                        103(21) for fiscal year 2008 and the 
                        new outlays flowing therefrom.
                            (ii) In the House, if one or more 
                        bills or joint resolutions are reported 
                        making appropriations for fiscal year 
                        2008 for overseas deployments and 
                        related activities (and such amounts 
                        are so designated pursuant to this 
                        clause) above the amounts of budget 
                        authority and new outlays specified in 
                        clause (i), then new budget authority, 
                        outlays, or receipts resulting 
                        therefrom shall not count for the 
                        purposes of titles III and IV of the 
                        Congressional Budget Act of 1974.
            (2) Procedure for adjustments.--
                    (A) In general.--After the reporting of a 
                bill or joint resolution, or an amendment 
                offered or considered as adopted thereto, or 
                the submission of a conference report thereon, 
                the Chairman of the Committee on the Budget 
                shall make adjustments set forth in paragraph 
                (1) for the incremental new budget authority in 
                that measure and the outlays flowing from that 
                budget authority, if that measure meets the 
                requirements set forth in paragraph (1), except 
                that no adjustment shall be made for provisions 
                exempted for the purposes of titles III and IV 
                of the Congressional Budget Act of 1974 under 
                paragraph (1)(E)(ii).
                    (B) Matters to be adjusted.--The 
                adjustments referred to in subparagraph (A) are 
                to be made to--
                            (i) the allocations made pursuant 
                        to the appropriate concurrent 
                        resolution on the budget pursuant to 
                        section 302(a) of the Congressional 
                        Budget Act of 1974; and
                            (ii) the budgetary aggregates as 
                        set forth in this resolution.
    (e) Oversight of Government Performance.--In the House and 
the Senate, all committees are directed to review programs 
within their jurisdictions to root out waste, fraud, and abuse 
in program spending, giving particular scrutiny to issues 
raised by Government Accountability Office reports. Based on 
these oversight efforts and committee performance reviews of 
programs within their jurisdictions, committees are directed to 
include recommendations for improved governmental performance 
in their annual views and estimates reports required under 
section 301(d) of the Congressional Budget Act of 1974 to the 
Committees on the Budget.
    (f) Supplemental Appropriations for Fiscal Year 2007.--If 
legislation making supplemental appropriations for fiscal year 
2007 is enacted, the Chairman of the appropriate Committee on 
the Budget shall make the appropriate adjustments in 
allocations, aggregates, discretionary spending limits, and 
other levels of new budget authority and outlays to reflect the 
difference between such measure and the corresponding levels 
assumed in this resolution.

SEC. 208. APPLICATION OF PREVIOUS ALLOCATIONS IN THE SENATE.

    Section 7035 of Public Law 109-234 shall no longer apply in 
the Senate.

SEC. 209. SENATE POINT OF ORDER AGAINST PROVISIONS OF APPROPRIATIONS 
                    LEGISLATION THAT CONSTITUTE CHANGES IN MANDATORY 
                    PROGRAMS WITH NET COSTS.

    (a) In General.--In the Senate, it shall not be in order to 
consider any appropriations legislation, including any 
amendment thereto, motion in relation thereto, or conference 
report thereon, that includes any provision which constitutes a 
change in a mandatory program producing net costs, as defined 
in subsection (b), that would have been estimated as affecting 
direct spending or receipts under section 252 of the Balanced 
Budget and Emergency Deficit Control Act of 1985 (as in effect 
prior to September 30, 2002) were they included in legislation 
other than appropriations legislation. A point of order 
pursuant to this section shall be raised against such provision 
or provisions as described in subsections (e) and (f).
    (b) Changes in Mandatory Programs Producing Net Costs.--A 
provision or provisions shall be subject to a point of order 
pursuant to this section if--
            (1) the provision would increase budget authority 
        in at least 1 of the 9 fiscal years that follow the 
        budget year and over the period of the total of the 
        budget year and the 9 fiscal years following the budget 
        year;
            (2) the provision would increase net outlays over 
        the period of the total of the 9 fiscal years following 
        the budget year; and
            (3) the sum total of all changes in mandatory 
        programs in the legislation would increase net outlays 
        as measured over the period of the total of the 9 
        fiscal years following the budget year.
    (c) Determination.--The determination of whether a 
provision is subject to a point of order pursuant to this 
section shall be made by the Committee on the Budget of the 
Senate.
    (d) Supermajority Waiver and Appeal.--This section may be 
waived or suspended in the Senate only by an affirmative vote 
of three-fifths of the Members, duly chosen and sworn. An 
affirmative vote of three-fifths of the Members of the Senate, 
duly chosen and sworn, shall be required to sustain an appeal 
of the ruling of the Chair on a point of order raised under 
this section.
    (e) General Point of Order.--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 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) against which the Senator raised 
the point of order, then only those provisions (including 
provision of an amendment, motion, or conference report) 
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 
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.
    (f) Form of the Point of Order.--When the Senate is 
considering a conference report on, or an amendment between the 
Houses in relation to, a bill, upon a point of order being made 
by any Senator pursuant to this section, and such point of 
order being sustained, such material contained in such 
conference report or amendment shall be deemed stricken, and 
the Senate shall proceed 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 shall be debatable. 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.
    (g) Effectiveness.--This section shall not apply to--
            (1) legislation making supplemental appropriations 
        for fiscal year 2007; and
            (2) any provision constituting a change in a 
        mandatory program in appropriations legislation if such 
        provision has been enacted in each of the 3 fiscal 
        years prior to the budget year.

SEC. 210. COMPLIANCE WITH SECTION 13301 OF THE BUDGET ENFORCEMENT ACT 
                    OF 1990.

    (a) In General.--In the House and the Senate, 
notwithstanding section 302(a)(1) of the Congressional Budget 
Act of 1974 and section 13301 of the Budget Enforcement Act of 
1990, the joint explanatory statement accompanying the 
conference report on any concurrent resolution on the budget 
shall include in its allocation under section 302(a) of the 
Congressional Budget Act of 1974 to the Committee on 
Appropriations amounts for the discretionary administrative 
expenses of the Social Security Administration.
    (b) Special Rule.--In the House, for purposes of applying 
section 302(f) of the Congressional Budget Act of 1974, 
estimates of the level of total new budget authority and total 
outlays provided by a measure shall include any discretionary 
amounts provided for the Social Security Administration.

SEC. 211. APPLICATION AND EFFECT OF CHANGES IN ALLOCATIONS AND 
                    AGGREGATES.

    (a) Application.--Any adjustments of allocations and 
aggregates made pursuant to this resolution shall--
            (1) apply while that measure is under 
        consideration;
            (2) take effect upon the enactment of that measure; 
        and
            (3) be published in the Congressional Record as 
        soon as practicable.
    (b) Effect of Changed Allocations and Aggregates.--Revised 
allocations and aggregates resulting from these adjustments 
shall be considered for the purposes of the Congressional 
Budget Act of 1974 as allocations and aggregates contained in 
this resolution.
    (c) Budget Committee Determinations.--For purposes of this 
resolution the levels of new budget authority, outlays, direct 
spending, new entitlement authority, revenues, deficits, and 
surpluses for a fiscal year or period of fiscal years shall be 
determined on the basis of estimates made by the appropriate 
Committee on the Budget.

SEC. 212. ADJUSTMENTS TO REFLECT CHANGES IN CONCEPTS AND DEFINITIONS.

    Upon the enactment of a bill or joint resolution providing 
for a change in concepts or definitions, the Chairman of the 
appropriate Committee on the Budget may make adjustments to the 
levels and allocations in this resolution in accordance with 
section 251(b) of the Balanced Budget and Emergency Deficit 
Control Act of 1985 (as in effect prior to September 30, 2002).

SEC. 213. EXERCISE OF RULEMAKING POWERS.

    Congress adopts the provisions of this title--
            (1) as an exercise of the rulemaking power of the 
        Senate and House of Representatives, respectively, and 
        as such they shall be considered as part of the rules 
        of each House or of that House to which they 
        specifically apply, and such rules shall supersede 
        other rules only to the extent that they are 
        inconsistent with such other rules; and
            (2) with full recognition of the constitutional 
        right of either the Senate or House of Representatives 
        to change those rules (insofar as they relate to that 
        House) at any time, in the same manner, and to the same 
        extent as is the case of any other rule of the Senate 
        or House of Representatives.

                        TITLE III--RESERVE FUNDS

SEC. 301. DEFICIT-NEUTRAL RESERVE FUND FOR SCHIP LEGISLATION.

    (a) Senate.--
            (1) Priority.--The Senate establishes the following 
        priorities and makes the following findings:
                    (A) The Senate shall make the enactment of 
                legislation to reauthorize the State Children's 
                Health Insurance Program (SCHIP) a top priority 
                for the remainder of fiscal year 2007, during 
                the first session of the 110th Congress.
                    (B) Extending health care coverage to the 
                Nation's vulnerable uninsured children is an 
                urgent priority for the Senate.
                    (C) SCHIP has proven itself a successful 
                program for covering previously uninsured 
                children.
                    (D) More than 6 million children are 
                enrolled in this landmark program, which has 
                enjoyed broad bipartisan support in Congress, 
                among our Nation's governors, and within state 
                and local governments.
                    (E) SCHIP reduces the percentage of 
                children with unmet health care needs.
                    (F) Since SCHIP was created, enormous 
                progress has been made in reducing disparities 
                in children's coverage rates.
                    (G) Uninsured children who gain coverage 
                through SCHIP receive more preventive care and 
                their parents report better access to providers 
                and improved communications with their 
                children's doctors.
                    (H) Congress has a responsibility to 
                reauthorize SCHIP before the expiration of its 
                current authorization.
            (2) Reserve fund.--In the Senate, the Chairman of 
        the Senate Committee on the Budget may revise the 
        allocations, aggregates, and other appropriate levels 
        in this resolution for a bill, joint resolution, 
        amendment, motion, or conference report that provides 
        up to $50,000,000,000 in outlays over the period of the 
        total of fiscal years 2007 through 2012 for 
        reauthorization of the State Children's Health 
        Insurance Program (SCHIP), if such legislation 
        maintains coverage for those currently enrolled in 
        SCHIP, continues efforts to enroll uninsured children 
        who are already eligible for SCHIP or Medicaid but are 
        not enrolled, or supports States in their efforts to 
        move forward in covering more children, by the amounts 
        provided in that legislation for those purposes, 
        provided that the outlay adjustment shall not exceed 
        $50,000,000,000 in outlays over the period of the total 
        of fiscal years 2007 through 2012, and provided that 
        such legislation would not increase the deficit over 
        either the period of the total of fiscal years 2007 
        through 2012 or the period of the total of fiscal years 
        2007 through 2017.
    (b) House Reserve Fund for the State Children's Health 
Insurance Program.--The Chairman of the House Committee on the 
Budget may revise the allocations of a committee or committees, 
aggregates, and other appropriate levels for bills, joint 
resolutions, amendments, or conference reports, which contains 
matter within the jurisdiction of the Committee on Energy and 
Commerce that expands coverage and improves children's health 
through the State Children's Health Insurance Program (SCHIP) 
under title XXI of the Social Security Act and the program 
under title XIX of such Act (commonly known as Medicaid) and 
that increases new budget authority that will result in not 
more than $50,000,000,000 in outlays in fiscal years 2007 
through 2012, and others which contain offsets so designated 
for the purpose of this section within the jurisdiction of 
another committee or committees, if the combined changes would 
not increase the deficit or decrease the surplus for the total 
over the period of fiscal years 2007 through 2012 or the period 
of fiscal years 2007 through 2017.

SEC. 302. DEFICIT-NEUTRAL RESERVE FUND FOR VETERANS AND WOUNDED 
                    SERVICEMEMBERS.

    The Chairman of the appropriate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports which--
            (1) enhance medical care and disability benefits 
        for wounded or disabled military personnel or veterans, 
        which may include low-vision and blinded veterans;
            (2) expand eligibility for Combat-Related Special 
        Compensation to permit additional disabled retirees to 
        receive both disability compensation and retired pay;
            (3) eliminate the offset between Survivor Benefit 
        Plan annuities and veterans' dependency and indemnity 
        compensation;
            (4) improve disability evaluations of military 
        personnel or veterans to expedite the claims process;
            (5) enhance educational benefits of veterans; or
            (6) provide for or increase benefits to Filipino 
        veterans of World War II, their survivors and 
        dependents;
by the amounts provided in such legislation for those purposes 
(or, in the House, that contain offsets so designated for those 
purposes), provided in the Senate that such legislation would 
not increase the deficit over either the period of the total of 
fiscal years 2007 through 2012 or the period of the total of 
fiscal years 2007 through 2017, and provided further in the 
House that such legislation would not increase the deficit or 
decrease the surplus for the total over the period of fiscal 
years 2007 through 2012 or the period of fiscal years 2007 
through 2017.

SEC. 303. DEFICIT-NEUTRAL RESERVE FUND FOR TAX RELIEF.

    (a) Senate.--In the Senate, the Chairman of the Senate 
Committee on the Budget may revise the aggregates, allocations, 
and other appropriate levels in this resolution for one or more 
bills, joint resolutions, amendments, motions, or conference 
reports that would provide tax relief, including extensions of 
expiring tax relief and refundable tax relief, by the amounts 
provided in that legislation for those purposes, provided that 
such legislation would not increase the deficit over either the 
period of the total of fiscal years 2007 through 2012 or the 
period of the total of fiscal years 2007 through 2017.
    (b) House.--
            (1) Reserve fund for reform of the alternative 
        minimum tax.--The Chairman of the House Committee on 
        the Budget may revise the allocations of a committee or 
        committees, aggregates, and other appropriate levels in 
        this resolution for one or more bills, joint 
        resolutions, amendments, motions, or conference reports 
        that provide for reform of the Internal Revenue Code of 
        1986 by reducing the tax burden of the alternative 
        minimum tax on middle-income families by the amounts 
        provided in such legislation for that purpose or that 
        contain offsets so designated for that purpose, 
        provided that such legislation would not increase the 
        deficit or decrease the surplus for the total over the 
        period of fiscal years 2007 through 2012 or the period 
        of fiscal years 2007 through 2017.
            (2) Reserve fund to provide for middle-income tax 
        relief and economic equity.--The Chairman of the House 
        Committee on the Budget may revise the allocations of a 
        committee or committees, aggregates, and other 
        appropriate levels in this resolution for one or more 
        bills, joint resolutions, amendments, motions, or 
        conference reports that provide for tax relief for 
        middle-income families and taxpayers and enhanced 
        economic equity, such as extension of the child tax 
        credit, extension of marriage penalty relief, extension 
        of the 10 percent individual income tax bracket, 
        modification of the Alternative Minimum Tax, 
        elimination of estate taxes on all but a minute 
        fraction of estates by reforming and substantially 
        increasing the unified credit, extension of the 
        research and experimentation tax credit, extension of 
        the deduction for State and local sales taxes, and a 
        tax credit for school construction bonds, by the 
        amounts provided in such legislation for those purposes 
        or that contain offsets so designated for those 
        purposes, provided that such legislation would not 
        increase the deficit or decrease the surplus for the 
        total over the period of fiscal years 2007 through 2012 
        or the period of fiscal years 2007 through 2017.

SEC. 304. DEFICIT-NEUTRAL RESERVE FUND FOR MEDICARE IMPROVEMENTS.

    (a) House.--The Chairman of the House Committee on the 
Budget may revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports that improve the Medicare program for 
beneficiaries and protect access to care, through measures such 
as increasing the reimbursement rate for physicians while 
protecting beneficiaries from associated premium increases and 
making improvements to the prescription drug program under part 
D by the amounts provided in such legislation for those 
purposes or that contain offsets so designated for those 
purposes, provided that such legislation would not increase the 
deficit or decrease the surplus for the total over the period 
of fiscal years 2007 through 2012 or the period of fiscal years 
2007 through 2017.
    (b) Senate.--
            (1) Prescription drugs.--In the Senate, the 
        Chairman of the Senate Committee on the Budget may 
        revise the aggregates, allocations, and other 
        appropriate levels in this resolution for a bill, joint 
        resolution, amendment, motion, or conference report 
        that repeals the prohibition in section 1860D-11(i)(1) 
        of the Social Security Act (42 U.S.C. 1395w-111(i)(1)) 
        while preserving access to prescription drugs and price 
        competition without requiring a particular formulary or 
        instituting a price structure for reimbursement of 
        covered Part D drugs, provided that such legislation 
        would not increase the deficit over either the period 
        of the total of fiscal years 2007 through 2012 or the 
        period of the total of fiscal years 2007 through 2017, 
        and provided further that any savings from the measure 
        are to be used either to improve the Medicare Part D 
        benefit or for deficit reduction.
            (2) Physician payments.--In the Senate, the 
        Chairman of the Senate Committee on the Budget may 
        revise the aggregates, allocations, and other 
        appropriate levels in this resolution for a bill, joint 
        resolution, amendment, motion, or conference report 
        that increases the reimbursement rate for physician 
        services under section 1848(d) of the Social Security 
        Act and that includes financial incentives for 
        physicians to improve the quality and efficiency of 
        items and services furnished to Medicare beneficiaries 
        through the use of consensus-based quality measures, by 
        the amounts provided in such legislation for that 
        purpose, provided that such legislation would not 
        increase the deficit over either the period of the 
        total of fiscal years 2007 through 2012 or the period 
        of the total of fiscal years 2007 through 2017.
            (3) Improvements to medicare part d.--In the 
        Senate, the Chairman of the Senate Committee on the 
        Budget may revise the aggregates, allocations, and 
        other appropriate levels in this resolution for a bill, 
        joint resolution, amendment, motion, or conference 
        report that makes improvements to the prescription drug 
        benefit under Medicare Part D, by the amounts provided 
        in such legislation for that purpose up to 
        $5,000,000,000, provided that such legislation would 
        not increase the deficit over either the period of the 
        total of fiscal years 2007 through 2012 or the period 
        of the total of fiscal years 2007 through 2017.
            (4) Improving medicare hospital payments.--In the 
        Senate, the Chairman of the Senate Committee on the 
        Budget may revise the allocations, aggregates, and 
        other appropriate levels in this resolution for a bill, 
        joint resolution, amendment, motion, or conference 
        report that--
                    (A) includes provisions to reform the area 
                wage index used to adjust payments to hospitals 
                under the Medicare hospital inpatient 
                prospective payment system under section 
                1886(d) of the Social Security Act (42 U.S.C. 
                1395ww(d)); and
                    (B) includes a transition to the reform 
                described in subparagraph (A);
        provided that such legislation would not increase the 
        deficit over either the period of the total of fiscal 
        years 2007 through 2012 or the period of the total of 
        fiscal years 2007 through 2017.
    (c) Senate and House Deficit-Neutral Reserve Fund To 
Address Physician and Other Health Care Provider Shortages.--
The Chairman of the appropriate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports that encourage physicians to train in 
primary care residencies and attract more physicians and other 
health care providers to States that face a shortage of health 
care providers by the amounts provided in such legislation for 
those purposes (or, in the House, that contain offsets so 
designated for those purposes), provided in the Senate that 
such legislation would not increase the deficit over either the 
period of the total of fiscal years 2007 through 2012 or the 
period of the total of fiscal years 2007 through 2017, and 
provided further in the House that such legislation would not 
increase the deficit or decrease the surplus for the total over 
the period of fiscal years 2007 through 2012 or the period of 
fiscal years 2007 through 2017.

SEC. 305. DEFICIT NEUTRAL RESERVE FUNDS FOR HEALTH CARE QUALITY, 
                    EFFECTIVENESS, EFFICIENCY, AND TRANSPARENCY.

    (a) Health Information Technology.--
            (1) The Chairman of the appropriate Committee on 
        the Budget may revise the allocations of a committee or 
        committees, aggregates, and other appropriate levels in 
        this resolution for one or more bills, joint 
        resolutions, amendments, motions, or conference reports 
        that provide incentives or other support for adoption 
        of modern information technology to improve quality and 
        protect privacy in health care, by the amounts provided 
        in such legislation for that purpose (or, in the House, 
        that contain offsets so designated for that purpose), 
        provided in the Senate that such legislation would not 
        increase the deficit over either the period of the 
        total of fiscal years 2007 through 2012 or the period 
        of the total of fiscal years 2007 through 2017, and 
        provided further in the House that such legislation 
        would not increase the deficit or decrease the surplus 
        for the total over the period of fiscal years 2007 
        through 2012 or the period of fiscal years 2007 through 
        2017.
            (2) The Chairman of the appropriate Committee on 
        the Budget may revise the allocations of a committee or 
        committees, aggregates, and other appropriate levels in 
        this resolution for one or more bills, joint 
        resolutions, amendments, motions, or conference reports 
        that provide incentives for Medicare providers or 
        suppliers to comply with, where available and medically 
        appropriate, clinical protocols identified as best 
        practices, by the amounts provided in such legislation 
        for that purpose (or, in the House, that contain 
        offsets so designated for that purpose), provided in 
        the Senate that such legislation would not increase the 
        deficit over either the period of the total of fiscal 
        years 2007 through 2012 or the period of the total of 
        fiscal years 2007 through 2017, and provided further in 
        the House that such legislation would not increase the 
        deficit or decrease the surplus for the total over the 
        period of fiscal years 2007 through 2012 or the period 
        of fiscal years 2007 through 2017.
    (b) Comparative Effectiveness Research.--The Chairman of 
the appropriate Committee on the Budget may revise the 
allocations of a committee or committees, aggregates, and other 
appropriate levels in this resolution for one or more bills, 
joint resolutions, amendments, motions, or conference reports 
that establish a new Federal or public-private initiative for 
comparative effectiveness research, by the amounts provided in 
such legislation for that purpose (or, in the House, that 
contain offsets so designated for that purpose), provided in 
the Senate that such legislation would not increase the deficit 
over either the period of the total of fiscal years 2007 
through 2012 or the period of the total of fiscal years 2007 
through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.
    (c) Improving the Health Care System.--In the Senate, the 
Chairman of the Senate Committee on the Budget may revise the 
allocations, aggregates, and other levels in this resolution 
for a bill, joint resolution, motion, amendment, or conference 
report that--
            (1) creates a framework and parameters for the use 
        of Medicare data for the purpose of conducting 
        research, public reporting, and other activities to 
        evaluate health care safety, effectiveness, efficiency, 
        quality, and resource utilization in Federal programs 
        and the private health care system; and
            (2) includes provisions to protect beneficiary 
        privacy and to prevent disclosure of proprietary or 
        trade secret information with respect to the transfer 
        and use of such data;
provided that such legislation would not increase the deficit 
over either the period of the total of fiscal years 2007 
through 2012 or the period of the total of fiscal years 2007 
through 2017.

SEC. 306. DEFICIT-NEUTRAL RESERVE FUND FOR HIGHER EDUCATION.

    (a) Senate.--In the Senate, the Chairman of the Senate 
Committee on the Budget may revise the aggregates, allocations, 
and other appropriate levels in this resolution for one or more 
bills, joint resolutions, amendments, motions, or conference 
reports that would make higher education more accessible and 
more affordable, which may include tax benefits, by the amounts 
provided in such legislation for that purpose, provided that 
such legislation would not increase the deficit over either the 
period of the total of fiscal years 2007 through 2012 or the 
period of the total of fiscal years 2007 through 2017.
    (b) House.--The Chairman of the House Committee on the 
Budget may revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports that make college more affordable through 
reforms to the Higher Education Act of 1965 or other 
legislation by the amounts provided in such legislation for 
that purpose or that contain offsets so designated for that 
purpose, provided that such legislation would not increase the 
deficit or decrease the surplus for the total over the period 
of fiscal years 2007 through 2012 or the period of fiscal years 
2007 through 2017.

SEC. 307. DEFICIT-NEUTRAL RESERVE FUND FOR THE FARM BILL.

    (a) Senate.--The Chairman of the Senate Committee on the 
Budget may revise the allocations, aggregates, and other 
appropriate levels in this resolution for one or more bills, 
joint resolutions, amendments, motions, or conference reports 
that provide for the reauthorization of the programs of the 
Food Security and Rural Investment Act of 2002 or prior Acts, 
authorize similar or related programs, provide for revenue 
changes, or any combination of the preceding purposes, by the 
amounts provided in such legislation for those purposes up to 
$20,000,000,000 over the period of the total of fiscal years 
2007 through 2012, provided that such legislation would not 
increase the deficit over either the period of the total of 
fiscal years 2007 through 2012 or the period of the total of 
fiscal years 2007 through 2017.
    (b) House.--The Chairman of the House Committee on the 
Budget may revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports that provide for the reauthorization of the 
programs of the Food Security and Rural Investment Act of 2002 
or prior Acts, authorize similar or related programs, or both, 
by the amounts provided in such legislation for those purposes 
or that contain offsets so designated for those purposes up to 
$20,000,000,000 for the total over the period of fiscal years 
2007 through 2012, provided that such legislation would not 
increase the deficit or decrease the surplus for the total over 
the period of fiscal years 2007 through 2012 or the period of 
fiscal years 2007 through 2017.

SEC. 308. DEFICIT-NEUTRAL RESERVE FUND FOR ENERGY LEGISLATION.

    (a) Senate.--In the Senate, the Chairman of the Senate 
Committee on the Budget may revise the allocations, aggregates, 
and other appropriate levels and limits in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports that would reduce our Nation's dependence on 
foreign sources of energy, expand production and use of clean 
alternative fuels and alternative fuel vehicles, promote 
renewable energy development, improve electricity transmission, 
encourage responsible development of domestic oil and natural 
gas resources, or reward conservation and efficiency, by the 
amounts provided in that legislation for those purposes, 
provided that such legislation would not increase the deficit 
over either the period of the total of fiscal years 2007 
through 2012 or the period of the total of fiscal years 2007 
through 2017. The legislation may include tax legislation such 
as a proposal to extend energy tax incentives like the 
production tax credit for electricity produced from renewable 
resources, the Clean Renewable Energy Bond program, or 
provisions to encourage energy efficient buildings, products, 
and power plants.
    (b) House.--
            (1) The Chairman of the House Committee on the 
        Budget shall revise the allocations of a committee or 
        committees, aggregates, and other appropriate levels in 
        this resolution for one or more bills, joint 
        resolutions, amendments, motions, or conference reports 
        that fulfill the purposes of section 301(a) of H.R. 6, 
        the Clean Energy Act of 2007 by the amounts provided in 
        such legislation for those purposes or that contain 
        offsets so designated for those purposes, provided that 
        such legislation would not increase the deficit or 
        decrease the surplus for the total over the period of 
        fiscal years 2007 through 2012 or the period of fiscal 
        years 2007 through 2017.
            (2) The Chairman of the House Committee on the 
        Budget shall revise the allocations provided for under 
        section 302(a) of the Congressional Budget Act of 1974 
        to the Committee on Appropriations to the extent that 
        any bills, joint resolutions, amendments, motions, or 
        conference reports provide budget authority for 
        purposes set forth in section 301(a) of H.R. 6 in 
        excess of the amounts provided for those purposes in 
        fiscal year 2007. Any adjustments made under this 
        paragraph shall not include revenues attributable to 
        changes in the Internal Revenue Code of 1986 and shall 
        not exceed the receipts estimated by the Congressional 
        Budget Office that are attributable to H.R. 6 for the 
        year in which the adjustments are made.

SEC. 309. DEFICIT-NEUTRAL RESERVE FUND FOR COUNTY PAYMENTS LEGISLATION.

    The Chairman of the appropriate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other appropriate levels and limits in this 
resolution for one or more bills, joint resolutions, 
amendments, motions, or conference reports that provide for the 
reauthorization of the Secure Rural Schools and Community Self-
Determination Act of 2000 (Public Law 106-393), make changes to 
the Payments in Lieu of Taxes Act of 1976 (Public Law 94-565), 
or both, by the amounts provided by that legislation for those 
purposes (or, in the House, that contain offsets so designated 
for those purposes), provided in the Senate that such 
legislation would not increase the deficit over either the 
period of the total of fiscal years 2007 through 2012 or the 
period of the total of fiscal years 2007 through 2017, and 
provided further in the House that such legislation would not 
increase the deficit or decrease the surplus for the total over 
the period of fiscal years 2007 through 2012 or the period of 
fiscal years 2007 through 2017.

SEC. 310. DEFICIT-NEUTRAL RESERVE FUND FOR TERRORISM RISK INSURANCE 
                    REAUTHORIZATION.

    The Chairman of the appropriate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other levels in this resolution for one or more 
bills, joint resolutions, amendments, motions, or conference 
reports that provide for a continued Federal role in ensuring 
the availability of terrorism insurance after the expiration of 
the Terrorism Risk Insurance Extension Act, by the amounts 
provided in such legislation for that purpose (or, in the 
House, that contain offsets so designated for that purpose), 
provided in the Senate that such legislation would not increase 
the deficit over either the period of the total of fiscal years 
2007 through 2012 or the period of the total of fiscal years 
2007 through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.

SEC. 311. DEFICIT-NEUTRAL RESERVE FUND FOR AFFORDABLE HOUSING.

    The Chairman of the appropriate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other levels in this resolution for one or more 
bills, joint resolutions, amendments, motions, or conference 
reports that would establish an affordable housing fund 
financed by the housing government sponsored enterprises, by 
the amounts provided in such legislation for that purpose (or, 
in the House, that contain offsets so designated for that 
purpose), provided in the Senate that such legislation would 
not increase the deficit over either the period of the total of 
fiscal years 2007 through 2012 or the period of the total of 
fiscal years 2007 through 2017, and provided further in the 
House that such legislation would not increase the deficit or 
decrease the surplus for the total over the period of fiscal 
years 2007 through 2012 or the period of fiscal years 2007 
through 2017.

SEC. 312. DEFICIT-NEUTRAL RESERVE FUND FOR RECEIPTS FROM BONNEVILLE 
                    POWER ADMINISTRATION.

    The Chairman of the appropriate Committee on the Budget may 
adjust the allocations of a committee or committees, 
aggregates, and other appropriate levels and limits in this 
resolution for one or more bills, joint resolutions, 
amendments, motions, or conference reports that prohibit the 
Bonneville Power Administration from making early payments on 
its Federal Bond Debt to the United States Treasury, by the 
amounts provided by that legislation for that purpose (or, in 
the House, that contain offsets so designated for that 
purpose), provided in the Senate that such legislation would 
not increase the deficit over either the period of the total of 
fiscal years 2007 through 2012 or the period of the total of 
fiscal years 2007 through 2017, and provided further in the 
House that such legislation would not increase the deficit or 
decrease the surplus for the total over the period of fiscal 
years 2007 through 2012 or the period of fiscal years 2007 
through 2017.

SEC. 313. DEFICIT-NEUTRAL RESERVE FUND FOR INDIAN CLAIMS SETTLEMENT.

    The Chairman of the appropriate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports that--
            (1) create an Indian claims settlement fund for 
        trust accounting and management deficiencies related to 
        Individual Indian Moneys and assets; and
            (2) extinguish all claims arising before the date 
        of enactment for losses resulting from accounting 
        errors, mismanagement of assets, or interest owed in 
        connection with Individual Indian Moneys accounts;
by the amounts provided in such legislation for those purposes 
up to $8,000,000,000 (or, in the House, that contain offsets so 
designated for those purposes), provided in the Senate that 
such legislation would not increase the deficit over either the 
period of the total of fiscal years 2007 through 2012 or the 
period of the total of fiscal years 2007 through 2017, and 
provided further in the House that such legislation would not 
increase the deficit or decrease the surplus for the total over 
the period of fiscal years 2007 through 2012 or the period of 
fiscal years 2007 through 2017.

SEC. 314. DEFICIT-NEUTRAL RESERVE FUND FOR IMPROVEMENTS IN HEALTH.

    (a) Health Insurance Coverage.--The Chairman of the 
appropriate Committee on the Budget may revise the allocations 
of a committee or committees, aggregates, and other appropriate 
levels in this resolution for one or more bills, joint 
resolutions, amendments, motions, or conference reports that 
make health insurance coverage more affordable or available to 
small businesses and their employees, through pooling 
arrangements that provide appropriate consumer protections, by 
the amounts provided in such legislation for that purpose (or, 
in the House, that contain offsets so designated for that 
purpose), provided in the Senate that such legislation would 
not increase the deficit over either the period of the total of 
fiscal years 2007 through 2012 or the period of the total of 
fiscal years 2007 through 2017, and provided further in the 
House that such legislation would not increase the deficit or 
decrease the surplus for the total over the period of fiscal 
years 2007 through 2012 or the period of fiscal years 2007 
through 2017.
    (b) Health Coverage.--If a SCHIP reauthorization bill is 
enacted, then the Chairman of the appropriate Committee on the 
Budget may revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports to improve health care, and provide quality 
health insurance for the uninsured and underinsured, and 
protect individuals with current health coverage, by the 
amounts provided in that legislation for that purpose (or, in 
the House, that contain offsets so designated for that 
purpose), provided in the Senate that such legislation would 
not increase the deficit over either the period of the total of 
fiscal years 2007 through 2012 or the period of the total of 
fiscal years 2007 through 2017, and provided further in the 
House that such legislation would not increase the deficit or 
decrease the surplus for the total over the period of fiscal 
years 2007 through 2012 or the period of fiscal years 2007 
through 2017.
    (c) Long-Term Care.--The Chairman of the appropriate 
Committee on the Budget may revise the allocations of a 
committee or committees, aggregates, and other levels in this 
resolution for one or more bills, joint resolutions, 
amendments, motions, or conference reports that would improve 
long-term care, enhance the safety and dignity of patients, 
encourage appropriate use of institutional and community-based 
care, promote quality care, or provide for the cost-effective 
use of public resources, by the amounts provided in such 
legislation for that purpose (or, in the House, that contain 
offsets so designated for that purpose), provided in the Senate 
that such legislation would not increase the deficit over 
either the period of the total of fiscal years 2007 through 
2012 or the period of the total of fiscal years 2007 through 
2017, and provided further in the House that such legislation 
would not increase the deficit or decrease the surplus for the 
total over the period of fiscal years 2007 through 2012 or the 
period of fiscal years 2007 through 2017.
    (d) Mental Health Parity.--The Chairman of the appropriate 
Committee on the Budget may revise the allocations of a 
committee or committees, aggregates, and other appropriate 
levels in this resolution for one or more bills, joint 
resolutions, amendments, motions, or conference reports that 
would provide parity between health insurance coverage of 
mental health benefits and benefits for medical and surgical 
services, including parity in public programs, by the amounts 
provided in such legislation for that purpose (or, in the 
House, that contain offsets so designated for that purpose), 
provided in the Senate that such legislation would not increase 
the deficit over either the period of the total of fiscal years 
2007 through 2012 or the period of the total of fiscal years 
2007 through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.

SEC. 315. DEFICIT-NEUTRAL RESERVE FUND FOR CHILD CARE.

    The Chairman of the appropriate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports that provide up to $5,000,000,000 for the 
child care entitlement to States, by the amounts provided by 
such legislation for that purpose (or, in the House, that 
contain offsets so designated for that purpose), provided in 
the Senate that such legislation would not increase the deficit 
over either the period of the total of fiscal years 2007 
through 2012 or the period of the total of fiscal years 2007 
through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.

SEC. 316. DEFICIT-NEUTRAL RESERVE FUND FOR IMMIGRATION REFORM IN THE 
                    SENATE.

    The Chairman of the Senate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other levels in this resolution for one or more 
bills, joint resolutions, amendments, motions, or conference 
reports that provide for immigration reform by the amounts 
provided in such legislation for those purposes, provided that 
such legislation would not increase the deficit over either the 
period of the total of fiscal years 2007 through 2012 or the 
period of the total of fiscal years 2007 through 2017.

SEC. 317. DEFICIT-REDUCTION RESERVE FUND.

    (a) Reduction of Improper Payments.--The Chairman of the 
appropriate Committee on the Budget may revise the allocations 
of a committee or committees, aggregates, and other appropriate 
levels and limits in this resolution upon enactment of 
legislation that achieves savings by eliminating or reducing 
improper payments made by agencies reporting improper payments 
estimates under the Improper Payments Information Act of 2002 
and uses such savings to reduce the deficit (or, in the House, 
that contain offsets so designated for that purpose), provided 
in the Senate that such legislation would not increase the 
deficit over either the period of the total of fiscal years 
2007 through 2012 or the period of the total of fiscal years 
2007 through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.
    (b) Increased Use of Recovery Audits.--The Chairman of the 
appropriate Committee on the Budget may revise the allocations 
of a committee or committees, aggregates, and other appropriate 
levels and limits in this resolution upon enactment of 
legislation that achieves savings by requiring that agencies 
increase their use of the recovery audits authorized by the 
Erroneous Payments Recovery Act of 2001 (section 831 of the 
National Defense Authorization Act for fiscal year 2002) and 
uses such savings to reduce the deficit (or, in the House, that 
contain offsets so designated for that purpose), provided in 
the Senate that such legislation would not increase the deficit 
over either the period of the total of fiscal years 2007 
through 2012 or the period of the total of fiscal years 2007 
through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.

SEC. 318. DEFICIT-NEUTRAL RESERVE FUND FOR MANUFACTURING INITIATIVES IN 
                    THE SENATE.

    In the Senate, the Chairman of the Senate Committee on the 
Budget may revise the allocations, aggregates, and other 
appropriate levels in this resolution for one or more bills, 
joint resolutions, amendments, motions, or conference reports, 
including tax legislation, that would revitalize the United 
States domestic manufacturing sector by increasing Federal 
research and development, by expanding the scope and 
effectiveness of manufacturing programs across the Federal 
government, by increasing support for development of 
alternative fuels and leap-ahead automotive and energy 
technologies, and by establishing tax incentives to encourage 
the continued production in the United States of advanced 
technologies and the infrastructure to support such 
technologies, by the amounts provided in that legislation for 
those purposes, provided that such legislation would not 
increase the deficit over either the period of the total of 
fiscal years 2007 through 2012 or the period of the total of 
fiscal years 2007 through 2017.

SEC. 319. DEFICIT-NEUTRAL RESERVE FUND FOR THE FOOD AND DRUG 
                    ADMINISTRATION IN THE SENATE.

    (a) Regulation.--In the Senate, the Chairman of the Senate 
Committee on the Budget may revise the allocations, aggregates, 
and other appropriate levels in this resolution for a bill, 
joint resolution, motion, amendment, or conference report that 
authorizes the Food and Drug Administration to regulate 
products and assess user fees on manufacturers and importers of 
those products to cover the cost of the Food and Drug 
Administration's regulatory activities, by the amounts provided 
in that legislation for those purposes, provided that such 
legislation would not increase the deficit over either the 
period of the total of fiscal years 2007 through 2012 or the 
period of the total of fiscal years 2007 through 2017.
    (b) Drug Importation.--In the Senate, the Chairman of the 
Senate Committee on the Budget may revise the aggregates, 
allocations, and other levels in this resolution for a bill, 
joint resolution, motion, amendment, or conference report that 
permits the safe importation of prescription drugs approved by 
the Food and Drug Administration from a specified list of 
countries, by the amounts provided in such legislation for that 
purpose, provided that such legislation would not increase the 
deficit over either the period of the total of fiscal years 
2007 through 2012 or the period of the total of fiscal years 
2007 through 2017.

SEC. 320. DEFICIT-NEUTRAL RESERVE FUND FOR MEDICAID.

    (a) Delay of Rule.--The Chairman of the appropriate 
Committee on the Budget may revise the allocations, aggregates, 
and other appropriate levels in this resolution for a bill, 
joint resolution, amendment, motion, or conference report that 
provides for a delay in the implementation of the proposed rule 
published on January 18, 2007, on pages 2236 through 2248 of 
volume 72, Federal Register (relating to parts 433, 447, and 
457 of title 42, Code of Federal Regulations) or any other rule 
that would affect the Medicaid program or SCHIP in a similar 
manner, or place restrictions on coverage of or payment for 
graduate medical education, rehabilitation services, or school-
based administration, transportation, or medical services under 
title XIX of the Social Security Act by the amounts provided in 
that legislation for that purpose (or, in the House, that 
contain offsets so designated for that purpose), provided in 
the Senate that such legislation would not increase the deficit 
over either the total of the period of fiscal years 2007 
through 2012 or the total of the period of fiscal years 2007 
through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.
    (b) Demonstration Project Regarding Medicaid Coverage of 
Low-Income HIV-Infected Individuals.--The Chairman of the 
appropriate Committee on the Budget may revise the allocations, 
aggregates, and other appropriate levels in this resolution for 
a bill, joint resolution, amendment, motion, or conference 
report that provides for a demonstration project under which a 
State may apply under section 1115 of the Social Security Act 
(42 U.S.C. 1315) to provide medical assistance under a State 
Medicaid program to HIV-infected individuals who are not 
eligible for medical assistance under such program under 
section 1902(a)(10)(A)(I) of the Social Security Act (42 U.S.C. 
1396a(a)(10)(A)(I)), by the amounts provided in that 
legislation for those purposes up to $500,000,000 (or, in the 
House, that contain offsets so designated for those purposes), 
provided in the Senate that such legislation would not increase 
the deficit over either the total of the period of fiscal years 
2007 through 2012 or the total of the period of fiscal years 
2007 through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.
    (c) Transitional Medical Assistance.--The Chairman of the 
appropriate Committee on the Budget may revise the allocations 
of a committee or committees, aggregates, and other appropriate 
levels in this resolution for one or more bills, joint 
resolutions, amendments, motions or conference reports that 
extend the Transitional Medical Assistance program, included in 
title XIX of the Social Security Act, by the amounts provided 
in such legislation for that purpose (or, in the House, that 
contain offsets so designated for that purpose), provided in 
the Senate that such legislation would not increase the deficit 
over either the total of the period of fiscal years 2007 
through 2012 or the total of the period of fiscal years 2007 
through 2017, and provided further in the House that such 
legislation would not increase the deficit or decrease the 
surplus for the total over the period of fiscal years 2007 
through 2012 or the period of fiscal years 2007 through 2017.

SEC. 321. RESERVE FUND ADJUSTMENT FOR REVENUE MEASURES IN THE HOUSE.

    In the House, for the duration of the 110th Congress with 
respect to consideration of any bill, joint resolution, 
amendment, motion, or conference report that would decrease 
total revenues for the single period comprising the budget year 
and the following 4 fiscal years below the Congressional Budget 
Office baseline for the most recent concurrent resolution on 
the budget, the Chairman of the House Committee on the Budget 
shall increase the revenue aggregates by $179,816,000,000 for 
the total over the period of fiscal years 2008 through 2012, if 
the Chairman determines that such legislation does not contain 
a provision consistent with the provision set forth in the 
joint explanatory statement of managers accompanying this 
concurrent resolution. The Chairman may readjust such levels 
upon disposition of any measure in violation of this section.

SEC. 322. DEFICIT-NEUTRAL RESERVE FUND FOR SAN JOAQUIN RIVER 
                    RESTORATION AND NAVAJO NATION WATER RIGHTS 
                    SETTLEMENTS.

    The Chairman of the appropriate Committee on the Budget may 
revise the allocations of a committee or committees, 
aggregates, and other appropriate levels in this resolution for 
one or more bills, joint resolutions, amendments, motions, or 
conference reports that would fulfill the purposes of the San 
Joaquin River Restoration Settlement Act, implement a Navajo 
Nation water rights settlement as authorized by the 
Northwestern New Mexico Rural Water Projects Act, or both, by 
the amounts provided by that legislation for those purposes 
(or, in the House, that contain offsets so designated for those 
purposes), provided in the Senate that such legislation would 
not increase the deficit over either the period of the total of 
fiscal years 2007 through 2012 or the period of the total of 
fiscal years 2007 through 2017, and provided further in the 
House that such legislation would not increase the deficit or 
decrease the surplus for the total over the period of fiscal 
years 2007 through 2012 or the period of fiscal years 2007 
through 2017.

SEC. 323. DEFICIT-NEUTRAL RESERVE FUND FOR SELECTED TAX RELIEF POLICIES 
                    IN THE SENATE.

    The Chairman of the Senate Committee on the Budget may 
revise the aggregates, allocations, and other appropriate 
levels in this resolution for one or more bills, joint 
resolutions, amendments, motions, or conference reports that 
would provide tax relief by extending the State and local sales 
tax deduction, extending enhanced charitable giving from 
individual retirement accounts, reauthorizing the new markets 
tax credit under section 45D of the Internal Revenue Code of 
1986, or extending and increasing the above-the-line deduction 
for teacher classroom supplies and expanding it to include 
qualified professional development expenses, by the amounts 
provided in that legislation for those purposes, provided that 
such legislation would not increase the deficit over either the 
period of the total of fiscal years 2007 through 2012 or the 
period of the total of fiscal years 2007 through 2017.

                            TITLE IV--POLICY

SEC. 401. POLICY ON MIDDLE-INCOME TAX RELIEF.

    (a) In the House.--
            (1) In general.--It is the policy of the House to 
        minimize fiscal burdens on middle-income families and 
        their children and grandchildren. It is the policy of 
        the House to provide immediate relief for the tens of 
        millions of middle-income households who would 
        otherwise be subject to the Alternative Minimum Tax 
        under current law. Furthermore, it is the policy of the 
        House to support extension of middle-income tax relief 
        and enhanced economic equity through policies such as--
                    (A) extension of the child tax credit;
                    (B) extension of marriage penalty relief;
                    (C) extension of the 10 percent individual 
                income tax bracket;
                    (D) elimination of estate taxes on all but 
                a minute fraction of estates by reforming and 
                substantially increasing the unified tax 
                credit;
                    (E) extension of the research and 
                experimentation tax credit;
                    (F) extension of the deduction for State 
                and local sales taxes;
                    (G) extension of the deduction for small 
                business expensing; and
                    (H) enactment of a tax credit for school 
                construction bonds.
            (2) Other matters.--The House assumes the cost of 
        enacting such policies is offset by reforms within the 
        Internal Revenue Code of 1986 that promote economic 
        efficiency, higher rates of tax compliance to close the 
        ``tax gap'', and reduced taxpayer burdens through tax 
        simplification.
    (b) In the Senate.--
            (1) In general.--The Senate adopted by a vote of 97 
        to 1 an amendment to S. Con. Res. 21 as reported by the 
        Senate Committee on the Budget which, with regard to 
        tax relief, reduced the revenue aggregates by 
        $179,816,000,000 to provide for--
                    (A) extension of the child tax credit;
                    (B) extension of marriage penalty relief;
                    (C) extension of the 10 percent individual 
                income tax bracket;
                    (D) reform of the estate tax to protect 
                small businesses and family farms;
                    (E) extension of the adoption tax credit;
                    (F) extension of the dependent care tax 
                credit;
                    (G) extension of the treatment of combat 
                pay for purposes of determining the Earned 
                Income Tax Credit; and
                    (H) other, unspecified tax relief.
            (2) Policy.--It is the policy of the Senate that 
        this resolution supports both the enactment of the 
        policies listed in paragraph (1) and the Senate pay-as-
        you-go rule in section 201, and that any additional 
        revenues needed to meet the Senate's tax policy goals 
        can be achieved by closing the tax gap, shutting down 
        abusive tax shelters, addressing offshore tax havens, 
        and without raising taxes.

SEC. 402. POLICY ON DEFENSE PRIORITIES.

    It is the policy of this resolution that--
            (1) implementing the recommendation of the National 
        Commission on Terrorist Attacks Upon the United States 
        (commonly referred to as the 9/11 Commission) to 
        adequately fund cooperative threat reduction and 
        nuclear nonproliferation programs should receive higher 
        priority than the President's budget provides;
            (2) TRICARE fees for military retirees under the 
        age of 65 should remain at current levels;
            (3) military pay and benefits should be enhanced to 
        improve retention of experienced personnel;
            (4) the recommendations of the bipartisan ``Walter 
        Reed Commission'' (the President's Commission on Care 
        for America's Returning Wounded Warriors) and other 
        United States Government investigations into military 
        healthcare facilities and services should be funded;
            (5) higher priority defense needs could be 
        addressed by funding missile defense at an adequate but 
        lower level, not providing funding for development of 
        space-based missile defense interceptors, and by 
        restraining excessive cost and schedule growth in 
        defense research, development and procurement programs;
            (6) sufficient resources should be provided for the 
        Department of Defense to do a more careful job of 
        addressing as many as possible of the 1,378 
        unimplemented recommendations made by the Government 
        Accountability Office over the last 6 years to improve 
        practices at the Department of Defense, including 
        investigation of the billions of dollars of 
        obligations, disbursements and overcharges for which 
        the Department of Defense cannot account; and
            (7) savings from the actions recommended in 
        paragraphs (5) and (6) of this section should be used 
        to fund the priorities identified in paragraphs (1) 
        through (4) in this section.

SEC. 403. POLICY ON COLLEGE AFFORDABILITY.

    It is the policy of this resolution that nothing in this 
resolution should be construed to reduce any assistance that 
makes college more affordable for students, including but not 
limited to assistance to student aid programs run by nonprofit 
state agencies.

           TITLE V--SENSE OF THE HOUSE AND SENSE OF CONGRESS

SEC. 501. SENSE OF CONGRESS ON SERVICEMEMBERS' AND VETERANS' HEALTH 
                    CARE AND OTHER PRIORITIES.

    It is the sense of Congress that--
            (1) Congress supports excellent health care for 
        current and former members of the United States Armed 
        Services, who have served well and honorably and have 
        made significant sacrifices for this Nation;
            (2) this resolution provides $43,125,000,000 in 
        discretionary budget authority for 2008 for Function 
        700 (Veterans Benefits and Services), including 
        veterans' health care, which is $6,668,000,000 more 
        than the 2007 level, $5,474,000,000 more than the 
        Congressional Budget Office's baseline level for 2008, 
        and $3,576,000,000 more than the President's budget for 
        2008;
            (3) this resolution provides funding to implement, 
        in part, recommendations of the bi-partisan ``Walter 
        Reed Commission'' (the President's Commission on Care 
        for America's Returning Wounded Warriors) and other 
        United States Government investigations into military 
        and veterans health care facilities and services;
            (4) this resolution assumes the rejection of the 
        enrollment fees and co-payment increases in the 
        President's budget;
            (5) this resolution provides additional funding 
        above the President's inadequate budget levels for the 
        Department of Veterans Affairs to research and treat 
        veterans' mental health, post-traumatic stress 
        disorder, and traumatic brain and spinal cord injuries; 
        and
            (6) this resolution provides additional funding 
        above the President's inadequate budget levels for the 
        Department of Veterans Affairs to improve the speed and 
        accuracy of its processing of disability compensation 
        claims, including funding to hire additional personnel 
        above the President's requested level.

SEC. 502. SENSE OF CONGRESS ON THE INNOVATION AGENDA: A COMMITMENT TO 
                    COMPETITIVENESS TO KEEP AMERICA #1.

    (a) It is the sense of Congress to provide sufficient 
funding that our Nation may continue to be the world leader in 
education, innovation and economic growth. This resolution 
provides substantial increased funding above the President's 
requested level for 2008, and additional amounts in subsequent 
years in Function 250 (General Science, Space and Technology) 
and Function 270 (Energy). Additional increases for scientific 
research and education are included in Function 500 (Education, 
Employment, Training, and Social Services), Function 550 
(Health), Function 300 (Environment and Natural Resources), 
Function 350 (Agriculture), Function 400 (Transportation), and 
Function 370 (Commerce and Housing Credit), all of which 
receive more funding than the President requested.
    (b) America's greatest resource for innovation resides 
within classrooms across the country. The increased funding 
provided in this resolution will support important initiatives 
to educate 100,000 new scientists, engineers, and 
mathematicians, and place highly qualified teachers in math and 
science K-12 classrooms.
    (c) Independent scientific research provides the foundation 
for innovation and future technologies. This resolution will 
put us on the path toward doubling funding for the National 
Science Foundation, basic research in the physical sciences, 
and collaborative research partnerships; and toward achieving 
energy independence through the development of clean and 
sustainable alternative energy technologies.

SEC. 503. SENSE OF CONGRESS ON HOMELAND SECURITY.

    It is the sense of Congress that--
            (1) this resolution assumes additional homeland 
        security funding above the President's requested level 
        for 2008 and every subsequent year;
            (2) this resolution assumes funding above the 
        President's requested level for 2008, and additional 
        amounts in subsequent years, in the four budget 
        functions: Function 400 (Transportation), Function 450 
        (Community and Regional Development), Function 550 
        (Health), and Function 750 (Administration of Justice) 
        that fund most nondefense homeland security activities; 
        and
            (3) the homeland security funding provided in this 
        resolution will help to strengthen the security of our 
        Nation's transportation system, particularly our ports 
        where significant security shortfalls still exist and 
        foreign ports, by expanding efforts to identify and 
        scan all high-risk United States-bound cargo, equip, 
        train and support first responders (including enhancing 
        interoperable communications and emergency management), 
        strengthen border patrol, and increase the preparedness 
        of the public health system.

SEC. 504. SENSE OF CONGRESS REGARDING THE ONGOING NEED TO RESPOND TO 
                    HURRICANES KATRINA AND RITA.

    The sense of Congress is as follows:
            (1) Critical needs in the Gulf Coast region should 
        be addressed without further delay. The budget 
        resolution creates a reserve fund that would allow for 
        affordable housing that may be used to focus on areas 
        devastated by Hurricanes Katrina and Rita, as well as 
        new funding for additional recovery priorities.
            (2) Additional oversight and investigation is 
        needed to ensure that recovery efforts are on track, 
        develop legislation to reform the contracting process, 
        and better prepare for future disasters. Those efforts 
        should be made in close consultation with residents of 
        affected areas. For example, the budget resolution 
        provides additional 2007 funding for the Federal 
        Emergency Management Agency, some of which may be used 
        for this purpose.

SEC. 505. SENSE OF CONGRESS REGARDING LONG-TERM SUSTAINABILITY OF 
                    ENTITLEMENTS.

    (a) Findings.--Congress finds the following:
            (1) The aging of the United States population is 
        going to put unprecedented pressure on the Nation's 
        retirement and health care systems.
            (2) The long-term strength of Social Security would 
        be improved through a fiscally responsible policy of 
        reducing the deficit and paying down the debt that has 
        accumulated since 2001, thus reducing debt service 
        payments and freeing up billions of dollars that can be 
        dedicated to meeting social security's obligations.
            (3) A policy of reducing and eventually eliminating 
        the deficit and paying down the debt is a key factor in 
        improving the long-term strength of the economy as a 
        whole, because a lower debt burden frees up resources 
        for productive investments that will result in higher 
        economic growth, provide a higher standard of living 
        for future generations, and enhance the Nation's 
        ability to meet its commitments to its senior citizens.
            (4) The most significant factor affecting the 
        Nation's entitlement programs is the rapid increase in 
        health care costs. The projected increasing costs of 
        Medicare and Medicaid are not unique to these programs 
        but rather are part of a pattern of rising costs for 
        the health sector as a whole.
    (b) Sense of Congress.--It is the sense of Congress that 
the growing cost of entitlements should be addressed in a way 
that is fiscally responsible and promotes economic growth, that 
addresses the causes of cost growth in the broader health care 
system, and that protects beneficiaries without leaving a 
legacy of debt to future generations.

SEC. 506. SENSE OF CONGRESS REGARDING THE NEED TO MAINTAIN AND BUILD 
                    UPON EFFORTS TO FIGHT HUNGER.

    (a) Findings.--Congress finds the following:
            (1) More than 35 million individuals (12.4 million 
        of them children) are food insecure, uncertain of 
        having, or unable to acquire enough food. 10.8 million 
        Americans are hungry because of lack of food.
            (2) Despite the critical contributions of the 
        Department of Agriculture nutrition programs and 
        particularly the food stamp program that significantly 
        reduced payment error rates while increasing enrollment 
        to partially mitigate the impact of recent increases in 
        the poverty rate, significant need remains.
            (3) Nearly 25 million people, including nine 
        million children and three million seniors, sought 
        emergency food assistance from food pantries, soup 
        kitchens, shelters, and local charities last year.
    (b) Sense of Congress.--It is the sense of Congress that 
the Department of Agriculture programs that help fight hunger 
should be maintained and that Congress should seize 
opportunities to enhance those programs to reach people in need 
and to fight hunger.

SEC. 507. SENSE OF CONGRESS REGARDING AFFORDABLE HEALTH COVERAGE.

    (a) Findings.--Congress finds the following:
            (1) More than 46 million Americans, including nine 
        million children, lack health insurance. People without 
        health insurance are more likely to experience problems 
        getting medical care and to be hospitalized for 
        avoidable health problems.
            (2) Most Americans receive health coverage through 
        their employers. A major issue facing all employers is 
        the rising cost of health insurance. Small businesses, 
        which have generated most of the new jobs annually over 
        the last decade, have an especially difficult time 
        affording health coverage, due to higher administrative 
        costs and fewer people over whom to spread the risk of 
        catastrophic costs. Because it is especially costly for 
        small businesses to provide health coverage, their 
        employees make up a large proportion of the nation's 
        uninsured individuals.
    (b) Sense of Congress.--It is the sense of Congress that 
legislation consistent with the pay-as-you-go principle should 
be adopted that makes health insurance more affordable and 
accessible, with attention to the special needs of small 
businesses, and that lowers costs and improves the quality of 
health care by encouraging integration of health information 
technology tools into the practice of medicine, and promoting 
improvements in disease management and disease prevention.

SEC. 508. SENSE OF CONGRESS REGARDING EXTENSION OF THE STATUTORY PAY-
                    AS-YOU-GO RULE.

    It is the sense of Congress that in order to reduce the 
deficit Congress should extend PAYGO consistent with provisions 
of the Budget Enforcement Act of 1990.

SEC. 509. SENSE OF CONGRESS ON LONG-TERM BUDGETING.

    It is the sense of Congress that the determination of the 
congressional budget for the United States Government and the 
President's budget request should include consideration of the 
Financial Report of the United States Government, especially 
its information regarding the Government's net operating cost, 
financial position, and long-term liabilities.

SEC. 510. SENSE OF CONGRESS REGARDING PAY PARITY.

    It is the sense of Congress that rates of compensation for 
civilian employees of the United States should be adjusted at 
the same time, and in the same proportion, as are rates of 
compensation for members of the uniformed services.

SEC. 511. SENSE OF CONGRESS REGARDING WASTE, FRAUD, AND ABUSE.

    It is the sense of Congress that all committees should 
examine programs within their jurisdiction to identify wasteful 
and fraudulent spending. To this end, section 207 of this 
resolution includes cap adjustments to provide appropriations 
for 3 programs that accounted for a significant share of 
improper payments reported by Federal agencies in 2006: Social 
Security Administration Continuing Disability Reviews, the 
Medicare/Medicaid Health Care Fraud and Abuse Control Program, 
and Unemployment Insurance. Section 207 also includes a cap 
adjustment for the Internal Revenue Service for tax compliance 
efforts to close the tax gap. In addition, the resolution's 
deficit-neutral reserve funds require authorizing committees to 
cut lower-priority and wasteful spending to accommodate higher-
priority programs. Finally, section 207 of the resolution 
directs all committees to review the performance of programs 
within their jurisdiction and report recommendations annually 
to the Committees on the Budget as part of the views and 
estimates process required by section 301(d) of the 
Congressional Budget Act of 1974.

SEC. 512. SENSE OF CONGRESS REGARDING THE IMPORTANCE OF CHILD SUPPORT 
                    ENFORCEMENT.

    It is the sense of Congress that--
            (1) additional legislative action is needed to 
        ensure that States have the necessary resources to 
        collect all child support that is owed to families and 
        to allow them to pass 100 percent of support on to 
        families without financial penalty; and
            (2) when 100 percent of child support payments are 
        passed to the child, rather than administrative 
        expenses, program integrity is improved and child 
        support participation increases.

SEC. 513. SENSE OF THE HOUSE ON STATE VETERANS CEMETERIES.

    It is the sense of the House that the Federal Government 
should pay the plot allowance for the interment in a State 
veterans cemetery of any spouse or eligible child of a veteran, 
consistent with the pay-as-you-go principle.

SEC. 514. SENSE OF CONGRESS ON THE STATE CRIMINAL ALIEN ASSISTANCE 
                    PROGRAM.

    (a) Findings.--Congress makes the following findings:
            (1) Control of illegal immigration is a Federal 
        responsibility.
            (2) The State Criminal Alien Assistance Program 
        (referred to in this section as ``SCAAP'') carried out 
        pursuant to section 241(i) of the Immigration and 
        Nationality Act (8 U.S.C. 1231(i)) provides critical 
        funding to States and localities for reimbursement of 
        costs incurred as a result of housing undocumented 
        criminal aliens.
            (3) Congress appropriated $300,000,000 for SCAAP to 
        reimburse State and local governments for those costs 
        in fiscal year 2004.
            (4) Congress appropriated $305,000,000 for SCAAP to 
        reimburse State and local governments for those costs 
        in fiscal year 2005.
            (5) Congress appropriated $405,000,000 for SCAAP to 
        reimburse State and local governments for those costs 
        in fiscal year 2006.
            (6) Congress appropriated $399,000,000 for SCAAP to 
        reimburse State and local governments for those costs 
        in fiscal year 2007.
            (7) Congress has authorized to be appropriated 
        $950,000,000 to carry out SCAAP for each of the fiscal 
        years 2008 through 2011.
    (b) Sense of Congress.--It is the sense of Congress that 
SCAAP funding for fiscal year 2008 should be consistent with 
the goal of achieving the program's fully authorized level.

                        TITLE VI--RECONCILIATION

SEC. 601. RECONCILIATION IN THE HOUSE.

    Not later than September 10, 2007, the House Committee on 
Education and Labor shall report to the House of 
Representatives changes in laws to reduce the deficit by 
$750,000,000 for the period of fiscal years 2007 through 2012.

SEC. 602. DEFICIT REDUCTION RECONCILIATION INSTRUCTION IN THE SENATE.

    Not later than September 10, 2007, the Senate Committee on 
Health, Education, Labor, and Pensions shall report changes in 
laws within its jurisdiction to reduce the deficit by 
$750,000,000 for the period of fiscal years 2007 through 2012.

    And the House agree to the same.

                                   John M. Spratt, Jr.,
                                   Rosa DeLauro,
                                   Chet Edwards,
                                 Managers on the Part of the House.

                                   Kent Conrad,
                                   Patty Murray,
                                   Ron Wyden,
                                Managers on the Part of the Senate.
       Joint Explanatory Statement of the Committee of Conference

      The managers on the part of the House and the Senate at 
the conference on the disagreeing votes of the two Houses on 
the amendment of the House to the concurrent resolution (S. 
Con. Res. 21) revising the congressional budget for the United 
States Government for fiscal year 2007, establishing the 
congressional budget for the United States Government for 
fiscal year 2008, and setting forth appropriate budgetary 
levels for fiscal years 2009 through 2012, submit the following 
joint statement to the House and the Senate in explanation of 
the effect of the action agreed upon by the managers and 
recommended in the accompanying conference report:
      The House amendment struck all of the Senate concurrent 
resolution after the enacting clause and inserted a substitute 
text.
      The Senate recedes from its disagreement to the amendment 
of the House with an amendment that is a substitute for the 
Senate concurrent resolution and the House amendment. The 
differences between the Senate concurrent resolution, the House 
amendment, and the substitute agreed to in conference are noted 
below, except for clerical corrections, conforming changes made 
necessary by agreements reached by the conferees, and minor 
drafting and clarifying changes.

                          Displays and Amounts

      The required contents of concurrent budget resolutions 
are set forth in section 301(a) of the Congressional Budget Act 
of 1974. The years in this document are fiscal years unless 
otherwise noted.
      The treatment of budget function levels in the Senate-
passed and House-passed budget resolutions and the conference 
report is as follows:
Senate Concurrent Resolution
      The Senate concurrent resolution includes all of the 
items required under Section 301(a) of the Congressional Budget 
Act.
House Amendment
      The House amendment includes all of the items required as 
part of a concurrent budget resolution under section 301(a) of 
the Congressional Budget Act other than the spending and 
revenue levels for Social Security (which are used to enforce a 
point of order applicable only in the Senate). It also includes 
a new separate function category, Function 970 (Overseas 
Deployments and Other Activities).
Conference Agreement
      The conference agreement includes all of the items 
required by Section 301(a) of the Budget Act.


                     Aggregate and Function Levels

      Pursuant to section 301(a)(3) of the Budget Act, the 
budget resolution must set appropriate levels for each major 
functional category based on the 302(a) allocations and the 
budgetary totals.
      The respective levels of the Senate concurrent 
resolution, the House amendment, and conference agreement for 
each major budget function, as well as revenue totals, are 
discussed in the following section. A summary of the overall 
budget policy is as follows:
      Total spending is $2.965 trillion in budget authority 
(BA) and $2.937 trillion in outlays in 2008, and $15.538 
trillion in BA and $15.567 trillion in outlays over 2008-2012.
      Discretionary spending for 2008 totals $1.100 trillion in 
BA and $1.145 trillion in outlays in 2008, and $5.246 trillion 
in BA and $5.615 trillion in outlays over 2008-2012. Excluding 
funding for overseas deployments and other activities, 
discretionary spending for 2008 totals $954.1 billion in BA and 
$1.029 trillion in outlays. These aggregate amounts (minus cap 
adjustments for program integrity initiatives) are allocated to 
the Appropriations Committees to be suballocated among their 
respective appropriations subcommittees.
      Mandatory spending totals $1.866 trillion in BA and 
$1.792 trillion in outlays in 2008, and $10.293 trillion in BA 
and $9.952 trillion in outlays over 2008-2012. This includes 
$750 million in reconciled savings over 2007-2012. These 
savings are reflected in Function 500. Specific policies to 
achieve those savings will be determined by the committees of 
jurisdiction.
      Revenue totals $2.685 trillion in 2008, and $14.828 
trillion over five years. Specific policies will be determined 
by the Committee on Finance in the Senate and the Committee on 
Ways and Means in the House.
      The conference report reduces the budget deficit from 
$251.7 billion in 2008, to a surplus of $41.5 billion in 2012.
      The following section describes the conference report's 
revenue levels and spending according to the budget's 
functional categories.

                                Revenues

Summary
      The revenue component of the budget resolution reflects 
all of the federal government's tax receipts that are 
classified as ``on budget.'' This includes individual income 
taxes; corporate income taxes; excise taxes, such as the 
gasoline tax; and other taxes, such as estate and gift taxes. 
Taxes collected for the Social Security system--the Old Age and 
Survivors and Disability Insurance (OASDI) payroll tax--are 
``off budget.'' The Hospital Insurance payroll tax portion of 
Medicare, the Federal Unemployment Tax Act payroll tax, 
railroad retirement and other retirement systems are all ``on 
budget.'' Customs duties, tariffs, and other miscellaneous 
receipts are also included in the revenue component. Pursuant 
to the Congressional Budget Act of 1974 and the Budget 
Enforcement Act of 1990, Social Security payroll taxes are not 
included in the budget resolution.
Senate Resolution
      The Senate budget resolution includes $2.0 trillion in 
on-budget revenues for 2008, and $11.1 trillion over 2008-2012. 
(The corresponding revenue figures on a unified basis are $2.7 
trillion for 2008 and $14.8 trillion over five years.) The 
resolution provides two years of relief from the Alternative 
Minimum Tax (AMT), protecting some 20 million middle-class 
taxpayers from being subject to the AMT in 2007 and 2008. The 
cost of providing this relief is fully offset. The resolution 
also assumes the extension of the college tuition deduction, 
with the costs offset.
      The revenue level in the Senate resolution is $179.8 
billion below the levels in the CBO baseline over 2007-2012. 
This provides for the extension after 2010 of middle-class tax 
relief--child tax credit, the 10 percent bracket, and marriage 
penalty relief--as well as continuation of the estate tax at 
2009 levels adjusted for inflation. In addition, this revenue 
reduction accommodates extension of other tax provisions 
expiring in 2010, such as the adoption tax credit, the 
dependent care tax credit, and the treatment of combat pay for 
purposes of the earned income tax credit.
      The Senate resolution includes several reserve funds that 
provide for tax relief, including refundable tax relief and the 
extension of expiring tax relief, as long as the costs of these 
provisions are offset. These deficit-neutral reserve funds 
would accommodate, for instance, tax relief related to 
agriculture, energy, higher education, and manufacturing as 
well as the extension of enhanced charitable giving from 
individual retirement accounts, the State and local sales tax 
deduction, the new markets tax credit, and the above-the-line 
deduction for teacher classroom supplies.
      The Senate resolution assumes that any additional 
revenues needed under the resolution can be achieved by closing 
the tax gap, shutting down abusive tax shelters, addressing 
offshore tax havens, and without raising taxes. To help close 
the tax gap and bolster Internal Revenue Service (IRS) 
enforcement, the resolution fully funds the President's budget 
request for the IRS, including additional resources available 
through a discretionary cap adjustment that directs $406 
million to IRS enforcement activities.
House Amendment
      The House amendment matches the level of revenues under 
the CBO baseline in each year over the 2007-2012 period. This 
includes $2.1 trillion in on-budget revenues for 2008, and 
$11.3 trillion over 2008-2012. (The corresponding revenue 
figures on a unified basis are $2.7 trillion for 2008 and $15.0 
trillion over five years.)
      By following CBO's baseline path of revenues, the House 
amendment achieves current-law total revenue levels, but does 
not assume maintaining current tax law. Thus, the House 
amendment accommodates reform of the AMT and extension of tax 
cuts benefitting middle-income households (including the child 
tax credit, marriage penalty relief, the 10 percent bracket, 
and the deduction for State and local sales taxes), as long as 
such changes to tax law are accomplished in a deficit-neutral 
manner over the 2007-2012 and 2007-2017 periods.
      The House amendment also accommodates deficit-neutral 
extension of other expiring tax provisions, such as the 
research and experimentation tax credit and the deduction for 
small business expensing. In addition, the House amendment 
accommodates deficit-neutral elimination of estate taxes on all 
but a minute fraction of estates by reforming and substantially 
increasing the unified tax credit. It also accommodates other 
high priority deficit-neutral revenue adjustments, such as 
providing a tax credit for local bonds to support the repair or 
construction of public schools.
Conference Agreement
      The conference agreement includes $2.0 trillion in on-
budget revenues for 2008, and $11.1 trillion over 2008-2012. 
(The corresponding revenue figures on a unified basis are $2.7 
trillion for 2008 and $14.8 trillion over five years.) The 
resolution provides immediate relief from the Alternative 
Minimum Tax (AMT), with its cost fully offset. The resolution 
also reflects extension of the college tuition deduction, with 
the costs offset. The agreement supports tax relief that would 
benefit the middle class--including extension of the child tax 
credit, 10 percent bracket, and marriage penalty relief--and 
provide for estate tax reform. Additionally, the agreement 
includes several deficit-neutral reserve funds that provide for 
a wide range of tax policies.
      The revenue level in the conference agreement is $180 
billion below the levels in the CBO baseline over 2007-2012. 
Revenue legislation is subject to House and Senate pay-as-you-
go (paygo) rules. Additionally, the House reserve fund 
adjustment for revenue measures (Section 321)--the House 
``trigger'' mechanism--creates a second procedural hurdle in 
the House only, in addition to the paygo rule, to ensure fiscal 
responsibility.

                     National Defense: Function 050

Function Summary
      The National Defense function includes the military 
activities of the Department of Defense (DoD), the nuclear-
weapons related activities of the Department of Energy (DoE) 
and the National Nuclear Security Administration, and the 
national security activities of several other agencies such as 
the Selective Service, Coast Guard and Federal Bureau of 
Investigation. The programs in this function include: the pay 
and benefits of active, Guard, and reserve military personnel; 
DoD operations including training, maintenance of equipment, 
and facilities; health care for military personnel and 
dependents; procurement of weapons; research and development; 
construction of military facilities, including housing; 
research on nuclear weapons; and the cleanup of nuclear weapons 
production facilities.
Senate Resolution
      The Senate resolution calls for a total of $648.8 billion 
in BA and $617.8 billion in outlays for 2008, and $2.9 trillion 
in BA and outlays over five years. This includes full funding 
for the President's request for war costs for 2007 through 
2009.
      Excluding requested war funds, the Senate resolution 
provides $503.8 billion in BA and $511.1 billion in outlays for 
defense in 2008. This funding for defense was equal to the 
level requested by the President for 2008 (as re-estimated by 
CBO), for a total increase of $39.6 billion in BA over the 2007 
level adjusted for inflation.
      The Senate resolution rejects the President's proposals 
for new TRICARE enrollment fees and deductibles for military 
retirees under the age of 65.
      Additionally, the Senate resolution assumes full funding 
of the President's request for $690 million to support the 
baseline cost to completion for the waste treatment plant and 
associated facilities at the Hanford Nuclear Reservation. The 
resolution additionally assumes increases totaling $22.9 
million for the Hanford tank farm and other Hanford cleanup-
related programs.
      The Senate resolution recognizes that many communities 
will experience significant population growth or declines 
resulting from the Base Realignment and Closure (BRAC) 2005 
process, and it supports additional funding to accommodate the 
needs of these communities.
      The National Guard has a long history of outstanding 
service to our nation. Since September 11, 2001, our reliance 
on the National Guard has only increased with many thousands of 
troops serving the nation both at home and abroad. The 
President has now announced that National Guard units will face 
re-activation for additional tours of duty in Iraq and 
Afghanistan despite the fact that they have not had the amount 
of time at home station between deployments that is expected 
under Department of Defense standards. Congress has provided 
the National Guard with significant resources in recognition of 
the important role the Guard plays in our national security and 
to ensure that it has the tools to continue to perform its 
missions. The Senate resolution assumed continued funding of 
the National Guard at levels at least as high as those assumed 
in the President's Budget. The Senate resolution encourages the 
Appropriations Committee to provide for critical needs for 
National Guard equipment left unfunded in the President's 
Budget.
      The Senate resolution includes a cap adjustment provision 
allowing the Chairman of the Budget Committee to revise the 
discretionary spending cap for appropriations related to 
operations in Iraq, Afghanistan, and other war-related costs. 
The cap adjustment allowed under the Senate resolution is 
$145.2 billion in budget authority for 2008 and $50.0 billion 
for 2009 (a portion of these costs are expected to fall under 
budget functions other than National Defense). The Senate 
resolution's levels of deficits and debt assumes that this cap 
adjustment is fully utilized.
      An additional defense-related cap adjustment provision 
allows the Chairman of the Budget Committee to increase the 
discretionary cap by up to $5.0 billion to address deficiencies 
in training, equipment, force protection, logistics, or other 
matters necessary for the protection of United States military 
forces, or to address deficiencies at Walter Reed and other 
military medical facilities.
      The existence of these cap adjustments would not prevent 
the Appropriations Committee from reporting emergency 
supplemental appropriations legislation if war costs exceed the 
allotted level. Emergency funding falls outside the 
discretionary spending caps included in the resolution, and 
hence does not require an adjustment.
      For 2007, the Senate resolution assumes the enactment of 
the President's full emergency request for war costs, 
consisting of $99.6 billion in BA and $27.0 billion in outlays. 
Each of these levels is equal to CBO's reestimate of the 
President's war funding request.
House Amendment
      The House amendment reflects a total of $507.0 billion in 
BA and $514.4 billion in outlays in 2008, and $2.7 trillion in 
BA and outlays over five years. The defense of our nation ranks 
first among our priorities, and the House amendment accordingly 
provides robust funding for Function 050 (National Defense). 
The amendment calls, however, for a reallocation of resources 
to address threats facing the nation and to guarantee first-
rate health care for members of our armed forces. It includes 
assumptions on specific defense policy in Title IV, Section 
402.
      The National Commission on Terrorist Attacks Upon the 
United States (commonly referred to as the 9/11 Commission) 
identified terrorists with weapons of mass destruction as one 
of the nation's gravest threats. It recommended that Congress 
supply more resources to secure nuclear weapons and the fissile 
materials used in making these weapons. It is the policy of the 
House amendment that non-proliferation programs, such as the 
Cooperative Threat Reduction program, be given greater priority 
and higher funding.
      High among our priorities is the health care guaranteed 
our armed forces, not only while they are in harm's way, but 
when they return from combat with injuries. For that reason, 
the House amendment opposes Tricare fee increases and calls for 
a substantial increase in the veterans' health care system. The 
amendment notes the upcoming recommendations of the President's 
Commission on Care for America's Returning Wounded Warriors and 
other government investigations in connection with the 
substandard care at Walter Reed Army Medical Center, and allows 
funds for action when those recommendations are received.
      It is the policy of the House amendment that acquisition 
programs such as missile defense and satellite procurement be 
funded at lower, but still robust levels. Development of space-
based interceptors as part of the missile defense program 
should be de-emphasized and satellite development and 
procurement should proceed along a more measured schedule. 
DoD's satellite programs have experienced significant cost 
growth and the President's request for satellite acquisition 
reflects a 26 percent increase above the 2007 enacted level.
      The House amendment recognizes the need for DoD to root 
out wasteful spending with far more diligence. Seventeen years 
after passage of the Chief Financial Officers Act of 1990, DoD 
still cannot pass a standard audit. The Department cannot 
adequately track what it owns or the spending in its annual 
budgets. DoD has allowed the cost of its major acquisition 
programs to grow at an unsustainable rate. The Department's 
major acquisition programs grew by $317.0 billion above their 
initial projections from 2002 to 2006. DoD has awarded 
contracts for its foreign deployments that have been grossly 
more wasteful than domestic contracts, especially in Iraq. 
Furthermore, DoD continues to fund weapons systems that were 
developed years ago to counter Cold War-era threats, which may 
not be as effective in protecting the nation from today's 
threats.
      Over the last six years, the Government Accountability 
Office (GAO) has performed numerous audits of DoD's financial 
management, contracting, and business practices. GAO made 2,544 
recommendations, of which 1,378 have yet to be implemented. The 
House amendment assumes that enhancing accounting practices at 
DoD and implementing many GAO recommendations would yield 
substantial savings that could be applied to meet critical 
defense priorities. The amendment also directs the committees 
with jurisdiction over defense and armed services to conduct 
more oversight with the objective of ferreting out wasteful 
practices, fraud, and abuse.
      For mandatory programs, the House amendment matches the 
President's assumptions regarding offsetting receipts.
Conference Agreement
      The conference agreement for Function 050 includes a 
total of $507.0 billion in BA and $514.4 billion in outlays in 
2008, and $2.7 trillion in BA and outlays over five years. The 
conference agreement does not assume enactment of the 
President's proposals for new TRICARE enrollment fees and 
deductibles for military retirees under the age of 65. In 
keeping with the Senate resolution, the conference agreement 
assumes that total National Defense funding includes no less 
than $5.0 billion to address deficiencies in training, 
equipment, force protection, logistics, and military medical 
care. The conference agreement reaffirms the Senate 
resolution's position on the importance of robust funding for 
atomic energy defense environmental cleanup activities.
      For mandatory programs, the conference agreement matches 
the President's assumptions regarding offsetting receipts.
      The conference agreement reflects war costs in Function 
970, as in the House amendment.
      The conference agreement also includes a deficit-neutral 
reserve fund (Section 302) to provide increased flexibility to 
the relevant House and Senate committees on various issues 
related to meeting our commitments to wounded and disabled 
military personnel and veterans, as well as their survivors.
      The conference agreement includes a statement of policy 
on defense issues (Section 402). The House Budget Committee 
report (H. Rept. 110-69) discussed key priorities to be funded 
within the defense allocation and the need for the Department 
of Defense to root out wasteful spending (such as the continued 
funding of some Cold War-era weapons systems, which may not be 
as effective in protecting the nation from today's threats). 
The conference agreement reaffirms these priorities.

                  International Affairs: Function 150

Function Summary
      The International Affairs function includes funding for 
operations of U.S. embassies and other diplomatic missions 
abroad; development aid and technical assistance to developing 
countries; security assistance to foreign governments; refugee 
assistance; Foreign Military Sales Trust Fund; contributions to 
international organizations, including financial institutions; 
and the Export-Import Bank and other trade promotion programs. 
The major agencies in this function include the Departments of 
Agriculture, State, and the Treasury; the United States Agency 
for International Development; and the Millennium Challenge 
Corporation.
Senate Resolution
      The Senate resolution calls for a total of $39.2 billion 
in BA and $36.9 billion in outlays, including the 2008 
emergency request, and $180.0 billion in BA and $172.3 billion 
in outlays over five years. Excluding assumed war costs 
provided under a cap adjustment, discretionary spending for 
2008 totals $36.5 billion in BA and $35.9 billion in outlays. 
The discretionary level is $6.5 billion above the 2007 level 
adjusted for inflation. The Senate resolution includes an 
increase in funding for international programs and additional 
funds for trade enforcement.
      Overall, the Senate resolution increases funding for the 
President's Emergency Plan for AIDS Relief above the requested 
level and provides a U.S. contribution to the Global Fund for 
HIV/AIDS, Tuberculosis and Malaria of $940 million.
House Amendment
      The House amendment reflects a total of $34.7 billion in 
non-emergency BA and $33.1 billion in non-emergency outlays in 
2008, and $178.3 billion in BA and $165.0 billion in outlays 
over five years. The House amendment's discretionary budget 
authority for 2008 is $2.0 billion (5.9 percent) more than the 
amount needed to maintain purchasing power at the 2007 level. 
The amendment matches the President's Function 150 request for 
activities related to the United States' overseas military 
deployments and the Emergency Plan for AIDS Relief, which 
includes the Global HIV/AIDS Initiative. The House also notes 
the importance of adequate funding for core U.S. development 
assistance and other high priority programs.
      Consistent with the President's budget, the House 
amendment also provides full funding to continue agreements 
that the United States reached in 1998 with Israel and Egypt 
regarding levels of military financing and economic support.
      The House amendment provides additional funding for 2008 
for the McGovern-Dole International Food for Education and 
Child Nutrition Program. This program has been demonstrated to 
help reduce child hunger and malnutrition, and increase 
enrollment and attendance in schools in beneficiary countries.
      The House notes the large amount of unobligated funding 
that is still available for the Millennium Challenge 
Corporation, which has received almost $6.0 billion in total 
appropriations from fiscal years 2004 through 2007.
      The House also notes the strong support enjoyed by H.R. 
1595, a measure designed to provide compensation to the 
Guamanian victims of the Imperial Japanese military occupation 
during World War II.
Conference Agreement
      The conference agreement includes $34.7 billion in BA and 
$33.1 billion in outlays in 2008, and $180.1 billion in BA and 
$166.5 billion in outlays over five years. The conference 
agreement reflects international affairs funding associated 
with overseas deployments and related activities in Function 
970, as in the House amendment.

          General Science, Space, and Technology: Function 250

Function Summary
      The General Science, Space, and Technology function 
includes funding for the National Aeronautics and Space 
Administration (NASA), except aviation programs, the National 
Science Foundation (NSF), as well as programs in the Department 
of Energy (DoE) Office of Science.
Senate Resolution
      The Senate resolution calls for a total of $27.6 billion 
in BA and $26.4 billion in outlays for 2008, and $137.5 billion 
in BA and $136.4 billion in outlays over five years.
      The Senate resolution assumes the President's request of 
$17.3 billion for NASA. The United States' goals for space 
exploration were defined in the President's ``Vision for Space 
Exploration'' and included in the National Aeronautics and 
Space Administration Authorization Act of 2005. The resolution 
recognizes the importance of our nation's space program and 
endorsed the Act's balanced goals of exploration, science and 
aeronautics. The Act calls for retirement of the Space Shuttle 
by 2010 and first flight of its replacement by 2014. The Senate 
resolution recognizes the strategic importance of uninterrupted 
access to space and supported efforts to reduce this four-year 
gap in U.S. human space flight.
      In addition, the Senate resolution notes the importance 
of incentives to promote innovation and competitiveness through 
research as essential to our nation's efforts to advance the 
scientific and technological developments necessary to maintain 
our quality of life and economic security. The resolution also 
reflects the Senate's concern about the geographic imbalance of 
federal research funding and believes that it is incumbent upon 
departments and agencies to ensure a more equitable 
distribution of funding and research infrastructure development 
throughout the nation.
      The Senate resolution provides a $1.0 billion increase 
for additional investments in innovation and education, and $40 
million for NSF nanotechnology programs.
House Amendment
      The House amendment reflects a total of $27.6 billion in 
BA and $26.5 billion in outlays in 2008, and $149.6 billion in 
BA and $145.8 billion in outlays over five years. Funding in 
Function 250 exceeds the funding levels in the President's 
budget and the current services level for all five years in the 
budget window. Additional increases for scientific research and 
education are included in Function 270 (Energy), Function 300 
(Environment and Natural Resources), Function 350 
(Agriculture), Function 370 (Commerce and Housing Credit), 
Function 400 (Transportation), Function 500 (Education, 
Training, Employment, and Social Services), and Function 550 
(Health), all of which receive more funding than the President 
requested. These increases will support the goals of the House 
Leadership's Innovation Agenda: to put NSF funding on a path 
toward doubling, to train more qualified science and math 
teachers, and to invest in basic research on energy 
technologies.
Conference Agreement
      The conference agreement includes $27.6 billion in BA and 
$26.5 billion in outlays in 2008 and $149.6 billion in BA and 
$145.8 billion in outlays over five years. The conference 
agreement provides significant increases for NSF and the DoE 
Office of Science, and fully funds the President's 2008 request 
for NASA at $17.3 billion. For NASA, this represents an 
increase of $696 million, or 4 percent, above the 2007 level 
adjusted for inflation.

                          Energy: Function 270

Function Summary
      The Energy function includes funding for most civilian 
energy and environmental programs in the Department of Energy 
(DoE). This function also includes the Rural Utilities Service 
of the Department of Agriculture, the Tennessee Valley 
Authority, the Federal Energy Regulatory Commission, and the 
Nuclear Regulatory Commission. This function does not include 
DoE's national security activities, which are in the National 
Defense function, or its basic research and science activities, 
which are in the General Science, Space and Technology 
function.
Senate Resolution
      The Senate resolution calls for a total of $3.7 billion 
in BA and $1.3 billion in outlays for 2008, and $16.6 billion 
in BA and $8.5 billion in outlays over five years. The Senate 
resolution assumes $1.6 billion for the DoE's Energy Efficiency 
and Renewable Energy program. This funding level is $385 
million above the President's request. In addition, the Senate 
resolution rejects the President's proposed cuts to the fossil 
energy research and development program.
      The Senate resolution includes a deficit-neutral reserve 
fund for energy legislation that would reduce our nation's 
dependence on foreign sources of energy, expand production and 
use of alternative fuels and alternative fuel vehicles, promote 
renewable energy development, improve electricity transmission, 
encourage responsible development of domestic oil and natural 
gas resources, or reward conservation and efficiency. The 
reserve fund will provide committees increased flexibility in 
finding offsets for legislation that addresses the energy 
challenges facing our nation. The Senate resolution also 
includes a deficit-neutral reserve fund which accommodates the 
extension of various energy tax incentives.
      The Senate resolution rejects the President's proposal to 
increase the interest rates Power Marketing Administrations pay 
when they borrow funds from the Treasury. The resolution also 
rejects the proposal to accelerate the Bonneville Power 
Administration's (BPA's) debt repayment. The BPA proposal could 
lead to higher electricity rates for power customers in the 
Northwest and circumvent the regional decision making process. 
It is unfortunate that the President's budget proposed this 
again after it was explicitly rejected by Congress last year. 
The resolution does not assume any savings from the proposal 
and includes a deficit-neutral reserve fund for legislation 
blocking the proposal. The levels for the energy function 
assume funding to accommodate legislation blocking the BPA 
proposal.
      The Senate resolution adds funding for carbon 
sequestration and capture technology and funding for 
geothermal, ocean, and hydroelectric energy assistance.
House Amendment
      The House amendment reflects a total of $3.2 billion in 
BA and $1.1 billion in outlays for 2008, and $16.0 billion in 
BA and $7.9 billion in outlays over five years. The amendment 
provides funding above the President's request and the level 
needed to maintain current services for Function 270. This 
increased funding could be used for research, development, and 
deployment of renewable and alternative energy technology and 
resources.
      The House amendment also establishes a reserve fund to 
facilitate the development of conservation and efficiency 
technologies, clean domestic renewable energy resources, and 
alternative fuels that will reduce our reliance on foreign oil. 
The federal government, and particularly the DoE, should take 
the lead in research and development, and to that end, the 
House amendment includes an increase in Function 270 above 
baseline, while emphasizing that this is a first step toward 
increases that need to come soon and be substantial.
      In the meantime, the DoE should husband its resources and 
program work at the national laboratories to advance the 
technologies of energy conservation and efficiency and of 
clean, renewable energy. Other agencies and departments of the 
government should join this effort. The House amendment 
recognizes, for example, the role that the Department of 
Agriculture could take in developing new energy sources such as 
cellulosic ethanol, and approves this mission among those cited 
in Function 350.
      Funding sources for research and development are 
scattered throughout the budget. These sources need to be 
inventoried, and where possible, refocused on research and 
development of clean and renewable energies.
Conference Agreement
      The conference agreement includes $3.4 billion in BA and 
$1.2 billion in outlays for 2008, and $16.6 billion in BA and 
$8.5 billion in outlays over five years. The conference 
agreement rejects the proposal to accelerate the Bonneville 
Power Administration's (BPA's) debt repayment. The BPA proposal 
could lead to higher electricity rates for power customers in 
the Northwest and circumvent the regional decision making 
process. It is unfortunate that the President's budget proposed 
this again after it was explicitly rejected by Congress last 
year. The conference agreement does not assume any savings from 
the proposal and includes a deficit-neutral reserve fund for 
legislation rejecting the proposal. The levels for the energy 
function assume funding to accommodate legislation rejecting 
the BPA proposal.
      The conference agreement also rejects the President's 
proposal to increase the interest rates Power Marketing 
Administrations pay when they borrow funds from the Treasury.
      The conference agreement includes a deficit-neutral 
reserve fund to accommodate energy legislation in both the 
House and the Senate.

            Natural Resources and Environment: Function 300

Function Summary
      The Natural Resources and Environment function consists 
of funding for water resources, conservation, land management, 
pollution control and abatement, and recreational resources. 
Major departments and agencies in this function are the 
Department of the Interior (including the National Park 
Service, the Bureau of Land Management, the Bureau of 
Reclamation, the Fish and Wildlife Service, and the Minerals 
Management Service), conservation-oriented and land management 
agencies within the Department of Agriculture (including the 
Forest Service), the National Oceanic and Atmospheric 
Administration at the Department of Commerce, the Army Corps of 
Engineers, and the Environmental Protection Agency (EPA).
Senate Resolution
      The Senate resolution calls for a total of $32.9 billion 
in BA and $34.9 billion in outlays for 2008, and $169.7 billion 
in BA and $176.4 billion in outlays over five years. The Senate 
resolution includes $8.1 billion for the EPA. This is $877 
million above the President's request and $170 million above 
the 2007 level adjusted for inflation. In nominal dollars, the 
President's proposed 2008 funding level of $7.2 billion would 
be the lowest budget for EPA since 1997. The Senate resolution 
assumes $1.5 billion for Superfund, an increase of $211 million 
above the President's request. The Senate resolution also 
assumes full funding for EPA's programs to support clean and 
safe drinking water. It rejects the President's proposal to cut 
a variety of environmental protection programs.
      The Senate resolution rejects the President's proposal to 
permit oil and gas leasing in the Arctic National Wildlife 
Refuge (ANWR) and does not assume savings from the proposal. 
The Senate resolution also does not assume any savings from the 
President's proposal to sell Federal lands.
      It rejects the proposal in the President's budget to 
reallocate the repayment of the capital costs of the Pick-Sloan 
Missouri Basin irrigation program to power customers. The 
resolution recognizes the importance of the Bureau of 
Reclamation rural water program to support ongoing Municipal, 
Rural, and Industrial (MR&I;) systems for the Great Plains 
Region. The Bureau of Reclamation supplies drinking water to 
2.6 million people in the Great Plains region and is encouraged 
to prioritize the completion of the Pick Sloan-Missouri Basin 
Program--Garrison Diversion Unit, the Mni Wiconi Project, Dry 
Prairie, Perkins County, and the Lewis and Clark projects. 
Together, these projects have a capability of $200 million. The 
resolution supports funding these projects at a level that is 
as close as possible to the full capability for these vital 
rural water development projects. The Senate resolution adds 
funding for the Forest Service.
House Amendment
      The House amendment reflects a total of $32.8 billion in 
BA and $34.9 billion in outlays for 2008 and $172.2 billion in 
BA and $178.3 billion in outlays over five years. The House 
amendment rejects the President's proposed cuts to priority 
programs, such as the Land and Water Conservation Fund, the 
Fish and Wildlife Service's wildlife refuge system, the EPA's 
grants to States and Tribes to address water and air quality, 
and other EPA programs. It also includes funding to address 
high-priority brownfield redevelopment concerns. In addition, 
the amendment accommodates the President's recommendation to 
increase funding for the operation and maintenance of the 
national park system. The House amendment includes a deficit-
neutral reserve fund to facilitate the reauthorization of the 
Farm Bill, providing resources for such objectives as to secure 
an economic safety net for agricultural producers, conserve our 
natural resources, and address nutrition needs.
Conference Agreement
      The conference agreement includes $33.4 billion in BA and 
$35.2 billion in outlays for 2008, and $173.2 billion in BA and 
$179.3 billion in outlays over five years. The funding levels 
in the conference agreement assume that if the severity of the 
fire season requires additional funding, wildland fire 
suppression activities will be funded for 2008 at no less than 
$400 million above the ten-year average at the Forest Service 
and $100 million above the ten-year average at the Department 
of the Interior.

                       Agriculture: Function 350

Function Summary
      The Agriculture function includes farm income 
stabilization, agricultural research, and other services 
administered by the U.S. Department of Agriculture. The 
discretionary programs include research and education programs, 
economics and statistics services, administration of the farm 
support programs, farm loan programs, meat and poultry 
inspection, and a portion of the Public Law 480 international 
food aid program. The mandatory programs include commodity 
programs, crop insurance, and certain farm loans.
Senate Resolution
      The Senate resolution reflects a total of $20.5 billion 
in BA and $21.5 billion in outlays for 2008 and $105.0 billion 
in BA and $102.9 billion in outlays over five years. With the 
2002 Farm Bill expiring this year, the Senate resolution 
provides a deficit-neutral reserve fund for the reauthorization 
of agricultural programs. To address the needs of rural America 
and promote new sources of renewable energy from U.S. farm 
products, it would provide a $15.0 billion deficit-neutral 
reserve fund for the 2007 through 2012 period to reauthorize 
the Farm Bill. The reauthorization of the Farm Bill will 
provide an economic safety net for agricultural producers, 
enhance the stewardship of our natural resources, address 
domestic nutrition needs, increase agricultural research, and 
improve our export competitiveness.
House Amendment
      The House amendment reflects a total of $20.4 billion in 
BA and $19.5 billion in outlays for 2008 and $105.0 billion in 
BA and $101.0 billion in outlays over five years. The amendment 
provides sufficient funding to bolster commodity support, 
agricultural research, and animal and plant inspection 
programs. The amendment includes a deficit-neutral reserve fund 
to facilitate the reauthorization of the Farm Bill, providing 
resources for such objectives as to secure an economic safety 
net for agricultural producers, conserve our natural resources, 
and address nutrition needs.
Conference Agreement
      The conference agreement includes a total of $20.5 
billion in BA and $19.6 billion in outlays for 2008, and $105.5 
billion in BA and $101.5 billion in outlays over five years. 
The conference agreement includes a deficit-neutral reserve 
fund (Section 307) to provide up to an additional $20.0 billion 
for the 2007 Farm Bill to improve the economic safety net for 
farmers, address domestic nutrition needs, enhance conservation 
programs, and encourage the production of renewable energy 
resources and other purposes.

               Commerce and Housing Credit: Function 370

Function Summary
      The Commerce and Housing Credit function includes 
mortgage credit, the Postal Service, deposit insurance, and 
other advancement of commerce (the majority of the 
discretionary and mandatory spending in this function). The 
mortgage credit component of this function includes housing 
assistance through the Federal Housing Administration, the 
Federal National Mortgage Association (Fannie Mae), the Federal 
Home Loan Mortgage Corporation (Freddie Mac), the Government 
National Mortgage Association (Ginnie Mae), and rural housing 
programs of the Department of Agriculture. The function also 
includes net Postal Service spending and spending for deposit 
insurance activities of banks, thrifts, and credit unions. Most 
of the Commerce Department is provided for in this function, 
including the International Trade Administration, the Bureau of 
Economic Analysis, the Patent and Trademark Office, the 
National Institute of Standards and Technology, the National 
Telecommunications and Information Administration, and the 
Bureau of the Census. Finally, the function also includes 
funding for independent agencies such as the Securities and 
Exchange Commission, the Commodity Futures Trading Commission, 
the Federal Trade Commission, the Federal Communications 
Commission, and the majority of the Small Business 
Administration.
Senate Resolution
      The Senate resolution calls for a total of $10.7 billion 
in unified BA and $3.7 billion in unified outlays for 2008, and 
$47.8 billion in unified BA and $7.1 billion in unified outlays 
over five years. The Senate resolution rejects the President's 
proposal to cut assistance to America's small businesses. The 
President has tried repeatedly to reduce the Manufacturing 
Extension Program (MEP), which helps small businesses adopt 
advanced manufacturing technologies, but Congress has 
consistently restored the funding. The Senate resolution 
restores cuts to this vital program. The Senate resolution also 
provides robust resources for the Small Business 
Administration.
House Amendment
      The House amendment reflects a total of $11.0 billion in 
unified BA and $3.8 billion in unified outlays for 2008 and 
$55.0 billion in unified BA and $13.9 billion in unified 
outlays over five years. The House amendment's discretionary 
function total includes significantly increased funding for the 
Bureau of Census, reflecting continued preparation for the 2010 
census. For 2008, and over the following four years, funding in 
Function 370 is above the level in the President's budget.
Conference Agreement
      The conference agreement calls for a total of $11.1 
billion in unified BA and $3.8 billion in unified outlays for 
2008, and $55.1 billion in unified BA and $14.1 billion in 
unified outlays over five years.

                      Transportation: Function 400

Function Summary
      The Transportation function consists mostly of the 
programs administered by the Department of Transportation, 
including programs for highways, mass transit, aviation, and 
maritime activities. This function also includes two components 
of the Department of Homeland Security: the Coast Guard and the 
Transportation Security Administration. In addition, this 
function includes several small transportation-related agencies 
and the research program for civilian aviation at NASA.
Senate Resolution
      The Senate resolution calls for a total of $83.9 billion 
in BA and $81.4 billion in outlays for 2008, and $390.2 billion 
in BA and $425.3 billion in outlays over five years. The Senate 
resolution provides $1.8 billion in BA for Amtrak, a funding 
level that is $880 million above the President's request and 
$480 million above the 2007 level adjusted for inflation. 
Amtrak is a vital link to many small communities, and the 
Senate resolution will help Amtrak pay off debt and continue to 
improve its operations. The Senate resolution also provides 
full funding for highway, safety, and transit programs.
House Amendment
      The House amendment reflects a total of $82.7 billion in 
BA and $80.8 billion in outlays for 2008 and $393.7 billion in 
BA and $426.7 billion in outlays over five years. It fully 
funds the highway, safety, and transit programs authorized in 
the Safe, Accountable, Flexible, Efficient Transportation 
Equity Act: A Legacy for Users (SAFETEA-LU). Specifically, the 
House amendment includes both the revenue aligned budget 
authority (RABA) and the funding for transit capital projects 
that the President's 2008 budget cuts. In addition, the House 
amendment maintains Amtrak, provides additional funding for 
grants to airports, and rejects the President's cuts to 
aviation programs within NASA.
Conference Agreement
      The conference agreement provides a total of $82.8 
billion in BA and $81.1 billion in outlays for 2008 and $393.2 
billion in BA and $426.1 billion in outlays over five years. 
The conference agreement fully funds the highway, safety, and 
transit programs authorized in the Safe, Accountable, Flexible, 
Efficient Transportation Equity Act: A Legacy for Users 
(SAFETEA-LU). Specifically, the conference agreement includes 
the revenue aligned budget authority (RABA) that the 
President's 2008 budget cuts. Among other transportation 
programs, the conference agreement provides $1.8 billion in BA 
for Amtrak.

            Community and Regional Development: Function 450

Function Summary
      The Community and Regional Development function includes 
federal programs to improve community economic conditions, 
promote rural development, and assist in federal preparations 
for and response to disasters. This function provides 
appropriated funding for the Community Development Block Grant 
(CDBG), Department of Agriculture rural development programs, 
the Bureau of Indian Affairs, the Federal Emergency Management 
Agency (including homeland security grants), and other disaster 
mitigation and community development-related programs. It also 
provides mandatory funding for the federal flood insurance 
program.
Senate Resolution
      The Senate resolution calls for a total of $15.4 billion 
in BA and $22.5 billion in outlays for 2008, and $70.7 billion 
in BA and $96.9 billion in outlays over five years. This level 
restores cuts proposed in the President's budget for community 
development programs and several Department of Homeland 
Security (DHS) grant programs, including first responder 
grants. In addition, the Senate resolution includes increases 
in funding for security grant programs relating to port 
security, rail and transit security, interoperable 
communications equipment, and emergency management performance 
grants.
House Amendment
      The House amendment reflects a total of $15.0 billion in 
BA and $22.0 billion in outlays in 2008, and $71.9 billion in 
BA and $94.5 billion in outlays over five years. The House 
amendment provides more than the President's 2008 discretionary 
funding level for Function 450, rejecting the President's cuts 
to the Community Development Block Grant (CDBG) program and 
providing additional funds for this and other key priorities 
like rural development and disaster preparedness.
Conference Agreement
      The conference agreement includes a total of $15.8 
billion in BA and $22.3 billion in outlays for 2008, and $76.0 
billion in BA and $97.6 billion in outlays over five years. The 
conference agreement provides funding for continued investments 
in and additional resources for community development and 
homeland security, including community development block 
grants, interoperable communications equipment grants, and 
emergency management performance grant programs.

   Education, Training, Employment, and Social Services: Function 500

Function Summary
      The Education, Training, Employment and Social Services 
function includes funding for the Department of Education, as 
well as programs in the Department of Health and Human Services 
(HHS) and the Department of Labor. This function provides 
funding for elementary and secondary, career and technical, and 
post-secondary educational programs; job training and 
employment services; children and family services; and 
statistical analysis and research related to these areas. It 
also contains funding for the Library of Congress and 
independent research and art agencies such as the Corporation 
for Public Broadcasting, the Smithsonian Institution, the 
National Gallery of Art, the John F. Kennedy Center for the 
Performing Arts, the National Endowment for the Arts, and the 
National Endowment for the Humanities.
Senate Resolution
      The Senate resolution calls for a total of $93.9 billion 
in BA and $90.4 billion in outlays in 2008 and $490.6 billion 
in BA and $478.0 billion in outlays over five years. The Senate 
resolution provides $2.0 billion in 2009 advance funding for 
Function 500 programs.
      The Senate resolution recognizes that investments in 
education and training programs are critical to our nation's 
long-term economic outlook and provides $9.3 billion above the 
President's 2008 discretionary request for this function, 
including $2.0 billion in advance 2009 funding. Specifically, 
the Senate resolution rejects the President's proposed cuts and 
provides the largest increase since 2002 for elementary and 
secondary programs, particularly for Title I, the Individuals 
with Disabilities Education Act (IDEA), and Impact Aid. The 
Senate resolution provides an increase for Head Start and fully 
accommodates the President's proposed increases in the maximum 
Pell grant.
      The Senate resolution provides a deficit-neutral reserve 
fund to facilitate enactment of legislation to improve college 
access and affordability. The Senate resolution provides $100 
million for summer education programs, and a deficit-neutral 
reserve fund to facilitate enactment of legislation to provide 
assistance to States for offering or expanding preschool for 
children from low-income families. The Senate resolution allows 
the Chairman of the Budget Committee to revise the levels in 
the resolution for legislation appropriating up to $17 million 
for 2008 if the Comptroller General makes certain 
certifications to Congress regarding the Smithsonian 
Institution.
House Amendment
      The House amendment calls for a total of $92.5 billion in 
BA and $91.1 billion in outlays for 2008 and $484.7 billion in 
BA and $475.3 billion in outlays over five years. The House 
amendment specifically rejects the President's cuts to 
education, including his plan to eliminate many education 
programs. The amendment also rejects the President's steep cuts 
to job training and social services programs, including the 
Community Services Block Grant and the Social Services Block 
Grant.
      In contrast to the President's funding cuts, the House 
amendment makes a down payment toward addressing long-standing 
needs in education, training, and social services. To that end, 
the amendment provides an appropriated program level for 
Function 500 that is $7.9 billion above the 2008 level in the 
President's budget. Those additional resources include $5.9 
billion in 2008 funding and an increase of $2.0 billion in 
advance 2009 funding.
      The House amendment's increased funding could be used for 
vital programs that help children and adults who most need 
assistance, including Head Start, Title I and other elementary 
and secondary education programs authorized under the No Child 
Left Behind Act, and employment training and national service 
programs such as VISTA. The additional funding also could 
bolster the federal government's commitment to cover a growing 
share of the cost of special education under the Individuals 
with Disabilities Education Act. Finally, the increased funds 
could help secure college access, equity, and success for every 
American by raising the maximum Pell Grant to at least $4,600, 
maintaining Supplemental Opportunity Educational Grants and the 
Leveraging Educational Assistance Partnerships, and broadening 
access to Hispanic-serving institutions, Historically Black 
Colleges and Universities, and other high-quality educational 
opportunities.
      The House amendment also contains a reserve fund to 
accommodate legislation that makes college more affordable.
Conference Agreement
      The conference agreement includes $93.9 billion in BA and 
$91.0 billion in outlays in 2008 as well as $2.0 billion in 
advance 2009 funding, and $492.3 billion in BA and $480.1 
billion in outlays over five years. For 2008, the conference 
agreement provides $7.5 billion above the President in 
discretionary BA, plus the additional $2.0 billion in advance 
BA for 2009. The conference report rejects the President's 
program eliminations and cuts. Additional funding is provided 
for investments in educational opportunities, social services, 
and job training.
      The conference agreement recognizes that funding for 
education programs has been insufficient to meet the mandates 
created by federal laws, and, even more important, to ensure 
that every child receives a world-class education. The 
agreement envisions significant investments in this area.
      The conference agreement recognizes that early childhood 
education programs provide a sound return on investment. 
Despite efforts to increase preschool programs at the state 
level, the conference agreement acknowledges that many 
preschool children do not have access to early childhood 
education programs and further investments should be considered 
at the federal level. The conference agreement also contains a 
reserve fund to accommodate legislation that makes college more 
affordable.

                          Health: Function 550

Function Summary
      The Health function includes most direct health care 
service programs as well as funding for anti-bioterrorism 
activities, national biomedical research, protecting the health 
of the general population and workers in their places of 
employment, providing health services for under-served 
populations, and promoting training for the health care 
workforce. The major programs in this function include 
Medicaid, the State Children's Health Insurance Program 
(SCHIP), health benefits for federal workers and retirees, the 
National Institutes of Health (NIH), the Food and Drug 
Administration (FDA), the Health Resources and Services 
Administration (HRSA), the Centers for Disease Control and 
Prevention (CDC), the Substance Abuse and Mental Health 
Services Administration (SAMHSA), the Indian Health Service 
(IHS), and the Agency for Healthcare Research and Quality.
Senate Resolution
      The Senate resolution calls for a total of $291.3 billion 
in BA and $290.2 billion in outlays for 2008, and $1.7 trillion 
in BA and $1.7 trillion in outlays over five years. The Senate 
resolution includes increases above the 2007 enacted level 
adjusted for inflation for NIH, HRSA, CDC, FDA, and IHS. 
Significant increases for Community Health Centers and health 
professions within HRSA are also included. The Senate 
resolution assumes funding for the last phase of HHS' National 
Strategy for Pandemic Influenza. The resolution rejects the 
President's proposed $146 million cut for Rural Health 
Activities in HRSA. The resolution also supports funding 
demonstration programs to provide patient navigator services as 
authorized in the Patient Navigator, Outreach, and Chronic 
Disease Prevention Act under HRSA. In addition, the Senate 
resolution contains various health care related deficit-neutral 
reserve funds, including a reserve fund for SCHIP legislation.
House Amendment
      The House amendment calls for a total of $286.8 billion 
in BA and $286.3 billion in outlays for 2008 and $1.6 trillion 
in BA and outlays over five years. The discretionary resources 
for Function 550 for 2008 represent an increase over both the 
2007 level and the President's request. The House amendment 
increases resources for public health programs to provide for 
advances in science, improvements in health, access to quality 
health care for underserved populations, and other critical 
programs.
      Programs in Function 550 are also addressed in the House 
amendment's deficit-neutral reserve funds for SCHIP and for 
Transitional Medical Assistance.
Conference Agreement
      The conference agreement includes a total of $287.5 
billion in BA and $286.4 billion in outlays for 2008, and $1.6 
trillion in BA and $1.6 trillion in outlays over five years. In 
addition to increases for other health agencies, the conference 
agreement includes significant increases for Community Health 
Centers and the National Health Service Corps within HRSA as 
well as funding for patient navigator services. The conference 
agreement also contains several health care related deficit-
neutral reserve funds, including a reserve fund for SCHIP 
legislation.

                         Medicare: Function 570

Function Summary
      The Medicare function includes funding to administer and 
to provide benefits under the Medicare program. Medicare is a 
federal health insurance program that currently covers 43 
million Americans aged 65 and older, as well as younger adults 
who are disabled or suffer from end-stage renal disease.
      Congress provides an annual appropriation for the costs 
of administering Medicare, including resources to conduct 
program integrity activities to guard against improper 
payments, fraud, and abuse. The remainder of spending in this 
function is mandatory and reflects payments to health care 
providers and private insurance plans, as well as beneficiary 
premiums and other receipts and payments to the Medicare trust 
funds, under the Part A Hospital Insurance (HI) program, the 
Part B Supplementary Medical Insurance (SMI) program, the Part 
C Medicare Advantage program, and the Part D Prescription Drug 
program.
Senate Resolution
      The Senate resolution calls for a total of $390.0 billion 
in BA and $390.0 billion in outlays for 2008, and $2.2 trillion 
in BA and $2.2 trillion in outlays over five years. For 2008, 
the discretionary funding levels in this function include a 
discretionary cap adjustment of up to $383 million for program 
integrity activities of the Health Care Fraud and Abuse Control 
(HCFAC program) to address improper payments, fraud, and abuse 
in the Medicare program. In addition, the mandatory funding 
levels in this function assume Medicare savings of $15.0 
billion over five years from reducing certain overpayments to 
health care providers. Specific policies to enact these savings 
will be determined by the Senate Finance Committee. The 
function also assumes an additional savings of $400 million 
over five years to offset SCHIP shortfall legislation.
House Amendment
      The House amendment reflects a total of $389.6 billion in 
BA and $389.7 billion in outlays in 2008, and $2.2 trillion in 
BA and $2.2 trillion in outlays over five years. It assumes the 
extension of Medicare premium assistance for qualified 
individuals with incomes between 120 and 135 percent of the 
federal poverty level and limited financial resources. The 
amendment assumes that savings from Medicare program efficiency 
improvements will offset the costs of extending the premium 
assistance program as well as other initiatives to improve the 
Medicare program for beneficiaries.
      The House amendment assumes targeted assistance to 
hospitals with 100 beds or more that have faced a reduction in 
Medicare disproportionate share hospital payments due to 
assignment to a Micropolitan area.
      The amendment accommodates a discretionary cap adjustment 
of $183 million for additional activities aimed at detecting 
and preventing Medicare fraud. The Health Care Fraud and Abuse 
Control program--a joint effort of the Department of Health and 
Human Services, the HHS Office of Inspector General, and the 
Department of Justice--generated roughly $4 in program savings 
for every dollar spent in 2004 and 2005.
      The House amendment also contains a reserve fund to 
accommodate legislation for Medicare program improvements.
Conference Agreement
      The conference agreement reflects a total of $389.6 
billion in BA and $389.7 billion in outlays in 2008, and $2.2 
trillion in BA and $2.2 trillion in outlays over five years. 
Discretionary and mandatory spending levels in this function 
are consistent with the CBO baseline funding levels.
      For fiscal year 2008, the discretionary funding levels in 
Function 920 include a discretionary cap adjustment of up to 
$383 million for program integrity activities of the Health 
Care Fraud and Abuse Control (HCFAC) program, to address 
improper payments, fraud and abuse in the Medicare program.

                     Income Security: Function 600

Function Summary
      The Income Security function contains a range of income 
security programs including: (1) major cash and in-kind means-
tested entitlements; (2) general retirement, disability, and 
pension programs excluding Social Security and veterans' 
compensation programs; (3) federal and military retirement 
programs; (4) unemployment compensation; (5) low-income housing 
programs; and (6) other low-income support programs. Major 
federal entitlement programs in this function include 
unemployment insurance, food stamps, child nutrition, Temporary 
Assistance to Needy Families (TANF), foster care, child support 
enforcement, child care, Supplemental Security Income, and 
spending for the refundable portion of the Earned Income 
Credit.
Senate Resolution
      The Senate resolution calls for a total of $379.8 billion 
in BA and $383.6 billion in outlays for 2008, and $2.0 trillion 
in BA and $2.0 trillion in outlays over five years. The Senate 
resolution includes increases for the Low-Income Home Energy 
Assistance Program to continue providing heating and cooling 
assistance to over five million low income households, 
including the working poor, disabled persons, elderly, and 
families with young children. The Senate resolution also 
includes a deficit-neutral reserve fund to provide up to an 
additional $5.0 billion in mandatory child care funding.
House Amendment
      The House amendment calls for a total of $379.9 billion 
in BA and $383.5 billion in outlays for 2008 and $2.0 trillion 
in BA and outlays over five years. The House amendment provides 
increased funding that could be used to meet urgent needs 
related to Hurricane Katrina recovery and to begin addressing 
long-ignored challenges facing children and families, including 
large backlogs in the Social Security disability system. The 
amendment also includes a deficit-neutral reserve fund to 
facilitate the reauthorization of the Farm Bill, providing 
resources for such objectives as to secure an economic safety 
net for agricultural producers, conserve our natural resources, 
and address nutrition needs.
Conference Agreement
      The conference agreement includes a total of $380.8 
billion in BA and $384.3 billion in outlays for 2008, and $2.0 
trillion in BA and $2.0 trillion in outlays over five years. 
The total includes increased funding for the Low-Income Home 
Energy Assistance Program, critical Hurricane Katrina recovery 
efforts, and other challenges, including a reduction of Social 
Security disability backlogs. The total Income Security funding 
level in the conference report (including Function 920) also 
assumes the President's full request for a cap adjustment for 
program integrity efforts, including additional funding for in-
person reemployment and eligibility assessments and 
unemployment insurance improper payment reviews, but does not 
assume enactment of proposals which would adversely affect 
workers who have received unemployment benefits. The conference 
agreement also includes a deficit-neutral reserve fund to 
provide up to an additional $5.0 billion in mandatory child 
care funding and a farm bill reserve fund which accommodates 
nutrition needs.

                     Social Security: Function 650

Function Summary
      The Social Security function includes funding for the 
Old-Age, Survivors, and Disability Insurance (OASDI) programs, 
which provide earned Social Security benefits to nearly 50 
million eligible retired workers, disabled persons, and their 
spouses and survivors. In addition, this function provides 
funding to the Social Security Administration (SSA) and the 
Office of the Inspector General (OIG) to administer the Social 
Security program and ensure program integrity.
      Under provisions of the Congressional Budget Act and the 
Budget Enforcement Act, the Old-Age and Survivors Insurance 
(OASI) trust fund and the Disability Insurance (DI) trust fund 
are off-budget and do not appear in the budget resolution 
totals. A small portion of spending in Function 650, the 
general fund transfer of income taxes on Social Security 
benefits to the trust funds, is considered on-budget and 
appears in the budget resolution totals.
Senate Resolution
      The Senate resolution calls for $19.6 billion in on-
budget BA and outlays for 2008, and $121.8 billion in on-budget 
BA and outlays over five years. (The corresponding figures on a 
unified basis are $615.3 billion in BA and $612.8 billion in 
outlays for 2008 and $3.4 trillion in BA and outlays over five 
years.) This spending reflects the general fund transfer of 
income taxes on Social Security benefits to the trust funds.
      For 2008, the Senate resolution provides $5.1 billion in 
BA and $5.1 billion in outlays for SSA administrative expenses, 
as outlined in section 102(c) of the resolution, which 
represents a $297 million increase over the President's 
request. The additional funding is intended to help address the 
serious and growing backlog of Social Security disability 
claims and hearings.
House Amendment
      The House amendment reflects $19.6 billion in on-budget 
BA and outlays for 2008, and $121.8 billion in on-budget BA and 
outlays over five years. (The corresponding figures on a 
unified basis are $615.0 billion in BA and $612.6 billion in 
outlays for 2008 and $3.4 trillion in BA and outlays over five 
years.) It rejects the President's private account proposal for 
Social Security.
      The administrative budget for the Social Security 
Administration (SSA) includes resources in Function 570 
(Medicare) and Function 600 (Income Security) as well as 
Function 650. The House amendment assumes a $9.9 billion 
discretionary funding level for SSA. The additional resources 
will prevent increases in the backlogs of disability decisions 
and hearings that would occur under the President's budget. The 
House amendment will enable SSA to address the significant 
number of individuals waiting for disability and hearing 
decisions.
      The House amendment also accommodates an additional $213 
million through a discretionary cap adjustment for program 
integrity initiatives. The cap adjustment allows the agency to 
conduct an increasing number of Continuing Disability Reviews 
(CDRs) and Supplemental Security Income redeterminations.
Conference Agreement
      The conference agreement includes $19.6 billion in on-
budget BA and outlays for 2008, and $121.8 billion in on-budget 
BA and outlays over five years. (The corresponding figures on a 
unified basis are $615.0 billion in BA and $612.6 billion in 
outlays for 2008 and $3.4 trillion in BA and outlays over five 
years.) The discretionary and mandatory funding levels in this 
function are consistent with the CBO baseline.
      For 2008, the conference agreement provides total net 
resources for the administrative expenses of SSA and the OIG 
(across all relevant functions) of $10.1 billion, $430 million 
above the President's requested level. The total SSA funding 
level in the conference agreement assumes both the President's 
full request for a cap adjustment in Function 920 for program 
integrity efforts (including continuing disability reviews 
(CDRs) and SSI redeterminations) as well as additional 
resources in Function 600 to address the disability hearings 
and claims backlog.

              Veterans Benefits and Services: Function 700

Function Summary
      The Veterans Benefits and Services function covers the 
programs of the Department of Veterans Affairs (VA), including 
veterans' medical care, compensation and pensions, education 
and rehabilitation benefits, and housing programs. It also 
includes the Department of Labor's Veterans' Employment and 
Training Service, the United States Court of Appeals for 
Veterans Claims, and the American Battle Monuments Commission.
Senate Resolution
      The Senate resolution calls for a total of $85.3 billion 
in BA and $84.4 billion in outlays for 2008, and $448.4 billion 
in BA and $446.8 billion in outlays over five years. The Senate 
resolution provides $43.1 billion in BA in 2008 for 
discretionary veterans' programs, including medical care. This 
amount is $3.6 billion more than the President's proposed 
funding level and represents 98 percent of the level requested 
in The Independent Budget, a plan developed by four leading 
veterans' groups. The funding in the Senate resolution will 
ensure that the Veterans Health Administration within VA can 
provide the highest quality health care for all veterans.
      In 2005, the President's budget underfunded the Veterans 
Health Administration, and VA was forced to ask Congress for 
two supplemental funding requests. The Senate resolution 
provides full funding to ensure that VA can meet its 
obligations to veterans.
      The Senate supports the determination that robust 
resources are needed by VA to address the backlog and delay in 
the disability evaluation and claims process, and that funding 
should be dedicated to address and improve this process.
House Amendment
      The House amendment reflects a total of $85.2 billion in 
BA and $82.8 billion in outlays for 2008, and $452.8 billion in 
BA and $448.2 billion in outlays over five years. For 2008, the 
House amendment provides $6.6 billion of discretionary BA over 
the 2007 level, for a level that is $3.5 billion above the 2008 
funding in the President's budget. The amendment reflects the 
high priority of adequately funding veterans programs. It 
rejects the veterans' health care enrollment fees and co-
payment increases that were imposed by the President's budget.
      The House amendment provides full funding to support 
excellent health care for veterans and current service members. 
In particular, the House amendment provides funding to begin 
implementing future recommendations of the President's 
Commission on Care for America's Returning Wounded Warriors 
(the bi-partisan ``Walter Reed Commission'') and other United 
States Government investigations into military and veterans' 
health care facilities and services.
      The House amendment provides additional funding in 
Function 700 above the President's requested levels for 2008 to 
address important priorities including veterans' mental health, 
post-traumatic stress disorder, traumatic brain injury, and 
spinal cord injury. The amendment also has additional funding 
for disability compensation claims processing so that VA can 
significantly reduce the inventory of pending claims.
Conference Agreement
      The conference agreement provides a total of $85.3 
billion in BA and $84.4 billion in outlays for 2008 and $452.8 
billion in BA and $450.9 billion in outlays over five years. 
The conference agreement provides $43.1 billion in 2008 for 
discretionary veterans' programs, including medical care. This 
amount is $6.7 billion more than the 2007 enacted level and 
$3.6 billion more than the President's proposed funding level 
for 2008. This level is consistent with the Independent Budget, 
a plan developed by four leading veterans' groups, and 
recommendations of the American Legion.

                Administration of Justice: Function 750

Function Summary
      The Administration of Justice function includes funding 
for federal law enforcement activities at the Department of 
Justice (DOJ) including criminal investigations by the Federal 
Bureau of Investigation (FBI) and the Drug Enforcement Agency 
(DEA). The function also includes funding for border 
enforcement by the Department of Homeland Security (DHS). 
Additionally, the function includes funding for civil rights 
enforcement and prosecution; federal block, categorical, and 
formula law enforcement grant programs to state and local 
governments; prison construction and operation; the United 
States Attorneys; and the federal judiciary.
Senate Resolution
      The Senate resolution calls for a total of $48.8 billion 
in BA and $47.1 billion in outlays for 2008, and $242.8 billion 
in BA and $242.9 billion in outlays over five years. This level 
restores cuts proposed in the President's budget and provides 
additional resources for several law enforcement grant programs 
such as COPS, including meth hotspot grants, and the Edward 
Byrne Memorial Justice Assistance Grant program. In addition, 
the Senate resolution restores cuts and provides additional 
resources to the State Criminal Alien Assistance Program. The 
Senate resolution also includes increases in funding proposed 
in the President's budget for border security.
House Amendment
      The House amendment reflects a total of $46.9 billion in 
BA and $46.2 billion in outlays in 2008, and $238.2 billion in 
BA and $238.3 billion outlays over five years. The House 
amendment rejects the cuts to local law enforcement and first 
responders in the President's budget, including cuts to the 
Edward Byrne Memorial Justice Assistance Grant program. The 
amendment provides funding above the President's budget level 
for 2008 for that purpose and for purposes such as protecting 
the borders and funding the 
9/11 Commission recommendations.
Conference Agreement
      The conference agreement includes a total of $48.0 
billion in BA and $47.1 billion in outlays for 2008, and $246.8 
billion in BA and $246.4 billion in outlays over five years. 
The agreement continues funding for local law enforcement, 
including Edward Byrne Memorial Justice Assistance Grants and 
COPS grants. In addition, the agreement also provides resources 
to help meet the 9/11 Commission recommendations and to protect 
the borders.

                    General Government: Function 800

Function Summary
      The General Government function consists of the 
activities of the Legislative Branch, the Executive Office of 
the President, general tax collection and fiscal operations of 
the Department of the Treasury (including the IRS), the Office 
of Personnel Management, the property and personnel costs of 
the General Services Administration, and general purpose fiscal 
assistance to states, localities, the District of Columbia, and 
U.S. territories.
Senate Resolution
      The Senate resolution calls for $18.8 billion in BA and 
$19.1 billion in outlays for 2008 and $98.6 billion in BA and 
$98.6 billion in outlays over five years. The Senate resolution 
fully funds the President's budget request for the IRS, 
including additional resources available through a 
discretionary cap adjustment that directs $406 million to IRS 
enforcement activities. The Senate resolution includes reserve 
funds to accommodate legislation to reduce the deficit by 
reducing improper payments and requiring recovery audits. It 
also includes a deficit-neutral reserve fund to accommodate 
legislation that reauthorizes the Secure Rural Schools and 
Community Self-Determination Act of 2000. The expiration of 
this law would have a significant impact on rural communities. 
The Senate resolution also includes funding for a Commission on 
Budgetary Accountability and Review of Federal Agencies.
House Amendment
      The House amendment reflects a total of $18.6 billion in 
BA and $19.0 billion in outlays for 2008 and $99.8 billion in 
BA and $99.7 billion in outlays over five years. The House 
amendment includes a program integrity initiative to increase 
Internal Revenue Service tax compliance efforts to collect 
unpaid taxes from those who are not paying what they owe. The 
funding in this function is adequate to provide for the 
reestablishment of the Office of Technology Assessment. The 
amendment also includes a deficit-neutral reserve fund to 
accommodate legislation that reauthorizes the Secure Rural 
Schools and Community Self-Determination Act of 2000.
Conference Agreement
      The conference agreement includes $18.6 billion in BA and 
$19.0 billion in outlays for 2008, and $99.7 billion in BA and 
$99.6 billion in outlays over five years. It fully funds the 
President's budget request for the IRS, including additional 
resources available through a discretionary cap adjustment 
(included in Function 920) that directs $406 million to IRS 
enforcement activities. The conference agreement includes a 
deficit-neutral reserve fund to accommodate legislation that 
provides for the reauthorization of the Secure Rural Schools 
and Community Self-Determination Act of 2000, or makes changes 
to the Payments in Lieu of Taxes Act of 1976, or both.

                       Net Interest: Function 900

Function Summary
      The Net Interest function is entirely mandatory with no 
discretionary components. It consists primarily of the interest 
paid by the federal government to private and foreign 
government holders of U.S. Treasury securities. It includes the 
interest on the public debt after deducting the interest income 
received by the federal government from trust fund investments, 
loans and cash balances, and earnings of the National Railroad 
Retirement Investment Trust.
      The Federal government's net interest payments on its 
debt increased by 48 percent between 2003 and 2006 and is now 
one of the largest components of the federal budget.
Senate Resolution
      The Senate resolution calls for BA and outlays of $255.5 
billion in unified net interest payments in 2008 and a total of 
$1.4 trillion over five years.
House Amendment
      The House amendment calls for BA and outlays of $254.6 
billion in unified net interest payments in 2008 and a total of 
$1.4 trillion over five years.
Conference Agreement
      The conference agreement includes BA and outlays of 
$255.7 billion in unified net interest payments in 2008 and a 
total of $1.4 trillion over five years.

                        Allowances: Function 920

Function Summary
      The Allowances function is used for planning purposes to 
address the budgetary effects of proposals or assumptions that 
cross several budget functions. Once such changes are enacted, 
the budgetary effects are distributed to the appropriate budget 
function.
Senate Resolution
      The Senate resolution calls for a total of -$16.7 billion 
in BA and -$7.5 billion in outlays for 2008, and -$46.5 billion 
in BA and -$38.1 billion in outlays over five years.
House Amendment
      The House amendment did not include any spending or cuts 
in Function 920.
Conference Agreement
      The conference agreement includes a total of -$6.4 
billion in BA and -$2.2 billion in outlays for 2008, and -$35.2 
billion in BA and -$30.0 billion in outlays over five years. 
These funding levels reflect adjustments for program integrity 
and other non-security adjustments.

            Undistributed Offsetting Receipts: Function 950

Function Summary
      The Undistributed Offsetting Receipts function includes 
major offsetting receipt items that would distort the funding 
levels of other functional categories if they were distributed 
to them. Examples of such items include the employer share of 
federal employee retirement benefits, outer continental shelf 
rents and royalties, and the sale of major assets.
Senate Resolution
      The Senate resolution calls for unified undistributed 
offsetting receipts of -$84.7 billion in BA and outlays for 
2008 and -$422.1 billion over five years. That amount generally 
matches CBO's baseline estimate of undistributed offsetting 
receipts, with the exception that it assumes -$775 million in 
2008 and -$3.1 billion over the 2008-2012 period in additional 
offsetting receipts from legislation to provide a remedy for 
errors in certain oil and gas leases.
House Amendment
      The House amendment represents CBO's baseline estimate of 
unified undistributed offsetting receipts of -$83.9 billion in 
BA and outlays for 2008 and -$419.0 billion over five years.
Conference Agreement
      The conference agreement includes a total of unified 
undistributed offsetting receipts of -$83.9 billion in BA and 
outlays for 2008 and -$419.0 billion over five years.

        Overseas Deployments and Other Activities: Function 970

Function Summary
      This is a new function included in the House amendment, 
consisting of funding for overseas deployments and other 
activities.
Senate Resolution
      The Senate resolution did not include Function 970.
House Amendment
      The House amendment includes the House-passed 
supplemental for 2007 (H.R. 1591) in Function 970 and, as a 
placeholder, accommodates up to the President's funding levels 
for overseas deployments and related activities in 2008 and 
2009.
Conference Agreement
      The Senate recedes to the House amendment to include 
Function 970. As a placeholder, the conference agreement's 
levels accommodate the President's requests for overseas 
deployments and other activities for 2008 and 2009, as well as 
the conference agreement for H.R. 1591, the supplemental 
appropriations bill for 2007 (excluding outyear changes in 
mandatory programs).

                           Budget Enforcement

Senate Resolution
            Sec. 201. Paygo
      Section 201 of the Senate-passed resolution would restore 
the strong paygo, or pay-as-you-go, rule in the Senate. The 
paygo rule requires that new mandatory spending and tax cuts be 
offset or get 60 votes. Reinstating a strong paygo rule 
represents a crucial first step in restoring fiscal discipline. 
Paygo was instrumental in our turning deficits into surpluses 
in the 1990s.
      Paygo does not prohibit new mandatory spending or new tax 
cuts. It simply says that they should be paid for so that the 
deficit isn't worsened. Paygo ensures that if something is not 
paid for, it can only pass if it has broad bipartisan support.
      The current paygo rule, which expires on September 30, 
2008, includes a loophole that exempts all legislation assumed 
in any budget resolution. The Senate resolution would eliminate 
this loophole and apply paygo to all new mandatory spending and 
revenue legislation. It would extend the stronger paygo rule 
through 2017 and effectively repeal the current, weaker version 
of the paygo rule. Consistent with ending this loophole, the 
Senate resolution assumes that all existing balances on the 
Congressional pay-as-you-go ledger would be eliminated, and the 
scorecard reset to zero for all time periods.
      The Senate resolution also clarifies language in the 
paygo rule which prohibits any net savings enacted in any bill 
pursuant to a reconciliation instruction from being made 
available on the paygo ledger. In 1993, the Senate originally 
created the paygo rule as a provision in the FY1994 budget 
resolution (H. Con. Res. 64), specifically for the purpose of 
preventing the deficit reduction expected to be achieved in a 
subsequent reconciliation bill from being used to offset the 
costs of any new mandatory spending or revenue legislation. The 
Senate resolution restores this original intent, by clarifying 
that savings enacted in any reconciliation bill shall never be 
placed on the paygo ledger and used as offsets for another 
reconciliation bill (even if enacted pursuant to reconciliation 
instructions in the same budget resolution) or as offsets for 
any other legislation. For paygo purposes, all net savings 
enacted pursuant to reconciliation are to be dedicated solely 
to deficit reduction.
            Sec. 202. Point of Order Against Reconciliation Legislation 
                    That Would Increase the Deficit or Reduce a Surplus
      Section 202 of the Senate resolution creates a new 60-
vote point of order against reconciliation measures that would 
cause or increase an on-budget deficit or decrease an on-budget 
surplus. Reconciliation is a fast-track process that was 
intended to be used for deficit reduction. Unfortunately, in 
recent years the reconciliation process has been abused as a 
fast-track means of enacting legislation that has dramatically 
worsened deficits and increased our debt.
            Sec. 203. Point of Order Against Long-Term Deficit 
                    Increases
      Section 203 of the Senate resolution establishes a 60-
vote point of order against legislation that would cause a net 
deficit increase in excess of $5.0 billion (including changes 
in revenues and mandatory spending, but excluding debt service) 
in any of the four ten-year periods 2018-2027, 2028-2037, 2038-
2047, or 2048-2057. The provision sunsets at the end of 2017, 
and effectively repeals the long-term spending point of order 
in Section 407 of H. Con. Res. 95, the fiscal year 2006 budget 
resolution conference report.
            Sec. 204. Point of Order Against Emergency Designations
      Under Section 204 of the Senate resolution, all emergency 
designations would be subject to an emergency designation point 
of order, which can only be waived with 60 votes.
            Sec. 205. Extension of 60-Vote Enforcement
      Section 205 of the Senate resolution extends the current 
60-vote enforcement of existing budgetary points of order 
through 2017.
            Sec. 206. Advance Appropriations
      Section 206 of the Senate resolution would provide a 
supermajority point of order against appropriations in fiscal 
year 2008 bills that would first become effective in any year 
after fiscal year 2008, and against appropriations in fiscal 
year 2009 bills that would first become effective in any year 
after 2009. It does not apply against appropriations for the 
Corporation for Public Broadcasting, nor does it apply against 
changes in mandatory programs or deferrals of mandatory budget 
authority from one year to the next. There is an exemption for 
each of fiscal years 2008 and 2009 of up to $25.2 billion for 
the following:

Labor, HHS:
      Employment and Training Administration
      Education for the Disadvantaged
      School Improvement
      Children and Family Services (Head Start)
      Special Education
      Vocational and Adult Education
Financial Services and General Government: Payment to Postal 
Service
Transportation, Housing and Urban Development: Section 8 
Renewals
            Sec. 207. Discretionary Spending Caps
      Currently, there are no discretionary spending limits for 
any fiscal year. Section 207 of the Senate resolution would 
strengthen fiscal responsibility by establishing discretionary 
spending limits for 2007 and 2008, and enforce them with a 
point of order in the Senate that could only be waived with 60 
votes.
      Section 207 of the Senate resolution permits adjustments 
to the discretionary spending limits in 2008 for program 
integrity initiatives, including Social Security Administration 
continuing disability reviews and Supplemental Security Income 
redeterminations, enhanced Internal Revenue Service tax 
enforcement to address the tax gap, appropriations for Health 
Care Fraud and Abuse Control (HCFAC) program at the Department 
of Health and Human Services, and unemployment insurance 
improper payment reviews. It also provides for adjustments in 
2008 and 2009 for war-related expenses.
            Sec. 208. Inapplicability of Previous Allocations
      Because the Senate resolution establishes new 
discretionary spending limits for 2007 and 2008 and new 
committee spending allocations pursuant to section 302(a) of 
the Congressional Budget Act of 1974, Section 208 of the Senate 
resolution clarifies that the ``deeming'' provisions of last 
year's emergency supplemental in Section 7035 of Public Law 
109-234 shall no longer apply in the Senate.
            Sec. 209. Point of Order To Save Social Security First
      Section 209 of the Senate resolution creates a 60-vote 
point of order requiring the President to submit a legislative 
proposal to Congress and requiring Congress to enact 
legislation that would ensure the long-term solvency of Social 
Security, before Congress considers any legislation that would 
worsen budget deficits and weaken the solvency of Social 
Security.
            Sec. 210. Point of Order Against Legislation That Raises 
                    Income Tax Rates
      Section 210 of the Senate resolution would create a 60-
vote point of order against any legislation that includes a 
Federal income tax rate increase.
            Sec. 211. Circuit Breaker To Protect Social Security
      Section 211 of the Senate resolution would create a 60-
vote point of order, in any year in which CBO projects an on-
budget deficit for the budget year or any subsequent fiscal 
year, against a budget resolution for that year (and amendments 
thereto) which would fail to reduce on-budget deficits relative 
to CBO's projections and put the budget on a path to achieve 
on-budget balance within five years. There is an exception 
during times of war and low economic growth.
            Sec. 212. Point of Order--20% Limit on New Direct Spending 
                    in Reconciliation Legislation
      Section 212 of the Senate resolution would create a 60-
vote point of order against provisions of any reconciliation 
legislation (and provisions of any amendment thereto) that 
would increase outlays if the effect of all the provisions in 
any committee's jurisdiction would create gross new direct 
spending exceeding 20% of the total savings instruction to that 
committee.
            Sec. 213. Point of Order Against Legislation That Raises 
                    Income Tax Rates for Small Businesses, Family 
                    Farms, or Family Ranches
      Section 213 of the Senate resolution would create a 60-
vote point of order against legislation that includes a Federal 
income tax rate increase on incomes generated by small 
businesses, family farms, or family ranches.
            Sec. 214. Point of Order Against Provisions of 
                    Appropriations Legislation That Constitute Changes 
                    in Mandatory Programs With Net Costs
      Section 214 of the Senate resolution would create a 60-
vote point of order against provisions of appropriations 
legislation that would have been estimated as affecting direct 
spending or receipts were they included in legislation other 
than appropriations legislation, if such provision has a net 
cost over the total of the period of the current year, the 
budget year, and all fiscal years covered under the most 
recently-adopted concurrent resolution on the budget.
            Sec. 215. Disclosure of Interest Costs
      Section 215 of the Senate resolution is a 60-vote point 
of order against direct spending and revenue legislation that 
fails to include a CBO estimate of the cost of the debt 
servicing that would be caused by such legislation.
            Sec. 325. Application and Effect of Changes in Allocations 
                    and Aggregates
      Section 325 of the Senate resolution details the 
adjustment procedures required to accommodate legislation 
provided for in this resolution. This section provides that the 
adjustments shall apply while the legislation is under 
consideration and take effect upon enactment of the 
legislation. In addition, the section requires the adjustments 
to be printed in the Congressional Record.
      The section also notes that, for purposes of enforcement, 
aggregate and allocation levels resulting from adjustments made 
pursuant to this resolution will have the same effect as if 
adopted in the original levels of Title I of this resolution. 
This section also provides that the Committee on the Budget 
shall determine the budgetary levels and estimates which are 
required to enforce points of order under the Congressional 
Budget Act.
            Sec. 326. Adjustments To Reflect Changes in Concepts and 
                    Definitions
      Section 326 of the Senate resolution requires the 
chairman of the Committee on the Budget to adjust levels and 
allocations in this resolution upon enactment of legislation 
that changes concepts or definitions.
            Sec. 327. Exercise of Rulemaking Powers
      Section 327 of the Senate resolution provides that, once 
adopted, the provisions of the resolution are incorporated into 
the rules of the Senate and shall supersede inconsistent rules. 
The section recognizes the constitutional right of the Senate 
to change those rules at any time.
House Amendment
            Sec. 301. Program Integrity Initiatives
      Section 301 of the House amendment provides for specific 
allocation adjustments for the Committee on Appropriations when 
the Committee reports legislation that includes increased 
appropriations for the following four program integrity 
initiatives: (1) continuing disability reviews and Supplemental 
Security Income redeterminations for the Social Security 
Administration; (2) improved compliance with the provisions of 
the Internal Revenue Code; (3) the Health Care Fraud and Abuse 
Control program at the Department of Health and Human Services; 
and (4) unemployment insurance improper payment reviews.
      The adjustments under this section are intended to do no 
more than provide additional administrative funding for current 
program integrity activities to eliminate errors or fraud in 
the operation of a number of Federal programs and compliance 
with Federal tax laws. For example, the adjustment for 
unemployment compensation programs is provided to increase 
limited administrative funding for current program integrity 
activities, and not to finance other proposals that would 
adversely affect workers who have received unemployment 
benefits.
      The section outlines procedures for these allocation 
adjustments. In addition, the section directs committees of the 
House of Representatives to include recommendations for 
improved governmental performance in views and estimates 
submitted to the Committee on the Budget pursuant to section 
301(d) of the Congressional Budget Act.
            Sec. 302. Advance Appropriations
      Section 302 of the House amendment limits the amount and 
type of advance appropriations for 2009 and 2010. Under this 
section, advance appropriations for 2009 or 2010 are restricted 
to $25.6 billion for programs, projects, activities, or 
accounts identified in the joint explanatory statement of 
managers that will accompany this resolution. This total 
reflects an increase of $2.0 billion over the previous limit. 
The section defines advance appropriations as any new 
discretionary budget authority provided in a bill or joint 
resolution making general or continuing appropriations for 2008 
that first becomes available for any fiscal year after 2008.
            Sec. 303. Overseas Deployments and Emergency Needs
      Section 303 of the House amendment establishes a 
procedure whereby provisions or measures reported by the 
Committee on Appropriations will be exempt from the 
restrictions under titles III and IV of the Congressional 
Budget Act of 1974. The exemption will apply if: (1) the 
Committee determines and designates that amounts appropriated 
are necessary for overseas deployments and related activities; 
or, (2) the Committee provides nondefense discretionary 
appropriations and designates those amounts as necessary to 
meet emergency needs.
            Sec. 304. Application and Effect of Changes in Allocations 
                    and Aggregates
      Section 304 of the House amendment details the allocation 
and aggregate adjustment procedures that are required to 
accommodate legislation for the reserve funds and program 
integrity initiatives in this resolution. This section provides 
that the adjustments shall apply while the legislation is under 
consideration and take effect upon enactment of the 
legislation. In addition, the section requires the adjustments 
to be printed in the Congressional Record.
      The section also notes that, for purposes of enforcement, 
aggregate and allocation levels resulting from adjustments made 
pursuant to this resolution will have the same effect as if 
adopted in the original levels of Title I of this budget 
resolution. This section also provides that the Committee on 
the Budget shall determine the budgetary levels and estimates 
which are required to enforce points of order under the 
Congressional Budget Act.
            Sec. 305. Adjustments To Reflect Changes in Concepts and 
                    Definitions
      Section 305 of the House amendment requires the chairman 
of the Committee on the Budget to adjust levels and allocations 
in this budget resolution upon enactment of legislation that 
changes concepts or definitions.
            Sec. 306. Compliance With Section 13301 of the Budgetary 
                    Enforcement Act of 1990
      Section 306 of the House amendment provides that 
administrative expenses of the Social Security Administration 
shall be part of the annual appropriations process by including 
those expenses in the Committee on Appropriations' allocation 
pursuant to Section 302 of the Congressional Budget Act.
            Sec. 307. Exercise of Rulemaking Powers
      Section 307 of the House amendment provides that, once 
adopted, the provisions of the budget resolution are 
incorporated into the rules of the House of Representatives and 
shall supersede inconsistent rules. The section recognizes the 
constitutional right of the House of Representatives to change 
those rules at any time.
Conference Agreement
      In January, the House of Representatives adopted the 
first-ever House of Representatives pay-as-you-go (paygo) 
rule--specifying that any legislative changes to mandatory 
spending or revenues would have to be done in a deficit-neutral 
way. Given the serious long-term fiscal challenges including a 
growing burden of national debt facing our nation, a rigorous 
enforcement of paygo is especially critical. The House has 
aggressively enforced the paygo requirement since its passage, 
and in this resolution the House and Senate reaffirm a 
commitment to a strict enforcement of the pay-as-you-go rules. 
The House's commitment to paygo is also reinforced by the tough 
trigger mechanism contained in Section 321 of the conference 
agreement and further described in Section 321 of this 
Statement of Managers.
      The following are the concrete steps the conference 
report takes to reinforce and extend this commitment to fiscal 
responsibility:
      First, Section 201 of the conference report toughens the 
Senate paygo rule, restoring it to the form that existed in the 
1990s. This session of Congress will mark the first time ever 
that both the House and the Senate will be governed by internal 
rules implementing the pay-as-you-go principle. To ensure that 
these rules are more effectively enforced, the Senate paygo 
rule included in this resolution matches the enforcement 
windows established in the House rule.
      Second, Section 508 of the conference report expresses 
Congress's commitment to an additional paygo enforcement 
mechanism: reinstating the statutory paygo rule that was in 
place in the 1990s and that is widely credited with helping 
bring the budget from then-record deficits in the early 1990s 
to the budget surpluses achieved by the end of that decade. 
Because the conference agreement is a concurrent resolution, 
separate legislation will be required to implement this policy, 
but the conference report gives this policy a strong and clear 
endorsement.
      Third, Section 203 of the conference report contains a 
Senate point of order that would be imposed against legislation 
that has a significant deficit impact in any of the four 
decades (2018-2057) following the ten-year period covered by 
the House and Senate paygo rules.
      Fourth, Section 321 of the conference report includes a 
House trigger mechanism to ensure that legislation is fiscally 
responsible or faces a second procedural hurdle in the House in 
addition to the paygo rule.
      In all, this conference report implements policies and 
rules consistent with fiscal responsibility and the pay-as-you-
go principle, ensuring that they apply to the actions of the 
entire Congress. The goal is to bring the budget back to 
balance, something that this conference report achieves in 
2012.
            Sec. 201. Pay-As-You-Go Point of Order in the Senate
      In Section 201 of the conference agreement, which applies 
only in the Senate, the Senate insists on, and the House 
recedes from its disagreement with, Section 201 of the Senate 
resolution, the paygo point of order in the Senate, with a 
technical amendment to enforce points of order over two time 
periods: (1) the period of the current fiscal year, the budget 
year, and the total of the ensuing four fiscal years following 
the budget year, and (2) the period of the current fiscal year, 
the budget year, and the total of the ensuing nine fiscal years 
following the budget year. These are the time periods for which 
paygo is enforced in the House.
      As in the past, the paygo rule embodied in Section 201 of 
the conference agreement requires that new mandatory spending 
and tax cuts be offset or get 60 votes to waive the point of 
order. Section 201 strengthens paygo enforcement by eliminating 
a loophole that previously exempted from the point of order all 
deficit increases assumed in any budget resolution. Under 
Section 201, paygo will be applied to all new mandatory 
spending and revenue legislation that would worsen the deficit 
in either of the two relevant time periods. It would extend 
this stronger paygo rule through 2017 and effectively repeal 
the current, weaker version of the paygo rule.
      Consistent with ending this loophole, the Senate 
resolution assumes that all existing balances on the 
Congressional pay-as-you-go ledger would be eliminated, and the 
scorecard reset to zero for all time periods.
      Section 201 of the conference agreement also clarifies 
language in the paygo rule which prohibits any net savings 
enacted in any bill pursuant to a reconciliation instruction 
from being made available on the paygo ledger. In 1993, the 
Senate originally created the paygo rule as a provision in the 
FY1994 budget resolution (H. Con. Res. 64), specifically for 
the purpose of preventing the deficit reduction expected to be 
achieved in a subsequent reconciliation bill from being used to 
offset the costs of any new mandatory spending or revenue 
legislation. Section 201 of the conference agreement restores 
this original intent, by clarifying that savings enacted in any 
reconciliation bill shall never be placed on the paygo ledger 
and used as offsets for another reconciliation bill (even if 
enacted pursuant to reconciliation instructions in the same 
budget resolution) or as offsets for any other legislation. For 
paygo purposes, all net savings enacted pursuant to 
reconciliation are to be dedicated solely to deficit reduction.
            Sec. 202. Senate Point of Order Against Reconciliation 
                    Legislation That Would Increase the Deficit or 
                    Reduce a Surplus
      The Senate insists on, and the House recedes from its 
disagreement with, Section 202 of the Senate resolution, with a 
technical amendment to enforce the point of order over two time 
periods: (1) the period of the current fiscal year, the budget 
year, and the total of the ensuing four fiscal years following 
the budget year, and (2) the period of the current fiscal year, 
the budget year, and the total of the ensuing nine fiscal years 
following the budget year. Section 202 creates a new point of 
order against reconciliation measures that would cause or 
increase an on-budget deficit or decrease an on-budget surplus. 
It can be waived with 60 votes.
            Sec. 203. Senate Point of Order Against Legislation 
                    Increasing Long-Term Deficits
      The Senate insists on, and the House recedes from its 
disagreement with, Section 203 of the Senate resolution. It 
establishes a point of order in the Senate against legislation 
that would cause a net deficit increase in excess of $5.0 
billion (including changes in revenues and mandatory spending, 
but excluding debt service) in any of the four ten-year periods 
2018-2027, 2028-2037, 2038-2047, or 2048-2057. The point of 
order can be waived with 60 votes. The provision sunsets at the 
end of fiscal year 2017, and effectively repeals the long-term 
spending point of order in Section 407 of H. Con. Res. 95, the 
fiscal year 2006 budget resolution conference report.
            Sec. 204. Emergency Legislation
      In subsection (a) of Section 204 of the conference 
agreement, which applies only in the Senate, the Senate insists 
on Section 204 of the Senate resolution with an amendment. 
Under Section 204(a), emergency designations will be subject to 
an emergency designation point of order in the Senate, which 
can be waived with 60 votes. The amendment deleted an exception 
adopted to the Senate resolution in Amendment 534 offered by 
Senator DeMint.
      In subsection (b) of Section 204 of the conference 
agreement, which applies only in the House, the House recedes 
from its position in Section 303 of the House amendment and 
concurs with a further amendment, and the Senate agrees to the 
same. In the House, discretionary appropriations that are 
designated as emergencies shall not count for the purposes of 
Titles III and IV of the Congressional Budget Act of 1974. In 
the House, any provisions designated as emergencies under rules 
in effect for 2007 will be accommodated under Section 204 in 
this resolution.
            Sec. 205. Extension of Enforcement of Budgetary Points of 
                    Order in the Senate
      In Section 205 of the conference agreement, which applies 
only in the Senate, the Senate insists on Section 205 of the 
Senate resolution with an amendment, and the House agrees to 
the same. Section 205 extends 60-vote enforcement of budgetary 
points of order in the Senate, other than those pursuant to 
Sections 425 and 303 of the Budget Act, through 2017.
            Sec. 206. Point of Order Against Advance Appropriations
      In subsection (a) of Section 206 of the conference 
agreement, which applies only in the Senate, the Senate insists 
on, and the House recedes from its disagreement with, Section 
206 of the Senate resolution. It provides a supermajority point 
of order in the Senate against appropriations in fiscal year 
2008 bills that would first become effective in any year after 
fiscal year 2008, and against appropriations in fiscal year 
2009 bills that would first become effective in any year after 
fiscal year 2009. It does not apply against appropriations for 
the Corporation for Public Broadcasting, nor does it apply 
against changes in mandatory programs or deferrals of mandatory 
budget authority from one year to the next. There is an 
exemption for each of fiscal years 2008 and 2009 of up to $25.2 
billion for the following:

      Accounts identified for Advance Appropriations in the Senate

Labor, HHS:
      Employment and Training Administration
      Education for the Disadvantaged
      School Improvement
      Children and Family Services (Head Start)
      Special Education
      Vocational and Adult Education
Financial Services and General Government: Payment to Postal 
Service Transportation, Housing and Urban Development: Section 
8 Renewals

      In subsection (b) of Section 206 of the conference 
agreement, which applies only in the House, the House insists 
on Section 302 of the House amendment. It defines advance 
appropriations, and restricts advance appropriations for fiscal 
years 2009 or 2010 to a total of $25.6 billion for the 
following accounts:

      Accounts Identified for Advance Appropriations in the House

Advance Appropriations for Fiscal Year 2009
      Employment and Training Administration
      Education for the Disadvantaged
      School Improvement
      Children and Family Services (Head Start)
      Special Education
      Vocational and Adult Education
      Payment to Postal Service
      Section 8 Renewals
Advance Appropriations for Fiscal Year 2010
      Corporation for Public Broadcasting
            Sec. 207. Discretionary Spending Limits, Program Integrity 
                    Initiatives, and Other Adjustments
      In subsection (a), (b), and ( c) of Section 207 of the 
conference agreement, which apply only in the Senate, the 
Senate insists on Section 207 of the Senate resolution with an 
amendment in the nature of a substitute. Currently, there are 
no discretionary spending limits for any fiscal year. Section 
207 will strengthen fiscal responsibility by establishing 
discretionary spending limits in the Senate for fiscal years 
2007 and 2008, and enforce them with a Senate point of order 
that can only be waived with 60 votes. It permits adjustments 
to the discretionary spending limits in the Senate for fiscal 
year 2008 for program integrity initiatives, including Social 
Security Administration continuing disability reviews and 
Supplemental Security Income redeterminations, enhanced 
Internal Revenue Service tax enforcement to address the tax 
gap, appropriations for Health Care Fraud and Abuse Control 
(HCFAC) program at the Department of Health and Human Services, 
and in-person reemployment and eligibility assessments and 
unemployment insurance improper payment reviews.
      In subsection (d) of Section 207 of the conference 
agreement, which applies only in the House, the House insists 
on Section 301 of the House amendment with an amendment. The 
House amendment provides for several program integrity 
adjustments for 2008 in the same areas as in the Senate 
resolution, including for Social Security Administration 
continuing disability reviews and Supplemental Security Income 
redeterminations, enhanced Internal Revenue Service tax 
enforcement to address the tax gap, appropriations for the 
Health Care Fraud and Abuse Control (HCFAC) program at the 
Department of Health and Human Services, and in-person 
reemployment and eligibility assessments and unemployment 
insurance improper payment reviews.
      The conference agreement allows for adjustments to be 
made to the discretionary spending limits in the Senate, 
aggregates, and 302(a) allocations of the House and Senate 
Appropriations Committees up to the total budget authority 
shown in Section 103 (21) for overseas deployments and related 
activities (and the new outlays flowing therefrom). In the 
Senate, if additional funding is required beyond the level 
specified in Section 103 (21), such funding would be provided 
pursuant to Section 204. In the House, if additional 
appropriations are required beyond this level, and such 
additional amounts are specifically designated as necessary for 
overseas deployments and related activities, then new budget 
authority, outlays or receipts resulting therefrom shall not 
count for the purposes of titles III and IV of the 
Congressional Budget Act of 1974.
      Subsection (e) of Section 207 of the conference 
agreement, which applies in the House and Senate, directs all 
House and Senate Committees to include recommendations for 
improved governmental performance in the views and estimates 
that they submit to the respective Committees on the Budget 
under section 301(d) of the Congressional Budget Act.
      Subsection (f) of Section 207 of the conference 
agreement, which applies in both the House and Senate, allows 
adjustments to the levels and limits in this resolution to 
reflect differences between the levels assumed in this 
resolution and the levels that may ultimately be enacted in 
2007 supplemental appropriations legislation currently under 
consideration in Congress. Similar language was included in the 
conference report on the fiscal year 2004 budget resolution (H. 
Con. Res. 95, 108th Congress) regarding 2003 supplemental 
appropriations.
            Sec. 208. Inapplicability of Previous Allocations in the 
                    Senate
      In Section 208 of the conference agreement, which applies 
only in the Senate, the Senate insists on, and the House 
recedes from its disagreement with, Section 208 of the Senate 
resolution. Because this concurrent resolution on the budget 
for fiscal year 2008 establishes new discretionary spending 
limits for fiscal years 2007 and 2008 and new committee 
spending allocations pursuant to section 302(a) of the 
Congressional Budget Act of 1974, Section 208 of the Senate 
resolution clarifies that the ``deeming'' provisions of last 
year's emergency supplemental in Section 7035 of Public Law 
109-234 shall no longer apply in the Senate.
            Sec. 209. Senate Point of Order Against Provisions of 
                    Appropriations Legislation That Constitute Changes 
                    in Mandatory Programs With Net Costs
      In Section 209 of the conference agreement, which applies 
only in the Senate, the Senate insists on Section 214 of the 
Senate resolution with a substitute, and the House agrees to 
the same. Section 209 would create a 60-vote point of order 
against provisions of appropriations legislation constituting 
Changes in Mandatory Programs (ChIMPs) that would have been 
estimated as affecting direct spending or receipts were they 
included in legislation other than appropriations legislation, 
if all three of the following conditions are met:
      (1) the provision would increase BA in--
      (a) at least one of the nine fiscal years that follow the 
budget year, and
      (b) over the period of the total of the budget year and 
the nine fiscal years following the budget year;
      (2) the provision would increase net outlays over the 
period of the total of the nine fiscal years following the 
budget year; and
      (3) the sum total of all changes in mandatory programs in 
the legislation would increase net outlays as measured over the 
period of the total of the nine fiscal years following the 
budget year.
      The point of order does not apply against legislation 
making supplemental appropriations for fiscal year 2007. Nor 
does it apply against any ChIMPs that were enacted in each of 
the three fiscal years prior to the budget year (including 
those done as a result of the year-long funding resolution 
enacted for 2007). The point of order works like the Byrd rule 
in that it applies against individual provisions of legislation 
rather than against an entire bill, amendment, or conference 
report. If the point of order is not waived then the offending 
provision is stricken.
            Sec. 210. Compliance With Section 13301 of the Budget 
                    Enforcement Act of 1990
      In Section 210 of the conference agreement, the House 
recedes from its position in Section 306 of the House amendment 
and concurs with a further amendment, and the Senate agrees to 
the same. Subsection (a) of Section 210 applies in both the 
House and Senate. Subsection (b) of Section 210 applies only in 
the House.
            Sec. 211. Application and Effect of Changes in Allocations 
                    and Aggregates
      In Section 211 of the conference agreement, the House 
insists on, and the Senate recedes from its disagreement with, 
Section 304 of the House amendment.
            Sec. 212. Adjustments to Reflect Changes in Concepts and 
                    Definitions
      In Section 212 of the conference agreement, the House 
insists on, and the Senate recedes from its disagreement with, 
Section 305 of the House amendment.
            Sec. 213. Exercise of Rulemaking Powers
      In Section 213 of the conference agreement, the House 
recedes from its position in Section 307 of the House amendment 
and concurs with a further amendment, and the Senate agrees to 
the same.

                             Reserve Funds

Senate Resolution
            Sec. 301. Deficit-Neutral Reserve Fund for SCHIP 
                    Legislation
      Section 301 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
by up to $20.0 billion for SCHIP reauthorization legislation of 
up to $50.0 billion, so long as the legislation is deficit-
neutral over the total of 2007-2012.
            Sec. 302. Deficit-Neutral Reserve Fund for Care of Wounded 
                    Service Members
      Section 302 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that improves the medical care of or disability 
benefits for wounded or disabled military personnel or veterans 
(including the elimination of the offset between Survivor 
Benefit Plan annuities and veterans' dependency and indemnity 
compensation), including improvements to the physical 
disability evaluation system of the Department of Defense to 
expedite the claims process, provided the legislation is 
deficit-neutral over the total of 2007-2012.
            Sec. 303. Deficit-Neutral Reserve Fund for Tax Relief
      Section 303 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for one or more pieces of tax relief legislation, including 
refundable tax relief and extensions of expiring tax relief, 
such as enhanced charitable giving from IRAs and the 
reauthorization of the new markets tax credit under section 45D 
of the Internal Revenue Code of 1986 for an additional five 
years, provided the legislation is deficit-neutral over the 
total of 2007-2012.
            Sec. 304. Deficit-Neutral Reserve Fund for Comparative 
                    Effectiveness Research
      Section 304 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to establish a new Federal or public-private 
initiative for comparative effectiveness research, provided the 
legislation is deficit-neutral over the total of 2007-2012.
            Sec. 305. Deficit-Neutral Reserve Fund for Higher Education
      Section 305 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation--including tax legislation--that would make 
higher education more accessible and affordable, provided the 
legislation is deficit-neutral over the total of 2007-2012.
            Sec. 306. Deficit-Neutral Reserve Fund for the Farm Bill
      Section 306 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
by up to $15.0 billion for legislation which is deficit-neutral 
over the total of 2007-2012 that would do one or more of the 
following: reauthorize the Food Security and Rural Investment 
Act of 2002; strengthen agriculture and rural economies and 
critical nutrition programs; provide agriculture-related tax 
relief and rural development investment incentives for counties 
impacted by high rates of out-migration; or improve the 
environment by reducing dependence on foreign sources of energy 
through expanded production and use of alternative fuels. This 
section anticipates that the Farm Bill will ultimately be 
comprised of titles from more than one committee, and would 
therefore allow the Chairman to revise multiple committee 
allocations, and revenue and spending aggregates, to 
accommodate the legislation.
            Sec. 307. Deficit-Neutral Reserve Fund for Energy 
                    Legislation
      Section 307 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for one or more pieces of legislation--including tax 
legislation--that would reduce our nation's dependence on 
foreign sources of energy, expand production and use of 
alternative fuels and alternative fuel vehicles, promote 
renewable energy development, improve electricity transmission, 
encourage responsible development of domestic oil and natural 
gas resources, or reward conservation and efficiency; provided 
the legislation is deficit-neutral over the total of 2007-2012.
            Sec. 308. Deficit-Neutral Reserve Fund for Medicare
      Section 308 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for:
      Prescription drug price negotiation legislation under 
Medicare Part D, to repeal the non-interference clause in 
Section 1860D-11(i)(1) of the Social Security Act, while 
preserving access to prescription drugs and price competition 
without requiring a particular formulary or instituting a price 
structure for reimbursement of covered Part D drugs, provided 
that the legislation is deficit-neutral over 2007-2012 and that 
all savings from the measure must be used either to improve the 
Part D benefit or to reduce the deficit;
      Legislation to increase the reimbursement rate for 
physician services under Medicare Part B and that includes 
financial incentives for physicians to improve the quality and 
efficiency of items and services furnished to Medicare 
beneficiaries through the use of consensus-based quality 
measures, provided that it is deficit-neutral over 2007-2012; 
and
      Legislation making improvements of up to $5.0 billion to 
the prescription drug benefit under Medicare Part D, so long as 
the legislation is deficit-neutral over 2007-2012.
            Sec. 309. Deficit-Neutral Reserve Fund for Small Business 
                    Health Insurance
      Section 309 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that makes health insurance coverage more 
affordable or available to small businesses and their 
employees, without weakening rating rules or reducing covered 
benefits, provided the legislation is deficit-neutral over the 
total of 2007-2012.
            Sec. 310. Deficit-Neutral Reserve Fund for County Payments
      Section 310 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
by up to $440 million in 2008 and up to $2.2 billion over the 
total of 2008-2012 for county payments legislation that 
reauthorizes the Secure Rural Schools and Community Self-
Determination Act of 2000, provided the legislation is deficit-
neutral over the total of 2007-2012. The expiration of this law 
would have a significant impact on rural communities.
            Sec. 311. Deficit-Neutral Reserve Fund for Terrorism Risk 
                    Insurance Reauthorization
      Section 311 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that provides for a continuing federal role in 
ensuring that terrorism risk insurance remains available after 
the expiration of the Terrorism Risk Insurance Extension Act, 
provided the legislation is deficit-neutral over the total of 
2007-2012.
            Sec. 312. Deficit-Neutral Reserve Fund for Affordable 
                    Housing
      Section 312 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that would establish an affordable housing fund 
financed by the housing government-sponsored enterprises, 
provided the legislation is deficit-neutral over the total of 
2007-2012.
            Sec. 313. Deficit-Neutral Reserve Fund for Receipts From 
                    Bonneville Power Administration
      Section 313 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that prohibits the Bonneville Power 
Administration from making early payments on its federal bond 
debt, provided the legislation is deficit-neutral over the 
total of 2007-2012. The proposal in the President's budget 
would have a detrimental impact on electricity rates in the 
Northwest.
            Sec. 314. Deficit-Neutral Reserve Fund for Indian Claims 
                    Settlement
      Section 314 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to provide a statutory settlement for Indian 
trust fund litigation involving the accounting and management 
of individual Indian trust monies and assets, including the 
Cobell v. Kempthorne litigation, as well as provisions to 
offset the cost of the settlement, provided that the 
legislation is deficit-neutral over the total of 2007-2012.
            Sec. 315. Deficit-Neutral Reserve Fund for Food and Drug 
                    Administration
      Section 315 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for certain legislation affecting the regulatory authority of 
the Food and Drug Administration (FDA) and authorizing the 
assessment of user fees, provided that the legislation is 
deficit-neutral over the total of 2007-2012.
            Sec. 316. Deficit-Neutral Reserve Fund for Health Care 
                    Reform
      Section 316 of the Senate resolution provides that if an 
SCHIP bill is enacted, the Chairman of the Budget Committee may 
revise the levels in the resolution for legislation to improve 
health care, provide quality health insurance for the uninsured 
and underinsured, and protect individuals with current health 
coverage, provided the legislation is deficit-neutral over the 
total of 2007-2012.
            Sec. 317. Deficit-Neutral Reserve Fund for Enhancement of 
                    Veterans' Benefits
      Section 317 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to enhance benefits for veterans, including GI 
educational benefits and services for low-vision and blinded 
veterans, provided the legislation is deficit-neutral over the 
total of 2007-2012.
            Sec. 318. Deficit-Neutral Reserve Fund for Long-Term Care
      Section 318 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to improve long-term care, provided the 
legislation is deficit-neutral over the total of 2007-2012.
            Sec. 319. Deficit-Neutral Reserve Fund for Health 
                    Information Technology
      Section 319 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation providing incentives or other support for 
adoption of modern information technology to improve quality 
and protect privacy in health care, and for legislation 
providing for payments based on adherence to accepted clinical 
protocols identified as best practices, provided the 
legislation is deficit-neutral over the total of 2007-2012.
            Sec. 320. Deficit-Neutral Reserve Fund for Child Care
      Section. 320 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to provide up to $5.0 billion to States for 
child care, provided the legislation is deficit-neutral over 
the total of 2007-2012.
            Sec. 321. Deficit-Neutral Reserve Fund for Comprehensive 
                    Immigration Reform
      Section 321 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for comprehensive immigration reform legislation, provided the 
legislation is deficit-neutral in 2008 and over the total of 
2008-2012.
            Sec. 322. Deficit-Neutral Reserve Fund for Mental Health 
                    Parity
      Section 322 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that provides parity between health insurance 
coverage of mental health benefits and benefits for medical and 
surgical services, provided the legislation is deficit-neutral 
in 2008 and over the total of 2008-2012.
            Sec. 323. Deficit-Neutral Reserve Fund for Preschool 
                    Opportunities
      Section 323 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to provide assistance to States for offering or 
expanding preschool to children of low-income families, 
provided the legislation is deficit-neutral over the total of 
2007-2012.
            Sec. 324. Deficit-neutral Reserve Fund for the Safe 
                    Importation of FDA-Approved Prescription Drugs
      Section 324 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to permit the safe importation of prescription 
drugs approved by the FDA from a specified list of countries, 
provided the legislation is deficit-neutral over the total of 
2007-2012.
            Sec. 328. Deficit-Neutral Reserve Fund for Expansion of 
                    Above-the-Line Deduction for Teacher Classroom 
                    Supplies
      Section 328 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to permanently extend and increase to $400 the 
above-the-line deduction for teacher classroom supplies and 
expand the deduction to include qualified professional 
development expenses, provided the legislation is deficit-
neutral over the total of 2007-2012.
            Sec. 329. Adjustment for Smithsonian Institution Salaries 
                    and Expenses
      Section 329 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation appropriating up to $17 million for 2008 if the 
Comptroller General makes certain certifications to Congress 
regarding the Smithsonian Institution.
            Sec. 330. Deficit-Reduction Reserve Fund for Reduction of 
                    Improper Payments
      Section 330 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that achieves savings by eliminating or 
reducing improper payments by agencies and uses such savings to 
reduce the deficit, provided the legislation would not increase 
the deficit over the total of 2007-2012.
            Sec. 331. Deficit-Neutral Reserve Fund for Extension of the 
                    Deduction for State and Local Sales Taxes
      Section 331 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that would extend the deduction for State and 
local sales taxes, provided the legislation would not increase 
the deficit over the total of 2007-2012.
            Sec. 332. Deficit-Neutral Reserve Fund for Extension of 
                    Certain Energy Tax Incentives
      Section 332 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that would extend energy tax incentives through 
2015, provided the legislation would not increase the deficit 
over the total of 2007-2012.
            Sec. 333. Reserve Fund To Provide Additional Training for 
                    Physicians and Attract More Physicians in States 
                    That Face a Shortage of Physicians in Training
      Section 333 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that would provide additional training for 
physicians and attract more physicians in States with a 
shortage of physicians in training, provided the legislation 
would not increase the deficit over the total of 2007-2012.
            Sec. 334. Deficit-Neutral Reserve Fund for Repeal of the 
                    1993 Increase in the Income Tax on Social Security 
                    Benefits
      Section 334 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that would repeal the 1993 increase in the 
income tax on Social Security benefits, provided the 
legislation would not increase the deficit over the total of 
2007-2012.
            Sec. 336. Deficit-Neutral Reserve Fund for Eliminating 
                    Military Retirement and Disability Offset
      Section 336 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that would expand eligibility for Combat-
Related Special Compensation to permit additional disabled 
retirees to receive both disability compensation and retired 
pay, provided the legislation would not increase the deficit 
over the total of 2007-2012.
            Sec. 337. Deficit-Neutral Reserve for Asbestos Reform 
                    Legislation
      Section 337 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for asbestos reform legislation, provided the legislation would 
not increase the deficit over the total of 2007-2057.
            Sec. 338. Deficit-Neutral Reserve Fund for Manufacturing 
                    Initiatives
      Section 338 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation, including tax legislation, that would 
revitalize the United States manufacturing sector, provided the 
legislation would not increase the deficit over the total of 
2007-2012.
            Sec. 339. Deficit-Reduction Reserve Fund for Increased Use 
                    of Recovery Audits
      Section 339 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that achieves savings by requiring that 
agencies increase their use of recovery audits and use such 
savings to reduce the deficit, provided the legislation would 
not increase the deficit over the total of 2007-2012.
            Sec. 340. Deficit-Neutral Reserve Fund for a Delay in the 
                    Implementation of a Proposed Rule Relating to the 
                    Federal-State Financial Partnerships Under Medicaid 
                    and SCHIP
      Section 340 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation that provides for a delay in the implementation 
of a proposed rule relating to the Federal-State financial 
partnerships under Medicaid and SCHIP, provided the legislation 
would not increase the deficit over the total of 2007-2012.
            Sec. 341. Reserve Fund To Improve the Health Care System
      If the Finance Committee is within its 302(a) allocation, 
Section 341 of the Senate resolution allows the Chairman of the 
Budget Committee to revise the levels in the resolution for 
legislation reported by the Finance Committee that creates a 
framework for using Medicare data to evaluate health care, if 
it protects privacy and prevents disclosure of proprietary or 
trade secret information, provided the legislation would not 
increase the deficit in 2008 or over the total of 2008-2012.
            Sec. 342. Reserve Fund to Improve Medicare Hospital Payment 
                    Accuracy
      If the Finance Committee is within its 302(a) allocation, 
Section 342 of the Senate resolution allows the Chairman of the 
Budget Committee to revise the levels in the resolution for 
legislation reported by the Finance Committee to improve 
Medicare hospital payment accuracy, provided the legislation 
would not increase the deficit over the total of 2008-2012.
            Sec. 343. Deficit-Neutral Reserve Fund to Improve Health 
                    Insurance
      Section 343 of the Senate resolution allows the Chairman 
of the Budget Committee to revise the levels in the resolution 
for legislation to improve health insurance, provided the 
legislation would not increase the deficit over the total of 
2007-2012.
House Amendment
            Sec. 201. Reserve Fund for the State Children's Health 
                    Insurance Program
      The reserve fund accommodates the Committee on Energy and 
Commerce reporting legislation of up to $50.0 billion in 
additional outlays to improve children's health through 
reauthorization of the State Children's Health Program (SCHIP) 
as long as the authorizing legislation placed before the House 
complies with the pay-as-you-go principle. These additional 
resources will sustain current caseloads, expand coverage, and 
reduce the number of uninsured children. Of the over nine 
million uninsured children in this nation, around six million 
are eligible for SCHIP or Medicaid but do not receive coverage.
            Sec. 202. Reserve Fund for Reform of the Alternative 
                    Minimum Tax
      The reserve fund for Alternative Minimum Tax (AMT) relief 
accommodates legislation that reforms the tax code to shield 
middle-income families from the AMT as long as it adheres to 
the pay-as-you-go principle. Without reform, the number of 
taxpayers subject to the AMT will rise from 4.2 million in 2006 
to 23.2 million in 2007 and to 25.7 million in 2008, according 
to the Joint Committee on Taxation.
            Sec. 203. Reserve Fund to Provide for Middle-Income Tax 
                    Relief and Economic Equity
      The reserve fund for middle-income tax relief supports 
legislation to reduce tax burdens on middle-income families and 
taxpayers that complies with the pay-as-you-go principle. This 
includes legislation such as the extension of the 10 percent 
individual income tax rate, marriage penalty relief, the child 
tax credit, the research and experimentation tax credit, the 
deduction for small business expensing, and the deduction for 
State and local sales taxes. It also accommodates elimination 
of estate taxes on all but a minute fraction of estates, and a 
tax credit for school construction.
            Sec. 204. Reserve Fund for Agriculture
      The reserve fund accommodates legislation that 
reauthorizes the Farm Security and Rural Investment Act of 2002 
(Public Law 107-171) or prior farm support acts, or authorizes 
similar programs, or both, to the extent that such legislation 
complies with the pay-as-you-go principle. The section also 
provides for an increase in budget authority up to $20.0 
billion over six years (2007-2012) above the Congressional 
Budget Office's current estimate of spending for these programs 
if the funding increases are appropriately offset. The 
resolution allows for the House to continue to address a number 
of priorities, such as maintaining a strong farm safety net for 
our nation's agricultural producers; delivering natural 
resource conservation measures on private lands; investing in 
energy research; and rural development projects that strengthen 
our rural economies; and enhancing food nutrition assistance to 
help fight hunger. The reserve fund could also facilitate a new 
Farm Bill that provides enhanced conservation, research, and 
marketing assistance to crops that have not received 
traditional commodity support.
            Sec. 205. Reserve Fund for Higher Education
      The reserve fund accommodates reforms to the student loan 
programs that increase benefits to students, consistent with 
the pay-as-you-go principle adopted by the House. The Higher 
Education Act is scheduled to be reauthorized this year, and 
this reserve fund will provide committees maximum flexibility 
in finding offsets to make college more affordable for 
students.
            Sec. 206. Reserve Fund for Improvements in Medicare
      The reserve fund accommodates additional mandatory 
spending for Medicare program improvements such as increasing 
the Medicare reimbursement rate for physicians while holding 
beneficiaries harmless from associated premium increases, as 
long as the legislation is consistent with the House pay-as-
you-go principle. Current law calls for Medicare payment rates 
to physicians to be cut by nearly 40 percent over the next 
eight years. The House supports Federal investments in health 
information technology that will improve the quality and 
efficiency of not only Medicare, but also the health sector as 
a whole. Another possible area for program improvement is the 
Part D prescription drug benefit.
            Sec. 207. Reserve Fund for Creating Long-Term Energy 
                    Alternatives
      The reserve fund accommodates legislation consistent with 
H.R. 6 that invests in renewable or alternative energy 
resources, promotes new emerging energy technologies, or 
develops greater energy efficiency, to the extent that such 
legislation complies with the pay-as-you-go principle.
            Sec. 208. Reserve Fund for Affordable Housing
      The reserve fund accommodates legislation that creates an 
affordable housing fund, offset by savings from reforming the 
regulation of certain government-sponsored entities, such as 
Fannie Mae and Freddie Mac, to the extent that such legislation 
complies with the pay-as-you-go principle.
            Sec. 209. Reserve Fund for Equitable Benefits for Filipino 
                    Veterans of World War II
      The reserve fund accommodates additional mandatory 
spending to provide equitable benefits for all Filipino 
veterans of World War II and their survivors and dependents, 
consistent with the pay-as-you-go principle. Most Filipino 
veterans who fought alongside American troops, and their 
families, are currently not eligible for equitable federal 
benefits.
            Sec. 210. Reserve Fund for Secure Rural Schools and 
                    Community Self-Determination Act Reauthorization
      The reserve fund accommodates any legislation that 
reauthorizes the Secure Rural Schools and Community Self-
Determination Act (Public Law 106-393), to the extent that such 
legislation complies with the pay-as-you-go principle. That law 
provides economic assistance for roads and schools in rural 
communities affected by the loss of receipts from sales on 
federal lands in their communities. The assistance is intended 
to compensate local governments for the tax-exempt status of 
the national forests and other federal lands.
            Sec. 211. Reserve Fund for Receipts from the Bonneville 
                    Power Administration
      The resolution includes a reserve fund to accommodate 
legislation to reject the Administration's acceleration of 
Bonneville Power Administration's (BPA) debt repayment and to 
prohibit BPA from applying secondary sales revenue in excess of 
$500 million towards additional federal debt repayment, to the 
extent that such legislation complies with the pay-as-you-go 
principle.
            Sec. 212. Reserve Fund for Transitional Medical Assistance
      The reserve fund accommodates extension of Transitional 
Medical Assistance (TMA) through 2008, as long as it complies 
with the pay-as-you-go principle. TMA provides temporary 
Medicaid assistance for families transitioning to the 
workforce.
Conference Agreement
            Sec. 301. Deficit-Neutral Reserve Fund for SCHIP 
                    Legislation
      The House recedes to the Senate with a substitute. 
Subsection (a) retains the language of Section 301 of the 
Senate resolution with an amendment. This subsection applies 
only in the Senate. Subsection (b) retains the language of 
Section 201 of the House amendment with an amendment. This 
subsection applies only in the House.
            Sec. 302. Deficit-Neutral Reserve Fund for Veterans and 
                    Wounded Servicemembers
      The House recedes to the Senate with an amendment which 
incorporates Sections 302, 317, and 336 of the Senate 
resolution as well as Section 209 of the House amendment. The 
combined reserve fund would accommodate legislation consistent 
with the pay-as-you-go principle that improves services and 
benefits to wounded or disabled military personnel and 
retirees, veterans, and their survivors and dependents, which 
may include enhancing medical care and disability benefits, 
expanding eligibility to receive both disability compensation 
and retired pay (for combat-disabled retirees), eliminating the 
offset between survivor benefit annuities and dependency and 
indemnity compensation, improving disability evaluations, 
enhancing educational benefits, or increasing benefits to 
Filipino veterans of World War II and their survivors and 
dependents.
            Sec. 303. Deficit-Neutral Reserve Fund for Tax Relief
      In subsection (a) of Section 303 of the conference 
agreement, which applies only in the Senate, the Senate insists 
on Section 303 of the Senate resolution with an amendment. In 
subsection (b) of Section 303 of the conference agreement, 
which applies only in the House, the House insists on Sections 
202 and 203 of the House amendment with an amendment.
            Sec. 304. Deficit-Neutral Reserve Fund for Medicare 
                    Improvements
      The House recedes to the Senate with a substitute. 
Subsection (a) retains the language of Section 206 of the House 
amendment. This subsection applies only in the House of 
Representatives. Subsection (b) retains the language of Section 
308 and Section 342 of the Senate resolution. This subsection 
applies only in the Senate. Subsection (c) retains the language 
of Section 333 of the Senate resolution with an amendment. This 
subsection applies in the Senate and in the House of 
Representatives.
            Sec. 305. Deficit-Neutral Reserve Fund for Health Care 
                    Quality, Effectiveness, Efficiency, and 
                    Transparency
      The House recedes to the Senate with an amendment. 
Subsection (a) retains the language of Section 319 of the 
Senate resolution with an amendment. This subsection applies in 
the Senate and in the House of Representatives. Subsection (b) 
retains the language of Section 304 of the Senate resolution. 
This subsection applies in the Senate and in the House of 
Representatives. Subsection (c) retains the language in Section 
341 of the Senate resolution. This subsection applies in the 
Senate only.
            Sec. 306. Deficit-Neutral Reserve Fund for Higher Education
      The House recedes to the Senate with a substitute. The 
reserve funds for higher education in the House and Senate have 
identical goals and the identical effect of accommodating 
deficit-neutral legislation to make higher education more 
accessible and more affordable. The conference agreement could 
facilitate legislation that would enhance benefits for post-
secondary students, including, but not limited to, reductions 
in interest rates on student loans, significant increases in 
grant aid for students, or tax benefits.
            Sec. 307. Deficit-Neutral Reserve Fund for the Farm Bill
      The Senate recedes to the House with a substitute. 
Section 307 provides for an increase in budget authority of up 
to $20.0 billion over six years (2007-2012) if the funding 
increases are appropriately offset. Subsection (a) retains the 
language of Section 306 in the Senate resolution with an 
amendment. This subsection applies only in the Senate. 
Subsection (b) retains the language of Section 204 in the House 
resolution. This subsection applies only in the House.
            Sec. 308. Deficit-Neutral Reserve Fund for Energy 
                    Legislation
      The House recedes to the Senate with a substitute. 
Section 308 of the conference agreement is a deficit-neutral 
energy reserve fund with two parts. Subsection (a) combines 
language similar to the reserve funds included in Section 307 
and Section 332 of the Senate resolution and would apply only 
to the Senate. This subsection allows the Senate's 
discretionary spending limits to be adjusted in addition to the 
aggregates and allocations. Subsection (b) is similar to 
Section 207 of the House amendment and would apply only to the 
House.
            Sec. 309. Deficit-Neutral Reserve Fund for County Payments 
                    Legislation
      The Senate recedes to the House with an amendment. The 
amendment clarifies that the reserve fund could accommodate 
legislation that provides for the reauthorization of the Secure 
Rural Schools and Community Self-Determination Act of 2000 
(Public Law 106-393), or makes changes to the Payments in Lieu 
of Taxes Act of 1976 (Public Law 94-565), or both. The reserve 
fund would accommodate deficit-neutral legislation in the House 
and the Senate, and allows the Senate's discretionary spending 
limits to be adjusted in addition to the aggregates and 
allocations.
            Sec. 310. Deficit-Neutral Reserve Fund for Terrorism Risk 
                    Insurance Reauthorization
      The House recedes to Section 311 of the Senate resolution 
with a technical amendment to accommodate legislation in the 
House and Senate consistent with House and Senate pay-as-you-go 
rules. The reserve fund accommodates legislation in both bodies 
for a continuing federal role in ensuring that terrorism risk 
insurance remains available after the expiration of the 
Terrorism Risk Insurance Act.
            Sec. 311. Deficit-Neutral Reserve Fund for Affordable 
                    Housing
      The House recedes to Section 312 of the Senate resolution 
with a technical amendment to accommodate legislation in the 
House and Senate consistent with House and Senate pay-as-you-go 
rules. The reserve fund accommodates legislation in both bodies 
to establish an affordable housing fund financed by housing 
government-sponsored enterprises.
            Sec. 312. Deficit-Neutral Reserve Fund for Receipts from 
                    Bonneville Power Administration
      The House recedes to Section 313 of the Senate resolution 
with a substitute. The reserve fund included in Section 312 of 
the conference agreement is similar to the language included in 
both the House and Senate budget resolutions. The reserve fund 
would accommodate deficit-neutral legislation in the House and 
the Senate, and allows the Senate's discretionary spending 
limits to be adjusted in addition to the aggregates and 
allocations.
            Sec. 313. Deficit-Neutral Reserve Fund for Indian Claims 
                    Settlement
      The House recedes to Section 314 of the Senate resolution 
with an amendment to accommodate similar House legislation and, 
as in the Senate, provisions to ensure its cost is offset.
            Sec. 314. Deficit-Neutral Reserve Fund for Improvements in 
                    Health
      The House recedes to the Senate with an amendment which 
incorporates Sections 318 and 322 of the Senate resolution. The 
conference agreement consolidates Sections 309, 316, and 343 of 
the Senate resolution into two subsections, 314(a) and 314(b), 
with amendments. This reserve fund applies in the Senate and in 
the House of Representatives.
            Sec. 315. Deficit-Neutral Reserve Fund for Child Care
      The House recedes to Section 320 of the Senate resolution 
with an amendment to accommodate similar legislation in the 
House.
            Sec. 316. Deficit-Neutral Reserve Fund for Immigration 
                    Reform
      The House recedes to Section 321 of the Senate resolution 
with an amendment. This reserve fund applies only in the 
Senate.
            Sec. 317. Deficit-Reduction Reserve Fund
      The House recedes to the Senate with an amendment. The 
amendment combines reserve funds included in Section 330 and 
Section 339 of the Senate resolution. Section 317 applies to 
both the House and the Senate, and allows the Senate's 
discretionary spending limits to be adjusted in addition to the 
aggregates and allocations.
            Sec. 318. Deficit-Neutral Reserve Fund for Manufacturing 
                    Initiatives in the Senate
      The Senate insists on Section 338 of the Senate 
resolution, which applies only in the Senate, with an 
amendment.
            Sec. 319. Deficit-Neutral Reserve Fund for the Food and 
                    Drug Administration in the Senate
      Section 319 of the conference agreement consists of two 
subsections, 319(a) and 319(b). Subsection (a) allows the 
Chairman of the Senate Budget Committee to revise the levels in 
the resolution for legislation authorizing the Food and Drug 
Administration to regulate products and assess user fees on 
manufacturers and importers of these products to cover the cost 
of the Food and Drug Administration's regulatory activities. 
Subsection (b) retains the language of Section 324 of the 
Senate resolution. The reserve fund applies only to the Senate.
            Sec. 320. Deficit-Neutral Reserve Fund for Medicaid
      The House recedes to the Senate with a substitute. 
Subsection (a) retains the language of Section 340 of the 
Senate resolution with an amendment. Subsection (b) 
accommodates legislation for a demonstration project regarding 
Medicaid coverage of low-income HIV-infected individuals. 
Subsection (c) retains the language of Section 212 of the House 
amendment with an amendment. This reserve fund applies in the 
Senate and in the House of Representatives.
            Sec. 321. House Reserve Fund Adjustment for Revenue 
                    Measures
      Section 321 of the conference agreement creates a reserve 
fund to consider any revenue measure (including a conference 
report) in the House. It applies to bills that would reduce 
revenues below the sum of aggregate revenue levels for a five-
year period as measured against the Congressional Budget Office 
baseline for the most recent concurrent resolution of the 
budget. The revenue measure can only become effective upon 
certification by the Secretary of the Treasury and the Director 
of the Office of Management and Budget that the reduction in 
revenues due to the measure for the period comprising fiscal 
years through 2012 will not exceed the lesser of $179.8 billion 
or 80 percent of the fiscal year 2012 unified budget surplus, 
as estimated by them within six months prior to the first day 
of the first taxable year affected, said taxable year in no 
case earlier than 2010. If this provision is not included, the 
Chairman of the House Budget Committee will adjust aggregate 
revenue levels in the resolution to create a point of order in 
the House against the measure under Section 311 of the Budget 
Act. The Chairman would readjust the levels upon disposition of 
any measure considered in violation of this section. This point 
of order would be in addition to a House paygo point of order, 
which lies against any bill that is not deficit-neutral, 
notwithstanding any other provisions of this conference 
agreement.
      Any measure, including a conference report, decreasing 
total revenues, would have the point of order against it in the 
House, unless it contains a provision consistent with the 
following:
      ``None of the provisions of this Act or amendments made 
by it, shall have legal force or effect unless within six 
months prior to the first day of the first taxable year 
affected, said taxable year in no case earlier than 2010, the 
Secretary of the Treasury and the Director of the Office of 
Management and Budget project a unified budget surplus for the 
fiscal year 2012, estimate the budgetary impact of this Act, 
and certify by issuance of a joint communication, to be 
published in the Federal Register, that the estimated reduction 
in revenues for the period comprising fiscal years through 2012 
resulting from this Act (including amendments made by this Act) 
will not exceed the lesser of $179.8 billion or 80 percent of 
the projected fiscal year 2012 unified budget surplus.''
      Section 321 is a reserve fund that applies in the House 
only. It does not apply in the Senate. Its inclusion in this 
conference report, and the inclusion of the above language by 
the House of Representatives in this joint statement regarding 
the operation of this section in the House, is not to be 
construed as setting any procedural precedent in the Senate and 
does not reflect the Senate's agreement to any provisions in 
any conference agreement on revenue measures that are affected 
in the House by the requirements of this reserve fund.
            Sec. 322. Deficit-Neutral Reserve Fund for San Joaquin 
                    River Restoration and Navajo Nation Water Rights 
                    Settlements
      Section 322 is a deficit-neutral reserve fund for 
legislation that would fulfill the purposes of the San Joaquin 
River Restoration Settlement Act, implement a Navajo Nation 
water rights settlement as authorized by the Northwestern New 
Mexico Rural Water Projects Act, or both. The reserve fund 
would accommodate deficit-neutral legislation in both the House 
and the Senate.
            Sec. 323. Deficit-Neutral Reserve Fund for Selected Tax 
                    Relief Policies in the Senate
      The Senate insists on Sections 303, 328, and 331 of the 
Senate resolution with an amendment. This section applies only 
in the Senate.

                                 Policy

Senate Resolution
      Unlike Title IV of the House amendment, the Senate 
resolution did not contain a policy statement title.
House Amendment
      Title IV of the House amendment contains the following 
policy sections.
      Sec. 401. Policy on middle-income tax relief.
      Sec. 402. Policy on defense priorities.
      Sec. 403. Policy on college affordability.
Conference Agreement
            Sec. 401. Policy on Middle-Income Tax Relief
      The Senate recedes to Section 401 of the House amendment 
with a substitute. Subsection (a) retains the language of 
Section 401 of the House amendment, with amendments. This 
subsection applies only in the House. Subsection (b) applies 
only in the Senate.
            Sec. 402. Policy on Defense Priorities
      In Section 402 of the conference agreement, the Senate 
recedes to Section 402 of the House amendment with an 
amendment. The House Budget Committee report (H. Rept. 110-69) 
discussed key priorities to be funded within the defense 
allocation and the need for the Department of Defense to root 
out wasteful spending (such as the continued funding of some 
Cold War-era weapons systems, which may not be as effective in 
protecting the nation from today's threats). The conference 
agreement reaffirms these priorities.
            Sec. 403. Policy on College Affordability
      The Senate recedes to the House with a substitute. The 
conferees intend that nothing in the budget resolution should 
be construed as indicating support for cuts in college aid to 
students, including but not limited to assistance provided by 
non-profit state agencies.

                    Senses of the House and Congress

Senate Resolution
      Section 335 of the Senate resolution expresses the sense 
of Congress on the State Criminal Alien Assistance Program.
House Amendment
      Title V of the House amendment contains the following 
Sense of the House sections:
      Sec. 501. Sense of the House on servicemembers' and 
veterans' health care and other priorities.
      Sec. 502. Sense of the House on the Innovation Agenda: A 
commitment to competitiveness to keep America #1.
      Sec. 503. Sense of the House on homeland security.
      Sec. 504. Sense of the House regarding the ongoing need 
to respond to Hurricanes Katrina and Rita.
      Sec. 505. Sense of the House regarding long-term 
sustainability of entitlements.
      Sec. 506. Sense of the House regarding the need to 
maintain and build upon efforts to fight hunger.
      Sec. 507. Sense of the House regarding affordable health 
coverage.
      Sec. 508. Sense of the House regarding extension of the 
statutory pay-as-you-go rule.
      Sec. 509. Sense of the House on long-term budgeting.
      Sec. 510. Sense of the House regarding pay parity.
      Sec. 511. Sense of the House regarding waste, fraud, and 
abuse.
      Sec. 512. Sense of the House regarding the importance of 
child support enforcement.
      Sec. 513. Sense of the House on state veterans 
cemeteries.
Conference Agreement
      In Title V of the conference agreement, the Senate 
recedes to Sections 501 through 513 of the House amendment, and 
the House recedes to Section 335 of the Senate resolution, with 
minor technical, clarifying, and conforming amendments. Title V 
includes the following sense of the House and sense of Congress 
provisions:
      Sec. 501. Sense of Congress on Servicemembers' and 
Veterans' Health Care and Other Priorities.
      Sec. 502. Sense of Congress on the Innovation Agenda: A 
Commitment To Competitiveness to Keep America #1.
      Sec. 503. Sense of Congress on Homeland Security.
      Sec. 504. Sense of Congress Regarding the Ongoing Need to 
Respond To Hurricanes Katrina and Rita.
      Sec. 505. Sense of Congress Regarding Long-Term 
Sustainability of Entitlements.
      Sec. 506. Sense of Congress Regarding the Need to 
Maintain and Build Upon Efforts To Fight Hunger.
      Sec. 507. Sense of Congress Regarding Affordable Health 
Coverage.
      Sec. 508. Sense of Congress Regarding Extension of the 
Statutory Pay-As-You-Go Rule.
      Sec. 509. Sense of the Congress on Long-Term Budgeting.
      Sec. 510. Sense of Congress Regarding Pay Parity.
      Sec. 511. Sense of Congress Regarding Waste, Fraud, and 
Abuse.
      Sec. 512. Sense of Congress Regarding the Importance of 
Child Support Enforcement.
      Sec. 513. Sense of the House on State Veterans 
Cemeteries.
      Sec. 514. Sense of the Congress on the State Criminal 
Alien Assistance Program.

                             Reconciliation

Senate Resolution
      The Senate resolution did not include any reconciliation 
instructions.
House Amendment
      Section 601 of the House amendment, which was included at 
the request of the Committee on Education and Labor, instructs 
that committee to report changes in law to the House to reduce 
the deficit by $75 million over six years, no later than 
September 10, 2007. Section 403 of the House amendment includes 
policy language stating that the provision shall not be 
construed to require reductions in assistance that makes 
college more affordable for students.
Conference Agreement
      The Senate recedes to the House with a substitute. The 
conference agreement provides instructions to the Education and 
Labor Committee in the House and to the Health, Education, 
Labor and Pensions Committee in the Senate to report 
legislation by September 10, 2007, to reduce the deficit by 
$750 million over six years.

                          Economic Assumptions

      Section 301(g)(2) of the Congressional Budget Act 
requires that the joint explanatory statement accompanying a 
conference report on a budget resolution set forth the common 
economic assumptions upon which the joint statement and 
conference report are based. The conference agreement is built 
upon the economic forecasts developed by the Congressional 
Budget Office and presented in CBO's ``The Budget and Economic 
Outlook: Fiscal Years 2008-2017'' (January 2007).
Senate Resolution
      CBO's economic assumptions were used.
House Amendment
      CBO's economic assumptions were used.
Conference Agreement
      CBO's economic assumptions were used.

                                  ECONOMIC ASSUMPTIONS OF THE BUDGET RESOLUTION
                                                [Calendar years]
----------------------------------------------------------------------------------------------------------------
                                                              2007     2008     2009     2010     2011     2012
----------------------------------------------------------------------------------------------------------------
Real GDP, Percent Change, Year Over Year..................      2.3      3.0      3.1      3.0      2.7      2.7
GDP Price Index, Percent Change, Year Over Year...........      1.9      1.8      1.8      1.8      1.8      1.8
Consumer Prices, Percent Change, Year Over Year...........      1.9      2.3      2.2      2.2      2.2      2.2
Unemployment Rate, Percent, Yearly Average................      4.7      4.9      5.0      5.0      5.0      5.0
3-Month Treasury Bill Rate, Percent, Yearly Average.......      4.8      4.5      4.4      4.4      4.4      4.4
10-Year Treasury Bond Rate, Percent, Yearly Average.......      4.8      5.0      5.1      5.2      5.2      5.2
----------------------------------------------------------------------------------------------------------------

                              Allocations

      As required in Section 302 of the Congressional Budget 
Act, the joint statement of managers includes an allocation, 
based on the conference agreement, of total budget authority 
and total budget outlays among each of the appropriate 
committees. The allocations are as follows:


   Pay-As-You-Go Scorecard for the Senate Reflecting Levels for the 
                          Conference Agreement

      Period of the current fiscal year, the budget year, and 
the four fiscal years following the budget year: $0.
      Period of the current fiscal year, the budget year, and 
the nine fiscal years following the budget year: $0.

                            House Rule XXVII

      The adoption of this conference agreement by the two 
houses would result in the engrossment of a House Joint 
Resolution changing the statutory limit on the public debt 
pursuant to House Rule XXVII, clause 3. The rule requires a 
joint resolution in the following form:
      Resolved, by the Senate and the House of Representatives 
of the United States in Congress assembled, 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 $9,815,000,000,000.
      Legislative jurisdiction over the public debt remains 
with the Finance Committee in the Senate and the Committee on 
Ways and Means in the House.

                                   Kent Conrad,
                                   Patty Murray,
                                   Ron Wyden,
                                Managers on the Part of the Senate.

                                   John M. Spratt, Jr.,
                                   Rosa DeLauro,
                                   Chet Edwards,
                                 Managers on the Part of the House.