UNITED STATES DEPARTMENT OF THE NAVY

ADMINISTRATIVE RECORD

FY 2013 FURLOUGH APPEALS

TABLE OF CONTENTS1

Tab Date Document Description 

26 20 Feb 13 USD (Comptroller) Robert Hale Press Briefing on Civilian Furlough 

Planning Efforts from the Pentagon 

27 20 Feb 13 *SECDEF Memorandum for DoD Civilian Employees Subj: 

Preparations for Potential Sequestration on March 1 and Furlough 

Notifications

28 20 Feb 13 *DoD Congressional Notification per 10 USC §1597

29 15 Feb 13 Commandant of the Marine Corps Letter Subj: Sequestration 

Impacts; Possible Furloughs 

30 22 Jan 13 Fiscal Director of the Marine Corps Memorandum Subj: Guidance 

for Sequestration and Continuing Resolution Planning 

31 14 Jan 13 *OMB Memorandum 13-03 Subj: Planning for Uncertainty with 

Respect to FY13 Budgetary Resources 

32 14 Jan 13 Budget Guidance Memorandum 12-3A Subj: Implementation of 

Annual continuing resolution and Sequestration on the FY 2013 

DON Budget

33 10 Jan 13 *DEPSECDEF Memorandum for Secretaries of the Military 

Departments Subj: Handling Budgetary Uncertainty in Fiscal Year 

2013 

34 1 Jan 13 *American Taxpayer Relief Act of 2012

35 20 Dec 12 SECDEF Memorandum Subj: “Implications of Ongoing Fiscal Cliff 

Negotiations”

36 25 Sep 12 DEPSECDEF Memorandum Subj: “Guidance on Fiscal Year 2013 

Joint Committee Sequestration”

37 2 Aug 11 *Budget Control Act of 2011

 

1 Documents designated by asterisk were referenced in the Department of the Navy's Notices of 

Proposed Furlough as "supporting materials" which were posted at the following website: 

http://www.public.navy.mil/donhr/Documents/supportingmaterial.pdf. 
U.S. Department of Defense

Office of the Assistant Secretary of Defense (Public Affairs)

News Transcript

On the Web: 

http://www.defense.gov/Transcripts/Transcript.aspx?TranscriptID=5191

Media contact: +1 (703) 697-5131/697-5132

Public contact: 

http://www.defense.gov/landing/comment.aspx

or +1 (703) 571-3343

Presenter: Under Secretary of Defense and Chief Financial Officer Robert F. Hale and Acting Under 

Secretary of Defense for Personnel and Readiness Jessica Lynn Wright

February 20, 

2013 

Department of Defense Press Briefing on Civilian Furlough Planning Efforts from the Pentagon 

 BRYAN WHITMAN: Good afternoon, and thank you for joining us today and for your interest in the topic today of 

sequestration, as well as most of you know by now, in accordance with the law, we have notified Congress today about the 

potential for furloughs. Today, with us we have our undersecretary comptroller, Mr. Bob Hale, and our acting undersecretary 

for personnel and readiness, Ms. Jessica Wright, here to address your questions. They do have some comments that they'd 

like to start with, with respect to sequestration and then the actual action that we took today with respect to notifying 

Congress on furloughs. And then they'll be available to take your questions. I'll help them in terms of getting your questions 

addressed, so -- 

 UNDER SECRETARY ROBERT HALE: Okay. Well, good afternoon. Today, the Department of Defense faces 

some enormous budgetary uncertainty, really unparalleled in my experience. The possibility of sequestration starting on 

March 1. By the end of March, it could mean a $46 billion reduction in our total top line, nine percent in all of our accounts, 

except military personnel, including our wartime accounts. 

 We will protect the wartime operating accounts, but that means larger disproportionate cuts in the base budget, 

operation and maintenance accounts. This is exacerbated by the continuing resolution, which if it stays in effect in its current 

form, has the money in the wrong places. Total dollars are okay, but it's the money in the wrong places. There are too 

many dollars in the investment accounts and too few in operation and maintenance. 

 And there's a pattern here. I already told you, protecting OCO [Overseas Contingency Operations] is going to put 

pressure on base budget operation and maintenance, so, too, will affect that the continuing resolution has not enough O&M 

[Operations & Maintenance] money. 

 And finally, we are spending at a higher than expected rate in our OCO budgets and -- we did not anticipate two 

years ago as much costs for transporting goods in and out of Afghanistan, and we have seen some higher operating tempo. 

Again, we will need to meet those costs, which means still further cuts in the base budget side of operation and 

maintenance. 

 The sum of all those effects means we are seriously short of operation and maintenance funds if sequestration goes 

into effect and the CR [continuing resolution] stays in effect. And this will have serious adverse effects on readiness. 

 So we've taken some short-term actions that I think you're generally familiar with to try to slow our spending, avoid 

more draconian cuts later, hiring freezes for civilians in effect in many of our organizations already, layoffs of temporary and 

term employees, sharp cutbacks in facilities maintenance, cutbacks in base operations. 

 But if sequestration and the CR last all year, there will have to be much more far-reaching changes. We will have to 

make cutbacks and delays in virtually every investment and program in the department, more than 2,500 of them. It will 

mean cutbacks in unit buys. It will mean increases or delays, increases in unit costs. We will have to cut back training, 

particularly for non-deployed units, and that will lead to actions such as about two-thirds of the Army combat and brigade 

teams being at unacceptable levels of readiness by the end of the year, excluding those actually deployed in Afghanistan. 

Most Air Force units that aren't deployed would be at below acceptable readiness levels by the end of the year. 

 You'd see cutbacks in Navy and Marine Corps readiness and deployments. You've already seen that we've decided 

to take a -- have one fewer carrier in the gulf. And, unfortunately, along with this long list of items, we will have to do if

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sequestration and the CR last all year are furloughs for our civilian personnel. 

 We feel we don't have any choice but to impose furloughs, even though we would much prefer not to do it. We're 

more than 20 percent short in O&M, with seven months to go, much higher in some of the services, particularly the Army. 

Civilian personnel make up a substantial part of DOD O&M funding. We can't do reductions in force, especially at this point 

in the year. They'd cost us money in this year because of unused leave and severance pay, so furloughs are really the only 

way we have to quickly cut civilian personnel funding. 

 We have established some general approach to furloughs that we'll follow. One is to make them one of our 

approaches of last resort. We'll also insist on consistency across the department. Essentially, all of our organizations, if we 

have to furlough, will do so in about the same -- for about the same number of days. 

 There will be some very limited exceptions to these furloughs. For example, we will except civilians deployed. We

will not furlough civilians deployed in combat zones. We will not furlough civilians who are required to maintain safety of life 

or property, but only to the extent that they have to do that to maintain safety of life or property. And by that, I mean if there 

are 20 policemen on a base, they don't automatically all -- they're not all automatically exempted from furloughs, only to the 

extent that commanders and managers determine they have to exempt some or all of them in order to maintain a safety in 

life and property. 

 We'll exempt employees paid with non-appropriated funds. It's slightly embarrassing, but it's true by law. Senateconfirmed political appointees are exempt by law, and we will exempt our foreign national employees. 

 So how would furloughs work in general? First, there's a whole series of notifications. We started the first one today, 

with the notification to Congress, along with a message by the secretary of defense to our civilian employees. That starts a 

45-day clock ticking. Until that clock has run out, we cannot proceed with furloughs. 

 We will ask the components now to identify specific exceptions, and we'll review those for consistency. The 

components will begin required engagements with local unions, and will also – and Jess Wright’s organization would notify 

unions with national bargaining rights. 

 At some point in mid-March, we will send a notification to each employee who may be furloughed. That starts a 30-

day clock, waiting period, before we can take any action. And then later on in April, we will send a decision to employees, 

and they have a one-week period, once we've made that decision, to appeal to the Merit Systems Protection Board. 

 The bottom line is, furloughs would not actually start for DOD employees until late April, and we certainly hope that -- 

even if sequestration is triggered on 1 March, we certainly hope that in the interim Congress will act to de-trigger 

sequestration or, if they can't accomplish that goal by March 1, as the president suggested, to take some short-term action 

while they're dealing with the broader issue. 

 Meanwhile, unfortunately, we'll have to continue our planning for furloughs. Frankly, this is one of the least -- or the 

most distasteful tasks I have faced in my four years in this job. But we will work it out. 

 And with that, I'd like to turn it over to Jess Wright, who will talk more about some of the furlough planning actions. 

 UNDER SECRETARY JESSICA WRIGHT: Thanks, Bob. Good afternoon. 

 Let me first say that my focus is clearly on people. Our civilians around the world provide invaluable support to 

national security, our nation's warfighters, and our families. And every day, they make countless contributions to the 

sacrifice -- and sacrifices in support of national defense. 

 The effects of sequestration and the continuing resolution on our military personnel will be devastating. But on our 

civilians, it will be catastrophic. These critical members of our workforce, they work in our depots. They maintain and repair 

our tanks, our aircrafts, our ships. They teach our kids. They care for our children. They provide medical treatment to all of 

our beneficiaries. They take care of our wounded warrior. They provide services and programs such as sexual assault 

prevention and suicide prevention, just to name a few. 

 So let me be clear. The first, the second, and the third order of effect on sequestration will be felt in the local 

commands and will be felt in the local communities all over the United States and, clearly, all over the globe. This is not a 

Beltway phenomenon. More than 80 percent of our civilians work outside of the D.C. metro area. They live and work in 

every state of the union. 

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 If furloughs are enacted, civilians will experience a 20 percent decrease in their pay between late April and 

September. As a result, many families will be forced to make difficult decisions on where their financial obligations lie. Key 

benefits, such as life insurance benefits, health care, and retirement will generally continue. Those programs and policies 

are important -- these important benefits are mandated by the Office of the Personnel Management and they're applied 

consistently to all government employees. 

 Loss of pay won't only be felt by each employee, but it will be felt in the business communities where they serve, 

where their kids go to school and the neighborhoods that they live in. Furloughs will impact the majority of our civilian 

workforce, as Sec. Hale said. And the department will apply those furloughs if necessary in a consistent and an equitable 

fashion, with only few exceptions, as Sec. Hale said, relatively few exceptions. 

 While civilians will experience the impact directly to their wallets, our servicemembers, retirees, and families will 

clearly feel the effect of these actions. If sequestration is not averted, the associated furloughs will impact our warfighters, 

our veterans, and our family members in untold ways. So let me talk about a couple of those ways. 

 With respect to our schools, our goal is to preserve the accreditation of our schools and ensure quality education for 

all of our kids. As we continue to work with the Department of Defense Education Activity on how they will implement the 

furloughs, we are committed in mitigating the impact of sequestration on the school year for our kids. 

 Regarding health care, about 40 percent of our medical providers are civilians. This furlough, if impacted, will affect 

them greatly. But the department's intent and our goal is to mitigate that impact and provide quality care and access of 

care. And we are thoughtfully working through that process now. 

 And certainly, family members will feel the impact of this sequestration. While it's our intent to ease the impact of 

sequestration on family programs, it is clearly possible that operating hours of commissaries will be curtailed. And while it is 

our intent to preserve family members to the -- family programs to the greatest extent possible, some family programs may 

be affected, if the length of sequestration goes long and hard. 

 We understand here in the department that sequestration will be significant, not only to our civilian employees, but to 

the servicemen and women and their families. It will affect local communities, it will affect local businesses, it will affect our 

dedicated men and women that live in the local communities throughout our nation and clearly overseas. We know this. 

 And that's why our guiding principle throughout this process will be to lessen the impacts wherever we can. We are

clearly grateful for the support of our warfighter, and we're clearly grateful for the support of the men and women of our 

civilian force that work to help the warfighter protect their mission. 

 Thank you. 

 MR. WHITMAN: Bob, why don't you start us off, and then Tony has a question. 

 Q: I have a question for Ms. Wright. You mentioned that every -- with regard to the furloughs, that every state would 

be affected. Can you say which states are affected the most? 

 UNDER SEC. WRIGHT: We have not done that research to find out where states will be affected the most. But 

clearly, where we have our large bases, where we have our large depots, they will be affected. 

 I don't know if you want to add to that, Bob. 

 UNDER SEC. HALE: We have some state-by-state data. And it's Virginia, California, I mean, as you might not be 

surprised, as Jess just said. 

 Q: We're talking about the furloughs, not sequestration in general? Or both? 

 UNDER SEC. WRIGHT: Both. 

 UNDER SEC. HALE: No, I'm talking about furloughs -- probably both, but I was talking about furloughs specifically. 

 Q: Virginia and California? 

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 Q: Is that data available? 

 UNDER SEC. HALE: Yeah, we can get you that. I don't see why not. 

 Q: What do you expect (off mic) 

 Q: I have a broader question for you. Both the CBO [Congressional Budget Office] and the Center for Strategic and

Budgetary Assessments have said that a $45 billion cut would basically take the Defense Department back to 2007, 2006 

levels, when you were fighting a huge war in Iraq and Afghanistan. Why can't the department absorb that kind of cut, rather 

than lay it all the -- and that experience all these purported draconian consequences? What's wrong with that picture? You 

seem to have a lot of money, if you look back at '07 and '06. 

 UNDER SEC. HALE: Well, first off, there's a timing issue. I mean, the $46 billion cut will occur five months into the 

year, when we have expended a lot of the -- particularly on the operating side, we've extended -- or we'll have expended 

roughly five-twelfths of the money, so we're going to have to take it in a seven-month period and without, frankly, you know, 

time to get ready. 

 But more generally, I'd say I’m always troubled, if we're trying to determine the adequacy of defense budgets based

on real dollar levels in a particular year. I mean, I think that you need to look at the threats that we face, and they remain

quite substantial, I guess complex set of security challenges is the word. And, therefore, I don't think returning to some 

arbitrary past number for defense makes sense. 

 I mean, we need to -- we owe it to the public to figure out the amount that we think needs to be spent to carry out a 

national defense strategy and then ask for it, and we believe we've done that. 

 Q: One follow-up. Weapons programs, a lot of the industrial base is wondering, will this, in fact, lead to terminations 

of existing contracts? Or is it more slowing down of dollars for new contracts? 

 UNDER SEC. HALE: I don't anticipate that we will cancel many, if any contracts, because we'd incur a substantial 

costs, so it's more the latter, that we will not pick up options, that -- that we may not start or delay starting new contracts, but 

I wouldn't expect that we will terminate existing contracts. 

 And I would like to say, to reassure them, if you've got a contract with us, we're going to pay you. And I believe even 

under sequestration and furloughs, we will find a time to keep our payments to our employers and the vendors on time. 

 Q: Thank you. 

 Q: Can I ask a question about -- 

 MR. WHITMAN: Let's go right here (off mic) 

 Q: If the base number of civilians that work for the Department of Defense is 800,000, how many do you expect to 

be furloughed? And have you said what the estimated savings would be from furloughs? 

 UNDER SEC. HALE: We don't know the exact number yet, because it will depend on those exceptions. First off, it 

will probably be more like 750,000, because about 50,000 of them are foreign nationals, and we decided not to attempt to 

furlough them. But there will be some exceptions that will make it smaller. 

 Our estimate is $4 billion to $5 billion of savings in the remainder of fiscal year 13. And again, it's going to depend on 

how many exceptions there are, and that's a process we've just started to ask our commands to identify. 

 Q: On the -- on the number of -- or the percentage that are likely to be furloughed, I realize you just started that, but 

you -- is it going to be more than 50 percent? And on the - 

 UNDER SEC. HALE: Oh, I think so, yeah. 

 Q: And on the 46,000 temporary and term employees that are being already terminated, can you say how far that 

process is along, how many of those people have been laid off, what percentage (off mic) 

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 UNDER SEC. HALE: I mean, the latest data I saw -- this is an ongoing issue, in -- it was 6,000, 7,000 that are either 

laid off or are in the process of being laid off, but I don't think that's probably the end. I think you'll see more, and I -- but I 

honestly don't know, again -- for those near-term actions, that one in particular, the layoffs, we did allow mission-critical 

exceptions, and we -- and we don't know exactly what our commands will do. 

 Q: At what point will you have the mission critical? 

 UNDER SEC. HALE: Well, I would think, by the end of this month, we'd probably have a pretty good idea, because 

we'll be heading into more detailed planning at that point and actually -- assuming this goes forward, which I sure hope it 

doesn't, that we will be going forward. 

 Q: I have a question about the -- the exemption -- oh, I'm sorry. 

 Q: Go ahead (off mic) 

 Q: Okay. The exemptions. Can you tell us more about who is going to decide -- I mean, who -- which employees to 

exempt from furloughs and how that process works? And do you have any estimates on how much -- how many people 

might be exempted? 

 UNDER SEC. WRIGHT: We have powered down to the services to have them review their civilian employees with 

the -- with the exemption process and criteria that we have given them. 

 You know, I want to bring you back to our civilian workforces. It's hugely invaluable, and they contribute just tons to 

what we do here in the department and worldwide. But saying that, if we have to do this furlough, like Sec. Hale said, 

exemptions will be relatively small. We've asked the services to come back with a plan, to give us the plan on the 1st of 

March. We will review that plan, with the criteria that we've outlined for exemptions, and -- and go forward from there. So 

we don't have a correct -- we don't have a number yet that I can give you on who -- on who -- or a percentage that would be 

exempt. 

 Q: What will life on a military base look like, as far as, you know, with the closures and the stuff that you're talking 

about, the shortened hours? What do you expect to see? 

 UNDER SEC. WRIGHT: As I said in the opening comments, I -- I truly believe that our civilians add such value to the

warfight effort and to life on a military base. And so, if furloughed, we will see a reduction in some of either the services or, 

for example, the commissary hours. 

 So life on a military base, if that base has a commissary, that will impact those individuals that use the commissary. 

And, frankly, until we find out what the exemptions are, until we find out how this is going to be applied, I can't give you a 

daily routine of what -- what a generic day would be on a military base, should we face such a catastrophic event as 

furloughing our civilian employees. 

 UNDER SEC. HALE: Can I answer that in a broader context and add on to what Jess has said? Our personnel are 

committed to carrying out a mission to defend the United States. And I think one thing you're going to see is a great deal of 

frustration, because they will see they can't train as much as they feel they need to and that the readiness of their units is 

degraded. If they're dealing with investments, they'll see disruption on all the programs they're managing, so there will be 

some aspects of daily life that will be affected. But I think that their satisfaction with the mission, if you will, is going to be 

adversely affected, and that's important to these people, both our civilians and our military. 

 MR. WHITMAN: Dan, over here. 

 Q: Does the furlough apply to intelligence employees that are funded by the national intelligence program? 

Because, as you know, the director of national intelligence said that those -- the furloughs should not apply to them. 

 UNDER SEC. HALE: I don't know that a final decision's been made there. We have said, as I mentioned, that for 

DOD employees, other than NIP [National Intelligence Program] employees, we will ensure consistency, decided that, but 

that's a decision that will have to be made by ODNI [Office of the Director of National Intelligence], and I don't know that 

they've made it. 

 Q: So that's a decision for ODNI, not DOD? 

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 UNDER SEC. HALE: I think it would be, in conjunction with the Office of Management and Budget, which will 

oversee this for the government as a whole. 

 Q: And can you give me just a ballpark figure on how many people we're talking about under the NIP? 

 UNDER SEC. HALE: I want to say 25,000. Does that sound right, Mary? All right. 

 MR. WHITMAN: We can get that number. 

 UNDER SEC. HALE: Don't hold me. I think I'd better get back to you. 

 MR. WHITMAN: Let's go right here and then here. 

 Q: Okay. Mr. Hale, you just spoke of frustration on the bases. You know, what -- is there any type of, you know,

study on what impact sequestration and this fiscal uncertainty has had on recruiting or will have on recruitment efforts, 

perhaps hurting commands themselves, but also just the ability of these services to recruit for the future? 

 UNDER SEC. WRIGHT: It could potentially affect the process -- military entrance processing stations, because the -

- some of those individuals are civilian employees. So it could potentially affect the slowdown of that processing, the 

physicals that are performed, the testing that is given. 

 The recruiters are all military. And they are exempt from -- from a furlough. So, you know, the -- the second and

third order of effect of getting somebody in can slow the process. 

 Q: You had said that, by the end of this process, it's possible you have two-thirds of troops would not -- be at 

unacceptable levels of readiness. Will that affect future deployments? I mean, after the -- will that slow down and change 

future deployments? 

 UNDER SEC. HALE: It could. I said two-thirds of the Army active combat brigade teams, other than those that are 

currently deployed, would be at below acceptable levels of readiness. Yes, it could affect their ability to deploy to a new 

contingency, if one occurred, or if this goes on long enough, even to Afghanistan and is a concern. 

 Q: (off mic) you said the OCO budget was higher than expected -- is that entirely because of the Pakistan land route 

close-down costs were higher there? Or is that -- 

 UNDER SEC. HALE: No, there's a variety of reasons. That's part of it, but we were also -- I mean, you are 

estimating operating tempo two years ago when we put together the budget for this year, and we underestimated, 

particularly in the Army and in the Air Force. 

 MR. WHITMAN: Let's go to Mike and then Justin, and then we'll get over to that side of the room. 

 Q: Can I just -- just follow on the readiness question? How much of this -- because we've seen a lot of what appears 

to be a kind of scare tactics from -- from the services that really seem to be pushing out a message of -- of cutting kind of 

security issue things, like readiness. And what's the reality of readiness really being throttled -- throttled back here? You

know, we're still at war, and what the message is, is that this, you know, has a long-term effect and you might have to keep 

troops on the ground longer. 

 I mean, is this something that will -- kind of allowed to be happening -- you know, that will allowed to be pushed down 

the road or -- 

 UNDER SEC. HALE: Well, you know, I mean, we got seven months to go. We're short in the base budget O&M 

about $35 billion compared to the president's budget request, about 23 percent, and that's DOD-wide, and it's probably close 

to twice that in the Army. We don't have a lot of choices. 

 Now, I can hope several things happen. That's the -- the result of sequestration, but also the current continuing 

resolution. If either got fixed, that would help, and we might see some action on either one. If both got fixed, that would help 

a lot. 

 If neither get fixed, if we see the CR extended through the year in its current form and sequestration lasted a year, I 

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think we're going to have serious readiness effects. I don't -- I don't know where we're going to get the money. These are 

legally binding limits. We will have to cut back on training significantly. 

 Q: And we've heard -- we've heard, you know, when -- up on the Hill, when some of the service chiefs are pushed, 

they said, well, you know, we could then move money around – from this account to this account -- for other -- for other 

options. I mean, is -- is that an option for -- for readiness, as well? 

 UNDER SEC. HALE: We could try, but the only means of doing that is reprogramming. And it is a very limited 

technique, in that you've got to find -- so for every dollar you add, you have to cut somewhere else. And especially in an 

environment like this one, where we've seen sequestration cuts in the investment accounts, I don't think there are a lot of 

good sources. And moreover, you've got to get essentially every member of Congress to agree to this, or at least all the 

committees, and therefore it can't be anything contentious. 

 I've had four years of experience with reprogramming, and I think that it is not -- it's not realistic that we could move 

multiple billions. Moreover, there are legal limits on our transfer authority. Could some of this change? Yes. I mean, 

Congress can change the laws in ways that would make this easier. We are doing worst-case planning right now; I think 

that's a fair statement. 

 But if -- again, if the CR stays in effect and sequestration goes into effect for the whole year, I think we're going to 

see serious effects. I am worried. 

 UNDER SEC. WRIGHT: May I add? 

 UNDER SEC. HALE: Sure. 

 UNDER SEC. WRIGHT: If I can follow up and add the -- the people side of the house, if we do furlough the civilian 

employees, the civilian employees are the ones that maintain our equipment in -- in a lot of our depots. They run our ranges 

on posts, so they -- they, if furloughed, will not be there for that training environment. 

 So it's -- it's a second and third order of effect. It's just not the training dollars that can potentially be reprogrammed, 

but it's the people there to utilize and/or perform the jobs that they're required to perform. 

 Q: So the measures you're talking about are fairly drastic. Why wait until today, February 20th, to make these 

announcements? Do you accept the criticisms that the Pentagon should have been warning about these furloughs sooner 

so as to give time or urgency to Congress to do something about it? 

 UNDER SEC. HALE: Well, first, we started some slowdown in spending January 10th, when the deputy issued 

guidance, and we -- a number of the measures I mentioned went into effect shortly after that, hiring freezes, cut backs on 

facilities maintenance. We took significant efforts to try to -- to slow down our spending to avoid more draconian actions 

later. 

 You know, I know that people feel we should have said more earlier. I will say, it was 16 months ago Sec. Panetta 

first sent a letter to the United States Congress, saying the effects of sequestration would be devastating. That was October 

2011. 

 After that, we did a whole series of assessments. We testified in August, and, again, I personally testified in 

September. And we listed every major item we're talking about. We said we'd have to do furloughs. We said there'd be 

cutbacks in readiness. We said that unit buys would go down and unit costs would go up, I mean, all the same things. 

 What we didn't do is detail budget planning. And I don't regret that, because had we done it six or eight months ago, 

it would've all been wrong. We wouldn't have known the effects of the continuing resolution. We wouldn't have known that 

Congress was going to change both the size and the date of sequestration. And moreover, we would have incurred the 

degradation in morale and productivity that's going on right now, and we would have done it six months ago. 

 So I don't regret not doing that. And I think we did sound the alarm in every way we could. 

 MR. WHITMAN: Let's go over to this side of the room (off mic) 

 Q: I'm wondering what kind of contact you're having with the White House and with Congress. There's going to have

to be some cuts, so are you guys trying to offer up any solutions, like, look, don't do sequestration, we'll find some savings 

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for you here, here and here? 

 And also, I'm wondering, what other things would you be doing right now if you weren't spending all your time dealing 

with sequestration? 

 UNDER SEC. HALE: More time with my wife. No. 

 Well, let me answer your first question, which is really -- I think I'm not the right person to answer. I mean, we are 

responsible for providing the nation's security as best we can within the resources that are provided us. 

 We're very interested, obviously, in monitoring closely events, but I think I'd refer you to the White House or OMB. 

And to give you a more serious answer, although I would be spending more time with my wife, you know, when I first took 

this job -- actually, it was the last job I took -- my principal deputy said, you've got an investment and operating problem, 

Bob. You're going to be consumed by the operating side. You got to set aside some things you want to do that will last 

beyond you. 

 I've tried to do that in a couple of ways. One is try to improve financial information in the department and achieve 

auditable statements. Another one is to bring about a course-based certification program for defense financial managers 

and some other issues like that that are getting pretty short shrift right now, because I'm pretty much totally consumed with 

trying to help the department get through this. 

 So I think some longer-term issues that I believe would be good for the Department of Defense -- and I think the 

nation -- aren't getting the attention they would otherwise get. 

 Q: But there's no sense of, like, well, if this is going to happen and it's going to hurt so bad, let me give you some 

other options so that we all can get to this goal of, you know, deficit reduction that everyone seeks. So I'm just wondering, 

would that be a strategy for you guys to say, look, we're staring down the barrel here, let's do this instead, and we're cool 

with this, so let's do it (off mic) 

 UNDER SEC. HALE: Well, I mean, I think the president has made proposals; the Republicans have made 

proposals. I think the adjudication of those or the bargaining probably isn't -- I'm probably not the right guy to -- to be -- to be 

speaking to that, even though I'm intensely interested in the outcome. 

 MR. WHITMAN: Dave and (off mic) 

 Q: Can you explain a little bit of the rationale behind exempting foreign nationals from -- 

 UNDER SEC. HALE: They're governed by status-of-forces agreements and probably would require some 

negotiation. And in some cases, particularly in Japan, they're paid almost entirely by the local -- by the foreign government,

and so that probably wouldn't help us very much. 

 Q: So these are mostly people who are based overseas? 

 UNDER SEC. HALE: Oh, I think they're all based overseas. 

 UNDER SEC. WRIGHT: Oh, absolutely. Yes, yeah. 

 UNDER SEC. HALE: Yeah, these are foreign -- these are Japanese employees in Japan on our bases. 

 Q: (off mic) focus on one of the more important benefits that servicemembers see is the medical care. You 

mentioned, Ms. Wright, that 40 percent of the folks who provide the care are civilians. Well, that's going to cut into the 

services they provide. I think, like, elective surgeries would be canceled or postponed. What -- is that going to happen? 

 And in other times, you could actually throw that onto TRICARE, but TRICARE is going to be affected in this also, 

correct? 

 UNDER SEC. WRIGHT: Everything is going to be affected, should sequestration go in effect. That's a guarantee. I 

think that everybody will be impacted by this action. And I think it's incumbent upon us to try to ease that where we can. 

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 So, yes, 40 percent of our medical providers are civilian employees. A couple of things. Because the war has 

changed, there are less of our uniformed providers that are in the war zone and -- and more so uniform providers that are 

within the confines of our medical treatment facilities. So that is one -- one benefit. 

 It is incumbent upon us to review the plan of Dr. Woodson and the surgeons and the services, as they come in, in 

March, to decide how we are best going to provide care and access to care. And so we will do that. 

 I would like to be able to give you more specifics, but until I see those plans, I would be only speculating, and that 

would be truly unfair. So after March 1, I will have a better understanding of how exactly we will provide the access and the 

care to our beneficiaries. 

 Q: And this gets us through -- even if sequestration comes in. We're all talking about just through September 2013. 

What happens next year? Does it suddenly get better in fiscal 2014? Or could we -- you mentioned RIFs [reductions in 

force] before, but said that there wasn't enough time left this year to do that. Could the civilian workforce be facing RIFs next 

year? 

 UNDER SEC. HALE: Well, I can't rule it out. I mean, the Budget Control Act actually requires that the caps on 

discretionary funding beyond fiscal 13 be lowered for defense by $50 billion to $55 billion a year, I mean, the other agencies,

as well. 

 If those come to pass, then we will have to look at a new defense strategy. That would be the first thing we'd do, that 

would accept more risk and also accommodate a smaller military, and at that point, we would be talking about significant 

reductions in the size of the military workforce, as well, probably as the civilian workforce and -- and many others. The only

difference is, there we would have some time and the ability to do it in a manner that reflects a new strategy, as opposed to 

this kind of across-the-board cuts that we face right now. 

 Q: So we still are facing problems? 

 UNDER SEC. HALE: Yes. I mean, potentially. We can hope for a big budget deal that arrives at some 

accommodation, and that -- and I devoutly would wish for some budget stability right now. And I think it would benefit the 

department and the nation. But absent a deal of that sort, then, yes, I think we'll continue to face some uncertainty into the

future. 

 MR. WHITMAN: We've only got time for a couple more. Let's get a few folks that haven't had a chance (off mic) 

 Q: Hello. Are there any estimates of what kind of impact there will be on the contractor working force and what kind 

of the jobs might be lost? 

 UNDER SEC. HALE: I don't. I mean, there are a lot of private-sector agencies that have made job loss numbers. I'll 

let them speak for themselves. 

 I can tell you that we -- for sequestration, when you take $45 billion, $46 billion, $4 billion to $5 billion of that will 

come from furloughs, if we end up doing them for the maximum period of time. There would be some additional savings 

from laying off temporary and term employees, and I don't know for sure what that would be. 

 But it leaves maybe $40 billion or that is going to be accommodated by cutbacks in purchases from the private 

sector, weapons purchases, service contracts, a lot of different kinds, so there will be very substantial effects on the private 

sector, as well. And -- but I -- I can't give you job loss numbers, although there are a number of private organizations that 

have made estimates. 

 Q: What -- what specific changes in law would you like to see Congress make to give you more flexibility to manage

this challenge? And also, in FY [fiscal year] 14, what sorts of cuts are you having to make? And what's your top line, do you

expect? 

 UNDER SEC. HALE: Well, first off, the change I want the United States Congress to make is to -- is to pass a 

balanced budget deficit reduction package that the president can sign and de-trigger sequestration and to pass 

appropriations bills. That's what I'd like for Christmas; I know it's late, but I really would like it. That's what would solve our 

problem. 

 In terms of -- of flexibility, you know, we're five months into the fiscal year, facing a $46 billion cut, even if you said 

you can do it wherever you want, we would have to go after just about every dollar that isn't obligated in order to get those 

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cuts that quickly. 

 And -- and I know that there have been suggestions that, well, we can just, quote, "solve this problem" by giving 

flexibility, I don't think it would help that much this far into the fiscal year. And if it makes sequestration more likely to either 

occur or persist, I think it's a bad deal, the flexibility. 

 As far as the future, at the moment, the guidance we have from OMB is not to count on these -- not to plan for these 

large cuts that could occur under the Budget Control Act if Congress doesn't make some change in the law the president can 

accept and they go into effect. Then, yes, we would have to -- as I said to the other question, we would have to look at a 

new defense strategy, a smaller military, and that would include a smaller civilian workforce and a variety of other changes. 

 Q: So what number are you planning to in FY 14? 

 UNDER SEC. HALE: You know, that -- I'm not -- I can't give you that number until they release the budget, but it's

not too far off from the numbers we were planning a year ago for fiscal 14. Does that help? 

 Q: (off mic) 

 UNDER SEC. HALE: I wish I knew. They've said mid-March, they being OMB, and they will make this decision, but I 

don't have a specific date. 

 Q: (off mic) mid-March versus mid-April or early (off mic) 

 UNDER SEC. HALE: I believe they've said mid-March. 

 Q: Let me try one more specifically on the service contractor workforce. The department has described them as part 

of the total force many times. You seem like you have a pretty solid plan on the civilian workforce and how you're going to 

handle that and how they're going to contribute to the O&M reductions. Is there a similar detailed plan on the contractor 

workforce? 

 UNDER SEC. HALE: Well, it's managed differently, in the sense that we go out to the private sector and -- and order 

services, and they, of course, manage their workforce, so we wouldn't be involved in that. We are developing plans with 

increasing levels of detail for the -- what we would buy from the private sector, in the process of looking at all of our 

investment programs, 2,500 of them -- it takes a lot of work -- to figure out what we won't do to accommodate sequestration 

cuts and similarly in the service contract area. 

 I won't tell you all of that's done, but we're -- we're moving along well. I think we will be ready for sequestration, if we 

have to, by March 1. And under the law, we owe a detailed spend plan by April 1. And that would give more fidelity on 

exactly the changes. But in terms of managing the workforce, that's really something that will be done by the private 

companies. 

 MR. WHITMAN: Let’s bring this to an end, but let's go back here and we'll let you finish it (off mic) 

 Q: On the FY 14 budget, do you expect to roll it out in parts, to roll out the base budget and the OCO budget 

separately, the other parts separately? Will we be getting it in pieces (off mic) 

 UNDER SEC. WRIGHT: I think that's possible. I mean, for the OCO budget, we need troop level decisions. We're 

getting those now, after the State of the Union message, but we still have to put that budget together, so they may not come 

out together. I just don't -- since I don't know the exact timing of release, I can't be sure, but they may come out separately. 

 Q: Okay, and this is just actually a numbers clarification thing, so it's not a good one to end on. But given that you're 

five-twelfths of the way through the year, you've got -- you're exempting military personnel. There are some civilian 

exemptions. And in warzones, there's going to be -- (inaudible) -- exempted. What percent -- this $48 billion represents 

what percent of the available pie that could be cut? I mean, when you take all those other numbers out, it's not just a 20 

percent of the last half year, so it's less than that, isn't it? What's the potential pie that you're cutting? 

 UNDER SEC. HALE: Oh, I see what you mean. Well, in the -- you know, the problem is, the investment -- I'd say 

divide $46 billion by five-twelfths, but that wouldn't be right, because the investment accounts tend to obligate slowly. And I 

don't know that I have that number in my head. I mean, I'm going to guess we're a quarter obligated now overall. 

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 Does that sound roughly right, Mary? 

 UNDER SEC. HALE: All right. And so we've got three-quarters left, and we're taking $46 billion out. Don't hold me 

to that too closely, please. But it's probably in that ballpark, because the investment accounts tend to obligate more toward 

the end of the year. 

 MR. WHITMAN: All right, folks. Thank you again for your interest in this. And if we have any follow-up questions, 

please don't hesitate to go to the press office. We'll try to get an answer for you.

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DEPARTMENT OF THE NAVY 

HEADQUARTERS UNITED STATES MARINE CORPS 

3000 MARINE CORPS PENTAGON 

WASHINGTON, DC 20380-1775 

From: Commandant of the Marine Corps 

To: My Civilian Marines 

Subj: SEQUESTRATION IMPACTS; POSSIBLE FURLOUGHS 

IN RBPLY RBPBR TO: 

12351 

CL 

1. Civil ian Marines are critical to the Marine Corps' role in 

protecting our Nation . I appreciate that you have already 

sacrificed through a decade of high tempo deployments and combat 

operations. You have remained by our side during nearly three 

years of pay freezes and increasing work. Thank you for all that 

you do and have done for our Corps and country . Unfortunately, I 

may have to ask you to do even more. 

2. As you are aware, there has been much speculation about our 

current fiscal situation. This is my first opportunity to address 

the matter with you. Our Nation's political leaders are working 

hard to resolve these issues. One issue involves what is referred 

to as "sequestration"-or across the board budget reductions-which 

could take effect on March 1, 2013, absent further legislation. 

The President has expressed his intention to exempt military 

personnel funding from these cuts. The law does not, however, 

permit similar civilian funding protections. 

3. There is no shortage of examples of Civilian Marine 

dedication. In the past year, 66 employees crossed the 40 year 

service milestone; another 1,300 employees have 30 years of 

service . One of those with 40 years has been a mainstay at 

Headquarters Marine Corps, faithfully serving through the 9/11 

attacks and the following decade of war. Our civilians are 

interwoven throughout, contributing to our entire organization. 

Our nearl y 450 Family Readiness Officers directl y support the 

operating forces, allowing our operators to focus on the mission 

at hand. A group of 36 Civil ian Marines in the Marine Corps 

Fac i lity Services Directorate are universally recognized for 

enabling operators to conduct realistic training and effectively 

execute their missions. These Civilian Marines typify the 

remarkable performance of over 20,000 Civilian Marines serving our 

Corps. 

4. Every civilian in our organization is important to me, just as 

is every Marine. I want to ensure that all Civilian Marines, as 

well as the Marines and Sailors within our ranks, understand that 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 278
I intend to do my utmost to ensure that the Marine Corps continues 

to accomplish its missions, while keeping faith with you. 

5. The current situation requires tough decisions. With or 

without sequestration, challenging fiscal times lie ahead . In 

addition to our active duty force reductions of 20,000 Marines, I 

anticipate reductions in programs and other areas. The Marine 

Corps, like the rest of our Armed Forces, will have to find ways 

to accomplish missions within reduced budgets. Some form of 

reduction in civilian personnel accounts over the coming year is 

likely unavoidable. As a result, there may be administrative 

furloughs. Potential actions will only occur after a careful 

examination of other viable cost-reduction options. 

6. Our continued success will be built on a team approach, one in 

which everyone involved is kept fully informed to the extent 

possible. Your expertise and insights will add value to the 

effort. While I know that it's difficult, our situation requires 

patience so that we can properly analyze our options. No matter 

what happens, we will work together to minimize any adverse 

impacts on the mission, and reduce as much as possible any adverse 

effects on you and your family. 

7. I greatly appreciate the importance of what our Civilian 

Marines do each and every day, the sacrifices you make on behalf 

of our Nation, and the value you add to our Corps. You have all 

contributed through your service to our organization; 

unfortunately, this situation may require me to ask you to 

sacrifice yet again. We are one Marine Corps family, and we will 

continue as such. Regardless of what may lie ahead, I know that 

as a team we can successfully weather any challenge . In its truest 

sense, I remain ... 

2 

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EXECUTIVE OFFICE OF THE PRESIDENT 


OFFICE OF MANAGEMENT AND BUDGET 


WASHINGTON, D. C . 20503 


January 14,2013 

M-13-03 

MEMORANDUM FOR THE HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES 

FROM: 	 Jeffrey D. Zien!s ~Q~ Deputy Director a.nagement 

SUBJECT: 	 Planning for Uncertainty with Respect to Fiscal Year 2013 Budgetary Resources 

In the corning months, executive departments and agencies (agencies) will confront 

significant uncertainty regarding the amount of budgetary resources available for the remainder 

of the fiscal year. In particular, unless Congress acts to amend current law, the President is 

required to issue a sequestration order on March 1,2013, canceling approximately $85 billion in 

budgetary resources across the Federal Government. Further uncertainty is created by the 

expiration ofthe Continuing Appropriations Resolution, 2013 (CR) on March 27,2013. This 

memorandum directs agencies to take certain steps to plan for and manage this budgetary 

uncertainty. 

The Administration continues to urge Congress to take prompt action to address the 

current budgetary uncertainty, including through the enactment of balanced deficit reduction to 

avoid sequestration. Should Congress fail to act to avoid sequestration, there will be significant 

and harmful impacts on a wide variety of Government services and operations. For example, 

should sequestration remain in place for an extended period of time, hundreds of thousands of 

families will lose critical education and wellness services through Head Start and nutrition 

assistance programs. The Department of Defense will face deep cuts that will reduce readiness 

of non-deployed uni.ts delay needed investments in equipment and facilities, and cut services for 

military families. And Federal agencies will likely need to furlough hundreds ofthousands of 

employees and reduce essential ervices uch a food inspections, air travel safety, prison 

security, border patrols, and other mission-critical activities. 

At this time, agencies do not have clarity regarding the manner in which Congress will 

address .these issues or the amount of budgetary resources that will be available through the 

remainder of the fiscal year. Until Congress acts, agencies must continue to prepare for the 

possibility that they will need to operate with reduced budgetary resources. 

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Prior-to passage ofthe American Taxpayer Relief Act of2012 (ATRA), the President 

was required to issue a sequestration order on January 2, 2013. Although the ATRA postponed 

this date by two months, agencies had already engaged in extensive planning for operations 

under post-sequestration funding levels before this postponement was effected. In light of 

persistent budgetary uncertainty, all agencies should continue these planning activities, in 

coordination with the Office of Management and Budget COMB), and should intensify efforts to 

identify actions that may be required should sequestration occur. 

Agencies should generally adhere to the following guiding principles, to the extent 

practicable and appropriate, in preparing plans to operate with reduced budgetary resources in 

the event that sequestration occurs: 

• 	 use any available flexibility to reduce operational risks and minimize impacts on the 

agency's core mission in service ofthe American people; 

• 	 identify and address operational challenges that could potentially have a significant 

deleterious effect on the agency's mission or otherwise raise life, safety, or health 

concerns; 

• 	 identify the most appropriate means to reduce civilian workforce costs where necessarythis may include imposing hiring freezes, releasing temporary employees or not renewing 

term or contract hires, authorizing voluntary separation incentives and voluntary early 

retirements, or implementing administrative furloughs (appropriate guidance for 

administrative furloughs can be found on the OPM website [herel); consistent with 

Section 3(a)(ii) of Executive Order 13522, allow employees' exclusive representatives to 

have pre-decisional involvement in these matters to the fullest extent practicable; 

• 	 review grants and contracts to determine where cost savings may be achieved in a manner 

that is consistent with the applicable terms and conditions, remaining mindful of the 

manner in which individual contracts or grants advance the core mission ofthe agency; 

• 	 take into account funding flexibilities, including the availability ofreprogramming and 

transfer authority; and, 

• 	 be cognizant ofthe requirements ofthe Worker Adjustment and Retraining Notification 

(WARN) Act, 29 U.S.C. §§ 2101-2109. 

While agency plans should reflect intensified efforts to prepare for operations under a 

potential sequestration, actions that would implement reductions specifically designed as a 

response to sequestration should generally not be taken at this time. In some cases, however, the 

overall budgetary uncertainty and operational constraints may require that certain actions be 

taken in the immediate- or near-term. Agencies presented with these circumstances should 

continue to act in a prudent manner to ensure that operational risks are avoided and adequate 

funding is available for the remainder ofthe fiscal year to meet the agency's core requirements 

and mission. Should circumstances require an agency to take actions that would constitute a 

change from normal practice and result in a reduction of normal spending and operations in the 

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immedjate- or near-term, the agency must coordinate closely with its OMB Resource 

Management Office (RMO) before taking any sucb actions. 

All agencies should work with their OMB RMO on the appropriate timing to submit draft 

contingency plans for operating under equestration for review. Furthermore, should Congress 

take action that affects the current budgetary uncertaint), OMB will provide agencies with 

additional guidance as appropriate. 

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 The FY 2013 Overseas Contingency Operation (OCO) budget request. 

 The FY 2012 and earlier prior year unobligated balances for active accounts. The current 

forecast for unobligated balances in this guidance uses data through 31 December 2012. 

Sequestration Impact = (FY 2013 Annualized CR + FY 2013 OCO request + PY Unobligated Balances) * 9% 

a. Until a more definitized sequestration number is available, a 9% reduction will be applied 

to the sequestration base shown above. BSOs should be aware that the unobligated balance 

forecast will be updated to include an obligation projection through the end of February of 2013 

for final planning estimates, however, this data will not be available from OSD until ~20 

January. Revised OSD unobligated balance data will be provided as soon as available. FMB 

will work with BSOs where any significant changes are observed. 

b. The DON also assumes that it will be expected to continue to operate within the 

limitations of an annualized Continuing Resolution, which reduces flexibility - no FY 2013 new 

starts and no quantity increases from the FY 2012 enactment to the FY 2013 CR level. As a 

result, the program control will be established as follows: 

(1) The sequestration reduction described above will be applied to the lower of either the FY 

2013 Annualized CR amount (FY 2012+0.612%), or the FY 2013 President’s Budget 

Request. 

(2) Military Personnel funding is excluded from sequestration action but not from the CR. 

(3) Where the PB13 amount was lower than the annualized level of the FY2013 CR, no CR 

adjustment has been made. Where the FY 2013 CR amount was lower than PB13, an 

adjustment has been entered - - thereby picking the lower of either the FY 2013 annualized 

CR or PB13 amounts. 

(4) The purpose for this is to exclude funds from consideration that might not materialize under 

an appropriation that would artificially enhance budgets. 

c. Enclosure (1) reflects the proposed controls as articulated above. Due to the large 

number of prior year projects and the large prior year balances in SCN and MILCON, including 

many ships and projects that do not have funding in FY 2013, enclosure (1) provides total 

sequestration amounts at the appropriation level for SCN, MCN, MCNR, and FHCON. 

Distribution by fiscal year and line item will be provided separately by FMB 2. 

d. While there may be reprogramming authority or other mechanisms provided later for 

realignments across appropriation, this DON effort presumes no flexibility for realignments 

within the FY 2013 CR. Also, the sequestration reductions provided must be applied at the PPA 

level (P-1/R-1/C-1) for investment accounts in FY 2013, but may be realigned among FY 2013 

and prior years with active and available unobligated balances. Enclosure (2) provides a 

template for BSOs to complete to report recommended adjustments across fiscal years within a 

P-1/R-1/C-1 line item. 

5. Civilian Personnel. 

a. Hiring Freeze. Per references (a) and (b), a hiring freeze is now in effect for Navy 

commands. This hiring freeze will be managed by BSO Commanders. Hiring actions may be 

performed under the hiring freeze for critical billets that the Commander defines as “essential.” 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 290
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No additional job offers will be made by the OCHR Human Resources Service Centers until 

each BSO develops and issues their hiring freeze plan. BSOs must satisfy their local union 

notification and bargaining requirements associated with their plan. The Marine Corps direction 

regarding potential civilian personnel actions will be issued by HQMC to reflect decisions by the 

Commandant, as applicable. Any Marine Corps hiring freeze will be announced separately and 

managed by HQMC. ASN(M&RA) will work with individual BSOs to address questions and 

approve hiring freeze plans. ASN(M&RA) POC for the hiring freeze is Mr. Doug Lundberg at 

Douglas.Lundberg@navy.mil. 

1) BSOs are alerted that for reimbursable billets the fund holder must coordinate with the BSO 

early enough to ensure that the reimbursable workforce is planned, available, and funded. 

2) More specifically, NAVSEA and the Shipyards must coordinate with the Fleets, as the fund 

holder, to ensure proper levels of reimbursable workforce are planned and funded. Joint 

decisions to determine essential work and appropriate work force are essential. 

3) Beyond the Fleet workforce, BSOs must be sensitive to other reimbursable work, e.g., 

SOCOM, DHP, Intelligence, and FMS 

4) DoD has authorized voluntary separation incentives and voluntary early retirements. BSOs 

can look at this option when considering personnel action. 

b. Civilian Personnel Furlough. If implemented, civilian furloughs will be centrally 

managed and will be a government-wide effort with limited exceptions. The White House will 

control future guidance with respect to a civilian furlough. Within this effort, BSOs should 

assume in their implementation plans a one-day furlough per week starting 16 April 2013 and 

continuing for 22 weeks. In any cases where risk to safety or security are untenable, BSOs 

should submit an impact statement highlighting the specific issue or circumstance that will result 

from the furlough. In the event a furlough is not authorized, BSOs should be assessing 

alternative measures to achieve the required reductions. OCHR will provide supplemental 

guidance on furloughs. ASN(M&RA) POC for furloughs is Mr. Doug Lundberg at 

Douglas.Lundberg@navy.mil. 

c. Temporary and Term Employment. Per references (a) and (b), BSO Commanders are 

authorized to reduce temporary and term employee levels. BSO Commanders will manage this 

effort for critical billets that the Commander defines as “essential.” BSOs are reminded that Tier 

Alpha presumed a level of savings from these cuts. If temp and term savings do not materialize, 

BSOs would have to offer alternate cuts. The termination of term employees may require 

advance notice and appeal rights. When developing plans, BSOs should not propose releasing 

temporary employees prior to 15 February. You should consult with OCHR if terminating term 

employees is part of your proposed action plan. ASN(M&RA) POC for temporary and term 

employee action is Mr. Doug Lundberg at Douglas.Lundberg@navy.mil.

d. Navy Working Capital Fund (NWCF). As civilian personnel at NWCF entities are driven 

by workload requirements, coordination between customers and WCF entities is critical to 

ensuring an appropriately sized WCF workforce. Revised customer spend plans will drive 

changes to WCF requirements. Requirements from paragraph 4.a, 4.b, and 4.c above apply to 

WCF employees as well. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 291
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6. Implementation Plans and Impact. Based on the CR and sequestration targets provided in 

enclosure (1), BSOs will develop implementation plans in PBIS for O&M, SCN, and Military 

Construction and will submit sequestration impact statements based on the below direction. 

Specific direction is as follows: 

a. Operation and Maintenance Accounts. FMB has coordinated extensively with BSO 

Comptrollers on the development of Tier Alpha cuts to address the CR, and is working on Tier 

Bravo options to deal with sequestration reductions. Revised BSO targets for the CR and 

sequestration adjustments are provided in enclosure (1) and in a new PBIS control table entitled 

“Sequestration Planning Control”. BSOs will note that CR and sequestration targets are 

provided at the appropriation level of funding, and these adjustments must be spread by AG SAG 

in PBIS. As stated, CR rules allow BSOs flexibility to apply the CR adjustments as appropriate 

to achieve the previously coordinated Tier Alpha reductions - - sequestration cuts to be addressed 

by the Tier Bravo options will be developed. BSO implementation plans will be due in PBIS to 

FMB NLT than 25 January 2013. For updates to any unexpected O&M adjustments in Tier 

Alpha, BSOs will submit an implementation impact statement to FMB1 describing the change. 

In addition, the following should be provided per reference (a): 

 Extent of civilian hiring freezes, expected number of temps/terms released; impact of the 

furlough. 

 Reduction to Flying Hour, Steaming Days, Vehicle Miles and other operations/training/support 

activities that affect force readiness. 

 Any areas receiving disproportionate cuts 

Questions regarding O&M implementation plans or impact statements should be forwarded to 

James.Moser@navy.mil or james.moser@navy.smil.mil. 

b. Investment Accounts: For procurement, research and development accounts, 

sequestration and CR impacts (where applicable) are applied at the Line Item (P-1, R-1) level of 

detail. Sequestration adjustments may be made for all investment programs at the PPA level by 

realigning the sequestration reduction among FY13 funding and any prior years with active and 

available unobligated balances. These recommended adjustments will be provided to FMB 2 in 

the enclosure (2) template addressed in paragraph 3.d and will be entered in PBIS for Issue 

64293 at the P-1, R-1 and C-1 level of detail. BSO input for PBIS records and enclosure (2) will 

be due to FMB NLT than 25 January 2013. 

For significant investment programs (ACAT 1D, ACAT 1C, MAIS, Joint, Special Interest) an 

implementation impact statement will be submitted to FMB 2. Enclosure (3) provides the 

template to be used to report recommended sequestration adjustments among fiscal years for a 

line item, the impact of a year-long CR (funding, authorization, new starts, quantity impact, rate 

of operations, multiyear procurement), and the impact to the program of the sequestration 

reduction. Enclosures (2) and (3) will be used for the development of the DON submission to 

OSD, possible year-long CR anomalies, and follow-on actions to sequestration. Questions 

regarding investment spend plans or impact statements should be forwarded to 

Burchard.Jackson@navy.mil or Burchard.Jackson@navy.smil.mil . 

c. Construction and Family Housing accounts. NAVFAC will work with FMB2 to report 

CR and sequestration impact by project and year for Military Construction and Family Housing 

Construction. In addition, for Family Housing Operations, any Quality of Life issues should be 

identified. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 292
5 

d. Navy Working Capital Fund (NWCF). NWCF activities should coordinate with the 

BSOs on potential reductions in customer funding for their planned DON orders. BSOs are 

requested to complete enclosure (4) to indicate where proposed reductions will significantly 

impact NWCF customer orders. This information will be used in a subsequent data call to 

NWCF Activities to assess changes to FY 2013 financial operations, including revenue and net 

operating results. Questions on this template should be directed to the acting FMB 41, CDR 

Steve Macdonald, at 703-692-4842. 

e. Military Personnel. While Military personnel accounts were exempted by sequestration, 

they are affected by the continuing resolution. BSOs will submit revised implementation plans 

for military personnel accounts to account for the impacts of the CR highlighted in enclosure (1) 

and are due to FMB NLT than 25 January 2013. BSOs should take into account any underexecution in FY 2013 that will result in surpluses and report these via enclosure (3) to FMB1. 

f. Conferences for all Appropriations. Any government-sponsored conferences scheduled 

from January to March 2013 should be postponed to April or beyond. Per current approval 

authorities, re-approval is required for those conferences that cannot be easily delayed, are 

considered absolutely mission essential, or are required to maintain professional license or 

equivalent certifications. Re-approval will be contingent on showing estimated costs have been 

minimized to the greatest degree possible. For non-government sponsored conferences, U.S. 

government participation is not prohibited, but should contribute to the DON's mission and be 

adjusted to minimize costs, especially travel and lodging. Invited speakers included in 

conference requests should seek the approval of the next higher command level to verify speaker 

need before the conference request is submitted for re-approval. All future conference requests 

will include a FO/GO/SES endorsement highlighting how costs have been minimized and 

whether the conference is mission critical and/or fulfills license and certification requirements. 

g. Travel and Training for all Appropriations. All non-mission essential travel and training 

should be minimized to the greatest degree possible. The first FO/GO/SES in the chain of 

command should determine whether travel is mission essential. This guidance is effective 

through 1 April. It will then be reviewed and adjusted based on the outcome of the final FY 

2013 topline. 

7. New Starts, Quantity Increases and Multiyear Procurements. While under a year-long CR, 

DoN commands do not have the authority to initiate any FY 2013 new starts, multiyear 

procurements, or contract for increases in procurement over FY 2012 quantities. These limits 

must be considered by BSOs when developing investment implementation plans. The impact 

statements should address any problems with these CR limitations which may later be included 

as legislative proposals or anomalies in requesting relief form OMB and /or congress. 

8. Control of pre-decisional information. Participants are reminded that discussion of 

sequestration information outside of DoD is not permitted. 

9. Congressional and Public Affairs Guidance. CHINFO is the central control authority for 

messaging and the DON narrative related to either the CR, or sequestration. Requests for 

information from any organization on these topics should be coordinated with CHINFO to 

ensure a consistent message that includes the OSD/SECNAV perspective is provided. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 293
Department of the Navy Administrative Record for FY 2013 Furlough Appeals 294
7 

Distribution: 

Director, Field Support Activity (FSA) 

Department of the Navy Assistant for Administration (DON/AA) 

Chief of Naval Research (OCNR) 

Director, Office of Naval Intelligence (ONI) 

Chief, Bureau of Medicine and Surgery (BUMED) 

Commander, Naval Air Systems Command (NAVAIR) 

Chief, Naval Personnel (CHNAVPERS) 

Commander, Naval Supply Systems Command (NAVSUP) 

Commander, Naval Sea Systems Command (NAVSEA) 

Commander, Naval Facilities Engineering Command (NAVFAC) 

Commandant of the Marine Corps (HQMC) 

Director, Strategic Systems Programs (SSP) 

Commander, Military Sealift Command (MSC) 

Commander, Space and Naval Warfare Systems Command (SPAWAR) 

Director, Naval Systems Management Activity (NSMA) 

Commander, Navy Installations (CNI) 

Commander, U.S. Fleet Forces Command (COMUSFLTFORCOM) 

Commander, U.S. Pacific Fleet (COMPACFLT) 

Commander, Naval Reserve Force (COMNAVRESFOR) 

Commander, Naval Special Warfare Command 

Copy to: 

Immediate Office of the Secretary (ASN(FM&C), ASN(E,I&E), ASN(M&RA), 

ASN(RD&A) only) 

Staff Offices (DON CIO, JAG, and OLA only) 

Chief of Naval Operations (N09, DNS, N093, N095, N097, N1, N2/N6, N3/N5, N4, N8, 

N80, N81, N83, N84, N89, N9, N9I, N95, N96, N97, N98 only) 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 295
DEPUTY SECRETARY OF DEFENSE 

1010 DEFENSE PENTAGON 

WASHINGTON, DC 20301 · 1010 JAN 1 0 2013 

MEMORANDUM FOR SECRETARIES OF THE MILITARY DEPARTMENTS 

CHAIRMAN OF THE JOINT CHIEFS OF STAFF 

UNDER SECRET ARIES OF DEFENSE 

DEPUTY CHIEF MANAGEMENT OFFICER 

DIRECTOR, COST ASSESSMENT AND PROGRAM EVALUATION 

DIRECTOR, OPERATIONAL TEST AND EVALUATION 

GENERAL COUNSEL OF THE DEPARTMENT OF DEFENSE 

INSPECTOR GENERAL OF THE DEPARTMENT OF DEFENSE 

ASSIST ANT SECRETARIES OF DEFENSE 

DEPARTMENT OF DEFENSE CHIEF INFORMATION OFFICER 

ASSISTANTS TO THE SECRETARY OF DEFENSE 

DIRECTOR, ADMINISTRATION AND MANAGEMENT 

DIRECTOR, NET ASSESSMENT 

DIRECTORS OF THE DEFENSE AGENCIES 

DIRECTORS OF THE DOD FIELD ACTIVITIES 

SUBJECT: Handling Budgetary Uncertainty in Fiscal Year 2013 

Two sources of uncertainty are creating budgetary challenges for the Department of Defense 

(DoD) in 2013. The first is the fact that the Department is operating under a Continuing Resolution 

(CR) through at least March 27, 2013. Because most operating funding was planned to increase 

from Fiscal Year (FY) 2012 to FY 2013, but is instead being held at FY 2012levels under the CR, 

funds will run short at current rates of expenditure if the CR continues through the· end of the fiscal 

year in its current form. The Secretary will continue to urge the Congress to enact appropriations 

bills for FY 2013. But if the CR were to be extended through the end of the fiscal year, it would 

hinder our ability to maintain a ready force. 

The second source of uncertainty is the potential sequestration recently deferred from 

January 2, 2013 to March 1, 2013 by the American Taxpayer Relief Act of2012. The possibility of 

sequestration occurring as late as the beginning of the sixth month of the fiscal year creates 

significant additional uncertainty for the management of the Department. 

Either of these problems, in isolation, would present serious budget execution challenges to 

the Department, negatively impacting readiness and resulting in other undesirable outcomes. This 

situation would be made even more challenging by the need to protect funds for wartime operations. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 296
Near-Term Actions 

Given the overall budgetary uncertainty faced by the Department, and in particular the 

immediate operational issues presented by the CR, it is prudent to take certain steps now in order to 

help avoid serious future problems. I therefore authorize all Defense Components to begin 

implementing measures that will help mitigate our budget execution risks. For now, and to the 

extent possible, any actions taken must be reversible at a later date in the event that Congress acts to 

remove the risks I have described. The actions should be structured to minimize harmful effects on 

our people and on operations and unit readiness. 

Categories of approved actions are identified in Table 1. The authority to implement these 

actions shall remain in effect until they are revoked in a subsequent memorandum from my office. 

If Components believe they must take actions that go beyond the categories listed in Table 1, they 

should present the options for my review and approval prior to their implementation. 

Intensified Planning for Longer-Term Budgetary Uncertainty 

Given the added challenge of a potential sequestration in March, we must also intensify 

efforts to plan future actions that might be required should that happen. This planning does not 

assume these unfortunate events will occur, only that we must be ready. 

As they formulate draft plans, Components should follow the guidance that directs the 

Department to take all possible steps to mitigate harmful effects associated with this budgetary 

uncertainty and to maintain a strong defense. The details of the guidance are summarized below: 

• For the operating portions of the DoD budget: 

o Exempt all military personnel funding from sequestration reductions, in accordance 

with the decision made by the President in July 2012. 

o Fully protect funding for wartime operations. 

o Fully protect Wounded Warrior programs. 

o To the extent feasible, protect programs most closely associated with the new 

defense strategy. 

o Reduce civilian workforce costs using the following actions (all subject to missioncritical exemptions, and appropriate consultation with union representatives 

consistent with Executive Order 13522): 

• Release temporary employees and do not renew term hires. 

• Impose hiring freezes. 

• Authorize voluntary separation incentives and voluntary early retirements to the 

extent feasible. 

• Consider the possibility of furloughs of up to 30 calendar days or 22 

discontinuous workdays. 

o To the extent feasible, protect family programs. 

2 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 297
o To the extent feasible, protect fi.mding most directly associated with readiness; focus 

the necessary cuts on later deploying units. 

• For the investment portions of the DoD budget (procurement, RDT&E, construction): 

o Protect investments fi.mded in Overseas Contingency Operations if associated with 

urgent operational needs. 

o To the extent feasible, protect programs mostly closely associated with the new 

defense strategy. 

o Take prudent steps to minimize disruption and added costs (e.g., avoid penalties 

associated with potential contract cancellations where feasible; prudently manage 

construction projects fi.mded with prior-year monies). 

While we are hopeful of avoiding budgetary problems, draft Component plans should reflect 

the possibility that we may have to operate under a year-long CR and that sequestration takes place. 

Table 2 shows the types of information that should be included in the plans. Components should 

submit these draft plans to the Under Secretary of Defense (Comptroller) by February 1, 2013. The 

Under Secretary of Defense (Comptroller) will work with the Components to adjust this schedule if 

changes are required due to the deadlines for the preparation of the FY 2014 President's Budget 

submission. 

I appreciate your patience as we work through these difficult budgetary times. The 

Department will continue to do its best to resolve these budgetary uncertainties in a manner that 

permits us to support our current defense strategy and maintain a strong defense. 

If addressees have questions about this memorandum, they should direct them to the Under 

Secretary of Defense (Comptroller). 

Attachments: 

As stated 

3 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 298
Table 1. Categories of Approved Near-Term Actions 

• Freeze civilian hiring (with exceptions for mission-critical activities*). 

• Provide authority to terminate employment of temporary hires and to notify term employees 

that their contracts will not be renewed (with exceptions for mission-critical activities and 

when appropriate in terms of personnel timing*). 

• Reduce base operating funding. 

• Curtail travel, training, and conferences (all with exceptions for mission-critical activities* 

including those required to maintain professional licensure or equivalent certifications). 

• Curtail facilities maintenance or Facilities Sustainment, Restoration, and Modernization 

(FSRM) (with exceptions for mission-critical activities*). 

o If necessary, services/agencies are authorized to fund FSRM at levels below current 

guidance. 

• Curtail administrative expenses such as supply purchases, business IT, ceremonies, etc. 

(with exceptions for mission-critical activities*). 

• Review contracts and studies for possible cost-savings. 

• Cancel3rd and 4th quarter ship maintenance availabilities and aviation and ground depotlevel maintenance activities. Take this action no earlier than February 15, 2013. 

• Clear all R&D and production contracts and contract modifications that obligate more than 

$500 million with the USD(AT &L) prior to award. 

• For Science and Technology accounts, provide the USD(AT&L) and the Assistant Secretary 

of Defense (Research & Engineering) with an assessment of the impact that budgetary 

uncertainty may have on meeting Departmental research priorities. 

*Approvals will be granted by Component heads or by senior officials designated by the 

Component head. 

Components with personnel serving Combatant Commanders (COCOMs) must consult with the 

COCOMs before implementing actions that affect them. Disputes will be brought to the attention 

of the Chairman of the Joint Chiefs of Staff for further resolution. 

Components receiving reimbursements should coordinate with customer before taking actions that 

would affect the customer's mission. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 299
Table 2. Information to Be Included in Draft Implementation Plans 

The following information should be provided at the Component level. Information by commands 

and bases/installations is not required. 

• For operating accounts, identify major actions to include, at a minimum: 

o Extent of civilian hiring freezes; expected number of temps/terms released; expected 

number, duration, and nature of furloughs. 

o Reductions in flying hours, steaming days, vehicle miles, and other 

operations/training/support activities that affect force readiness. 

o Areas of budgets experiencing disproportionate cuts. 

• For investment accounts: 

o Plans for large programs (ACAT ID and IC, and MAIS programs). 

• Include major changes in unit buys, delays, etc. 

o Significant changes in all joint programs. 

• Identify and prioritize any essential reprogramming actions with offsets. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 300
H. R. 8 

One Hundred Twelfth Congress 

of the 

United States of America 

AT THE SECOND SESSION 

Begun and held at the City of Washington on Tuesday, 

the third day of January, two thousand and twelve 

An Act 

Entitled the ‘‘American Taxpayer Relief Act of 2012’’. 

Be it enacted by the Senate and House of Representatives of 

the United States of America in Congress assembled, 

SECTION 1. SHORT TITLE, ETC. 

(a) SHORT TITLE.—This Act may be cited as the ‘‘American 

Taxpayer Relief Act of 2012’’. 

(b) AMENDMENT OF 1986 CODE.—Except as otherwise expressly 

provided, whenever in this Act an amendment or repeal is expressed 

in terms of an amendment to, or repeal of, a section or other 

provision, the reference shall be considered to be made to a section 

or other provision of the Internal Revenue Code of 1986. 

(c) TABLE OF CONTENTS.—The table of contents for this Act 

is as follows: 

Sec. 1. Short title, etc. 

TITLE I—GENERAL EXTENSIONS 

Sec. 101. Permanent extension and modification of 2001 tax relief. 

Sec. 102. Permanent extension and modification of 2003 tax relief. 

Sec. 103. Extension of 2009 tax relief. 

Sec. 104. Permanent alternative minimum tax relief. 

TITLE II—INDIVIDUAL TAX EXTENDERS 

Sec. 201. Extension of deduction for certain expenses of elementary and secondary 

school teachers. 

Sec. 202. Extension of exclusion from gross income of discharge of qualified principal residence indebtedness. 

Sec. 203. Extension of parity for exclusion from income for employer-provided mass 

transit and parking benefits. 

Sec. 204. Extension of mortgage insurance premiums treated as qualified residence 

interest. 

Sec. 205. Extension of deduction of State and local general sales taxes. 

Sec. 206. Extension of special rule for contributions of capital gain real property 

made for conservation purposes. 

Sec. 207. Extension of above-the-line deduction for qualified tuition and related expenses. 

Sec. 208. Extension of tax-free distributions from individual retirement plans for 

charitable purposes. 

Sec. 209. Improve and make permanent the provision authorizing the Internal Revenue Service to disclose certain return and return information to certain 

prison officials. 

TITLE III—BUSINESS TAX EXTENDERS 

Sec. 301. Extension and modification of research credit. 

Sec. 302. Extension of temporary minimum low-income tax credit rate for non-federally subsidized new buildings. 

Sec. 303. Extension of housing allowance exclusion for determining area median 

gross income for qualified residential rental project exempt facility 

bonds. 

Sec. 304. Extension of Indian employment tax credit. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 301
H. R. 8—2 

Sec. 305. Extension of new markets tax credit. 

Sec. 306. Extension of railroad track maintenance credit. 

Sec. 307. Extension of mine rescue team training credit. 

Sec. 308. Extension of employer wage credit for employees who are active duty 

members of the uniformed services. 

Sec. 309. Extension of work opportunity tax credit. 

Sec. 310. Extension of qualified zone academy bonds. 

Sec. 311. Extension of 15-year straight-line cost recovery for qualified leasehold improvements, qualified restaurant buildings and improvements, and 

qualified retail improvements. Sec. 312. Extension of 7-year recovery period for motorsports entertainment complexes. Sec. 313. Extension of accelerated depreciation for business property on an Indian 

reservation. 

Sec. 314. Extension of enhanced charitable deduction for contributions of food inventory. Sec. 315. Extension of increased expensing limitations and treatment of certain 

real property as section 179 property. Sec. 316. Extension of election to expense mine safety equipment. 

Sec. 317. Extension of special expensing rules for certain film and television productions. 

Sec. 318. Extension of deduction allowable with respect to income attributable to 

domestic production activities in Puerto Rico. Sec. 319. Extension of modification of tax treatment of certain payments to controlling exempt organizations. Sec. 320. Extension of treatment of certain dividends of regulated investment companies. Sec. 321. Extension of RIC qualified investment entity treatment under FIRPTA. 

Sec. 322. Extension of subpart F exception for active financing income. 

Sec. 323. Extension of look-thru treatment of payments between related controlled 

foreign corporations under foreign personal holding company rules. Sec. 324. Extension of temporary exclusion of 100 percent of gain on certain small 

business stock. 

Sec. 325. Extension of basis adjustment to stock of S corporations making charitable contributions of property. Sec. 326. Extension of reduction in S-corporation recognition period for built-in 

gains tax. Sec. 327. Extension of empowerment zone tax incentives. 

Sec. 328. Extension of tax-exempt financing for New York Liberty Zone. 

Sec. 329. Extension of temporary increase in limit on cover over of rum excise taxes 

to Puerto Rico and the Virgin Islands. Sec. 330. Modification and extension of American Samoa economic development 

credit. 

Sec. 331. Extension and modification of bonus depreciation. 

TITLE IV—ENERGY TAX EXTENDERS 

Sec. 401. Extension of credit for energy-efficient existing homes. 

Sec. 402. Extension of credit for alternative fuel vehicle refueling property. 

Sec. 403. Extension of credit for 2- or 3-wheeled plug-in electric vehicles. 

Sec. 404. Extension and modification of cellulosic biofuel producer credit. 

Sec. 405. Extension of incentives for biodiesel and renewable diesel. 

Sec. 406. Extension of production credit for Indian coal facilities placed in service 

before 2009. 

Sec. 407. Extension and modification of credits with respect to facilities producing 

energy from certain renewable resources. Sec. 408. Extension of credit for energy-efficient new homes. 

Sec. 409. Extension of credit for energy-efficient appliances. 

Sec. 410. Extension and modification of special allowance for cellulosic biofuel plant 

property. Sec. 411. Extension of special rule for sales or dispositions to implement FERC or 

State electric restructuring policy for qualified electric utilities. Sec. 412. Extension of alternative fuels excise tax credits. 

TITLE V—UNEMPLOYMENT 

Sec. 501. Extension of emergency unemployment compensation program. 

Sec. 502. Temporary extension of extended benefit provisions. 

Sec. 503. Extension of funding for reemployment services and reemployment and 

eligibility assessment activities. Sec. 504. Additional extended unemployment benefits under the Railroad Unemployment Insurance Act. 

TITLE VI—MEDICARE AND OTHER HEALTH EXTENSIONS 

Subtitle A—Medicare Extensions 

Sec. 601. Medicare physician payment update. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 302
H. R. 8—3 

Sec. 602. Work geographic adjustment. 

Sec. 603. Payment for outpatient therapy services. 

Sec. 604. Ambulance add-on payments. 

Sec. 605. Extension of Medicare inpatient hospital payment adjustment for low-volume hospitals. Sec. 606. Extension of the Medicare-dependent hospital (MDH) program. 

Sec. 607. Extension for specialized Medicare Advantage plans for special needs individuals. 

Sec. 608. Extension of Medicare reasonable cost contracts. 

Sec. 609. Performance improvement. 

Sec. 610. Extension of funding outreach and assistance for low-income programs. 

Subtitle B—Other Health Extensions 

Sec. 621. Extension of the qualifying individual (QI) program. 

Sec. 622. Extension of Transitional Medical Assistance (TMA). 

Sec. 623. Extension of Medicaid and CHIP Express Lane option. 

Sec. 624. Extension of family-to-family health information centers. 

Sec. 625. Extension of Special Diabetes Program for Type I diabetes and for Indians. 

Subtitle C—Other Health Provisions 

Sec. 631. IPPS documentation and coding adjustment for implementation of MSDRGs. 

Sec. 632. Revisions to the Medicare ESRD bundled payment system to reflect findings in the GAO report. Sec. 633. Treatment of multiple service payment policies for therapy services. 

Sec. 634. Payment for certain radiology services furnished under the Medicare hospital outpatient department prospective payment system. Sec. 635. Adjustment of equipment utilization rate for advanced imaging services. 

Sec. 636. Medicare payment of competitive prices for diabetic supplies and elimination of overpayment for diabetic supplies. Sec. 637. Medicare payment adjustment for non-emergency ambulance transports 

for ESRD beneficiaries. 

Sec. 638. Removing obstacles to collection of overpayments. 

Sec. 639. Medicare advantage coding intensity adjustment. 

Sec. 640. Elimination of all funding for the Medicare Improvement Fund. 

Sec. 641. Rebasing of State DSH allotments. 

Sec. 642. Repeal of CLASS program. 

Sec. 643. Commission on Long-Term Care. 

Sec. 644. Consumer Operated and Oriented Plan program contingency fund. 

TITLE VII—EXTENSION OF AGRICULTURAL PROGRAMS 

Sec. 701. 1-year extension of agricultural programs. 

Sec. 702. Supplemental agricultural disaster assistance. 

TITLE VIII—MISCELLANEOUS PROVISIONS 

Sec. 801. Strategic delivery systems. 

Sec. 802. No cost of living adjustment in pay of members of congress. 

TITLE IX—BUDGET PROVISIONS 

Subtitle A—Modifications of Sequestration 

Sec. 901. Treatment of sequester. 

Sec. 902. Amounts in applicable retirement plans may be transferred to designated 

Roth accounts without distribution. 

Subtitle B—Budgetary Effects 

Sec. 911. Budgetary effects. 

TITLE I—GENERAL EXTENSIONS 

SEC. 101. PERMANENT EXTENSION AND MODIFICATION OF 2001 TAX 

RELIEF. 

(a) PERMANENT EXTENSION.— (1) IN GENERAL.—The Economic Growth and Tax Relief 

Reconciliation Act of 2001 is amended by striking title IX. 

(2) CONFORMING AMENDMENT.—The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 

is amended by striking section 304. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 303
H. R. 8—4 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to taxable, plan, or limitation years beginning after December 31, 2012, and estates of decedents dying, 

gifts made, or generation skipping transfers after December 

31, 2012. 

(b) APPLICATION OF INCOME TAX TO CERTAIN HIGH-INCOME

TAXPAYERS.— 

(1) INCOME TAX RATES.— 

(A) TREATMENT OF 25-, 28-, AND 33-PERCENT RATE

BRACKETS.—Paragraph (2) of section 1(i) is amended to 

read as follows: 

‘‘(2) 25-, 28-, AND 33-PERCENT RATE BRACKETS.—The tables 

under subsections (a), (b), (c), (d), and (e) shall be applied— 

‘‘(A) by substituting ‘25%’ for ‘28%’ each place it 

appears (before the application of subparagraph (B)), 

‘‘(B) by substituting ‘28%’ for ‘31%’ each place it 

appears, and 

‘‘(C) by substituting ‘33%’ for ‘36%’ each place it 

appears.’’. 

(B) 35-PERCENT RATE BRACKET.—Subsection (i) of section 1 is amended by redesignating paragraph (3) as paragraph (4) and by inserting after paragraph (2) the following 

new paragraph: 

‘‘(3) MODIFICATIONS TO INCOME TAX BRACKETS FOR HIGHINCOME TAXPAYERS.— 

‘‘(A) 35-PERCENT RATE BRACKET.—In the case of taxable 

years beginning after December 31, 2012— 

‘‘(i) the rate of tax under subsections (a), (b), (c), 

and (d) on a taxpayer’s taxable income in the highest 

rate bracket shall be 35 percent to the extent such 

income does not exceed an amount equal to the excess 

of— 

‘‘(I) the applicable threshold, over 

‘‘(II) the dollar amount at which such bracket 

begins, and 

‘‘(ii) the 39.6 percent rate of tax under such subsections shall apply only to the taxpayer’s taxable 

income in such bracket in excess of the amount to 

which clause (i) applies. 

‘‘(B) APPLICABLE THRESHOLD.—For purposes of this 

paragraph, the term ‘applicable threshold’ means— 

‘‘(i) $450,000 in the case of subsection (a), 

‘‘(ii) $425,000 in the case of subsection (b), 

‘‘(iii) $400,000 in the case of subsection (c), and 

‘‘(iv) 1⁄2 the amount applicable under clause (i) 

(after adjustment, if any, under subparagraph (C)) in 

the case of subsection (d). 

‘‘(C) INFLATION ADJUSTMENT.—For purposes of this 

paragraph, with respect to taxable years beginning in calendar years after 2013, each of the dollar amounts under 

clauses (i), (ii), and (iii) of subparagraph (B) shall be 

adjusted in the same manner as under paragraph (1)(C)(i), 

except that subsection (f)(3)(B) shall be applied by substituting ‘2012’ for ‘1992’.’’. 

(2) PHASEOUT OF PERSONAL EXEMPTIONS AND ITEMIZED

DEDUCTIONS.— 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 304
H. R. 8—5 

(A) OVERALL LIMITATION ON ITEMIZED DEDUCTIONS.— 

Section 68 is amended— 

(i) by striking subsection (b) and inserting the 

following: 

‘‘(b) APPLICABLE AMOUNT.— 

‘‘(1) IN GENERAL.—For purposes of this section, the term 

‘applicable amount’ means— 

‘‘(A) $300,000 in the case of a joint return or a surviving 

spouse (as defined in section 2(a)), 

‘‘(B) $275,000 in the case of a head of household (as 

defined in section 2(b)), 

‘‘(C) $250,000 in the case of an individual who is not 

married and who is not a surviving spouse or head of 

household, and 

‘‘(D) 1⁄2 the amount applicable under subparagraph 

(A) (after adjustment, if any, under paragraph (2)) in the 

case of a married individual filing a separate return. 

For purposes of this paragraph, marital status shall be determined under section 7703. 

‘‘(2) INFLATION ADJUSTMENT.—In the case of any taxable 

year beginning in calendar years after 2013, each of the dollar 

amounts under subparagraphs (A), (B), and (C) of paragraph 

(1) shall be shall be increased by an amount equal to— 

‘‘(A) such dollar amount, multiplied by 

‘‘(B) the cost-of-living adjustment determined under 

section 1(f)(3) for the calendar year in which the taxable 

year begins, except that section 1(f)(3)(B) shall be applied 

by substituting ‘2012’ for ‘1992’. 

If any amount after adjustment under the preceding sentence 

is not a multiple of $50, such amount shall be rounded to 

the next lowest multiple of $50.’’, and 

(ii) by striking subsections (f) and (g). 

(B) PHASEOUT OF DEDUCTIONS FOR PERSONAL EXEMP- TIONS.— (i) IN GENERAL.—Paragraph (3) of section 151(d) 

is amended— 

(I) by striking ‘‘the threshold amount’’ in subparagraphs (A) and (B) and inserting ‘‘the 

applicable amount in effect under section 68(b)’’, 

(II) by striking subparagraph (C) and redesignating subparagraph (D) as subparagraph (C), and 

(III) by striking subparagraphs (E) and (F). 

(ii) CONFORMING AMENDMENTS.—Paragraph (4) of 

section 151(d) is amended— 

(I) by striking subparagraph (B), 

(II) by redesignating clauses (i) and (ii) of 

subparagraph (A) as subparagraphs (A) and (B), 

respectively, and by indenting such subparagraphs 

(as so redesignated) accordingly, and 

(III) by striking all that precedes ‘‘in a calendar year after 1989,’’ and inserting the following: 

‘‘(4) INFLATION ADJUSTMENT.—In the case of any taxable 

year beginning’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to taxable years beginning after December 

31, 2012. 

(c) MODIFICATIONS OF ESTATE TAX.— 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 305
H. R. 8—6 

(1) MAXIMUM ESTATE TAX RATE EQUAL TO 40 PERCENT.— 

The table contained in subsection (c) of section 2001, as 

amended by section 302(a)(2) of the Tax Relief, Unemployment 

Insurance Reauthorization, and Job Creation Act of 2010, is 

amended by striking ‘‘Over $500,000’’ and all that follows and 

inserting the following: 

‘‘Over $500,000 but not over 

$750,000.

$155,800, plus 37 percent of the 

excess of such amount over 

$500,000. 

Over $750,000 but not over 

$1,000,000.

$248,300, plus 39 percent of the 

excess of such amount over 

$750,000. 

Over $1,000,000 .......................... $345,800, plus 40 percent of the 

excess of such amount over 

$1,000,000.’’. 

(2) TECHNICAL CORRECTION.—Clause (i) of section 

2010(c)(4)(B) is amended by striking ‘‘basic exclusion amount’’ 

and inserting ‘‘applicable exclusion amount’’. 

(3) EFFECTIVE DATES.— 

(A) IN GENERAL.—Except as otherwise provided by in 

this paragraph, the amendments made by this subsection 

shall apply to estates of decedents dying, generation-skipping transfers, and gifts made, after December 31, 2012. 

(B) TECHNICAL CORRECTION.—The amendment made 

by paragraph (2) shall take effect as if included in the 

amendments made by section 303 of the Tax Relief, 

Unemployment Insurance Reauthorization, and Job Creation Act of 2010. 

SEC. 102. PERMANENT EXTENSION AND MODIFICATION OF 2003 TAX 

RELIEF. 

(a) PERMANENT EXTENSION.—The Jobs and Growth Tax Relief 

Reconciliation Act of 2003 is amended by striking section 303. 

(b) 20-PERCENT CAPITAL GAINS RATE FOR CERTAIN HIGH

INCOME INDIVIDUALS.— 

(1) IN GENERAL.—Paragraph (1) of section 1(h) is amended 

by striking subparagraph (C), by redesignating subparagraphs 

(D) and (E) as subparagraphs (E) and (F) and by inserting 

after subparagraph (B) the following new subparagraphs: 

‘‘(C) 15 percent of the lesser of— 

‘‘(i) so much of the adjusted net capital gain (or, 

if less, taxable income) as exceeds the amount on which 

a tax is determined under subparagraph (B), or 

‘‘(ii) the excess of— 

‘‘(I) the amount of taxable income which would 

(without regard to this paragraph) be taxed at 

a rate below 39.6 percent, over 

‘‘(II) the sum of the amounts on which a tax 

is determined under subparagraphs (A) and (B), 

‘‘(D) 20 percent of the adjusted net capital gain (or, 

if less, taxable income) in excess of the sum of the amounts 

on which tax is determined under subparagraphs (B) and 

(C),’’. 

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(2) MINIMUM TAX.—Paragraph (3) of section 55(b) is 

amended by striking subparagraph (C), by redesignating 

subparagraph (D) as subparagraph (E), and by inserting after 

subparagraph (B) the following new subparagraphs: 

‘‘(C) 15 percent of the lesser of— 

‘‘(i) so much of the adjusted net capital gain (or, 

if less, taxable excess) as exceeds the amount on which 

tax is determined under subparagraph (B), or 

‘‘(ii) the excess described in section 1(h)(1)(C)(ii), 

plus 

‘‘(D) 20 percent of the adjusted net capital gain (or, 

if less, taxable excess) in excess of the sum of the amounts 

on which tax is determined under subparagraphs (B) and 

(C), plus’’. 

(c) CONFORMING AMENDMENTS.— 

(1) The following provisions are each amended by striking 

‘‘15 percent’’ and inserting ‘‘20 percent’’: 

(A) Section 531. 

(B) Section 541. 

(C) Section 1445(e)(1). 

(D) The second sentence of section 7518(g)(6)(A). 

(E) Section 53511(f)(2) of title 46, United States Code. 

(2) Sections 1(h)(1)(B) and 55(b)(3)(B) are each amended 

by striking ‘‘5 percent (0 percent in the case of taxable years 

beginning after 2007)’’ and inserting ‘‘0 percent’’. 

(3) Section 1445(e)(6) is amended by striking ‘‘15 percent 

(20 percent in the case of taxable years beginning after 

December 31, 2010)’’ and inserting ‘‘20 percent’’. 

(d) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as otherwise provided, the amendments made by subsections (b) and (c) shall apply to taxable 

years beginning after December 31, 2012. 

(2) WITHHOLDING.—The amendments made by paragraphs 

(1)(C) and (3) of subsection (c) shall apply to amounts paid 

on or after January 1, 2013. 

SEC. 103. EXTENSION OF 2009 TAX RELIEF. 

(a) 5-YEAR EXTENSION OF AMERICAN OPPORTUNITY TAX

CREDIT.— 

(1) IN GENERAL.—Section 25A(i) is amended by striking 

‘‘in 2009, 2010, 2011, or 2012’’ and inserting ‘‘after 2008 and 

before 2018’’. 

(2) TREATMENT OF POSSESSIONS.—Section 1004(c)(1) of division B of the American Recovery and Reinvestment Tax Act 

of 2009 is amended by striking ‘‘in 2009, 2010, 2011, and 

2012’’ each place it appears and inserting ‘‘after 2008 and 

before 2018’’. 

(b) 5-YEAR EXTENSION OF CHILD TAX CREDIT.—Section 24(d)(4) 

is amended— 

(1) by striking ‘‘2009, 2010, 2011, AND 2012’’ in the heading 

and inserting ‘‘FOR CERTAIN YEARS’’, and 

(2) by striking ‘‘in 2009, 2010, 2011, or 2012’’ and inserting 

‘‘after 2008 and before 2018’’. 

(c) 5-YEAR EXTENSION OF EARNED INCOME TAX CREDIT.—Section 

32(b)(3) is amended— 

(1) by striking ‘‘2009, 2010, 2011, AND 2012’’ in the heading 

and inserting ‘‘FOR CERTAIN YEARS’’, and 

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(2) by striking ‘‘in 2009, 2010, 2011, or 2012’’ and inserting 

‘‘after 2008 and before 2018’’. 

(d) PERMANENT EXTENSION OF RULE DISREGARDING REFUNDS

IN THE ADMINISTRATION OF FEDERAL PROGRAMS AND FEDERALLY

ASSISTED PROGRAMS.—Section 6409 is amended to read as follows: 

‘‘SEC. 6409. REFUNDS DISREGARDED IN THE ADMINISTRATION OF FEDERAL PROGRAMS AND FEDERALLY ASSISTED PROGRAMS. 

‘‘Notwithstanding any other provision of law, any refund (or 

advance payment with respect to a refundable credit) made to 

any individual under this title shall not be taken into account 

as income, and shall not be taken into account as resources for 

a period of 12 months from receipt, for purposes of determining 

the eligibility of such individual (or any other individual) for benefits 

or assistance (or the amount or extent of benefits or assistance) 

under any Federal program or under any State or local program 

financed in whole or in part with Federal funds.’’. 

(e) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as provided in paragraph (2), the 

amendments made by this section shall apply to taxable years 

beginning after December 31, 2012. 

(2) RULE REGARDING DISREGARD OF REFUNDS.—The amendment made by subsection (d) shall apply to amounts received 

after December 31, 2012. 

SEC. 104. PERMANENT ALTERNATIVE MINIMUM TAX RELIEF. 

(a) 2012 EXEMPTION AMOUNTS MADE PERMANENT.— (1) IN GENERAL.—Paragraph (1) of section 55(d) is 

amended— 

(A) by striking ‘‘$45,000’’ and all that follows through ‘‘2011)’’ in subparagraph (A) and inserting ‘‘$78,750’’, (B) by striking ‘‘$33,750’’ and all that follows through ‘‘2011)’’ in subparagraph (B) and inserting ‘‘$50,600’’, and 

(C) by striking ‘‘paragraph (1)(A)’’ in subparagraph (C) 

and inserting ‘‘subparagraph (A)’’. 

(b) EXEMPTION AMOUNTS INDEXED FOR INFLATION.— (1) IN GENERAL.—Subsection (d) of section 55 is amended 

by adding at the end the following new paragraph: 

‘‘(4) INFLATION ADJUSTMENT.— 

‘‘(A) IN GENERAL.—In the case of any taxable year 

beginning in a calendar year after 2012, the amounts 

described in subparagraph (B) shall each be increased by 

an amount equal to— 

‘‘(i) such dollar amount, multiplied by 

‘‘(ii) the cost-of-living adjustment determined 

under section 1(f)(3) for the calendar year in which 

the taxable year begins, determined by substituting 

‘calendar year 2011’ for ‘calendar year 1992’ in 

subparagraph (B) thereof. 

‘‘(B) AMOUNTS DESCRIBED.—The amounts described in 

this subparagraph are— 

‘‘(i) each of the dollar amounts contained in subsection (b)(1)(A)(i), 

‘‘(ii) each of the dollar amounts contained in paragraph (1), and 

‘‘(iii) each of the dollar amounts in subparagraphs 

(A) and (B) of paragraph (3). 

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‘‘(C) ROUNDING.—Any increase determined under 

subparagraph (A) shall be rounded to the nearest multiple 

of $100.’’. 

(2) CONFORMING AMENDMENTS.— 

(A) Clause (iii) of section 55(b)(1)(A) is amended by 

striking ‘‘by substituting’’ and all that follows through 

‘‘appears.’’ and inserting ‘‘by substituting 50 percent of 

the dollar amount otherwise applicable under subclause 

(I) and subclause (II) thereof.’’. 

(B) Paragraph (3) of section 55(d) is amended— 

(i) by striking ‘‘or (2)’’ in subparagraph (A), 

(ii) by striking ‘‘and’’ at the end of subparagraph 

(B), and 

(iii) by striking subparagraph (C) and inserting 

the following new subparagraphs: 

‘‘(C) 50 percent of the dollar amount applicable under 

subparagraph (A) in the case of a taxpayer described in 

subparagraph (C) or (D) of paragraph (1), and 

‘‘(D) $150,000 in the case of a taxpayer described in 

paragraph (2).’’. 

(c) ALTERNATIVE MINIMUM TAX RELIEF FOR NONREFUNDABLE

CREDITS.— 

(1) IN GENERAL.—Subsection (a) of section 26 is amended 

to read as follows: 

‘‘(a) LIMITATION BASED ON AMOUNT OF TAX.—The aggregate 

amount of credits allowed by this subpart for the taxable year 

shall not exceed the sum of— 

‘‘(1) the taxpayer’s regular tax liability for the taxable 

year reduced by the foreign tax credit allowable under section 

27(a), and 

‘‘(2) the tax imposed by section 55(a) for the taxable year.’’. 

(2) CONFORMING AMENDMENTS.— 

(A) ADOPTION CREDIT.— (i) Section 23(b) is amended by striking paragraph 

(4). 

(ii) Section 23(c) is amended by striking paragraphs (1) and (2) and inserting the following: 

‘‘(1) IN GENERAL.—If the credit allowable under subsection 

(a) for any taxable year exceeds the limitation imposed by 

section 26(a) for such taxable year reduced by the sum of 

the credits allowable under this subpart (other than this section 

and sections 25D and 1400C), such excess shall be carried 

to the succeeding taxable year and added to the credit allowable 

under subsection (a) for such taxable year.’’. 

(iii) Section 23(c) is amended by redesignating 

paragraph (3) as paragraph (2). 

(B) CHILD TAX CREDIT.— (i) Section 24(b) is amended by striking paragraph 

(3). 

(ii) Section 24(d)(1) is amended— 

(I) by striking ‘‘section 26(a)(2) or subsection 

(b)(3), as the case may be,’’ each place it appears 

in subparagraphs (A) and (B) and inserting ‘‘section 26(a)’’, and 

(II) by striking ‘‘section 26(a)(2) or subsection 

(b)(3), as the case may be’’ in the second last 

sentence and inserting ‘‘section 26(a)’’. 

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(C) CREDIT FOR INTEREST ON CERTAIN HOME MORTGAGES.—Section 25(e)(1)(C) is amended to read as follows: 

‘‘(C) APPLICABLE TAX LIMIT.—For purposes of this paragraph, the term ‘applicable tax limit’ means the limitation 

imposed by section 26(a) for the taxable year reduced by 

the sum of the credits allowable under this subpart (other 

than this section and sections 23, 25D, and 1400C).’’. 

(D) HOPE AND LIFETIME LEARNING CREDITS.—Section 

25A(i) is amended— 

(i) by striking paragraph (5) and by redesignating 

paragraphs (6) and (7) as paragraphs (5) and (6), 

respectively, and 

(ii) by striking ‘‘section 26(a)(2) or paragraph (5), 

as the case may be’’ in paragraph (5), as redesignated 

by clause (i), and inserting ‘‘section 26(a)’’. 

(E) SAVERS’ CREDIT.—Section 25B is amended by 

striking subsection (g). 

(F) RESIDENTIAL ENERGY EFFICIENT PROPERTY.—Section 

25D(c) is amended to read as follows: 

‘‘(c) CARRYFORWARD OF UNUSED CREDIT.—If the credit allowable 

under subsection (a) exceeds the limitation imposed by section 

26(a) for such taxable year reduced by the sum of the credits 

allowable under this subpart (other than this section), such excess 

shall be carried to the succeeding taxable year and added to the 

credit allowable under subsection (a) for such succeeding taxable 

year.’’. 

(G) CERTAIN PLUG-IN ELECTRIC VEHICLES.—Section 

30(c)(2) is amended to read as follows: 

‘‘(2) PERSONAL CREDIT.—For purposes of this title, the credit 

allowed under subsection (a) for any taxable year (determined 

after application of paragraph (1)) shall be treated as a credit 

allowable under subpart A for such taxable year.’’. 

(H) ALTERNATIVE MOTOR VEHICLE CREDIT.—Section 

30B(g)(2) is amended to read as follows: 

‘‘(2) PERSONAL CREDIT.—For purposes of this title, the credit 

allowed under subsection (a) for any taxable year (determined 

after application of paragraph (1)) shall be treated as a credit 

allowable under subpart A for such taxable year.’’. 

(I) NEW QUALIFIED PLUG-IN ELECTRIC VEHICLE

CREDIT.—Section 30D(c)(2) is amended to read as follows: 

‘‘(2) PERSONAL CREDIT.—For purposes of this title, the credit 

allowed under subsection (a) for any taxable year (determined 

after application of paragraph (1)) shall be treated as a credit 

allowable under subpart A for such taxable year.’’. 

(J) CROSS REFERENCES.—Section 55(c)(3) is amended 

by striking ‘‘26(a), 30C(d)(2),’’ and inserting ‘‘30C(d)(2)’’. 

(K) FOREIGN TAX CREDIT.—Section 904 is amended by 

striking subsection (i) and by redesignating subsections 

(j), (k), and (l) as subsections (i), (j), and (k), respectively. 

(L) FIRST-TIME HOME BUYER CREDIT FOR THE DISTRICT

OF COLUMBIA.—Section 1400C(d) is amended to read as 

follows: 

‘‘(d) CARRYFORWARD OF UNUSED CREDIT.—If the credit allowable 

under subsection (a) exceeds the limitation imposed by section 

26(a) for such taxable year reduced by the sum of the credits 

allowable under subpart A of part IV of subchapter A (other than 

this section and section 25D), such excess shall be carried to the 

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H. R. 8—11 

succeeding taxable year and added to the credit allowable under 

subsection (a) for such taxable year.’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

TITLE II—INDIVIDUAL TAX EXTENDERS 

SEC. 201. EXTENSION OF DEDUCTION FOR CERTAIN EXPENSES OF 

ELEMENTARY AND SECONDARY SCHOOL TEACHERS. 

(a) IN GENERAL.—Subparagraph (D) of section 62(a)(2) is 

amended by striking ‘‘or 2011’’ and inserting ‘‘2011, 2012, or 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 202. EXTENSION OF EXCLUSION FROM GROSS INCOME OF DISCHARGE OF QUALIFIED PRINCIPAL RESIDENCE INDEBTEDNESS. 

(a) IN GENERAL.—Subparagraph (E) of section 108(a)(1) is 

amended by striking ‘‘January 1, 2013’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to indebtedness discharged after December 31, 2012. 

SEC. 203. EXTENSION OF PARITY FOR EXCLUSION FROM INCOME FOR 

EMPLOYER-PROVIDED MASS TRANSIT AND PARKING 

BENEFITS. 

(a) IN GENERAL.—Paragraph (2) of section 132(f) is amended 

by striking ‘‘January 1, 2012’’ and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to months after December 31, 2011. 

SEC. 204. EXTENSION OF MORTGAGE INSURANCE PREMIUMS TREATED 

AS QUALIFIED RESIDENCE INTEREST. 

(a) IN GENERAL.—Subclause (I) of section 163(h)(3)(E)(iv) is 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

(b) TECHNICAL AMENDMENTS.—Clause (i) of section 163(h)(4)(E) 

is amended— 

(1) by striking ‘‘Veterans Administration’’ and inserting 

‘‘Department of Veterans Affairs’’, and 

(2) by striking ‘‘Rural Housing Administration’’ and 

inserting ‘‘Rural Housing Service’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to amounts paid or accrued after December 31, 2011. 

SEC. 205. EXTENSION OF DEDUCTION OF STATE AND LOCAL GENERAL 

SALES TAXES. 

(a) IN GENERAL.—Subparagraph (I) of section 164(b)(5) is 

amended by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

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SEC. 206. EXTENSION OF SPECIAL RULE FOR CONTRIBUTIONS OF CAPITAL GAIN REAL PROPERTY MADE FOR CONSERVATION 

PURPOSES. 

(a) IN GENERAL.—Clause (vi) of section 170(b)(1)(E) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) CONTRIBUTIONS BY CERTAIN CORPORATE FARMERS AND

RANCHERS.—Clause (iii) of section 170(b)(2)(B) is amended by 

striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to contributions made in taxable years beginning after 

December 31, 2011. 

SEC. 207. EXTENSION OF ABOVE-THE-LINE DEDUCTION FOR QUALIFIED TUITION AND RELATED EXPENSES. 

(a) IN GENERAL.—Subsection (e) of section 222 is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 208. EXTENSION OF TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL 

RETIREMENT PLANS FOR CHARITABLE PURPOSES. 

(a) IN GENERAL.—Subparagraph (F) of section 408(d)(8) is 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

(b) EFFECTIVE DATE; SPECIAL RULE.— (1) EFFECTIVE DATE.—The amendment made by this section 

shall apply to distributions made in taxable years beginning 

after December 31, 2011. 

(2) SPECIAL RULES.—For purposes of subsections (a)(6), 

(b)(3), and (d)(8) of section 408 of the Internal Revenue Code 

of 1986, at the election of the taxpayer (at such time and 

in such manner as prescribed by the Secretary of the 

Treasury)— 

(A) any qualified charitable distribution made after 

December 31, 2012, and before February 1, 2013, shall 

be deemed to have been made on December 31, 2012, 

and 

(B) any portion of a distribution from an individual 

retirement account to the taxpayer after November 30, 

2012, and before January 1, 2013, may be treated as a 

qualified charitable distribution to the extent that— 

(i) such portion is transferred in cash after the 

distribution to an organization described in section 

408(d)(8)(B)(i) before February 1, 2013, and 

(ii) such portion is part of a distribution that would 

meet the requirements of section 408(d)(8) but for the 

fact that the distribution was not transferred directly 

to an organization described in section 408(d)(8)(B)(i). 

SEC. 209. IMPROVE AND MAKE PERMANENT THE PROVISION AUTHORIZING THE INTERNAL REVENUE SERVICE TO DISCLOSE 

CERTAIN RETURN AND RETURN INFORMATION TO CERTAIN PRISON OFFICIALS. 

(a) IN GENERAL.—Paragraph (10) of section 6103(k) is amended 

to read as follows: 

‘‘(10) DISCLOSURE OF CERTAIN RETURNS AND RETURN

INFORMATION TO CERTAIN PRISON OFFICIALS.— 

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H. R. 8—13 

‘‘(A) IN GENERAL.—Under such procedures as the Secretary may prescribe, the Secretary may disclose to officers 

and employees of the Federal Bureau of Prisons and of 

any State agency charged with the responsibility for 

administration of prisons any returns or return information 

with respect to individuals incarcerated in Federal or State 

prison systems whom the Secretary has determined may 

have filed or facilitated the filing of a false or fraudulent 

return to the extent that the Secretary determines that 

such disclosure is necessary to permit effective Federal 

tax administration. 

‘‘(B) DISCLOSURE TO CONTRACTOR-RUN PRISONS.—Under 

such procedures as the Secretary may prescribe, the disclosures authorized by subparagraph (A) may be made to 

contractors responsible for the operation of a Federal or 

State prison on behalf of such Bureau or agency. 

‘‘(C) RESTRICTIONS ON USE OF DISCLOSED INFORMATION.—Any return or return information received under 

this paragraph shall be used only for the purposes of and 

to the extent necessary in taking administrative action 

to prevent the filing of false and fraudulent returns, 

including administrative actions to address possible violations of administrative rules and regulations of the prison 

facility and in administrative and judicial proceedings 

arising from such administrative actions. 

‘‘(D) RESTRICTIONS ON REDISCLOSURE AND DISCLOSURE

TO LEGAL REPRESENTATIVES.—Notwithstanding subsection 

(h)— 

‘‘(i) RESTRICTIONS ON REDISCLOSURE.—Except as 

provided in clause (ii), any officer, employee, or contractor of the Federal Bureau of Prisons or of any 

State agency charged with the responsibility for 

administration of prisons shall not disclose any 

information obtained under this paragraph to any person other than an officer or employee or contractor 

of such Bureau or agency personally and directly 

engaged in the administration of prison facilities on 

behalf of such Bureau or agency. 

‘‘(ii) DISCLOSURE TO LEGAL REPRESENTATIVES.—The 

returns and return information disclosed under this 

paragraph may be disclosed to the duly authorized 

legal representative of the Federal Bureau of Prisons, 

State agency, or contractor charged with the responsibility for administration of prisons, or of the incarcerated individual accused of filing the false or fraudulent 

return who is a party to an action or proceeding 

described in subparagraph (C), solely in preparation 

for, or for use in, such action or proceeding.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) Paragraph (3) of section 6103(a) is amended by inserting 

‘‘subsection (k)(10),’’ after ‘‘subsection (e)(1)(D)(iii),’’. 

(2) Paragraph (4) of section 6103(p) is amended— 

(A) by inserting ‘‘subsection (k)(10),’’ before ‘‘subsection 

(l)(10),’’ in the matter preceding subparagraph (A), 

(B) in subparagraph (F)(i)— 

(i) by inserting ‘‘(k)(10),’’ before ‘‘or (l)(6),’’, and 

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(ii) by inserting ‘‘subsection (k)(10) or’’ before ‘‘subsection (l)(10),’’, and 

(C) by inserting ‘‘subsection (k)(10) or’’ before ‘‘subsection (l)(10),’’ both places it appears in the matter following subparagraph (F)(iii). 

(3) Paragraph (2) of section 7213(a) is amended by inserting 

‘‘(k)(10),’’ before ‘‘(l)(6),’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect on the date of the enactment of this Act. 

TITLE III—BUSINESS TAX EXTENDERS 

SEC. 301. EXTENSION AND MODIFICATION OF RESEARCH CREDIT. 

(a) EXTENSION.— 

(1) IN GENERAL.—Subparagraph (B) of section 41(h)(1) is 

amended by striking ‘‘December 31, 2011’’ and inserting 

‘‘December 31, 2013’’. 

(2) CONFORMING AMENDMENT.—Subparagraph (D) of section 45C(b)(1) is amended by striking ‘‘December 31, 2011’’ 

and inserting ‘‘December 31, 2013’’. 

(b) INCLUSION OF QUALIFIED RESEARCH EXPENSES AND GROSS

RECEIPTS OF AN ACQUIRED PERSON.— (1) PARTIAL INCLUSION OF PRE-ACQUISITION QUALIFIED

RESEARCH EXPENSES AND GROSS RECEIPTS.—Subparagraph (A) 

of section 41(f)(3) is amended to read as follows: 

‘‘(A) ACQUISITIONS.— ‘‘(i) IN GENERAL.—If a person acquires the major 

portion of either a trade or business or a separate 

unit of a trade or business (hereinafter in this paragraph referred to as the ‘acquired business’) of another 

person (hereinafter in this paragraph referred to as 

the ‘predecessor’), then the amount of qualified 

research expenses paid or incurred by the acquiring 

person during the measurement period shall be 

increased by the amount determined under clause (ii), 

and the gross receipts of the acquiring person for such 

period shall be increased by the amount determined 

under clause (iii). 

‘‘(ii) AMOUNT DETERMINED WITH RESPECT TO QUALIFIED RESEARCH EXPENSES.—The amount determined 

under this clause is— 

‘‘(I) for purposes of applying this section for 

the taxable year in which such acquisition is made, 

the acquisition year amount, and 

‘‘(II) for purposes of applying this section for 

any taxable year after the taxable year in which 

such acquisition is made, the qualified research 

expenses paid or incurred by the predecessor with 

respect to the acquired business during the 

measurement period. 

‘‘(iii) AMOUNT DETERMINED WITH RESPECT TO GROSS

RECEIPTS.—The amount determined under this clause 

is the amount which would be determined under clause 

(ii) if ‘the gross receipts of’ were substituted for ‘the 

qualified research expenses paid or incurred by’ each 

place it appears in clauses (ii) and (iv). 

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‘‘(iv) ACQUISITION YEAR AMOUNT.—For purposes of 

clause (ii), the acquisition year amount is the amount 

equal to the product of— 

‘‘(I) the qualified research expenses paid or 

incurred by the predecessor with respect to the 

acquired business during the measurement period, 

and 

‘‘(II) the number of days in the period beginning on the date of the acquisition and ending 

on the last day of the taxable year in which the 

acquisition is made, 

divided by the number of days in the acquiring person’s 

taxable year. 

‘‘(v) SPECIAL RULES FOR COORDINATING TAXABLE

YEARS.—In the case of an acquiring person and a predecessor whose taxable years do not begin on the same 

date— 

‘‘(I) each reference to a taxable year in clauses 

(ii) and (iv) shall refer to the appropriate taxable 

year of the acquiring person, 

‘‘(II) the qualified research expenses paid or 

incurred by the predecessor, and the gross receipts 

of the predecessor, during each taxable year of 

the predecessor any portion of which is part of 

the measurement period shall be allocated equally 

among the days of such taxable year, 

‘‘(III) the amount of such qualified research 

expenses taken into account under clauses (ii) and 

(iv) with respect to a taxable year of the acquiring 

person shall be equal to the total of the expenses 

attributable under subclause (II) to the days occurring during such taxable year, and 

‘‘(IV) the amount of such gross receipts taken 

into account under clause (iii) with respect to a 

taxable year of the acquiring person shall be equal 

to the total of the gross receipts attributable under 

subclause (II) to the days occurring during such 

taxable year. 

‘‘(vi) MEASUREMENT PERIOD.—For purposes of this 

subparagraph, the term ‘measurement period’ means, 

with respect to the taxable year of the acquiring person 

for which the credit is determined, any period of the 

acquiring person preceding such taxable year which 

is taken into account for purposes of determining the 

credit for such year.’’. 

(2) EXPENSES AND GROSS RECEIPTS OF A PREDECESSOR.— 

Subparagraph (B) of section 41(f)(3) is amended to read as 

follows: 

‘‘(B) DISPOSITIONS.—If the predecessor furnished to the 

acquiring person such information as is necessary for the 

application of subparagraph (A), then, for purposes of 

applying this section for any taxable year ending after 

such disposition, the amount of qualified research expenses 

paid or incurred by, and the gross receipts of, the predecessor during the measurement period (as defined in 

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H. R. 8—16 

subparagraph (A)(vi), determined by substituting ‘predecessor’ for ‘acquiring person’ each place it appears) shall 

be reduced by— 

‘‘(i) in the case of the taxable year in which such 

disposition is made, an amount equal to the product 

of— 

‘‘(I) the qualified research expenses paid or 

incurred by, or gross receipts of, the predecessor 

with respect to the acquired business during the 

measurement period (as so defined and so determined), and 

‘‘(II) the number of days in the period beginning on the date of acquisition (as determined 

for purposes of subparagraph (A)(iv)(II)) and 

ending on the last day of the taxable year of the 

predecessor in which the disposition is made, 

divided by the number of days in the taxable year 

of the predecessor, and 

‘‘(ii) in the case of any taxable year ending after 

the taxable year in which such disposition is made, 

the amount described in clause (i)(I).’’. 

(c) AGGREGATION OF EXPENDITURES.—Paragraph (1) of section 

41(f) is amended— 

(1) by striking ‘‘shall be its proportionate shares of the 

qualified research expenses, basic research payments, and 

amounts paid or incurred to energy research consortiums, 

giving rise to the credit’’ in subparagraph (A)(ii) and inserting 

‘‘shall be determined on a proportionate basis to its share 

of the aggregate of the qualified research expenses, basic 

research payments, and amounts paid or incurred to energy 

research consortiums, taken into account by such controlled 

group for purposes of this section’’, and 

(2) by striking ‘‘shall be its proportionate shares of the 

qualified research expenses, basic research payments, and 

amounts paid or incurred to energy research consortiums, 

giving rise to the credit’’ in subparagraph (B)(ii) and inserting 

‘‘shall be determined on a proportionate basis to its share 

of the aggregate of the qualified research expenses, basic 

research payments, and amounts paid or incurred to energy 

research consortiums, taken into account by all such persons 

under common control for purposes of this section’’. 

(d) EFFECTIVE DATE.— 

(1) EXTENSION.—The amendments made by subsection (a) 

shall apply to amounts paid or incurred after December 31, 

2011. 

(2) MODIFICATIONS.—The amendments made by subsections 

(b) and (c) shall apply to taxable years beginning after 

December 31, 2011. 

SEC. 302. EXTENSION OF TEMPORARY MINIMUM LOW-INCOME TAX 

CREDIT RATE FOR NON-FEDERALLY SUBSIDIZED NEW 

BUILDINGS. 

(a) IN GENERAL.—Subparagraph (A) of section 42(b)(2) is 

amended by striking ‘‘and before December 31, 2013’’ and inserting 

‘‘with respect to housing credit dollar amount allocations made 

before January 1, 2014’’. 

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(b) EFFECTIVE DATE.—The amendment made by this section 

shall take effect on the date of the enactment of this Act. 

SEC. 303. EXTENSION OF HOUSING ALLOWANCE EXCLUSION FOR 

DETERMINING AREA MEDIAN GROSS INCOME FOR QUALIFIED RESIDENTIAL RENTAL PROJECT EXEMPT FACILITY 

BONDS. 

(a) IN GENERAL.—Subsection (b) of section 3005 of the Housing 

Assistance Tax Act of 2008 is amended by striking ‘‘January 1, 

2012’’ each place it appears and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall take effect as if included in the enactment of section 3005 

of the Housing Assistance Tax Act of 2008. 

SEC. 304. EXTENSION OF INDIAN EMPLOYMENT TAX CREDIT. 

(a) IN GENERAL.—Subsection (f) of section 45A is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 305. EXTENSION OF NEW MARKETS TAX CREDIT. 

(a) IN GENERAL.—Subparagraph (G) of section 45D(f)(1) is 

amended by striking ‘‘2010 and 2011’’ and inserting ‘‘2010, 2011, 

2012, and 2013’’. 

(b) CARRYOVER OF UNUSED LIMITATION.—Paragraph (3) of section 45D(f) is amended by striking ‘‘2016’’ and inserting ‘‘2018’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to calendar years beginning after December 31, 2011. 

SEC. 306. EXTENSION OF RAILROAD TRACK MAINTENANCE CREDIT. 

(a) IN GENERAL.—Subsection (f) of section 45G is amended 

by striking ‘‘January 1, 2012’’ and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to expenditures paid or incurred in taxable years beginning after December 31, 2011. 

SEC. 307. EXTENSION OF MINE RESCUE TEAM TRAINING CREDIT. 

(a) IN GENERAL.—Subsection (e) of section 45N is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 308. EXTENSION OF EMPLOYER WAGE CREDIT FOR EMPLOYEES 

WHO ARE ACTIVE DUTY MEMBERS OF THE UNIFORMED 

SERVICES. 

(a) IN GENERAL.—Subsection (f) of section 45P is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to payments made after December 31, 2011. 

SEC. 309. EXTENSION OF WORK OPPORTUNITY TAX CREDIT. 

(a) IN GENERAL.—Subparagraph (B) of section 51(c)(4) is 

amended by striking ‘‘after’’ and all that follows and inserting 

‘‘after December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to individuals who begin work for the employer after 

December 31, 2011. 

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SEC. 310. EXTENSION OF QUALIFIED ZONE ACADEMY BONDS. 

(a) IN GENERAL.—Paragraph (1) of section 54E(c) is amended 

by inserting ‘‘, 2012, and 2013’’ after ‘‘for 2011’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to obligations issued after December 31, 2011. 

SEC. 311. EXTENSION OF 15-YEAR STRAIGHT-LINE COST RECOVERY 

FOR QUALIFIED LEASEHOLD IMPROVEMENTS, QUALIFIED 

RESTAURANT BUILDINGS AND IMPROVEMENTS, AND 

QUALIFIED RETAIL IMPROVEMENTS. 

(a) IN GENERAL.—Clauses (iv), (v), and (ix) of section 

168(e)(3)(E) are each amended by striking ‘‘January 1, 2012’’ and 

inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 312. EXTENSION OF 7-YEAR RECOVERY PERIOD FOR MOTORSPORTS ENTERTAINMENT COMPLEXES. 

(a) IN GENERAL.—Subparagraph (D) of section 168(i)(15) is 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 313. EXTENSION OF ACCELERATED DEPRECIATION FOR BUSINESS 

PROPERTY ON AN INDIAN RESERVATION. 

(a) IN GENERAL.—Paragraph (8) of section 168(j) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 314. EXTENSION OF ENHANCED CHARITABLE DEDUCTION FOR 

CONTRIBUTIONS OF FOOD INVENTORY. 

(a) IN GENERAL.—Clause (iv) of section 170(e)(3)(C) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to contributions made after December 31, 2011. 

SEC. 315. EXTENSION OF INCREASED EXPENSING LIMITATIONS AND 

TREATMENT OF CERTAIN REAL PROPERTY AS SECTION 

179 PROPERTY. 

(a) IN GENERAL.— 

(1) DOLLAR LIMITATION.—Section 179(b)(1) is amended— 

(A) by striking ‘‘2010 or 2011,’’ in subparagraph (B) 

and inserting ‘‘2010, 2011, 2012, or 2013, and’’, 

(B) by striking subparagraph (C), 

(C) by redesignating subparagraph (D) as subparagraph (C), and 

(D) in subparagraph (C), as so redesignated, by striking 

‘‘2012’’ and inserting ‘‘2013’’. 

(2) REDUCTION IN LIMITATION.—Section 179(b)(2) is 

amended— 

(A) by striking ‘‘2010 or 2011,’’ in subparagraph (B) 

and inserting ‘‘2010, 2011, 2012, or 2013, and’’, 

(B) by striking subparagraph (C), 

(C) by redesignating subparagraph (D) as subparagraph (C), and 

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(D) in subparagraph (C), as so redesignated, by striking 

‘‘2012’’ and inserting ‘‘2013’’. 

(3) CONFORMING AMENDMENT.—Subsection (b) of section 

179 is amended by striking paragraph (6). 

(b) COMPUTER SOFTWARE.—Section 179(d)(1)(A)(ii) is amended 

by striking ‘‘2013’’ and inserting ‘‘2014’’. 

(c) ELECTION.—Section 179(c)(2) is amended by striking ‘‘2013’’ 

and inserting ‘‘2014’’. 

(d) SPECIAL RULES FOR TREATMENT OF QUALIFIED REAL PROP- ERTY.— (1) IN GENERAL.—Section 179(f)(1) is amended by striking 

‘‘2010 or 2011’’ and inserting ‘‘2010, 2011, 2012, or 2013’’. 

(2) CARRYOVER LIMITATION.— 

(A) IN GENERAL.—Section 179(f)(4) is amended by 

striking ‘‘2011’’ each place it appears and inserting ‘‘2013’’. 

(B) CONFORMING AMENDMENT.—Subparagraph (C) of 

section 179(f)(4) is amended— 

(i) in the heading, by striking ‘‘2010’’ and inserting 

‘‘2010, 2011 AND 2012’’, and 

(ii) by adding at the end the following: ‘‘For the 

last taxable year beginning in 2013, the amount determined under subsection (b)(3)(A) for such taxable year 

shall be determined without regard to this paragraph.’’. 

(e) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 316. EXTENSION OF ELECTION TO EXPENSE MINE SAFETY EQUIPMENT. 

(a) IN GENERAL.—Subsection (g) of section 179E is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 317. EXTENSION OF SPECIAL EXPENSING RULES FOR CERTAIN 

FILM AND TELEVISION PRODUCTIONS. 

(a) IN GENERAL.—Subsection (f) of section 181 is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to productions commencing after December 31, 2011. 

SEC. 318. EXTENSION OF DEDUCTION ALLOWABLE WITH RESPECT TO 

INCOME ATTRIBUTABLE TO DOMESTIC PRODUCTION 

ACTIVITIES IN PUERTO RICO. 

(a) IN GENERAL.—Subparagraph (C) of section 199(d)(8) is 

amended— 

(1) by striking ‘‘first 6 taxable years’’ and inserting ‘‘first 

8 taxable years’’, and 

(2) by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 319. EXTENSION OF MODIFICATION OF TAX TREATMENT OF CERTAIN PAYMENTS TO CONTROLLING EXEMPT ORGANIZATIONS. 

(a) IN GENERAL.—Clause (iv) of section 512(b)(13)(E) is 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

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(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to payments received or accrued after December 31, 

2011. 

SEC. 320. EXTENSION OF TREATMENT OF CERTAIN DIVIDENDS OF 

REGULATED INVESTMENT COMPANIES. 

(a) IN GENERAL.—Paragraphs (1)(C)(v) and (2)(C)(v) of section 

871(k) are each amended by striking ‘‘December 31, 2011’’ and 

inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 321. EXTENSION OF RIC QUALIFIED INVESTMENT ENTITY TREATMENT UNDER FIRPTA. 

(a) IN GENERAL.—Clause (ii) of section 897(h)(4)(A) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.— 

(1) IN GENERAL.—The amendment made by subsection (a) 

shall take effect on January 1, 2012. Notwithstanding the preceding sentence, such amendment shall not apply with respect 

to the withholding requirement under section 1445 of the 

Internal Revenue Code of 1986 for any payment made before 

the date of the enactment of this Act. 

(2) AMOUNTS WITHHELD ON OR BEFORE DATE OF ENACTMENT.—In the case of a regulated investment company— 

(A) which makes a distribution after December 31, 

2011, and before the date of the enactment of this Act; 

and 

(B) which would (but for the second sentence of paragraph (1)) have been required to withhold with respect 

to such distribution under section 1445 of such Code, 

such investment company shall not be liable to any person 

to whom such distribution was made for any amount so withheld and paid over to the Secretary of the Treasury. 

SEC. 322. EXTENSION OF SUBPART F EXCEPTION FOR ACTIVE 

FINANCING INCOME. 

(a) EXEMPT INSURANCE INCOME.—Paragraph (10) of section 

953(e) is amended— 

(1) by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’, and 

(2) by striking ‘‘December 31, 2011’’ and inserting 

‘‘December 31, 2013’’. 

(b) SPECIAL RULE FOR INCOME DERIVED IN THE ACTIVE CONDUCT

OF BANKING, FINANCING, OR SIMILAR BUSINESSES.—Paragraph (9) 

of section 954(h) is amended by striking ‘‘January 1, 2012’’ and 

inserting ‘‘January 1, 2014’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years of foreign corporations beginning after 

December 31, 2011, and to taxable years of United States shareholders with or within which any such taxable year of such foreign 

corporation ends. 

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SEC. 323. EXTENSION OF LOOK-THRU TREATMENT OF PAYMENTS 

BETWEEN RELATED CONTROLLED FOREIGN CORPORATIONS UNDER FOREIGN PERSONAL HOLDING COMPANY 

RULES. 

(a) IN GENERAL.—Subparagraph (C) of section 954(c)(6) is 

amended by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years of foreign corporations beginning after 

December 31, 2011, and to taxable years of United States shareholders with or within which such taxable years of foreign corporations end. 

SEC. 324. EXTENSION OF TEMPORARY EXCLUSION OF 100 PERCENT 

OF GAIN ON CERTAIN SMALL BUSINESS STOCK. 

(a) IN GENERAL.—Paragraph (4) of section 1202(a) is amended— 

(1) by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’, and 

(2) by striking ‘‘AND 2011’’ and inserting ‘‘, 2011, 2012, 

AND 2013’’ in the heading thereof. 

(b) TECHNICAL AMENDMENTS.— 

(1) SPECIAL RULE FOR 2009 AND CERTAIN PERIOD IN 2010.— 

Paragraph (3) of section 1202(a) is amended by adding at the 

end the following new flush sentence: 

‘‘In the case of any stock which would be described in the 

preceding sentence (but for this sentence), the acquisition date 

for purposes of this subsection shall be the first day on which 

such stock was held by the taxpayer determined after the 

application of section 1223.’’. 

(2) 100 PERCENT EXCLUSION.—Paragraph (4) of section 

1202(a) is amended by adding at the end the following new 

flush sentence: 

‘‘In the case of any stock which would be described in the 

preceding sentence (but for this sentence), the acquisition date 

for purposes of this subsection shall be the first day on which 

such stock was held by the taxpayer determined after the 

application of section 1223.’’. 

(c) EFFECTIVE DATES.— 

(1) IN GENERAL.—The amendments made by subsection 

(a) shall apply to stock acquired after December 31, 2011. 

(2) SUBSECTION (b)(1).—The amendment made by subsection (b)(1) shall take effect as if included in section 1241(a) 

of division B of the American Recovery and Reinvestment Act 

of 2009. 

(3) SUBSECTION (b)(2).—The amendment made by subsection (b)(2) shall take effect as if included in section 2011(a) 

of the Creating Small Business Jobs Act of 2010. 

SEC. 325. EXTENSION OF BASIS ADJUSTMENT TO STOCK OF S CORPORATIONS MAKING CHARITABLE CONTRIBUTIONS OF 

PROPERTY. 

(a) IN GENERAL.—Paragraph (2) of section 1367(a) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to contributions made in taxable years beginning after 

December 31, 2011. 

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SEC. 326. EXTENSION OF REDUCTION IN S-CORPORATION RECOGNITION PERIOD FOR BUILT-IN GAINS TAX. 

(a) IN GENERAL.—Paragraph (7) of section 1374(d) is amended— 

(1) by redesignating subparagraph (C) as subparagraph 

(D), and 

(2) by inserting after subparagraph (B) the following new 

subparagraph: 

‘‘(C) SPECIAL RULE FOR 2012 AND 2013.—For purposes 

of determining the net recognized built-in gain for taxable 

years beginning in 2012 or 2013, subparagraphs (A) and 

(D) shall be applied by substituting ‘5-year’ for ‘10-year’.’’, 

and 

(3) by adding at the end the following new subparagraph: 

‘‘(E) INSTALLMENT SALES.—If an S corporation sells 

an asset and reports the income from the sale using the 

installment method under section 453, the treatment of 

all payments received shall be governed by the provisions 

of this paragraph applicable to the taxable year in which 

such sale was made.’’. 

(b) TECHNICAL AMENDMENT.—Subparagraph (B) of section 

1374(d)(2) is amended by inserting ‘‘described in subparagraph (A)’’ 

after ‘‘, for any taxable year’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 327. EXTENSION OF EMPOWERMENT ZONE TAX INCENTIVES. 

(a) IN GENERAL.—Clause (i) of section 1391(d)(1)(A) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) INCREASED EXCLUSION OF GAIN ON STOCK OF EMPOWERMENT

ZONE BUSINESSES.—Subparagraph (C) of section 1202(a)(2) is 

amended— 

(1) by striking ‘‘December 31, 2016’’ and inserting 

‘‘December 31, 2018’’; and 

(2) by striking ‘‘2016’’ in the heading and inserting ‘‘2018’’. 

(c) TREATMENT OF CERTAIN TERMINATION DATES SPECIFIED IN

NOMINATIONS.—In the case of a designation of an empowerment 

zone the nomination for which included a termination date which 

is contemporaneous with the date specified in subparagraph (A)(i) 

of section 1391(d)(1) of the Internal Revenue Code of 1986 (as 

in effect before the enactment of this Act), subparagraph (B) of 

such section shall not apply with respect to such designation if, 

after the date of the enactment of this section, the entity which 

made such nomination amends the nomination to provide for a 

new termination date in such manner as the Secretary of the 

Treasury (or the Secretary’s designee) may provide. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to periods after December 31, 2011. 

SEC. 328. EXTENSION OF TAX-EXEMPT FINANCING FOR NEW YORK LIBERTY ZONE. 

(a) IN GENERAL.—Subparagraph (D) of section 1400L(d)(2) is 

amended by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to bonds issued after December 31, 2011. 

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SEC. 329. EXTENSION OF TEMPORARY INCREASE IN LIMIT ON COVER 

OVER OF RUM EXCISE TAXES TO PUERTO RICO AND THE 

VIRGIN ISLANDS. 

(a) IN GENERAL.—Paragraph (1) of section 7652(f) is amended 

by striking ‘‘January 1, 2012’’ and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to distilled spirits brought into the United States after 

December 31, 2011. 

SEC. 330. MODIFICATION AND EXTENSION OF AMERICAN SAMOA ECONOMIC DEVELOPMENT CREDIT. 

(a) MODIFICATION.— 

(1) IN GENERAL.—Subsection (a) of section 119 of division 

A of the Tax Relief and Health Care Act of 2006 is amended 

by striking ‘‘if such corporation’’ and all that follows and 

inserting ‘‘if— 

‘‘(1) in the case of a taxable year beginning before January 

1, 2012, such corporation— 

‘‘(A) is an existing credit claimant with respect to American Samoa, and 

‘‘(B) elected the application of section 936 of the 

Internal Revenue Code of 1986 for its last taxable year 

beginning before January 1, 2006, and 

‘‘(2) in the case of a taxable year beginning after December 

31, 2011, such corporation meets the requirements of subsection 

(e).’’. 

(2) REQUIREMENTS.—Section 119 of division A of such Act 

is amended by adding at the end the following new subsection: 

‘‘(e) QUALIFIED PRODUCTION ACTIVITIES INCOME REQUIREMENT.—A corporation meets the requirement of this subsection 

if such corporation has qualified production activities income, as 

defined in subsection (c) of section 199 of the Internal Revenue 

Code of 1986, determined by substituting ‘American Samoa’ for 

‘the United States’ each place it appears in paragraphs (3), (4), 

and (6) of such subsection (c), for the taxable year.’’. 

(b) EXTENSION.—Subsection (d) of section 119 of division A 

of the Tax Relief and Health Care Act of 2006 is amended by 

striking ‘‘shall apply’’ and all that follows and inserting ‘‘shall 

apply— 

‘‘(1) in the case of a corporation that meets the requirements of subparagraphs (A) and (B) of subsection (a)(1), to 

the first 8 taxable years of such corporation which begin after 

December 31, 2006, and before January 1, 2014, and 

‘‘(2) in the case of a corporation that does not meet the 

requirements of subparagraphs (A) and (B) of subsection (a)(1), 

to the first 2 taxable years of such corporation which begin 

after December 31, 2011, and before January 1, 2014.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 331. EXTENSION AND MODIFICATION OF BONUS DEPRECIATION. 

(a) IN GENERAL.—Paragraph (2) of section 168(k) is amended— 

(1) by striking ‘‘January 1, 2014’’ in subparagraph (A)(iv) 

and inserting ‘‘January 1, 2015’’, and 

(2) by striking ‘‘January 1, 2013’’ each place it appears 

and inserting ‘‘January 1, 2014’’. 

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(b) SPECIAL RULE FOR FEDERAL LONG-TERM CONTRACTS.— 

Clause (ii) of section 460(c)(6)(B) is amended by inserting ‘‘, or 

after December 31, 2012, and before January 1, 2014 (January 

1, 2015, in the case of property described in section 168(k)(2)(B))’’ 

before the period. 

(c) EXTENSION OF ELECTION TO ACCELERATE THE AMT CREDIT

IN LIEU OF BONUS DEPRECIATION.— 

(1) IN GENERAL.—Subclause (II) of section 168(k)(4)(D)(iii) 

is amended by striking ‘‘2013’’ and inserting ‘‘2014’’. 

(2) ROUND 3 EXTENSION PROPERTY.—Paragraph (4) of section 168(k) is amended by adding at the end the following 

new subparagraph: 

‘‘(J) SPECIAL RULES FOR ROUND 3 EXTENSION PROPERTY.— 

‘‘(i) IN GENERAL.—In the case of round 3 extension 

property, this paragraph shall be applied without 

regard to— 

‘‘(I) the limitation described in subparagraph 

(B)(i) thereof, and 

‘‘(II) the business credit increase amount 

under subparagraph (E)(iii) thereof. 

‘‘(ii) TAXPAYERS PREVIOUSLY ELECTING ACCELERATION.—In the case of a taxpayer who made the election 

under subparagraph (A) for its first taxable year ending 

after March 31, 2008, a taxpayer who made the election 

under subparagraph (H)(ii) for its first taxable year 

ending after December 31, 2008, or a taxpayer who 

made the election under subparagraph (I)(iii) for its 

first taxable year ending after December 31, 2010— 

‘‘(I) the taxpayer may elect not to have this 

paragraph apply to round 3 extension property, 

but 

‘‘(II) if the taxpayer does not make the election 

under subclause (I), in applying this paragraph 

to the taxpayer the bonus depreciation amount, 

maximum amount, and maximum increase amount 

shall be computed and applied to eligible qualified 

property which is round 3 extension property. 

The amounts described in subclause (II) shall be computed separately from any amounts computed with 

respect to eligible qualified property which is not round 

3 extension property. 

‘‘(iii) TAXPAYERS NOT PREVIOUSLY ELECTING ACCELERATION.—In the case of a taxpayer who neither made 

the election under subparagraph (A) for its first taxable 

year ending after March 31, 2008, nor made the election under subparagraph (H)(ii) for its first taxable 

year ending after December 31, 2008, nor made the 

election under subparagraph (I)(iii) for any taxable 

year ending after December 31, 2010— 

‘‘(I) the taxpayer may elect to have this paragraph apply to its first taxable year ending after 

December 31, 2012, and each subsequent taxable 

year, and 

‘‘(II) if the taxpayer makes the election under 

subclause (I), this paragraph shall only apply to 

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eligible qualified property which is round 3 extension property. 

‘‘(iv) ROUND 3 EXTENSION PROPERTY.—For purposes 

of this subparagraph, the term ‘round 3 extension property’ means property which is eligible qualified property solely by reason of the extension of the application 

of the special allowance under paragraph (1) pursuant 

to the amendments made by section 331(a) of the American Taxpayer Relief Act of 2012 (and the application 

of such extension to this paragraph pursuant to the 

amendment made by section 331(c)(1) of such Act).’’. 

(d) NORMALIZATION RULES AMENDMENT.—Clause (ii) of section 

168(i)(9)(A) is amended by inserting ‘‘(respecting all elections made 

by the taxpayer under this section)’’ after ‘‘such property’’. 

(e) CONFORMING AMENDMENTS.— (1) The heading for subsection (k) of section 168 is amended 

by striking ‘‘JANUARY 1, 2013’’ and inserting ‘‘JANUARY 1, 2014’’. 

(2) The heading for clause (ii) of section 168(k)(2)(B) is 

amended by striking ‘‘PRE-JANUARY 1, 2013’’ and inserting ‘‘PRE- JANUARY 1, 2014’’. 

(3) Subparagraph (C) of section 168(n)(2) is amended by 

striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’. 

(4) Subparagraph (D) of section 1400L(b)(2) is amended 

by striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’. 

(5) Subparagraph (B) of section 1400N(d)(3) is amended 

by striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’. 

(f) EFFECTIVE DATE.—The amendments made by this section 

shall apply to property placed in service after December 31, 2012, 

in taxable years ending after such date. 

TITLE IV—ENERGY TAX EXTENDERS 

SEC. 401. EXTENSION OF CREDIT FOR ENERGY-EFFICIENT EXISTING 

HOMES. 

(a) IN GENERAL.—Paragraph (2) of section 25C(g) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 402. EXTENSION OF CREDIT FOR ALTERNATIVE FUEL VEHICLE 

REFUELING PROPERTY. 

(a) IN GENERAL.—Paragraph (2) of section 30C(g) is amended 

by striking ‘‘December 31, 2011.’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 403. EXTENSION OF CREDIT FOR 2- OR 3-WHEELED PLUG-IN ELECTRIC VEHICLES. 

(a) IN GENERAL.—Section 30D is amended by adding at the 

end the following new subsection: 

‘‘(g) CREDIT ALLOWED FOR 2- AND 3-WHEELED PLUG-IN ELECTRIC

VEHICLES.— 

‘‘(1) IN GENERAL.—In the case of a qualified 2- or 3-wheeled 

plug-in electric vehicle— 

‘‘(A) there shall be allowed as a credit against the 

tax imposed by this chapter for the taxable year an amount 

equal to the sum of the applicable amount with respect 

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to each such qualified 2- or 3-wheeled plug-in electric 

vehicle placed in service by the taxpayer during the taxable 

year, and 

‘‘(B) the amount of the credit allowed under subparagraph (A) shall be treated as a credit allowed under subsection (a). 

‘‘(2) APPLICABLE AMOUNT.—For purposes of paragraph (1), 

the applicable amount is an amount equal to the lesser of— 

‘‘(A) 10 percent of the cost of the qualified 2- or 3- 

wheeled plug-in electric vehicle, or 

‘‘(B) $2,500. 

‘‘(3) QUALIFIED 2- OR 3-WHEELED PLUG-IN ELECTRIC

VEHICLE.—The term ‘qualified 2- or 3-wheeled plug-in electric 

vehicle’ means any vehicle which— 

‘‘(A) has 2 or 3 wheels, 

‘‘(B) meets the requirements of subparagraphs (A), (B), 

(C), (E), and (F) of subsection (d)(1) (determined by substituting ‘2.5 kilowatt hours’ for ‘4 kilowatt hours’ in 

subparagraph (F)(i)), 

‘‘(C) is manufactured primarily for use on public 

streets, roads, and highways, 

‘‘(D) is capable of achieving a speed of 45 miles per 

hour or greater, and 

‘‘(E) is acquired after December 31, 2011, and before 

January 1, 2014.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) NO DOUBLE BENEFIT.—Paragraph (2) of section 30D(f) 

is amended— 

(A) by striking ‘‘new qualified plug-in electric drive 

motor vehicle’’ and inserting ‘‘vehicle for which a credit 

is allowable under subsection (a)’’, and 

(B) by striking ‘‘allowed under subsection (a)’’ and 

inserting ‘‘allowed under such subsection’’. 

(2) AIR QUALITY AND SAFETY STANDARDS.—Section 30D(f)(7) 

is amended by striking ‘‘motor vehicle’’ and inserting ‘‘vehicle’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to vehicles acquired after December 31, 2011. 

SEC. 404. EXTENSION AND MODIFICATION OF CELLULOSIC BIOFUEL 

PRODUCER CREDIT. 

(a) EXTENSION.— 

(1) IN GENERAL.—Subparagraph (H) of section 40(b)(6) is 

amended to read as follows: 

‘‘(H) APPLICATION OF PARAGRAPH.— 

‘‘(i) IN GENERAL.—This paragraph shall apply with 

respect to qualified cellulosic biofuel production after 

December 31, 2008, and before January 1, 2014. 

‘‘(ii) NO CARRYOVER TO CERTAIN YEARS AFTER

EXPIRATION.—If this paragraph ceases to apply for any 

period by reason of clause (i), rules similar to the 

rules of subsection (e)(2) shall apply.’’. 

(2) CONFORMING AMENDMENT.—Paragraph (2) of section 

40(e) is amended by striking ‘‘or subsection (b)(6)(H)’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall take effect as if included in section 15321(b) of 

the Heartland, Habitat, and Horticulture Act of 2008. 

(b) ALGAE TREATED AS A QUALIFIED FEEDSTOCK.— 

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(1) IN GENERAL.—Subclause (I) of section 40(b)(6)(E)(i) is 

amended to read as follows: 

‘‘(I) is derived by, or from, qualified feedstocks, 

and’’. 

(2) QUALIFIED FEEDSTOCK; SPECIAL RULES FOR ALGAE.— 

Paragraph (6) of section 40(b) is amended by redesignating 

subparagraphs (F), (G), and (H), as amended by this Act, as 

subparagraphs (H), (I), and (J), respectively, and by inserting 

after subparagraph (E) the following new subparagraphs: 

‘‘(F) QUALIFIED FEEDSTOCK.—For purposes of this paragraph, the term ‘qualified feedstock’ means— 

‘‘(i) any lignocellulosic or hemicellulosic matter 

that is available on a renewable or recurring basis, 

and 

‘‘(ii) any cultivated algae, cyanobacteria, or lemna. 

‘‘(G) SPECIAL RULES FOR ALGAE.—In the case of fuel 

which is derived by, or from, feedstock described in 

subparagraph (F)(ii) and which is sold by the taxpayer 

to another person for refining by such other person into 

a fuel which meets the requirements of subparagraph 

(E)(i)(II) and the refined fuel is not excluded under subparagraph (E)(iii)— 

‘‘(i) such sale shall be treated as described in 

subparagraph (C)(i), 

‘‘(ii) such fuel shall be treated as meeting the 

requirements of subparagraph (E)(i)(II) and as not 

being excluded under subparagraph (E)(iii) in the 

hands of such taxpayer, and 

‘‘(iii) except as provided in this subparagraph, such 

fuel (and any fuel derived from such fuel) shall not 

be taken into account under subparagraph (C) with 

respect to the taxpayer or any other person.’’. 

(3) CONFORMING AMENDMENTS.— 

(A) Section 40, as amended by paragraph (2), is 

amended— 

(i) by striking ‘‘cellulosic biofuel’’ each place it 

appears in the text thereof and inserting ‘‘second 

generation biofuel’’, 

(ii) by striking ‘‘CELLULOSIC’’ in the headings of 

subsections (b)(6), (b)(6)(E), and (d)(3)(D) and inserting 

‘‘SECOND GENERATION’’, and 

(iii) by striking ‘‘CELLULOSIC’’ in the headings of 

subsections (b)(6)(C), (b)(6)(D), (b)(6)(H), (d)(6), and 

(e)(3) and inserting ‘‘SECOND GENERATION’’. 

(B) Clause (ii) of section 40(b)(6)(E) is amended by 

striking ‘‘Such term shall not’’ and inserting ‘‘The term 

‘second generation biofuel’ shall not’’. 

(C) Paragraph (1) of section 4101(a) is amended by 

striking ‘‘cellulosic biofuel’’ and inserting ‘‘second generation biofuel’’. 

(4) EFFECTIVE DATE.—The amendments made by this subsection shall apply to fuels sold or used after the date of 

the enactment of this Act. 

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H. R. 8—28 

SEC. 405. EXTENSION OF INCENTIVES FOR BIODIESEL AND RENEWABLE DIESEL. 

(a) CREDITS FOR BIODIESEL AND RENEWABLE DIESEL USED AS

FUEL.—Subsection (g) of section 40A is amended by striking 

‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EXCISE TAX CREDITS AND OUTLAY PAYMENTS FOR BIODIESEL

AND RENEWABLE DIESEL FUEL MIXTURES.— 

(1) Paragraph (6) of section 6426(c) is amended by striking 

‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(2) Subparagraph (B) of section 6427(e)(6) is amended by 

striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 

2013’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to fuel sold or used after December 31, 2011. 

SEC. 406. EXTENSION OF PRODUCTION CREDIT FOR INDIAN COAL 

FACILITIES PLACED IN SERVICE BEFORE 2009. 

(a) IN GENERAL.—Subparagraph (A) of section 45(e)(10) is 

amended by striking ‘‘7-year period’’ each place it appears and 

inserting ‘‘8-year period’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to coal produced after December 31, 2012. 

SEC. 407. EXTENSION AND MODIFICATION OF CREDITS WITH RESPECT 

TO FACILITIES PRODUCING ENERGY FROM CERTAIN 

RENEWABLE RESOURCES. 

(a) PRODUCTION TAX CREDIT.— 

(1) EXTENSION FOR WIND FACILITIES.—Paragraph (1) of section 45(d) is amended by striking ‘‘January 1, 2013’’ and 

inserting ‘‘January 1, 2014’’. 

(2) EXCLUSION OF PAPER WHICH IS COMMONLY RECYCLED

FROM DEFINITION OF MUNICIPAL SOLID WASTE.—Section 45(c)(6) 

is amended by inserting ‘‘, except that such term does not 

include paper which is commonly recycled and which has been 

segregated from other solid waste (as so defined)’’ after ‘‘(42 

U.S.C. 6903)’’. 

(3) MODIFICATION TO DEFINITION OF QUALIFIED FACILITY.— 

(A) IN GENERAL.—The following provisions of section 

45(d), as amended by paragraph (1), are each amended 

by striking ‘‘before January 1, 2014’’ and inserting ‘‘the 

construction of which begins before January 1, 2014’’: 

(i) Paragraph (1). 

(ii) Paragraph (2)(A)(i). 

(iii) Paragraph (3)(A)(i)(I). 

(iv) Paragraph (6). 

(v) Paragraph (7). 

(vi) Paragraph (9)(B). 

(vii) Paragraph (11)(B). 

(B) CERTAIN CLOSED-LOOP BIOMASS FACILITIES.— 

Subparagraph (A) of section 45(d)(2) is amended by adding 

at the end the following new flush sentence: 

‘‘For purposes of clause (ii), a facility shall be treated 

as modified before January 1, 2014, if the construction 

of such modification begins before such date.’’. 

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(C) CERTAIN OPEN-LOOP BIOMASS FACILITIES.—Clause 

(ii) of section 45(d)(3)(A) is amended by striking ‘‘is originally placed in service’’ and inserting ‘‘the construction 

of which begins’’. 

(D) GEOTHERMAL FACILITIES.— 

(i) IN GENERAL.—Paragraph (4) of section 45(d) 

is amended by striking ‘‘and before January 1, 2014’’ 

and all that follows and inserting ‘‘and which— 

‘‘(A) in the case of a facility using solar energy, is 

placed in service before January 1, 2006, or 

‘‘(B) in the case of a facility using geothermal energy, 

the construction of which begins before January 1, 2014. 

Such term shall not include any property described in section 

48(a)(3) the basis of which is taken into account by the taxpayer 

for purposes of determining the energy credit under section 

48.’’. 

(E) INCREMENTAL HYDROPOWER PRODUCTION.—Paragraph (9) of section 45(d) is amended— 

(i) by redesignating subparagraphs (A) and (B), 

as amended by subparagraph (A), as clauses (i) and 

(ii), respectively, and by moving such clauses (as so 

redesignated) 2 ems to the right, 

(ii) by striking ‘‘In the case of a facility’’ and 

inserting the following: 

‘‘(A) IN GENERAL.—In the case of a facility’’, 

(iii) by redesignating subparagraph (C) as subparagraph (B), and 

(iv) by adding at the end the following new 

subparagraph: 

‘‘(C) SPECIAL RULE.—For purposes of subparagraph 

(A)(i), an efficiency improvement or addition to capacity 

shall be treated as placed in service before January 1, 

2014, if the construction of such improvement or addition 

begins before such date.’’. 

(b) EXTENSION OF ELECTION TO TREAT QUALIFIED FACILITIES

AS ENERGY PROPERTY.—Subparagraph (C) of section 48(a)(5) is 

amended to read as follows: 

‘‘(C) QUALIFIED INVESTMENT CREDIT FACILITY.—For 

purposes of this paragraph, the term ‘qualified investment 

credit facility’ means any facility— 

‘‘(i) which is a qualified facility (within the 

meaning of section 45) described in paragraph (1), (2), 

(3), (4), (6), (7), (9), or (11) of section 45(d), 

‘‘(ii) which is placed in service after 2008 and the 

construction of which begins before January 1, 2014, 

and 

‘‘(iii) with respect to which— 

‘‘(I) no credit has been allowed under section 

45, and 

‘‘(II) the taxpayer makes an irrevocable election to have this paragraph apply.’’. 

(c) TECHNICAL CORRECTIONS.— (1) Subparagraph (D) of section 48(a)(5) is amended— 

(A) by striking ‘‘and’’ at the end of clause (i)(II), 

(B) by striking the period at the end of clause (ii) 

and inserting a comma, and 

(C) by adding at the end the following new clauses: 

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H. R. 8—30 

‘‘(iii) which is constructed, reconstructed, erected, 

or acquired by the taxpayer, and 

‘‘(iv) the original use of which commences with 

the taxpayer.’’. 

(2) Paragraphs (1) and (2) of subsection (a) of section 1603 

of division B of the American Recovery and Reinvestment Act 

of 2009 are each amended by striking ‘‘placed in service’’ and 

inserting ‘‘originally placed in service by such person’’. 

(d) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as provided in paragraphs (2) 

and (3), the amendments made by this section shall take effect 

on the date of the enactment of this Act. 

(2) MODIFICATION TO DEFINITION OF MUNICIPAL SOLID

WASTE.—The amendments made by subsection (a)(2) shall apply 

to electricity produced and sold after the date of the enactment 

of this Act, in taxable years ending after such date. 

(3) TECHNICAL CORRECTIONS.—The amendments made by 

subsection (c) shall apply as if included in the enactment of 

the provisions of the American Recovery and Reinvestment 

Act of 2009 to which they relate. 

SEC. 408. EXTENSION OF CREDIT FOR ENERGY-EFFICIENT NEW HOMES. 

(a) IN GENERAL.—Subsection (g) of section 45L is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) ENERGY SAVINGS REQUIREMENTS.—Clause (i) of section 

45L(c)(1)(A) is amended by striking ‘‘2003 International Energy 

Conservation Code, as such Code (including supplements) is in 

effect on the date of the enactment of this section’’and inserting 

‘‘2006 International Energy Conservation Code, as such Code 

(including supplements) is in effect on January 1, 2006’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to homes acquired after December 31, 2011. 

SEC. 409. EXTENSION OF CREDIT FOR ENERGY-EFFICIENT APPLIANCES. 

(a) IN GENERAL.—Section 45M(b) is amended by striking ‘‘2011’’ 

each place it appears other than in the provisions specified in 

subsection (b) and inserting ‘‘2011, 2012, or 2013’’. 

(b) PROVISIONS SPECIFIED.—The provisions of section 45M(b) 

specified in this subsection are subparagraph (C) of paragraph 

(1) and subparagraph (E) of paragraph (2). 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to appliances produced after December 31, 2011. 

SEC. 410. EXTENSION AND MODIFICATION OF SPECIAL ALLOWANCE 

FOR CELLULOSIC BIOFUEL PLANT PROPERTY. 

(a) EXTENSION.— 

(1) IN GENERAL.—Subparagraph (D) of section 168(l)(2) is 

amended by striking ‘‘January 1, 2013’’ and inserting ‘‘January 

1, 2014’’. 

(2) EFFECTIVE DATE.—The amendment made by this subsection shall apply to property placed in service after December 

31, 2012. 

(b) ALGAE TREATED AS A QUALIFIED FEEDSTOCK FOR PURPOSES

OF BONUS DEPRECIATION FOR BIOFUEL PLANT PROPERTY.— 

(1) IN GENERAL.—Subparagraph (A) of section 168(l)(2) is 

amended by striking ‘‘solely to produce cellulosic biofuel’’ and 

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H. R. 8—31 

inserting ‘‘solely to produce second generation biofuel (as 

defined in section 40(b)(6)(E))’’. 

(2) CONFORMING AMENDMENTS.—Subsection (l) of section 

168, as amended by subsection (a), is amended— 

(A) by striking ‘‘cellulosic biofuel’’ each place it appears 

in the text thereof and inserting ‘‘second generation 

biofuel’’, 

(B) by striking paragraph (3) and redesignating paragraphs (4) through (8) as paragraphs (3) through (7), 

respectively, 

(C) by striking ‘‘CELLULOSIC’’ in the heading of such 

subsection and inserting ‘‘SECOND GENERATION’’, and 

(D) by striking ‘‘CELLULOSIC’’ in the heading of paragraph (2) and inserting ‘‘SECOND GENERATION’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to property placed in service after the date 

of the enactment of this Act. 

SEC. 411. EXTENSION OF SPECIAL RULE FOR SALES OR DISPOSITIONS 

TO IMPLEMENT FERC OR STATE ELECTRIC RESTRUCTURING POLICY FOR QUALIFIED ELECTRIC UTILITIES. 

(a) IN GENERAL.—Paragraph (3) of section 451(i) is amended 

by striking ‘‘January 1, 2012’’ and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to dispositions after December 31, 2011. 

SEC. 412. EXTENSION OF ALTERNATIVE FUELS EXCISE TAX CREDITS. 

(a) IN GENERAL.—Sections 6426(d)(5) and 6426(e)(3) are each 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

(b) OUTLAY PAYMENTS FOR ALTERNATIVE FUELS.—Paragraph 

(6) of section 6427(e) is amended— 

(1) in subparagraph (C)— 

(A) by striking ‘‘or alternative fuel mixture (as defined 

in subsection (d)(2) or (e)(3) of section 6426)’’ and inserting 

‘‘(as defined in section 6426(d)(2))’’, and 

(B) by striking ‘‘December 31, 2011, and’’ and inserting 

‘‘December 31, 2013,’’, 

(2) in subparagraph (D)— 

(A) by striking ‘‘or alternative fuel mixture’’, and 

(B) by striking the period at the end and inserting 

‘‘, and’’, and 

(3) by adding at the end the following new subparagraph: 

‘‘(E) any alternative fuel mixture (as defined in section 

6426(e)(2)) sold or used after December 31, 2011.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to fuel sold or used after December 31, 2011. 

TITLE V—UNEMPLOYMENT 

SEC. 501. EXTENSION OF EMERGENCY UNEMPLOYMENT COMPENSATION PROGRAM. 

(a) EXTENSION.—Section 4007(a)(2) of the Supplemental Appropriations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 note) 

is amended by striking ‘‘January 2, 2013’’ and inserting ‘‘January 

1, 2014’’. 

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(b) FUNDING.—Section 4004(e)(1) of the Supplemental Appropriations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 note) 

is amended— 

(1) in subparagraph (H), by striking ‘‘and’’ at the end; 

and 

(2) by inserting after subparagraph (I) the following: 

‘‘(J) the amendments made by section 501(a) of the 

American Taxpayer Relief Act of 2012;’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of the Unemployment Benefits Extension Act of 2012 (Public Law 112–96) 

SEC. 502. TEMPORARY EXTENSION OF EXTENDED BENEFIT PROVISIONS. 

(a) IN GENERAL.—Section 2005 of the Assistance for 

Unemployed Workers and Struggling Families Act, as contained 

in Public Law 111–5 (26 U.S.C. 3304 note), is amended— 

(1) by striking ‘‘December 31, 2012’’ each place it appears 

and inserting ‘‘December 31, 2013’’; and 

(2) in subsection (c), by striking ‘‘June 30, 2013’’ and 

inserting ‘‘June 30, 2014’’. 

(b) EXTENSION OF MATCHING FOR STATES WITH NO WAITING

WEEK.—Section 5 of the Unemployment Compensation Extension 

Act of 2008 (Public Law 110–449; 26 U.S.C. 3304 note) is amended 

by striking ‘‘June 30, 2013’’ and inserting ‘‘June 30, 2014’’. 

(c) EXTENSION OF MODIFICATION OF INDICATORS UNDER THE

EXTENDED BENEFIT PROGRAM.—Section 203 of the Federal-State 

Extended Unemployment Compensation Act of 1970 (26 U.S.C. 

3304 note) is amended— 

(1) in subsection (d), by striking ‘‘December 31, 2012’’ and 

inserting ‘‘December 31, 2013’’; and 

(2) in subsection (f)(2), by striking ‘‘December 31, 2012’’ 

and inserting ‘‘December 31, 2013’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of the Unemployment Benefits Extension Act of 2012 (Public Law 112–96). 

SEC. 503. EXTENSION OF FUNDING FOR REEMPLOYMENT SERVICES 

AND REEMPLOYMENT AND ELIGIBILITY ASSESSMENT 

ACTIVITIES. 

(a) IN GENERAL.—Section 4004(c)(2)(A) of the Supplemental 

Appropriations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 

note) is amended by striking ‘‘through fiscal year 2013’’ and 

inserting ‘‘through fiscal year 2014’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of the Unemployment Benefits Extension Act of 2012 (Public Law 112–96). 

SEC. 504. ADDITIONAL EXTENDED UNEMPLOYMENT BENEFITS UNDER 

THE RAILROAD UNEMPLOYMENT INSURANCE ACT. 

(a) EXTENSION.—Section 2(c)(2)(D)(iii) of the Railroad 

Unemployment Insurance Act, as added by section 2006 of the 

American Recovery and Reinvestment Act of 2009 (Public Law 

111–5) and as amended by section 9 of the Worker, Homeownership, 

and Business Assistance Act of 2009 (Public Law 111–92), section 

505 of the Tax Relief, Unemployment Insurance Reauthorization, 

and Job Creation Act of 2010 (Public Law 111–312), section 202 

of the Temporary Payroll Tax Cut Continuation Act of 2011 (Public 

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H. R. 8—33 

Law 112–78), and section 2124 of the Unemployment Benefits 

Extension Act of 2012 (Public Law 112–96), is amended— 

(1) by striking ‘‘June 30, 2012’’ and inserting ‘‘June 30, 

2013’’; and 

(2) by striking ‘‘December 31, 2012’’ and inserting 

‘‘December 31, 2013’’. 

(b) CLARIFICATION ON AUTHORITY TO USE FUNDS.—Funds 

appropriated under either the first or second sentence of clause 

(iv) of section 2(c)(2)(D) of the Railroad Unemployment Insurance 

Act shall be available to cover the cost of additional extended 

unemployment benefits provided under such section 2(c)(2)(D) by 

reason of the amendments made by subsection (a) as well as to 

cover the cost of such benefits provided under such section 

2(c)(2)(D), as in effect on the day before the date of enactment 

of this Act. 

(c) FUNDING FOR ADMINISTRATION.—Out of any funds in the 

Treasury not otherwise appropriated, there are appropriated to 

the Railroad Retirement Board $250,000 for administrative 

expenses associated with the payment of additional extended 

unemployment benefits provided under section 2(c)(2)(D) of the 

Railroad Unemployment Insurance Act by reason of the amendments made by subsection (a), to remain available until expended. 

TITLE VI—MEDICARE AND OTHER 

HEALTH EXTENSIONS 

Subtitle A—Medicare Extensions 

SEC. 601. MEDICARE PHYSICIAN PAYMENT UPDATE. 

(a) IN GENERAL.—Section 1848(d) of the Social Security Act 

(42 U.S.C. 1395w–4(d)) is amended by adding at the end the following new paragraph: 

‘‘(14) UPDATE FOR 2013.— ‘‘(A) IN GENERAL.—Subject to paragraphs (7)(B), (8)(B), 

(9)(B), (10)(B), (11)(B), (12)(B), and (13)(B), in lieu of the 

update to the single conversion factor established in paragraph (1)(C) that would otherwise apply for 2013, the 

update to the single conversion factor for such year shall 

be zero percent. 

‘‘(B) NO EFFECT ON COMPUTATION OF CONVERSION

FACTOR FOR 2014 AND SUBSEQUENT YEARS.—The conversion 

factor under this subsection shall be computed under paragraph (1)(A) for 2014 and subsequent years as if subparagraph (A) had never applied.’’. 

(b) ADVANCEMENT OF CLINICAL DATA REGISTRIES TO IMPROVE

THE QUALITY OF HEALTH CARE.— (1) IN GENERAL.—Section 1848(m)(3) of the Social Security 

Act (42 U.S.C. 1395w–4(m)(3)) is amended— 

(A) by redesignating subparagraph (D) as subparagraph (F); and 

(B) by inserting after subparagraph (C) the following 

new subparagraphs: 

‘‘(D) SATISFACTORY REPORTING MEASURES THROUGH

PARTICIPATION IN A QUALIFIED CLINICAL DATA REGISTRY.— 

For 2014 and subsequent years, the Secretary shall treat 

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H. R. 8—34 

an eligible professional as satisfactorily submitting data 

on quality measures under subparagraph (A) if, in lieu 

of reporting measures under subsection (k)(2)(C), the 

eligible professional is satisfactorily participating, as determined by the Secretary, in a qualified clinical data registry 

(as described in subparagraph (E)) for the year. 

‘‘(E) QUALIFIED CLINICAL DATA REGISTRY.— 

‘‘(i) IN GENERAL.—The Secretary shall establish 

requirements for an entity to be considered a qualified 

clinical data registry. Such requirements shall include 

a requirement that the entity provide the Secretary 

with such information, at such times, and in such 

manner, as the Secretary determines necessary to carry 

out this subsection. 

‘‘(ii) CONSIDERATIONS.—In establishing the requirements under clause (i), the Secretary shall consider 

whether an entity— 

‘‘(I) has in place mechanisms for the transparency of data elements and specifications, risk 

models, and measures; 

‘‘(II) requires the submission of data from 

participants with respect to multiple payers; 

‘‘(III) provides timely performance reports to 

participants at the individual participant level; and 

‘‘(IV) supports quality improvement initiatives 

for participants. 

‘‘(iii) MEASURES.—With respect to measures used 

by a qualified clinical data registry— 

‘‘(I) sections 1890(b)(7) and 1890A(a) shall not 

apply; and 

‘‘(II) measures endorsed by the entity with 

a contract with the Secretary under section 1890(a) 

may be used. 

‘‘(iv) CONSULTATION.—In carrying out this subparagraph, the Secretary shall consult with interested parties. 

‘‘(v) DETERMINATION.—The Secretary shall establish a process to determine whether or not an entity 

meets the requirements established under clause (i). 

Such process may involve one or both of the following: 

‘‘(I) A determination by the Secretary. 

‘‘(II) A designation by the Secretary of one 

or more independent organizations to make such 

determination.’’. 

(2) GAO STUDY AND REPORT ON INCORPORATING REGISTRY

DATA INTO THE MEDICARE PROGRAM IN ORDER TO IMPROVE

QUALITY AND EFFICIENCY.— 

(A) STUDY.—The Comptroller General of the United 

States shall conduct a study on the potential of clinical 

data registries to improve the quality and efficiency of 

care in the Medicare program, including through payment 

system incentives. Such study shall include an analysis 

of the role of health information technology in facilitating 

clinical data registries and the use of data from such registries among private health insurers as well as other entities the Comptroller General determines appropriate. 

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(B) REPORT.—Not later than November 15, 2013, the 

Comptroller General of the United States shall submit 

to Congress a report on the study conducted under subparagraph (A), together with recommendations for such legislation and administrative action as the Comptroller General 

determines appropriate. 

SEC. 602. WORK GEOGRAPHIC ADJUSTMENT. 

Section 1848(e)(1)(E) of the Social Security Act (42 U.S.C. 

1395w–4(e)(1)(E)) is amended by striking ‘‘before January 1, 2013’’ 

and inserting ‘‘before January 1, 2014’’. 

SEC. 603. PAYMENT FOR OUTPATIENT THERAPY SERVICES. 

(a) EXTENSION.—Section 1833(g) of the Social Security Act (42 

U.S.C. 1395l(g)) is amended— 

(1) in paragraph (5)(A), in the first sentence, by striking 

‘‘December 31, 2012’’ and inserting ‘‘December 31, 2013’’; and 

(2) in paragraph (6)— 

(A) by striking ‘‘December 31, 2012’’ and inserting 

‘‘December 31, 2013’’; and 

(B) by inserting ‘‘or 2013’’ after ‘‘during 2012’’. 

(b) APPLICATION OF THERAPY CAP TO THERAPY FURNISHED AS

PART OF OUTPATIENT CRITICAL ACCESS HOSPITAL SERVICES.—Section 1833(g)(6) of the Social Security Act (42 U.S.C. 1395l(g)(6)), 

as amended by subsection (a), is amended— 

(1) by striking ‘‘In applying’’ and inserting ‘‘(A) In applying’’; 

and 

(2) by adding at the end the following new subparagraph: 

‘‘(B)(i) With respect to outpatient therapy services furnished 

beginning on or after January 1, 2013, and before January 1, 

2014, for which payment is made under section 1834(g), the Secretary shall count toward the uniform dollar limitations described 

in paragraphs (1) and (3) and the threshold described in paragraph 

(5)(C) the amount that would be payable under this part if such 

services were paid under section 1834(k)(1)(B) instead of being 

paid under section 1834(g). 

‘‘(ii) Nothing in clause (i) shall be construed as changing the 

method of payment for outpatient therapy services under section 

1834(g).’’. 

(c) BENEFICIARY PROTECTIONS.—Section 1833(g)(5) of the Social 

Security Act (42 U.S.C. 1395l(g)(5)) is amended by adding at the 

end the following new subparagraph: 

‘‘(D) With respect to services furnished on or after January 

1, 2013, where payment may not be made as a result of application 

of paragraphs (1) and (3), section 1879 shall apply in the same 

manner as such section applies to a denial that is made by reason 

of section 1862(a)(1).’’. 

(d) IMPLEMENTATION.—Notwithstanding any other provision of 

law, the Secretary of Health and Human Services may implement 

the provisions of, and the amendments made by, this section by 

program instruction or otherwise. 

SEC. 604. AMBULANCE ADD-ON PAYMENTS. 

(a) GROUND AMBULANCE.—Section 1834(l)(13)(A) of the Social 

Security Act (42 U.S.C. 1395m(l)(13)(A)) is amended— 

(1) in the matter preceding clause (i), by striking ‘‘January 

1, 2013’’ and inserting ‘‘January 1, 2014’’; and 

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(2) in each of clauses (i) and (ii), by striking ‘‘January 

1, 2013’’ and inserting ‘‘January 1, 2014’’ each place it appears. 

(b) AIR AMBULANCE.—Section 146(b)(1) of the Medicare 

Improvements for Patients and Providers Act of 2008 (Public Law 

110–275), as amended by sections 3105(b) and 10311(b) of the 

Patient Protection and Affordable Care Act (Public Law 111–148), 

section 106(b) of the Medicare and Medicaid Extenders Act of 2010 

(Public Law 111–309), section 306(b) of the Temporary Payroll 

Tax Cut Continuation Act of 2011 (Public Law 112–78), and section 

3007(b) of the Middle Class Tax Relief and Job Creation Act of 

2012 (Public Law 112–96), is amended by striking ‘‘December 31, 

2012’’ and inserting ‘‘June 30, 2013’’. 

(c) SUPER RURAL AMBULANCE.—Section 1834(l)(12)(A) of the 

Social Security Act (42 U.S.C. 1395m(l)(12)(A)) is amended in the 

first sentence by striking ‘‘January 1, 2013’’ and inserting ‘‘January 

1, 2014’’. 

(d) STUDIES OF AMBULANCE COSTS.— 

(1) IN GENERAL.—The Secretary of Health and Health and 

Human Services (in this subsection referred to as the ‘‘Secretary’’) shall conduct a study of each of the following: 

(A) A study that analyzes data on existing cost reports 

for ambulance services furnished by hospitals and critical 

access hospitals, including variation by characteristics of 

such providers of services. 

(B) A study of the feasibility of obtaining cost data 

on a periodic basis from all ambulance providers of services 

and suppliers for potential use in examining the appropriateness of the Medicare add-on payments for ground 

ambulance services furnished under the fee schedule under 

section 1834(l) of the Social Security Act (42 U.S.C. 

1395m(l)) and in preparing for future reform of such payment system. 

(2) COMPONENTS OF ONE OF THE STUDIES.—In conducting 

the study under paragraph (1)(B), the Secretary shall— 

(A) consult with industry on the design of such cost 

collection efforts; 

(B) explore use of cost surveys and cost reports to 

collect appropriate cost data and the periodicity of such 

cost data collection; 

(C) examine the feasibility of development of a 

standard cost reporting tool for providers of services and 

suppliers of ground ambulance services; and 

(D) examine the ability to furnish such cost data by 

various types of ambulance providers of services and suppliers, especially by rural and super-rural providers of services and suppliers. 

(3) REPORTS.— (A) EXISTING COST REPORTS.—Not later than October 

1, 2013, the Secretary shall submit a report to Congress 

on the study conducted under paragraph (1)(A), together 

with recommendations for such legislation and administrative action as the Secretary determines appropriate. 

(B) OBTAINING COST DATA.—Not later than July 1, 

2014, the Secretary shall submit a report to Congress on 

the study conducted under paragraph (1)(B), together with 

recommendations for such legislation and administrative 

action as the Secretary determines appropriate. 

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SEC. 605. EXTENSION OF MEDICARE INPATIENT HOSPITAL PAYMENT 

ADJUSTMENT FOR LOW-VOLUME HOSPITALS. 

Section 1886(d)(12) of the Social Security Act (42 U.S.C. 

1395ww(d)(12)) is amended— 

(1) in subparagraph (B), in the matter preceding clause 

(i), by striking ‘‘2013’’ and inserting ‘‘2014’’; 

(2) in subparagraph (C)(i), by striking ‘‘and 2012’’ each 

place it appears and inserting ‘‘, 2012, and 2013’’; and 

(3) in subparagraph (D), by striking ‘‘and 2012’’ and 

inserting ‘‘, 2012, and 2013’’. 

SEC. 606. EXTENSION OF THE MEDICARE-DEPENDENT HOSPITAL (MDH) 

PROGRAM. 

(a) EXTENSION OF PAYMENT METHODOLOGY.—Section 

1886(d)(5)(G) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(G)) 

is amended— 

(1) in clause (i), by striking ‘‘October 1, 2012’’ and inserting 

‘‘October 1, 2013’’; and 

(2) in clause (ii)(II), by striking ‘‘October 1, 2012’’ and 

inserting ‘‘October 1, 2013’’. 

(b) CONFORMING AMENDMENTS.— 

(1) EXTENSION OF TARGET AMOUNT.—Section 1886(b)(3)(D) 

of the Social Security Act (42 U.S.C. 1395ww(b)(3)(D)) is 

amended— 

(A) in the matter preceding clause (i), by striking 

‘‘October 1, 2012’’ and inserting ‘‘October 1, 2013’’; and 

(B) in clause (iv), by striking ‘‘through fiscal year 2012’’ 

and inserting ‘‘through fiscal year 2013’’. 

(2) PERMITTING HOSPITALS TO DECLINE RECLASSIFICATION.— 

Section 13501(e)(2) of the Omnibus Budget Reconciliation Act 

of 1993 (42 U.S.C. 1395ww note) is amended by striking 

‘‘through fiscal year 2012’’ and inserting ‘‘through fiscal year 

2013’’. 

SEC. 607. EXTENSION FOR SPECIALIZED MEDICARE ADVANTAGE 

PLANS FOR SPECIAL NEEDS INDIVIDUALS. 

Section 1859(f)(1) of the Social Security Act (42 U.S.C. 1395w– 

28(f)(1)) is amended by striking ‘‘2014’’ and inserting ‘‘2015’’. 

SEC. 608. EXTENSION OF MEDICARE REASONABLE COST CONTRACTS. 

Section 1876(h)(5)(C)(ii) of the Social Security Act (42 U.S.C. 

1395mm(h)(5)(C)(ii)) is amended, in the matter preceding subclause 

(I), by striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’. 

SEC. 609. PERFORMANCE IMPROVEMENT. 

(a) EXTENSION OF FUNDING FOR CONTRACT WITH CONSENSUS- BASED ENTITY REGARDING PERFORMANCE MEASUREMENT.— (1) IN GENERAL.—Section 1890(d) of the Social Security 

Act (42 U.S.C. 1395aaa(d)) is amended by striking ‘‘fiscal years 

2009 through 2012’’ and inserting ‘‘fiscal years 2009 through 

2013’’. 

(2) REVISION TO DUTIES.—Section 1890(b) of the Social 

Security Act (42 U.S.C. 1395aaa(b)) is amended by striking 

paragraph (4). 

(b) PROVIDING DATA FOR PERFORMANCE IMPROVEMENT IN A

TIMELY MANNER.— 

(1) IN GENERAL.—The Secretary of Health and Human 

Services (in this subsection referred to as the ‘‘Secretary’’) shall 

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develop a strategy to provide data for performance improvement 

in a timely manner to applicable providers under the Medicare 

program under title XVIII of the Social Security Act (42 U.S.C. 

1395 et seq.), including with respect to the provision of the 

following: 

(A) Utilization data, including such data for items and 

services under parts A, B, and D of the Medicare program. 

(B) Feedback on quality data submitted by the 

applicable provider under the Medicare program. 

(2) CONSIDERATIONS.—In developing the strategy under 

paragraph (1), the Secretary shall consider— 

(A) the type of applicable provider receiving the data; 

(B) the frequency of providing the data so that it can 

be the most relevant in improving provider performance; 

(C) risk adjustment methods; 

(D) presentation of the data in a meaningful manner 

and easily understandable format; 

(E) with respect to utilization data, the provision of 

data that the Secretary determines would be useful to 

improve the performance of the type of applicable provider 

involved; and 

(F) administrative costs involved with providing data. 

(3) SUBMISSION AND AVAILABILITY OF INITIAL STRATEGY.— 

Not later than 1 year after the date of the enactment of this 

Act, the Secretary shall— 

(A) submit to the relevant committees of Congress 

the strategy described in paragraph (1); and 

(B) post such strategy on the website of the Centers 

for Medicare & Medicaid Services. 

(4) STRATEGY UPDATE.— (A) FEEDBACK FROM STAKEHOLDERS.—The Secretary 

shall seek feedback from stakeholders on the initial 

strategy submitted under paragraph (3). 

(B) STRATEGY UPDATE.—The Secretary shall— 

(i) update the strategy described in paragraph (1) 

based on the feedback submitted under subparagraph 

(A); and 

(ii) not later than 18 months after the date of 

the enactment of this Act— 

(I) submit such updated strategy to the relevant committees of Congress; and 

(II) post such updated strategy on the website 

of the Centers for Medicare & Medicaid Services. 

(5) GAO STUDY AND REPORT ON PRIVATE SECTOR INFORMATION SHARING ACTIVITIES.— 

(A) STUDY.—The Comptroller General of the United 

States (in this paragraph referred to as the ‘‘Comptroller 

General’’) shall conduct a study on information sharing 

activities. Such study shall include an analysis of— 

(i) how private sector entities share timely data 

with hospitals, physicians, and other providers and 

what lessons can be learned from those activities; 

(ii) how the Medicare program currently shares 

data with providers, including what data is provided 

and to which providers, and what divisions within 

the Centers for Medicare & Medicaid Services oversee 

those efforts; 

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(iii) what, if any, differences there are between 

the private sector and the Medicare program under 

title XVIII of the Social Security Act (42 U.S.C. 1395 

et seq.) in terms of sharing data; and 

(iv) what, if any, barriers there are for the Centers 

for Medicare & Medicaid Services to sharing timely 

data with applicable providers and recommendations 

to eliminate or reduce such barriers. 

(B) REPORT.—Not later than 8 months after the date 

of the enactment of this Act, the Comptroller General shall 

submit to the relevant committees of Congress a report 

containing the results of the study conducted under 

subparagraph (A), together with recommendations for such 

legislation and administrative action as the Comptroller 

General determines appropriate. 

(6) DEFINITIONS.—In this subsection: 

(A) APPLICABLE PROVIDER.—The term ‘‘applicable provider’’ means the following: 

(i) A critical access hospital (as defined in section 

1861(mm)(1) of the Social Security Act (42 U.S.C. 

1395xx(mm)(1))). 

(ii) A hospital (as defined in section 1861(e) of 

such Act (42 U.S.C. 1395x(e))). 

(iii) A physician (as defined in section 1861(r) of 

such Act (42 U.S.C. 1395x(r))). 

(iv) Any other provider the Secretary determines 

should receive the information described in subsection 

(a). 

(B) PERFORMANCE IMPROVEMENT.—The term ‘‘performance improvement’’ means improvements in quality, 

reducing per capita costs, and other criteria the Secretary 

determines appropriate. 

SEC. 610. EXTENSION OF FUNDING OUTREACH AND ASSISTANCE FOR 

LOW-INCOME PROGRAMS. 

(a) ADDITIONAL FUNDING FOR STATE HEALTH INSURANCE PRO- GRAMS.—Subsection (a)(1)(B) of section 119 of the Medicare 

Improvements for Patients and Providers Act of 2008 (42 U.S.C. 

1395b–3 note), as amended by section 3306 of the Patient Protection 

and Affordable Care Act Public Law 111–148), is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: ‘‘(iii) for fiscal year 2013, of $7,500,000.’’. 

(b) ADDITIONAL FUNDING FOR AREA AGENCIES ON AGING.— 

Subsection (b)(1)(B) of such section 119, as so amended, is 

amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: 

‘‘(iii) for fiscal year 2013, of $7,500,000.’’. 

(c) ADDITIONAL FUNDING FOR AGING AND DISABILITY RESOURCE

CENTERS.—Subsection (c)(1)(B) of such section 119, as so amended, 

is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

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(2) in clause (ii), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: 

‘‘(iii) for fiscal year 2013, of $5,000,000.’’. 

(d) ADDITIONAL FUNDING FOR CONTRACT WITH THE NATIONAL

CENTER FOR BENEFITS AND OUTREACH ENROLLMENT.—Subsection 

(d)(2) of such section 119, as so amended, is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: 

‘‘(iii) for fiscal year 2013, of $5,000,000.’’. 

Subtitle B—Other Health Extensions 

SEC. 621. EXTENSION OF THE QUALIFYING INDIVIDUAL (QI) PROGRAM. 

(a) EXTENSION.—Section 1902(a)(10)(E)(iv) of the Social Security 

Act (42 U.S.C. 1396a(a)(10)(E)(iv)) is amended by striking ‘‘2012’’ 

and inserting ‘‘2013’’. 

(b) EXTENDING TOTAL AMOUNT AVAILABLE FOR ALLOCATION.— 

Section 1933(g) of such Act (42 U.S.C. 1396u–3(g)) is amended— 

(1) in paragraph (2)— 

(A) in subparagraph (Q), by striking ‘‘and’’ after the 

semicolon; 

(B) in subparagraph (R), by striking the period at 

the end and inserting a semicolon; and 

(C) by adding at the end the following new subparagraphs: 

‘‘(S) for the period that begins on January 1, 2013, 

and ends on September 30, 2013, the total allocation 

amount is $485,000,000; and 

‘‘(T) for the period that begins on October 1, 2013, 

and ends on December 31, 2013, the total allocation amount 

is $300,000,000.’’; and 

(2) in paragraph (3), in the matter preceding subparagraph 

(A), by striking ‘‘or (R)’’ and inserting ‘‘(R), or (T)’’. 

SEC. 622. EXTENSION OF TRANSITIONAL MEDICAL ASSISTANCE (TMA). 

Sections 1902(e)(1)(B) and 1925(f) of the Social Security Act 

(42 U.S.C. 1396a(e)(1)(B), 1396r–6(f)) are each amended by striking 

‘‘2012’’ and inserting ‘‘2013’’. 

SEC. 623. EXTENSION OF MEDICAID AND CHIP EXPRESS LANE OPTION. 

Section 1902(e)(13)(I) of the Social Security Act (42 U.S.C. 

1396a(e)(13)(I)) is amended by striking ‘‘2013’’ and inserting ‘‘2014’’. 

SEC. 624. EXTENSION OF FAMILY-TO-FAMILY HEALTH INFORMATION 

CENTERS. 

Section 501(c)(1)(A)(iii) of the Social Security Act (42 U.S.C. 

701(c)(1)(A)(iii)) is amended by striking ‘‘2012’’ and inserting ‘‘2013’’. 

SEC. 625. EXTENSION OF SPECIAL DIABETES PROGRAM FOR TYPE I 

DIABETES AND FOR INDIANS. 

(a) SPECIAL DIABETES PROGRAMS FOR TYPE I DIABETES.—Section 330B(b)(2)(C) of the Public Health Service Act (42 U.S.C. 254c– 

2(b)(2)(C)) is amended by striking ‘‘2013’’ and inserting ‘‘2014’’. 

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(b) SPECIAL DIABETES PROGRAMS FOR INDIANS.—Section 

330C(c)(2)(C) of the Public Health Service Act (42 U.S.C. 254c– 

3(c)(2)(C)) is amended by striking ‘‘2013’’ and inserting ‘‘2014’’. 

Subtitle C—Other Health Provisions 

SEC. 631. IPPS DOCUMENTATION AND CODING ADJUSTMENT FOR 

IMPLEMENTATION OF MS-DRGS. 

(a) RULE OF CONSTRUCTION AND CLARIFICATION.— 

(1) RULE OF CONSTRUCTION.—Nothing in the amendments 

made by subsection (b) shall be construed as changing the 

existing authority under section 1886(d) of the Social Security 

Act (42 U.S.C. 1395ww(d)) to make prospective documentation 

and coding adjustments to the standardized amounts under 

such section 1886(d) to correct for changes in the coding or 

classification of discharges that do not reflect real changes 

in case mix. 

(2) CLARIFICATION.—Effective on the date of the enactment 

of this section, except as provided in section 7(b)(1)(B)(ii) of 

the TMA, Abstinence Education, and QI Programs Extension 

Act of 2007, as added by subsection (b)(2)(A)(ii)(IV) of this 

section, the Secretary of Health and Human Services shall 

not have authority to fully recoup past overpayments related 

to documentation and coding changes from fiscal years 2008 

and 2009. 

(b) ADJUSTMENT.—Section 7 of the TMA, Abstinence Education, 

and QI Programs Extension Act of 2007 (Public Law 110–90; 121 

Stat. 986) is amended— 

(1) in the heading, by striking ‘‘LIMITATION’’ and all that 

follows through ‘‘ADJUSTMENT’’ and inserting ‘‘DOCUMENTATION

AND CODING ADJUSTMENTS’’; and 

(2) in subsection (b)— 

(A) in paragraph (1)— 

(i) in the matter before subparagraph (A)— 

(I) by striking ‘‘or 2009’’ and inserting ‘‘, 2009, 

or 2010’’; and 

(II) by inserting ‘‘or otherwise applied for such 

year’’ after ‘‘applied under subsection (a)’’; and 

(ii) in subparagraph (B)— 

(I) by inserting ‘‘(i)’’ after ‘‘(B)’’; 

(II) by striking ‘‘or decrease’’; 

(III) by striking the period at the end and 

inserting ‘‘; and’’; and 

(IV) by adding at the end the following: 

‘‘(ii) make an additional adjustment to the standardized 

amounts under such section 1886(d) based upon the Secretary’s estimates for discharges occurring only during 

fiscal years 2014, 2015, 2016, and 2017 to fully offset 

$11,000,000,000 (which represents the amount of the 

increase in aggregate payments from fiscal years 2008 

through 2013 for which an adjustment was not previously 

applied).’’; and 

(B) in paragraph (3)— 

(i) in subparagraph (A), by inserting before the 

semicolon the following: ‘‘or affecting the Secretary’s 

authority under such paragraph to apply a prospective 

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adjustment to offset aggregate additional payments 

related to documentation and coding improvements 

made with respect to discharges during fiscal year 

2010’’; and 

(ii) in subparagraph (B), by striking ‘‘and 2012’’ 

and inserting ‘‘2012, 2014, 2015, 2016, and 2017’’. 

SEC. 632. REVISIONS TO THE MEDICARE ESRD BUNDLED PAYMENT 

SYSTEM TO REFLECT FINDINGS IN THE GAO REPORT. 

(a) ADJUSTMENT TO ESRD BUNDLED PAYMENT RATE TO

ACCOUNT FOR CHANGES IN THE UTILIZATION OF CERTAIN DRUGS

AND BIOLOGICALS.—Section 1881(b)(14) of the Social Security Act 

(42 U.S.C. 1395rr(b)(14)) is amended by adding at the end the 

following new subparagraph: 

‘‘(I) For services furnished on or after January 1, 2014, the 

Secretary shall, by comparing per patient utilization data from 

2007 with such data from 2012, make reductions to the single 

payment that would otherwise apply under this paragraph for renal 

dialysis services to reflect the Secretary’s estimate of the change 

in the utilization of drugs and biologicals described in clauses 

(ii), (iii), and (iv) of subparagraph (B) (other than oral-only ESRDrelated drugs, as such term is used in the final rule promulgated 

by the Secretary in the Federal Register on August 12, 2010 (75 

Fed. Reg. 49030)). In making reductions under the preceding sentence, the Secretary shall take into account the most recently available data on average sales prices and changes in prices for drugs 

and biological reflected in the ESRD market basket percentage 

increase factor under subparagraph (F).’’. 

(b) TWO-YEAR DELAY OF IMPLEMENTATION OF ORAL-ONLY ESRDRELATED DRUGS IN THE ESRD PROSPECTIVE PAYMENT SYSTEM; 

MONITORING.— (1) DELAY.—The Secretary of Health and Human Services 

may not implement the policy under section 413.174(f)(6) of 

title 42, Code of Federal Regulations (relating to oral-only 

ESRD-related drugs in the ESRD prospective payment system), 

prior to January 1, 2016. 

(2) MONITORING.—With respect to the implementation of 

oral-only ESRD-related drugs in the ESRD prospective payment 

system under subsection (b)(14) of section 1881 of the Social 

Security Act (42 U.S.C. 1395rr(b)(14)), the Secretary of Health 

and Human Services shall monitor the bone and mineral 

metabolism of individuals with end stage renal disease. 

(c) ANALYSIS OF CASE MIX PAYMENT ADJUSTMENTS.—By not 

later than January 1, 2016, the Secretary of Health and Human 

Services shall— 

(1) conduct an analysis of the case mix payment adjustments being used under section 1881(b)(14)(D)(i) of the Social 

Security Act (42 U.S.C. 1395rr(b)(14)(D)(i)); and 

(2) make appropriate revisions to such case mix payment 

adjustments. 

(d) UPDATED GAO REPORT.—Not later than December 31, 2015, 

the Comptroller General of the United States shall submit to Congress a report that updates the report submitted to Congress under 

section 10336 of the Patient Protection and Affordable Care Act 

(Public Law 111–148; 124 Stat. 974). The updated report shall 

include an analysis of how the Secretary of Health and Human 

Services has addressed points raised in the report submitted under 

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such section 10336 with respect to the Secretary’s preparations 

to implement payment for oral-only ESRD-related drugs in the 

bundled prospective payment system under section 1881(b)(14) of 

the Social Security Act (42 U.S.C. 1395rr(b)(14)). 

SEC. 633. TREATMENT OF MULTIPLE SERVICE PAYMENT POLICIES FOR 

THERAPY SERVICES. 

(a) SERVICES FURNISHED BY PHYSICIANS AND CERTAIN OTHER

PROVIDERS.—Section 1848(b)(7) of the Social Security Act (42 U.S.C. 

1395w–4(b)(7)) is amended— 

(1) by striking ‘‘2011,’’ and inserting ‘‘2011, and before 

April 1, 2013,’’; and 

(2) by adding at the end the following new sentence: ‘‘In 

the case of such services furnished on or after April 1, 2013, 

and for which payment is made under such fee schedules, 

instead of the 25 percent multiple procedure payment reduction 

specified in such final rule, the reduction percentage shall 

be 50 percent.’’. 

(b) SERVICES FURNISHED BY OTHER PROVIDERS.—Section 

1834(k) of the Social Security Act (42 U.S.C. 1395m(k)) is amended 

by adding at the end the following new paragraph: 

‘‘(7) ADJUSTMENT IN DISCOUNT FOR CERTAIN MULTIPLE

THERAPY SERVICES.—In the case of therapy services furnished 

on or after April 1, 2013, and for which payment is made 

under this subsection pursuant to the applicable fee schedule 

amount (as defined in paragraph (3)), instead of the 25 percent 

multiple procedure payment reduction specified in the final 

rule published by the Secretary in the Federal Register on 

November 29, 2010, the reduction percentage shall be 50 percent.’’. 

SEC. 634. PAYMENT FOR CERTAIN RADIOLOGY SERVICES FURNISHED 

UNDER THE MEDICARE HOSPITAL OUTPATIENT DEPARTMENT PROSPECTIVE PAYMENT SYSTEM. 

Section 1833(t)(16) of the Social Security Act (42 U.S.C. 

1395l(t)(16)) is amended by adding at the end the following new 

subparagraph: 

‘‘(D) SPECIAL PAYMENT RULE.— ‘‘(i) IN GENERAL.—In the case of covered OPD services furnished on or after April 1, 2013, in a hospital 

described in clause (ii), if— 

‘‘(I) the payment rate that would otherwise 

apply under this subsection for stereotactic 

radiosurgery, complete course of treatment of cranial lesion(s) consisting of 1 session that is multisource Cobalt 60 based (identified as of January 

1, 2013, by HCPCS code 77371 (and any succeeding 

code) and reimbursed as of such date under APC 

0127 (and any succeeding classification group)); 

exceeds 

‘‘(II) the payment rate that would otherwise 

apply under this subsection for linear accelerator 

based stereotactic radiosurgery, complete course 

of therapy in one session (identified as of January 

1, 2013, by HCPCS code G0173 (and any succeeding code) and reimbursed as of such date under 

APC 0067 (and any succeeding classification 

group)), 

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the payment rate for the service described in subclause 

(I) shall be reduced to an amount equal to the payment 

rate for the service described in subclause (II). 

‘‘(ii) HOSPITAL DESCRIBED.—A hospital described 

in this clause is a hospital that is not— 

‘‘(I) located in a rural area (as defined in section 1886(d)(2)(D)); 

‘‘(II) classified as a rural referral center under 

section 1886(d)(5)(C); or 

‘‘(III) a sole community hospital (as defined 

in section 1886(d)(5)(D)(iii)). 

‘‘(iii) NOT BUDGET NEUTRAL.—In making any 

budget neutrality adjustments under this subsection 

for 2013 (with respect to covered OPD services furnished on or after April 1, 2013, and before January 

1, 2014) or a subsequent year, the Secretary shall 

not take into account the reduced expenditures that 

result from the application of this subparagraph.’’. 

SEC. 635. ADJUSTMENT OF EQUIPMENT UTILIZATION RATE FOR 

ADVANCED IMAGING SERVICES. 

Section 1848 of the Social Security Act (42 U.S.C. 1395w– 

4) is amended— 

(1) in subsection (b)(4)(C)— 

(A) by striking ‘‘and subsequent years’’ and inserting 

‘‘, 2012, and 2013’’; and 

(B) by adding at the end the following new sentence: 

‘‘With respect to fee schedules established for 2014 and 

subsequent years, in such methodology, the Secretary shall 

use a 90 percent utilization rate.’’; and 

(2) in subsection (c)(2)(B)(v)(III), by striking ‘‘change in 

the utilization rate applicable to 2011, as described in’’ and 

inserting ‘‘changes in the utilization rate applicable to 2011 

and 2014, as described in the first and second sentence, respectively, of’’. 

SEC. 636. MEDICARE PAYMENT OF COMPETITIVE PRICES FOR 

DIABETIC SUPPLIES AND ELIMINATION OF OVERPAYMENT 

FOR DIABETIC SUPPLIES. 

(a) APPLICATION OF COMPETITIVE BIDDING PRICES FOR DIABETIC

SUPPLIES.—Section 1834(a)(1) of the Social Security Act (42 U.S.C. 

1395m(a)(1)) is amended— 

(1) in subparagraph (F), in the matter preceding clause 

(i), by striking ‘‘subparagraph (G)’’ and inserting ‘‘subparagraphs (G) and (H)’’; and 

(2) by adding at the end the following new subparagraph: 

‘‘(H) DIABETIC SUPPLIES.— ‘‘(i) IN GENERAL.—On or after the date described 

in clause (ii), the payment amount under this part 

for diabetic supplies, including testing strips, that are 

non-mail order items (as defined by the Secretary) 

shall be equal to the single payment amounts established under the national mail order competition for 

diabetic supplies under section 1847. 

‘‘(ii) DATE DESCRIBED.—The date described in this 

clause is the date of the implementation of the single 

payment amounts under the national mail order competition for diabetic supplies under section 1847.’’. 

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(b) OVERPAYMENT ELIMINATION FOR DIABETIC SUPPLIES.—Section 1834(a) of the Social Security Act (42 U.S.C. 1395m(a)) is 

amended by adding at the end the following new paragraph: 

‘‘(22) SPECIAL PAYMENT RULE FOR DIABETIC SUPPLIES.—Notwithstanding the preceding provisions of this subsection, for 

purposes of determining the payment amount under this subsection for diabetic supplies furnished on or after the first 

day of the calendar quarter during 2013 that is at least 30 

days after the date of the enactment of this paragraph and 

before the date described in paragraph (1)(H)(ii), the Secretary 

shall recalculate and apply the covered item update under 

paragraph (14) as if subparagraph (J)(i) of such paragraph 

was amended by striking ‘but only if furnished through mail 

order’.’’. 

SEC. 637. MEDICARE PAYMENT ADJUSTMENT FOR NON-EMERGENCY 

AMBULANCE TRANSPORTS FOR ESRD BENEFICIARIES. 

Section 1834(l) of the Social Security Act (42 U.S.C. 1395m(l)) 

is amended by adding at the end the following new paragraph: 

‘‘(15) PAYMENT ADJUSTMENT FOR NON-EMERGENCY AMBULANCE TRANSPORTS FOR ESRD BENEFICIARIES.—The fee schedule 

amount otherwise applicable under the preceding provisions 

of this subsection shall be reduced by 10 percent for ambulance 

services furnished on or after October 1, 2013, consisting of 

non-emergency basic life support services involving transport 

of an individual with end-stage renal disease for renal dialysis 

services (as described in section 1881(b)(14)(B)) furnished other 

than on an emergency basis by a provider of services or a 

renal dialysis facility.’’. 

SEC. 638. REMOVING OBSTACLES TO COLLECTION OF OVERPAYMENTS. 

(a) IN GENERAL.—The last sentence of subsections (b) and (c) 

of section 1870 of the Social Security Act (42 U.S.C. 1395gg) are 

each amended— 

(1) by striking ‘‘third year’’ and inserting ‘‘fifth year’’; and 

(2) by striking ‘‘three-year’’ and inserting ‘‘five-year’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall take effect on the date of the enactment of this Act. 

SEC. 639. MEDICARE ADVANTAGE CODING INTENSITY ADJUSTMENT. 

Section 1853(a)(1)(C)(ii)(III) of the Social Security Act (42 U.S.C. 

1395w–23(a)(1)(C)(ii)(III)) is amended— 

(1) by striking ‘‘1.3 percentage points’’ and inserting ‘‘1.5 

percentage points’’; and 

(2) by striking ‘‘5.7 percent’’ and inserting ‘‘5.9 percent’’. 

SEC. 640. ELIMINATION OF ALL FUNDING FOR THE MEDICARE 

IMPROVEMENT FUND. 

Section 1898(b)(1) of the Social Security Act (42 U.S.C. 

1395iii(b)(1)) is amended by striking subparagraphs (A), (B), and 

(C) and inserting the following new subparagraphs: ‘‘(A) fiscal year 2014, $0; and 

‘‘(B) fiscal year 2015, $0.’’. 

SEC. 641. REBASING OF STATE DSH ALLOTMENTS. 

Section 1923(f)(8) of the Social Security Act (42 U.S.C. 1396r– 

4(f)(8)) is amended to read as follows: 

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‘‘(8) SPECIAL RULES FOR CALCULATING DSH ALLOTMENTS FOR

CERTAIN FISCAL YEARS.— ‘‘(A) FISCAL YEAR 2021.—Only with respect to fiscal 

year 2021, the DSH allotment for a State, in lieu of the 

amount determined under paragraph (3) for the State for 

that year, shall be equal to the DSH allotment for the 

State as reduced under paragraph (7) for fiscal year 2020, 

increased, subject to subparagraphs (B) and (C) of paragraph (3), and paragraph (5), by the percentage change 

in the consumer price index for all urban consumers (all 

items; U.S. city average), for fiscal year 2020. 

‘‘(B) FISCAL YEAR 2022.—Only with respect to fiscal 

year 2022, the DSH allotment for a State, in lieu of the 

amount determined under paragraph (3) for the State for 

that year, shall be equal to the DSH allotment for the 

State for fiscal year 2021, as determined under subparagraph (A), increased, subject to subparagraphs (B) and 

(C) of paragraph (3), and paragraph (5), by the percentage 

change in the consumer price index for all urban consumers 

(all items; U.S. city average), for fiscal year 2021. 

‘‘(C) SUBSEQUENT FISCAL YEARS.—The DSH allotment 

for a State for fiscal years after fiscal year 2022 shall 

be calculated under paragraph (3) without regard to this 

paragraph and paragraph (7).’’. 

SEC. 642. REPEAL OF CLASS PROGRAM. 

(a) REPEAL.—Title XXXII of the Public Health Service Act (42 

U.S.C. 300ll et seq.; relating to the CLASS program) is repealed. 

(b) CONFORMING CHANGES.— (1) Title VIII of the Patient Protection and Affordable Care 

Act (Public Law 111–148; 124 Stat. 119, 846–847) is repealed. 

(2) Section 1902(a) of the Social Security Act (42 U.S.C. 

1396a(a)) is amended— 

(A) by striking paragraphs (81) and (82); 

(B) in paragraph (80), by inserting ‘‘and’’ at the end; 

and 

(C) by redesignating paragraph (83) as paragraph (81). 

(3) Paragraphs (2) and (3) of section 6021(d) of the Deficit 

Reduction Act of 2005 (42 U.S.C. 1396p note) are amended 

to read as such paragraphs were in effect on the day before 

the date of the enactment of section 8002(d) of the Patient 

Protection and Affordable Care Act (Public Law 111–148). Of 

the funds appropriated by paragraph (3) of such section 6021(d), 

as amended by the Patient Protection and Affordable Care 

Act, the unobligated balance is rescinded. 

SEC. 643. COMMISSION ON LONG-TERM CARE. 

(a) ESTABLISHMENT.—There is established a commission to be 

known as the Commission on Long-Term Care (referred to in this 

section as the ‘‘Commission’’). 

(b) DUTIES.— 

(1) IN GENERAL.—The Commission shall develop a plan 

for the establishment, implementation, and financing of a comprehensive, coordinated, and high-quality system that ensures 

the availability of long-term services and supports for individuals in need of such services and supports, including elderly 

individuals, individuals with substantial cognitive or functional 

limitations, other individuals who require assistance to perform 

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activities of daily living, and individuals desiring to plan for 

future long-term care needs. 

(2) EXISTING HEALTH CARE PROGRAMS.—For purposes of 

developing the plan described in paragraph (1), the Commission 

shall provide recommendations for— 

(A) addressing the interaction of a long-term services 

and support system with existing programs for long-term 

services and supports, including the Medicare program 

under title XVIII of the Social Security Act (42 U.S.C. 

1395 et seq.) and the Medicaid program under title XIX 

of the Social Security Act (42 U.S.C. 1396 et seq.), and 

private long-term care insurance; 

(B) improvements to such health care programs that 

are necessary for ensuring the availability of long-term 

services and supports; and 

(C) issues related to workers who provide long-term 

services and supports, including— 

(i) whether the number of such workers is adequate to provide long-term services and supports to 

individuals with long-term care needs; 

(ii) workforce development necessary to deliver 

high-quality services to such individuals; 

(iii) development of entities that have the capacity 

to serve as employers and fiscal agents for workers 

who provide long-term services and supports in the 

homes of such individuals; and 

(iv) addressing gaps in Federal and State infrastructure that prevent delivery of high-quality long 

term services and supports to such individuals. 

(3) ADDITIONAL CONSIDERATIONS.—For purposes of developing the plan described in paragraph (1), the Commission 

shall take into account projected demographic changes and 

trends in the population of the United States, as well as the 

potential for development of new technologies, delivery systems, 

or other mechanisms to improve the availability and quality 

of long-term services and supports. 

(4) CONSULTATION.—For purposes of developing the plan 

described in paragraph (1), the Commission shall consult with 

the Medicare Payment Advisory Commission, the Medicaid and 

CHIP Payment and Access Commission, the National Council 

on Disability, and relevant consumer groups. 

(c) MEMBERSHIP.— 

(1) IN GENERAL.—The Commission shall be composed of 

15 members, to be appointed not later than 30 days after 

the date of enactment of this Act, as follows: 

(A) The President of the United States shall appoint 

3 members. 

(B) The majority leader of the Senate shall appoint 

3 members. 

(C) The minority leader of the Senate shall appoint 

3 members. 

(D) The Speaker of the House of Representatives shall 

appoint 3 members. 

(E) The minority leader of the House of Representatives 

shall appoint 3 members. 

(2) REPRESENTATION.—The membership of the Commission 

shall include individuals who— 

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(A) represent the interests of— 

(i) consumers of long-term services and supports 

and related insurance products, as well as their representatives; 

(ii) older adults; 

(iii) individuals with cognitive or functional limitations; 

(iv) family caregivers for individuals described in 

clause (i), (ii), or (iii); 

(v) the health care workforce who directly provide 

long-term services and supports; 

(vi) private long-term care insurance providers; 

(vii) employers; 

(viii) State insurance departments; and 

(ix) State Medicaid agencies; 

(B) have demonstrated experience in dealing with 

issues related to long-term services and supports, health 

care policy, and public and private insurance; and 

(C) represent the health care interests and needs of 

a variety of geographic areas and demographic groups. 

(3) CHAIRMAN AND VICE-CHAIRMAN.—The Commission shall 

elect a chairman and vice chairman from among its members. 

(4) VACANCIES.—Any vacancy in the membership of the 

Commission shall be filled in the manner in which the original 

appointment was made and shall not affect the power of the 

remaining members to execute the duties of the Commission. 

(5) QUORUM.—A quorum shall consist of 8 members of 

the Commission, except that 4 members may conduct a hearing 

under subsection (e)(1). 

(6) MEETINGS.—The Commission shall meet at the call 

of its chairman or a majority of its members. 

(7) COMPENSATION AND REIMBURSEMENT OF EXPENSES.— 

(A) IN GENERAL.—To enable the Commission to exercise 

its powers, functions, and duties, there are authorized to 

be disbursed by the Senate the actual and necessary 

expenses of the Commission approved by the chairman 

and vice chairman, subject to subparagraph (B) and the 

rules and regulations of the Senate. 

(B) MEMBERS.—Members of the Commission are not 

entitled to receive compensation for service on the Commission. Members may be reimbursed for travel, subsistence, 

and other necessary expenses incurred in carrying out the 

duties of the Commission. 

(d) STAFF AND ETHICAL STANDARDS.— 

(1) STAFF.—The chairman and vice chairman of the 

Commission may jointly appoint and fix the compensation of 

staff as they deem necessary, within the guidelines for 

employees of the Senate and following all applicable rules and 

employment requirements of the Senate. 

(2) ETHICAL STANDARDS.—Members of the Commission who 

serve in the House of Representatives shall be governed by 

the ethics rules and requirements of the House. Members of 

the Senate who serve on the Commission and staff of the 

Commission shall comply with the ethics rules of the Senate. 

(e) POWERS.— (1) HEARINGS AND OTHER ACTIVITIES.—For the purpose of 

carrying out its duties, the Commission may hold such hearings 

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and undertake such other activities as the Commission determines to be necessary to carry out its duties. 

(2) STUDIES BY GENERAL ACCOUNTING OFFICE.—Upon the 

request of the Commission, the Comptroller General of the 

United States shall conduct such studies or investigations as 

the Commission determines to be necessary to carry out its 

duties. 

(3) COST ESTIMATES BY CONGRESSIONAL BUDGET OFFICE.— 

Upon the request of the Commission, the Director of the 

Congressional Budget Office shall provide to the Commission 

such cost estimates as the Commission determines to be necessary to carry out its duties. 

(4) DETAIL OF FEDERAL EMPLOYEES.—Upon the request of 

the Commission, the head of any Federal agency is authorized 

to detail, without reimbursement, any of the personnel of such 

agency to the Commission to assist the Commission in carrying 

out its duties. Any such detail shall not interrupt or otherwise 

affect the civil service status or privileges of the Federal 

employee. 

(5) TECHNICAL ASSISTANCE.—Upon the request of the 

Commission, the head of a Federal agency shall provide such 

technical assistance to the Commission as the Commission 

determines to be necessary to carry out its duties. 

(6) USE OF MAILS.—The Commission may use the United 

States mails in the same manner and under the same conditions 

as Federal agencies. 

(7) OBTAINING INFORMATION.—The Commission may secure 

directly from any Federal agency information necessary to 

enable it to carry out its duties, if the information may be 

disclosed under section 552 of title 5, United States Code. 

Upon request of the Chairman of the Commission, the head 

of such agency shall furnish such information to the Commission. 

(8) ADMINISTRATIVE SUPPORT SERVICES.—Upon the request 

of the Commission, the Administrator of General Services shall 

provide to the Commission on a reimbursable basis such 

administrative support services as the Commission may 

request. 

(f) COMMISSION CONSIDERATION.— 

(1) APPROVAL OF REPORT AND LEGISLATIVE LANGUAGE.— 

(A) IN GENERAL.—Not later than 6 months after 

appointment of the members of the Commission (as 

described in subsection (c)(1)), the Commission shall vote 

on a comprehensive and detailed report based on the longterm care plan described in subsection (b)(1) that contains 

any recommendations or proposals for legislative or 

administrative action as the Commission deems appropriate, including proposed legislative language to carry out 

the recommendations or proposals (referred to in this section as the ‘‘Commission bill’’). 

(B) APPROVAL BY MAJORITY OF MEMBERS.—The 

Commission bill shall require the approval of a majority 

of the members of the Commission. 

(2) TRANSMISSION OF COMMISSION BILL.— (A) IN GENERAL.—If the Commission bill is approved 

by the Commission pursuant to paragraph (1), then not 

later than 10 days after such approval, the Commission 

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shall submit the Commission bill to the President, the 

Vice President, the Speaker of the House of Representatives, and the majority and minority Leaders of each House 

on Congress. 

(B) COMMISSION BILL TO BE MADE PUBLIC.—Upon the 

approval or disapproval of the Commission bill pursuant 

to paragraph (1), the Commission shall promptly make 

such proposal, and a record of the vote, available to the 

public. 

(g) TERMINATION.—The Commission shall terminate 30 days 

after the vote described in subsection (f)(1). 

(h) CONSIDERATION OF COMMISSION RECOMMENDATIONS.—If 

approved by the majority required by subsection (f)(1), the Commission bill that has been submitted pursuant to subsection (f)(2)(A) 

shall be introduced in the Senate (by request) on the next day 

on which the Senate is in session by the majority leader of the 

Senate or by a Member of the Senate designated by the majority 

leader of the Senate and shall be introduced in the House of 

Representatives (by request) on the next legislative day by the 

majority leader of the House or by a member of the House designated by the majority leader of the House. 

SEC. 644. CONSUMER OPERATED AND ORIENTED PLAN PROGRAM 

CONTINGENCY FUND. 

(a) ESTABLISHMENT.—The Secretary of Health and Human 

Services shall establish a fund to be used to provide assistance 

and oversight to qualified nonprofit health insurance issuers that 

have been awarded loans or grants under section 1322 of the 

Patient Protection and Affordable Care Act (42 U.S.C. 18042) prior 

to the date of enactment of this Act. 

(b) TRANSFER AND RESCISSION.— (1) TRANSFER.—From the unobligated balance of funds 

appropriated under section 1322(g) of the Patient Protection 

and Affordable Care Act (42 U.S.C. 18042(g)), 10 percent of 

such sums are hereby transferred to the fund established under 

subsection (a) to remain available until expended. 

(2) RESCISSION.—Except as provided for in paragraph (1), 

amounts appropriated under section 1322(g) of the Patient 

Protection and Affordable Care Act (42 U.S.C. 18042(g)) that 

are unobligated as of the date of enactment of this Act are 

rescinded. 

TITLE VII—EXTENSION OF 

AGRICULTURAL PROGRAMS 

SEC. 701. 1-YEAR EXTENSION OF AGRICULTURAL PROGRAMS. 

(a) EXTENSION.—Except as otherwise provided in this section 

and amendments made by this section and notwithstanding any 

other provision of law, the authorities provided by each provision 

of the Food, Conservation, and Energy Act of 2008 (Public Law 

110–246; 122 Stat. 1651) and each amendment made by that Act 

(and for mandatory programs at such funding levels), as in effect 

on September 30, 2012, shall continue, and the Secretary of Agriculture shall carry out the authorities, until the later of— 

(1) September 30, 2013; or 

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(2) the date specified in the provision of that Act or amendment made by that Act. 

(b) COMMODITY PROGRAMS.— 

(1) IN GENERAL.—The terms and conditions applicable to 

a covered commodity or loan commodity (as those terms are 

defined in section 1001 of the Food, Conservation, and Energy 

Act of 2008 (7 U.S.C. 8702)) or to peanuts, sugarcane, or sugar 

beets for the 2012 crop year pursuant to title I of that Act 

(7 U.S.C. 8702 et seq.) and each amendment made by that 

title shall be applicable to the 2013 crop year for that covered 

commodity, loan commodity, peanuts, sugarcane, or sugar beets. 

(2) MILK.— 

(A) IN GENERAL.—Notwithstanding subsection (a), the 

Secretary of Agriculture shall carry out the dairy product 

price support program under section 1501 of the Food, 

Conservation, and Energy Act of 2008 (7 U.S.C. 8771) 

through December 31, 2013. 

(B) MILK INCOME LOSS CONTRACT PROGRAM.—Section 

1506 of the Food, Conservation, and Energy Act of 2008 

(7 U.S.C. 8773) is amended by striking ‘‘2012’’ each place 

it appears in subsections (c)(3), (d)(1), (d)(2), (e)(2)(A), (g), 

and (h)(1) and inserting ‘‘2013’’. 

(3) SUSPENSION OF PERMANENT PRICE SUPPORT AUTHORI- TIES.—The provisions of law specified in subsections (a) through 

(c) of section 1602 of the Food, Conservation, and Energy Act 

of 2008 (7 U.S.C. 8782) shall be suspended— 

(A) for the 2013 crop or production year of a covered 

commodity (as that term is defined in section 1001 of 

that Act (7 U.S.C. 8702)), peanuts, sugarcane, and sugar, 

as appropriate; and 

(B) in the case of milk, through December 31, 2013. 

(c) CONSERVATION PROGRAMS.— 

(1) CONSERVATION RESERVE.—Section 1231(d) of the Food 

Security Act of 1985 (16 U.S.C. 3831(d)) is amended in the 

second sentence by striking ‘‘and 2012’’ and inserting ‘‘2012, 

and 2013’’. 

(2) VOLUNTARY PUBLIC ACCESS.—Section 1240R of the Food 

Security Act of 1985 (16 U.S.C. 3839bb–5) is amended by 

striking subsection (f) and inserting the following: 

‘‘(f) FUNDING.— 

‘‘(1) FISCAL YEARS 2009 THROUGH 2012.—Of the funds of 

the Commodity Credit Corporation, the Secretary shall use 

to carry out this section, to the maximum extent practicable, 

$50,000,000 for the period of fiscal years 2009 through 2012. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this section $10,000,000 

for fiscal year 2013.’’. 

(d) SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM.— (1) EMPLOYMENT AND TRAINING PROGRAM.—Section 

16(h)(1)(A) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2025(h)(1)(A)) is amended by inserting ‘‘, except that for fiscal 

year 2013, the amount shall be $79,000,000’’ before the period 

at the end. 

(2) NUTRITION EDUCATION.—Section 28(d)(1) of the Food 

and Nutrition Act of 2008 (7 U.S.C. 2036a(d)(1)) is amended— 

(A) in subparagraph (A), by striking ‘‘and’’ after the 

semicolon at the end; and 

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(B) by striking subparagraph (B) and inserting the 

following: 

‘‘(B) for fiscal year 2012, $388,000,000; 

‘‘(C) for fiscal year 2013, $285,000,000; 

‘‘(D) for fiscal year 2014, $401,000,000; 

‘‘(E) for fiscal year 2015, $407,000,000; and 

‘‘(F) for fiscal year 2016 and each subsequent fiscal 

year, the applicable amount during the preceding fiscal 

year, as adjusted to reflect any increases for the 12-month 

period ending the preceding June 30 in the Consumer 

Price Index for All Urban Consumers published by the 

Bureau of Labor Statistics of the Department of Labor.’’. 

(e) RESEARCH PROGRAMS.— 

(1) ORGANIC AGRICULTURE RESEARCH AND EXTENSION INITIATIVE.—Section 1672B(f) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5925b(f)) is amended— 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘MANDATORY FUNDING FOR FISCAL

YEARS 2009 THROUGH 2012’’; 

(B) in the heading of paragraph (2), by striking ‘‘ADDITIONAL FUNDING’’ and inserting ‘‘DISCRETIONARY FUNDING

FOR FISCAL YEARS 2009 THROUGH 2012’’; and 

(C) by adding at the end the following: 

‘‘(3) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $25,000,000 for fiscal year 

2013.’’. 

(2) SPECIALTY CROP RESEARCH INITIATIVE.—Section 412(h) 

of the Agricultural Research, Extension, and Education Reform 

Act of 1998 (7 U.S.C. 7632(h)) is amended— 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘MANDATORY FUNDING FOR FISCAL

YEARS 2008 THROUGH 2012’’; 

(B) in the heading of paragraph (2), by inserting ‘‘FOR

FISCAL YEARS 2008 THROUGH 2012’’ after ‘‘APPROPRIATIONS’’; 

(C) by redesignating paragraphs (3) and (4) as paragraphs (4) and (5), respectively; and 

(D) by inserting after paragraph (2) the following: 

‘‘(3) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $100,000,000 for fiscal year 

2013.’’. 

(3) BEGINNING FARMER AND RANCHER DEVELOPMENT PROGRAM.—Section 7405(h) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 3319f(h)) is amended— 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘MANDATORY FUNDING FOR FISCAL

YEARS 2009 THROUGH 2012’’; 

(B) in the heading of paragraph (2), by inserting ‘‘FOR

FISCAL YEARS 2008 THROUGH 2012’’ after ‘‘APPROPRIATIONS’’; 

and 

(C) by adding at the end the following: 

‘‘(3) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $30,000,000 for fiscal year 

2013.’’. 

(f) ENERGY PROGRAMS.— 

(1) BIOBASED MARKETS PROGRAM.—Section 9002(h) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

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8102(h)) is amended in paragraph (2) by striking ‘‘2012’’ and 

inserting ‘‘2013’’. 

(2) BIOREFINERY ASSISTANCE.—Section 9003(h)(2) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8103(h)(2)) is amended by striking ‘‘2012’’ and inserting ‘‘2013’’. 

(3) REPOWERING ASSISTANCE.—Section 9004(d)(2) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8104(d)(2)) is amended by striking ‘‘2012’’ and inserting ‘‘2013’’. 

(4) BIOENERGY PROGRAM FOR ADVANCED BIOFUELS.—Section 

9005(g)(2) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 8105(g)(2)) is amended by striking ‘‘2012’’ 

and inserting ‘‘2013’’. 

(5) BIODIESEL FUEL EDUCATION PROGRAM.—Section 9006 

of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 8106) is amended by striking subsection (d) and inserting 

the following: 

‘‘(d) FUNDING.— 

‘‘(1) FISCAL YEARS 2009 THROUGH 2012.—Of the funds of 

the Commodity Credit Corporation, the Secretary shall use 

to carry out this section $1,000,000 for each of fiscal years 

2008 through 2012. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this section $1,000,000 

for fiscal year 2013.’’. 

(6) RURAL ENERGY FOR AMERICA PROGRAM.—Section 

9007(g)(3) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 8107(g)(3)) is amended by striking ‘‘2012’’ 

and inserting ‘‘2013’’. 

(7) BIOMASS RESEARCH AND DEVELOPMENT.—Section 

9008(h)(2) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 8108(h)(2)) is amended by striking ‘‘2012’’ 

and inserting ‘‘2013’’. 

(8) RURAL ENERGY SELF-SUFFICIENCY INITIATIVE.—Section 

9009(d) of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 8109(d)) is amended by striking ‘‘2012’’ and 

inserting ‘‘2013’’. 

(9) FEEDSTOCK FLEXIBILITY PROGRAM FOR BIOENERGY PRODUCERS.—Section 9010(b) of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 8110(b)) is amended in paragraphs (1)(A) and (2)(A) by striking ‘‘2012’’ each place it appears 

and inserting ‘‘2013’’. 

(10) BIOMASS CROP ASSISTANCE PROGRAM.—Section 9011(f) 

of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 8111(f)) is amended— 

(A) by striking ‘‘(f) FUNDING.—Of the funds’’ and 

inserting ‘‘(f) FUNDING.— 

‘‘(1) FISCAL YEARS 2008 THROUGH 2012.—Of the funds’’; and 

(B) adding at the end the following: 

‘‘(2) FISCAL YEAR 2013.— 

‘‘(A) IN GENERAL.—There is authorized to be appropriated to carry out this section $20,000,000 for fiscal year 

2013. 

‘‘(B) MULTIYEAR CONTRACTS.—For each multiyear contract entered into by the Secretary during a fiscal year 

under this paragraph, the Secretary shall ensure that sufficient funds are obligated from the amounts appropriated 

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for that fiscal year to fully cover all payments required 

by the contract for all years of the contract.’’. 

(11) FOREST BIOMASS FOR ENERGY.—Section 9012(d) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8112(d)) is amended by striking ‘‘2012’’ and inserting ‘‘2013’’. 

(12) COMMUNITY WOOD ENERGY PROGRAM.—Section 9013(e) 

of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 8113(e)) is amended by striking ‘‘2012’’ and inserting 

‘‘2013’’. 

(g) HORTICULTURE AND ORGANIC AGRICULTURE PROGRAMS.— (1) FARMERS MARKET PROMOTION PROGRAM.—Section 6(e) 

of the Farmer-to-Consumer Direct Marketing Act of 1976 (7 

U.S.C. 3005(e)) is amended— 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘FISCAL YEARS 2008 THROUGH 2012’’; 

(B) by redesignating paragraphs (2), (3), and (4) as 

paragraphs (3), (4), and (5), respectively; 

(C) by inserting after paragraph (1) the following: 

‘‘(2) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $10,000,000 for fiscal year 

2013.’’; 

(D) in paragraph (3) (as so redesignated), by striking 

‘‘paragraph (1)’’ and inserting ‘‘paragraph (1) or (2)’’; and 

(E) in paragraph (5) (as so redesignated), by striking 

‘‘paragraph (2)’’ and inserting ‘‘paragraph (3)’’. 

(2) NATIONAL CLEAN PLANT NETWORK.—Section 10202(e) 

of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 

7761(e)) is amended— 

(A) by striking ‘‘Of the funds’’ and inserting the following: 

‘‘(1) FISCAL YEARS 2009 THROUGH 2012.—Of the funds’’; and 

(B) by adding at the end the following: 

‘‘(2) FISCAL YEAR 2013.—There is authorized to be appro- priated to carry out the Program $5,000,000 for fiscal year 

2013.’’. 

(3) NATIONAL ORGANIC CERTIFICATION COST-SHARE PRO- GRAM.—Section 10606 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 6523) is amended— 

(A) in subsection (a), by striking ‘‘Of funds of the 

Commodity Credit Corporation, the Secretary of Agriculture (acting through the Agricultural Marketing Service) 

shall use $22,000,000 for fiscal year 2008, to remain available until expended, to’’ and inserting ‘‘The Secretary of 

Agriculture (acting through the Agricultural Marketing 

Service) shall’’; and 

(B) by adding at the end the following: 

‘‘(d) FUNDING.— ‘‘(1) MANDATORY FUNDING FOR FISCAL YEARS 2008 THROUGH

2012.—Of the funds of the Commodity Credit Corporation, the 

Secretary shall make available to carry out this section 

$22,000,000 for the period of fiscal years 2008 through 2012. 

‘‘(2) FISCAL YEAR 2013.—There is authorized to be appro- priated to carry out this section $22,000,000 for fiscal year 

2013, to remain available until expended.’’. 

(4) ORGANIC PRODUCTION AND MARKET DATA INITIATIVES.— Section 7407(d) of the Farm Security and Rural Investment 

Act of 2002 (7 U.S.C. 5925c(d)) is amended— 

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H. R. 8—55 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘MANDATORY FUNDING THROUGH

FISCAL YEAR 2012’’; 

(B) in the heading of paragraph (2), by striking ‘‘ADDITIONAL FUNDING’’ and inserting ‘‘DISCRETIONARY FUNDING

FOR FISCAL YEARS 2008 THROUGH 2012’’; and 

(C) by adding at the end the following: 

‘‘(3) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $5,000,000, to remain available 

until expended.’’. 

(h) OUTREACH AND TECHNICAL ASSISTANCE FOR SOCIALLY DISADVANTAGED FARMERS OR RANCHERS.—Section 2501(a)(4) of the 

Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 

2279(a)(4)) is amended— 

(1) in the heading of subparagraph (A), by striking ‘‘IN

GENERAL’’ and inserting ‘‘FISCAL YEARS 2009 THROUGH 2012’’; 

(2) by redesignating subparagraphs (B) and (C) as subparagraphs (C) and (D), respectively; 

(3) by inserting after subparagraph (A) the following: 

‘‘(B) FISCAL YEAR 2013.—There is authorized to be 

appropriated to carry out this section $20,000,000 for fiscal 

year 2013.’’; 

(4) in subparagraph (C) (as so redesignated), by striking 

‘‘subparagraph (A)’’ and inserting ‘‘subparagraph (A) or (B)’’; 

and 

(5) in subparagraph (D) (as so redesignated), by striking 

‘‘subparagraph (A)’’ and inserting ‘‘subparagraph (A) or (B)’’. 

(i) EXCEPTIONS.— (1) IN GENERAL.—Subsection (a) does not apply with respect 

to mandatory funding provided by programs authorized by 

provisions of law amended by subsections (d) through (h). 

(2) CONSERVATION.—Subsection (a) does not apply with 

respect to the programs specified in paragraphs (3)(B), (4), 

(6), and (7) of section 1241(a) of the Food Security Act of 

1985 (16 U.S.C. 3841(a)), relating to the conservation stewardship program, farmland protection program, environmental 

quality incentives program, and wildlife habitat incentives program, for which program authority was extended through fiscal 

year 2014 by section 716 of Public Law 112–55 (125 Stat. 

582). 

(3) TRADE.—Subsection (a) does not apply with respect 

to the following provisions of law: 

(A) Section 3206 of the Food, Conservation, and Energy 

Act of 2008 (7 U.S.C. 1726c) relating to the use of Commodity Credit Corporation funds to support local and 

regional food aid procurement projects. 

(B) Section 3107(l)(1) of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 1736o–1(l)(1)) relating 

to the use of Commodity Credit Corporation funds to carry 

out the McGovern-Dole International Food for Education 

and Child Nutrition Program. 

(4) SURVEY OF FOODS PURCHASED BY SCHOOL FOOD AUTHORITIES.—Subsection (a) does not apply with respect to section 

4307 of the Food, Conservation, and Energy Act of 2008 (Public 

Law 110–246; 122 Stat. 1893) relating to the use of Commodity 

Credit Corporation funds for a survey and report regarding 

foods purchased by school food authorities. 

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(5) RURAL DEVELOPMENT.—Subsection (a) does not apply 

with respect to the following provisions of law: 

(A) Section 379E(d)(1) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 2008s(d)(1)), relating to 

funding of the rural microentrepreneur assistance program. 

(B) Section 6029 of the Food, Conservation, and Energy 

Act of 2008 (Public Law 110–246; 122 Stat. 1955) relating 

to funding of pending rural development loan and grant 

applications. 

(C) Section 231(b)(7)(A) of the Agricultural Risk Protection Act of 2000 (7 U.S.C. 1632a(b)(7)(A)), relating to 

funding of value-added agricultural market development 

program grants. 

(D) Section 375(e)(6)(B) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 2008j(e)(6)(B)) relating 

to the use of Commodity Credit Corporation funds for the 

National Sheep Industry Improvement Center. 

(6) MARKET LOSS ASSISTANCE FOR ASPARAGUS PRODUCERS.— 

Subsection (a) does not apply with respect to section 10404(d) 

of the Food, Conservation, and Energy Act of 2008 (Public 

Law 110–246; 122 Stat. 2112). 

(7) SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE.— 

Subsection (a) does not apply with respect to section 531 of 

the Federal Crop Insurance Act (7 U.S.C. 1531) and title IX 

of the Trade Act of 1974 (19 U.S.C. 2497 et seq.) relating 

to the provision of supplemental agricultural disaster assistance. 

(8) PIGFORD CLAIMS.—Subsection (a) does not apply with 

respect to section 14012 of the Food, Conservation, and Energy 

Act of 2008 (Public Law 110–246; 122 Stat. 2209) relating 

to determination on the merits of Pigford claims. 

(9) HEARTLAND, HABITAT, HARVEST, AND HORTICULTURE ACT

OF 2008.—Subsection (a) does not apply with respect to title 

XV of the Food, Conservation, and Energy Act of 2008 (Public 

Law 110–246; 122 Stat. 2246), and amendments made by that 

title, relating to the provision of supplemental agricultural disaster assistance under title IX of the Trade Act of 1974 (19 

U.S.C. 2497 et seq.), certain revenue and tax provisions, and 

certain trade benefits and other matters. 

(j) EFFECTIVE DATE.—Except as otherwise provided in this section, this section and the amendments made by this section take 

effect on the earlier of— 

(1) the date of the enactment of this Act; or 

(2) September 30, 2012. 

SEC. 702. SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE. 

(a) IN GENERAL.—Section 531 of the Federal Crop Insurance 

Act (7 U.S.C. 1531) is amended— 

(1) in subsection (a)(5)— 

(A) in the matter preceding clause (i), by striking the 

first ‘‘under’’; and 

(B) by redesignating clauses (i) through (iii) as subparagraphs (A), (B), and (C), respectively, and indenting appropriately; 

(2) in subsection (c)— 

(A) in paragraph (1), by striking ‘‘use such sums as 

are necessary from the Trust Fund to’’; and 

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H. R. 8—57 

(B) by adding at the end the following: 

‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $80,000,000 

for each of fiscal years 2012 and 2013.’’; 

(3) in subsection (d)— 

(A) in paragraph (2), by striking ‘‘use such sums as 

are necessary from the Trust Fund to’’; and 

(B) by adding at the end the following: 

‘‘(7) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection 

$400,000,000 for each of fiscal years 2012 and 2013.’’; 

(4) in subsection (e)— 

(A) in paragraph (1), by striking ‘‘use up to $50,000,000 

per year from the Trust Fund to’’; and 

(B) by adding at the end the following: 

‘‘(4) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $50,000,000 

for each of fiscal years 2012 and 2013.’’; 

(5) in subsection (f)— 

(A) in paragraph (2)(A), by striking ‘‘use such sums 

as are necessary from the Trust Fund to’’; and 

(B) by adding at the end the following: 

‘‘(5) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $20,000,000 

for each of fiscal years 2012 and 2013.’’; and 

(6) in subsection (i), by inserting ‘‘or, in the case of subsections (c) through (f), September 30, 2013’’ after ‘‘2011,’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall take effect on October 1, 2012. 

TITLE VIII—MISCELLANEOUS 

PROVISIONS 

SEC. 801. STRATEGIC DELIVERY SYSTEMS. 

(a) IN GENERAL.—Paragraph 3 of section 495(c) of title 10, 

United States Code,, as added by section 1035 of the National 

Defense Authorization Act for Fiscal Year 2013, is amended— 

(1) by striking ‘‘that’’ before ‘‘the Russian Federation’’ and 

inserting ‘‘whether’’; and 

(2) by inserting ‘‘strategic’’ before ‘‘arms control obligations’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall take effect as if included in the enactment of the National 

Defense Authorization Act for Fiscal Year 2013. 

SEC. 802. NO COST OF LIVING ADJUSTMENT IN PAY OF MEMBERS 

OF CONGRESS. 

Notwithstanding any other provision of law, no adjustment 

shall be made under section 601(a) of the Legislative Reorganization 

Act of 1946 (2 U.S.C. 31) (relating to cost of living adjustments 

for Members of Congress) during fiscal year 2013. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 357
H. R. 8—58 

TITLE IX—BUDGET PROVISIONS 

Subtitle A—Modifications of Sequestration 

SEC. 901. TREATMENT OF SEQUESTER. 

(a) ADJUSTMENT.—Section 251A(3) of the Balanced Budget and 

Emergency Deficit Control Act of 1985 is amended— 

(1) in subparagraph (C), by striking ‘‘and’’ after the semicolon; 

(2) in subparagraph (D), by striking the period and 

inserting‘‘ ; and’’; and 

(3) by inserting at the end the following: 

‘‘(E) for fiscal year 2013, reducing the amount calculated under subparagraphs (A) through (D) by 

$24,000,000,000.’’. 

(b) AFTER SESSION SEQUESTER.—Notwithstanding any other 

provision of law, the fiscal year 2013 spending reductions required 

by section 251(a)(1) of the Balanced Budget and Emergency Deficit 

Control Act of 1985 shall be evaluated and implemented on March 

27, 2013. 

(c) POSTPONEMENT OF BUDGET CONTROL ACT SEQUESTER FOR

FISCAL YEAR 2013.—Section 251A of the Balanced Budget and 

Emergency Deficit Control Act of 1985 is amended— 

(1) in paragraph (4), by striking ‘‘January 2, 2013’’ and 

inserting ‘‘March 1, 2013’’; and 

(2) in paragraph (7)(A), by striking ‘‘January 2, 2013’’ and 

inserting ‘‘March 1, 2013’’. 

(d) ADDITIONAL ADJUSTMENTS.— 

(1) SECTION 251.—Paragraphs (2) and (3) of section 251(c) 

of the Balanced Budget and Emergency Deficit Control Act 

of 1985 are amended to read as follows: 

‘‘(2) for fiscal year 2013— 

‘‘(A) for the security category, as defined in section 

250(c)(4)(B), $684,000,000,000 in budget authority; and 

‘‘(B) for the nonsecurity category, as defined in section 

250(c)(4)(A), $359,000,000,000 in budget authority; 

‘‘(3) for fiscal year 2014— 

‘‘(A) for the security category, $552,000,000,000 in 

budget authority; and 

‘‘(B) for the nonsecurity category, $506,000,000,000 in 

budget authority;’’. 

(e) 2013 SEQUESTER.—On March 1, 2013, the President shall 

order a sequestration for fiscal year 2013 pursuant to section 251A 

of the Balanced Budget and Emergency Deficit Control Act of 1985, 

as amended by this section, pursuant to which, only for the purposes 

of the calculation in sections 251A(5)(A), 251A(6)(A), and 251A(7)(A), 

section 251(c)(2) shall be applied as if it read as follows: 

‘‘(2) For fiscal year 2013— 

‘‘(A) for the security category, $544,000,000,000 in 

budget authority; and 

‘‘(B) for the nonsecurity category, $499,000,000,000 in 

budget authority;’’. 

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H. R. 8—59 

SEC. 902. AMOUNTS IN APPLICABLE RETIREMENT PLANS MAY BE 

TRANSFERRED TO DESIGNATED ROTH ACCOUNTS WITHOUT DISTRIBUTION. 

(a) IN GENERAL.—Section 402A(c)(4) is amended by adding 

at the end the following: 

‘‘(E) SPECIAL RULE FOR CERTAIN TRANSFERS.—In the 

case of an applicable retirement plan which includes a 

qualified Roth contribution program— 

‘‘(i) the plan may allow an individual to elect to 

have the plan transfer any amount not otherwise 

distributable under the plan to a designated Roth 

account maintained for the benefit of the individual, 

‘‘(ii) such transfer shall be treated as a distribution 

to which this paragraph applies which was contributed 

in a qualified rollover contribution (within the meaning 

of section 408A(e)) to such account, and 

‘‘(iii) the plan shall not be treated as violating 

the provisions of section 401(k)(2)(B)(i), 403(b)(7)(A)(i), 

403(b)(11), or 457(d)(1)(A), or of section 8433 of title 

5, United States Code, solely by reason of such 

transfer.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to transfers after December 31, 2012, in taxable years 

ending after such date. 

Subtitle B—Budgetary Effects 

SEC. 911. BUDGETARY EFFECTS. 

(a) PAYGO SCORECARD.—The budgetary effects of this Act shall 

not be entered on either PAYGO scorecard maintained pursuant 

to section 4(d) of the Statutory Pay-As-You-Go Act of 2010. 

(b) SENATE PAYGO SCORECARD.—The budgetary effects of this 

Act shall not be entered on any PAYGO scorecard maintained 

for purposes of section 201 of S. Con. Res. 21 (110th Congress). 

Speaker of the House of Representatives. 

Vice President of the United States and

President of the Senate. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 359
Department of the Navy Administrative Record for FY 2013 Furlough Appeals 360
SECRETARY OF DEFENSE 

1000 DEFENSE PENTAGON 

WASHINGTON. DC 20301·1000 

MEMORANDUM FOR: SEE DISTR1BUTION 

SUBJECT: Implications of Ongoing Fiscal Cliff Negotiations 

DEC 2 0 2012 

We are providing you Ibis infonnation regarding the porential Impact of seqUestration 

here at DoD. As you are all likely aware, the Administration and Congress are continuing to 

work to resolve a series of economic or fiscal events, collectively referred to as the "fiscal cliff," 

that are scheduled to oocur around the end of the year. One of the key issues involves porential 

acrosg...the-board reductions in Federal spending-also known as "sequestration"-which were 

put in place by the Budget Control Act of 20 I !. Under current law, these reductions are 

scheduled to take effect on January 2, 2013. Many of you have raised questions regarding the 

impact of a potential sequestration fur the Department of Defense, and I would like to take a 

moment to clarify a few things. 

I want to start by noting that titis past summer, the President indicated his intent to 

exercise his legal authority to exempt military personnel funding from sequestration. This means 

that military endatrength will not be affected by sequestration in FY2013. 

Our civilian employees should keep in mind that the Adminisumion remains focused on 

working with Congress to reach agreement on a balanced deficit reduction pian that avoids such 

cuts. Sequestration was never intended to be implemented, and there is no reason why both sides 

should not be able to come togethar and prevent titis scenario. 

Nevertheless, with only a coople of weeks left before sequestration could occur should a 

deal not be reuched, it is important to clarifY the potential implications. Let me start by 

explaining what sequestration is and what it is not. Sequestration is an across-the-beard 

reduction in budgetary resources for all acconnts within the Department of Defense that have not 

been exempted by Congress. If it occurs, sequestration will reduoe our budgetary resources for 

the remainder of the fiscal year (which runs through Seplember 30). These cuts, while 

significant and harmful to our collective mission as an agency, would not neCessarily require 

immediate reductions in spending. Under sequestration, we would still have funds available 

after January 2, 2013, but our overall funding for the remainder of the year would be reduced. 

Accordingly. this situation is different from other scenarios we have encountered in recent years. 

such as threats of government shutdown due to a lapse in-appropriations. 

For these reasons. I do not expect our day~to~ay operations to change dramatically on or 

immediately after January 2, 2013, should sequestration occur. This means that we will not be 

executing any immediate civilian personnel actions. such as furloughs. on that date. Should we 

have to operate tmder reduced funding levels for an extended period of time, we may have to 

consider furloughs or other actions in the future. But let me assure you that we will carefully 

examine other options to reduce costs within the agency before taking such action. taking into 

080015618-12 

ftf=Af!- tioWiar IJ T'Jb 2 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 361
consideration our obligation to execute our core mission. Moreover, if such action proves 10 be 

necessary, we would provide affected employees the requisite advance notice before a furlough 

or other personnel action would occur. We would also immediately cancel any scheduled 

personnel actions should a deficit reduction agreement be reached that restores our agency 

funding. 

I want to assure you that we wi11 do our very best to provide clear information about the 

status of events as they unfold. 

Finally, let me express my gratitude during this holiday season for your continued hard 

work and dedication to the vital mission of the Department of Defense. Your co-ntributions touch 

people~s lives in many significant ways. and I want you to know how deeply appreciative the 

President and myself are for all that you do. 

DISTRIBUTION: 

SECRETARIES OF lHE MILITARY DEPARTMENTS 

CHAIRMAN OF lHE JOINT CHIEFS OF STAFF 

UNDER SECRETARIES OF DEFENSE 

DEPUTY CHIEF MANAGEMENT OFFICER 

COMMANDERS OF lHE COMBATANT COMMANDS 

DIRECTOR, COST ASSESSMENT AND PROGRAM EVALUATION 

DIRECTOR, OPERATIONAL TEST AND EVALUATION 

GENERAL COUNSEL OF THE DEPARTMENT OF DEFENSE 

INSPECTOR GENERAL OF lHE DEPARTMENT OF DEFENSE 

ASSISTANT SECRETARIES OF DEFENSE 

DEPARTMENT OF DEFENSE CHIEF INFORMATION OFFICER 

ASSISTANTS TO THE SECRETARY OF DEFENSE 

DIRECTOR, ADMINISTRATION AND MANAGEMENT 

DIRECTOR, NET ASSESSMENT 

DIRECTORS OF lHE DEFENSE AGENCIES 

DIRECTORS OF THE DOD FIELD ACTIVITIES 

2 

. ' .. ~. ' ' ·l-:· -l- ·-~ 

' ' 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 362
DEPUTY SECRETARY OF DEFENSE 

1010 DEFENSE PENTAGON 

. WASHINGTON, DC 20301·1010 

MEMORANDUM FOR: SEE DISTRIBUTION 

SUBJECT: Guidance on Fiscal Year 2013 Joint Committee Sequestration 

SEP 2 5 2012 

The Budget Control Act of2011 (BCA) established the Joint Select Committee on 

Deficit Reduction (Joint Committee) and charged it with developing a proposal that would 

achieve at least $1.2 trillion in deficit reduction. Last November, the Joint Committee 

announced that it could not reach agreement on a deficit reduction plan. This failure triggered an 

enforcement mechanism of automatic funding cuts in Fiscal Year (FY) 2013, known as 

sequestration, above and beyond the reductions already reflected in the FY 2013 budget the 

Department submitted in February. The law requires the President to issue a sequestration order 

on January 2, 2013, to implement the required cuts unless Congress acts to avoid it. 

The additional funding cuts required under the BCA are very large. A recent report by 

the Office of Management and Budget (OMB) estimates that the cuts in the Department of 

Defense (DoD) budget would exceed $50 billion in FY 2013 alone. The law further requires that 

the FY 2013 cuts be implemented in an indiscriminate, across-the-board manner that will greatly 

exacerbate their adverse effects. These large cuts would lead to devastating effects on the 

Department and virtually every other Federal agency. For this reason, the Administration 

strongly believes that Congress needs to act to avoid sequestration by passing a balanced deficit 

reduction package that the President can sign. 

If Congress fails to enact balanced deficit reduction and avoid sequestration, DoD and 

other affected agencies must be prepared, under the BCA, to implement sequestration on January 

2, 2013. On July 31, 2012, OMB issued the attached guidance informing agencies that OMB 

will be consulting with them on matters related to the issuance of the sequestration order. Over 

the longer term, in the absence of congressional action on a balanced deficit reduction plan in 

advance of January 2, 2013, OMB will undertake additional activities related to the 

implementation ofthe sequestration. Within DoD, the Under Secretary of Defense (Comptroller) 

will take the lead in these efforts and, working with OMB as necessary, will ensure that the 

Department is ready to implement sequestration in January if it occurs. 

080011885-12 

II II 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 363
PUBLIC LAW 112–25—AUG. 2, 2011 

BUDGET CONTROL ACT OF 2011 


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125 STAT. 240 PUBLIC LAW 112–25—AUG. 2, 2011 

Public Law 112–25 

112th Congress 

An Act 

To provide for budget control. 

Be it enacted by the Senate and House of Representatives of 

the United States of America in Congress assembled, 

SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

(a) SHORT TITLE.—This Act may be cited as the ‘‘Budget Control 

Act of 2011’’. 

(b) TABLE OF CONTENTS.—The table of contents for this Act 

is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Severability. 

TITLE I—TEN-YEAR DISCRETIONARY CAPS WITH SEQUESTER 

Sec. 101. Enforcing discretionary spending limits. 

Sec. 102. Definitions. 

Sec. 103. Reports and orders. 

Sec. 104. Expiration. 

Sec. 105. Amendments to the Congressional Budget and Impoundment Control Act 

of 1974. 

Sec. 106. Senate budget enforcement. 

TITLE II—VOTE ON THE BALANCED BUDGET AMENDMENT 

Sec. 201. Vote on the balanced budget amendment. 

Sec. 202. Consideration by the other House. 

TITLE III—DEBT CEILING DISAPPROVAL PROCESS 

Sec. 301. Debt ceiling disapproval process. 

Sec. 302. Enforcement of budget goal. 

TITLE IV—JOINT SELECT COMMITTEE ON DEFICIT REDUCTION 

Sec. 401. Establishment of Joint Select Committee. 

Sec. 402. Expedited consideration of joint committee recommendations. 

Sec. 403. Funding. 

Sec. 404. Rulemaking. 

TITLE V—PELL GRANT AND STUDENT LOAN PROGRAM CHANGES 

Sec. 501. Federal Pell grants. 

Sec. 502. Termination of authority to make interest subsidized loans to graduate 

and professional students. 

Sec. 503. Termination of direct loan repayment incentives. 

Sec. 504. Inapplicability of title IV negotiated rulemaking and master calendar exception. 

SEC. 2. SEVERABILITY. 

If any provision of this Act, or any application of such provision 

to any person or circumstance, is held to be unconstitutional, the 

remainder of this Act and the application of this Act to any other 

person or circumstance shall not be affected. 

2 USC 900 note. 

2 USC 900 note. 

Budget Control 

Act of 2011. 

Aug. 2, 2011 

[S. 365] 


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PUBLIC LAW 112–25—AUG. 2, 2011 125 STAT. 241 

TITLE I—TEN-YEAR DISCRETIONARY 

CAPS WITH SEQUESTER 

SEC. 101. ENFORCING DISCRETIONARY SPENDING LIMITS. 

Section 251 of the Balanced Budget and Emergency Deficit 

Control Act of 1985 is amended to read as follows: 

‘‘SEC. 251. ENFORCING DISCRETIONARY SPENDING LIMITS. 

‘‘(a) ENFORCEMENT.— ‘‘(1) SEQUESTRATION.—Within 15 calendar days after Congress adjourns to end a session there shall be a sequestration 

to eliminate a budget-year breach, if any, within any category. 

‘‘(2) ELIMINATING A BREACH.—Each non-exempt account 

within a category shall be reduced by a dollar amount calculated 

by multiplying the enacted level of sequestrable budgetary 

resources in that account at that time by the uniform percentage necessary to eliminate a breach within that category. 

‘‘(3) MILITARY PERSONNEL.—If the President uses the 

authority to exempt any personnel account from sequestration 

under section 255(f), each account within subfunctional category 

051 (other than those military personnel accounts for which 

the authority provided under section 255(f) has been exercised) 

shall be further reduced by a dollar amount calculated by 

multiplying the enacted level of non-exempt budgetary 

resources in that account at that time by the uniform percentage necessary to offset the total dollar amount by which outlays 

are not reduced in military personnel accounts by reason of 

the use of such authority. 

‘‘(4) PART-YEAR APPROPRIATIONS.—If, on the date specified 

in paragraph (1), there is in effect an Act making or continuing 

appropriations for part of a fiscal year for any budget account, 

then the dollar sequestration calculated for that account under 

paragraphs (2) and (3) shall be subtracted from— 

‘‘(A) the annualized amount otherwise available by law 

in that account under that or a subsequent part-year appropriation; and 

‘‘(B) when a full-year appropriation for that account 

is enacted, from the amount otherwise provided by the 

full-year appropriation for that account. 

‘‘(5) LOOK-BACK.—If, after June 30, an appropriation for 

the fiscal year in progress is enacted that causes a breach 

within a category for that year (after taking into account any 

sequestration of amounts within that category), the discretionary spending limits for that category for the next fiscal 

year shall be reduced by the amount or amounts of that breach. 

‘‘(6) WITHIN-SESSION SEQUESTRATION.—If an appropriation 

for a fiscal year in progress is enacted (after Congress adjourns 

to end the session for that budget year and before July 1 

of that fiscal year) that causes a breach within a category 

for that year (after taking into account any prior sequestration 

of amounts within that category), 15 days later there shall 

be a sequestration to eliminate that breach within that category 

following the procedures set forth in paragraphs (2) through 

(4). 

‘‘(7) ESTIMATES.— 

Deadline. 

Deadline. 

2 USC 901. 


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125 STAT. 242 PUBLIC LAW 112–25—AUG. 2, 2011 

‘‘(A) CBO ESTIMATES.—As soon as practicable after 

Congress completes action on any discretionary appropriation, CBO, after consultation with the Committees on the 

Budget of the House of Representatives and the Senate, 

shall provide OMB with an estimate of the amount of 

discretionary new budget authority and outlays for the 

current year, if any, and the budget year provided by 

that legislation. 

‘‘(B) OMB ESTIMATES AND EXPLANATION OF DIF- FERENCES.—Not later than 7 calendar days (excluding 

Saturdays, Sundays, and legal holidays) after the date 

of enactment of any discretionary appropriation, OMB shall 

transmit a report to the House of Representatives and 

to the Senate containing the CBO estimate of that legislation, an OMB estimate of the amount of discretionary new 

budget authority and outlays for the current year, if any, 

and the budget year provided by that legislation, and an 

explanation of any difference between the 2 estimates. 

If during the preparation of the report OMB determines 

that there is a significant difference between OMB and 

CBO, OMB shall consult with the Committees on the 

Budget of the House of Representatives and the Senate 

regarding that difference and that consultation shall 

include, to the extent practicable, written communication 

to those committees that affords such committees the opportunity to comment before the issuance of the report. 

‘‘(C) ASSUMPTIONS AND GUIDELINES.—OMB estimates 

under this paragraph shall be made using current economic 

and technical assumptions. OMB shall use the OMB estimates transmitted to the Congress under this paragraph. 

OMB and CBO shall prepare estimates under this paragraph in conformance with scorekeeping guidelines determined after consultation among the Committees on the 

Budget of the House of Representatives and the Senate, 

CBO, and OMB. 

‘‘(D) ANNUAL APPROPRIATIONS.—For purposes of this 

paragraph, amounts provided by annual appropriations 

shall include any discretionary appropriations for the current year, if any, and the budget year in accounts for 

which funding is provided in that legislation that result 

from previously enacted legislation. 

‘‘(b) ADJUSTMENTS TO DISCRETIONARY SPENDING LIMITS.— 

‘‘(1) CONCEPTS AND DEFINITIONS.—When the President submits the budget under section 1105 of title 31, United States 

Code, OMB shall calculate and the budget shall include adjustments to discretionary spending limits (and those limits as 

cumulatively adjusted) for the budget year and each outyear 

to reflect changes in concepts and definitions. Such changes 

shall equal the baseline levels of new budget authority and 

outlays using up-to-date concepts and definitions, minus those 

levels using the concepts and definitions in effect before such 

changes. Such changes may only be made after consultation 

with the Committees on Appropriations and the Budget of 

the House of Representatives and the Senate, and that consultation shall include written communication to such committees 

that affords such committees the opportunity to comment before 

official action is taken with respect to such changes. 

Consultation. 

Deadline. 

Reports. 


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‘‘(2) SEQUESTRATION REPORTS.—When OMB submits a 

sequestration report under section 254(e), (f), or (g) for a fiscal 

year, OMB shall calculate, and the sequestration report and 

subsequent budgets submitted by the President under section 

1105(a) of title 31, United States Code, shall include adjustments to discretionary spending limits (and those limits as 

adjusted) for the fiscal year and each succeeding year, as follows: 

‘‘(A) EMERGENCY APPROPRIATIONS; OVERSEAS CONTIN- GENCY OPERATIONS/GLOBAL WAR ON TERRORISM.—If, for any 

fiscal year, appropriations for discretionary accounts are 

enacted that— 

‘‘(i) the Congress designates as emergency requirements in statute on an account by account basis and 

the President subsequently so designates, or 

‘‘(ii) the Congress designates for Overseas Contingency Operations/Global War on Terrorism in statute 

on an account by account basis and the President 

subsequently so designates, 

the adjustment shall be the total of such appropriations 

in discretionary accounts designated as emergency requirements or for Overseas Contingency Operations/Global War 

on Terrorism, as applicable. 

‘‘(B) CONTINUING DISABILITY REVIEWS AND REDETERMINATIONS.—(i) If a bill or joint resolution making appropriations for a fiscal year is enacted that specifies an 

amount for continuing disability reviews under titles II 

and XVI of the Social Security Act and for the cost associated with conducting redeterminations of eligibility under 

title XVI of the Social Security Act, then the adjustments 

for that fiscal year shall be the additional new budget 

authority provided in that Act for such expenses for that 

fiscal year, but shall not exceed— 

‘‘(I) for fiscal year 2012, $623,000,000 in additional 

new budget authority; ‘‘(II) for fiscal year 2013, $751,000,000 in additional 

new budget authority; 

‘‘(III) for fiscal year 2014, $924,000,000 in additional new budget authority; 

‘‘(IV) for fiscal year 2015, $1,123,000,000 in additional new budget authority; 

‘‘(V) for fiscal year 2016, $1,166,000,000 in additional new budget authority; 

‘‘(VI) for fiscal year 2017, $1,309,000,000 in additional new budget authority; 

‘‘(VII) for fiscal year 2018, $1,309,000,000 in additional new budget authority; 

‘‘(VIII) for fiscal year 2019, $1,309,000,000 in additional new budget authority; 

‘‘(IX) for fiscal year 2020, $1,309,000,000 in additional new budget authority; and 

‘‘(X) for fiscal year 2021, $1,309,000,000 in additional new budget authority. 

‘‘(ii) As used in this subparagraph— 

‘‘(I) the term ‘continuing disability reviews’ means 

continuing disability reviews under sections 221(i) and 

1614(a)(4) of the Social Security Act; 

Definitions. 


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‘‘(II) the term ‘redetermination’ means redetermination of eligibility under sections 1611(c)(1) and 

1614(a)(3)(H) of the Social Security Act; and 

‘‘(III) the term ‘additional new budget authority’ 

means the amount provided for a fiscal year, in excess 

of $273,000,000, in an appropriation Act and specified 

to pay for the costs of continuing disability reviews 

and redeterminations under the heading ‘Limitation 

on Administrative Expenses’ for the Social Security 

Administration. 

‘‘(C) HEALTH CARE FRAUD AND ABUSE CONTROL.—(i) 

If a bill or joint resolution making appropriations for a 

fiscal year is enacted that specifies an amount for the 

health care fraud abuse control program at the Department 

of Health and Human Services (75–8393–0–7–571), then 

the adjustments for that fiscal year shall be the amount 

of additional new budget authority provided in that Act 

for such program for that fiscal year, but shall not exceed— ‘‘(I) for fiscal year 2012, $270,000,000 in additional 

new budget authority; ‘‘(II) for fiscal year 2013, $299,000,000 in additional 

new budget authority; ‘‘(III) for fiscal year 2014, $329,000,000 in additional new budget authority; ‘‘(IV) for fiscal year 2015, $361,000,000 in additional new budget authority; ‘‘(V) for fiscal year 2016, $395,000,000 in additional 

new budget authority; 

‘‘(VI) for fiscal year 2017, $414,000,000 in additional new budget authority; 

‘‘(VII) for fiscal year 2018, $434,000,000 in additional new budget authority; 

‘‘(VIII) for fiscal year 2019, $454,000,000 in additional new budget authority; 

‘‘(IX) for fiscal year 2020, $475,000,000 in additional new budget authority; and 

‘‘(X) for fiscal year 2021, $496,000,000 in additional 

new budget authority. 

‘‘(ii) As used in this subparagraph, the term ‘additional 

new budget authority’ means the amount provided for a 

fiscal year, in excess of $311,000,000, in an appropriation 

Act and specified to pay for the costs of the health care 

fraud and abuse control program. 

‘‘(D) DISASTER FUNDING.— 

‘‘(i) If, for fiscal years 2012 through 2021, appropriations for discretionary accounts are enacted that 

Congress designates as being for disaster relief in 

statute, the adjustment for a fiscal year shall be the 

total of such appropriations for the fiscal year in discretionary accounts designated as being for disaster relief, 

but not to exceed the total of— 

‘‘(I) the average funding provided for disaster 

relief over the previous 10 years, excluding the 

highest and lowest years; and 

‘‘(II) the amount, for years when the enacted 

new discretionary budget authority designated as 

being for disaster relief for the preceding fiscal 

Definition. 


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year was less than the average as calculated in 

subclause (I) for that fiscal year, that is the difference between the enacted amount and the allowable adjustment as calculated in such subclause 

for that fiscal year. 

‘‘(ii) OMB shall report to the Committees on Appropriations and Budget in each House the average calculated pursuant to clause (i)(II), not later than 30 

days after the date of the enactment of the Budget 

Control Act of 2011. 

‘‘(iii) For the purposes of this subparagraph, the 

term ‘disaster relief’ means activities carried out pursuant to a determination under section 102(2) of the 

Robert T. Stafford Disaster Relief and Emergency 

Assistance Act (42 U.S.C. 5122(2)). 

‘‘(iv) Appropriations considered disaster relief 

under this subparagraph in a fiscal year shall not 

be eligible for adjustments under subparagraph (A) 

for the fiscal year. 

‘‘(c) DISCRETIONARY SPENDING LIMIT.—As used in this part, 

the term ‘discretionary spending limit’ means— 

‘‘(1) with respect to fiscal year 2012— 

‘‘(A) for the security category, $684,000,000,000 in new 

budget authority; and 

‘‘(B) for the nonsecurity category, $359,000,000,000 in 

new budget authority; 

‘‘(2) with respect to fiscal year 2013— 

‘‘(A) for the security category, $686,000,000,000 in new 

budget authority; and 

‘‘(B) for the nonsecurity category, $361,000,000,000 in 

new budget authority; 

‘‘(3) with respect to fiscal year 2014, for the discretionary 

category, $1,066,000,000,000 in new budget authority; 

‘‘(4) with respect to fiscal year 2015, for the discretionary 

category, $1,086,000,000,000 in new budget authority; 

‘‘(5) with respect to fiscal year 2016, for the discretionary 

category, $1,107,000,000,000 in new budget authority; 

‘‘(6) with respect to fiscal year 2017, for the discretionary 

category, $1,131,000,000,000 in new budget authority; 

‘‘(7) with respect to fiscal year 2018, for the discretionary 

category, $1,156,000,000,000 in new budget authority; 

‘‘(8) with respect to fiscal year 2019, for the discretionary 

category, $1,182,000,000,000 in new budget authority; 

‘‘(9) with respect to fiscal year 2020, for the discretionary 

category, $1,208,000,000,000 in new budget authority; and 

‘‘(10) with respect to fiscal year 2021, for the discretionary 

category, $1,234,000,000,000 in new budget authority; 

as adjusted in strict conformance with subsection (b).’’. 

SEC. 102. DEFINITIONS. 

Section 250(c) of the Balanced Budget and Emergency Deficit 

Control Act of 1985 is amended as follows: 

(1) Strike paragraph (4) and insert the following new paragraph: 

‘‘(4)(A) The term ‘nonsecurity category’ means all discretionary appropriations not included in the security category 

defined in subparagraph (B). 

2 USC 900. 

Definition. 

Definition. 


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‘‘(B) The term ‘security category’ includes discretionary 

appropriations associated with agency budgets for the Department of Defense, the Department of Homeland Security, the 

Department of Veterans Affairs, the National Nuclear Security 

Administration, the intelligence community management 

account (95–0401–0–1–054), and all budget accounts in budget 

function 150 (international affairs). 

‘‘(C) The term ‘discretionary category’ includes all discretionary appropriations.’’. 

(2) In paragraph (8)(C), strike ‘‘the food stamp program’’ 

and insert ‘‘the Supplemental Nutrition Assistance Program’’. 

(3) Strike paragraph (14) and insert the following new 

paragraph: 

‘‘(14) The term ‘outyear’ means a fiscal year one or more 

years after the budget year.’’. 

(4) At the end, add the following new paragraphs: 

‘‘(20) The term ‘emergency’ means a situation that— 

‘‘(A) requires new budget authority and outlays (or 

new budget authority and the outlays flowing therefrom) 

for the prevention or mitigation of, or response to, loss 

of life or property, or a threat to national security; and 

‘‘(B) is unanticipated. 

‘‘(21) The term ‘unanticipated’ means that the underlying 

situation is— 

‘‘(A) sudden, which means quickly coming into being 

or not building up over time; 

‘‘(B) urgent, which means a pressing and compelling 

need requiring immediate action; 

‘‘(C) unforeseen, which means not predicted or anticipated as an emerging need; and 

‘‘(D) temporary, which means not of a permanent duration.’’. 

SEC. 103. REPORTS AND ORDERS. 

Section 254 of the Balanced Budget and Emergency Deficit 

Control Act of 1985 is amended as follows: 

(1) In subsection (c)(2), strike ‘‘2002’’ and insert ‘‘2021’’. 

(2) At the end of subsection (e), insert ‘‘This report shall 

also contain a preview estimate of the adjustment for disaster 

funding for the upcoming fiscal year.’’. 

(3) In subsection (f)(2)(A), strike ‘‘2002’’ and insert ‘‘2021’’; 

before the concluding period insert ‘‘, including a final estimate 

of the adjustment for disaster funding’’. 

SEC. 104. EXPIRATION. 

(a) REPEALER.—Section 275 of the Balanced Budget and Emergency Deficit Control Act of 1985 is repealed. 

(b) CONFORMING CHANGE.—Sections 252(d)(1), 254(c), 254(f)(3), 

and 254(i) of the Balanced Budget and Emergency Deficit Control 

Act of 1985 shall not apply to the Congressional Budget Office. 

SEC. 105. AMENDMENTS TO THE CONGRESSIONAL BUDGET AND 

IMPOUNDMENT CONTROL ACT OF 1974. 

(a) ADJUSTMENTS.—Section 314 of the Congressional Budget 

Act of 1974 is amended as follows: 

(1) Strike subsection (a) and insert the following: 

‘‘(a) ADJUSTMENTS.—After the reporting of a bill or joint resolution or the offering of an amendment thereto or the submission 

2 USC 645. 

2 USC 902 note. 

2 USC 900 note. 

2 USC 904. 


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of a conference report thereon, the chairman of the Committee 

on the Budget of the House of Representatives or the Senate may 

make appropriate budgetary adjustments of new budget authority 

and the outlays flowing therefrom in the same amount as required 

by section 251(b) of the Balanced Budget and Emergency Deficit 

Control Act of 1985.’’. 

(2) Strike subsections (b) and (e) and redesignate subsections (c) and (d) as subsections (b) and (c), respectively. 

(3) At the end, add the following new subsections: 

‘‘(d) EMERGENCIES IN THE HOUSE OF REPRESENTATIVES.— (1) 

In the House of Representatives, if a reported bill or joint resolution, 

or amendment thereto or conference report thereon, contains a 

provision providing new budget authority and outlays or reducing 

revenue, and a designation of such provision as an emergency 

requirement pursuant to 251(b)(2)(A) of the Balanced Budget and 

Emergency Deficit Control Act of 1985, the chair of the Committee 

on the Budget of the House of Representatives shall not count 

the budgetary effects of such provision for purposes of title III 

and title IV of the Congressional Budget Act of 1974 and the 

Rules of the House of Representatives. 

‘‘(2)(A) In the House of Representatives, if a reported bill or 

joint resolution, or amendment thereto or conference report thereon, 

contains a provision providing new budget authority and outlays 

or reducing revenue, and a designation of such provision as an 

emergency pursuant to paragraph (1), the chair of the Committee 

on the Budget shall not count the budgetary effects of such provision 

for purposes of this title and title IV and the Rules of the House 

of Representatives. 

‘‘(B) In the House of Representatives, a proposal to strike 

a designation under subparagraph (A) shall be excluded from an 

evaluation of budgetary effects for purposes of this title and title 

IV and the Rules of the House of Representatives. 

‘‘(C) An amendment offered under subparagraph (B) that also 

proposes to reduce each amount appropriated or otherwise made 

available by the pending measure that is not required to be appropriated or otherwise made available shall be in order at any point 

in the reading of the pending measure. 

‘‘(e) ENFORCEMENT OF DISCRETIONARY SPENDING CAPS.—It shall 

not be in order in the House of Representatives or the Senate 

to consider any bill, joint resolution, amendment, motion, or conference report that would cause the discretionary spending limits 

as set forth in section 251 of the Balanced Budget and Emergency 

Deficit Control Act to be exceeded.’’. 

(b) DEFINITIONS.—Section 3 of the Congressional Budget and 

Impoundment Control Act of 1974 is amended by adding at the 

end the following new paragraph: 

‘‘(11) The terms ‘emergency’ and ‘unanticipated’ have the 

meanings given to such terms in section 250(c) of the Balanced 

Budget and Emergency Deficit Control Act of 1985.’’. 

(c) APPEALS FOR DISCRETIONARY CAPS.—Section 904(c)(2) of 

the Congressional Budget Act of 1974 is amended by striking ‘‘and 

312(c)’’ and inserting ‘‘312(c), and 314(e)’’. 

SEC. 106. SENATE BUDGET ENFORCEMENT. 

(a) IN GENERAL.— (1) For the purpose of enforcing the Congressional Budget 

Act of 1974 through April 15, 2012, including section 300 of 

Applicability. 

2 USC 631 note. 

2 USC 621 note. 

2 USC 622. 


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that Act, and enforcing budgetary points of order in prior 

concurrent resolutions on the budget, the allocations, aggregates, and levels set in subsection (b)(1) shall apply in the 

Senate in the same manner as for a concurrent resolution 

on the budget for fiscal year 2012 with appropriate budgetary 

levels for fiscal years 2011 and 2013 through 2021. 

(2) For the purpose of enforcing the Congressional Budget 

Act of 1974 after April 15, 2012, including section 300 of that 

Act, and enforcing budgetary points of order in prior concurrent 

resolutions on the budget, the allocations, aggregates, and levels 

set in subsection (b)(2) shall apply in the Senate in the same 

manner as for a concurrent resolution on the budget for fiscal 

year 2013 with appropriate budgetary levels for fiscal years 

2012 and 2014 through 2022. 

(b) COMMITTEE ALLOCATIONS, AGGREGATES, AND LEVELS.— 

(1) As soon as practicable after the date of enactment 

of this section, the Chairman of the Committee on the Budget 

shall file— 

(A) for the Committee on Appropriations, committee 

allocations for fiscal years 2011 and 2012 consistent with 

the discretionary spending limits set forth in this Act for 

the purpose of enforcing section 302 of the Congressional 

Budget Act of 1974; 

(B) for all committees other than the Committee on 

Appropriations, committee allocations for fiscal years 2011, 

2012, 2012 through 2016, and 2012 through 2021 consistent 

with the Congressional Budget Office’s March 2011 baseline 

adjusted to account for the budgetary effects of this Act 

and legislation enacted prior to this Act but not included 

in the Congressional Budget Office’s March 2011 baseline, 

for the purpose of enforcing section 302 of the Congressional 

Budget Act of 1974; 

(C) aggregate spending levels for fiscal years 2011 

and 2012 and aggregate revenue levels for fiscal years 

2011, 2012, 2012 through 2016, 2012 through 2021 consistent with the Congressional Budget Office’s March 2011 

baseline adjusted to account for the budgetary effects of 

this Act and legislation enacted prior to this Act but not 

included in the Congressional Budget Office’s March 2011 

baseline, and the discretionary spending limits set forth 

in this Act for the purpose of enforcing section 311 of 

the Congressional Budget Act of 1974; and 

(D) levels of Social Security revenues and outlays for 

fiscal years 2011, 2012, 2012 through 2016, and 2012 

through 2021 consistent with the Congressional Budget 

Office’s March 2011 baseline adjusted to account for the 

budgetary effects of this Act and legislation enacted prior 

to this Act but not included in the Congressional Budget 

Office’s March 2011 baseline, for the purpose of enforcing 

sections 302 and 311 of the Congressional Budget Act of 

1974. 

(2) Not later than April 15, 2012, the Chairman of the 

Committee on the Budget shall file— 

(A) for the Committee on Appropriations, committee 

allocations for fiscal years 2012 and 2013 consistent with 

the discretionary spending limits set forth in this Act for 

Deadline. 


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the purpose of enforcing section 302 of the Congressional 

Budget Act of 1974; 

(B) for all committees other than the Committee on 

Appropriations, committee allocations for fiscal years 2012, 

2013, 2013 through 2017, and 2013 through 2022 consistent 

with the Congressional Budget Office’s March 2012 baseline 

for the purpose of enforcing section 302 of the Congressional 

Budget Act of 1974; 

(C) aggregate spending levels for fiscal years 2012 

and 2013 and aggregate revenue levels for fiscal years 

2012, 2013, 2013–2017, and 2013–2022 consistent with the 

Congressional Budget Office’s March 2012 baseline and 

the discretionary spending limits set forth in this Act for 

the purpose of enforcing section 311 of the Congressional 

Budget Act of 1974; and 

(D) levels of Social Security revenues and outlays for 

fiscal years 2012 and 2013, 2013–2017, and 2013–2022 

consistent with the Congressional Budget Office’s March 

2012 baseline budget for the purpose of enforcing sections 

302 and 311 of the Congressional Budget Act of 1974. 

(c) SENATE PAY-AS-YOU-GO SCORECARD.— 

(1) Effective on the date of enactment of this section, for 

the purpose of enforcing section 201 of S. Con. Res. 21 (110th 

Congress), the Chairman of the Senate Committee on the 

Budget shall reduce any balances of direct spending and revenues for any fiscal year to 0 (zero). 

(2) Not later than April 15, 2012, for the purpose of 

enforcing section 201 of S. Con. Res. 21 (110th Congress), 

the Chairman of the Senate Committee on the Budget shall 

reduce any balances of direct spending and revenues for any 

fiscal year to 0 (zero). 

(3) Upon resetting the Senate paygo scorecard pursuant 

to paragraph (2), the Chairman shall publish a notification 

of such action in the Congressional Record. 

(d) FURTHER ADJUSTMENTS.— 

(1) The Chairman of the Committee on the Budget of 

the Senate may revise any allocations, aggregates, or levels 

set pursuant to this section to account for any subsequent 

adjustments to discretionary spending limits made pursuant 

to this Act. 

(2) With respect to any allocations, aggregates, or levels 

set or adjustments made pursuant to this section, sections 

412 through 414 of S. Con. Res. 13 (111th Congress) shall 

remain in effect. 

(e) EXPIRATION.— 

(1) Subsections (a)(1), (b)(1), and (c)(1) shall expire if a 

concurrent resolution on the budget for fiscal year 2012 is 

agreed to by the Senate and House of Representatives pursuant 

to section 301 of the Congressional Budget Act of 1974. 

(2) Subsections (a)(2), (b)(2), and (c)(2) shall expire if a 

concurrent resolution on the budget for fiscal year 2013 is 

agreed to by the Senate and House of Representatives pursuant 

to section 301 of the Congressional Budget Act of 1974. 

Notification. 

Congressional 

Record. 

Deadline. 

Effective date. 


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TITLE II—VOTE ON THE BALANCED 

BUDGET AMENDMENT 

SEC. 201. VOTE ON THE BALANCED BUDGET AMENDMENT. 

After September 30, 2011, and not later than December 31, 

2011, the House of Representatives and Senate, respectively, shall 

vote on passage of a joint resolution, the title of which is as 

follows: ‘‘Joint resolution proposing a balanced budget amendment 

to the Constitution of the United States.’’. 

SEC. 202. CONSIDERATION BY THE OTHER HOUSE. 

(a) HOUSE CONSIDERATION.— (1) REFERRAL.—If the House receives a joint resolution 

described in section 201 from the Senate, such joint resolution 

shall be referred to the Committee on the Judiciary. If the 

committee fails to report the joint resolution within five legislative days, it shall be in order to move that the House discharge 

the committee from further consideration of the joint resolution. 

Such a motion shall not be in order after the House has disposed 

of a motion to discharge the joint resolution. The previous 

question shall be considered as ordered on the motion to its 

adoption without intervening motion except twenty minutes 

of debate equally divided and controlled by the proponent and 

an opponent. If such a motion is adopted, the House shall 

proceed immediately to consider the joint resolution in accordance with paragraph (3). A motion to reconsider the vote by 

which the motion is disposed of shall not be in order. 

(2) PROCEEDING TO CONSIDERATION.—After the joint resolution has been referred to the appropriate calendar or the committee has been discharged (other than by motion) from its 

consideration, it shall be in order to move to proceed to consider 

the joint resolution in the House. Such a motion shall not 

be in order after the House has disposed of a motion to proceed 

with respect to the joint resolution. The previous question shall 

be considered as ordered on the motion to its adoption without 

intervening motion. A motion to reconsider the vote by which 

the motion is disposed of shall not be in order. 

(3) CONSIDERATION.—The joint resolution shall be considered as read. All points of order against the joint resolution 

and against its consideration are waived. The previous question 

shall be considered as ordered on the joint resolution to its 

passage without intervening motion except two hours of debate 

equally divided and controlled by the proponent and an opponent and one motion to limit debate on the joint resolution. 

A motion to reconsider the vote on passage of the joint resolution shall not be in order. 

(b) SENATE CONSIDERATION.—(1) If the Senate receives a joint 

resolution described in section 201 from the House of Representatives, such joint resolution shall be referred to the appropriate 

committee of the Senate. If such committee has not reported the 

joint resolution at the close of the fifth session day after its receipt 

by the Senate, such committee shall be automatically discharged 

from further consideration of the joint resolution and it shall be 

placed on the appropriate calendar. 

(2) Consideration of the joint resolution and on all debatable 

motions and appeals in connection therewith, shall be limited to 

Deadline. 

Deadline. 

Time period. 


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not more than 20 hours, which shall be divided equally between 

the majority and minority leaders or their designees. A motion 

further to limit debate is in order and not debatable. An amendment 

to, or a motion to postpone, or a motion to proceed to the consideration of other business, or a motion to recommit the joint resolution 

is not in order. Any debatable motion or appeal is debatable for 

not to exceed 1 hour, to be divided equally between those favoring 

and those opposing the motion or appeal. All time used for consideration of the joint resolution, including time used for quorum calls 

and voting, shall be counted against the total 20 hours of consideration. 

(3) If the Senate has voted to proceed to a joint resolution, 

the vote on passage of the joint resolution shall be taken on or 

before the close of the seventh session day after such joint resolution 

has been reported or discharged or immediately following the 

conclusion of consideration of the joint resolution, and a single 

quorum call at the conclusion of the debate if requested in accordance with the rules of the Senate. 

TITLE III—DEBT CEILING DISAPPROVAL 

PROCESS 

SEC. 301. DEBT CEILING DISAPPROVAL PROCESS. 

(a) IN GENERAL.—Subchapter I of chapter 31 of subtitle III 

of title 31, United States Code, is amended— 

(1) in section 3101(b), by striking ‘‘or otherwise’’ and 

inserting ‘‘or as provided by section 3101A or otherwise’’; and 

(2) by inserting after section 3101 the following: 

‘‘§ 3101A. Presidential modification of the debt ceiling 

‘‘(a) IN GENERAL.— ‘‘(1) $900 BILLION.— ‘‘(A) CERTIFICATION.—If, not later than December 31, 

2011, the President submits a written certification to Congress that the President has determined that the debt 

subject to limit is within $100,000,000,000 of the limit 

in section 3101(b) and that further borrowing is required 

to meet existing commitments, the Secretary of the 

Treasury may exercise authority to borrow an additional 

$900,000,000,000, subject to the enactment of a joint resolution of disapproval enacted pursuant to this section. Upon 

submission of such certification, the limit on debt provided 

in section 3101(b) (referred to in this section as the ‘debt 

limit’) is increased by $400,000,000,000. 

‘‘(B) RESOLUTION OF DISAPPROVAL.—Congress may consider a joint resolution of disapproval of the authority 

under subparagraph (A) as provided in subsections (b) 

through (f). The joint resolution of disapproval considered 

under this section shall contain only the language provided 

in subsection (b)(2). If the time for disapproval has lapsed 

without enactment of a joint resolution of disapproval under 

this section, the debt limit is increased by an additional 

$500,000,000,000. 

‘‘(2) ADDITIONAL AMOUNT.— ‘‘(A) CERTIFICATION.—If, after the debt limit is 

increased by $900,000,000,000 under paragraph (1), the 

Deadline. 

Deadline. 


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President submits a written certification to Congress that 

the President has determined that the debt subject to limit 

is within $100,000,000,000 of the limit in section 3101(b) 

and that further borrowing is required to meet existing 

commitments, the Secretary of the Treasury may, subject 

to the enactment of a joint resolution of disapproval enacted 

pursuant to this section, exercise authority to borrow an 

additional amount equal to— 

‘‘(i) $1,200,000,000,000, unless clause (ii) or (iii) 

applies; 

‘‘(ii) $1,500,000,000,000 if the Archivist of the 

United States has submitted to the States for their 

ratification a proposed amendment to the Constitution 

of the United States pursuant to a joint resolution 

entitled ‘Joint resolution proposing a balanced budget 

amendment to the Constitution of the United States’; 

or 

‘‘(iii) if a joint committee bill to achieve an amount 

greater than $1,200,000,000,000 in deficit reduction 

as provided in section 401(b)(3)(B)(i)(II) of the Budget 

Control Act of 2011 is enacted, an amount equal to 

the amount of that deficit reduction, but not greater 

than $1,500,000,000,000, unless clause (ii) applies. 

‘‘(B) RESOLUTION OF DISAPPROVAL.—Congress may consider a joint resolution of disapproval of the authority 

under subparagraph (A) as provided in subsections (b) 

through (f). The joint resolution of disapproval considered 

under this section shall contain only the language provided 

in subsection (b)(2). If the time for disapproval has lapsed 

without enactment of a joint resolution of disapproval under 

this section, the debt limit is increased by the amount 

authorized under subparagraph (A). 

‘‘(b) JOINT RESOLUTION OF DISAPPROVAL.— 

‘‘(1) IN GENERAL.—Except for the $400,000,000,000 increase 

in the debt limit provided by subsection (a)(1)(A), the debt 

limit may not be raised under this section if, within 50 calendar 

days after the date on which Congress receives a certification 

described in subsection (a)(1) or within 15 calendar days after 

Congress receives the certification described in subsection (a)(2) 

(regardless of whether Congress is in session), there is enacted 

into law a joint resolution disapproving the President’s exercise 

of authority with respect to such additional amount. 

‘‘(2) CONTENTS OF JOINT RESOLUTION.—For the purpose of 

this section, the term ‘joint resolution’ means only a joint resolution— 

‘‘(A)(i) for the certification described in subsection 

(a)(1), that is introduced on September 6, 7, 8, or 9, 2011 

(or, if the Senate was not in session, the next calendar 

day on which the Senate is in session); and 

‘‘(ii) for the certification described in subsection (a)(2), 

that is introduced between the date the certification is 

received and 3 calendar days after that date; 

‘‘(B) which does not have a preamble; 

‘‘(C) the title of which is only as follows: ‘Joint resolution relating to the disapproval of the President’s exercise 

of authority to increase the debt limit, as submitted under 

section 3101A of title 31, United States Code, on 

Definition. 

Deadlines. 


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llllll’ (with the blank containing the date of such 

submission); and 

‘‘(D) the matter after the resolving clause of which 

is only as follows: ‘That Congress disapproves of the President’s exercise of authority to increase the debt limit, as 

exercised pursuant to the certification under section 

3101A(a) of title 31, United States Code.’. 

‘‘(c) EXPEDITED CONSIDERATION IN HOUSE OF REPRESENTA- TIVES.— ‘‘(1) RECONVENING.—Upon receipt of a certification 

described in subsection (a)(2), the Speaker, if the House would 

otherwise be adjourned, shall notify the Members of the House 

that, pursuant to this section, the House shall convene not 

later than the second calendar day after receipt of such certification. 

‘‘(2) REPORTING AND DISCHARGE.—Any committee of the 

House of Representatives to which a joint resolution is referred 

shall report it to the House without amendment not later 

than 5 calendar days after the date of introduction of a joint 

resolution described in subsection (a). If a committee fails to 

report the joint resolution within that period, the committee 

shall be discharged from further consideration of the joint resolution and the joint resolution shall be referred to the appropriate calendar. 

‘‘(3) PROCEEDING TO CONSIDERATION.—After each committee 

authorized to consider a joint resolution reports it to the House 

or has been discharged from its consideration, it shall be in 

order, not later than the sixth day after introduction of a 

joint resolution under subsection (a), to move to proceed to 

consider the joint resolution in the House. All points of order 

against the motion are waived. Such a motion shall not be 

in order after the House has disposed of a motion to proceed 

on a joint resolution addressing a particular submission. The 

previous question shall be considered as ordered on the motion 

to its adoption without intervening motion. The motion shall 

not be debatable. A motion to reconsider the vote by which 

the motion is disposed of shall not be in order. 

‘‘(4) CONSIDERATION.—The joint resolution shall be considered as read. All points of order against the joint resolution 

and against its consideration are waived. The previous question 

shall be considered as ordered on the joint resolution to its 

passage without intervening motion except two hours of debate 

equally divided and controlled by the proponent and an opponent. A motion to reconsider the vote on passage of the joint 

resolution shall not be in order. 

‘‘(d) EXPEDITED PROCEDURE IN SENATE.— 

‘‘(1) RECONVENING.—Upon receipt of a certification under 

subsection (a)(2), if the Senate has adjourned or recessed for 

more than 2 days, the majority leader of the Senate, after 

consultation with the minority leader of the Senate, shall notify 

the Members of the Senate that, pursuant to this section, 

the Senate shall convene not later than the second calendar 

day after receipt of such message. 

‘‘(2) PLACEMENT ON CALENDAR.—Upon introduction in the 

Senate, the joint resolution shall be immediately placed on 

the calendar. 

‘‘(3) FLOOR CONSIDERATION.— 

Notification. 

Deadline. 

Deadline. 

Notification. 

Deadline. 


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‘‘(A) IN GENERAL.—Notwithstanding Rule XXII of the 

Standing Rules of the Senate, it is in order at any time 

during the period beginning on the day after the date 

on which Congress receives a certification under subsection 

(a) and, for the certification described in subsection (a)(1), 

ending on September 14, 2011, and for the certification 

described in subsection (a)(2), on the 6th day after the 

date on which Congress receives a certification under subsection (a) (even though a previous motion to the same 

effect has been disagreed to) to move to proceed to the 

consideration of the joint resolution, and all points of order 

against the joint resolution (and against consideration of 

the joint resolution) are waived. The motion to proceed 

is not debatable. The motion is not subject to a motion 

to postpone. A motion to reconsider the vote by which 

the motion is agreed to or disagreed to shall not be in 

order. If a motion to proceed to the consideration of the 

resolution is agreed to, the joint resolution shall remain 

the unfinished business until disposed of. 

‘‘(B) CONSIDERATION.—Consideration of the joint resolution, and on all debatable motions and appeals in connection therewith, shall be limited to not more than 10 hours, 

which shall be divided equally between the majority and 

minority leaders or their designees. A motion further to 

limit debate is in order and not debatable. An amendment 

to, or a motion to postpone, or a motion to proceed to 

the consideration of other business, or a motion to recommit 

the joint resolution is not in order. 

‘‘(C) VOTE ON PASSAGE.—If the Senate has voted to 

proceed to a joint resolution, the vote on passage of the 

joint resolution shall occur immediately following the 

conclusion of consideration of the joint resolution, and a 

single quorum call at the conclusion of the debate if 

requested in accordance with the rules of the Senate. 

‘‘(D) RULINGS OF THE CHAIR ON PROCEDURE.—Appeals 

from the decisions of the Chair relating to the application 

of the rules of the Senate, as the case may be, to the 

procedure relating to a joint resolution shall be decided 

without debate. 

‘‘(e) AMENDMENT NOT IN ORDER.—A joint resolution of disapproval considered pursuant to this section shall not be subject 

to amendment in either the House of Representatives or the Senate. 

‘‘(f) COORDINATION WITH ACTION BY OTHER HOUSE.— 

‘‘(1) IN GENERAL.—If, before passing the joint resolution, 

one House receives from the other a joint resolution— 

‘‘(A) the joint resolution of the other House shall not 

be referred to a committee; and 

‘‘(B) the procedure in the receiving House shall be 

the same as if no joint resolution had been received from 

the other House until the vote on passage, when the joint 

resolution received from the other House shall supplant 

the joint resolution of the receiving House. 

‘‘(2) TREATMENT OF JOINT RESOLUTION OF OTHER HOUSE.— 

If the Senate fails to introduce or consider a joint resolution 

under this section, the joint resolution of the House shall be 

entitled to expedited floor procedures under this section. 

Time period. 

Waiver. 


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‘‘(3) TREATMENT OF COMPANION MEASURES.—If, following 

passage of the joint resolution in the Senate, the Senate then 

receives the companion measure from the House of Representatives, the companion measure shall not be debatable. 

‘‘(4) CONSIDERATION AFTER PASSAGE.—(A) If Congress 

passes a joint resolution, the period beginning on the date 

the President is presented with the joint resolution and ending 

on the date the President signs, allows to become law without 

his signature, or vetoes and returns the joint resolution (but 

excluding days when either House is not in session) shall be 

disregarded in computing the appropriate calendar day period 

described in subsection (b)(1). 

‘‘(B) Debate on a veto message in the Senate under this 

section shall be 1 hour equally divided between the majority 

and minority leaders or their designees. 

‘‘(5) VETO OVERRIDE.—If within the appropriate calendar 

day period described in subsection (b)(1), Congress overrides 

a veto of the joint resolution with respect to authority exercised 

pursuant to paragraph (1) or (2) of subsection (a), the limit 

on debt provided in section 3101(b) shall not be raised, except 

for the $400,000,000,000 increase in the limit provided by subsection (a)(1)(A). 

‘‘(6) SEQUESTRATION.—(A) If within the 50-calendar day 

period described in subsection (b)(1), the President signs the 

joint resolution, the President allows the joint resolution to 

become law without his signature, or Congress overrides a 

veto of the joint resolution with respect to authority exercised 

pursuant to paragraph (1) of subsection (a), there shall be 

a sequestration to reduce spending by $400,000,000,000. OMB 

shall implement the sequestration forthwith. 

‘‘(B) OMB shall implement each half of such sequestration 

in accordance with section 255, section 256, and subsections 

(c), (d), (e), and (f) of section 253 of the Balanced Budget 

and Emergency Deficit Control Act of 1985, and for the purpose 

of such implementation the term ‘excess deficit’ means the 

amount specified in subparagraph (A). 

‘‘(g) RULES OF HOUSE OF REPRESENTATIVES AND SENATE.—This 

subsection and subsections (b), (c), (d), (e), and (f) (other than 

paragraph (6)) are enacted by Congress— 

‘‘(1) as an exercise of the rulemaking power of the Senate 

and House of Representatives, respectively, and as such it 

is deemed a part of the rules of each House, respectively, 

but applicable only with respect to the procedure to be followed 

in that House in the case of a joint resolution, and it supersedes 

other rules only to the extent that it is inconsistent with such 

rules; and 

‘‘(2) with full recognition of the constitutional right of either 

House to change the rules (so far as relating to the procedure 

of that House) at any time, in the same manner, and to the 

same extent as in the case of any other rule of that House.’’. 

(b) CONFORMING AMENDMENT.—The table of sections for chapter 

31 of title 31, United States Code, is amended by inserting after 

the item relating to section 3101 the following new item: 

‘‘3101A. Presidential modification of the debt ceiling.’’. 

Definition. 

Time period. 

President. 


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SEC. 302. ENFORCEMENT OF BUDGET GOAL. 

(a) IN GENERAL.—The Balanced Budget and Emergency Deficit 

Control Act of 1985 is amended by inserting after section 251 

the following new section: 

‘‘SEC. 251A. ENFORCEMENT OF BUDGET GOAL. 

‘‘Unless a joint committee bill achieving an amount greater 

than $1,200,000,000,000 in deficit reduction as provided in section 

401(b)(3)(B)(i)(II) of the Budget Control Act of 2011 is enacted 

by January 15, 2012, the discretionary spending limits listed in 

section 251(c) shall be revised, and discretionary appropriations 

and direct spending shall be reduced, as follows: 

‘‘(1) REVISED SECURITY CATEGORY; REVISED NONSECURITY

CATEGORY.—(A) The term ‘revised security category’ means 

discretionary appropriations in budget function 050. 

‘‘(B) The term ‘revised nonsecurity category’ means discretionary appropriations other than in budget function 050. 

‘‘(2) REVISED DISCRETIONARY SPENDING LIMITS.—The discretionary spending limits for fiscal years 2013 through 2021 

under section 251(c) shall be replaced with the following: 

‘‘(A) For fiscal year 2013— 

‘‘(i) for the security category, $546,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $501,000,000,000 

in budget authority. 

‘‘(B) For fiscal year 2014— 

‘‘(i) for the security category, $556,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $510,000,000,000 

in budget authority. 

‘‘(C) For fiscal year 2015— 

‘‘(i) for the security category, $566,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $520,000,000,000 

in budget authority. 

‘‘(D) For fiscal year 2016— 

‘‘(i) for the security category, $577,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $530,000,000,000 

in budget authority. 

‘‘(E) For fiscal year 2017— 

‘‘(i) for the security category, $590,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $541,000,000,000 

in budget authority. 

‘‘(F) For fiscal year 2018— 

‘‘(i) for the security category, $603,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $553,000,000,000 

in budget authority. 

‘‘(G) For fiscal year 2019— 

‘‘(i) for the security category, $616,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $566,000,000,000 

in budget authority. 

‘‘(H) For fiscal year 2020— 

Definitions. 

Deadline. 

2 USC 901a. 


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‘‘(i) for the security category, $630,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $578,000,000,000 

in budget authority. 

‘‘(I) For fiscal year 2021— 

‘‘(i) for the security category, $644,000,000,000 in 

budget authority; and 

‘‘(ii) for the nonsecurity category, $590,000,000,000 

in budget authority. 

‘‘(3) CALCULATION OF TOTAL DEFICIT REDUCTION.—OMB 

shall calculate the amount of the deficit reduction required 

by this section for each of fiscal years 2013 through 2021 

by— 

‘‘(A) starting with $1,200,000,000,000; 

‘‘(B) subtracting the amount of deficit reduction 

achieved by the enactment of a joint committee bill, as 

provided in section 401(b)(3)(B)(i)(II) of the Budget Control 

Act of 2011; 

‘‘(C) reducing the difference by 18 percent to account 

for debt service; and 

‘‘(D) dividing the result by 9. 

‘‘(4) ALLOCATION TO FUNCTIONS.—On January 2, 2013, for 

fiscal year 2013, and in its sequestration preview report for 

fiscal years 2014 through 2021 pursuant to section 254(c), OMB 

shall allocate half of the total reduction calculated pursuant 

to paragraph (3) for that year to discretionary appropriations 

and direct spending accounts within function 050 (defense function) and half to accounts in all other functions (nondefense 

functions). 

‘‘(5) DEFENSE FUNCTION REDUCTION.—OMB shall calculate 

the reductions to discretionary appropriations and direct 

spending for each of fiscal years 2013 through 2021 for defense 

function spending as follows: 

‘‘(A) DISCRETIONARY.—OMB shall calculate the reduction to discretionary appropriations by— 

‘‘(i) taking the total reduction for the defense function allocated for that year under paragraph (4); 

‘‘(ii) multiplying by the discretionary spending 

limit for the revised security category for that year; 

and 

‘‘(iii) dividing by the sum of the discretionary 

spending limit for the security category and OMB’s 

baseline estimate of nonexempt outlays for direct 

spending programs within the defense function for that 

year. 

‘‘(B) DIRECT SPENDING.—OMB shall calculate the 

reduction to direct spending by taking the total reduction 

for the defense function required for that year under paragraph (4) and subtracting the discretionary reduction calculated pursuant to subparagraph (A). 

‘‘(6) NONDEFENSE FUNCTION REDUCTION.—OMB shall calculate the reduction to discretionary appropriations and to 

direct spending for each of fiscal years 2013 through 2021 

for programs in nondefense functions as follows: 

‘‘(A) DISCRETIONARY.—OMB shall calculate the reduction to discretionary appropriations by— 

Effective date. 


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‘‘(i) taking the total reduction for nondefense functions allocated for that year under paragraph (4); 

‘‘(ii) multiplying by the discretionary spending 

limit for the revised nonsecurity category for that year; 

and 

‘‘(iii) dividing by the sum of the discretionary 

spending limit for the revised nonsecurity category 

and OMB’s baseline estimate of nonexempt outlays 

for direct spending programs in nondefense functions 

for that year. 

‘‘(B) DIRECT SPENDING.—OMB shall calculate the 

reduction to direct spending programs by taking the total 

reduction for nondefense functions required for that year 

under paragraph (4) and subtracting the discretionary 

reduction calculated pursuant to subparagraph (A). 

‘‘(7) IMPLEMENTING DISCRETIONARY REDUCTIONS.— ‘‘(A) FISCAL YEAR 2013.—On January 2, 2013, for fiscal 

year 2013, OMB shall calculate and the President shall 

order a sequestration, effective upon issuance and under 

the procedures set forth in section 253(f), to reduce each 

account within the security category or nonsecurity category by a dollar amount calculated by multiplying the 

baseline level of budgetary resources in that account at 

that time by a uniform percentage necessary to achieve— 

‘‘(i) for the revised security category, an amount 

equal to the defense function discretionary reduction 

calculated pursuant to paragraph (5); and 

‘‘(ii) for the revised nonsecurity category, an 

amount equal to the nondefense function discretionary 

reduction calculated pursuant to paragraph (6). 

‘‘(B) FISCAL YEARS 2014–2021.—On the date of the 

submission of its sequestration preview report for fiscal 

years 2014 through 2021 pursuant to section 254(c) for 

each of fiscal years 2014 through 2021, OMB shall reduce 

the discretionary spending limit— 

‘‘(i) for the revised security category by the amount 

of the defense function discretionary reduction calculated pursuant to paragraph (5); and 

‘‘(ii) for the revised nonsecurity category by the 

amount of the nondefense function discretionary reduction calculated pursuant to paragraph (6). 

‘‘(8) IMPLEMENTING DIRECT SPENDING REDUCTIONS.—On the 

date specified in paragraph (4) during each applicable year, 

OMB shall prepare and the President shall order a sequestration, effective upon issuance, of nonexempt direct spending 

to achieve the direct spending reduction calculated pursuant 

to paragraphs (5) and (6). When implementing the sequestration 

of direct spending pursuant to this paragraph, OMB shall follow 

the procedures specified in section 6 of the Statutory PayAs-You-Go Act of 2010, the exemptions specified in section 

255, and the special rules specified in section 256, except that 

the percentage reduction for the Medicare programs specified 

in section 256(d) shall not be more than 2 percent for a fiscal 

year. 

‘‘(9) ADJUSTMENT FOR MEDICARE.—If the percentage reduction for the Medicare programs would exceed 2 percent for 

a fiscal year in the absence of paragraph (8), OMB shall 

President. 

Sequestration 

order. 

Effective date. 

President. 

Sequestration 

order. 


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increase the reduction for all other discretionary appropriations 

and direct spending under paragraph (6) by a uniform percentage to a level sufficient to achieve the reduction required by 

paragraph (6) in the non-defense function. 

‘‘(10) IMPLEMENTATION OF REDUCTIONS.—Any reductions 

imposed under this section shall be implemented in accordance 

with section 256(k). 

‘‘(11) REPORT.—On the dates specified in paragraph (4), 

OMB shall submit a report to Congress containing information 

about the calculations required under this section, the adjusted 

discretionary spending limits, a listing of the reductions 

required for each nonexempt direct spending account, and any 

other data and explanations that enhance public understanding 

of this title and actions taken under it.’’. 

(b) CONFORMING AMENDMENT.—The table of contents set forth 

in section 250(a) of the Balanced Budget and Emergency Deficit 

Control Act of 1985 is amended by inserting after the item relating 

to section 251 the following: 

‘‘Sec. 251A. Enforcement of budget goal.’’. 

TITLE IV—JOINT SELECT COMMITTEE 

ON DEFICIT REDUCTION 

SEC. 401. ESTABLISHMENT OF JOINT SELECT COMMITTEE. 

(a) DEFINITIONS.—In this title: 

(1) JOINT COMMITTEE.—The term ‘‘joint committee’’ means 

the Joint Select Committee on Deficit Reduction established 

under subsection (b)(1). 

(2) JOINT COMMITTEE BILL.—The term ‘‘joint committee bill’’ 

means a bill consisting of the proposed legislative language 

of the joint committee recommended under subsection (b)(3)(B) 

and introduced under section 402(a). 

(b) ESTABLISHMENT OF JOINT SELECT COMMITTEE.— (1) ESTABLISHMENT.—There is established a joint select 

committee of Congress to be known as the ‘‘Joint Select Committee on Deficit Reduction’’. 

(2) GOAL.—The goal of the joint committee shall be to 

reduce the deficit by at least $1,500,000,000,000 over the period 

of fiscal years 2012 to 2021. 

(3) DUTIES.— 

(A) IN GENERAL.— 

(i) IMPROVING THE SHORT-TERM AND LONG-TERM

FISCAL IMBALANCE.—The joint committee shall provide 

recommendations and legislative language that will 

significantly improve the short-term and long-term 

fiscal imbalance of the Federal Government. 

(ii) RECOMMENDATIONS OF COMMITTEES.—Not later 

than October 14, 2011, each committee of the House 

of Representatives and the Senate may transmit to 

the joint committee its recommendations for changes 

in law to reduce the deficit consistent with the goal 

described in paragraph (2) for the joint committee’s 

consideration. 

(B) REPORT, RECOMMENDATIONS, AND LEGISLATIVE LAN- GUAGE.— 

Deadline. 

Recommendations. 

2 USC 900 note. 


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(i) IN GENERAL.—Not later than November 23, 

2011, the joint committee shall vote on— 

(I) a report that contains a detailed statement 

of the findings, conclusions, and recommendations 

of the joint committee and the estimate of the 

Congressional Budget Office required by paragraph (5)(D)(ii); and 

(II) proposed legislative language to carry out 

such recommendations as described in subclause 

(I), which shall include a statement of the deficit 

reduction achieved by the legislation over the 

period of fiscal years 2012 to 2021. 

Any change to the Rules of the House of Representatives or the Standing Rules of the Senate included 

in the report or legislative language shall be considered 

to be merely advisory. 

(ii) APPROVAL OF REPORT AND LEGISLATIVE LANGUAGE.—The report of the joint committee and the 

proposed legislative language described in clause (i) 

shall require the approval of a majority of the members 

of the joint committee. 

(iii) ADDITIONAL VIEWS.—A member of the joint 

committee who gives notice of an intention to file 

supplemental, minority, or additional views at the time 

of final joint committee vote on the approval of the 

report and legislative language under clause (ii) shall 

be entitled to 3 calendar days in which to file such 

views in writing with the staff director of the joint 

committee. Such views shall then be included in the 

joint committee report and printed in the same volume, 

or part thereof, and their inclusion shall be noted 

on the cover of the report. In the absence of timely 

notice, the joint committee report may be printed and 

transmitted immediately without such views. 

(iv) TRANSMISSION OF REPORT AND LEGISLATIVE

LANGUAGE.—If the report and legislative language are 

approved by the joint committee pursuant to clause 

(ii), then not later than December 2, 2011, the joint 

committee shall submit the joint committee report and 

legislative language described in clause (i) to the President, the Vice President, the Speaker of the House 

of Representatives, and the majority and minority 

Leaders of each House of Congress. 

(v) REPORT AND LEGISLATIVE LANGUAGE TO BE

MADE PUBLIC.—Upon the approval or disapproval of 

the joint committee report and legislative language 

pursuant to clause (ii), the joint committee shall 

promptly make the full report and legislative language, 

and a record of the vote, available to the public. 

(4) MEMBERSHIP.— 

(A) IN GENERAL.—The joint committee shall be composed of 12 members appointed pursuant to subparagraph 

(B). 

(B) APPOINTMENT.—Members of the joint committee 

shall be appointed as follows: 

(i) The majority leader of the Senate shall appoint 

three members from among Members of the Senate. 

Time period. 


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(ii) The minority leader of the Senate shall appoint 

three members from among Members of the Senate. 

(iii) The Speaker of the House of Representatives 

shall appoint three members from among Members 

of the House of Representatives. 

(iv) The minority leader of the House of Representatives shall appoint three members from among Members of the House of Representatives. 

(C) CO-CHAIRS.— (i) IN GENERAL.—There shall be two Co-Chairs of 

the joint committee. The majority leader of the Senate 

shall appoint one Co-Chair from among the members 

of the joint committee. The Speaker of the House of 

Representatives shall appoint the second Co-Chair 

from among the members of the joint committee. The 

Co-Chairs shall be appointed not later than 14 calendar 

days after the date of enactment of this Act. 

(ii) STAFF DIRECTOR.—The Co-Chairs, acting 

jointly, shall hire the staff director of the joint committee. 

(D) DATE.—Members of the joint committee shall be 

appointed not later than 14 calendar days after the date 

of enactment of this Act. 

(E) PERIOD OF APPOINTMENT.—Members shall be 

appointed for the life of the joint committee. Any vacancy 

in the joint committee shall not affect its powers, but 

shall be filled not later than 14 calendar days after the 

date on which the vacancy occurs, in the same manner 

as the original designation was made. If a member of 

the joint committee ceases to be a Member of the House 

of Representatives or the Senate, as the case may be, 

the member is no longer a member of the joint committee 

and a vacancy shall exist. 

(5) ADMINISTRATION.— 

(A) IN GENERAL.—To enable the joint committee to 

exercise its powers, functions, and duties, there are authorized to be disbursed by the Senate the actual and necessary 

expenses of the joint committee approved by the co-chairs, 

subject to the rules and regulations of the Senate. 

(B) EXPENSES.—In carrying out its functions, the joint 

committee is authorized to incur expenses in the same 

manner and under the same conditions as the Joint Economic Committee is authorized by section 11 of Public 

Law 79–304 (15 U.S.C. 1024 (d)). 

(C) QUORUM.—Seven members of the joint committee 

shall constitute a quorum for purposes of voting, meeting, 

and holding hearings. 

(D) VOTING.— 

(i) PROXY VOTING.—No proxy voting shall be 

allowed on behalf of the members of the joint committee. 

(ii) CONGRESSIONAL BUDGET OFFICE ESTIMATES.— 

The Congressional Budget Office shall provide estimates of the legislation (as described in paragraph 

(3)(B)) in accordance with sections 308(a) and 201(f) 

of the Congressional Budget Act of 1974 (2 U.S.C. 

639(a) and 601(f))(including estimates of the effect of 

Deadline. 

Appointments. 

Deadline. 

Deadline. 

Appointments. 


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interest payment on the debt). In addition, the 

Congressional Budget Office shall provide information 

on the budgetary effect of the legislation beyond the 

year 2021. The joint committee may not vote on any 

version of the report, recommendations, or legislative 

language unless such estimates are available for 

consideration by all members of the joint committee 

at least 48 hours prior to the vote as certified by 

the Co-Chairs. 

(E) MEETINGS.— (i) INITIAL MEETING.—Not later than 45 calendar 

days after the date of enactment of this Act, the joint 

committee shall hold its first meeting. 

(ii) AGENDA.—The Co-Chairs of the joint committee 

shall provide an agenda to the joint committee members not less than 48 hours in advance of any meeting. 

(F) HEARINGS.— 

(i) IN GENERAL.—The joint committee may, for the 

purpose of carrying out this section, hold such hearings, 

sit and act at such times and places, require attendance 

of witnesses and production of books, papers, and documents, take such testimony, receive such evidence, and 

administer such oaths as the joint committee considers 

advisable. 

(ii) HEARING PROCEDURES AND RESPONSIBILITIES OF

CO-CHAIRS.— 

(I) ANNOUNCEMENT.—The Co-Chairs of the 

joint committee shall make a public announcement 

of the date, place, time, and subject matter of 

any hearing to be conducted, not less than 7 days 

in advance of such hearing, unless the Co-Chairs 

determine that there is good cause to begin such 

hearing at an earlier date. 

(II) WRITTEN STATEMENT.—A witness 

appearing before the joint committee shall file a 

written statement of proposed testimony at least 

2 calendar days before the appearance of the witness, unless the requirement is waived by the CoChairs, following their determination that there 

is good cause for failure to comply with such 

requirement. 

(G) TECHNICAL ASSISTANCE.—Upon written request of 

the Co-Chairs, a Federal agency shall provide technical 

assistance to the joint committee in order for the joint 

committee to carry out its duties. 

(c) STAFF OF JOINT COMMITTEE.— 

(1) IN GENERAL.—The Co-Chairs of the joint committee 

may jointly appoint and fix the compensation of staff as they 

deem necessary, within the guidelines for employees of the 

Senate and following all applicable rules and employment 

requirements of the Senate. 

(2) ETHICAL STANDARDS.—Members on the joint committee 

who serve in the House of Representatives shall be governed 

by the ethics rules and requirements of the House. Members 

of the Senate who serve on the joint committee and staff of 

the joint committee shall comply with the ethics rules of the 

Senate. 

Compliance. 

Deadlines. 

Deadlines. 

Deadline. 


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PUBLIC LAW 112–25—AUG. 2, 2011 125 STAT. 263 

(d) TERMINATION.—The joint committee shall terminate on 

January 31, 2012. 

SEC. 402. EXPEDITED CONSIDERATION OF JOINT COMMITTEE RECOMMENDATIONS. 

(a) INTRODUCTION.—If approved by the majority required by 

section 401(b)(3)(B)(ii), the proposed legislative language submitted 

pursuant to section 401(b)(3)(B)(iv) shall be introduced in the Senate 

(by request) on the next day on which the Senate is in session 

by the majority leader of the Senate or by a Member of the Senate 

designated by the majority leader of the Senate and shall be introduced in the House of Representatives (by request) on the next 

legislative day by the majority leader of the House or by a Member 

of the House designated by the majority leader of the House. 

(b) CONSIDERATION IN THE HOUSE OF REPRESENTATIVES.— 

(1) REFERRAL AND REPORTING.—Any committee of the 

House of Representatives to which the joint committee bill 

is referred shall report it to the House without amendment 

not later than December 9, 2011. If a committee fails to report 

the joint committee bill within that period, it shall be in order 

to move that the House discharge the committee from further 

consideration of the bill. Such a motion shall not be in order 

after the last committee authorized to consider the bill reports 

it to the House or after the House has disposed of a motion 

to discharge the bill. The previous question shall be considered 

as ordered on the motion to its adoption without intervening 

motion except 20 minutes of debate equally divided and controlled by the proponent and an opponent. If such a motion 

is adopted, the House shall proceed immediately to consider 

the joint committee bill in accordance with paragraphs (2) 

and (3). A motion to reconsider the vote by which the motion 

is disposed of shall not be in order. 

(2) PROCEEDING TO CONSIDERATION.—After the last committee authorized to consider a joint committee bill reports 

it to the House or has been discharged (other than by motion) 

from its consideration, it shall be in order to move to proceed 

to consider the joint committee bill in the House. Such a motion 

shall not be in order after the House has disposed of a motion 

to proceed with respect to the joint committee bill. The previous 

question shall be considered as ordered on the motion to its 

adoption without intervening motion. A motion to reconsider 

the vote by which the motion is disposed of shall not be in 

order. 

(3) CONSIDERATION.—The joint committee bill shall be 

considered as read. All points of order against the joint committee bill and against its consideration are waived. The previous question shall be considered as ordered on the joint 

committee bill to its passage without intervening motion except 

2 hours of debate equally divided and controlled by the proponent and an opponent and one motion to limit debate on 

the joint committee bill. A motion to reconsider the vote on 

passage of the joint committee bill shall not be in order. 

(4) VOTE ON PASSAGE.—The vote on passage of the joint 

committee bill shall occur not later than December 23, 2011. 

(c) EXPEDITED PROCEDURE IN THE SENATE.— 

(1) COMMITTEE CONSIDERATION.—A joint committee bill 

introduced in the Senate under subsection (a) shall be jointly 

Reports. 

Deadline. 

Deadline. 

Waiver. 

2 USC 900 note. 


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125 STAT. 264 PUBLIC LAW 112–25—AUG. 2, 2011 

referred to the committee or committees of jurisdiction, which 

committees shall report the bill without any revision and with 

a favorable recommendation, an unfavorable recommendation, 

or without recommendation, not later than December 9, 2011. 

If any committee fails to report the bill within that period, 

that committee shall be automatically discharged from consideration of the bill, and the bill shall be placed on the appropriate 

calendar. 

(2) MOTION TO PROCEED.—Notwithstanding Rule XXII of 

the Standing Rules of the Senate, it is in order, not later 

than 2 days of session after the date on which a joint committee 

bill is reported or discharged from all committees to which 

it was referred, for the majority leader of the Senate or the 

majority leader’s designee to move to proceed to the consideration of the joint committee bill. It shall also be in order 

for any Member of the Senate to move to proceed to the consideration of the joint committee bill at any time after the conclusion of such 2-day period. A motion to proceed is in order 

even though a previous motion to the same effect has been 

disagreed to. All points of order against the motion to proceed 

to the joint committee bill are waived. The motion to proceed 

is not debatable. The motion is not subject to a motion to 

postpone. A motion to reconsider the vote by which the motion 

is agreed to or disagreed to shall not be in order. If a motion 

to proceed to the consideration of the joint committee bill is 

agreed to, the joint committee bill shall remain the unfinished 

business until disposed of. 

(3) CONSIDERATION.—All points of order against the joint 

committee bill and against consideration of the joint committee 

bill are waived. Consideration of the joint committee bill and 

of all debatable motions and appeals in connection therewith 

shall not exceed a total of 30 hours which shall be divided 

equally between the Majority and Minority Leaders or their 

designees. A motion further to limit debate on the joint committee bill is in order, shall require an affirmative vote of 

three-fifths of the Members duly chosen and sworn, and is 

not debatable. Any debatable motion or appeal is debatable 

for not to exceed 1 hour, to be divided equally between those 

favoring and those opposing the motion or appeal. All time 

used for consideration of the joint committee bill, including 

time used for quorum calls and voting, shall be counted against 

the total 30 hours of consideration. 

(4) NO AMENDMENTS.—An amendment to the joint committee bill, or a motion to postpone, or a motion to proceed 

to the consideration of other business, or a motion to recommit 

the joint committee bill, is not in order. 

(5) VOTE ON PASSAGE.—If the Senate has voted to proceed 

to the joint committee bill, the vote on passage of the joint 

committee bill shall occur immediately following the conclusion 

of the debate on a joint committee bill, and a single quorum 

call at the conclusion of the debate if requested. The vote 

on passage of the joint committee bill shall occur not later 

than December 23, 2011. 

(6) RULINGS OF THE CHAIR ON PROCEDURE.—Appeals from 

the decisions of the Chair relating to the application of the 

rules of the Senate, as the case may be, to the procedure 

Deadline. 

Waiver. 

Deadline. 


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PUBLIC LAW 112–25—AUG. 2, 2011 125 STAT. 265 

relating to a joint committee bill shall be decided without 

debate. 

(d) AMENDMENT.—The joint committee bill shall not be subject 

to amendment in either the House of Representatives or the Senate. 

(e) CONSIDERATION BY THE OTHER HOUSE.— (1) IN GENERAL.—If, before passing the joint committee 

bill, one House receives from the other a joint committee bill— 

(A) the joint committee bill of the other House shall 

not be referred to a committee; and 

(B) the procedure in the receiving House shall be the 

same as if no joint committee bill had been received from 

the other House until the vote on passage, when the joint 

committee bill received from the other House shall supplant 

the joint committee bill of the receiving House. 

(2) REVENUE MEASURE.—This subsection shall not apply 

to the House of Representatives if the joint committee bill 

received from the Senate is a revenue measure. 

(f) RULES TO COORDINATE ACTION WITH OTHER HOUSE.— (1) TREATMENT OF JOINT COMMITTEE BILL OF OTHER

HOUSE.—If the Senate fails to introduce or consider a joint 

committee bill under this section, the joint committee bill of 

the House shall be entitled to expedited floor procedures under 

this section. 

(2) TREATMENT OF COMPANION MEASURES IN THE SENATE.— If following passage of the joint committee bill in the Senate, 

the Senate then receives the joint committee bill from the 

House of Representatives, the House-passed joint committee 

bill shall not be debatable. The vote on passage of the joint 

committee bill in the Senate shall be considered to be the 

vote on passage of the joint committee bill received from the 

House of Representatives. 

(3) VETOES.—If the President vetoes the joint committee 

bill, debate on a veto message in the Senate under this section 

shall be 1 hour equally divided between the majority and 

minority leaders or their designees. 

(g) LOSS OF PRIVILEGE.—The provisions of this section shall 

cease to apply to the joint committee bill if— 

(1) the joint committee fails to vote on the report or proposed legislative language required under section 401(b)(3)(B)(i) 

not later than November 23, 2011; or 

(2) the joint committee bill does not pass both Houses 

not later than December 23, 2011. 

SEC. 403. FUNDING. 

Funding for the joint committee shall be derived in equal portions from— 

(1) the applicable accounts of the House of Representatives; 

and 

(2) the contingent fund of the Senate from the appropriations account ‘‘Miscellaneous Items’’, subject to the rules and 

regulations of the Senate. 

SEC. 404. RULEMAKING. 

The provisions of this title are enacted by Congress— 

(1) as an exercise of the rulemaking power of the House 

of Representatives and the Senate, respectively, and as such 

they shall be considered as part of the rules of each House, 

respectively, or of that House to which they specifically apply, 

2 USC 900 note. 

2 USC 900 note. 

Deadlines. 


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Department of the Navy Administrative Record for FY 2013 Furlough Appeals 390
125 STAT. 266 PUBLIC LAW 112–25—AUG. 2, 2011 

and such rules shall supersede other rules only to the extent 

that they are inconsistent therewith; and 

(2) with full recognition of the constitutional right of either 

House to change such rules (so far as relating to such House) 

at any time, in the same manner, and to the same extent 

as in the case of any other rule of such House. 

TITLE V—PELL GRANT AND STUDENT 

LOAN PROGRAM CHANGES 

SEC. 501. FEDERAL PELL GRANTS. 

Section 401(b)(7)(A)(iv) of the Higher Education Act of 1965 

(20 U.S.C. 1070a(b)(7)(A)(iv)) is amended— 

(1) in subclause (II), by striking ‘‘$3,183,000,000’’ and inserting ‘‘$13,183,000,000’’; and (2) in subclause (III), by striking ‘‘$0’’ and inserting ‘‘$7,000,000,000’’. 

SEC. 502. TERMINATION OF AUTHORITY TO MAKE INTEREST SUBSIDIZED LOANS TO GRADUATE AND PROFESSIONAL STUDENTS. 

Section 455(a) of the Higher Education Act of 1965 (20 U.S.C. 

1087e(a)) is amended by adding at the end the following new 

paragraph: 

‘‘(3) TERMINATION OF AUTHORITY TO MAKE INTEREST SUBSIDIZED LOANS TO GRADUATE AND PROFESSIONAL STUDENTS.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B) and 

notwithstanding any provision of this part or part B, for 

any period of instruction beginning on or after July 1, 

2012— 

‘‘(i) a graduate or professional student shall not 

be eligible to receive a Federal Direct Stafford loan 

under this part; and 

‘‘(ii) the maximum annual amount of Federal 

Direct Unsubsidized Stafford loans such a student may 

borrow in any academic year (as defined in section 

481(a)(2)) or its equivalent shall be the maximum 

annual amount for such student determined under section 428H, plus an amount equal to the amount of 

Federal Direct Stafford loans the student would have 

received in the absence of this subparagraph. 

‘‘(B) EXCEPTION.—Subparagraph (A) shall not apply 

to an individual enrolled in course work specified in paragraph (3)(B) or (4)(B) of section 484(b).’’. 

SEC. 503. TERMINATION OF DIRECT LOAN REPAYMENT INCENTIVES. 

Section 455(b)(8) of the Higher Education Act of 1965 (20 U.S.C. 

1087e(b)(8)) is amended— 

(1) in subparagraph (A)— 

(A) by amending the header to read as follows: ‘‘(A) 

INCENTIVES FOR LOANS DISBURSED BEFORE JULY 1, 2012.— 

’’; and 

(B) by inserting ‘‘with respect to loans for which the 

first disbursement of principal is made before July 1, 2012,’’ 

after ‘‘of this part’’; 


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PUBLIC LAW 112–25—AUG. 2, 2011 125 STAT. 267 

LEGISLATIVE HISTORY—S. 365: 

CONGRESSIONAL RECORD, Vol. 157 (2011): 

Feb. 17, considered and passed Senate. 

Aug. 1, considered and passed House, amended. 

Aug. 2, Senate concurred in House amendment. 

Æ 

(2) in subparagraph (B), by inserting ‘‘with respect to loans 

for which the first disbursement of principal is made before 

July 1, 2012’’ after ‘‘repayment incentives’’; and 

(3) by adding at the end the following new subparagraph: 

‘‘(C) NO REPAYMENT INCENTIVES FOR NEW LOANS DIS- BURSED ON OR AFTER JULY 1, 2012.—Notwithstanding any 

other provision of this part, the Secretary is prohibited 

from authorizing or providing any repayment incentive not 

otherwise authorized under this part to encourage on-time 

repayment of a loan under this part for which the first 

disbursement of principal is made on or after July 1, 2012, 

including any reduction in the interest or origination fee 

rate paid by a borrower of such a loan, except that the 

Secretary may provide for an interest rate reduction for 

a borrower who agrees to have payments on such a loan 

automatically electronically debited from a bank account.’’. 

SEC. 504. INAPPLICABILITY OF TITLE IV NEGOTIATED RULEMAKING 

AND MASTER CALENDAR EXCEPTION. 

Sections 482(c) and 492 of the Higher Education Act of 1965 

(20 U.S.C. 1089(c), 1098a) shall not apply to the amendments made 

by this title, or to any regulations promulgated under those amendments. 

Approved August 2, 2011. 

20 USC 1089 

note. 


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Department of the Navy Administrative Record for FY 2013 Furlough Appeals 392
DEPUTY SECRETARY OF DEFENSE 

1010 DEFENSE PENTAGON 

. WASHINGTON, DC 20301·1010 

MEMORANDUM FOR: SEE DISTRIBUTION 

SUBJECT: Guidance on Fiscal Year 2013 Joint Committee Sequestration 

SEP 2 5 2012 

The Budget Control Act of2011 (BCA) established the Joint Select Committee on 

Deficit Reduction (Joint Committee) and charged it with developing a proposal that would 

achieve at least $1.2 trillion in deficit reduction. Last November, the Joint Committee 

announced that it could not reach agreement on a deficit reduction plan. This failure triggered an 

enforcement mechanism of automatic funding cuts in Fiscal Year (FY) 2013, known as 

sequestration, above and beyond the reductions already reflected in the FY 2013 budget the 

Department submitted in February. The law requires the President to issue a sequestration order 

on January 2, 2013, to implement the required cuts unless Congress acts to avoid it. 

The additional funding cuts required under the BCA are very large. A recent report by 

the Office of Management and Budget (OMB) estimates that the cuts in the Department of 

Defense (DoD) budget would exceed $50 billion in FY 2013 alone. The law further requires that 

the FY 2013 cuts be implemented in an indiscriminate, across-the-board manner that will greatly 

exacerbate their adverse effects. These large cuts would lead to devastating effects on the 

Department and virtually every other Federal agency. For this reason, the Administration 

strongly believes that Congress needs to act to avoid sequestration by passing a balanced deficit 

reduction package that the President can sign. 

If Congress fails to enact balanced deficit reduction and avoid sequestration, DoD and 

other affected agencies must be prepared, under the BCA, to implement sequestration on January 

2, 2013. On July 31, 2012, OMB issued the attached guidance informing agencies that OMB 

will be consulting with them on matters related to the issuance of the sequestration order. Over 

the longer term, in the absence of congressional action on a balanced deficit reduction plan in 

advance of January 2, 2013, OMB will undertake additional activities related to the 

implementation ofthe sequestration. Within DoD, the Under Secretary of Defense (Comptroller) 

will take the lead in these efforts and, working with OMB as necessary, will ensure that the 

Department is ready to implement sequestration in January if it occurs. 

080011885-12 

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Department of the Navy Administrative Record for FY 2013 Furlough Appeals 393
In the meantime, consistent with OMB guidance, DoD needs to continue normal 

spending and operations. We do not want our programs, personnel, and activities to begin to 

suffer the harmful effects of sequestration while there is still a chance it can be avoided. I am 

therefore directing that all commanders and managers in the Department of Defense continue the 

defense mission under current laws and policies, without taking any steps that assume 

sequestration will occur. Commanders should not, for example, curtail planned training, 

maintenance, healthcare or family programs. Commanders and managers should not alarm our 

employees and their families by announcing personnel actions related to sequestration or by 

suggesting that these actions are likely. Nor should commanders and managers hold back on the 

obligation of funds - either for investments or for operating programs - if those funds would 

have been obligated in the absence ofthe sequester threat. 

If you have questions about this guidance, please consult your chain of command. 

Addressees on this memo who have questions should direct them to the Under Secretary of 

Defense (Comptroller). 

Attachment: 

As stated 

2 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 394
SECRETARY OF DEFENSE 

1000 DEFENSE PENTAGON 

WASHINGTON. DC 20301·1000 

MEMORANDUM FOR: SEE DISTR1BUTION 

SUBJECT: Implications of Ongoing Fiscal Cliff Negotiations 

DEC 2 0 2012 

We are providing you Ibis infonnation regarding the porential Impact of seqUestration 

here at DoD. As you are all likely aware, the Administration and Congress are continuing to 

work to resolve a series of economic or fiscal events, collectively referred to as the "fiscal cliff," 

that are scheduled to oocur around the end of the year. One of the key issues involves porential 

acrosg...the-board reductions in Federal spending-also known as "sequestration"-which were 

put in place by the Budget Control Act of 20 I !. Under current law, these reductions are 

scheduled to take effect on January 2, 2013. Many of you have raised questions regarding the 

impact of a potential sequestration fur the Department of Defense, and I would like to take a 

moment to clarify a few things. 

I want to start by noting that titis past summer, the President indicated his intent to 

exercise his legal authority to exempt military personnel funding from sequestration. This means 

that military endatrength will not be affected by sequestration in FY2013. 

Our civilian employees should keep in mind that the Adminisumion remains focused on 

working with Congress to reach agreement on a balanced deficit reduction pian that avoids such 

cuts. Sequestration was never intended to be implemented, and there is no reason why both sides 

should not be able to come togethar and prevent titis scenario. 

Nevertheless, with only a coople of weeks left before sequestration could occur should a 

deal not be reuched, it is important to clarifY the potential implications. Let me start by 

explaining what sequestration is and what it is not. Sequestration is an across-the-beard 

reduction in budgetary resources for all acconnts within the Department of Defense that have not 

been exempted by Congress. If it occurs, sequestration will reduoe our budgetary resources for 

the remainder of the fiscal year (which runs through Seplember 30). These cuts, while 

significant and harmful to our collective mission as an agency, would not neCessarily require 

immediate reductions in spending. Under sequestration, we would still have funds available 

after January 2, 2013, but our overall funding for the remainder of the year would be reduced. 

Accordingly. this situation is different from other scenarios we have encountered in recent years. 

such as threats of government shutdown due to a lapse in-appropriations. 

For these reasons. I do not expect our day~to~ay operations to change dramatically on or 

immediately after January 2, 2013, should sequestration occur. This means that we will not be 

executing any immediate civilian personnel actions. such as furloughs. on that date. Should we 

have to operate tmder reduced funding levels for an extended period of time, we may have to 

consider furloughs or other actions in the future. But let me assure you that we will carefully 

examine other options to reduce costs within the agency before taking such action. taking into 

080015618-12 

ftf=Af!- tioWiar IJ T'Jb 2 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 395
consideration our obligation to execute our core mission. Moreover, if such action proves 10 be 

necessary, we would provide affected employees the requisite advance notice before a furlough 

or other personnel action would occur. We would also immediately cancel any scheduled 

personnel actions should a deficit reduction agreement be reached that restores our agency 

funding. 

I want to assure you that we wi11 do our very best to provide clear information about the 

status of events as they unfold. 

Finally, let me express my gratitude during this holiday season for your continued hard 

work and dedication to the vital mission of the Department of Defense. Your co-ntributions touch 

people~s lives in many significant ways. and I want you to know how deeply appreciative the 

President and myself are for all that you do. 

DISTRIBUTION: 

SECRETARIES OF lHE MILITARY DEPARTMENTS 

CHAIRMAN OF lHE JOINT CHIEFS OF STAFF 

UNDER SECRETARIES OF DEFENSE 

DEPUTY CHIEF MANAGEMENT OFFICER 

COMMANDERS OF lHE COMBATANT COMMANDS 

DIRECTOR, COST ASSESSMENT AND PROGRAM EVALUATION 

DIRECTOR, OPERATIONAL TEST AND EVALUATION 

GENERAL COUNSEL OF THE DEPARTMENT OF DEFENSE 

INSPECTOR GENERAL OF lHE DEPARTMENT OF DEFENSE 

ASSISTANT SECRETARIES OF DEFENSE 

DEPARTMENT OF DEFENSE CHIEF INFORMATION OFFICER 

ASSISTANTS TO THE SECRETARY OF DEFENSE 

DIRECTOR, ADMINISTRATION AND MANAGEMENT 

DIRECTOR, NET ASSESSMENT 

DIRECTORS OF lHE DEFENSE AGENCIES 

DIRECTORS OF THE DOD FIELD ACTIVITIES 

2 

. ' .. ~. ' ' ·l-:· -l- ·-~ 

' ' 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 396
H. R. 8 

One Hundred Twelfth Congress 

of the 

United States of America 

AT THE SECOND SESSION 

Begun and held at the City of Washington on Tuesday, 

the third day of January, two thousand and twelve 

An Act 

Entitled the ‘‘American Taxpayer Relief Act of 2012’’. 

Be it enacted by the Senate and House of Representatives of 

the United States of America in Congress assembled, 

SECTION 1. SHORT TITLE, ETC. 

(a) SHORT TITLE.—This Act may be cited as the ‘‘American 

Taxpayer Relief Act of 2012’’. 

(b) AMENDMENT OF 1986 CODE.—Except as otherwise expressly 

provided, whenever in this Act an amendment or repeal is expressed 

in terms of an amendment to, or repeal of, a section or other 

provision, the reference shall be considered to be made to a section 

or other provision of the Internal Revenue Code of 1986. 

(c) TABLE OF CONTENTS.—The table of contents for this Act 

is as follows: 

Sec. 1. Short title, etc. 

TITLE I—GENERAL EXTENSIONS 

Sec. 101. Permanent extension and modification of 2001 tax relief. 

Sec. 102. Permanent extension and modification of 2003 tax relief. 

Sec. 103. Extension of 2009 tax relief. 

Sec. 104. Permanent alternative minimum tax relief. 

TITLE II—INDIVIDUAL TAX EXTENDERS 

Sec. 201. Extension of deduction for certain expenses of elementary and secondary 

school teachers. 

Sec. 202. Extension of exclusion from gross income of discharge of qualified principal residence indebtedness. 

Sec. 203. Extension of parity for exclusion from income for employer-provided mass 

transit and parking benefits. 

Sec. 204. Extension of mortgage insurance premiums treated as qualified residence 

interest. 

Sec. 205. Extension of deduction of State and local general sales taxes. 

Sec. 206. Extension of special rule for contributions of capital gain real property 

made for conservation purposes. 

Sec. 207. Extension of above-the-line deduction for qualified tuition and related expenses. 

Sec. 208. Extension of tax-free distributions from individual retirement plans for 

charitable purposes. 

Sec. 209. Improve and make permanent the provision authorizing the Internal Revenue Service to disclose certain return and return information to certain 

prison officials. 

TITLE III—BUSINESS TAX EXTENDERS 

Sec. 301. Extension and modification of research credit. 

Sec. 302. Extension of temporary minimum low-income tax credit rate for non-federally subsidized new buildings. 

Sec. 303. Extension of housing allowance exclusion for determining area median 

gross income for qualified residential rental project exempt facility 

bonds. 

Sec. 304. Extension of Indian employment tax credit. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 397
H. R. 8—2 

Sec. 305. Extension of new markets tax credit. 

Sec. 306. Extension of railroad track maintenance credit. 

Sec. 307. Extension of mine rescue team training credit. 

Sec. 308. Extension of employer wage credit for employees who are active duty 

members of the uniformed services. 

Sec. 309. Extension of work opportunity tax credit. 

Sec. 310. Extension of qualified zone academy bonds. 

Sec. 311. Extension of 15-year straight-line cost recovery for qualified leasehold improvements, qualified restaurant buildings and improvements, and 

qualified retail improvements. Sec. 312. Extension of 7-year recovery period for motorsports entertainment complexes. Sec. 313. Extension of accelerated depreciation for business property on an Indian 

reservation. 

Sec. 314. Extension of enhanced charitable deduction for contributions of food inventory. Sec. 315. Extension of increased expensing limitations and treatment of certain 

real property as section 179 property. Sec. 316. Extension of election to expense mine safety equipment. 

Sec. 317. Extension of special expensing rules for certain film and television productions. 

Sec. 318. Extension of deduction allowable with respect to income attributable to 

domestic production activities in Puerto Rico. Sec. 319. Extension of modification of tax treatment of certain payments to controlling exempt organizations. Sec. 320. Extension of treatment of certain dividends of regulated investment companies. Sec. 321. Extension of RIC qualified investment entity treatment under FIRPTA. 

Sec. 322. Extension of subpart F exception for active financing income. 

Sec. 323. Extension of look-thru treatment of payments between related controlled 

foreign corporations under foreign personal holding company rules. Sec. 324. Extension of temporary exclusion of 100 percent of gain on certain small 

business stock. 

Sec. 325. Extension of basis adjustment to stock of S corporations making charitable contributions of property. Sec. 326. Extension of reduction in S-corporation recognition period for built-in 

gains tax. Sec. 327. Extension of empowerment zone tax incentives. 

Sec. 328. Extension of tax-exempt financing for New York Liberty Zone. 

Sec. 329. Extension of temporary increase in limit on cover over of rum excise taxes 

to Puerto Rico and the Virgin Islands. Sec. 330. Modification and extension of American Samoa economic development 

credit. 

Sec. 331. Extension and modification of bonus depreciation. 

TITLE IV—ENERGY TAX EXTENDERS 

Sec. 401. Extension of credit for energy-efficient existing homes. 

Sec. 402. Extension of credit for alternative fuel vehicle refueling property. 

Sec. 403. Extension of credit for 2- or 3-wheeled plug-in electric vehicles. 

Sec. 404. Extension and modification of cellulosic biofuel producer credit. 

Sec. 405. Extension of incentives for biodiesel and renewable diesel. 

Sec. 406. Extension of production credit for Indian coal facilities placed in service 

before 2009. 

Sec. 407. Extension and modification of credits with respect to facilities producing 

energy from certain renewable resources. Sec. 408. Extension of credit for energy-efficient new homes. 

Sec. 409. Extension of credit for energy-efficient appliances. 

Sec. 410. Extension and modification of special allowance for cellulosic biofuel plant 

property. Sec. 411. Extension of special rule for sales or dispositions to implement FERC or 

State electric restructuring policy for qualified electric utilities. Sec. 412. Extension of alternative fuels excise tax credits. 

TITLE V—UNEMPLOYMENT 

Sec. 501. Extension of emergency unemployment compensation program. 

Sec. 502. Temporary extension of extended benefit provisions. 

Sec. 503. Extension of funding for reemployment services and reemployment and 

eligibility assessment activities. Sec. 504. Additional extended unemployment benefits under the Railroad Unemployment Insurance Act. 

TITLE VI—MEDICARE AND OTHER HEALTH EXTENSIONS 

Subtitle A—Medicare Extensions 

Sec. 601. Medicare physician payment update. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 398
H. R. 8—3 

Sec. 602. Work geographic adjustment. 

Sec. 603. Payment for outpatient therapy services. 

Sec. 604. Ambulance add-on payments. 

Sec. 605. Extension of Medicare inpatient hospital payment adjustment for low-volume hospitals. Sec. 606. Extension of the Medicare-dependent hospital (MDH) program. 

Sec. 607. Extension for specialized Medicare Advantage plans for special needs individuals. 

Sec. 608. Extension of Medicare reasonable cost contracts. 

Sec. 609. Performance improvement. 

Sec. 610. Extension of funding outreach and assistance for low-income programs. 

Subtitle B—Other Health Extensions 

Sec. 621. Extension of the qualifying individual (QI) program. 

Sec. 622. Extension of Transitional Medical Assistance (TMA). 

Sec. 623. Extension of Medicaid and CHIP Express Lane option. 

Sec. 624. Extension of family-to-family health information centers. 

Sec. 625. Extension of Special Diabetes Program for Type I diabetes and for Indians. 

Subtitle C—Other Health Provisions 

Sec. 631. IPPS documentation and coding adjustment for implementation of MSDRGs. 

Sec. 632. Revisions to the Medicare ESRD bundled payment system to reflect findings in the GAO report. Sec. 633. Treatment of multiple service payment policies for therapy services. 

Sec. 634. Payment for certain radiology services furnished under the Medicare hospital outpatient department prospective payment system. Sec. 635. Adjustment of equipment utilization rate for advanced imaging services. 

Sec. 636. Medicare payment of competitive prices for diabetic supplies and elimination of overpayment for diabetic supplies. Sec. 637. Medicare payment adjustment for non-emergency ambulance transports 

for ESRD beneficiaries. 

Sec. 638. Removing obstacles to collection of overpayments. 

Sec. 639. Medicare advantage coding intensity adjustment. 

Sec. 640. Elimination of all funding for the Medicare Improvement Fund. 

Sec. 641. Rebasing of State DSH allotments. 

Sec. 642. Repeal of CLASS program. 

Sec. 643. Commission on Long-Term Care. 

Sec. 644. Consumer Operated and Oriented Plan program contingency fund. 

TITLE VII—EXTENSION OF AGRICULTURAL PROGRAMS 

Sec. 701. 1-year extension of agricultural programs. 

Sec. 702. Supplemental agricultural disaster assistance. 

TITLE VIII—MISCELLANEOUS PROVISIONS 

Sec. 801. Strategic delivery systems. 

Sec. 802. No cost of living adjustment in pay of members of congress. 

TITLE IX—BUDGET PROVISIONS 

Subtitle A—Modifications of Sequestration 

Sec. 901. Treatment of sequester. 

Sec. 902. Amounts in applicable retirement plans may be transferred to designated 

Roth accounts without distribution. 

Subtitle B—Budgetary Effects 

Sec. 911. Budgetary effects. 

TITLE I—GENERAL EXTENSIONS 

SEC. 101. PERMANENT EXTENSION AND MODIFICATION OF 2001 TAX 

RELIEF. 

(a) PERMANENT EXTENSION.— (1) IN GENERAL.—The Economic Growth and Tax Relief 

Reconciliation Act of 2001 is amended by striking title IX. 

(2) CONFORMING AMENDMENT.—The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 

is amended by striking section 304. 

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(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to taxable, plan, or limitation years beginning after December 31, 2012, and estates of decedents dying, 

gifts made, or generation skipping transfers after December 

31, 2012. 

(b) APPLICATION OF INCOME TAX TO CERTAIN HIGH-INCOME

TAXPAYERS.— 

(1) INCOME TAX RATES.— 

(A) TREATMENT OF 25-, 28-, AND 33-PERCENT RATE

BRACKETS.—Paragraph (2) of section 1(i) is amended to 

read as follows: 

‘‘(2) 25-, 28-, AND 33-PERCENT RATE BRACKETS.—The tables 

under subsections (a), (b), (c), (d), and (e) shall be applied— 

‘‘(A) by substituting ‘25%’ for ‘28%’ each place it 

appears (before the application of subparagraph (B)), 

‘‘(B) by substituting ‘28%’ for ‘31%’ each place it 

appears, and 

‘‘(C) by substituting ‘33%’ for ‘36%’ each place it 

appears.’’. 

(B) 35-PERCENT RATE BRACKET.—Subsection (i) of section 1 is amended by redesignating paragraph (3) as paragraph (4) and by inserting after paragraph (2) the following 

new paragraph: 

‘‘(3) MODIFICATIONS TO INCOME TAX BRACKETS FOR HIGHINCOME TAXPAYERS.— 

‘‘(A) 35-PERCENT RATE BRACKET.—In the case of taxable 

years beginning after December 31, 2012— 

‘‘(i) the rate of tax under subsections (a), (b), (c), 

and (d) on a taxpayer’s taxable income in the highest 

rate bracket shall be 35 percent to the extent such 

income does not exceed an amount equal to the excess 

of— 

‘‘(I) the applicable threshold, over 

‘‘(II) the dollar amount at which such bracket 

begins, and 

‘‘(ii) the 39.6 percent rate of tax under such subsections shall apply only to the taxpayer’s taxable 

income in such bracket in excess of the amount to 

which clause (i) applies. 

‘‘(B) APPLICABLE THRESHOLD.—For purposes of this 

paragraph, the term ‘applicable threshold’ means— 

‘‘(i) $450,000 in the case of subsection (a), 

‘‘(ii) $425,000 in the case of subsection (b), 

‘‘(iii) $400,000 in the case of subsection (c), and 

‘‘(iv) 1⁄2 the amount applicable under clause (i) 

(after adjustment, if any, under subparagraph (C)) in 

the case of subsection (d). 

‘‘(C) INFLATION ADJUSTMENT.—For purposes of this 

paragraph, with respect to taxable years beginning in calendar years after 2013, each of the dollar amounts under 

clauses (i), (ii), and (iii) of subparagraph (B) shall be 

adjusted in the same manner as under paragraph (1)(C)(i), 

except that subsection (f)(3)(B) shall be applied by substituting ‘2012’ for ‘1992’.’’. 

(2) PHASEOUT OF PERSONAL EXEMPTIONS AND ITEMIZED

DEDUCTIONS.— 

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(A) OVERALL LIMITATION ON ITEMIZED DEDUCTIONS.— 

Section 68 is amended— 

(i) by striking subsection (b) and inserting the 

following: 

‘‘(b) APPLICABLE AMOUNT.— 

‘‘(1) IN GENERAL.—For purposes of this section, the term 

‘applicable amount’ means— 

‘‘(A) $300,000 in the case of a joint return or a surviving 

spouse (as defined in section 2(a)), 

‘‘(B) $275,000 in the case of a head of household (as 

defined in section 2(b)), 

‘‘(C) $250,000 in the case of an individual who is not 

married and who is not a surviving spouse or head of 

household, and 

‘‘(D) 1⁄2 the amount applicable under subparagraph 

(A) (after adjustment, if any, under paragraph (2)) in the 

case of a married individual filing a separate return. 

For purposes of this paragraph, marital status shall be determined under section 7703. 

‘‘(2) INFLATION ADJUSTMENT.—In the case of any taxable 

year beginning in calendar years after 2013, each of the dollar 

amounts under subparagraphs (A), (B), and (C) of paragraph 

(1) shall be shall be increased by an amount equal to— 

‘‘(A) such dollar amount, multiplied by 

‘‘(B) the cost-of-living adjustment determined under 

section 1(f)(3) for the calendar year in which the taxable 

year begins, except that section 1(f)(3)(B) shall be applied 

by substituting ‘2012’ for ‘1992’. 

If any amount after adjustment under the preceding sentence 

is not a multiple of $50, such amount shall be rounded to 

the next lowest multiple of $50.’’, and 

(ii) by striking subsections (f) and (g). 

(B) PHASEOUT OF DEDUCTIONS FOR PERSONAL EXEMP- TIONS.— (i) IN GENERAL.—Paragraph (3) of section 151(d) 

is amended— 

(I) by striking ‘‘the threshold amount’’ in subparagraphs (A) and (B) and inserting ‘‘the 

applicable amount in effect under section 68(b)’’, 

(II) by striking subparagraph (C) and redesignating subparagraph (D) as subparagraph (C), and 

(III) by striking subparagraphs (E) and (F). 

(ii) CONFORMING AMENDMENTS.—Paragraph (4) of 

section 151(d) is amended— 

(I) by striking subparagraph (B), 

(II) by redesignating clauses (i) and (ii) of 

subparagraph (A) as subparagraphs (A) and (B), 

respectively, and by indenting such subparagraphs 

(as so redesignated) accordingly, and 

(III) by striking all that precedes ‘‘in a calendar year after 1989,’’ and inserting the following: 

‘‘(4) INFLATION ADJUSTMENT.—In the case of any taxable 

year beginning’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to taxable years beginning after December 

31, 2012. 

(c) MODIFICATIONS OF ESTATE TAX.— 

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(1) MAXIMUM ESTATE TAX RATE EQUAL TO 40 PERCENT.— 

The table contained in subsection (c) of section 2001, as 

amended by section 302(a)(2) of the Tax Relief, Unemployment 

Insurance Reauthorization, and Job Creation Act of 2010, is 

amended by striking ‘‘Over $500,000’’ and all that follows and 

inserting the following: 

‘‘Over $500,000 but not over 

$750,000.

$155,800, plus 37 percent of the 

excess of such amount over 

$500,000. 

Over $750,000 but not over 

$1,000,000.

$248,300, plus 39 percent of the 

excess of such amount over 

$750,000. 

Over $1,000,000 .......................... $345,800, plus 40 percent of the 

excess of such amount over 

$1,000,000.’’. 

(2) TECHNICAL CORRECTION.—Clause (i) of section 

2010(c)(4)(B) is amended by striking ‘‘basic exclusion amount’’ 

and inserting ‘‘applicable exclusion amount’’. 

(3) EFFECTIVE DATES.— 

(A) IN GENERAL.—Except as otherwise provided by in 

this paragraph, the amendments made by this subsection 

shall apply to estates of decedents dying, generation-skipping transfers, and gifts made, after December 31, 2012. 

(B) TECHNICAL CORRECTION.—The amendment made 

by paragraph (2) shall take effect as if included in the 

amendments made by section 303 of the Tax Relief, 

Unemployment Insurance Reauthorization, and Job Creation Act of 2010. 

SEC. 102. PERMANENT EXTENSION AND MODIFICATION OF 2003 TAX 

RELIEF. 

(a) PERMANENT EXTENSION.—The Jobs and Growth Tax Relief 

Reconciliation Act of 2003 is amended by striking section 303. 

(b) 20-PERCENT CAPITAL GAINS RATE FOR CERTAIN HIGH

INCOME INDIVIDUALS.— 

(1) IN GENERAL.—Paragraph (1) of section 1(h) is amended 

by striking subparagraph (C), by redesignating subparagraphs 

(D) and (E) as subparagraphs (E) and (F) and by inserting 

after subparagraph (B) the following new subparagraphs: 

‘‘(C) 15 percent of the lesser of— 

‘‘(i) so much of the adjusted net capital gain (or, 

if less, taxable income) as exceeds the amount on which 

a tax is determined under subparagraph (B), or 

‘‘(ii) the excess of— 

‘‘(I) the amount of taxable income which would 

(without regard to this paragraph) be taxed at 

a rate below 39.6 percent, over 

‘‘(II) the sum of the amounts on which a tax 

is determined under subparagraphs (A) and (B), 

‘‘(D) 20 percent of the adjusted net capital gain (or, 

if less, taxable income) in excess of the sum of the amounts 

on which tax is determined under subparagraphs (B) and 

(C),’’. 

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(2) MINIMUM TAX.—Paragraph (3) of section 55(b) is 

amended by striking subparagraph (C), by redesignating 

subparagraph (D) as subparagraph (E), and by inserting after 

subparagraph (B) the following new subparagraphs: 

‘‘(C) 15 percent of the lesser of— 

‘‘(i) so much of the adjusted net capital gain (or, 

if less, taxable excess) as exceeds the amount on which 

tax is determined under subparagraph (B), or 

‘‘(ii) the excess described in section 1(h)(1)(C)(ii), 

plus 

‘‘(D) 20 percent of the adjusted net capital gain (or, 

if less, taxable excess) in excess of the sum of the amounts 

on which tax is determined under subparagraphs (B) and 

(C), plus’’. 

(c) CONFORMING AMENDMENTS.— 

(1) The following provisions are each amended by striking 

‘‘15 percent’’ and inserting ‘‘20 percent’’: 

(A) Section 531. 

(B) Section 541. 

(C) Section 1445(e)(1). 

(D) The second sentence of section 7518(g)(6)(A). 

(E) Section 53511(f)(2) of title 46, United States Code. 

(2) Sections 1(h)(1)(B) and 55(b)(3)(B) are each amended 

by striking ‘‘5 percent (0 percent in the case of taxable years 

beginning after 2007)’’ and inserting ‘‘0 percent’’. 

(3) Section 1445(e)(6) is amended by striking ‘‘15 percent 

(20 percent in the case of taxable years beginning after 

December 31, 2010)’’ and inserting ‘‘20 percent’’. 

(d) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as otherwise provided, the amendments made by subsections (b) and (c) shall apply to taxable 

years beginning after December 31, 2012. 

(2) WITHHOLDING.—The amendments made by paragraphs 

(1)(C) and (3) of subsection (c) shall apply to amounts paid 

on or after January 1, 2013. 

SEC. 103. EXTENSION OF 2009 TAX RELIEF. 

(a) 5-YEAR EXTENSION OF AMERICAN OPPORTUNITY TAX

CREDIT.— 

(1) IN GENERAL.—Section 25A(i) is amended by striking 

‘‘in 2009, 2010, 2011, or 2012’’ and inserting ‘‘after 2008 and 

before 2018’’. 

(2) TREATMENT OF POSSESSIONS.—Section 1004(c)(1) of division B of the American Recovery and Reinvestment Tax Act 

of 2009 is amended by striking ‘‘in 2009, 2010, 2011, and 

2012’’ each place it appears and inserting ‘‘after 2008 and 

before 2018’’. 

(b) 5-YEAR EXTENSION OF CHILD TAX CREDIT.—Section 24(d)(4) 

is amended— 

(1) by striking ‘‘2009, 2010, 2011, AND 2012’’ in the heading 

and inserting ‘‘FOR CERTAIN YEARS’’, and 

(2) by striking ‘‘in 2009, 2010, 2011, or 2012’’ and inserting 

‘‘after 2008 and before 2018’’. 

(c) 5-YEAR EXTENSION OF EARNED INCOME TAX CREDIT.—Section 

32(b)(3) is amended— 

(1) by striking ‘‘2009, 2010, 2011, AND 2012’’ in the heading 

and inserting ‘‘FOR CERTAIN YEARS’’, and 

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(2) by striking ‘‘in 2009, 2010, 2011, or 2012’’ and inserting 

‘‘after 2008 and before 2018’’. 

(d) PERMANENT EXTENSION OF RULE DISREGARDING REFUNDS

IN THE ADMINISTRATION OF FEDERAL PROGRAMS AND FEDERALLY

ASSISTED PROGRAMS.—Section 6409 is amended to read as follows: 

‘‘SEC. 6409. REFUNDS DISREGARDED IN THE ADMINISTRATION OF FEDERAL PROGRAMS AND FEDERALLY ASSISTED PROGRAMS. 

‘‘Notwithstanding any other provision of law, any refund (or 

advance payment with respect to a refundable credit) made to 

any individual under this title shall not be taken into account 

as income, and shall not be taken into account as resources for 

a period of 12 months from receipt, for purposes of determining 

the eligibility of such individual (or any other individual) for benefits 

or assistance (or the amount or extent of benefits or assistance) 

under any Federal program or under any State or local program 

financed in whole or in part with Federal funds.’’. 

(e) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as provided in paragraph (2), the 

amendments made by this section shall apply to taxable years 

beginning after December 31, 2012. 

(2) RULE REGARDING DISREGARD OF REFUNDS.—The amendment made by subsection (d) shall apply to amounts received 

after December 31, 2012. 

SEC. 104. PERMANENT ALTERNATIVE MINIMUM TAX RELIEF. 

(a) 2012 EXEMPTION AMOUNTS MADE PERMANENT.— (1) IN GENERAL.—Paragraph (1) of section 55(d) is 

amended— 

(A) by striking ‘‘$45,000’’ and all that follows through ‘‘2011)’’ in subparagraph (A) and inserting ‘‘$78,750’’, (B) by striking ‘‘$33,750’’ and all that follows through ‘‘2011)’’ in subparagraph (B) and inserting ‘‘$50,600’’, and 

(C) by striking ‘‘paragraph (1)(A)’’ in subparagraph (C) 

and inserting ‘‘subparagraph (A)’’. 

(b) EXEMPTION AMOUNTS INDEXED FOR INFLATION.— (1) IN GENERAL.—Subsection (d) of section 55 is amended 

by adding at the end the following new paragraph: 

‘‘(4) INFLATION ADJUSTMENT.— 

‘‘(A) IN GENERAL.—In the case of any taxable year 

beginning in a calendar year after 2012, the amounts 

described in subparagraph (B) shall each be increased by 

an amount equal to— 

‘‘(i) such dollar amount, multiplied by 

‘‘(ii) the cost-of-living adjustment determined 

under section 1(f)(3) for the calendar year in which 

the taxable year begins, determined by substituting 

‘calendar year 2011’ for ‘calendar year 1992’ in 

subparagraph (B) thereof. 

‘‘(B) AMOUNTS DESCRIBED.—The amounts described in 

this subparagraph are— 

‘‘(i) each of the dollar amounts contained in subsection (b)(1)(A)(i), 

‘‘(ii) each of the dollar amounts contained in paragraph (1), and 

‘‘(iii) each of the dollar amounts in subparagraphs 

(A) and (B) of paragraph (3). 

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‘‘(C) ROUNDING.—Any increase determined under 

subparagraph (A) shall be rounded to the nearest multiple 

of $100.’’. 

(2) CONFORMING AMENDMENTS.— 

(A) Clause (iii) of section 55(b)(1)(A) is amended by 

striking ‘‘by substituting’’ and all that follows through 

‘‘appears.’’ and inserting ‘‘by substituting 50 percent of 

the dollar amount otherwise applicable under subclause 

(I) and subclause (II) thereof.’’. 

(B) Paragraph (3) of section 55(d) is amended— 

(i) by striking ‘‘or (2)’’ in subparagraph (A), 

(ii) by striking ‘‘and’’ at the end of subparagraph 

(B), and 

(iii) by striking subparagraph (C) and inserting 

the following new subparagraphs: 

‘‘(C) 50 percent of the dollar amount applicable under 

subparagraph (A) in the case of a taxpayer described in 

subparagraph (C) or (D) of paragraph (1), and 

‘‘(D) $150,000 in the case of a taxpayer described in 

paragraph (2).’’. 

(c) ALTERNATIVE MINIMUM TAX RELIEF FOR NONREFUNDABLE

CREDITS.— 

(1) IN GENERAL.—Subsection (a) of section 26 is amended 

to read as follows: 

‘‘(a) LIMITATION BASED ON AMOUNT OF TAX.—The aggregate 

amount of credits allowed by this subpart for the taxable year 

shall not exceed the sum of— 

‘‘(1) the taxpayer’s regular tax liability for the taxable 

year reduced by the foreign tax credit allowable under section 

27(a), and 

‘‘(2) the tax imposed by section 55(a) for the taxable year.’’. 

(2) CONFORMING AMENDMENTS.— 

(A) ADOPTION CREDIT.— (i) Section 23(b) is amended by striking paragraph 

(4). 

(ii) Section 23(c) is amended by striking paragraphs (1) and (2) and inserting the following: 

‘‘(1) IN GENERAL.—If the credit allowable under subsection 

(a) for any taxable year exceeds the limitation imposed by 

section 26(a) for such taxable year reduced by the sum of 

the credits allowable under this subpart (other than this section 

and sections 25D and 1400C), such excess shall be carried 

to the succeeding taxable year and added to the credit allowable 

under subsection (a) for such taxable year.’’. 

(iii) Section 23(c) is amended by redesignating 

paragraph (3) as paragraph (2). 

(B) CHILD TAX CREDIT.— (i) Section 24(b) is amended by striking paragraph 

(3). 

(ii) Section 24(d)(1) is amended— 

(I) by striking ‘‘section 26(a)(2) or subsection 

(b)(3), as the case may be,’’ each place it appears 

in subparagraphs (A) and (B) and inserting ‘‘section 26(a)’’, and 

(II) by striking ‘‘section 26(a)(2) or subsection 

(b)(3), as the case may be’’ in the second last 

sentence and inserting ‘‘section 26(a)’’. 

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(C) CREDIT FOR INTEREST ON CERTAIN HOME MORTGAGES.—Section 25(e)(1)(C) is amended to read as follows: 

‘‘(C) APPLICABLE TAX LIMIT.—For purposes of this paragraph, the term ‘applicable tax limit’ means the limitation 

imposed by section 26(a) for the taxable year reduced by 

the sum of the credits allowable under this subpart (other 

than this section and sections 23, 25D, and 1400C).’’. 

(D) HOPE AND LIFETIME LEARNING CREDITS.—Section 

25A(i) is amended— 

(i) by striking paragraph (5) and by redesignating 

paragraphs (6) and (7) as paragraphs (5) and (6), 

respectively, and 

(ii) by striking ‘‘section 26(a)(2) or paragraph (5), 

as the case may be’’ in paragraph (5), as redesignated 

by clause (i), and inserting ‘‘section 26(a)’’. 

(E) SAVERS’ CREDIT.—Section 25B is amended by 

striking subsection (g). 

(F) RESIDENTIAL ENERGY EFFICIENT PROPERTY.—Section 

25D(c) is amended to read as follows: 

‘‘(c) CARRYFORWARD OF UNUSED CREDIT.—If the credit allowable 

under subsection (a) exceeds the limitation imposed by section 

26(a) for such taxable year reduced by the sum of the credits 

allowable under this subpart (other than this section), such excess 

shall be carried to the succeeding taxable year and added to the 

credit allowable under subsection (a) for such succeeding taxable 

year.’’. 

(G) CERTAIN PLUG-IN ELECTRIC VEHICLES.—Section 

30(c)(2) is amended to read as follows: 

‘‘(2) PERSONAL CREDIT.—For purposes of this title, the credit 

allowed under subsection (a) for any taxable year (determined 

after application of paragraph (1)) shall be treated as a credit 

allowable under subpart A for such taxable year.’’. 

(H) ALTERNATIVE MOTOR VEHICLE CREDIT.—Section 

30B(g)(2) is amended to read as follows: 

‘‘(2) PERSONAL CREDIT.—For purposes of this title, the credit 

allowed under subsection (a) for any taxable year (determined 

after application of paragraph (1)) shall be treated as a credit 

allowable under subpart A for such taxable year.’’. 

(I) NEW QUALIFIED PLUG-IN ELECTRIC VEHICLE

CREDIT.—Section 30D(c)(2) is amended to read as follows: 

‘‘(2) PERSONAL CREDIT.—For purposes of this title, the credit 

allowed under subsection (a) for any taxable year (determined 

after application of paragraph (1)) shall be treated as a credit 

allowable under subpart A for such taxable year.’’. 

(J) CROSS REFERENCES.—Section 55(c)(3) is amended 

by striking ‘‘26(a), 30C(d)(2),’’ and inserting ‘‘30C(d)(2)’’. 

(K) FOREIGN TAX CREDIT.—Section 904 is amended by 

striking subsection (i) and by redesignating subsections 

(j), (k), and (l) as subsections (i), (j), and (k), respectively. 

(L) FIRST-TIME HOME BUYER CREDIT FOR THE DISTRICT

OF COLUMBIA.—Section 1400C(d) is amended to read as 

follows: 

‘‘(d) CARRYFORWARD OF UNUSED CREDIT.—If the credit allowable 

under subsection (a) exceeds the limitation imposed by section 

26(a) for such taxable year reduced by the sum of the credits 

allowable under subpart A of part IV of subchapter A (other than 

this section and section 25D), such excess shall be carried to the 

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succeeding taxable year and added to the credit allowable under 

subsection (a) for such taxable year.’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

TITLE II—INDIVIDUAL TAX EXTENDERS 

SEC. 201. EXTENSION OF DEDUCTION FOR CERTAIN EXPENSES OF 

ELEMENTARY AND SECONDARY SCHOOL TEACHERS. 

(a) IN GENERAL.—Subparagraph (D) of section 62(a)(2) is 

amended by striking ‘‘or 2011’’ and inserting ‘‘2011, 2012, or 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 202. EXTENSION OF EXCLUSION FROM GROSS INCOME OF DISCHARGE OF QUALIFIED PRINCIPAL RESIDENCE INDEBTEDNESS. 

(a) IN GENERAL.—Subparagraph (E) of section 108(a)(1) is 

amended by striking ‘‘January 1, 2013’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to indebtedness discharged after December 31, 2012. 

SEC. 203. EXTENSION OF PARITY FOR EXCLUSION FROM INCOME FOR 

EMPLOYER-PROVIDED MASS TRANSIT AND PARKING 

BENEFITS. 

(a) IN GENERAL.—Paragraph (2) of section 132(f) is amended 

by striking ‘‘January 1, 2012’’ and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to months after December 31, 2011. 

SEC. 204. EXTENSION OF MORTGAGE INSURANCE PREMIUMS TREATED 

AS QUALIFIED RESIDENCE INTEREST. 

(a) IN GENERAL.—Subclause (I) of section 163(h)(3)(E)(iv) is 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

(b) TECHNICAL AMENDMENTS.—Clause (i) of section 163(h)(4)(E) 

is amended— 

(1) by striking ‘‘Veterans Administration’’ and inserting 

‘‘Department of Veterans Affairs’’, and 

(2) by striking ‘‘Rural Housing Administration’’ and 

inserting ‘‘Rural Housing Service’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to amounts paid or accrued after December 31, 2011. 

SEC. 205. EXTENSION OF DEDUCTION OF STATE AND LOCAL GENERAL 

SALES TAXES. 

(a) IN GENERAL.—Subparagraph (I) of section 164(b)(5) is 

amended by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

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SEC. 206. EXTENSION OF SPECIAL RULE FOR CONTRIBUTIONS OF CAPITAL GAIN REAL PROPERTY MADE FOR CONSERVATION 

PURPOSES. 

(a) IN GENERAL.—Clause (vi) of section 170(b)(1)(E) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) CONTRIBUTIONS BY CERTAIN CORPORATE FARMERS AND

RANCHERS.—Clause (iii) of section 170(b)(2)(B) is amended by 

striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to contributions made in taxable years beginning after 

December 31, 2011. 

SEC. 207. EXTENSION OF ABOVE-THE-LINE DEDUCTION FOR QUALIFIED TUITION AND RELATED EXPENSES. 

(a) IN GENERAL.—Subsection (e) of section 222 is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 208. EXTENSION OF TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL 

RETIREMENT PLANS FOR CHARITABLE PURPOSES. 

(a) IN GENERAL.—Subparagraph (F) of section 408(d)(8) is 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

(b) EFFECTIVE DATE; SPECIAL RULE.— (1) EFFECTIVE DATE.—The amendment made by this section 

shall apply to distributions made in taxable years beginning 

after December 31, 2011. 

(2) SPECIAL RULES.—For purposes of subsections (a)(6), 

(b)(3), and (d)(8) of section 408 of the Internal Revenue Code 

of 1986, at the election of the taxpayer (at such time and 

in such manner as prescribed by the Secretary of the 

Treasury)— 

(A) any qualified charitable distribution made after 

December 31, 2012, and before February 1, 2013, shall 

be deemed to have been made on December 31, 2012, 

and 

(B) any portion of a distribution from an individual 

retirement account to the taxpayer after November 30, 

2012, and before January 1, 2013, may be treated as a 

qualified charitable distribution to the extent that— 

(i) such portion is transferred in cash after the 

distribution to an organization described in section 

408(d)(8)(B)(i) before February 1, 2013, and 

(ii) such portion is part of a distribution that would 

meet the requirements of section 408(d)(8) but for the 

fact that the distribution was not transferred directly 

to an organization described in section 408(d)(8)(B)(i). 

SEC. 209. IMPROVE AND MAKE PERMANENT THE PROVISION AUTHORIZING THE INTERNAL REVENUE SERVICE TO DISCLOSE 

CERTAIN RETURN AND RETURN INFORMATION TO CERTAIN PRISON OFFICIALS. 

(a) IN GENERAL.—Paragraph (10) of section 6103(k) is amended 

to read as follows: 

‘‘(10) DISCLOSURE OF CERTAIN RETURNS AND RETURN

INFORMATION TO CERTAIN PRISON OFFICIALS.— 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 408
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‘‘(A) IN GENERAL.—Under such procedures as the Secretary may prescribe, the Secretary may disclose to officers 

and employees of the Federal Bureau of Prisons and of 

any State agency charged with the responsibility for 

administration of prisons any returns or return information 

with respect to individuals incarcerated in Federal or State 

prison systems whom the Secretary has determined may 

have filed or facilitated the filing of a false or fraudulent 

return to the extent that the Secretary determines that 

such disclosure is necessary to permit effective Federal 

tax administration. 

‘‘(B) DISCLOSURE TO CONTRACTOR-RUN PRISONS.—Under 

such procedures as the Secretary may prescribe, the disclosures authorized by subparagraph (A) may be made to 

contractors responsible for the operation of a Federal or 

State prison on behalf of such Bureau or agency. 

‘‘(C) RESTRICTIONS ON USE OF DISCLOSED INFORMATION.—Any return or return information received under 

this paragraph shall be used only for the purposes of and 

to the extent necessary in taking administrative action 

to prevent the filing of false and fraudulent returns, 

including administrative actions to address possible violations of administrative rules and regulations of the prison 

facility and in administrative and judicial proceedings 

arising from such administrative actions. 

‘‘(D) RESTRICTIONS ON REDISCLOSURE AND DISCLOSURE

TO LEGAL REPRESENTATIVES.—Notwithstanding subsection 

(h)— 

‘‘(i) RESTRICTIONS ON REDISCLOSURE.—Except as 

provided in clause (ii), any officer, employee, or contractor of the Federal Bureau of Prisons or of any 

State agency charged with the responsibility for 

administration of prisons shall not disclose any 

information obtained under this paragraph to any person other than an officer or employee or contractor 

of such Bureau or agency personally and directly 

engaged in the administration of prison facilities on 

behalf of such Bureau or agency. 

‘‘(ii) DISCLOSURE TO LEGAL REPRESENTATIVES.—The 

returns and return information disclosed under this 

paragraph may be disclosed to the duly authorized 

legal representative of the Federal Bureau of Prisons, 

State agency, or contractor charged with the responsibility for administration of prisons, or of the incarcerated individual accused of filing the false or fraudulent 

return who is a party to an action or proceeding 

described in subparagraph (C), solely in preparation 

for, or for use in, such action or proceeding.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) Paragraph (3) of section 6103(a) is amended by inserting 

‘‘subsection (k)(10),’’ after ‘‘subsection (e)(1)(D)(iii),’’. 

(2) Paragraph (4) of section 6103(p) is amended— 

(A) by inserting ‘‘subsection (k)(10),’’ before ‘‘subsection 

(l)(10),’’ in the matter preceding subparagraph (A), 

(B) in subparagraph (F)(i)— 

(i) by inserting ‘‘(k)(10),’’ before ‘‘or (l)(6),’’, and 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 409
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(ii) by inserting ‘‘subsection (k)(10) or’’ before ‘‘subsection (l)(10),’’, and 

(C) by inserting ‘‘subsection (k)(10) or’’ before ‘‘subsection (l)(10),’’ both places it appears in the matter following subparagraph (F)(iii). 

(3) Paragraph (2) of section 7213(a) is amended by inserting 

‘‘(k)(10),’’ before ‘‘(l)(6),’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect on the date of the enactment of this Act. 

TITLE III—BUSINESS TAX EXTENDERS 

SEC. 301. EXTENSION AND MODIFICATION OF RESEARCH CREDIT. 

(a) EXTENSION.— 

(1) IN GENERAL.—Subparagraph (B) of section 41(h)(1) is 

amended by striking ‘‘December 31, 2011’’ and inserting 

‘‘December 31, 2013’’. 

(2) CONFORMING AMENDMENT.—Subparagraph (D) of section 45C(b)(1) is amended by striking ‘‘December 31, 2011’’ 

and inserting ‘‘December 31, 2013’’. 

(b) INCLUSION OF QUALIFIED RESEARCH EXPENSES AND GROSS

RECEIPTS OF AN ACQUIRED PERSON.— (1) PARTIAL INCLUSION OF PRE-ACQUISITION QUALIFIED

RESEARCH EXPENSES AND GROSS RECEIPTS.—Subparagraph (A) 

of section 41(f)(3) is amended to read as follows: 

‘‘(A) ACQUISITIONS.— ‘‘(i) IN GENERAL.—If a person acquires the major 

portion of either a trade or business or a separate 

unit of a trade or business (hereinafter in this paragraph referred to as the ‘acquired business’) of another 

person (hereinafter in this paragraph referred to as 

the ‘predecessor’), then the amount of qualified 

research expenses paid or incurred by the acquiring 

person during the measurement period shall be 

increased by the amount determined under clause (ii), 

and the gross receipts of the acquiring person for such 

period shall be increased by the amount determined 

under clause (iii). 

‘‘(ii) AMOUNT DETERMINED WITH RESPECT TO QUALIFIED RESEARCH EXPENSES.—The amount determined 

under this clause is— 

‘‘(I) for purposes of applying this section for 

the taxable year in which such acquisition is made, 

the acquisition year amount, and 

‘‘(II) for purposes of applying this section for 

any taxable year after the taxable year in which 

such acquisition is made, the qualified research 

expenses paid or incurred by the predecessor with 

respect to the acquired business during the 

measurement period. 

‘‘(iii) AMOUNT DETERMINED WITH RESPECT TO GROSS

RECEIPTS.—The amount determined under this clause 

is the amount which would be determined under clause 

(ii) if ‘the gross receipts of’ were substituted for ‘the 

qualified research expenses paid or incurred by’ each 

place it appears in clauses (ii) and (iv). 

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‘‘(iv) ACQUISITION YEAR AMOUNT.—For purposes of 

clause (ii), the acquisition year amount is the amount 

equal to the product of— 

‘‘(I) the qualified research expenses paid or 

incurred by the predecessor with respect to the 

acquired business during the measurement period, 

and 

‘‘(II) the number of days in the period beginning on the date of the acquisition and ending 

on the last day of the taxable year in which the 

acquisition is made, 

divided by the number of days in the acquiring person’s 

taxable year. 

‘‘(v) SPECIAL RULES FOR COORDINATING TAXABLE

YEARS.—In the case of an acquiring person and a predecessor whose taxable years do not begin on the same 

date— 

‘‘(I) each reference to a taxable year in clauses 

(ii) and (iv) shall refer to the appropriate taxable 

year of the acquiring person, 

‘‘(II) the qualified research expenses paid or 

incurred by the predecessor, and the gross receipts 

of the predecessor, during each taxable year of 

the predecessor any portion of which is part of 

the measurement period shall be allocated equally 

among the days of such taxable year, 

‘‘(III) the amount of such qualified research 

expenses taken into account under clauses (ii) and 

(iv) with respect to a taxable year of the acquiring 

person shall be equal to the total of the expenses 

attributable under subclause (II) to the days occurring during such taxable year, and 

‘‘(IV) the amount of such gross receipts taken 

into account under clause (iii) with respect to a 

taxable year of the acquiring person shall be equal 

to the total of the gross receipts attributable under 

subclause (II) to the days occurring during such 

taxable year. 

‘‘(vi) MEASUREMENT PERIOD.—For purposes of this 

subparagraph, the term ‘measurement period’ means, 

with respect to the taxable year of the acquiring person 

for which the credit is determined, any period of the 

acquiring person preceding such taxable year which 

is taken into account for purposes of determining the 

credit for such year.’’. 

(2) EXPENSES AND GROSS RECEIPTS OF A PREDECESSOR.— 

Subparagraph (B) of section 41(f)(3) is amended to read as 

follows: 

‘‘(B) DISPOSITIONS.—If the predecessor furnished to the 

acquiring person such information as is necessary for the 

application of subparagraph (A), then, for purposes of 

applying this section for any taxable year ending after 

such disposition, the amount of qualified research expenses 

paid or incurred by, and the gross receipts of, the predecessor during the measurement period (as defined in 

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H. R. 8—16 

subparagraph (A)(vi), determined by substituting ‘predecessor’ for ‘acquiring person’ each place it appears) shall 

be reduced by— 

‘‘(i) in the case of the taxable year in which such 

disposition is made, an amount equal to the product 

of— 

‘‘(I) the qualified research expenses paid or 

incurred by, or gross receipts of, the predecessor 

with respect to the acquired business during the 

measurement period (as so defined and so determined), and 

‘‘(II) the number of days in the period beginning on the date of acquisition (as determined 

for purposes of subparagraph (A)(iv)(II)) and 

ending on the last day of the taxable year of the 

predecessor in which the disposition is made, 

divided by the number of days in the taxable year 

of the predecessor, and 

‘‘(ii) in the case of any taxable year ending after 

the taxable year in which such disposition is made, 

the amount described in clause (i)(I).’’. 

(c) AGGREGATION OF EXPENDITURES.—Paragraph (1) of section 

41(f) is amended— 

(1) by striking ‘‘shall be its proportionate shares of the 

qualified research expenses, basic research payments, and 

amounts paid or incurred to energy research consortiums, 

giving rise to the credit’’ in subparagraph (A)(ii) and inserting 

‘‘shall be determined on a proportionate basis to its share 

of the aggregate of the qualified research expenses, basic 

research payments, and amounts paid or incurred to energy 

research consortiums, taken into account by such controlled 

group for purposes of this section’’, and 

(2) by striking ‘‘shall be its proportionate shares of the 

qualified research expenses, basic research payments, and 

amounts paid or incurred to energy research consortiums, 

giving rise to the credit’’ in subparagraph (B)(ii) and inserting 

‘‘shall be determined on a proportionate basis to its share 

of the aggregate of the qualified research expenses, basic 

research payments, and amounts paid or incurred to energy 

research consortiums, taken into account by all such persons 

under common control for purposes of this section’’. 

(d) EFFECTIVE DATE.— 

(1) EXTENSION.—The amendments made by subsection (a) 

shall apply to amounts paid or incurred after December 31, 

2011. 

(2) MODIFICATIONS.—The amendments made by subsections 

(b) and (c) shall apply to taxable years beginning after 

December 31, 2011. 

SEC. 302. EXTENSION OF TEMPORARY MINIMUM LOW-INCOME TAX 

CREDIT RATE FOR NON-FEDERALLY SUBSIDIZED NEW 

BUILDINGS. 

(a) IN GENERAL.—Subparagraph (A) of section 42(b)(2) is 

amended by striking ‘‘and before December 31, 2013’’ and inserting 

‘‘with respect to housing credit dollar amount allocations made 

before January 1, 2014’’. 

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(b) EFFECTIVE DATE.—The amendment made by this section 

shall take effect on the date of the enactment of this Act. 

SEC. 303. EXTENSION OF HOUSING ALLOWANCE EXCLUSION FOR 

DETERMINING AREA MEDIAN GROSS INCOME FOR QUALIFIED RESIDENTIAL RENTAL PROJECT EXEMPT FACILITY 

BONDS. 

(a) IN GENERAL.—Subsection (b) of section 3005 of the Housing 

Assistance Tax Act of 2008 is amended by striking ‘‘January 1, 

2012’’ each place it appears and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall take effect as if included in the enactment of section 3005 

of the Housing Assistance Tax Act of 2008. 

SEC. 304. EXTENSION OF INDIAN EMPLOYMENT TAX CREDIT. 

(a) IN GENERAL.—Subsection (f) of section 45A is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 305. EXTENSION OF NEW MARKETS TAX CREDIT. 

(a) IN GENERAL.—Subparagraph (G) of section 45D(f)(1) is 

amended by striking ‘‘2010 and 2011’’ and inserting ‘‘2010, 2011, 

2012, and 2013’’. 

(b) CARRYOVER OF UNUSED LIMITATION.—Paragraph (3) of section 45D(f) is amended by striking ‘‘2016’’ and inserting ‘‘2018’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to calendar years beginning after December 31, 2011. 

SEC. 306. EXTENSION OF RAILROAD TRACK MAINTENANCE CREDIT. 

(a) IN GENERAL.—Subsection (f) of section 45G is amended 

by striking ‘‘January 1, 2012’’ and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to expenditures paid or incurred in taxable years beginning after December 31, 2011. 

SEC. 307. EXTENSION OF MINE RESCUE TEAM TRAINING CREDIT. 

(a) IN GENERAL.—Subsection (e) of section 45N is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 308. EXTENSION OF EMPLOYER WAGE CREDIT FOR EMPLOYEES 

WHO ARE ACTIVE DUTY MEMBERS OF THE UNIFORMED 

SERVICES. 

(a) IN GENERAL.—Subsection (f) of section 45P is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to payments made after December 31, 2011. 

SEC. 309. EXTENSION OF WORK OPPORTUNITY TAX CREDIT. 

(a) IN GENERAL.—Subparagraph (B) of section 51(c)(4) is 

amended by striking ‘‘after’’ and all that follows and inserting 

‘‘after December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to individuals who begin work for the employer after 

December 31, 2011. 

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H. R. 8—18 

SEC. 310. EXTENSION OF QUALIFIED ZONE ACADEMY BONDS. 

(a) IN GENERAL.—Paragraph (1) of section 54E(c) is amended 

by inserting ‘‘, 2012, and 2013’’ after ‘‘for 2011’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to obligations issued after December 31, 2011. 

SEC. 311. EXTENSION OF 15-YEAR STRAIGHT-LINE COST RECOVERY 

FOR QUALIFIED LEASEHOLD IMPROVEMENTS, QUALIFIED 

RESTAURANT BUILDINGS AND IMPROVEMENTS, AND 

QUALIFIED RETAIL IMPROVEMENTS. 

(a) IN GENERAL.—Clauses (iv), (v), and (ix) of section 

168(e)(3)(E) are each amended by striking ‘‘January 1, 2012’’ and 

inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 312. EXTENSION OF 7-YEAR RECOVERY PERIOD FOR MOTORSPORTS ENTERTAINMENT COMPLEXES. 

(a) IN GENERAL.—Subparagraph (D) of section 168(i)(15) is 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 313. EXTENSION OF ACCELERATED DEPRECIATION FOR BUSINESS 

PROPERTY ON AN INDIAN RESERVATION. 

(a) IN GENERAL.—Paragraph (8) of section 168(j) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 314. EXTENSION OF ENHANCED CHARITABLE DEDUCTION FOR 

CONTRIBUTIONS OF FOOD INVENTORY. 

(a) IN GENERAL.—Clause (iv) of section 170(e)(3)(C) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to contributions made after December 31, 2011. 

SEC. 315. EXTENSION OF INCREASED EXPENSING LIMITATIONS AND 

TREATMENT OF CERTAIN REAL PROPERTY AS SECTION 

179 PROPERTY. 

(a) IN GENERAL.— 

(1) DOLLAR LIMITATION.—Section 179(b)(1) is amended— 

(A) by striking ‘‘2010 or 2011,’’ in subparagraph (B) 

and inserting ‘‘2010, 2011, 2012, or 2013, and’’, 

(B) by striking subparagraph (C), 

(C) by redesignating subparagraph (D) as subparagraph (C), and 

(D) in subparagraph (C), as so redesignated, by striking 

‘‘2012’’ and inserting ‘‘2013’’. 

(2) REDUCTION IN LIMITATION.—Section 179(b)(2) is 

amended— 

(A) by striking ‘‘2010 or 2011,’’ in subparagraph (B) 

and inserting ‘‘2010, 2011, 2012, or 2013, and’’, 

(B) by striking subparagraph (C), 

(C) by redesignating subparagraph (D) as subparagraph (C), and 

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H. R. 8—19 

(D) in subparagraph (C), as so redesignated, by striking 

‘‘2012’’ and inserting ‘‘2013’’. 

(3) CONFORMING AMENDMENT.—Subsection (b) of section 

179 is amended by striking paragraph (6). 

(b) COMPUTER SOFTWARE.—Section 179(d)(1)(A)(ii) is amended 

by striking ‘‘2013’’ and inserting ‘‘2014’’. 

(c) ELECTION.—Section 179(c)(2) is amended by striking ‘‘2013’’ 

and inserting ‘‘2014’’. 

(d) SPECIAL RULES FOR TREATMENT OF QUALIFIED REAL PROP- ERTY.— (1) IN GENERAL.—Section 179(f)(1) is amended by striking 

‘‘2010 or 2011’’ and inserting ‘‘2010, 2011, 2012, or 2013’’. 

(2) CARRYOVER LIMITATION.— 

(A) IN GENERAL.—Section 179(f)(4) is amended by 

striking ‘‘2011’’ each place it appears and inserting ‘‘2013’’. 

(B) CONFORMING AMENDMENT.—Subparagraph (C) of 

section 179(f)(4) is amended— 

(i) in the heading, by striking ‘‘2010’’ and inserting 

‘‘2010, 2011 AND 2012’’, and 

(ii) by adding at the end the following: ‘‘For the 

last taxable year beginning in 2013, the amount determined under subsection (b)(3)(A) for such taxable year 

shall be determined without regard to this paragraph.’’. 

(e) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 316. EXTENSION OF ELECTION TO EXPENSE MINE SAFETY EQUIPMENT. 

(a) IN GENERAL.—Subsection (g) of section 179E is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 317. EXTENSION OF SPECIAL EXPENSING RULES FOR CERTAIN 

FILM AND TELEVISION PRODUCTIONS. 

(a) IN GENERAL.—Subsection (f) of section 181 is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to productions commencing after December 31, 2011. 

SEC. 318. EXTENSION OF DEDUCTION ALLOWABLE WITH RESPECT TO 

INCOME ATTRIBUTABLE TO DOMESTIC PRODUCTION 

ACTIVITIES IN PUERTO RICO. 

(a) IN GENERAL.—Subparagraph (C) of section 199(d)(8) is 

amended— 

(1) by striking ‘‘first 6 taxable years’’ and inserting ‘‘first 

8 taxable years’’, and 

(2) by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 319. EXTENSION OF MODIFICATION OF TAX TREATMENT OF CERTAIN PAYMENTS TO CONTROLLING EXEMPT ORGANIZATIONS. 

(a) IN GENERAL.—Clause (iv) of section 512(b)(13)(E) is 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

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(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to payments received or accrued after December 31, 

2011. 

SEC. 320. EXTENSION OF TREATMENT OF CERTAIN DIVIDENDS OF 

REGULATED INVESTMENT COMPANIES. 

(a) IN GENERAL.—Paragraphs (1)(C)(v) and (2)(C)(v) of section 

871(k) are each amended by striking ‘‘December 31, 2011’’ and 

inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 321. EXTENSION OF RIC QUALIFIED INVESTMENT ENTITY TREATMENT UNDER FIRPTA. 

(a) IN GENERAL.—Clause (ii) of section 897(h)(4)(A) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.— 

(1) IN GENERAL.—The amendment made by subsection (a) 

shall take effect on January 1, 2012. Notwithstanding the preceding sentence, such amendment shall not apply with respect 

to the withholding requirement under section 1445 of the 

Internal Revenue Code of 1986 for any payment made before 

the date of the enactment of this Act. 

(2) AMOUNTS WITHHELD ON OR BEFORE DATE OF ENACTMENT.—In the case of a regulated investment company— 

(A) which makes a distribution after December 31, 

2011, and before the date of the enactment of this Act; 

and 

(B) which would (but for the second sentence of paragraph (1)) have been required to withhold with respect 

to such distribution under section 1445 of such Code, 

such investment company shall not be liable to any person 

to whom such distribution was made for any amount so withheld and paid over to the Secretary of the Treasury. 

SEC. 322. EXTENSION OF SUBPART F EXCEPTION FOR ACTIVE 

FINANCING INCOME. 

(a) EXEMPT INSURANCE INCOME.—Paragraph (10) of section 

953(e) is amended— 

(1) by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’, and 

(2) by striking ‘‘December 31, 2011’’ and inserting 

‘‘December 31, 2013’’. 

(b) SPECIAL RULE FOR INCOME DERIVED IN THE ACTIVE CONDUCT

OF BANKING, FINANCING, OR SIMILAR BUSINESSES.—Paragraph (9) 

of section 954(h) is amended by striking ‘‘January 1, 2012’’ and 

inserting ‘‘January 1, 2014’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years of foreign corporations beginning after 

December 31, 2011, and to taxable years of United States shareholders with or within which any such taxable year of such foreign 

corporation ends. 

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SEC. 323. EXTENSION OF LOOK-THRU TREATMENT OF PAYMENTS 

BETWEEN RELATED CONTROLLED FOREIGN CORPORATIONS UNDER FOREIGN PERSONAL HOLDING COMPANY 

RULES. 

(a) IN GENERAL.—Subparagraph (C) of section 954(c)(6) is 

amended by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years of foreign corporations beginning after 

December 31, 2011, and to taxable years of United States shareholders with or within which such taxable years of foreign corporations end. 

SEC. 324. EXTENSION OF TEMPORARY EXCLUSION OF 100 PERCENT 

OF GAIN ON CERTAIN SMALL BUSINESS STOCK. 

(a) IN GENERAL.—Paragraph (4) of section 1202(a) is amended— 

(1) by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’, and 

(2) by striking ‘‘AND 2011’’ and inserting ‘‘, 2011, 2012, 

AND 2013’’ in the heading thereof. 

(b) TECHNICAL AMENDMENTS.— 

(1) SPECIAL RULE FOR 2009 AND CERTAIN PERIOD IN 2010.— 

Paragraph (3) of section 1202(a) is amended by adding at the 

end the following new flush sentence: 

‘‘In the case of any stock which would be described in the 

preceding sentence (but for this sentence), the acquisition date 

for purposes of this subsection shall be the first day on which 

such stock was held by the taxpayer determined after the 

application of section 1223.’’. 

(2) 100 PERCENT EXCLUSION.—Paragraph (4) of section 

1202(a) is amended by adding at the end the following new 

flush sentence: 

‘‘In the case of any stock which would be described in the 

preceding sentence (but for this sentence), the acquisition date 

for purposes of this subsection shall be the first day on which 

such stock was held by the taxpayer determined after the 

application of section 1223.’’. 

(c) EFFECTIVE DATES.— 

(1) IN GENERAL.—The amendments made by subsection 

(a) shall apply to stock acquired after December 31, 2011. 

(2) SUBSECTION (b)(1).—The amendment made by subsection (b)(1) shall take effect as if included in section 1241(a) 

of division B of the American Recovery and Reinvestment Act 

of 2009. 

(3) SUBSECTION (b)(2).—The amendment made by subsection (b)(2) shall take effect as if included in section 2011(a) 

of the Creating Small Business Jobs Act of 2010. 

SEC. 325. EXTENSION OF BASIS ADJUSTMENT TO STOCK OF S CORPORATIONS MAKING CHARITABLE CONTRIBUTIONS OF 

PROPERTY. 

(a) IN GENERAL.—Paragraph (2) of section 1367(a) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to contributions made in taxable years beginning after 

December 31, 2011. 

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SEC. 326. EXTENSION OF REDUCTION IN S-CORPORATION RECOGNITION PERIOD FOR BUILT-IN GAINS TAX. 

(a) IN GENERAL.—Paragraph (7) of section 1374(d) is amended— 

(1) by redesignating subparagraph (C) as subparagraph 

(D), and 

(2) by inserting after subparagraph (B) the following new 

subparagraph: 

‘‘(C) SPECIAL RULE FOR 2012 AND 2013.—For purposes 

of determining the net recognized built-in gain for taxable 

years beginning in 2012 or 2013, subparagraphs (A) and 

(D) shall be applied by substituting ‘5-year’ for ‘10-year’.’’, 

and 

(3) by adding at the end the following new subparagraph: 

‘‘(E) INSTALLMENT SALES.—If an S corporation sells 

an asset and reports the income from the sale using the 

installment method under section 453, the treatment of 

all payments received shall be governed by the provisions 

of this paragraph applicable to the taxable year in which 

such sale was made.’’. 

(b) TECHNICAL AMENDMENT.—Subparagraph (B) of section 

1374(d)(2) is amended by inserting ‘‘described in subparagraph (A)’’ 

after ‘‘, for any taxable year’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 327. EXTENSION OF EMPOWERMENT ZONE TAX INCENTIVES. 

(a) IN GENERAL.—Clause (i) of section 1391(d)(1)(A) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) INCREASED EXCLUSION OF GAIN ON STOCK OF EMPOWERMENT

ZONE BUSINESSES.—Subparagraph (C) of section 1202(a)(2) is 

amended— 

(1) by striking ‘‘December 31, 2016’’ and inserting 

‘‘December 31, 2018’’; and 

(2) by striking ‘‘2016’’ in the heading and inserting ‘‘2018’’. 

(c) TREATMENT OF CERTAIN TERMINATION DATES SPECIFIED IN

NOMINATIONS.—In the case of a designation of an empowerment 

zone the nomination for which included a termination date which 

is contemporaneous with the date specified in subparagraph (A)(i) 

of section 1391(d)(1) of the Internal Revenue Code of 1986 (as 

in effect before the enactment of this Act), subparagraph (B) of 

such section shall not apply with respect to such designation if, 

after the date of the enactment of this section, the entity which 

made such nomination amends the nomination to provide for a 

new termination date in such manner as the Secretary of the 

Treasury (or the Secretary’s designee) may provide. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to periods after December 31, 2011. 

SEC. 328. EXTENSION OF TAX-EXEMPT FINANCING FOR NEW YORK LIBERTY ZONE. 

(a) IN GENERAL.—Subparagraph (D) of section 1400L(d)(2) is 

amended by striking ‘‘January 1, 2012’’ and inserting ‘‘January 

1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to bonds issued after December 31, 2011. 

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SEC. 329. EXTENSION OF TEMPORARY INCREASE IN LIMIT ON COVER 

OVER OF RUM EXCISE TAXES TO PUERTO RICO AND THE 

VIRGIN ISLANDS. 

(a) IN GENERAL.—Paragraph (1) of section 7652(f) is amended 

by striking ‘‘January 1, 2012’’ and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to distilled spirits brought into the United States after 

December 31, 2011. 

SEC. 330. MODIFICATION AND EXTENSION OF AMERICAN SAMOA ECONOMIC DEVELOPMENT CREDIT. 

(a) MODIFICATION.— 

(1) IN GENERAL.—Subsection (a) of section 119 of division 

A of the Tax Relief and Health Care Act of 2006 is amended 

by striking ‘‘if such corporation’’ and all that follows and 

inserting ‘‘if— 

‘‘(1) in the case of a taxable year beginning before January 

1, 2012, such corporation— 

‘‘(A) is an existing credit claimant with respect to American Samoa, and 

‘‘(B) elected the application of section 936 of the 

Internal Revenue Code of 1986 for its last taxable year 

beginning before January 1, 2006, and 

‘‘(2) in the case of a taxable year beginning after December 

31, 2011, such corporation meets the requirements of subsection 

(e).’’. 

(2) REQUIREMENTS.—Section 119 of division A of such Act 

is amended by adding at the end the following new subsection: 

‘‘(e) QUALIFIED PRODUCTION ACTIVITIES INCOME REQUIREMENT.—A corporation meets the requirement of this subsection 

if such corporation has qualified production activities income, as 

defined in subsection (c) of section 199 of the Internal Revenue 

Code of 1986, determined by substituting ‘American Samoa’ for 

‘the United States’ each place it appears in paragraphs (3), (4), 

and (6) of such subsection (c), for the taxable year.’’. 

(b) EXTENSION.—Subsection (d) of section 119 of division A 

of the Tax Relief and Health Care Act of 2006 is amended by 

striking ‘‘shall apply’’ and all that follows and inserting ‘‘shall 

apply— 

‘‘(1) in the case of a corporation that meets the requirements of subparagraphs (A) and (B) of subsection (a)(1), to 

the first 8 taxable years of such corporation which begin after 

December 31, 2006, and before January 1, 2014, and 

‘‘(2) in the case of a corporation that does not meet the 

requirements of subparagraphs (A) and (B) of subsection (a)(1), 

to the first 2 taxable years of such corporation which begin 

after December 31, 2011, and before January 1, 2014.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2011. 

SEC. 331. EXTENSION AND MODIFICATION OF BONUS DEPRECIATION. 

(a) IN GENERAL.—Paragraph (2) of section 168(k) is amended— 

(1) by striking ‘‘January 1, 2014’’ in subparagraph (A)(iv) 

and inserting ‘‘January 1, 2015’’, and 

(2) by striking ‘‘January 1, 2013’’ each place it appears 

and inserting ‘‘January 1, 2014’’. 

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(b) SPECIAL RULE FOR FEDERAL LONG-TERM CONTRACTS.— 

Clause (ii) of section 460(c)(6)(B) is amended by inserting ‘‘, or 

after December 31, 2012, and before January 1, 2014 (January 

1, 2015, in the case of property described in section 168(k)(2)(B))’’ 

before the period. 

(c) EXTENSION OF ELECTION TO ACCELERATE THE AMT CREDIT

IN LIEU OF BONUS DEPRECIATION.— 

(1) IN GENERAL.—Subclause (II) of section 168(k)(4)(D)(iii) 

is amended by striking ‘‘2013’’ and inserting ‘‘2014’’. 

(2) ROUND 3 EXTENSION PROPERTY.—Paragraph (4) of section 168(k) is amended by adding at the end the following 

new subparagraph: 

‘‘(J) SPECIAL RULES FOR ROUND 3 EXTENSION PROPERTY.— 

‘‘(i) IN GENERAL.—In the case of round 3 extension 

property, this paragraph shall be applied without 

regard to— 

‘‘(I) the limitation described in subparagraph 

(B)(i) thereof, and 

‘‘(II) the business credit increase amount 

under subparagraph (E)(iii) thereof. 

‘‘(ii) TAXPAYERS PREVIOUSLY ELECTING ACCELERATION.—In the case of a taxpayer who made the election 

under subparagraph (A) for its first taxable year ending 

after March 31, 2008, a taxpayer who made the election 

under subparagraph (H)(ii) for its first taxable year 

ending after December 31, 2008, or a taxpayer who 

made the election under subparagraph (I)(iii) for its 

first taxable year ending after December 31, 2010— 

‘‘(I) the taxpayer may elect not to have this 

paragraph apply to round 3 extension property, 

but 

‘‘(II) if the taxpayer does not make the election 

under subclause (I), in applying this paragraph 

to the taxpayer the bonus depreciation amount, 

maximum amount, and maximum increase amount 

shall be computed and applied to eligible qualified 

property which is round 3 extension property. 

The amounts described in subclause (II) shall be computed separately from any amounts computed with 

respect to eligible qualified property which is not round 

3 extension property. 

‘‘(iii) TAXPAYERS NOT PREVIOUSLY ELECTING ACCELERATION.—In the case of a taxpayer who neither made 

the election under subparagraph (A) for its first taxable 

year ending after March 31, 2008, nor made the election under subparagraph (H)(ii) for its first taxable 

year ending after December 31, 2008, nor made the 

election under subparagraph (I)(iii) for any taxable 

year ending after December 31, 2010— 

‘‘(I) the taxpayer may elect to have this paragraph apply to its first taxable year ending after 

December 31, 2012, and each subsequent taxable 

year, and 

‘‘(II) if the taxpayer makes the election under 

subclause (I), this paragraph shall only apply to 

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eligible qualified property which is round 3 extension property. 

‘‘(iv) ROUND 3 EXTENSION PROPERTY.—For purposes 

of this subparagraph, the term ‘round 3 extension property’ means property which is eligible qualified property solely by reason of the extension of the application 

of the special allowance under paragraph (1) pursuant 

to the amendments made by section 331(a) of the American Taxpayer Relief Act of 2012 (and the application 

of such extension to this paragraph pursuant to the 

amendment made by section 331(c)(1) of such Act).’’. 

(d) NORMALIZATION RULES AMENDMENT.—Clause (ii) of section 

168(i)(9)(A) is amended by inserting ‘‘(respecting all elections made 

by the taxpayer under this section)’’ after ‘‘such property’’. 

(e) CONFORMING AMENDMENTS.— (1) The heading for subsection (k) of section 168 is amended 

by striking ‘‘JANUARY 1, 2013’’ and inserting ‘‘JANUARY 1, 2014’’. 

(2) The heading for clause (ii) of section 168(k)(2)(B) is 

amended by striking ‘‘PRE-JANUARY 1, 2013’’ and inserting ‘‘PRE- JANUARY 1, 2014’’. 

(3) Subparagraph (C) of section 168(n)(2) is amended by 

striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’. 

(4) Subparagraph (D) of section 1400L(b)(2) is amended 

by striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’. 

(5) Subparagraph (B) of section 1400N(d)(3) is amended 

by striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’. 

(f) EFFECTIVE DATE.—The amendments made by this section 

shall apply to property placed in service after December 31, 2012, 

in taxable years ending after such date. 

TITLE IV—ENERGY TAX EXTENDERS 

SEC. 401. EXTENSION OF CREDIT FOR ENERGY-EFFICIENT EXISTING 

HOMES. 

(a) IN GENERAL.—Paragraph (2) of section 25C(g) is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 402. EXTENSION OF CREDIT FOR ALTERNATIVE FUEL VEHICLE 

REFUELING PROPERTY. 

(a) IN GENERAL.—Paragraph (2) of section 30C(g) is amended 

by striking ‘‘December 31, 2011.’’ and inserting ‘‘December 31, 2013’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2011. 

SEC. 403. EXTENSION OF CREDIT FOR 2- OR 3-WHEELED PLUG-IN ELECTRIC VEHICLES. 

(a) IN GENERAL.—Section 30D is amended by adding at the 

end the following new subsection: 

‘‘(g) CREDIT ALLOWED FOR 2- AND 3-WHEELED PLUG-IN ELECTRIC

VEHICLES.— 

‘‘(1) IN GENERAL.—In the case of a qualified 2- or 3-wheeled 

plug-in electric vehicle— 

‘‘(A) there shall be allowed as a credit against the 

tax imposed by this chapter for the taxable year an amount 

equal to the sum of the applicable amount with respect 

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to each such qualified 2- or 3-wheeled plug-in electric 

vehicle placed in service by the taxpayer during the taxable 

year, and 

‘‘(B) the amount of the credit allowed under subparagraph (A) shall be treated as a credit allowed under subsection (a). 

‘‘(2) APPLICABLE AMOUNT.—For purposes of paragraph (1), 

the applicable amount is an amount equal to the lesser of— 

‘‘(A) 10 percent of the cost of the qualified 2- or 3- 

wheeled plug-in electric vehicle, or 

‘‘(B) $2,500. 

‘‘(3) QUALIFIED 2- OR 3-WHEELED PLUG-IN ELECTRIC

VEHICLE.—The term ‘qualified 2- or 3-wheeled plug-in electric 

vehicle’ means any vehicle which— 

‘‘(A) has 2 or 3 wheels, 

‘‘(B) meets the requirements of subparagraphs (A), (B), 

(C), (E), and (F) of subsection (d)(1) (determined by substituting ‘2.5 kilowatt hours’ for ‘4 kilowatt hours’ in 

subparagraph (F)(i)), 

‘‘(C) is manufactured primarily for use on public 

streets, roads, and highways, 

‘‘(D) is capable of achieving a speed of 45 miles per 

hour or greater, and 

‘‘(E) is acquired after December 31, 2011, and before 

January 1, 2014.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) NO DOUBLE BENEFIT.—Paragraph (2) of section 30D(f) 

is amended— 

(A) by striking ‘‘new qualified plug-in electric drive 

motor vehicle’’ and inserting ‘‘vehicle for which a credit 

is allowable under subsection (a)’’, and 

(B) by striking ‘‘allowed under subsection (a)’’ and 

inserting ‘‘allowed under such subsection’’. 

(2) AIR QUALITY AND SAFETY STANDARDS.—Section 30D(f)(7) 

is amended by striking ‘‘motor vehicle’’ and inserting ‘‘vehicle’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to vehicles acquired after December 31, 2011. 

SEC. 404. EXTENSION AND MODIFICATION OF CELLULOSIC BIOFUEL 

PRODUCER CREDIT. 

(a) EXTENSION.— 

(1) IN GENERAL.—Subparagraph (H) of section 40(b)(6) is 

amended to read as follows: 

‘‘(H) APPLICATION OF PARAGRAPH.— 

‘‘(i) IN GENERAL.—This paragraph shall apply with 

respect to qualified cellulosic biofuel production after 

December 31, 2008, and before January 1, 2014. 

‘‘(ii) NO CARRYOVER TO CERTAIN YEARS AFTER

EXPIRATION.—If this paragraph ceases to apply for any 

period by reason of clause (i), rules similar to the 

rules of subsection (e)(2) shall apply.’’. 

(2) CONFORMING AMENDMENT.—Paragraph (2) of section 

40(e) is amended by striking ‘‘or subsection (b)(6)(H)’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall take effect as if included in section 15321(b) of 

the Heartland, Habitat, and Horticulture Act of 2008. 

(b) ALGAE TREATED AS A QUALIFIED FEEDSTOCK.— 

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H. R. 8—27 

(1) IN GENERAL.—Subclause (I) of section 40(b)(6)(E)(i) is 

amended to read as follows: 

‘‘(I) is derived by, or from, qualified feedstocks, 

and’’. 

(2) QUALIFIED FEEDSTOCK; SPECIAL RULES FOR ALGAE.— 

Paragraph (6) of section 40(b) is amended by redesignating 

subparagraphs (F), (G), and (H), as amended by this Act, as 

subparagraphs (H), (I), and (J), respectively, and by inserting 

after subparagraph (E) the following new subparagraphs: 

‘‘(F) QUALIFIED FEEDSTOCK.—For purposes of this paragraph, the term ‘qualified feedstock’ means— 

‘‘(i) any lignocellulosic or hemicellulosic matter 

that is available on a renewable or recurring basis, 

and 

‘‘(ii) any cultivated algae, cyanobacteria, or lemna. 

‘‘(G) SPECIAL RULES FOR ALGAE.—In the case of fuel 

which is derived by, or from, feedstock described in 

subparagraph (F)(ii) and which is sold by the taxpayer 

to another person for refining by such other person into 

a fuel which meets the requirements of subparagraph 

(E)(i)(II) and the refined fuel is not excluded under subparagraph (E)(iii)— 

‘‘(i) such sale shall be treated as described in 

subparagraph (C)(i), 

‘‘(ii) such fuel shall be treated as meeting the 

requirements of subparagraph (E)(i)(II) and as not 

being excluded under subparagraph (E)(iii) in the 

hands of such taxpayer, and 

‘‘(iii) except as provided in this subparagraph, such 

fuel (and any fuel derived from such fuel) shall not 

be taken into account under subparagraph (C) with 

respect to the taxpayer or any other person.’’. 

(3) CONFORMING AMENDMENTS.— 

(A) Section 40, as amended by paragraph (2), is 

amended— 

(i) by striking ‘‘cellulosic biofuel’’ each place it 

appears in the text thereof and inserting ‘‘second 

generation biofuel’’, 

(ii) by striking ‘‘CELLULOSIC’’ in the headings of 

subsections (b)(6), (b)(6)(E), and (d)(3)(D) and inserting 

‘‘SECOND GENERATION’’, and 

(iii) by striking ‘‘CELLULOSIC’’ in the headings of 

subsections (b)(6)(C), (b)(6)(D), (b)(6)(H), (d)(6), and 

(e)(3) and inserting ‘‘SECOND GENERATION’’. 

(B) Clause (ii) of section 40(b)(6)(E) is amended by 

striking ‘‘Such term shall not’’ and inserting ‘‘The term 

‘second generation biofuel’ shall not’’. 

(C) Paragraph (1) of section 4101(a) is amended by 

striking ‘‘cellulosic biofuel’’ and inserting ‘‘second generation biofuel’’. 

(4) EFFECTIVE DATE.—The amendments made by this subsection shall apply to fuels sold or used after the date of 

the enactment of this Act. 

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SEC. 405. EXTENSION OF INCENTIVES FOR BIODIESEL AND RENEWABLE DIESEL. 

(a) CREDITS FOR BIODIESEL AND RENEWABLE DIESEL USED AS

FUEL.—Subsection (g) of section 40A is amended by striking 

‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) EXCISE TAX CREDITS AND OUTLAY PAYMENTS FOR BIODIESEL

AND RENEWABLE DIESEL FUEL MIXTURES.— 

(1) Paragraph (6) of section 6426(c) is amended by striking 

‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(2) Subparagraph (B) of section 6427(e)(6) is amended by 

striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 

2013’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to fuel sold or used after December 31, 2011. 

SEC. 406. EXTENSION OF PRODUCTION CREDIT FOR INDIAN COAL 

FACILITIES PLACED IN SERVICE BEFORE 2009. 

(a) IN GENERAL.—Subparagraph (A) of section 45(e)(10) is 

amended by striking ‘‘7-year period’’ each place it appears and 

inserting ‘‘8-year period’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to coal produced after December 31, 2012. 

SEC. 407. EXTENSION AND MODIFICATION OF CREDITS WITH RESPECT 

TO FACILITIES PRODUCING ENERGY FROM CERTAIN 

RENEWABLE RESOURCES. 

(a) PRODUCTION TAX CREDIT.— 

(1) EXTENSION FOR WIND FACILITIES.—Paragraph (1) of section 45(d) is amended by striking ‘‘January 1, 2013’’ and 

inserting ‘‘January 1, 2014’’. 

(2) EXCLUSION OF PAPER WHICH IS COMMONLY RECYCLED

FROM DEFINITION OF MUNICIPAL SOLID WASTE.—Section 45(c)(6) 

is amended by inserting ‘‘, except that such term does not 

include paper which is commonly recycled and which has been 

segregated from other solid waste (as so defined)’’ after ‘‘(42 

U.S.C. 6903)’’. 

(3) MODIFICATION TO DEFINITION OF QUALIFIED FACILITY.— 

(A) IN GENERAL.—The following provisions of section 

45(d), as amended by paragraph (1), are each amended 

by striking ‘‘before January 1, 2014’’ and inserting ‘‘the 

construction of which begins before January 1, 2014’’: 

(i) Paragraph (1). 

(ii) Paragraph (2)(A)(i). 

(iii) Paragraph (3)(A)(i)(I). 

(iv) Paragraph (6). 

(v) Paragraph (7). 

(vi) Paragraph (9)(B). 

(vii) Paragraph (11)(B). 

(B) CERTAIN CLOSED-LOOP BIOMASS FACILITIES.— 

Subparagraph (A) of section 45(d)(2) is amended by adding 

at the end the following new flush sentence: 

‘‘For purposes of clause (ii), a facility shall be treated 

as modified before January 1, 2014, if the construction 

of such modification begins before such date.’’. 

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(C) CERTAIN OPEN-LOOP BIOMASS FACILITIES.—Clause 

(ii) of section 45(d)(3)(A) is amended by striking ‘‘is originally placed in service’’ and inserting ‘‘the construction 

of which begins’’. 

(D) GEOTHERMAL FACILITIES.— 

(i) IN GENERAL.—Paragraph (4) of section 45(d) 

is amended by striking ‘‘and before January 1, 2014’’ 

and all that follows and inserting ‘‘and which— 

‘‘(A) in the case of a facility using solar energy, is 

placed in service before January 1, 2006, or 

‘‘(B) in the case of a facility using geothermal energy, 

the construction of which begins before January 1, 2014. 

Such term shall not include any property described in section 

48(a)(3) the basis of which is taken into account by the taxpayer 

for purposes of determining the energy credit under section 

48.’’. 

(E) INCREMENTAL HYDROPOWER PRODUCTION.—Paragraph (9) of section 45(d) is amended— 

(i) by redesignating subparagraphs (A) and (B), 

as amended by subparagraph (A), as clauses (i) and 

(ii), respectively, and by moving such clauses (as so 

redesignated) 2 ems to the right, 

(ii) by striking ‘‘In the case of a facility’’ and 

inserting the following: 

‘‘(A) IN GENERAL.—In the case of a facility’’, 

(iii) by redesignating subparagraph (C) as subparagraph (B), and 

(iv) by adding at the end the following new 

subparagraph: 

‘‘(C) SPECIAL RULE.—For purposes of subparagraph 

(A)(i), an efficiency improvement or addition to capacity 

shall be treated as placed in service before January 1, 

2014, if the construction of such improvement or addition 

begins before such date.’’. 

(b) EXTENSION OF ELECTION TO TREAT QUALIFIED FACILITIES

AS ENERGY PROPERTY.—Subparagraph (C) of section 48(a)(5) is 

amended to read as follows: 

‘‘(C) QUALIFIED INVESTMENT CREDIT FACILITY.—For 

purposes of this paragraph, the term ‘qualified investment 

credit facility’ means any facility— 

‘‘(i) which is a qualified facility (within the 

meaning of section 45) described in paragraph (1), (2), 

(3), (4), (6), (7), (9), or (11) of section 45(d), 

‘‘(ii) which is placed in service after 2008 and the 

construction of which begins before January 1, 2014, 

and 

‘‘(iii) with respect to which— 

‘‘(I) no credit has been allowed under section 

45, and 

‘‘(II) the taxpayer makes an irrevocable election to have this paragraph apply.’’. 

(c) TECHNICAL CORRECTIONS.— (1) Subparagraph (D) of section 48(a)(5) is amended— 

(A) by striking ‘‘and’’ at the end of clause (i)(II), 

(B) by striking the period at the end of clause (ii) 

and inserting a comma, and 

(C) by adding at the end the following new clauses: 

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H. R. 8—30 

‘‘(iii) which is constructed, reconstructed, erected, 

or acquired by the taxpayer, and 

‘‘(iv) the original use of which commences with 

the taxpayer.’’. 

(2) Paragraphs (1) and (2) of subsection (a) of section 1603 

of division B of the American Recovery and Reinvestment Act 

of 2009 are each amended by striking ‘‘placed in service’’ and 

inserting ‘‘originally placed in service by such person’’. 

(d) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as provided in paragraphs (2) 

and (3), the amendments made by this section shall take effect 

on the date of the enactment of this Act. 

(2) MODIFICATION TO DEFINITION OF MUNICIPAL SOLID

WASTE.—The amendments made by subsection (a)(2) shall apply 

to electricity produced and sold after the date of the enactment 

of this Act, in taxable years ending after such date. 

(3) TECHNICAL CORRECTIONS.—The amendments made by 

subsection (c) shall apply as if included in the enactment of 

the provisions of the American Recovery and Reinvestment 

Act of 2009 to which they relate. 

SEC. 408. EXTENSION OF CREDIT FOR ENERGY-EFFICIENT NEW HOMES. 

(a) IN GENERAL.—Subsection (g) of section 45L is amended 

by striking ‘‘December 31, 2011’’ and inserting ‘‘December 31, 2013’’. 

(b) ENERGY SAVINGS REQUIREMENTS.—Clause (i) of section 

45L(c)(1)(A) is amended by striking ‘‘2003 International Energy 

Conservation Code, as such Code (including supplements) is in 

effect on the date of the enactment of this section’’and inserting 

‘‘2006 International Energy Conservation Code, as such Code 

(including supplements) is in effect on January 1, 2006’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to homes acquired after December 31, 2011. 

SEC. 409. EXTENSION OF CREDIT FOR ENERGY-EFFICIENT APPLIANCES. 

(a) IN GENERAL.—Section 45M(b) is amended by striking ‘‘2011’’ 

each place it appears other than in the provisions specified in 

subsection (b) and inserting ‘‘2011, 2012, or 2013’’. 

(b) PROVISIONS SPECIFIED.—The provisions of section 45M(b) 

specified in this subsection are subparagraph (C) of paragraph 

(1) and subparagraph (E) of paragraph (2). 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to appliances produced after December 31, 2011. 

SEC. 410. EXTENSION AND MODIFICATION OF SPECIAL ALLOWANCE 

FOR CELLULOSIC BIOFUEL PLANT PROPERTY. 

(a) EXTENSION.— 

(1) IN GENERAL.—Subparagraph (D) of section 168(l)(2) is 

amended by striking ‘‘January 1, 2013’’ and inserting ‘‘January 

1, 2014’’. 

(2) EFFECTIVE DATE.—The amendment made by this subsection shall apply to property placed in service after December 

31, 2012. 

(b) ALGAE TREATED AS A QUALIFIED FEEDSTOCK FOR PURPOSES

OF BONUS DEPRECIATION FOR BIOFUEL PLANT PROPERTY.— 

(1) IN GENERAL.—Subparagraph (A) of section 168(l)(2) is 

amended by striking ‘‘solely to produce cellulosic biofuel’’ and 

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H. R. 8—31 

inserting ‘‘solely to produce second generation biofuel (as 

defined in section 40(b)(6)(E))’’. 

(2) CONFORMING AMENDMENTS.—Subsection (l) of section 

168, as amended by subsection (a), is amended— 

(A) by striking ‘‘cellulosic biofuel’’ each place it appears 

in the text thereof and inserting ‘‘second generation 

biofuel’’, 

(B) by striking paragraph (3) and redesignating paragraphs (4) through (8) as paragraphs (3) through (7), 

respectively, 

(C) by striking ‘‘CELLULOSIC’’ in the heading of such 

subsection and inserting ‘‘SECOND GENERATION’’, and 

(D) by striking ‘‘CELLULOSIC’’ in the heading of paragraph (2) and inserting ‘‘SECOND GENERATION’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to property placed in service after the date 

of the enactment of this Act. 

SEC. 411. EXTENSION OF SPECIAL RULE FOR SALES OR DISPOSITIONS 

TO IMPLEMENT FERC OR STATE ELECTRIC RESTRUCTURING POLICY FOR QUALIFIED ELECTRIC UTILITIES. 

(a) IN GENERAL.—Paragraph (3) of section 451(i) is amended 

by striking ‘‘January 1, 2012’’ and inserting ‘‘January 1, 2014’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to dispositions after December 31, 2011. 

SEC. 412. EXTENSION OF ALTERNATIVE FUELS EXCISE TAX CREDITS. 

(a) IN GENERAL.—Sections 6426(d)(5) and 6426(e)(3) are each 

amended by striking ‘‘December 31, 2011’’ and inserting ‘‘December 

31, 2013’’. 

(b) OUTLAY PAYMENTS FOR ALTERNATIVE FUELS.—Paragraph 

(6) of section 6427(e) is amended— 

(1) in subparagraph (C)— 

(A) by striking ‘‘or alternative fuel mixture (as defined 

in subsection (d)(2) or (e)(3) of section 6426)’’ and inserting 

‘‘(as defined in section 6426(d)(2))’’, and 

(B) by striking ‘‘December 31, 2011, and’’ and inserting 

‘‘December 31, 2013,’’, 

(2) in subparagraph (D)— 

(A) by striking ‘‘or alternative fuel mixture’’, and 

(B) by striking the period at the end and inserting 

‘‘, and’’, and 

(3) by adding at the end the following new subparagraph: 

‘‘(E) any alternative fuel mixture (as defined in section 

6426(e)(2)) sold or used after December 31, 2011.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to fuel sold or used after December 31, 2011. 

TITLE V—UNEMPLOYMENT 

SEC. 501. EXTENSION OF EMERGENCY UNEMPLOYMENT COMPENSATION PROGRAM. 

(a) EXTENSION.—Section 4007(a)(2) of the Supplemental Appropriations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 note) 

is amended by striking ‘‘January 2, 2013’’ and inserting ‘‘January 

1, 2014’’. 

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(b) FUNDING.—Section 4004(e)(1) of the Supplemental Appropriations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 note) 

is amended— 

(1) in subparagraph (H), by striking ‘‘and’’ at the end; 

and 

(2) by inserting after subparagraph (I) the following: 

‘‘(J) the amendments made by section 501(a) of the 

American Taxpayer Relief Act of 2012;’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of the Unemployment Benefits Extension Act of 2012 (Public Law 112–96) 

SEC. 502. TEMPORARY EXTENSION OF EXTENDED BENEFIT PROVISIONS. 

(a) IN GENERAL.—Section 2005 of the Assistance for 

Unemployed Workers and Struggling Families Act, as contained 

in Public Law 111–5 (26 U.S.C. 3304 note), is amended— 

(1) by striking ‘‘December 31, 2012’’ each place it appears 

and inserting ‘‘December 31, 2013’’; and 

(2) in subsection (c), by striking ‘‘June 30, 2013’’ and 

inserting ‘‘June 30, 2014’’. 

(b) EXTENSION OF MATCHING FOR STATES WITH NO WAITING

WEEK.—Section 5 of the Unemployment Compensation Extension 

Act of 2008 (Public Law 110–449; 26 U.S.C. 3304 note) is amended 

by striking ‘‘June 30, 2013’’ and inserting ‘‘June 30, 2014’’. 

(c) EXTENSION OF MODIFICATION OF INDICATORS UNDER THE

EXTENDED BENEFIT PROGRAM.—Section 203 of the Federal-State 

Extended Unemployment Compensation Act of 1970 (26 U.S.C. 

3304 note) is amended— 

(1) in subsection (d), by striking ‘‘December 31, 2012’’ and 

inserting ‘‘December 31, 2013’’; and 

(2) in subsection (f)(2), by striking ‘‘December 31, 2012’’ 

and inserting ‘‘December 31, 2013’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of the Unemployment Benefits Extension Act of 2012 (Public Law 112–96). 

SEC. 503. EXTENSION OF FUNDING FOR REEMPLOYMENT SERVICES 

AND REEMPLOYMENT AND ELIGIBILITY ASSESSMENT 

ACTIVITIES. 

(a) IN GENERAL.—Section 4004(c)(2)(A) of the Supplemental 

Appropriations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 

note) is amended by striking ‘‘through fiscal year 2013’’ and 

inserting ‘‘through fiscal year 2014’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of the Unemployment Benefits Extension Act of 2012 (Public Law 112–96). 

SEC. 504. ADDITIONAL EXTENDED UNEMPLOYMENT BENEFITS UNDER 

THE RAILROAD UNEMPLOYMENT INSURANCE ACT. 

(a) EXTENSION.—Section 2(c)(2)(D)(iii) of the Railroad 

Unemployment Insurance Act, as added by section 2006 of the 

American Recovery and Reinvestment Act of 2009 (Public Law 

111–5) and as amended by section 9 of the Worker, Homeownership, 

and Business Assistance Act of 2009 (Public Law 111–92), section 

505 of the Tax Relief, Unemployment Insurance Reauthorization, 

and Job Creation Act of 2010 (Public Law 111–312), section 202 

of the Temporary Payroll Tax Cut Continuation Act of 2011 (Public 

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Law 112–78), and section 2124 of the Unemployment Benefits 

Extension Act of 2012 (Public Law 112–96), is amended— 

(1) by striking ‘‘June 30, 2012’’ and inserting ‘‘June 30, 

2013’’; and 

(2) by striking ‘‘December 31, 2012’’ and inserting 

‘‘December 31, 2013’’. 

(b) CLARIFICATION ON AUTHORITY TO USE FUNDS.—Funds 

appropriated under either the first or second sentence of clause 

(iv) of section 2(c)(2)(D) of the Railroad Unemployment Insurance 

Act shall be available to cover the cost of additional extended 

unemployment benefits provided under such section 2(c)(2)(D) by 

reason of the amendments made by subsection (a) as well as to 

cover the cost of such benefits provided under such section 

2(c)(2)(D), as in effect on the day before the date of enactment 

of this Act. 

(c) FUNDING FOR ADMINISTRATION.—Out of any funds in the 

Treasury not otherwise appropriated, there are appropriated to 

the Railroad Retirement Board $250,000 for administrative 

expenses associated with the payment of additional extended 

unemployment benefits provided under section 2(c)(2)(D) of the 

Railroad Unemployment Insurance Act by reason of the amendments made by subsection (a), to remain available until expended. 

TITLE VI—MEDICARE AND OTHER 

HEALTH EXTENSIONS 

Subtitle A—Medicare Extensions 

SEC. 601. MEDICARE PHYSICIAN PAYMENT UPDATE. 

(a) IN GENERAL.—Section 1848(d) of the Social Security Act 

(42 U.S.C. 1395w–4(d)) is amended by adding at the end the following new paragraph: 

‘‘(14) UPDATE FOR 2013.— ‘‘(A) IN GENERAL.—Subject to paragraphs (7)(B), (8)(B), 

(9)(B), (10)(B), (11)(B), (12)(B), and (13)(B), in lieu of the 

update to the single conversion factor established in paragraph (1)(C) that would otherwise apply for 2013, the 

update to the single conversion factor for such year shall 

be zero percent. 

‘‘(B) NO EFFECT ON COMPUTATION OF CONVERSION

FACTOR FOR 2014 AND SUBSEQUENT YEARS.—The conversion 

factor under this subsection shall be computed under paragraph (1)(A) for 2014 and subsequent years as if subparagraph (A) had never applied.’’. 

(b) ADVANCEMENT OF CLINICAL DATA REGISTRIES TO IMPROVE

THE QUALITY OF HEALTH CARE.— (1) IN GENERAL.—Section 1848(m)(3) of the Social Security 

Act (42 U.S.C. 1395w–4(m)(3)) is amended— 

(A) by redesignating subparagraph (D) as subparagraph (F); and 

(B) by inserting after subparagraph (C) the following 

new subparagraphs: 

‘‘(D) SATISFACTORY REPORTING MEASURES THROUGH

PARTICIPATION IN A QUALIFIED CLINICAL DATA REGISTRY.— 

For 2014 and subsequent years, the Secretary shall treat 

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an eligible professional as satisfactorily submitting data 

on quality measures under subparagraph (A) if, in lieu 

of reporting measures under subsection (k)(2)(C), the 

eligible professional is satisfactorily participating, as determined by the Secretary, in a qualified clinical data registry 

(as described in subparagraph (E)) for the year. 

‘‘(E) QUALIFIED CLINICAL DATA REGISTRY.— 

‘‘(i) IN GENERAL.—The Secretary shall establish 

requirements for an entity to be considered a qualified 

clinical data registry. Such requirements shall include 

a requirement that the entity provide the Secretary 

with such information, at such times, and in such 

manner, as the Secretary determines necessary to carry 

out this subsection. 

‘‘(ii) CONSIDERATIONS.—In establishing the requirements under clause (i), the Secretary shall consider 

whether an entity— 

‘‘(I) has in place mechanisms for the transparency of data elements and specifications, risk 

models, and measures; 

‘‘(II) requires the submission of data from 

participants with respect to multiple payers; 

‘‘(III) provides timely performance reports to 

participants at the individual participant level; and 

‘‘(IV) supports quality improvement initiatives 

for participants. 

‘‘(iii) MEASURES.—With respect to measures used 

by a qualified clinical data registry— 

‘‘(I) sections 1890(b)(7) and 1890A(a) shall not 

apply; and 

‘‘(II) measures endorsed by the entity with 

a contract with the Secretary under section 1890(a) 

may be used. 

‘‘(iv) CONSULTATION.—In carrying out this subparagraph, the Secretary shall consult with interested parties. 

‘‘(v) DETERMINATION.—The Secretary shall establish a process to determine whether or not an entity 

meets the requirements established under clause (i). 

Such process may involve one or both of the following: 

‘‘(I) A determination by the Secretary. 

‘‘(II) A designation by the Secretary of one 

or more independent organizations to make such 

determination.’’. 

(2) GAO STUDY AND REPORT ON INCORPORATING REGISTRY

DATA INTO THE MEDICARE PROGRAM IN ORDER TO IMPROVE

QUALITY AND EFFICIENCY.— 

(A) STUDY.—The Comptroller General of the United 

States shall conduct a study on the potential of clinical 

data registries to improve the quality and efficiency of 

care in the Medicare program, including through payment 

system incentives. Such study shall include an analysis 

of the role of health information technology in facilitating 

clinical data registries and the use of data from such registries among private health insurers as well as other entities the Comptroller General determines appropriate. 

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(B) REPORT.—Not later than November 15, 2013, the 

Comptroller General of the United States shall submit 

to Congress a report on the study conducted under subparagraph (A), together with recommendations for such legislation and administrative action as the Comptroller General 

determines appropriate. 

SEC. 602. WORK GEOGRAPHIC ADJUSTMENT. 

Section 1848(e)(1)(E) of the Social Security Act (42 U.S.C. 

1395w–4(e)(1)(E)) is amended by striking ‘‘before January 1, 2013’’ 

and inserting ‘‘before January 1, 2014’’. 

SEC. 603. PAYMENT FOR OUTPATIENT THERAPY SERVICES. 

(a) EXTENSION.—Section 1833(g) of the Social Security Act (42 

U.S.C. 1395l(g)) is amended— 

(1) in paragraph (5)(A), in the first sentence, by striking 

‘‘December 31, 2012’’ and inserting ‘‘December 31, 2013’’; and 

(2) in paragraph (6)— 

(A) by striking ‘‘December 31, 2012’’ and inserting 

‘‘December 31, 2013’’; and 

(B) by inserting ‘‘or 2013’’ after ‘‘during 2012’’. 

(b) APPLICATION OF THERAPY CAP TO THERAPY FURNISHED AS

PART OF OUTPATIENT CRITICAL ACCESS HOSPITAL SERVICES.—Section 1833(g)(6) of the Social Security Act (42 U.S.C. 1395l(g)(6)), 

as amended by subsection (a), is amended— 

(1) by striking ‘‘In applying’’ and inserting ‘‘(A) In applying’’; 

and 

(2) by adding at the end the following new subparagraph: 

‘‘(B)(i) With respect to outpatient therapy services furnished 

beginning on or after January 1, 2013, and before January 1, 

2014, for which payment is made under section 1834(g), the Secretary shall count toward the uniform dollar limitations described 

in paragraphs (1) and (3) and the threshold described in paragraph 

(5)(C) the amount that would be payable under this part if such 

services were paid under section 1834(k)(1)(B) instead of being 

paid under section 1834(g). 

‘‘(ii) Nothing in clause (i) shall be construed as changing the 

method of payment for outpatient therapy services under section 

1834(g).’’. 

(c) BENEFICIARY PROTECTIONS.—Section 1833(g)(5) of the Social 

Security Act (42 U.S.C. 1395l(g)(5)) is amended by adding at the 

end the following new subparagraph: 

‘‘(D) With respect to services furnished on or after January 

1, 2013, where payment may not be made as a result of application 

of paragraphs (1) and (3), section 1879 shall apply in the same 

manner as such section applies to a denial that is made by reason 

of section 1862(a)(1).’’. 

(d) IMPLEMENTATION.—Notwithstanding any other provision of 

law, the Secretary of Health and Human Services may implement 

the provisions of, and the amendments made by, this section by 

program instruction or otherwise. 

SEC. 604. AMBULANCE ADD-ON PAYMENTS. 

(a) GROUND AMBULANCE.—Section 1834(l)(13)(A) of the Social 

Security Act (42 U.S.C. 1395m(l)(13)(A)) is amended— 

(1) in the matter preceding clause (i), by striking ‘‘January 

1, 2013’’ and inserting ‘‘January 1, 2014’’; and 

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(2) in each of clauses (i) and (ii), by striking ‘‘January 

1, 2013’’ and inserting ‘‘January 1, 2014’’ each place it appears. 

(b) AIR AMBULANCE.—Section 146(b)(1) of the Medicare 

Improvements for Patients and Providers Act of 2008 (Public Law 

110–275), as amended by sections 3105(b) and 10311(b) of the 

Patient Protection and Affordable Care Act (Public Law 111–148), 

section 106(b) of the Medicare and Medicaid Extenders Act of 2010 

(Public Law 111–309), section 306(b) of the Temporary Payroll 

Tax Cut Continuation Act of 2011 (Public Law 112–78), and section 

3007(b) of the Middle Class Tax Relief and Job Creation Act of 

2012 (Public Law 112–96), is amended by striking ‘‘December 31, 

2012’’ and inserting ‘‘June 30, 2013’’. 

(c) SUPER RURAL AMBULANCE.—Section 1834(l)(12)(A) of the 

Social Security Act (42 U.S.C. 1395m(l)(12)(A)) is amended in the 

first sentence by striking ‘‘January 1, 2013’’ and inserting ‘‘January 

1, 2014’’. 

(d) STUDIES OF AMBULANCE COSTS.— 

(1) IN GENERAL.—The Secretary of Health and Health and 

Human Services (in this subsection referred to as the ‘‘Secretary’’) shall conduct a study of each of the following: 

(A) A study that analyzes data on existing cost reports 

for ambulance services furnished by hospitals and critical 

access hospitals, including variation by characteristics of 

such providers of services. 

(B) A study of the feasibility of obtaining cost data 

on a periodic basis from all ambulance providers of services 

and suppliers for potential use in examining the appropriateness of the Medicare add-on payments for ground 

ambulance services furnished under the fee schedule under 

section 1834(l) of the Social Security Act (42 U.S.C. 

1395m(l)) and in preparing for future reform of such payment system. 

(2) COMPONENTS OF ONE OF THE STUDIES.—In conducting 

the study under paragraph (1)(B), the Secretary shall— 

(A) consult with industry on the design of such cost 

collection efforts; 

(B) explore use of cost surveys and cost reports to 

collect appropriate cost data and the periodicity of such 

cost data collection; 

(C) examine the feasibility of development of a 

standard cost reporting tool for providers of services and 

suppliers of ground ambulance services; and 

(D) examine the ability to furnish such cost data by 

various types of ambulance providers of services and suppliers, especially by rural and super-rural providers of services and suppliers. 

(3) REPORTS.— (A) EXISTING COST REPORTS.—Not later than October 

1, 2013, the Secretary shall submit a report to Congress 

on the study conducted under paragraph (1)(A), together 

with recommendations for such legislation and administrative action as the Secretary determines appropriate. 

(B) OBTAINING COST DATA.—Not later than July 1, 

2014, the Secretary shall submit a report to Congress on 

the study conducted under paragraph (1)(B), together with 

recommendations for such legislation and administrative 

action as the Secretary determines appropriate. 

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SEC. 605. EXTENSION OF MEDICARE INPATIENT HOSPITAL PAYMENT 

ADJUSTMENT FOR LOW-VOLUME HOSPITALS. 

Section 1886(d)(12) of the Social Security Act (42 U.S.C. 

1395ww(d)(12)) is amended— 

(1) in subparagraph (B), in the matter preceding clause 

(i), by striking ‘‘2013’’ and inserting ‘‘2014’’; 

(2) in subparagraph (C)(i), by striking ‘‘and 2012’’ each 

place it appears and inserting ‘‘, 2012, and 2013’’; and 

(3) in subparagraph (D), by striking ‘‘and 2012’’ and 

inserting ‘‘, 2012, and 2013’’. 

SEC. 606. EXTENSION OF THE MEDICARE-DEPENDENT HOSPITAL (MDH) 

PROGRAM. 

(a) EXTENSION OF PAYMENT METHODOLOGY.—Section 

1886(d)(5)(G) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(G)) 

is amended— 

(1) in clause (i), by striking ‘‘October 1, 2012’’ and inserting 

‘‘October 1, 2013’’; and 

(2) in clause (ii)(II), by striking ‘‘October 1, 2012’’ and 

inserting ‘‘October 1, 2013’’. 

(b) CONFORMING AMENDMENTS.— 

(1) EXTENSION OF TARGET AMOUNT.—Section 1886(b)(3)(D) 

of the Social Security Act (42 U.S.C. 1395ww(b)(3)(D)) is 

amended— 

(A) in the matter preceding clause (i), by striking 

‘‘October 1, 2012’’ and inserting ‘‘October 1, 2013’’; and 

(B) in clause (iv), by striking ‘‘through fiscal year 2012’’ 

and inserting ‘‘through fiscal year 2013’’. 

(2) PERMITTING HOSPITALS TO DECLINE RECLASSIFICATION.— 

Section 13501(e)(2) of the Omnibus Budget Reconciliation Act 

of 1993 (42 U.S.C. 1395ww note) is amended by striking 

‘‘through fiscal year 2012’’ and inserting ‘‘through fiscal year 

2013’’. 

SEC. 607. EXTENSION FOR SPECIALIZED MEDICARE ADVANTAGE 

PLANS FOR SPECIAL NEEDS INDIVIDUALS. 

Section 1859(f)(1) of the Social Security Act (42 U.S.C. 1395w– 

28(f)(1)) is amended by striking ‘‘2014’’ and inserting ‘‘2015’’. 

SEC. 608. EXTENSION OF MEDICARE REASONABLE COST CONTRACTS. 

Section 1876(h)(5)(C)(ii) of the Social Security Act (42 U.S.C. 

1395mm(h)(5)(C)(ii)) is amended, in the matter preceding subclause 

(I), by striking ‘‘January 1, 2013’’ and inserting ‘‘January 1, 2014’’. 

SEC. 609. PERFORMANCE IMPROVEMENT. 

(a) EXTENSION OF FUNDING FOR CONTRACT WITH CONSENSUS- BASED ENTITY REGARDING PERFORMANCE MEASUREMENT.— (1) IN GENERAL.—Section 1890(d) of the Social Security 

Act (42 U.S.C. 1395aaa(d)) is amended by striking ‘‘fiscal years 

2009 through 2012’’ and inserting ‘‘fiscal years 2009 through 

2013’’. 

(2) REVISION TO DUTIES.—Section 1890(b) of the Social 

Security Act (42 U.S.C. 1395aaa(b)) is amended by striking 

paragraph (4). 

(b) PROVIDING DATA FOR PERFORMANCE IMPROVEMENT IN A

TIMELY MANNER.— 

(1) IN GENERAL.—The Secretary of Health and Human 

Services (in this subsection referred to as the ‘‘Secretary’’) shall 

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develop a strategy to provide data for performance improvement 

in a timely manner to applicable providers under the Medicare 

program under title XVIII of the Social Security Act (42 U.S.C. 

1395 et seq.), including with respect to the provision of the 

following: 

(A) Utilization data, including such data for items and 

services under parts A, B, and D of the Medicare program. 

(B) Feedback on quality data submitted by the 

applicable provider under the Medicare program. 

(2) CONSIDERATIONS.—In developing the strategy under 

paragraph (1), the Secretary shall consider— 

(A) the type of applicable provider receiving the data; 

(B) the frequency of providing the data so that it can 

be the most relevant in improving provider performance; 

(C) risk adjustment methods; 

(D) presentation of the data in a meaningful manner 

and easily understandable format; 

(E) with respect to utilization data, the provision of 

data that the Secretary determines would be useful to 

improve the performance of the type of applicable provider 

involved; and 

(F) administrative costs involved with providing data. 

(3) SUBMISSION AND AVAILABILITY OF INITIAL STRATEGY.— 

Not later than 1 year after the date of the enactment of this 

Act, the Secretary shall— 

(A) submit to the relevant committees of Congress 

the strategy described in paragraph (1); and 

(B) post such strategy on the website of the Centers 

for Medicare & Medicaid Services. 

(4) STRATEGY UPDATE.— (A) FEEDBACK FROM STAKEHOLDERS.—The Secretary 

shall seek feedback from stakeholders on the initial 

strategy submitted under paragraph (3). 

(B) STRATEGY UPDATE.—The Secretary shall— 

(i) update the strategy described in paragraph (1) 

based on the feedback submitted under subparagraph 

(A); and 

(ii) not later than 18 months after the date of 

the enactment of this Act— 

(I) submit such updated strategy to the relevant committees of Congress; and 

(II) post such updated strategy on the website 

of the Centers for Medicare & Medicaid Services. 

(5) GAO STUDY AND REPORT ON PRIVATE SECTOR INFORMATION SHARING ACTIVITIES.— 

(A) STUDY.—The Comptroller General of the United 

States (in this paragraph referred to as the ‘‘Comptroller 

General’’) shall conduct a study on information sharing 

activities. Such study shall include an analysis of— 

(i) how private sector entities share timely data 

with hospitals, physicians, and other providers and 

what lessons can be learned from those activities; 

(ii) how the Medicare program currently shares 

data with providers, including what data is provided 

and to which providers, and what divisions within 

the Centers for Medicare & Medicaid Services oversee 

those efforts; 

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(iii) what, if any, differences there are between 

the private sector and the Medicare program under 

title XVIII of the Social Security Act (42 U.S.C. 1395 

et seq.) in terms of sharing data; and 

(iv) what, if any, barriers there are for the Centers 

for Medicare & Medicaid Services to sharing timely 

data with applicable providers and recommendations 

to eliminate or reduce such barriers. 

(B) REPORT.—Not later than 8 months after the date 

of the enactment of this Act, the Comptroller General shall 

submit to the relevant committees of Congress a report 

containing the results of the study conducted under 

subparagraph (A), together with recommendations for such 

legislation and administrative action as the Comptroller 

General determines appropriate. 

(6) DEFINITIONS.—In this subsection: 

(A) APPLICABLE PROVIDER.—The term ‘‘applicable provider’’ means the following: 

(i) A critical access hospital (as defined in section 

1861(mm)(1) of the Social Security Act (42 U.S.C. 

1395xx(mm)(1))). 

(ii) A hospital (as defined in section 1861(e) of 

such Act (42 U.S.C. 1395x(e))). 

(iii) A physician (as defined in section 1861(r) of 

such Act (42 U.S.C. 1395x(r))). 

(iv) Any other provider the Secretary determines 

should receive the information described in subsection 

(a). 

(B) PERFORMANCE IMPROVEMENT.—The term ‘‘performance improvement’’ means improvements in quality, 

reducing per capita costs, and other criteria the Secretary 

determines appropriate. 

SEC. 610. EXTENSION OF FUNDING OUTREACH AND ASSISTANCE FOR 

LOW-INCOME PROGRAMS. 

(a) ADDITIONAL FUNDING FOR STATE HEALTH INSURANCE PRO- GRAMS.—Subsection (a)(1)(B) of section 119 of the Medicare 

Improvements for Patients and Providers Act of 2008 (42 U.S.C. 

1395b–3 note), as amended by section 3306 of the Patient Protection 

and Affordable Care Act Public Law 111–148), is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: ‘‘(iii) for fiscal year 2013, of $7,500,000.’’. 

(b) ADDITIONAL FUNDING FOR AREA AGENCIES ON AGING.— 

Subsection (b)(1)(B) of such section 119, as so amended, is 

amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: 

‘‘(iii) for fiscal year 2013, of $7,500,000.’’. 

(c) ADDITIONAL FUNDING FOR AGING AND DISABILITY RESOURCE

CENTERS.—Subsection (c)(1)(B) of such section 119, as so amended, 

is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

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(2) in clause (ii), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: 

‘‘(iii) for fiscal year 2013, of $5,000,000.’’. 

(d) ADDITIONAL FUNDING FOR CONTRACT WITH THE NATIONAL

CENTER FOR BENEFITS AND OUTREACH ENROLLMENT.—Subsection 

(d)(2) of such section 119, as so amended, is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: 

‘‘(iii) for fiscal year 2013, of $5,000,000.’’. 

Subtitle B—Other Health Extensions 

SEC. 621. EXTENSION OF THE QUALIFYING INDIVIDUAL (QI) PROGRAM. 

(a) EXTENSION.—Section 1902(a)(10)(E)(iv) of the Social Security 

Act (42 U.S.C. 1396a(a)(10)(E)(iv)) is amended by striking ‘‘2012’’ 

and inserting ‘‘2013’’. 

(b) EXTENDING TOTAL AMOUNT AVAILABLE FOR ALLOCATION.— 

Section 1933(g) of such Act (42 U.S.C. 1396u–3(g)) is amended— 

(1) in paragraph (2)— 

(A) in subparagraph (Q), by striking ‘‘and’’ after the 

semicolon; 

(B) in subparagraph (R), by striking the period at 

the end and inserting a semicolon; and 

(C) by adding at the end the following new subparagraphs: 

‘‘(S) for the period that begins on January 1, 2013, 

and ends on September 30, 2013, the total allocation 

amount is $485,000,000; and 

‘‘(T) for the period that begins on October 1, 2013, 

and ends on December 31, 2013, the total allocation amount 

is $300,000,000.’’; and 

(2) in paragraph (3), in the matter preceding subparagraph 

(A), by striking ‘‘or (R)’’ and inserting ‘‘(R), or (T)’’. 

SEC. 622. EXTENSION OF TRANSITIONAL MEDICAL ASSISTANCE (TMA). 

Sections 1902(e)(1)(B) and 1925(f) of the Social Security Act 

(42 U.S.C. 1396a(e)(1)(B), 1396r–6(f)) are each amended by striking 

‘‘2012’’ and inserting ‘‘2013’’. 

SEC. 623. EXTENSION OF MEDICAID AND CHIP EXPRESS LANE OPTION. 

Section 1902(e)(13)(I) of the Social Security Act (42 U.S.C. 

1396a(e)(13)(I)) is amended by striking ‘‘2013’’ and inserting ‘‘2014’’. 

SEC. 624. EXTENSION OF FAMILY-TO-FAMILY HEALTH INFORMATION 

CENTERS. 

Section 501(c)(1)(A)(iii) of the Social Security Act (42 U.S.C. 

701(c)(1)(A)(iii)) is amended by striking ‘‘2012’’ and inserting ‘‘2013’’. 

SEC. 625. EXTENSION OF SPECIAL DIABETES PROGRAM FOR TYPE I 

DIABETES AND FOR INDIANS. 

(a) SPECIAL DIABETES PROGRAMS FOR TYPE I DIABETES.—Section 330B(b)(2)(C) of the Public Health Service Act (42 U.S.C. 254c– 

2(b)(2)(C)) is amended by striking ‘‘2013’’ and inserting ‘‘2014’’. 

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(b) SPECIAL DIABETES PROGRAMS FOR INDIANS.—Section 

330C(c)(2)(C) of the Public Health Service Act (42 U.S.C. 254c– 

3(c)(2)(C)) is amended by striking ‘‘2013’’ and inserting ‘‘2014’’. 

Subtitle C—Other Health Provisions 

SEC. 631. IPPS DOCUMENTATION AND CODING ADJUSTMENT FOR 

IMPLEMENTATION OF MS-DRGS. 

(a) RULE OF CONSTRUCTION AND CLARIFICATION.— 

(1) RULE OF CONSTRUCTION.—Nothing in the amendments 

made by subsection (b) shall be construed as changing the 

existing authority under section 1886(d) of the Social Security 

Act (42 U.S.C. 1395ww(d)) to make prospective documentation 

and coding adjustments to the standardized amounts under 

such section 1886(d) to correct for changes in the coding or 

classification of discharges that do not reflect real changes 

in case mix. 

(2) CLARIFICATION.—Effective on the date of the enactment 

of this section, except as provided in section 7(b)(1)(B)(ii) of 

the TMA, Abstinence Education, and QI Programs Extension 

Act of 2007, as added by subsection (b)(2)(A)(ii)(IV) of this 

section, the Secretary of Health and Human Services shall 

not have authority to fully recoup past overpayments related 

to documentation and coding changes from fiscal years 2008 

and 2009. 

(b) ADJUSTMENT.—Section 7 of the TMA, Abstinence Education, 

and QI Programs Extension Act of 2007 (Public Law 110–90; 121 

Stat. 986) is amended— 

(1) in the heading, by striking ‘‘LIMITATION’’ and all that 

follows through ‘‘ADJUSTMENT’’ and inserting ‘‘DOCUMENTATION

AND CODING ADJUSTMENTS’’; and 

(2) in subsection (b)— 

(A) in paragraph (1)— 

(i) in the matter before subparagraph (A)— 

(I) by striking ‘‘or 2009’’ and inserting ‘‘, 2009, 

or 2010’’; and 

(II) by inserting ‘‘or otherwise applied for such 

year’’ after ‘‘applied under subsection (a)’’; and 

(ii) in subparagraph (B)— 

(I) by inserting ‘‘(i)’’ after ‘‘(B)’’; 

(II) by striking ‘‘or decrease’’; 

(III) by striking the period at the end and 

inserting ‘‘; and’’; and 

(IV) by adding at the end the following: 

‘‘(ii) make an additional adjustment to the standardized 

amounts under such section 1886(d) based upon the Secretary’s estimates for discharges occurring only during 

fiscal years 2014, 2015, 2016, and 2017 to fully offset 

$11,000,000,000 (which represents the amount of the 

increase in aggregate payments from fiscal years 2008 

through 2013 for which an adjustment was not previously 

applied).’’; and 

(B) in paragraph (3)— 

(i) in subparagraph (A), by inserting before the 

semicolon the following: ‘‘or affecting the Secretary’s 

authority under such paragraph to apply a prospective 

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adjustment to offset aggregate additional payments 

related to documentation and coding improvements 

made with respect to discharges during fiscal year 

2010’’; and 

(ii) in subparagraph (B), by striking ‘‘and 2012’’ 

and inserting ‘‘2012, 2014, 2015, 2016, and 2017’’. 

SEC. 632. REVISIONS TO THE MEDICARE ESRD BUNDLED PAYMENT 

SYSTEM TO REFLECT FINDINGS IN THE GAO REPORT. 

(a) ADJUSTMENT TO ESRD BUNDLED PAYMENT RATE TO

ACCOUNT FOR CHANGES IN THE UTILIZATION OF CERTAIN DRUGS

AND BIOLOGICALS.—Section 1881(b)(14) of the Social Security Act 

(42 U.S.C. 1395rr(b)(14)) is amended by adding at the end the 

following new subparagraph: 

‘‘(I) For services furnished on or after January 1, 2014, the 

Secretary shall, by comparing per patient utilization data from 

2007 with such data from 2012, make reductions to the single 

payment that would otherwise apply under this paragraph for renal 

dialysis services to reflect the Secretary’s estimate of the change 

in the utilization of drugs and biologicals described in clauses 

(ii), (iii), and (iv) of subparagraph (B) (other than oral-only ESRDrelated drugs, as such term is used in the final rule promulgated 

by the Secretary in the Federal Register on August 12, 2010 (75 

Fed. Reg. 49030)). In making reductions under the preceding sentence, the Secretary shall take into account the most recently available data on average sales prices and changes in prices for drugs 

and biological reflected in the ESRD market basket percentage 

increase factor under subparagraph (F).’’. 

(b) TWO-YEAR DELAY OF IMPLEMENTATION OF ORAL-ONLY ESRDRELATED DRUGS IN THE ESRD PROSPECTIVE PAYMENT SYSTEM; 

MONITORING.— (1) DELAY.—The Secretary of Health and Human Services 

may not implement the policy under section 413.174(f)(6) of 

title 42, Code of Federal Regulations (relating to oral-only 

ESRD-related drugs in the ESRD prospective payment system), 

prior to January 1, 2016. 

(2) MONITORING.—With respect to the implementation of 

oral-only ESRD-related drugs in the ESRD prospective payment 

system under subsection (b)(14) of section 1881 of the Social 

Security Act (42 U.S.C. 1395rr(b)(14)), the Secretary of Health 

and Human Services shall monitor the bone and mineral 

metabolism of individuals with end stage renal disease. 

(c) ANALYSIS OF CASE MIX PAYMENT ADJUSTMENTS.—By not 

later than January 1, 2016, the Secretary of Health and Human 

Services shall— 

(1) conduct an analysis of the case mix payment adjustments being used under section 1881(b)(14)(D)(i) of the Social 

Security Act (42 U.S.C. 1395rr(b)(14)(D)(i)); and 

(2) make appropriate revisions to such case mix payment 

adjustments. 

(d) UPDATED GAO REPORT.—Not later than December 31, 2015, 

the Comptroller General of the United States shall submit to Congress a report that updates the report submitted to Congress under 

section 10336 of the Patient Protection and Affordable Care Act 

(Public Law 111–148; 124 Stat. 974). The updated report shall 

include an analysis of how the Secretary of Health and Human 

Services has addressed points raised in the report submitted under 

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such section 10336 with respect to the Secretary’s preparations 

to implement payment for oral-only ESRD-related drugs in the 

bundled prospective payment system under section 1881(b)(14) of 

the Social Security Act (42 U.S.C. 1395rr(b)(14)). 

SEC. 633. TREATMENT OF MULTIPLE SERVICE PAYMENT POLICIES FOR 

THERAPY SERVICES. 

(a) SERVICES FURNISHED BY PHYSICIANS AND CERTAIN OTHER

PROVIDERS.—Section 1848(b)(7) of the Social Security Act (42 U.S.C. 

1395w–4(b)(7)) is amended— 

(1) by striking ‘‘2011,’’ and inserting ‘‘2011, and before 

April 1, 2013,’’; and 

(2) by adding at the end the following new sentence: ‘‘In 

the case of such services furnished on or after April 1, 2013, 

and for which payment is made under such fee schedules, 

instead of the 25 percent multiple procedure payment reduction 

specified in such final rule, the reduction percentage shall 

be 50 percent.’’. 

(b) SERVICES FURNISHED BY OTHER PROVIDERS.—Section 

1834(k) of the Social Security Act (42 U.S.C. 1395m(k)) is amended 

by adding at the end the following new paragraph: 

‘‘(7) ADJUSTMENT IN DISCOUNT FOR CERTAIN MULTIPLE

THERAPY SERVICES.—In the case of therapy services furnished 

on or after April 1, 2013, and for which payment is made 

under this subsection pursuant to the applicable fee schedule 

amount (as defined in paragraph (3)), instead of the 25 percent 

multiple procedure payment reduction specified in the final 

rule published by the Secretary in the Federal Register on 

November 29, 2010, the reduction percentage shall be 50 percent.’’. 

SEC. 634. PAYMENT FOR CERTAIN RADIOLOGY SERVICES FURNISHED 

UNDER THE MEDICARE HOSPITAL OUTPATIENT DEPARTMENT PROSPECTIVE PAYMENT SYSTEM. 

Section 1833(t)(16) of the Social Security Act (42 U.S.C. 

1395l(t)(16)) is amended by adding at the end the following new 

subparagraph: 

‘‘(D) SPECIAL PAYMENT RULE.— ‘‘(i) IN GENERAL.—In the case of covered OPD services furnished on or after April 1, 2013, in a hospital 

described in clause (ii), if— 

‘‘(I) the payment rate that would otherwise 

apply under this subsection for stereotactic 

radiosurgery, complete course of treatment of cranial lesion(s) consisting of 1 session that is multisource Cobalt 60 based (identified as of January 

1, 2013, by HCPCS code 77371 (and any succeeding 

code) and reimbursed as of such date under APC 

0127 (and any succeeding classification group)); 

exceeds 

‘‘(II) the payment rate that would otherwise 

apply under this subsection for linear accelerator 

based stereotactic radiosurgery, complete course 

of therapy in one session (identified as of January 

1, 2013, by HCPCS code G0173 (and any succeeding code) and reimbursed as of such date under 

APC 0067 (and any succeeding classification 

group)), 

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the payment rate for the service described in subclause 

(I) shall be reduced to an amount equal to the payment 

rate for the service described in subclause (II). 

‘‘(ii) HOSPITAL DESCRIBED.—A hospital described 

in this clause is a hospital that is not— 

‘‘(I) located in a rural area (as defined in section 1886(d)(2)(D)); 

‘‘(II) classified as a rural referral center under 

section 1886(d)(5)(C); or 

‘‘(III) a sole community hospital (as defined 

in section 1886(d)(5)(D)(iii)). 

‘‘(iii) NOT BUDGET NEUTRAL.—In making any 

budget neutrality adjustments under this subsection 

for 2013 (with respect to covered OPD services furnished on or after April 1, 2013, and before January 

1, 2014) or a subsequent year, the Secretary shall 

not take into account the reduced expenditures that 

result from the application of this subparagraph.’’. 

SEC. 635. ADJUSTMENT OF EQUIPMENT UTILIZATION RATE FOR 

ADVANCED IMAGING SERVICES. 

Section 1848 of the Social Security Act (42 U.S.C. 1395w– 

4) is amended— 

(1) in subsection (b)(4)(C)— 

(A) by striking ‘‘and subsequent years’’ and inserting 

‘‘, 2012, and 2013’’; and 

(B) by adding at the end the following new sentence: 

‘‘With respect to fee schedules established for 2014 and 

subsequent years, in such methodology, the Secretary shall 

use a 90 percent utilization rate.’’; and 

(2) in subsection (c)(2)(B)(v)(III), by striking ‘‘change in 

the utilization rate applicable to 2011, as described in’’ and 

inserting ‘‘changes in the utilization rate applicable to 2011 

and 2014, as described in the first and second sentence, respectively, of’’. 

SEC. 636. MEDICARE PAYMENT OF COMPETITIVE PRICES FOR 

DIABETIC SUPPLIES AND ELIMINATION OF OVERPAYMENT 

FOR DIABETIC SUPPLIES. 

(a) APPLICATION OF COMPETITIVE BIDDING PRICES FOR DIABETIC

SUPPLIES.—Section 1834(a)(1) of the Social Security Act (42 U.S.C. 

1395m(a)(1)) is amended— 

(1) in subparagraph (F), in the matter preceding clause 

(i), by striking ‘‘subparagraph (G)’’ and inserting ‘‘subparagraphs (G) and (H)’’; and 

(2) by adding at the end the following new subparagraph: 

‘‘(H) DIABETIC SUPPLIES.— ‘‘(i) IN GENERAL.—On or after the date described 

in clause (ii), the payment amount under this part 

for diabetic supplies, including testing strips, that are 

non-mail order items (as defined by the Secretary) 

shall be equal to the single payment amounts established under the national mail order competition for 

diabetic supplies under section 1847. 

‘‘(ii) DATE DESCRIBED.—The date described in this 

clause is the date of the implementation of the single 

payment amounts under the national mail order competition for diabetic supplies under section 1847.’’. 

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(b) OVERPAYMENT ELIMINATION FOR DIABETIC SUPPLIES.—Section 1834(a) of the Social Security Act (42 U.S.C. 1395m(a)) is 

amended by adding at the end the following new paragraph: 

‘‘(22) SPECIAL PAYMENT RULE FOR DIABETIC SUPPLIES.—Notwithstanding the preceding provisions of this subsection, for 

purposes of determining the payment amount under this subsection for diabetic supplies furnished on or after the first 

day of the calendar quarter during 2013 that is at least 30 

days after the date of the enactment of this paragraph and 

before the date described in paragraph (1)(H)(ii), the Secretary 

shall recalculate and apply the covered item update under 

paragraph (14) as if subparagraph (J)(i) of such paragraph 

was amended by striking ‘but only if furnished through mail 

order’.’’. 

SEC. 637. MEDICARE PAYMENT ADJUSTMENT FOR NON-EMERGENCY 

AMBULANCE TRANSPORTS FOR ESRD BENEFICIARIES. 

Section 1834(l) of the Social Security Act (42 U.S.C. 1395m(l)) 

is amended by adding at the end the following new paragraph: 

‘‘(15) PAYMENT ADJUSTMENT FOR NON-EMERGENCY AMBULANCE TRANSPORTS FOR ESRD BENEFICIARIES.—The fee schedule 

amount otherwise applicable under the preceding provisions 

of this subsection shall be reduced by 10 percent for ambulance 

services furnished on or after October 1, 2013, consisting of 

non-emergency basic life support services involving transport 

of an individual with end-stage renal disease for renal dialysis 

services (as described in section 1881(b)(14)(B)) furnished other 

than on an emergency basis by a provider of services or a 

renal dialysis facility.’’. 

SEC. 638. REMOVING OBSTACLES TO COLLECTION OF OVERPAYMENTS. 

(a) IN GENERAL.—The last sentence of subsections (b) and (c) 

of section 1870 of the Social Security Act (42 U.S.C. 1395gg) are 

each amended— 

(1) by striking ‘‘third year’’ and inserting ‘‘fifth year’’; and 

(2) by striking ‘‘three-year’’ and inserting ‘‘five-year’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall take effect on the date of the enactment of this Act. 

SEC. 639. MEDICARE ADVANTAGE CODING INTENSITY ADJUSTMENT. 

Section 1853(a)(1)(C)(ii)(III) of the Social Security Act (42 U.S.C. 

1395w–23(a)(1)(C)(ii)(III)) is amended— 

(1) by striking ‘‘1.3 percentage points’’ and inserting ‘‘1.5 

percentage points’’; and 

(2) by striking ‘‘5.7 percent’’ and inserting ‘‘5.9 percent’’. 

SEC. 640. ELIMINATION OF ALL FUNDING FOR THE MEDICARE 

IMPROVEMENT FUND. 

Section 1898(b)(1) of the Social Security Act (42 U.S.C. 

1395iii(b)(1)) is amended by striking subparagraphs (A), (B), and 

(C) and inserting the following new subparagraphs: ‘‘(A) fiscal year 2014, $0; and 

‘‘(B) fiscal year 2015, $0.’’. 

SEC. 641. REBASING OF STATE DSH ALLOTMENTS. 

Section 1923(f)(8) of the Social Security Act (42 U.S.C. 1396r– 

4(f)(8)) is amended to read as follows: 

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‘‘(8) SPECIAL RULES FOR CALCULATING DSH ALLOTMENTS FOR

CERTAIN FISCAL YEARS.— ‘‘(A) FISCAL YEAR 2021.—Only with respect to fiscal 

year 2021, the DSH allotment for a State, in lieu of the 

amount determined under paragraph (3) for the State for 

that year, shall be equal to the DSH allotment for the 

State as reduced under paragraph (7) for fiscal year 2020, 

increased, subject to subparagraphs (B) and (C) of paragraph (3), and paragraph (5), by the percentage change 

in the consumer price index for all urban consumers (all 

items; U.S. city average), for fiscal year 2020. 

‘‘(B) FISCAL YEAR 2022.—Only with respect to fiscal 

year 2022, the DSH allotment for a State, in lieu of the 

amount determined under paragraph (3) for the State for 

that year, shall be equal to the DSH allotment for the 

State for fiscal year 2021, as determined under subparagraph (A), increased, subject to subparagraphs (B) and 

(C) of paragraph (3), and paragraph (5), by the percentage 

change in the consumer price index for all urban consumers 

(all items; U.S. city average), for fiscal year 2021. 

‘‘(C) SUBSEQUENT FISCAL YEARS.—The DSH allotment 

for a State for fiscal years after fiscal year 2022 shall 

be calculated under paragraph (3) without regard to this 

paragraph and paragraph (7).’’. 

SEC. 642. REPEAL OF CLASS PROGRAM. 

(a) REPEAL.—Title XXXII of the Public Health Service Act (42 

U.S.C. 300ll et seq.; relating to the CLASS program) is repealed. 

(b) CONFORMING CHANGES.— (1) Title VIII of the Patient Protection and Affordable Care 

Act (Public Law 111–148; 124 Stat. 119, 846–847) is repealed. 

(2) Section 1902(a) of the Social Security Act (42 U.S.C. 

1396a(a)) is amended— 

(A) by striking paragraphs (81) and (82); 

(B) in paragraph (80), by inserting ‘‘and’’ at the end; 

and 

(C) by redesignating paragraph (83) as paragraph (81). 

(3) Paragraphs (2) and (3) of section 6021(d) of the Deficit 

Reduction Act of 2005 (42 U.S.C. 1396p note) are amended 

to read as such paragraphs were in effect on the day before 

the date of the enactment of section 8002(d) of the Patient 

Protection and Affordable Care Act (Public Law 111–148). Of 

the funds appropriated by paragraph (3) of such section 6021(d), 

as amended by the Patient Protection and Affordable Care 

Act, the unobligated balance is rescinded. 

SEC. 643. COMMISSION ON LONG-TERM CARE. 

(a) ESTABLISHMENT.—There is established a commission to be 

known as the Commission on Long-Term Care (referred to in this 

section as the ‘‘Commission’’). 

(b) DUTIES.— 

(1) IN GENERAL.—The Commission shall develop a plan 

for the establishment, implementation, and financing of a comprehensive, coordinated, and high-quality system that ensures 

the availability of long-term services and supports for individuals in need of such services and supports, including elderly 

individuals, individuals with substantial cognitive or functional 

limitations, other individuals who require assistance to perform 

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activities of daily living, and individuals desiring to plan for 

future long-term care needs. 

(2) EXISTING HEALTH CARE PROGRAMS.—For purposes of 

developing the plan described in paragraph (1), the Commission 

shall provide recommendations for— 

(A) addressing the interaction of a long-term services 

and support system with existing programs for long-term 

services and supports, including the Medicare program 

under title XVIII of the Social Security Act (42 U.S.C. 

1395 et seq.) and the Medicaid program under title XIX 

of the Social Security Act (42 U.S.C. 1396 et seq.), and 

private long-term care insurance; 

(B) improvements to such health care programs that 

are necessary for ensuring the availability of long-term 

services and supports; and 

(C) issues related to workers who provide long-term 

services and supports, including— 

(i) whether the number of such workers is adequate to provide long-term services and supports to 

individuals with long-term care needs; 

(ii) workforce development necessary to deliver 

high-quality services to such individuals; 

(iii) development of entities that have the capacity 

to serve as employers and fiscal agents for workers 

who provide long-term services and supports in the 

homes of such individuals; and 

(iv) addressing gaps in Federal and State infrastructure that prevent delivery of high-quality long 

term services and supports to such individuals. 

(3) ADDITIONAL CONSIDERATIONS.—For purposes of developing the plan described in paragraph (1), the Commission 

shall take into account projected demographic changes and 

trends in the population of the United States, as well as the 

potential for development of new technologies, delivery systems, 

or other mechanisms to improve the availability and quality 

of long-term services and supports. 

(4) CONSULTATION.—For purposes of developing the plan 

described in paragraph (1), the Commission shall consult with 

the Medicare Payment Advisory Commission, the Medicaid and 

CHIP Payment and Access Commission, the National Council 

on Disability, and relevant consumer groups. 

(c) MEMBERSHIP.— 

(1) IN GENERAL.—The Commission shall be composed of 

15 members, to be appointed not later than 30 days after 

the date of enactment of this Act, as follows: 

(A) The President of the United States shall appoint 

3 members. 

(B) The majority leader of the Senate shall appoint 

3 members. 

(C) The minority leader of the Senate shall appoint 

3 members. 

(D) The Speaker of the House of Representatives shall 

appoint 3 members. 

(E) The minority leader of the House of Representatives 

shall appoint 3 members. 

(2) REPRESENTATION.—The membership of the Commission 

shall include individuals who— 

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(A) represent the interests of— 

(i) consumers of long-term services and supports 

and related insurance products, as well as their representatives; 

(ii) older adults; 

(iii) individuals with cognitive or functional limitations; 

(iv) family caregivers for individuals described in 

clause (i), (ii), or (iii); 

(v) the health care workforce who directly provide 

long-term services and supports; 

(vi) private long-term care insurance providers; 

(vii) employers; 

(viii) State insurance departments; and 

(ix) State Medicaid agencies; 

(B) have demonstrated experience in dealing with 

issues related to long-term services and supports, health 

care policy, and public and private insurance; and 

(C) represent the health care interests and needs of 

a variety of geographic areas and demographic groups. 

(3) CHAIRMAN AND VICE-CHAIRMAN.—The Commission shall 

elect a chairman and vice chairman from among its members. 

(4) VACANCIES.—Any vacancy in the membership of the 

Commission shall be filled in the manner in which the original 

appointment was made and shall not affect the power of the 

remaining members to execute the duties of the Commission. 

(5) QUORUM.—A quorum shall consist of 8 members of 

the Commission, except that 4 members may conduct a hearing 

under subsection (e)(1). 

(6) MEETINGS.—The Commission shall meet at the call 

of its chairman or a majority of its members. 

(7) COMPENSATION AND REIMBURSEMENT OF EXPENSES.— 

(A) IN GENERAL.—To enable the Commission to exercise 

its powers, functions, and duties, there are authorized to 

be disbursed by the Senate the actual and necessary 

expenses of the Commission approved by the chairman 

and vice chairman, subject to subparagraph (B) and the 

rules and regulations of the Senate. 

(B) MEMBERS.—Members of the Commission are not 

entitled to receive compensation for service on the Commission. Members may be reimbursed for travel, subsistence, 

and other necessary expenses incurred in carrying out the 

duties of the Commission. 

(d) STAFF AND ETHICAL STANDARDS.— 

(1) STAFF.—The chairman and vice chairman of the 

Commission may jointly appoint and fix the compensation of 

staff as they deem necessary, within the guidelines for 

employees of the Senate and following all applicable rules and 

employment requirements of the Senate. 

(2) ETHICAL STANDARDS.—Members of the Commission who 

serve in the House of Representatives shall be governed by 

the ethics rules and requirements of the House. Members of 

the Senate who serve on the Commission and staff of the 

Commission shall comply with the ethics rules of the Senate. 

(e) POWERS.— (1) HEARINGS AND OTHER ACTIVITIES.—For the purpose of 

carrying out its duties, the Commission may hold such hearings 

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and undertake such other activities as the Commission determines to be necessary to carry out its duties. 

(2) STUDIES BY GENERAL ACCOUNTING OFFICE.—Upon the 

request of the Commission, the Comptroller General of the 

United States shall conduct such studies or investigations as 

the Commission determines to be necessary to carry out its 

duties. 

(3) COST ESTIMATES BY CONGRESSIONAL BUDGET OFFICE.— 

Upon the request of the Commission, the Director of the 

Congressional Budget Office shall provide to the Commission 

such cost estimates as the Commission determines to be necessary to carry out its duties. 

(4) DETAIL OF FEDERAL EMPLOYEES.—Upon the request of 

the Commission, the head of any Federal agency is authorized 

to detail, without reimbursement, any of the personnel of such 

agency to the Commission to assist the Commission in carrying 

out its duties. Any such detail shall not interrupt or otherwise 

affect the civil service status or privileges of the Federal 

employee. 

(5) TECHNICAL ASSISTANCE.—Upon the request of the 

Commission, the head of a Federal agency shall provide such 

technical assistance to the Commission as the Commission 

determines to be necessary to carry out its duties. 

(6) USE OF MAILS.—The Commission may use the United 

States mails in the same manner and under the same conditions 

as Federal agencies. 

(7) OBTAINING INFORMATION.—The Commission may secure 

directly from any Federal agency information necessary to 

enable it to carry out its duties, if the information may be 

disclosed under section 552 of title 5, United States Code. 

Upon request of the Chairman of the Commission, the head 

of such agency shall furnish such information to the Commission. 

(8) ADMINISTRATIVE SUPPORT SERVICES.—Upon the request 

of the Commission, the Administrator of General Services shall 

provide to the Commission on a reimbursable basis such 

administrative support services as the Commission may 

request. 

(f) COMMISSION CONSIDERATION.— 

(1) APPROVAL OF REPORT AND LEGISLATIVE LANGUAGE.— 

(A) IN GENERAL.—Not later than 6 months after 

appointment of the members of the Commission (as 

described in subsection (c)(1)), the Commission shall vote 

on a comprehensive and detailed report based on the longterm care plan described in subsection (b)(1) that contains 

any recommendations or proposals for legislative or 

administrative action as the Commission deems appropriate, including proposed legislative language to carry out 

the recommendations or proposals (referred to in this section as the ‘‘Commission bill’’). 

(B) APPROVAL BY MAJORITY OF MEMBERS.—The 

Commission bill shall require the approval of a majority 

of the members of the Commission. 

(2) TRANSMISSION OF COMMISSION BILL.— (A) IN GENERAL.—If the Commission bill is approved 

by the Commission pursuant to paragraph (1), then not 

later than 10 days after such approval, the Commission 

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shall submit the Commission bill to the President, the 

Vice President, the Speaker of the House of Representatives, and the majority and minority Leaders of each House 

on Congress. 

(B) COMMISSION BILL TO BE MADE PUBLIC.—Upon the 

approval or disapproval of the Commission bill pursuant 

to paragraph (1), the Commission shall promptly make 

such proposal, and a record of the vote, available to the 

public. 

(g) TERMINATION.—The Commission shall terminate 30 days 

after the vote described in subsection (f)(1). 

(h) CONSIDERATION OF COMMISSION RECOMMENDATIONS.—If 

approved by the majority required by subsection (f)(1), the Commission bill that has been submitted pursuant to subsection (f)(2)(A) 

shall be introduced in the Senate (by request) on the next day 

on which the Senate is in session by the majority leader of the 

Senate or by a Member of the Senate designated by the majority 

leader of the Senate and shall be introduced in the House of 

Representatives (by request) on the next legislative day by the 

majority leader of the House or by a member of the House designated by the majority leader of the House. 

SEC. 644. CONSUMER OPERATED AND ORIENTED PLAN PROGRAM 

CONTINGENCY FUND. 

(a) ESTABLISHMENT.—The Secretary of Health and Human 

Services shall establish a fund to be used to provide assistance 

and oversight to qualified nonprofit health insurance issuers that 

have been awarded loans or grants under section 1322 of the 

Patient Protection and Affordable Care Act (42 U.S.C. 18042) prior 

to the date of enactment of this Act. 

(b) TRANSFER AND RESCISSION.— (1) TRANSFER.—From the unobligated balance of funds 

appropriated under section 1322(g) of the Patient Protection 

and Affordable Care Act (42 U.S.C. 18042(g)), 10 percent of 

such sums are hereby transferred to the fund established under 

subsection (a) to remain available until expended. 

(2) RESCISSION.—Except as provided for in paragraph (1), 

amounts appropriated under section 1322(g) of the Patient 

Protection and Affordable Care Act (42 U.S.C. 18042(g)) that 

are unobligated as of the date of enactment of this Act are 

rescinded. 

TITLE VII—EXTENSION OF 

AGRICULTURAL PROGRAMS 

SEC. 701. 1-YEAR EXTENSION OF AGRICULTURAL PROGRAMS. 

(a) EXTENSION.—Except as otherwise provided in this section 

and amendments made by this section and notwithstanding any 

other provision of law, the authorities provided by each provision 

of the Food, Conservation, and Energy Act of 2008 (Public Law 

110–246; 122 Stat. 1651) and each amendment made by that Act 

(and for mandatory programs at such funding levels), as in effect 

on September 30, 2012, shall continue, and the Secretary of Agriculture shall carry out the authorities, until the later of— 

(1) September 30, 2013; or 

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(2) the date specified in the provision of that Act or amendment made by that Act. 

(b) COMMODITY PROGRAMS.— 

(1) IN GENERAL.—The terms and conditions applicable to 

a covered commodity or loan commodity (as those terms are 

defined in section 1001 of the Food, Conservation, and Energy 

Act of 2008 (7 U.S.C. 8702)) or to peanuts, sugarcane, or sugar 

beets for the 2012 crop year pursuant to title I of that Act 

(7 U.S.C. 8702 et seq.) and each amendment made by that 

title shall be applicable to the 2013 crop year for that covered 

commodity, loan commodity, peanuts, sugarcane, or sugar beets. 

(2) MILK.— 

(A) IN GENERAL.—Notwithstanding subsection (a), the 

Secretary of Agriculture shall carry out the dairy product 

price support program under section 1501 of the Food, 

Conservation, and Energy Act of 2008 (7 U.S.C. 8771) 

through December 31, 2013. 

(B) MILK INCOME LOSS CONTRACT PROGRAM.—Section 

1506 of the Food, Conservation, and Energy Act of 2008 

(7 U.S.C. 8773) is amended by striking ‘‘2012’’ each place 

it appears in subsections (c)(3), (d)(1), (d)(2), (e)(2)(A), (g), 

and (h)(1) and inserting ‘‘2013’’. 

(3) SUSPENSION OF PERMANENT PRICE SUPPORT AUTHORI- TIES.—The provisions of law specified in subsections (a) through 

(c) of section 1602 of the Food, Conservation, and Energy Act 

of 2008 (7 U.S.C. 8782) shall be suspended— 

(A) for the 2013 crop or production year of a covered 

commodity (as that term is defined in section 1001 of 

that Act (7 U.S.C. 8702)), peanuts, sugarcane, and sugar, 

as appropriate; and 

(B) in the case of milk, through December 31, 2013. 

(c) CONSERVATION PROGRAMS.— 

(1) CONSERVATION RESERVE.—Section 1231(d) of the Food 

Security Act of 1985 (16 U.S.C. 3831(d)) is amended in the 

second sentence by striking ‘‘and 2012’’ and inserting ‘‘2012, 

and 2013’’. 

(2) VOLUNTARY PUBLIC ACCESS.—Section 1240R of the Food 

Security Act of 1985 (16 U.S.C. 3839bb–5) is amended by 

striking subsection (f) and inserting the following: 

‘‘(f) FUNDING.— 

‘‘(1) FISCAL YEARS 2009 THROUGH 2012.—Of the funds of 

the Commodity Credit Corporation, the Secretary shall use 

to carry out this section, to the maximum extent practicable, 

$50,000,000 for the period of fiscal years 2009 through 2012. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this section $10,000,000 

for fiscal year 2013.’’. 

(d) SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM.— (1) EMPLOYMENT AND TRAINING PROGRAM.—Section 

16(h)(1)(A) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2025(h)(1)(A)) is amended by inserting ‘‘, except that for fiscal 

year 2013, the amount shall be $79,000,000’’ before the period 

at the end. 

(2) NUTRITION EDUCATION.—Section 28(d)(1) of the Food 

and Nutrition Act of 2008 (7 U.S.C. 2036a(d)(1)) is amended— 

(A) in subparagraph (A), by striking ‘‘and’’ after the 

semicolon at the end; and 

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(B) by striking subparagraph (B) and inserting the 

following: 

‘‘(B) for fiscal year 2012, $388,000,000; 

‘‘(C) for fiscal year 2013, $285,000,000; 

‘‘(D) for fiscal year 2014, $401,000,000; 

‘‘(E) for fiscal year 2015, $407,000,000; and 

‘‘(F) for fiscal year 2016 and each subsequent fiscal 

year, the applicable amount during the preceding fiscal 

year, as adjusted to reflect any increases for the 12-month 

period ending the preceding June 30 in the Consumer 

Price Index for All Urban Consumers published by the 

Bureau of Labor Statistics of the Department of Labor.’’. 

(e) RESEARCH PROGRAMS.— 

(1) ORGANIC AGRICULTURE RESEARCH AND EXTENSION INITIATIVE.—Section 1672B(f) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5925b(f)) is amended— 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘MANDATORY FUNDING FOR FISCAL

YEARS 2009 THROUGH 2012’’; 

(B) in the heading of paragraph (2), by striking ‘‘ADDITIONAL FUNDING’’ and inserting ‘‘DISCRETIONARY FUNDING

FOR FISCAL YEARS 2009 THROUGH 2012’’; and 

(C) by adding at the end the following: 

‘‘(3) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $25,000,000 for fiscal year 

2013.’’. 

(2) SPECIALTY CROP RESEARCH INITIATIVE.—Section 412(h) 

of the Agricultural Research, Extension, and Education Reform 

Act of 1998 (7 U.S.C. 7632(h)) is amended— 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘MANDATORY FUNDING FOR FISCAL

YEARS 2008 THROUGH 2012’’; 

(B) in the heading of paragraph (2), by inserting ‘‘FOR

FISCAL YEARS 2008 THROUGH 2012’’ after ‘‘APPROPRIATIONS’’; 

(C) by redesignating paragraphs (3) and (4) as paragraphs (4) and (5), respectively; and 

(D) by inserting after paragraph (2) the following: 

‘‘(3) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $100,000,000 for fiscal year 

2013.’’. 

(3) BEGINNING FARMER AND RANCHER DEVELOPMENT PROGRAM.—Section 7405(h) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 3319f(h)) is amended— 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘MANDATORY FUNDING FOR FISCAL

YEARS 2009 THROUGH 2012’’; 

(B) in the heading of paragraph (2), by inserting ‘‘FOR

FISCAL YEARS 2008 THROUGH 2012’’ after ‘‘APPROPRIATIONS’’; 

and 

(C) by adding at the end the following: 

‘‘(3) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $30,000,000 for fiscal year 

2013.’’. 

(f) ENERGY PROGRAMS.— 

(1) BIOBASED MARKETS PROGRAM.—Section 9002(h) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

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8102(h)) is amended in paragraph (2) by striking ‘‘2012’’ and 

inserting ‘‘2013’’. 

(2) BIOREFINERY ASSISTANCE.—Section 9003(h)(2) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8103(h)(2)) is amended by striking ‘‘2012’’ and inserting ‘‘2013’’. 

(3) REPOWERING ASSISTANCE.—Section 9004(d)(2) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8104(d)(2)) is amended by striking ‘‘2012’’ and inserting ‘‘2013’’. 

(4) BIOENERGY PROGRAM FOR ADVANCED BIOFUELS.—Section 

9005(g)(2) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 8105(g)(2)) is amended by striking ‘‘2012’’ 

and inserting ‘‘2013’’. 

(5) BIODIESEL FUEL EDUCATION PROGRAM.—Section 9006 

of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 8106) is amended by striking subsection (d) and inserting 

the following: 

‘‘(d) FUNDING.— 

‘‘(1) FISCAL YEARS 2009 THROUGH 2012.—Of the funds of 

the Commodity Credit Corporation, the Secretary shall use 

to carry out this section $1,000,000 for each of fiscal years 

2008 through 2012. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this section $1,000,000 

for fiscal year 2013.’’. 

(6) RURAL ENERGY FOR AMERICA PROGRAM.—Section 

9007(g)(3) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 8107(g)(3)) is amended by striking ‘‘2012’’ 

and inserting ‘‘2013’’. 

(7) BIOMASS RESEARCH AND DEVELOPMENT.—Section 

9008(h)(2) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 8108(h)(2)) is amended by striking ‘‘2012’’ 

and inserting ‘‘2013’’. 

(8) RURAL ENERGY SELF-SUFFICIENCY INITIATIVE.—Section 

9009(d) of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 8109(d)) is amended by striking ‘‘2012’’ and 

inserting ‘‘2013’’. 

(9) FEEDSTOCK FLEXIBILITY PROGRAM FOR BIOENERGY PRODUCERS.—Section 9010(b) of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 8110(b)) is amended in paragraphs (1)(A) and (2)(A) by striking ‘‘2012’’ each place it appears 

and inserting ‘‘2013’’. 

(10) BIOMASS CROP ASSISTANCE PROGRAM.—Section 9011(f) 

of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 8111(f)) is amended— 

(A) by striking ‘‘(f) FUNDING.—Of the funds’’ and 

inserting ‘‘(f) FUNDING.— 

‘‘(1) FISCAL YEARS 2008 THROUGH 2012.—Of the funds’’; and 

(B) adding at the end the following: 

‘‘(2) FISCAL YEAR 2013.— 

‘‘(A) IN GENERAL.—There is authorized to be appropriated to carry out this section $20,000,000 for fiscal year 

2013. 

‘‘(B) MULTIYEAR CONTRACTS.—For each multiyear contract entered into by the Secretary during a fiscal year 

under this paragraph, the Secretary shall ensure that sufficient funds are obligated from the amounts appropriated 

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H. R. 8—54 

for that fiscal year to fully cover all payments required 

by the contract for all years of the contract.’’. 

(11) FOREST BIOMASS FOR ENERGY.—Section 9012(d) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8112(d)) is amended by striking ‘‘2012’’ and inserting ‘‘2013’’. 

(12) COMMUNITY WOOD ENERGY PROGRAM.—Section 9013(e) 

of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 8113(e)) is amended by striking ‘‘2012’’ and inserting 

‘‘2013’’. 

(g) HORTICULTURE AND ORGANIC AGRICULTURE PROGRAMS.— (1) FARMERS MARKET PROMOTION PROGRAM.—Section 6(e) 

of the Farmer-to-Consumer Direct Marketing Act of 1976 (7 

U.S.C. 3005(e)) is amended— 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘FISCAL YEARS 2008 THROUGH 2012’’; 

(B) by redesignating paragraphs (2), (3), and (4) as 

paragraphs (3), (4), and (5), respectively; 

(C) by inserting after paragraph (1) the following: 

‘‘(2) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $10,000,000 for fiscal year 

2013.’’; 

(D) in paragraph (3) (as so redesignated), by striking 

‘‘paragraph (1)’’ and inserting ‘‘paragraph (1) or (2)’’; and 

(E) in paragraph (5) (as so redesignated), by striking 

‘‘paragraph (2)’’ and inserting ‘‘paragraph (3)’’. 

(2) NATIONAL CLEAN PLANT NETWORK.—Section 10202(e) 

of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 

7761(e)) is amended— 

(A) by striking ‘‘Of the funds’’ and inserting the following: 

‘‘(1) FISCAL YEARS 2009 THROUGH 2012.—Of the funds’’; and 

(B) by adding at the end the following: 

‘‘(2) FISCAL YEAR 2013.—There is authorized to be appro- priated to carry out the Program $5,000,000 for fiscal year 

2013.’’. 

(3) NATIONAL ORGANIC CERTIFICATION COST-SHARE PRO- GRAM.—Section 10606 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 6523) is amended— 

(A) in subsection (a), by striking ‘‘Of funds of the 

Commodity Credit Corporation, the Secretary of Agriculture (acting through the Agricultural Marketing Service) 

shall use $22,000,000 for fiscal year 2008, to remain available until expended, to’’ and inserting ‘‘The Secretary of 

Agriculture (acting through the Agricultural Marketing 

Service) shall’’; and 

(B) by adding at the end the following: 

‘‘(d) FUNDING.— ‘‘(1) MANDATORY FUNDING FOR FISCAL YEARS 2008 THROUGH

2012.—Of the funds of the Commodity Credit Corporation, the 

Secretary shall make available to carry out this section 

$22,000,000 for the period of fiscal years 2008 through 2012. 

‘‘(2) FISCAL YEAR 2013.—There is authorized to be appro- priated to carry out this section $22,000,000 for fiscal year 

2013, to remain available until expended.’’. 

(4) ORGANIC PRODUCTION AND MARKET DATA INITIATIVES.— Section 7407(d) of the Farm Security and Rural Investment 

Act of 2002 (7 U.S.C. 5925c(d)) is amended— 

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H. R. 8—55 

(A) in the heading of paragraph (1), by striking ‘‘IN

GENERAL’’ and inserting ‘‘MANDATORY FUNDING THROUGH

FISCAL YEAR 2012’’; 

(B) in the heading of paragraph (2), by striking ‘‘ADDITIONAL FUNDING’’ and inserting ‘‘DISCRETIONARY FUNDING

FOR FISCAL YEARS 2008 THROUGH 2012’’; and 

(C) by adding at the end the following: 

‘‘(3) FISCAL YEAR 2013.—There is authorized to be appropriated to carry out this section $5,000,000, to remain available 

until expended.’’. 

(h) OUTREACH AND TECHNICAL ASSISTANCE FOR SOCIALLY DISADVANTAGED FARMERS OR RANCHERS.—Section 2501(a)(4) of the 

Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 

2279(a)(4)) is amended— 

(1) in the heading of subparagraph (A), by striking ‘‘IN

GENERAL’’ and inserting ‘‘FISCAL YEARS 2009 THROUGH 2012’’; 

(2) by redesignating subparagraphs (B) and (C) as subparagraphs (C) and (D), respectively; 

(3) by inserting after subparagraph (A) the following: 

‘‘(B) FISCAL YEAR 2013.—There is authorized to be 

appropriated to carry out this section $20,000,000 for fiscal 

year 2013.’’; 

(4) in subparagraph (C) (as so redesignated), by striking 

‘‘subparagraph (A)’’ and inserting ‘‘subparagraph (A) or (B)’’; 

and 

(5) in subparagraph (D) (as so redesignated), by striking 

‘‘subparagraph (A)’’ and inserting ‘‘subparagraph (A) or (B)’’. 

(i) EXCEPTIONS.— (1) IN GENERAL.—Subsection (a) does not apply with respect 

to mandatory funding provided by programs authorized by 

provisions of law amended by subsections (d) through (h). 

(2) CONSERVATION.—Subsection (a) does not apply with 

respect to the programs specified in paragraphs (3)(B), (4), 

(6), and (7) of section 1241(a) of the Food Security Act of 

1985 (16 U.S.C. 3841(a)), relating to the conservation stewardship program, farmland protection program, environmental 

quality incentives program, and wildlife habitat incentives program, for which program authority was extended through fiscal 

year 2014 by section 716 of Public Law 112–55 (125 Stat. 

582). 

(3) TRADE.—Subsection (a) does not apply with respect 

to the following provisions of law: 

(A) Section 3206 of the Food, Conservation, and Energy 

Act of 2008 (7 U.S.C. 1726c) relating to the use of Commodity Credit Corporation funds to support local and 

regional food aid procurement projects. 

(B) Section 3107(l)(1) of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 1736o–1(l)(1)) relating 

to the use of Commodity Credit Corporation funds to carry 

out the McGovern-Dole International Food for Education 

and Child Nutrition Program. 

(4) SURVEY OF FOODS PURCHASED BY SCHOOL FOOD AUTHORITIES.—Subsection (a) does not apply with respect to section 

4307 of the Food, Conservation, and Energy Act of 2008 (Public 

Law 110–246; 122 Stat. 1893) relating to the use of Commodity 

Credit Corporation funds for a survey and report regarding 

foods purchased by school food authorities. 

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(5) RURAL DEVELOPMENT.—Subsection (a) does not apply 

with respect to the following provisions of law: 

(A) Section 379E(d)(1) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 2008s(d)(1)), relating to 

funding of the rural microentrepreneur assistance program. 

(B) Section 6029 of the Food, Conservation, and Energy 

Act of 2008 (Public Law 110–246; 122 Stat. 1955) relating 

to funding of pending rural development loan and grant 

applications. 

(C) Section 231(b)(7)(A) of the Agricultural Risk Protection Act of 2000 (7 U.S.C. 1632a(b)(7)(A)), relating to 

funding of value-added agricultural market development 

program grants. 

(D) Section 375(e)(6)(B) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 2008j(e)(6)(B)) relating 

to the use of Commodity Credit Corporation funds for the 

National Sheep Industry Improvement Center. 

(6) MARKET LOSS ASSISTANCE FOR ASPARAGUS PRODUCERS.— 

Subsection (a) does not apply with respect to section 10404(d) 

of the Food, Conservation, and Energy Act of 2008 (Public 

Law 110–246; 122 Stat. 2112). 

(7) SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE.— 

Subsection (a) does not apply with respect to section 531 of 

the Federal Crop Insurance Act (7 U.S.C. 1531) and title IX 

of the Trade Act of 1974 (19 U.S.C. 2497 et seq.) relating 

to the provision of supplemental agricultural disaster assistance. 

(8) PIGFORD CLAIMS.—Subsection (a) does not apply with 

respect to section 14012 of the Food, Conservation, and Energy 

Act of 2008 (Public Law 110–246; 122 Stat. 2209) relating 

to determination on the merits of Pigford claims. 

(9) HEARTLAND, HABITAT, HARVEST, AND HORTICULTURE ACT

OF 2008.—Subsection (a) does not apply with respect to title 

XV of the Food, Conservation, and Energy Act of 2008 (Public 

Law 110–246; 122 Stat. 2246), and amendments made by that 

title, relating to the provision of supplemental agricultural disaster assistance under title IX of the Trade Act of 1974 (19 

U.S.C. 2497 et seq.), certain revenue and tax provisions, and 

certain trade benefits and other matters. 

(j) EFFECTIVE DATE.—Except as otherwise provided in this section, this section and the amendments made by this section take 

effect on the earlier of— 

(1) the date of the enactment of this Act; or 

(2) September 30, 2012. 

SEC. 702. SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE. 

(a) IN GENERAL.—Section 531 of the Federal Crop Insurance 

Act (7 U.S.C. 1531) is amended— 

(1) in subsection (a)(5)— 

(A) in the matter preceding clause (i), by striking the 

first ‘‘under’’; and 

(B) by redesignating clauses (i) through (iii) as subparagraphs (A), (B), and (C), respectively, and indenting appropriately; 

(2) in subsection (c)— 

(A) in paragraph (1), by striking ‘‘use such sums as 

are necessary from the Trust Fund to’’; and 

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H. R. 8—57 

(B) by adding at the end the following: 

‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $80,000,000 

for each of fiscal years 2012 and 2013.’’; 

(3) in subsection (d)— 

(A) in paragraph (2), by striking ‘‘use such sums as 

are necessary from the Trust Fund to’’; and 

(B) by adding at the end the following: 

‘‘(7) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection 

$400,000,000 for each of fiscal years 2012 and 2013.’’; 

(4) in subsection (e)— 

(A) in paragraph (1), by striking ‘‘use up to $50,000,000 

per year from the Trust Fund to’’; and 

(B) by adding at the end the following: 

‘‘(4) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $50,000,000 

for each of fiscal years 2012 and 2013.’’; 

(5) in subsection (f)— 

(A) in paragraph (2)(A), by striking ‘‘use such sums 

as are necessary from the Trust Fund to’’; and 

(B) by adding at the end the following: 

‘‘(5) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $20,000,000 

for each of fiscal years 2012 and 2013.’’; and 

(6) in subsection (i), by inserting ‘‘or, in the case of subsections (c) through (f), September 30, 2013’’ after ‘‘2011,’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall take effect on October 1, 2012. 

TITLE VIII—MISCELLANEOUS 

PROVISIONS 

SEC. 801. STRATEGIC DELIVERY SYSTEMS. 

(a) IN GENERAL.—Paragraph 3 of section 495(c) of title 10, 

United States Code,, as added by section 1035 of the National 

Defense Authorization Act for Fiscal Year 2013, is amended— 

(1) by striking ‘‘that’’ before ‘‘the Russian Federation’’ and 

inserting ‘‘whether’’; and 

(2) by inserting ‘‘strategic’’ before ‘‘arms control obligations’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall take effect as if included in the enactment of the National 

Defense Authorization Act for Fiscal Year 2013. 

SEC. 802. NO COST OF LIVING ADJUSTMENT IN PAY OF MEMBERS 

OF CONGRESS. 

Notwithstanding any other provision of law, no adjustment 

shall be made under section 601(a) of the Legislative Reorganization 

Act of 1946 (2 U.S.C. 31) (relating to cost of living adjustments 

for Members of Congress) during fiscal year 2013. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 453
H. R. 8—58 

TITLE IX—BUDGET PROVISIONS 

Subtitle A—Modifications of Sequestration 

SEC. 901. TREATMENT OF SEQUESTER. 

(a) ADJUSTMENT.—Section 251A(3) of the Balanced Budget and 

Emergency Deficit Control Act of 1985 is amended— 

(1) in subparagraph (C), by striking ‘‘and’’ after the semicolon; 

(2) in subparagraph (D), by striking the period and 

inserting‘‘ ; and’’; and 

(3) by inserting at the end the following: 

‘‘(E) for fiscal year 2013, reducing the amount calculated under subparagraphs (A) through (D) by 

$24,000,000,000.’’. 

(b) AFTER SESSION SEQUESTER.—Notwithstanding any other 

provision of law, the fiscal year 2013 spending reductions required 

by section 251(a)(1) of the Balanced Budget and Emergency Deficit 

Control Act of 1985 shall be evaluated and implemented on March 

27, 2013. 

(c) POSTPONEMENT OF BUDGET CONTROL ACT SEQUESTER FOR

FISCAL YEAR 2013.—Section 251A of the Balanced Budget and 

Emergency Deficit Control Act of 1985 is amended— 

(1) in paragraph (4), by striking ‘‘January 2, 2013’’ and 

inserting ‘‘March 1, 2013’’; and 

(2) in paragraph (7)(A), by striking ‘‘January 2, 2013’’ and 

inserting ‘‘March 1, 2013’’. 

(d) ADDITIONAL ADJUSTMENTS.— 

(1) SECTION 251.—Paragraphs (2) and (3) of section 251(c) 

of the Balanced Budget and Emergency Deficit Control Act 

of 1985 are amended to read as follows: 

‘‘(2) for fiscal year 2013— 

‘‘(A) for the security category, as defined in section 

250(c)(4)(B), $684,000,000,000 in budget authority; and 

‘‘(B) for the nonsecurity category, as defined in section 

250(c)(4)(A), $359,000,000,000 in budget authority; 

‘‘(3) for fiscal year 2014— 

‘‘(A) for the security category, $552,000,000,000 in 

budget authority; and 

‘‘(B) for the nonsecurity category, $506,000,000,000 in 

budget authority;’’. 

(e) 2013 SEQUESTER.—On March 1, 2013, the President shall 

order a sequestration for fiscal year 2013 pursuant to section 251A 

of the Balanced Budget and Emergency Deficit Control Act of 1985, 

as amended by this section, pursuant to which, only for the purposes 

of the calculation in sections 251A(5)(A), 251A(6)(A), and 251A(7)(A), 

section 251(c)(2) shall be applied as if it read as follows: 

‘‘(2) For fiscal year 2013— 

‘‘(A) for the security category, $544,000,000,000 in 

budget authority; and 

‘‘(B) for the nonsecurity category, $499,000,000,000 in 

budget authority;’’. 

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SEC. 902. AMOUNTS IN APPLICABLE RETIREMENT PLANS MAY BE 

TRANSFERRED TO DESIGNATED ROTH ACCOUNTS WITHOUT DISTRIBUTION. 

(a) IN GENERAL.—Section 402A(c)(4) is amended by adding 

at the end the following: 

‘‘(E) SPECIAL RULE FOR CERTAIN TRANSFERS.—In the 

case of an applicable retirement plan which includes a 

qualified Roth contribution program— 

‘‘(i) the plan may allow an individual to elect to 

have the plan transfer any amount not otherwise 

distributable under the plan to a designated Roth 

account maintained for the benefit of the individual, 

‘‘(ii) such transfer shall be treated as a distribution 

to which this paragraph applies which was contributed 

in a qualified rollover contribution (within the meaning 

of section 408A(e)) to such account, and 

‘‘(iii) the plan shall not be treated as violating 

the provisions of section 401(k)(2)(B)(i), 403(b)(7)(A)(i), 

403(b)(11), or 457(d)(1)(A), or of section 8433 of title 

5, United States Code, solely by reason of such 

transfer.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to transfers after December 31, 2012, in taxable years 

ending after such date. 

Subtitle B—Budgetary Effects 

SEC. 911. BUDGETARY EFFECTS. 

(a) PAYGO SCORECARD.—The budgetary effects of this Act shall 

not be entered on either PAYGO scorecard maintained pursuant 

to section 4(d) of the Statutory Pay-As-You-Go Act of 2010. 

(b) SENATE PAYGO SCORECARD.—The budgetary effects of this 

Act shall not be entered on any PAYGO scorecard maintained 

for purposes of section 201 of S. Con. Res. 21 (110th Congress). 

Speaker of the House of Representatives. 

Vice President of the United States and

President of the Senate. 

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DEPUTY SECRETARY OF DEFENSE 

1010 DEFENSE PENTAGON 

WASHINGTON, DC 20301 · 1010 JAN 1 0 2013 

MEMORANDUM FOR SECRETARIES OF THE MILITARY DEPARTMENTS 

CHAIRMAN OF THE JOINT CHIEFS OF STAFF 

UNDER SECRET ARIES OF DEFENSE 

DEPUTY CHIEF MANAGEMENT OFFICER 

DIRECTOR, COST ASSESSMENT AND PROGRAM EVALUATION 

DIRECTOR, OPERATIONAL TEST AND EVALUATION 

GENERAL COUNSEL OF THE DEPARTMENT OF DEFENSE 

INSPECTOR GENERAL OF THE DEPARTMENT OF DEFENSE 

ASSIST ANT SECRETARIES OF DEFENSE 

DEPARTMENT OF DEFENSE CHIEF INFORMATION OFFICER 

ASSISTANTS TO THE SECRETARY OF DEFENSE 

DIRECTOR, ADMINISTRATION AND MANAGEMENT 

DIRECTOR, NET ASSESSMENT 

DIRECTORS OF THE DEFENSE AGENCIES 

DIRECTORS OF THE DOD FIELD ACTIVITIES 

SUBJECT: Handling Budgetary Uncertainty in Fiscal Year 2013 

Two sources of uncertainty are creating budgetary challenges for the Department of Defense 

(DoD) in 2013. The first is the fact that the Department is operating under a Continuing Resolution 

(CR) through at least March 27, 2013. Because most operating funding was planned to increase 

from Fiscal Year (FY) 2012 to FY 2013, but is instead being held at FY 2012levels under the CR, 

funds will run short at current rates of expenditure if the CR continues through the· end of the fiscal 

year in its current form. The Secretary will continue to urge the Congress to enact appropriations 

bills for FY 2013. But if the CR were to be extended through the end of the fiscal year, it would 

hinder our ability to maintain a ready force. 

The second source of uncertainty is the potential sequestration recently deferred from 

January 2, 2013 to March 1, 2013 by the American Taxpayer Relief Act of2012. The possibility of 

sequestration occurring as late as the beginning of the sixth month of the fiscal year creates 

significant additional uncertainty for the management of the Department. 

Either of these problems, in isolation, would present serious budget execution challenges to 

the Department, negatively impacting readiness and resulting in other undesirable outcomes. This 

situation would be made even more challenging by the need to protect funds for wartime operations. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 457
Near-Term Actions 

Given the overall budgetary uncertainty faced by the Department, and in particular the 

immediate operational issues presented by the CR, it is prudent to take certain steps now in order to 

help avoid serious future problems. I therefore authorize all Defense Components to begin 

implementing measures that will help mitigate our budget execution risks. For now, and to the 

extent possible, any actions taken must be reversible at a later date in the event that Congress acts to 

remove the risks I have described. The actions should be structured to minimize harmful effects on 

our people and on operations and unit readiness. 

Categories of approved actions are identified in Table 1. The authority to implement these 

actions shall remain in effect until they are revoked in a subsequent memorandum from my office. 

If Components believe they must take actions that go beyond the categories listed in Table 1, they 

should present the options for my review and approval prior to their implementation. 

Intensified Planning for Longer-Term Budgetary Uncertainty 

Given the added challenge of a potential sequestration in March, we must also intensify 

efforts to plan future actions that might be required should that happen. This planning does not 

assume these unfortunate events will occur, only that we must be ready. 

As they formulate draft plans, Components should follow the guidance that directs the 

Department to take all possible steps to mitigate harmful effects associated with this budgetary 

uncertainty and to maintain a strong defense. The details of the guidance are summarized below: 

• For the operating portions of the DoD budget: 

o Exempt all military personnel funding from sequestration reductions, in accordance 

with the decision made by the President in July 2012. 

o Fully protect funding for wartime operations. 

o Fully protect Wounded Warrior programs. 

o To the extent feasible, protect programs most closely associated with the new 

defense strategy. 

o Reduce civilian workforce costs using the following actions (all subject to missioncritical exemptions, and appropriate consultation with union representatives 

consistent with Executive Order 13522): 

• Release temporary employees and do not renew term hires. 

• Impose hiring freezes. 

• Authorize voluntary separation incentives and voluntary early retirements to the 

extent feasible. 

• Consider the possibility of furloughs of up to 30 calendar days or 22 

discontinuous workdays. 

o To the extent feasible, protect family programs. 

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Department of the Navy Administrative Record for FY 2013 Furlough Appeals 458
o To the extent feasible, protect fi.mding most directly associated with readiness; focus 

the necessary cuts on later deploying units. 

• For the investment portions of the DoD budget (procurement, RDT&E, construction): 

o Protect investments fi.mded in Overseas Contingency Operations if associated with 

urgent operational needs. 

o To the extent feasible, protect programs mostly closely associated with the new 

defense strategy. 

o Take prudent steps to minimize disruption and added costs (e.g., avoid penalties 

associated with potential contract cancellations where feasible; prudently manage 

construction projects fi.mded with prior-year monies). 

While we are hopeful of avoiding budgetary problems, draft Component plans should reflect 

the possibility that we may have to operate under a year-long CR and that sequestration takes place. 

Table 2 shows the types of information that should be included in the plans. Components should 

submit these draft plans to the Under Secretary of Defense (Comptroller) by February 1, 2013. The 

Under Secretary of Defense (Comptroller) will work with the Components to adjust this schedule if 

changes are required due to the deadlines for the preparation of the FY 2014 President's Budget 

submission. 

I appreciate your patience as we work through these difficult budgetary times. The 

Department will continue to do its best to resolve these budgetary uncertainties in a manner that 

permits us to support our current defense strategy and maintain a strong defense. 

If addressees have questions about this memorandum, they should direct them to the Under 

Secretary of Defense (Comptroller). 

Attachments: 

As stated 

3 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 459
Table 1. Categories of Approved Near-Term Actions 

• Freeze civilian hiring (with exceptions for mission-critical activities*). 

• Provide authority to terminate employment of temporary hires and to notify term employees 

that their contracts will not be renewed (with exceptions for mission-critical activities and 

when appropriate in terms of personnel timing*). 

• Reduce base operating funding. 

• Curtail travel, training, and conferences (all with exceptions for mission-critical activities* 

including those required to maintain professional licensure or equivalent certifications). 

• Curtail facilities maintenance or Facilities Sustainment, Restoration, and Modernization 

(FSRM) (with exceptions for mission-critical activities*). 

o If necessary, services/agencies are authorized to fund FSRM at levels below current 

guidance. 

• Curtail administrative expenses such as supply purchases, business IT, ceremonies, etc. 

(with exceptions for mission-critical activities*). 

• Review contracts and studies for possible cost-savings. 

• Cancel3rd and 4th quarter ship maintenance availabilities and aviation and ground depotlevel maintenance activities. Take this action no earlier than February 15, 2013. 

• Clear all R&D and production contracts and contract modifications that obligate more than 

$500 million with the USD(AT &L) prior to award. 

• For Science and Technology accounts, provide the USD(AT&L) and the Assistant Secretary 

of Defense (Research & Engineering) with an assessment of the impact that budgetary 

uncertainty may have on meeting Departmental research priorities. 

*Approvals will be granted by Component heads or by senior officials designated by the 

Component head. 

Components with personnel serving Combatant Commanders (COCOMs) must consult with the 

COCOMs before implementing actions that affect them. Disputes will be brought to the attention 

of the Chairman of the Joint Chiefs of Staff for further resolution. 

Components receiving reimbursements should coordinate with customer before taking actions that 

would affect the customer's mission. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 460
Table 2. Information to Be Included in Draft Implementation Plans 

The following information should be provided at the Component level. Information by commands 

and bases/installations is not required. 

• For operating accounts, identify major actions to include, at a minimum: 

o Extent of civilian hiring freezes; expected number of temps/terms released; expected 

number, duration, and nature of furloughs. 

o Reductions in flying hours, steaming days, vehicle miles, and other 

operations/training/support activities that affect force readiness. 

o Areas of budgets experiencing disproportionate cuts. 

• For investment accounts: 

o Plans for large programs (ACAT ID and IC, and MAIS programs). 

• Include major changes in unit buys, delays, etc. 

o Significant changes in all joint programs. 

• Identify and prioritize any essential reprogramming actions with offsets. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 461
EXECUTIVE OFFICE OF THE PRESIDENT 


OFFICE OF MANAGEMENT AND BUDGET 


WASHINGTON, D. C . 20503 


January 14,2013 

M-13-03 

MEMORANDUM FOR THE HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES 

FROM: 	 Jeffrey D. Zien!s ~Q~ Deputy Director a.nagement 

SUBJECT: 	 Planning for Uncertainty with Respect to Fiscal Year 2013 Budgetary Resources 

In the corning months, executive departments and agencies (agencies) will confront 

significant uncertainty regarding the amount of budgetary resources available for the remainder 

of the fiscal year. In particular, unless Congress acts to amend current law, the President is 

required to issue a sequestration order on March 1,2013, canceling approximately $85 billion in 

budgetary resources across the Federal Government. Further uncertainty is created by the 

expiration ofthe Continuing Appropriations Resolution, 2013 (CR) on March 27,2013. This 

memorandum directs agencies to take certain steps to plan for and manage this budgetary 

uncertainty. 

The Administration continues to urge Congress to take prompt action to address the 

current budgetary uncertainty, including through the enactment of balanced deficit reduction to 

avoid sequestration. Should Congress fail to act to avoid sequestration, there will be significant 

and harmful impacts on a wide variety of Government services and operations. For example, 

should sequestration remain in place for an extended period of time, hundreds of thousands of 

families will lose critical education and wellness services through Head Start and nutrition 

assistance programs. The Department of Defense will face deep cuts that will reduce readiness 

of non-deployed uni.ts delay needed investments in equipment and facilities, and cut services for 

military families. And Federal agencies will likely need to furlough hundreds ofthousands of 

employees and reduce essential ervices uch a food inspections, air travel safety, prison 

security, border patrols, and other mission-critical activities. 

At this time, agencies do not have clarity regarding the manner in which Congress will 

address .these issues or the amount of budgetary resources that will be available through the 

remainder of the fiscal year. Until Congress acts, agencies must continue to prepare for the 

possibility that they will need to operate with reduced budgetary resources. 

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Department of the Navy Administrative Record for FY 2013 Furlough Appeals 462
Prior-to passage ofthe American Taxpayer Relief Act of2012 (ATRA), the President 

was required to issue a sequestration order on January 2, 2013. Although the ATRA postponed 

this date by two months, agencies had already engaged in extensive planning for operations 

under post-sequestration funding levels before this postponement was effected. In light of 

persistent budgetary uncertainty, all agencies should continue these planning activities, in 

coordination with the Office of Management and Budget COMB), and should intensify efforts to 

identify actions that may be required should sequestration occur. 

Agencies should generally adhere to the following guiding principles, to the extent 

practicable and appropriate, in preparing plans to operate with reduced budgetary resources in 

the event that sequestration occurs: 

• 	 use any available flexibility to reduce operational risks and minimize impacts on the 

agency's core mission in service ofthe American people; 

• 	 identify and address operational challenges that could potentially have a significant 

deleterious effect on the agency's mission or otherwise raise life, safety, or health 

concerns; 

• 	 identify the most appropriate means to reduce civilian workforce costs where necessarythis may include imposing hiring freezes, releasing temporary employees or not renewing 

term or contract hires, authorizing voluntary separation incentives and voluntary early 

retirements, or implementing administrative furloughs (appropriate guidance for 

administrative furloughs can be found on the OPM website [herel); consistent with 

Section 3(a)(ii) of Executive Order 13522, allow employees' exclusive representatives to 

have pre-decisional involvement in these matters to the fullest extent practicable; 

• 	 review grants and contracts to determine where cost savings may be achieved in a manner 

that is consistent with the applicable terms and conditions, remaining mindful of the 

manner in which individual contracts or grants advance the core mission ofthe agency; 

• 	 take into account funding flexibilities, including the availability ofreprogramming and 

transfer authority; and, 

• 	 be cognizant ofthe requirements ofthe Worker Adjustment and Retraining Notification 

(WARN) Act, 29 U.S.C. §§ 2101-2109. 

While agency plans should reflect intensified efforts to prepare for operations under a 

potential sequestration, actions that would implement reductions specifically designed as a 

response to sequestration should generally not be taken at this time. In some cases, however, the 

overall budgetary uncertainty and operational constraints may require that certain actions be 

taken in the immediate- or near-term. Agencies presented with these circumstances should 

continue to act in a prudent manner to ensure that operational risks are avoided and adequate 

funding is available for the remainder ofthe fiscal year to meet the agency's core requirements 

and mission. Should circumstances require an agency to take actions that would constitute a 

change from normal practice and result in a reduction of normal spending and operations in the 

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immedjate- or near-term, the agency must coordinate closely with its OMB Resource 

Management Office (RMO) before taking any sucb actions. 

All agencies should work with their OMB RMO on the appropriate timing to submit draft 

contingency plans for operating under equestration for review. Furthermore, should Congress 

take action that affects the current budgetary uncertaint), OMB will provide agencies with 

additional guidance as appropriate. 

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 The FY 2013 Overseas Contingency Operation (OCO) budget request. 

 The FY 2012 and earlier prior year unobligated balances for active accounts. The current 

forecast for unobligated balances in this guidance uses data through 31 December 2012. 

Sequestration Impact = (FY 2013 Annualized CR + FY 2013 OCO request + PY Unobligated Balances) * 9% 

a. Until a more definitized sequestration number is available, a 9% reduction will be applied 

to the sequestration base shown above. BSOs should be aware that the unobligated balance 

forecast will be updated to include an obligation projection through the end of February of 2013 

for final planning estimates, however, this data will not be available from OSD until ~20 

January. Revised OSD unobligated balance data will be provided as soon as available. FMB 

will work with BSOs where any significant changes are observed. 

b. The DON also assumes that it will be expected to continue to operate within the 

limitations of an annualized Continuing Resolution, which reduces flexibility - no FY 2013 new 

starts and no quantity increases from the FY 2012 enactment to the FY 2013 CR level. As a 

result, the program control will be established as follows: 

(1) The sequestration reduction described above will be applied to the lower of either the FY 

2013 Annualized CR amount (FY 2012+0.612%), or the FY 2013 President’s Budget 

Request. 

(2) Military Personnel funding is excluded from sequestration action but not from the CR. 

(3) Where the PB13 amount was lower than the annualized level of the FY2013 CR, no CR 

adjustment has been made. Where the FY 2013 CR amount was lower than PB13, an 

adjustment has been entered - - thereby picking the lower of either the FY 2013 annualized 

CR or PB13 amounts. 

(4) The purpose for this is to exclude funds from consideration that might not materialize under 

an appropriation that would artificially enhance budgets. 

c. Enclosure (1) reflects the proposed controls as articulated above. Due to the large 

number of prior year projects and the large prior year balances in SCN and MILCON, including 

many ships and projects that do not have funding in FY 2013, enclosure (1) provides total 

sequestration amounts at the appropriation level for SCN, MCN, MCNR, and FHCON. 

Distribution by fiscal year and line item will be provided separately by FMB 2. 

d. While there may be reprogramming authority or other mechanisms provided later for 

realignments across appropriation, this DON effort presumes no flexibility for realignments 

within the FY 2013 CR. Also, the sequestration reductions provided must be applied at the PPA 

level (P-1/R-1/C-1) for investment accounts in FY 2013, but may be realigned among FY 2013 

and prior years with active and available unobligated balances. Enclosure (2) provides a 

template for BSOs to complete to report recommended adjustments across fiscal years within a 

P-1/R-1/C-1 line item. 

5. Civilian Personnel. 

a. Hiring Freeze. Per references (a) and (b), a hiring freeze is now in effect for Navy 

commands. This hiring freeze will be managed by BSO Commanders. Hiring actions may be 

performed under the hiring freeze for critical billets that the Commander defines as “essential.” 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 466
3 

No additional job offers will be made by the OCHR Human Resources Service Centers until 

each BSO develops and issues their hiring freeze plan. BSOs must satisfy their local union 

notification and bargaining requirements associated with their plan. The Marine Corps direction 

regarding potential civilian personnel actions will be issued by HQMC to reflect decisions by the 

Commandant, as applicable. Any Marine Corps hiring freeze will be announced separately and 

managed by HQMC. ASN(M&RA) will work with individual BSOs to address questions and 

approve hiring freeze plans. ASN(M&RA) POC for the hiring freeze is Mr. Doug Lundberg at 

Douglas.Lundberg@navy.mil. 

1) BSOs are alerted that for reimbursable billets the fund holder must coordinate with the BSO 

early enough to ensure that the reimbursable workforce is planned, available, and funded. 

2) More specifically, NAVSEA and the Shipyards must coordinate with the Fleets, as the fund 

holder, to ensure proper levels of reimbursable workforce are planned and funded. Joint 

decisions to determine essential work and appropriate work force are essential. 

3) Beyond the Fleet workforce, BSOs must be sensitive to other reimbursable work, e.g., 

SOCOM, DHP, Intelligence, and FMS 

4) DoD has authorized voluntary separation incentives and voluntary early retirements. BSOs 

can look at this option when considering personnel action. 

b. Civilian Personnel Furlough. If implemented, civilian furloughs will be centrally 

managed and will be a government-wide effort with limited exceptions. The White House will 

control future guidance with respect to a civilian furlough. Within this effort, BSOs should 

assume in their implementation plans a one-day furlough per week starting 16 April 2013 and 

continuing for 22 weeks. In any cases where risk to safety or security are untenable, BSOs 

should submit an impact statement highlighting the specific issue or circumstance that will result 

from the furlough. In the event a furlough is not authorized, BSOs should be assessing 

alternative measures to achieve the required reductions. OCHR will provide supplemental 

guidance on furloughs. ASN(M&RA) POC for furloughs is Mr. Doug Lundberg at 

Douglas.Lundberg@navy.mil. 

c. Temporary and Term Employment. Per references (a) and (b), BSO Commanders are 

authorized to reduce temporary and term employee levels. BSO Commanders will manage this 

effort for critical billets that the Commander defines as “essential.” BSOs are reminded that Tier 

Alpha presumed a level of savings from these cuts. If temp and term savings do not materialize, 

BSOs would have to offer alternate cuts. The termination of term employees may require 

advance notice and appeal rights. When developing plans, BSOs should not propose releasing 

temporary employees prior to 15 February. You should consult with OCHR if terminating term 

employees is part of your proposed action plan. ASN(M&RA) POC for temporary and term 

employee action is Mr. Doug Lundberg at Douglas.Lundberg@navy.mil.

d. Navy Working Capital Fund (NWCF). As civilian personnel at NWCF entities are driven 

by workload requirements, coordination between customers and WCF entities is critical to 

ensuring an appropriately sized WCF workforce. Revised customer spend plans will drive 

changes to WCF requirements. Requirements from paragraph 4.a, 4.b, and 4.c above apply to 

WCF employees as well. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 467
4 

6. Implementation Plans and Impact. Based on the CR and sequestration targets provided in 

enclosure (1), BSOs will develop implementation plans in PBIS for O&M, SCN, and Military 

Construction and will submit sequestration impact statements based on the below direction. 

Specific direction is as follows: 

a. Operation and Maintenance Accounts. FMB has coordinated extensively with BSO 

Comptrollers on the development of Tier Alpha cuts to address the CR, and is working on Tier 

Bravo options to deal with sequestration reductions. Revised BSO targets for the CR and 

sequestration adjustments are provided in enclosure (1) and in a new PBIS control table entitled 

“Sequestration Planning Control”. BSOs will note that CR and sequestration targets are 

provided at the appropriation level of funding, and these adjustments must be spread by AG SAG 

in PBIS. As stated, CR rules allow BSOs flexibility to apply the CR adjustments as appropriate 

to achieve the previously coordinated Tier Alpha reductions - - sequestration cuts to be addressed 

by the Tier Bravo options will be developed. BSO implementation plans will be due in PBIS to 

FMB NLT than 25 January 2013. For updates to any unexpected O&M adjustments in Tier 

Alpha, BSOs will submit an implementation impact statement to FMB1 describing the change. 

In addition, the following should be provided per reference (a): 

 Extent of civilian hiring freezes, expected number of temps/terms released; impact of the 

furlough. 

 Reduction to Flying Hour, Steaming Days, Vehicle Miles and other operations/training/support 

activities that affect force readiness. 

 Any areas receiving disproportionate cuts 

Questions regarding O&M implementation plans or impact statements should be forwarded to 

James.Moser@navy.mil or james.moser@navy.smil.mil. 

b. Investment Accounts: For procurement, research and development accounts, 

sequestration and CR impacts (where applicable) are applied at the Line Item (P-1, R-1) level of 

detail. Sequestration adjustments may be made for all investment programs at the PPA level by 

realigning the sequestration reduction among FY13 funding and any prior years with active and 

available unobligated balances. These recommended adjustments will be provided to FMB 2 in 

the enclosure (2) template addressed in paragraph 3.d and will be entered in PBIS for Issue 

64293 at the P-1, R-1 and C-1 level of detail. BSO input for PBIS records and enclosure (2) will 

be due to FMB NLT than 25 January 2013. 

For significant investment programs (ACAT 1D, ACAT 1C, MAIS, Joint, Special Interest) an 

implementation impact statement will be submitted to FMB 2. Enclosure (3) provides the 

template to be used to report recommended sequestration adjustments among fiscal years for a 

line item, the impact of a year-long CR (funding, authorization, new starts, quantity impact, rate 

of operations, multiyear procurement), and the impact to the program of the sequestration 

reduction. Enclosures (2) and (3) will be used for the development of the DON submission to 

OSD, possible year-long CR anomalies, and follow-on actions to sequestration. Questions 

regarding investment spend plans or impact statements should be forwarded to 

Burchard.Jackson@navy.mil or Burchard.Jackson@navy.smil.mil . 

c. Construction and Family Housing accounts. NAVFAC will work with FMB2 to report 

CR and sequestration impact by project and year for Military Construction and Family Housing 

Construction. In addition, for Family Housing Operations, any Quality of Life issues should be 

identified. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 468
5 

d. Navy Working Capital Fund (NWCF). NWCF activities should coordinate with the 

BSOs on potential reductions in customer funding for their planned DON orders. BSOs are 

requested to complete enclosure (4) to indicate where proposed reductions will significantly 

impact NWCF customer orders. This information will be used in a subsequent data call to 

NWCF Activities to assess changes to FY 2013 financial operations, including revenue and net 

operating results. Questions on this template should be directed to the acting FMB 41, CDR 

Steve Macdonald, at 703-692-4842. 

e. Military Personnel. While Military personnel accounts were exempted by sequestration, 

they are affected by the continuing resolution. BSOs will submit revised implementation plans 

for military personnel accounts to account for the impacts of the CR highlighted in enclosure (1) 

and are due to FMB NLT than 25 January 2013. BSOs should take into account any underexecution in FY 2013 that will result in surpluses and report these via enclosure (3) to FMB1. 

f. Conferences for all Appropriations. Any government-sponsored conferences scheduled 

from January to March 2013 should be postponed to April or beyond. Per current approval 

authorities, re-approval is required for those conferences that cannot be easily delayed, are 

considered absolutely mission essential, or are required to maintain professional license or 

equivalent certifications. Re-approval will be contingent on showing estimated costs have been 

minimized to the greatest degree possible. For non-government sponsored conferences, U.S. 

government participation is not prohibited, but should contribute to the DON's mission and be 

adjusted to minimize costs, especially travel and lodging. Invited speakers included in 

conference requests should seek the approval of the next higher command level to verify speaker 

need before the conference request is submitted for re-approval. All future conference requests 

will include a FO/GO/SES endorsement highlighting how costs have been minimized and 

whether the conference is mission critical and/or fulfills license and certification requirements. 

g. Travel and Training for all Appropriations. All non-mission essential travel and training 

should be minimized to the greatest degree possible. The first FO/GO/SES in the chain of 

command should determine whether travel is mission essential. This guidance is effective 

through 1 April. It will then be reviewed and adjusted based on the outcome of the final FY 

2013 topline. 

7. New Starts, Quantity Increases and Multiyear Procurements. While under a year-long CR, 

DoN commands do not have the authority to initiate any FY 2013 new starts, multiyear 

procurements, or contract for increases in procurement over FY 2012 quantities. These limits 

must be considered by BSOs when developing investment implementation plans. The impact 

statements should address any problems with these CR limitations which may later be included 

as legislative proposals or anomalies in requesting relief form OMB and /or congress. 

8. Control of pre-decisional information. Participants are reminded that discussion of 

sequestration information outside of DoD is not permitted. 

9. Congressional and Public Affairs Guidance. CHINFO is the central control authority for 

messaging and the DON narrative related to either the CR, or sequestration. Requests for 

information from any organization on these topics should be coordinated with CHINFO to 

ensure a consistent message that includes the OSD/SECNAV perspective is provided. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 469
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Distribution: 

Director, Field Support Activity (FSA) 

Department of the Navy Assistant for Administration (DON/AA) 

Chief of Naval Research (OCNR) 

Director, Office of Naval Intelligence (ONI) 

Chief, Bureau of Medicine and Surgery (BUMED) 

Commander, Naval Air Systems Command (NAVAIR) 

Chief, Naval Personnel (CHNAVPERS) 

Commander, Naval Supply Systems Command (NAVSUP) 

Commander, Naval Sea Systems Command (NAVSEA) 

Commander, Naval Facilities Engineering Command (NAVFAC) 

Commandant of the Marine Corps (HQMC) 

Director, Strategic Systems Programs (SSP) 

Commander, Military Sealift Command (MSC) 

Commander, Space and Naval Warfare Systems Command (SPAWAR) 

Director, Naval Systems Management Activity (NSMA) 

Commander, Navy Installations (CNI) 

Commander, U.S. Fleet Forces Command (COMUSFLTFORCOM) 

Commander, U.S. Pacific Fleet (COMPACFLT) 

Commander, Naval Reserve Force (COMNAVRESFOR) 

Commander, Naval Special Warfare Command 

Copy to: 

Immediate Office of the Secretary (ASN(FM&C), ASN(E,I&E), ASN(M&RA), 

ASN(RD&A) only) 

Staff Offices (DON CIO, JAG, and OLA only) 

Chief of Naval Operations (N09, DNS, N093, N095, N097, N1, N2/N6, N3/N5, N4, N8, 

N80, N81, N83, N84, N89, N9, N9I, N95, N96, N97, N98 only) 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 471
472
473
474
475
476
477
DEPARTMENT OF THE NAVY 

HEADQUARTERS UNITED STATES MARINE CORPS 

3000 MARINE CORPS PENTAGON 

WASHINGTON, DC 20380-1775 

From: Commandant of the Marine Corps 

To: My Civilian Marines 

Subj: SEQUESTRATION IMPACTS; POSSIBLE FURLOUGHS 

IN RBPLY RBPBR TO: 

12351 

CL 

1. Civil ian Marines are critical to the Marine Corps' role in 

protecting our Nation . I appreciate that you have already 

sacrificed through a decade of high tempo deployments and combat 

operations. You have remained by our side during nearly three 

years of pay freezes and increasing work. Thank you for all that 

you do and have done for our Corps and country . Unfortunately, I 

may have to ask you to do even more. 

2. As you are aware, there has been much speculation about our 

current fiscal situation. This is my first opportunity to address 

the matter with you. Our Nation's political leaders are working 

hard to resolve these issues. One issue involves what is referred 

to as "sequestration"-or across the board budget reductions-which 

could take effect on March 1, 2013, absent further legislation. 

The President has expressed his intention to exempt military 

personnel funding from these cuts. The law does not, however, 

permit similar civilian funding protections. 

3. There is no shortage of examples of Civilian Marine 

dedication. In the past year, 66 employees crossed the 40 year 

service milestone; another 1,300 employees have 30 years of 

service . One of those with 40 years has been a mainstay at 

Headquarters Marine Corps, faithfully serving through the 9/11 

attacks and the following decade of war. Our civilians are 

interwoven throughout, contributing to our entire organization. 

Our nearl y 450 Family Readiness Officers directl y support the 

operating forces, allowing our operators to focus on the mission 

at hand. A group of 36 Civil ian Marines in the Marine Corps 

Fac i lity Services Directorate are universally recognized for 

enabling operators to conduct realistic training and effectively 

execute their missions. These Civilian Marines typify the 

remarkable performance of over 20,000 Civilian Marines serving our 

Corps. 

4. Every civilian in our organization is important to me, just as 

is every Marine. I want to ensure that all Civilian Marines, as 

well as the Marines and Sailors within our ranks, understand that 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 478
I intend to do my utmost to ensure that the Marine Corps continues 

to accomplish its missions, while keeping faith with you. 

5. The current situation requires tough decisions. With or 

without sequestration, challenging fiscal times lie ahead . In 

addition to our active duty force reductions of 20,000 Marines, I 

anticipate reductions in programs and other areas. The Marine 

Corps, like the rest of our Armed Forces, will have to find ways 

to accomplish missions within reduced budgets. Some form of 

reduction in civilian personnel accounts over the coming year is 

likely unavoidable. As a result, there may be administrative 

furloughs. Potential actions will only occur after a careful 

examination of other viable cost-reduction options. 

6. Our continued success will be built on a team approach, one in 

which everyone involved is kept fully informed to the extent 

possible. Your expertise and insights will add value to the 

effort. While I know that it's difficult, our situation requires 

patience so that we can properly analyze our options. No matter 

what happens, we will work together to minimize any adverse 

impacts on the mission, and reduce as much as possible any adverse 

effects on you and your family. 

7. I greatly appreciate the importance of what our Civilian 

Marines do each and every day, the sacrifices you make on behalf 

of our Nation, and the value you add to our Corps. You have all 

contributed through your service to our organization; 

unfortunately, this situation may require me to ask you to 

sacrifice yet again. We are one Marine Corps family, and we will 

continue as such. Regardless of what may lie ahead, I know that 

as a team we can successfully weather any challenge . In its truest 

sense, I remain ... 

2 

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READINESS AND 

FORCE MANAGEMENT 

OFFICE OF THE ASSISTANT SECRETARY OF DEFENSE 

4000 DEFENSE PENTAGON 

WASHINGTON, D.C. 20301-4000 

MEMORANDUM FOR: SEE DISTRIBUTION FEB 2 1 2013 

SUBJECT: Total Force Management and Budgetary Uncertainty 

Reference: (a) Deputy Secretary of Defense Memorandum, "Handling Budget Uncertainty in Fiscal 

Year 2013", dated 10 January 2013 

(b) Under Secretary of Defense of Personnel & Readiness Memorandum, "Prohibition on 

Converting Certain Functions to Contract Performance", dated I December 2011 

(c) Deputy Secretary of Defense Memorandum, "Guidance for Limitation on Aggregate 

Annual Amount Available for Contracted Services", dated 3 June 2012 

(d) Under Secretary of Defense of Personnel & Readiness Memorandum, "Guidance 

Related to the Utilization of Military Manpower to Perform Certain Functions", dated 

2 March 2012 

(e) DoD Instruction 1100.22, "Guidance for Determining Workforce Mix", dated 12 

April 2010 

This memorandum provides guidance for the management of the Total Force (active and 

reserve military, government civilians, and contracted support) during this time of continued budget 

uncertainty. The Department must maintain the viability of the All-Volunteer Force and sustain its 

operational readiness in the most cost-conscious manner. To do so, the Department must also maintain 

a properly sized, highly capable civilian workforce that is aligned to mission and workload; 

complements and delivers support to the military; supports the well-being ofthe warfighters and their 

families; and recognizes evolving critical demands while guarding against an erosion of organic skills 

and an overreliance on contracted services. Finally, the use of contracted services must continue to be 

reviewed to ensure the most appropriate, cost effective, and efficient support aligned to mission. 

As DoD Components begin to take actions consistent with reference (a) - including the 

implementation of civilian hiring freezes, the release of term or temporary civilian employees, and 

other personnel related actions - they must be mindful ofthe Department's obligations to manage the 

Total Force consistent with Title 10 statutory requirements and references (b) through (e). These 

considerations are required in planning for the potential reduction or unavailability of fiscal year 2013 

funds (with the exception of funds for military personnel) associated with sequester or the continuing 

resolution. 

Consistent with section 2461 of title 10, United States Code, and reference (b), the conversion 

of functions or work performed by, or designated for performance by, civilian employees to contract 

performance without a public-private competition is expressly prohibited. Currently such competitions 

are prohibited under section 325 of the National Defense Authorization Act for Fiscal Year 2010 

(Public Law 111-84). Workload currently performed by, or designated for performance by, civilian 

employees may not be transferred or assumed by contractors performing against prior year obligations. 

Most importantly, contractors may not perform inherently governmental work, and section 2464 of 

title 10, United States Code expressly prohibits contracting of certain functions (enclosure 1). DoD 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 484
Component heads, as well as field commanders and line managers, are urged to be particularly vigilant 

to prevent the inappropriate conversion of work to contract performance. 

Additionally, limits on contracted support spending enacted in section 808 of the National 

Defense Authorization Act for Fiscal Year 2012, Public Law 112-81, and implemented via reference 

(c) still apply. The statutory obligations in section 2330a oftitle 10, United States Code, to minimize 

reliance on contract performance of work closely associated with inherently governmental functions 

(see illustrative examples at enclosure 2) remain in force. Moreover, the guidance in reference (c) to 

achieve reductions of such reliance, as well as in staff augmentation contract support, remains in effect. 

Planning for budgetary uncertainty does not relieve DoD Components from compliance with these 

mandates. 

As we continue planning during this period of budgetary uncertainty, the Department must also 

ensure military personnel are not inappropriately utilized, particularly in a manner that may degrade 

readiness or result in unnecessary costs to the Department. Consistent with references (d) and (e), 

except in extraordinary, and typically temporary, circumstances, individual military personnel or units 

should not perform functions or work that is not military essential (see illustrative examples in 

enclosure 3). The use of "borrowed" or "repurposed" military can harm readiness and operational 

capabilities by diverting service members from training or performance of military essential functions, 

particularly when military members are required to work outside of their occupational specialties. In 

addition to the risk of hollowing the force, this practice could adversely impact the All-Volunteer 

Force and have negative effects on the recruitment, retention, and career progression of individual 

members. During this period of budgetary uncertainty, military units may perform work previously 

performed by civilian employees or contracted support as part of a rotation base for an operational 

capability (if this has been reflected in Operational Orders), provided this is done on a limited and 

temporary basis. In the event of sequestration, where military personnel accounts are exempted, there 

may be instances where military personnel can be used on a short-term, emergency basis to satisfy a 

demand that is of mission critical importance. 

Please ensure maximum distribution of this memorandum throughout your organization, 

particularly to your manpower, personnel, and resourcing communities. Questions regarding 

application and implementation of this memorandum should be addressed to the following points of 

contact within the Office of Total Force Planning & Requirements: Mr. Thomas Hessel 

(thomas.hessel@osd.mil or 703-697-3402), and Ms. Amy Parker (amy.parker@osd.mil or 703-697-

1735). Thank you for your support in the mitigating risks from budgetary uncertainty that could 

adversely affect the sustainability and readiness of the All Volunteer Force. 

Enclosures: As stated 

a.-x j e 

~1/i1/~ 

Frederick Vollrath 

Principal Deputy Assistant Secretary of Defense for 

Readiness and Force Management 

Performing the Duties of the Assistant Secretary of 

Defense for Readiness and Force Management 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 485
DISTRIBUTION: 

SECRETARIES OF THE MILITARY DEPARTMENTS 

CHAIRMAN OF THE JOINT CHIEFS OF STAFF 

UNDER SECRETARIES OF DEFENSE 

DEPUTY CHIEF MANAGEMENT OFFICER 

COMMANDERS OF THE COMBATANT COMMANDS 

DIRECTOR, COST ASSESSMENT AND PROGRAM EVALUATION 

DIRECTOR, OPERATIONAL TEST AND EVALUATION 

GENERAL COUNSEL OF THE DEPARTMENT OF DEFENSE 

INSPECTOR GENERAL OF THE DEPARTMENT OF DEFENSE 

ASSISTANT SECRETARIES OF DEFENSE 

DEPARTMENT OF DEFENSE CHIEF INFORMATION OFFICER 

ASSISTANTS TO THE SECRETARY OF DEFENSE 

DIRECTOR, ADMINISTRATION AND MANAGEMENT 

DIRECTOR, NET ASSESSMENT 

DIRECTORS OF THE DEFENSE AGENCIES 

DIRECTORS OF THE DOD FIELD ACTIVITIES 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 486
Enclosure 1 

Non-Exhaustive Examples of Inherently Governmental Functions 

(Extract from Office of Federal Procurement Policy Letter 11-1 (September 12, 2011) 

 

1. The direct conduct of criminal investigation. 

2. The control of prosecutions and performance of adjudicatory functions (other than those 

relating to arbitration or other methods of alternative dispute resolution). 

3. The command of military forces. 

4. Combat. 

5. Security provided under any of the circumstances set out below. This provision should 

not be interpreted to preclude contractors taking action in self-defense or defense of 

others against the imminent threat of death or serious injury. (a) Security operations 

performed in direct support of combat as part of a larger integrated armed force. (b) 

Security operations performed in environments where, in the judgment of the responsible 

Federal official, there is significant potential for the security operations to evolve into 

combat. (c) Security that entails augmenting or reinforcing others (whether private 

security contractors, civilians, or military units) that have become engaged in combat. 

6. The conduct of foreign relations and the determination of foreign policy. 

7. The determination of agency policy, such as determining the content and application of 

regulations. 

8. The determination of budget policy, guidance, and strategy. 

9. The determination of Federal program priorities or budget requests. 

10. The selection or non-selection of individuals for Federal Government employment, 

including the interviewing of individuals for employment. 

11. The direction and control of Federal employees. 

12. The direction and control of intelligence and counter-intelligence operations. 

13. The approval of position descriptions and performance standards for Federal employees. 

14. The determination of what government property is to be disposed of and on what terms 

(although an agency may give contractors authority to dispose of property at prices with 

specified ranges and subject to other reasonable conditions deemed appropriate by the 

agency). 

15. In Federal procurement activities with respect to prime contracts: 

(a) determining what supplies or services are to be acquired by the government 

(b) participating as a voting member on any source selection boards; 

(c) approving of any contractual documents, including documents defining requirements, 

incentive plans and evaluation criteria; 

(d) determining that prices are fair and reasonable; 

(e) awarding contracts; 

(f) administering contracts (including ordering changers in contact performance or 

contact quantities, making final determinations about a contractor’s performance, 

including approving award fee determinations or past performance evaluations and 

taking action based on those evaluations, and accepting or rejecting contractor 

products or services); 

(g) terminating contracts 

(h) determining whether contact costs are reasonable, allocable, and allowable; 

(i) And participating as a voting member on performance evaluation boards. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 487
Enclosure 1 

16. The selection of grant and cooperative agreement recipients including: (a) approval of 

agreement activities; (b) negotiating the scope of work to be conducted under 

grants/cooperative agreements; (c) approval of modifications to grant/cooperative 

agreement budgets and activities; and (d) performance monitoring. 

17. The approval of agency responses to Freedom of Information Act requests (other than 

routine responses that, because of statute, regulation, or agency policy, do not require the 

exercise of judgment in determining whether documents are to be released or withheld), 

and the approval of agency response to the administrative appeals of denials of Freedom 

of Information Act requests. 

18. The conduct of administrative hearings to determine the eligibility of any person for a 

security clearance, or involving actions that affect matters of personal reputation or 

eligibility to participate in government programs. 

19. The approval of Federal licensing actions and inspections. 

20. The collection, control, and disbursement of fees, royalties, duties, fines, taxes and other 

public funds, unless authorized by statute, such as title 31 Untied States Code section 952 

(relating to private collection contractors) and title 31 United States Code section 3718 

(Relating to private attorney collection services), but not including (a) collection of fees, 

fines, penalties, costs or other charges form visitors to or patrons of mess halls, post or 

base exchange concessions, national parks, and similar entities or activities, or from other 

persons, where the amount to be collected is predetermined or can be readily calculated 

and the funds collected can be readily controlled using standard cash management 

techniques; and (b) routine voucher and invoice examination. 

21. The control of the Treasury accounts. 

22. The administration of public trusts. 

23. The drafting of official agency proposals for legislation, Congressional testimony 

responses to Congressional correspondence, or responses to audit reports from an 

inspector general, the Government Accountability Office, or other Federal audit entity. 

24. Representation of the government before administrative and judicial tribunals, unless 

statute expressly authorizes the use of attorney whose services are procured through 

contract. 

Statutory Restrictions on Contracting 

(Title 10 United States Code Section 2465) 

(a) Except as provided in subsection (b), funds appropriated to Department of Defense may 

not be obligated or expended for the purpose of entering into a contract for the 

performance of fire-fighting or security-guard functions at any military installation or 

facility. 

(b) The prohibition in subsection (a) does not apply to the following contracts: 

(1) A contract to be carried out at a location outside the United States (including its 

commonwealths, territories, and possessions) at which members of the armed forces 

would have to be used for the performance of a function described in subsection (a) at 

the expense of unit readiness. 

(2) (2) A contract to be carried out on a Government-owned but privately operated 

installation. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 488
Enclosure 1 

(3) A contract (or the renewal of a contract) for the performance of a function under 

contract on September 24, 1983. 

(4) A contract for the performance of firefighting functions if the contract is- 

(A) for a period of one year or less; and 

(B) covers only the performance of firefighting functions that, in the absence of 

the contract, would have to be performed by members of the armed forces 

who are not readily available to perform such functions by reason of a 

deployment. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 489
Enclosure 2 

Non-Exhaustive Examples of Closely Associated With Inherently Governmental Functions 

(Extract from Office of Federal Procurement Policy Letter 11-1 (September 12, 2011) 

 

1. Services in support of inherently governmental functions, including, but not limited to the 

following: 

a. Performing budget preparation activities, such as workload modeling, fact 

finding, efficiency studies, and should-cost analysis. 

b. Undertaking activities to support agency planning and reorganization. 

c. Providing support for developing policies, including drafting documents, and 

conducting analyses, feasibility studies, and strategy options. 

d. Providing services to support the development of regulations and legislative 

proposals pursuant to specific policy direction. 

e. Supporting acquisition, including in the areas of: 

i. Acquisition planning, such as by conducting market research; developing 

inputs for government cost estimates, and drafting statements of work and 

other pre-award documents. 

ii. Source selection, such as by preparing a technical evaluation and 

associated documentation; participating as a technical advisor to a source 

selection board or as a nonvoting member of a source selection evaluation 

board; and drafting the price negotiations memorandum. 

iii. Contract management, such as by assisting in the evaluation of a 

contractor’s performance (e.g. by collecting information performing an 

analysis, or making a recommendation for a proposed performance rating), 

and providing support for assessing contract claims and preparing 

termination settlement documents. 

f. Preparation of responses to Freedom of Information Act requests. 

2. Work in a situation that permits or might permit access to confidential business 

information or other sensitive information (other than situations covered by the National 

Industrial Security Program described in Federal Acquisition Regulation 4.402(b)). 

3. Dissemination of information regarding agency policies or regulations, such as 

conducting community relations campaigns, or conducting agency training courses. 

4. Participation in a situation where it might be assumed that participants are agency 

employees or representatives, such as attending conferences on behalf of an agency. 

5. Services as arbitrators or provision of alternative dispute resolution (ADR) services. 

6. Construction of buildings or structures intended to be secure form electronic 

eavesdropping or other penetration by foreign governments. 

7. Provision of inspection services. 

8. Provision of legal advice and interpretations of regulations and statutes to government 

officials. 

9. Provision of non-law enforcement security activities that do not directly involve criminal 

investigations, such as prisoner detention or transport and non-military national security 

details. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 490
Enclosure 3 

Examples of Military Essential Functions 

 (summarized from DoD Instruction 1100.22) 

1. Missions involving operational risks and combatant status under the Law of War. 

2. Specialized collective and individual training requiring military unique knowledge and 

skills based on recent operational experience 

3. Independent advice to senior civilian leadership in Department requiring military unique 

knowledge and skills based on recent operational experience 

4. Command and control arrangements best performed within the Uniform Code of Military 

Justice. 

5. Rotation base for an operational capability. 

6. Career progression. 

7. Esprit de corps (such as military recruiters, military bands) 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 491
THE UNDER SECRETARY OF THE NAVY 

WASHINGTON DC 20350-1000 

FEB 2 1 2013 

MEMORANDUM FOR DISTRIBUTION 

SUBJECT: Planning Guidance for Potential Civilian Furloughs 

References: (a) Letter from Secretary of Defense Leon Panetta to the 

Honorable Joseph R. Biden, Jr., President of the Senate, 

dated 20 February 2013 

(b) DoD Fact Sheet: Year-Long Sequestration and Continuing Resolution 

(c) Secretary of Defense Memorandum for Department of Defense Civilian 

Employees, subject: Preparations for Potential Sequestration on 

1 March 2013 and Furlough Notifications, dated 20 February 2013 

(d) DoD Fact Sheet: Furlough Planning 

1. On 20 February 2013, as required by statute, Secretary of Defense Leon Panetta 

notified the President of the Senate, Speaker of House, and other Congressional leaders 

of the possibility that the Department of Defense may be forced to furlough members of 

its civilian workforce (see reference (a)). These furloughs could result from the 

budgetary impacts of a year-long Continuing Resolution coupled with the across-theboard Federal spending cuts required by the Budget Control Act of 2011, commonly 

referred to as "sequestration" (see reference (b)). 

2. As outlined in reference (c), the Administration is working closely with Congress to 

reach an agreement on a balanced deficit reduction plan that would avoid sequestration. 

In the event these efforts fail, then civilian furloughs could result. To prepare our people 

for this possibility, DoD published some general facts about the mechanics of 

implementing furloughs (see reference (d)). This memorandum provides commanders 

and budget submitting officers with further Department of the Navy (DON) guidance to 

plan for furloughs if they become necessary. 

3. The impact of furloughs on our civilian workforce is not lost on DON leadership, and 

we hope to avert them if possible. However, simple prudence dictates that we plan for 

the worst and prepare our people for the possibility that furloughs may indeed occur. The 

following guidance reflects a consistent DoD-wide approach that will impact the entire 

Department in a similar manner. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 492
SUBJECT: Planning for Potential Civilian Furloughs 

4. If sequestration triggers, all appropriated fund employees, regardless of the funding 

source, would be subject to administrative furlough. Few, if any, exceptions will be 

granted, and any exception must come from one of the following six categories: 

a. Civilians deployed in a combat zone or civilian mariners deployed onboard ships at 

sea (Military Sealift Command ships in a maintenance status overseas are subject to 

furlough of civilian mariners); 

b. Civilians directly responsible for safety of life or property - only to the extent 

needed to prevent unacceptable risk or catastrophic gaps in the safety and protection of 

life or property; 

c. Civilian employees paid with non-appropriated funds; 

d. Employees exempt by law (i.e., employees appointed by the President with the 

advice and consent of the Senate- (PAS)); 

e. Foreign nationals; 

f. All mediCal service civilian employees are subject to furlough except those that 

provide 24-hour inpatient care or emergency service, and personnel providing ancillary 

services directly supporting the 24-hour inpatient care and emergency services. 

5. To prepare for the administrative furlough, all employees will initially be defaulted to 

furlough status. Absent approval from the Assistant Secretary of the Navy 

(Manpower and Reserve Affairs) (ASN (M&RA)) and the Secretary of the Navy, BSO 

Commanders are limited to identifying those civilian employees who meet the stringent 

exception requirements outlined subparagraphs (a) through (f) above. Exceptions 

previously identified during shutdown or emergency (unplanned) events do not apply to 

administrative furlough exceptions - mission critical employees, while still identified as 

such, are not excepted during an administrative (planned) furlough. Any additional DON 

requests for exceptions will be submitted for consideration to the Office of the Secretary 

of Defense (Personnel & Readiness). 

6. Any requests for exceptions must be submitted to the ASN (M&RA) by 27 February 

2013 for consideration and approval by the Secretary of the Navy. Requests for 

exceptions should be submitted via the Director, Office of Civilian Human Resources in 

the format found in enclosure (1). This form will provide us with details on requested 

furlough exemptions as well as an estimate of lost furlough labor savings accompanying 

the requested exemptions. 

2 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 493
SUBJECT: Planning for Potential Civilian Furloughs 

7. All administrative furloughs will be limited to 176 hours, approximately 22 workdays. 

For general planning, furloughs typically will be executed in increments of approximately 

16 hours per pay period to mitigate the impact on the mission and employees. The 

hours/time for the administrative furloughs will be determined by Budget Submitting 

Office (BSO) Commanders and shall be dependent upon mission requirements. Plans to 

deviate from the general planning guidelines will be coordinated with ASN (M&RA) as 

there are potential ramifications to the employees and commands if modified plans are 

adopted. BSO Commanders may delegate the coordination and scheduling of the 

furloughs as appropriate for carrying out the mission requirements. (Note: Scheduling of 

furlough days for employees is subject to local bargaining requirements.) 

8. During the furlough, DON leaders and managers must control leave and absences for 

the military and civilian workforce in order to mitigate the impact of the furlough on 

mission and readiness. Major Commands and the United States Marine Corps may not 

use contract funding or premium pay (e.g., compensatory time or overtime) to offset lost 

time under the furlough. Further, where employees are excepted from the administrative 

furlough, managers may deny paid personal leave if mission requirements are 

jeopardized. 

9. We recognize that over the course of the furlough, DON's civilian. workforce 

capability will be reduced by approximately 20 percent. Our Sailors and Marines will not 

be expected to replace that capacity and services will be negatively impacted. 

Additionally, the DON cannot transfer inherently governmental work to the contractor 

workforce. Finally, our furloughed civilians are prohibited by law from working from 

home or on-site (officially or unofficially) during their furlough days- employees and 

their supervisors will be subject to Anti-Deficiency Act violations and may be subject to 

disciplinary action. 

10. We will continue to work with DoD to mitigate the impacts of the fiscal uncertainty 

on our workforce and our mission. I appreciate your dedication and ongoing service 

against the backdrop of the unprecedented ch nges we face. 

Enclosure: 1. Department of the Navy Civilian Personnel Furlough Exception Request 

Distribution: 

Echelon 1 and 2 Activities 

Budget Submitting Office 

3 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 494
SUBJECT: Department of the Navy Planning for Potential Civilian Furlough 

cc: 

UNSECNAV 

ASN(FM&C) 

OPNA V (VCNO, DNS, Nl, N2/N6, N3/N5, N4, N8, N9) 

ACMC (DMCS, DC M&RA) 

OCHR 

OLA 

CHINFO 

FMBE 

4 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 495
THE SECRETARY OF THE NAVY 

WASHINGTON DC 20350·1 000 

February 22, 2013 

MEMORANDUM FOR DEPARTMENT OF NAVY CIVILIAN EMPLOYEES 

SUBJECT: Potential Sequestration and Possible Furlough 

The Department of the Navy's civilian workforce is an incredibly talented and integral 

part of the Navy and Marine Corps team. Whether you are developing new weaponry for the 

next generation ofwarfighter, helping to operate and maintain our far-flung bases and stations, 

fixing ships or aircraft, pressing forWard on auditability targets, helping Wounded Warriors heal 

and transition, or performing countless other critical tasks, you are vital to our mission. Our 

Sailors and Marines could not have responded to and sustained the brutal operational tempo of 

the last decade of war without the support of each and every one of you. 

Budget pressures have already imposed a pay freeze on the non-uniformed members of 

our team, now in its third year, and most recently, a civilian hiring freeze. Now, unless Congress 

acts, two pending budgetary actions Will force the Department to consider the possibility of 

employee furloughs. The two actions driving these unfortunate circumstances are: 

• Sequestration- the implemerltation of automatic across-the-board budget cuts on 1 

March 2013 to meet the statutory topline limits established in the 2012 Budget Control 

Act; and 

• The possibility that the currel}t Continuing Resolution, which funds U.S. government 

operations only through 27 March 2013, is extended through the end of this fiscal year. 

When taken separately, theseltwo actions are problematic enough; together, they create 

unprecedented and extraordinary budget challenges because the mindless nature of the cuts 

prevents us from managing to a new !budget reality. We remain hopeful an agreement can be 

reached to avoid across-the-board re~uctions, pass a Department of Defense (DoD) 

appropriations bill, and avert this neir fiscal crisis. However, given the great uncertainty we now 

face, simple prudence dictates that 'Wte plan for the worst case scenario-that both occur, and 

with little flexibility to lessen the worst impacts. 

Accordingly, the Departmentiofthe Navy has taken and will continue to take steps to 

reach the savings targets associated With current and projected budget reductions by reducing 

expenditures. However, we cannot fhlly close the looming budget gap with these efforts alone. 

As a result, the Secretary ofDefense:reluctantly sent Congress official notification (as required 

by law) that we may be forced to furlough our civilian employees. Furloughs, if they occur, 

would not begin until mid/late April.! The Congressional notification is only the first step in the 

planning process. Under the worst ch,se scenario, furloughs would affect almost all DoD civilian 

employees and could span 176 hour~ (approximately 22 work days) over the rest of the fiscal 

year. 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 496
SUBJECT: Potential Sequestration and Possible Furlough 

Let me emphasize that furloughing civilian employees is an action of last resort for the 

DoD, and one not taken lightly. We remain hopeful that the need for furloughs will ultimately 

be averted. However, should a Depantment-wide furlough become inevitable, we will 

individually notify personnel as reqlllited at least 30 days in advance of such action. 

The impact ofthe potential futlough is not lost on me or the rest of the Department's 

leadership. We recognize that you arld your families are already being impacted by the fiscal 

uncertainty. We will therefore continue to pursue every option to avoid them. In the meantime, 

we will also continue to communicate with you at every opportunity and at every level to help 

you understand the likelihood and implications of potential furloughs. We will post information 

on a dedicated webpage (links from\fww.donhr.navy.mil). , ' ' 

The days and weeks ahead will be challenging for us all. However, despite the great 

uncertainty facing us, I ask that you riot to lose focus on our mission. We remain at war. Our 

Sailors and Marines depend on each ~ne of you. n·is critical that all of us continue to perform 

our jobs. · 

1 

With great admiration and appreciation for all you do. 

' i 

2 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 497
EXECUTIVE OFFICE OF THE PRESIDENT 

OFFICE OF MANAGEMENT AND BUDGET 

·WASHINGTON, D.C. 20503 

February 27, 2013 

M-13-05 


MEMORANDUMFORTHEHEADSO CUTIVE DEPARTMENTS AND AGENCIES 

FROM: 	 Danny Werfel_,/j 

Controller T 1

SUBJECT: 	 Agency Responsibilities for Implementation of Potential Joint Committee 

Sequestration 

Unless Congress acts to amend current law, the President is required to issue a 

sequestration order on March 1, 2013, canceling $85 billion in budgetary resources across the 

Federal Government. Because these cuts must be achieved over the remaining seven months of 

the fiscal year, the Office ofManagement and Budget (OMB) estimates that the effective 

percentage reductions are approximately 9 percent for nondefense programs and 13 percent for 

defense programs. These reductions will result in significant and harmful impacts to national 

security and domestic priorities. 

The President has been clear that sequestration is bad policy that was never intended to 

be implemented, and the Administration remains hopeful that Congress will act to avoid it 

through an agreement on balanced deficit reduction. However, because legislation may not be 

enacted to avoid sequestration before the current deadline ofMarch 1, 2013, executive 

departments and agencies (agencies) with sequestrable accounts have been engaged in planning 

activities to operate at the lower, post-sequestration funding levels should it be necessary. 

This guidance builds on prior communications with agencies about the implementation of 

sequestration, and addresses questions that have been raised as to certain categories ofplanning 

activities. 

Agency Planning Activities 

OMB Memorandum 13-03, Planningfor Uncertainty with Respect to Fiscal Year 2013 

Budgetary Resources, directed agencies to begin planning activities to operate with reduced 

budgetary resources in the event that sequestration occurs. Agencies' planning efforts must be 

guided by the principle of protecting the agency's mission to serve the public to the greatest 

extent practicable. Planning efforts should be done with sufficient detail and clarity to determine 

the specific actions that will be taken to operate under the lower level of budgetary resources 

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Department of the Navy Administrative Record for FY 2013 Furlough Appeals 498
required by sequestration. For example, agencies should identify any major contracts that they 

plan to cancel, re-scope or delay as well as any grants that they plan to cancel, delay, or for 

which they plan to change the payment amount. Similarly, agencies should identify the number 

of employees who will be furloughed, the length of expected furloughs, the timing of when 

furlough notices will be issued, and the manner in which furloughs will be administered. In 

some cases, agencies may not be able to ascertain all of this information prior to March 1. 

However, agencies should continue to engage in intense and thorough planning activities to 

determine all specific actions that will be taken as soon as practicable. 

Communications 

To the extent permitted by law, agencies should inform their various partners and 

stakeholders in a timely and complete manner ofthe impact of sequestration so that third parties 

are able to adjust their operations and plans as appropriate. Accordingly, at this time, agencies 

should be actively and continuously communicating with affected stakeholders-including 

States, localities, tribal governments, Federal contractors, Federal grant recipients, and Federal 

employees-regarding elements of the agency's planning that have a direct impact on these 

groups. These communications will vary greatly by agency and by stakeholder, but agencies 

should be as specific as possible in order to provide sufficient detail to be helpful to these 

stakeholders in understanding the implications ofthe reduced budget authority resulting from 

sequestration. 

With regard to any planned personnel actions to reduce Federal civilian workforce costs, 

consistent with Section 3(a)(ii) ofExecutive Order 13522, agencies must allow employees' 

exclusive representatives to have pre-decisional involvement in these matters to the fullest extent 

practicable and permitted under the law. In particular, in instances where agencies are 

considering potential furloughs, agencies have a duty to notify their exclusive representatives 

and, upon request, bargain over any negotiable impact and implementation proposals the union 

may submit, unless the matter offurloughs is already covered by a collective bargaining 

agreement. Agencies should ensure that they are fully aware of and in compliance with any and 

all collective bargaining requirements, and should consult with their General Counsel or 

appropriate labor relations office for questions regarding these requirements and appropriate 

interaction with employees and unions on these matters. 

Acquisition 

Due to the Government's large acquisition footprint, sequestration will inevitably affect 

agency contracting activities and require agencies to reduce contracting costs where appropriate. 

As with all actions taken as a result of sequestration, agencies should ensure that any contract 

actions are both cost-effective and minimize negative impact on the agency's mission to the 

extent practicable. 

Program, acquisition, financial/budget management, information technology, and legal 

personnel should work together to make determinations regarding contracts in light of 

sequestration. As a general matter, agencies should only enter into new contracts or exercise 

options when they support high-priority initiatives or where failure to do so would expose the 

2 


Department of the Navy Administrative Record for FY 2013 Furlough Appeals 499
government to significantly greater costs in the future. Agencies may also consider de-scoping or 

terminating for convenience contracts that are no longer affordable within the funds available for 

Fiscal Year 2013, should no other options exist to reduce contracting costs in these instances. 

Should such steps be necessary, agencies must evaluate the associated costs and benefits of such 

actions, and appropriately inform and negotiate with contractors. Finally, agencies should take 

all appropriate steps to minimize to the extent practicable the impact on small businesses of 

reduced contracting activities. 

Financial Assistance 

Given the widespread use of grants, loans and other Federal financial assistance to nonfederal entities (e.g., State, local and tribal governments, non-profit organizations, and 

companies), sequestration will impact the funding of these activities. 

As a general matter, agencies should ensure that any new financial assistance obligations 

or funding increases under existing agreements are consistent with the need to protect the 

agency's mission at the post-sequestration level. In light of sequestration, agencies may also 

consider delaying awarding ofnew financial assistance obligations, reducing levels of continued 

funding, and renegotiating or reducing the current scope of assistance. Agencies may be forced 

to reduce the level of assistance provided through formula funds or block grants. Should any 

such steps be necessary, agencies should evaluate the associated costs and benefits of such 

actions and appropriately engage and inform recipient(s) as early as possible. 

Increased Scrutiny of Certain Activities 

In determining the appropriate manner to achieve funding reductions, agency heads must 

also ensure that their agencies have risk management strategies and internal controls in place that 

provide heightened scrutiny of certain types of activities funded from sequestered accounts. To 

the extent these accounts remain at the post-sequestration funding level, increased scrutiny 

should apply to: 

• 	 hiring new personnel; 1 

• 	 issuing discretionary monetary awards to employees, which should occur only if legally 

required until further notice; and 

• 	 incurring obligations for new training, conferences, and travel (including agency-paid 

travel for non-agency personnel). 

In light of the reduced budgetary resources available due to sequestration, expending 

funds on these activities at this time would in many circumstances not be the most effective way 

to protect agency mission to the extent practicable. Therefore, agency leadership should review 

processes and controls around these activities, and ensure that these activities are conducted only 

1 Agencies must also ensure that appropriate controls are in place to prevent the increased use of contractors 

to perform work due to any restrictions on hiring. Agencies should bear in mind the statutory restrictions 

contained in 10 U.S.C. 2461 and 41 U.S.C. 1710 on the conversion of functions from performance by Federal 

employees to performance by contractors. 

3 


Department of the Navy Administrative Record for FY 2013 Furlough Appeals 500
to the extent they are the most cost-effective way to maintain critical agency mission operations 

under sequestration. 

Please contact your OMB Resource Management Office (RMO) if you have any 

questions about or need assistance with this guidance. 

4 


Department of the Navy Administrative Record for FY 2013 Furlough Appeals 501
THE WHITE HOUSE 

Office of the Press Secretary 

 

For Immediate Release March 1, 2013 

SEQUESTRATION ORDER FOR FISCAL YEAR 2013 PURSUANT 

TO SECTION 251A OF THE BALANCED BUDGET AND 

EMERGENCY DEFICIT CONTROL ACT, AS AMENDED 

 By the authority vested in me as President by the laws 

of the United States of America, and in accordance with 

section 251A of the Balanced Budget and Emergency Deficit 

Control Act, as amended (the "Act"), 2 U.S.C. 901a, I hereby 

order that budgetary resources in each non-exempt budget account 

be reduced by the amount calculated by the Office of Management 

and Budget in its report to the Congress of March 1, 2013. 

Pursuant to sections 250(c)(6), 251A, and 255(e) of the 

Act, budgetary resources subject to sequestration shall be new 

budget authority, unobligated balances of defense function 

accounts carried over from prior fiscal years, direct spending 

authority, and obligation limitations. 

All sequestrations shall be made in strict accordance with 

the requirements of section 251A of the Act and the 

specifications of the Office of Management and Budget's report 

of March 1, 2013, prepared pursuant to section 251A(11) of the 

Act. 

 BARACK OBAMA 

THE WHITE HOUSE, 

 March 1, 2013. 

 # # # 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 502
EXECUTIVE OFFICE OF THE PRESIDENT 

OFFICE OF MANAGEMENT AND BUDGET 

WASHINGTON, D.C. 20503 

March 1, 2013 

M-13-06 

MEMORANDUM FOR THE HEADAVCUTIV DEPARTMENTS AND AGENCIES 

FROM: Jeffrey D. Zient('-\ } 

Deputy Directo Management 

SUBJECT: Issuance ofthe Sequestration Order Pursuant To Section 251A ofthe Balanced 

Budget and Emergency Deficit Control Act of 1985, as Amended 

This memorandum is to inform executive departments and agencies (agencies) that the 

President has issued a sequestration order (order) in accordance with section 251A of the 

Balanced Budget and Emergency Deficit Control Act, as amended (BBEDCA), 2 U.S.C. 901a. 

The order requires that budgetary resources in each non-exempt budget account be reduced by 

the amount calculated by the Office of Management and Budget (OMB) in its report to Congress 

of March 1, 2013, entitled OMB Report to the Congress on the Joint Committee Sequestration 

for Fiscal Year 2013 (sequestration report). 

Due to the failure of the Joint Select Committee on Deficit Reduction, the President was 

required by law to issue an order canceling $85 billion in budgetary resources across the Federal 

Government for the remainder of Fiscal Year (FY) 2013. OMB has calculated that, over the 

course of the fiscal year, the order requires a 7.8 percent reduction in non-exempt defense 

discretionary funding and a 5.0 percent reduction in non-exempt nondefense discretionary 

funding. The sequestration also requires reductions of2.0 percent to Medicare, 5.1 percent to 

other non-exempt nondefense mandatory programs, and 7.9 percent to non-exempt defense 

mandatory programs. The sequestration report provides calculations ofthe amounts and 

percentages by which various budgetary resources are required to be reduced, and a listing of the 

reductions required for each non-exempt budget account. 

Agencies shall apply the same percentage reduction to all programs, projects, and 

activities within a budget account, as required by section 256(k)(2) of BBEDCA, 2 U.S.C. 

906(k)(2). Agencies should operate in a manner that is consistent with guidance provided by 

OMB in Memorandum 13-03, Planningfor Uncertainty with Respect to Fiscal Year 2013 

Budgetary Resources and Memorandum 13-05, Agency Responsibilities for Implementation of 

Potential Joint Committee Sequestration. 

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EXECUTIVE OFFICE OF THE PRESIDENT 


OFFICE OF MANAGEMENT AND BUDGET 


WASHINGTON, D. C . 20503 


March 1, 2013 

The Honorable John A. Boehner 

Speaker ofthe House of Representatives 

Washington, D.C. 20515 

Dear Mr. Speaker: 

Enclosed please find the Office of Management and Budget (OMB) Report to the 

Congress on the sequestration for fiscal year (FY) 2013 required by section 251A of the 

Balanced Budget and Emergency Deficit Control Act, as amended (the "Joint Committee 

sequestration"). This report provides calculations of the amounts and percentages by which 

various budgetary resources are required to be reduced, and a listing of the reductions required 

for each non-exempt budget account. 

In August 2011, as part of the Budget Control Act of2011 (BCA), bipartisan majorities 

in both the House ofRepresentatives and Senate voted for sequestration as a mechanism to 

compel the Congress to act on deficit reduction. The threat of destructive across-the-board cuts 

under the BCA was intended to drive both sides to compromise. Yet, a year and a halfhas 

passed, and the Congress still has failed to enact balanced deficit reduction legislation that avoids 

sequestration. 

As a result of the Congress's failure to act, the law requires the President to issue a 

sequestration order today canceling $85 billion in budgetary resources across the Federal 

Government for FY 2013. Specifically, OMB calculates that, over the course ofthe fiscal year, 

the sequestration requires a 7.8 percent reduction in non-exempt defense discretionary funding 

and a 5.0 percent reduction in non-exempt nondefense discretionary funding. The sequestration 

also requires reductions of 2.0 percent to Medicare, 5.1 percent to other non-exempt nondefense 

mandatory programs, and 7.9 percent to non-exempt defense mandatory programs. 

Because these cuts must be achieved over only seven months instead of 12, the effective 

percentage reductions will be approximately 13 percent for non-exempt defense programs and 9 

percent for non-exempt nondefense programs. 

The cuts required by sequestration will be deeply destructive to national security, 

domestic investments, and core Government functions. While the Department of Defense will 

shift funds where possible to minimize the impact on war-fighting capabilities and critical 

military readiness, sequestration will result in a reduction in readiness of many non-deployed 

units, delays in investments in new equipment, cutbacks in equipment repairs and needed 

facilities maintenance, disruptions in military research and development efforts, significant 

reductions in weapons programs, and furloughs of most civilian employees for a significant 

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amount oftime. Sequestration will also undermine nondefense investments vital to economic 

growth, threaten the safety and security of the American people, and cause severe harm to 

programs that benefit the middle class, seniors, and children. According to analysis by outside 

experts, sequestration would reduce real GDP growth for 2013 by 0.5 to 0.7 percentage points 

were it to continue for the rest ofthe calendar year. 

The Joint Committee sequestration is a blunt and indiscriminate instrument. It was never 

intended to be implemented and does not represent a responsible way for our Nation to achieve 

deficit reduction. 

On multiple occasions, the President has proposed comprehensive and balanced deficit 

reduction plans to avoid sequestration. The President and Congress, working together, have 

already reduced the deficit by $2.5 trillion. The President has been clear that he is willing to 

make tough choices to reach an agreement on further deficit reduction. The Administration 

continues to stand ready to work with the Congress to enact balanced deficit reduction legislation 

that replaces sequestration and puts the Nation on a sound long-term fiscal path. 

Sincerely, 

ey D. Zients 

Deputy Director for Management 

Enclosure 

Identical Letter Sent to the President of the Senate 

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OMB REPORT TO THE CONGRESS 

ON THE JOINT COMMITTEE SEQUESTRATION 

FOR FISCAL YEAR 2013
 

March 1, 2013
 

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OMB REPORT TO THE CONGRESS
 

ON THE JOINT COMMITTEE SEQUESTRATION
 

FOR FISCAL YEAR 2013
 

The Balanced Budget and Emergency Deficit Control Act, as amended (BBEDCA), 2 U.S.C. 

§ 901a, requires the Office of Management and Budget (OMB) to calculate, and the President 

to order on March 1, 2013, reductions in budgetary resources triggered by the failure of the 

Joint Select Committee on Deficit Reduction to propose, and the Congress to enact, legislation 

to reduce the deficit by $1.2 trillion (Joint Committee sequestration). This report provides 

OMB’s calculations of the percentage and dollar amount of the reduction for each non-exempt 

budget account and an explanation of the calculations. 

OMB calculates that the Joint Committee sequestration requires a 7.8 percent reduction 

in non-exempt defense discretionary funding and a 5.0 percent reduction in non-exempt nondefense discretionary funding. The sequestration also imposes reductions of 2.0 percent to 

Medicare, 5.1 percent to other non-exempt nondefense mandatory programs, and 7.9 percent 

to non-exempt defense mandatory programs. 

Basis for Calculations 

Discretionary Appropriations. As of the date of this report, no full-year regular appropriations bills have been enacted for fiscal year (FY) 2013. Instead, all agencies are operating under 

the Continuing Appropriations Resolution, 2013 (CR), Pub. L. 112-175. In addition, the Disaster Relief Appropriations Act, 2013 (Hurricane Sandy supplemental), Pub. L. 113-2, provided 

supplemental funding to various agencies for Hurricane Sandy relief and recovery efforts. Accordingly, as required by sections 251A(7)(A) and 253(f)(2) of BBEDCA, OMB’s estimates for 

the level of sequestrable budgetary resources and resulting reductions assume that budget 

accounts with discretionary appropriations are funded at the annualized level provided by the 

CR, plus funding provided by the Hurricane Sandy supplemental and any funding enacted as 

advance appropriations for FY 2013. Unless another amount is specified by the CR, the annualized level equals the FY 2012 enacted appropriations, including changes in mandatory 

programs, net of any recurring rescissions, and increased by 0.612 percent pursuant to section 

101(c) of the CR.1 Spending authority from offsetting collections is only increased by the 0.612 

percent when that spending authority is used to determine the annualized level. Amounts 

designated in the CR for Overseas Contingency Operations (OCO)/Global War on Terrorism 

(GWOT), and amounts incorporated in the CR by reference to the Disaster Relief Appropriations Act, 2012, Pub. L. 112-77, do not receive the 0.612 percent increase. As provided by section 

101(b) of the CR, whenever an amount designated for OCO/GWOT pursuant to section 251(b) 

(2)(A) of BBEDCA in either the Department of Defense Appropriations Act, 2012 (division A of 

Pub. L. 112-74) or in the Military Construction and Veterans Affairs and Related Agencies Appropriations Act, 2012 (division H of Pub. L. 112-74) differs from the amount in the President’s 

FY 2013 Budget request, the annualized level equals the amount in the President’s FY 2013 

Budget request. The CR levels are also adjusted for any transfers mandated by law. 

Unobligated Balances in the Defense Function. Pursuant to section 255(e) of BBEDCA, unobligated balances in the defense function are sequestrable budgetary resources. The majority 

of estimated unobligated balances in the defense function are in Department of Defense accounts. In general, for multiyear accounts, the Department of Defense estimated unobligated 

balances as of March 1, 2013, by reducing unobligated balances as of December 31, 2012, by a 

historically-based estimate of obligations from prior year funds in January and February. 

Information about OMB’s calculation of the amounts appropriated by the CR can be found in OMB Bulletin 12-02, which 

is available online at http://www.whitehouse.gov/sites/default/files/omb/bulletins/fy2012/b12-02.pdf. 

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Direct Spending. Estimates of sequestrable budgetary resources and outlays for budget 

accounts with direct spending are equal to the current law baseline amounts contained in the 

President’s FY 2013 Budget, adjusted for the effects of legislation enacted since the Budget 

was transmitted. Two changes with the largest effect on the amount of sequestrable direct 

spending—providing for a zero percent update for Medicare payments to physicians under 

the Sustainable Growth Rate formula for calendar year 2013, and extending Emergency Unemployment Compensation (EUC) through the end of 2013—were enacted in the American 

Taxpayer Relief Act of 2012 (ATRA), Pub. L. 112-240. 

Special Sequestration Rules. The Joint Committee sequestration order is not an order 

under section 254 of BBEDCA.2 Accordingly, as set forth in this report, the special rules in 

section 256 that apply only to a sequestration order issued under section 254 do not apply 

to the Joint Committee sequestration, except to the extent those rules are otherwise made 

applicable by another provision of law. Section 251A(7)(A) of BBEDCA does not include any 

such provision for discretionary spending; as a result, in calculating the reduction in discretionary spending required by the Joint Committee sequestration, this report does not apply 

the special rules in section 256 that apply only to a sequestration order issued under section 

254. The special rules in section 256 do, however, apply to the reduction in direct spending 

required by the Joint Committee sequestration, pursuant to the explicit direction in section 

251A(8) of BBEDCA. 

Federal Administrative Expenses. Under section 256(h) of BBEDCA, Federal administrative 

expenses are subject to sequestration pursuant to an order issued under section 254 “without 

regard to any exemption, exception, limitation, or special rule which is otherwise applicable.” 

For the reasons set forth in the preceding paragraph, for the Joint Committee sequestration, 

this rule applies only to Federal administrative expenses that constitute direct spending. 

BBEDCA does not define “administrative expenses.” For purposes of this report, “administrative expenses” for typical Government programs are defined as the object classes for personnel compensation, travel, transportation, communication, equipment, supplies, materials, and 

other services. For Government programs engaging in commercial, business-like activities, 

administrative expenses constitute overhead costs that are necessary to run a business, and 

not expenses that are directly tied to the production and delivery of goods or services. 

American Taxpayer Relief Act of 2012. In addition to the changes to direct spending mentioned above, this report reflects three changes to the calculation of the Joint Committee 

sequestration required by ATRA. Section 901(a) reduced the amount of the FY 2013 sequestration by $24 billion, which was paid for by $12 billion of revenue increases and $12 billion 

in total reductions to the discretionary spending limits for FYs 2013 and 2014. Section 901(c) 

delayed the date for submission of this report from January 2, 2013 to March 1, 2013. Section 

901(e) altered the discretionary spending limits for FY 2013 for purposes of calculating the 

Joint Committee sequestration. 

Calculation of Sequestration Percentages 

Under section 251A of BBEDCA, the failure of the Joint Select Committee on Deficit Reduction to propose, and the Congress to enact, legislation to reduce the deficit by $1.2 trillion 

triggers automatic reductions in discretionary appropriations and direct spending to achieve 

the deficit reduction that the Joint Select Committee process was meant to achieve. As shown 

in Table 1, the total annual amount of deficit reduction required is specified by formula in 

section 251A(3), starting with the total reduction of $1.2 trillion required for FY 2013 through 

For further discussion, see the OMB Report Pursuant to the Sequestration Transparency Act of 2012 (STA Report) issued 

in September. 

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OMB REPORT TO THE CONGRESS ON THE JOINT COMMITTEE SEQUESTRATION FOR FISCAL YEAR 2013 

FY 2021, deducting a specified 18 percent for debt service savings, and then dividing the result by 9 to calculate the annual reduction of $109 billion for each year from FY 2013 to FY 

2021. As discussed previously, ATRA lowered the amount of the reduction required for FY 

2013 by $24 billion, leaving $85 billion to be achieved through sequestration. The annual reduction is split evenly between budget accounts in function 050 (defense function) and in all 

other functions (nondefense function), so that each function group will be reduced by $42.667 

billion in FY 2013. 

Table 1. CalCulaTion of ToTal annual 

ReduCTion by funCTion 

(In billions of dollars) 

Joint Committee required savings ........................................................................................................ 1,200.000 

Deduct debt service savings (18%) ........................................................................................................ –216.000 

Net programmatic reductions ........................................................................................................... 984.000 

Divide by 9 to calculate annual reduction ............................................................................................ 109.333 

Reduction for FY 13 pursuant to section 901(a) of ATRA .................................................................... –24.000 

Net remaining programmatic reduction for FY 2013 ...................................................................... 85.333 

Split 50/50 between defense and nondefense functions ................................................................... 42.667 

Base for Allocating Reductions. The annual reduction is further allocated between discretionary and direct spending within each of the function groups in proportion to their share 

of total spending within the function group. The base for allocating reductions to discretionary appropriations is the discretionary spending limit for FY 2013 listed in section 251(c) 

(2) as revised by section 251A(2)(A), and as applied pursuant to section 901(e) of ATRA. For 

purposes of this report, the discretionary spending limits have not been revised to include 

adjustments pursuant to section 251(b)(2) for certain funding included in the CR and Hurricane Sandy supplemental because these adjustments cannot be made until OMB issues 

its Discretionary Final Sequestration Report for FY 2013 on March 27th pursuant to section 

901(b) of ATRA. Pursuant to paragraphs (5) and (6) of section 251A, and consistent with 

section 6 of the Statutory Pay-As-You-Go Act of 2010, 2 U.S.C. § 935, the base for allocating 

reductions to budget accounts with direct spending is the sum of the direct spending outlays 

in the budget year and the subsequent year that would result from new sequestrable budget 

authority in FY 2013. 

Sequestrable Base. Once the reductions are allocated between discretionary appropriations and direct spending using the bases above, the sequestration percentage for discretionary appropriations is obtained by dividing the discretionary reduction required by the 

discretionary sequestrable base, which is described above in the “Basis for Calculations” section. By statute, the discretionary sequestrable base differs from the base used to allocate 

the reductions between discretionary appropriations and direct spending. For discretionary 

defense programs, the sequestrable base equals total discretionary appropriations (including funding that would trigger cap adjustments), plus unobligated balances and funding financed by fees, minus exemptions. Except for funding for military personnel accounts, most 

discretionary defense funding is sequestrable.3

 For discretionary nondefense programs, the 

sequestrable base equals total discretionary appropriations (including funding that would 

3 Defense sequestrable budgetary resources include non-exempt new budget authority and unobligated balances carried 

over from prior fiscal years. Budgetary resources for military personnel accounts are exempt pursuant to section 255(f) of 

BBEDCA and the July 31, 2012 letter from OMB notifying the Congress of the President’s intent to exempt military personnel 

accounts from sequestration, available at: http://www.whitehouse.gov/sites/default/files/omb/legislative/letters/militarypersonnel-letter-biden.pdf. 

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trigger cap adjustments) and funding financed by fees, adjusted to exclude funding for the 

Department of Veterans Affairs, Pell Grants, and other exempt amounts. For mandatory programs, the sequestrable base is the same as the mandatory base for allocating the reduction. 

Pursuant to sections 251A(8), 255, and 256 of BBEDCA, most mandatory spending is exempt 

from sequestration or, in the case of the Medicare program and certain health programs, is 

subject to a 2 percent limit on sequestration. 

Defense Function Reduction 

Table 2 shows the calculation of the sequestration percentages and dollar reductions required for budget accounts with discretionary appropriations or direct spending within the 

defense function. The calculation involves the following steps: 

Step 1. Pursuant to section 251A(5), the total reduction of $42.667 billion is allocated proportionately between discretionary appropriations and direct spending. The total base is 

the sum of the FY 2013 revised discretionary spending limit for the security category4 

($544 billion) and OMB’s baseline estimates of sequestrable direct spending outlays 

in the defense function in FY 2013 and FY 2014 from new direct spending budget authority in FY 2013 ($0.662 billion). Discretionary appropriations comprise more than 

99 percent of the total base in the defense function. 

Step 2. Total defense function spending must be reduced by $42.667 billion. As required by 

section 251A(5)(A), allocating the reduction based on the ratio of the revised discretionary spending limit to the total base (the sum of the defense discretionary spending 

limit and sequestrable direct spending) yields a $42.615 billion reduction required for 

discretionary appropriations. Under section 251A(5)(B), the remaining $0.052 billion 

is the reduction required for budget accounts with direct spending. 

Step 3. As required by section 251A(7)(A), the discretionary percentage reduction for FY 2013 

is calculated by dividing the discretionary reduction amount calculated in step 2 

($42.615 billion) by the sequestrable budgetary resources ($549.325 billion) for budget accounts with discretionary appropriations in the defense function, which yields 

a 7.8 percent sequestration rate for budget accounts with non-exempt discretionary 

appropriations. A similar calculation is required by section 251A(8) for the sequestration of direct spending. Dividing the direct spending reduction amount ($0.052 

billion) by the sequestrable budgetary resources ($0.662 billion) for budget accounts 

with direct spending yields a 7.9 percent sequestration rate for budget accounts with 

non-exempt direct spending. 

Table 2. defense funCTion ReduCTion 

(Dollars in billions) 

Discretionary Direct Spending Total 

Step 1. Base for allocating reduction ....................... 

Percentage allocation of reductions .............. 

544.000 

99.88% 

0.662 

0.12% 

544.662 

Step 2. Allocation of total reduction ....................... 

Percentage allocation of reductions .............. 

42.615 

99.88% 

0.052 

0.12% 

42.667 

Step 3. Sequestration percentages calculation: 

Sequestrable base ................................... 

Sequestration percentage ........................ 

549.325 

7.8% 

0.662 

7.9% 

For purposes of this report, the “security category” means discretionary appropriations in budget function 050, National 

Defense, and “nonsecurity category” means discretionary appropriations other than in budget function 050. 

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OMB REPORT TO THE CONGRESS ON THE JOINT COMMITTEE SEQUESTRATION FOR FISCAL YEAR 2013 

Nondefense Function Reduction 

Table 3 shows the calculation of the sequestration percentages and dollar reductions required for budget accounts with discretionary appropriations or direct spending within all 

other functions besides 050 (nondefense function). The calculation is more complicated than 

the calculation for the defense function due to a two percent limit on sequestration of Medicare 

non-administrative spending, a two percent limit on sequestration of community and migrant 

health centers (which applies only to mandatory funding for those programs), and a special rule 

for applying the sequestration to student loans. The calculation involves the following steps: 

Step 1. Total spending in the nondefense function must be reduced by $42.667 billion. The 

portion of Medicare subject to the two percent limit is estimated to have combined FY 

2013 and FY 2014 outlays of $567.340 billion5

 from FY 2013 budgetary resources, so 

a two percentage point reduction would reduce outlays by $11.347 billion, leaving a 

reduction of $31.320 billion to be taken from discretionary appropriations and other 

direct spending in the nondefense function. 

Step 2. Pursuant to section 251A(6), the remaining reduction of $31.320 billion is allocated proportionately between discretionary appropriations and other direct spending in the nondefense function. The remaining base ($605.839 billion) is the sum of the FY 2013 revised discretionary spending limit for the nonsecurity category ($499.000 billion) and 

the remaining sequestrable direct spending base ($106.839 billion).6 The latter amount 

equals OMB’s 2013 Budget baseline estimates of total sequestrable direct spending outlays adjusted for legislation enacted since the Budget’s transmittal ($674.179 billion), 

minus the portion of Medicare subject to the two percent limit ($567.340 billion) in the 

nondefense function in FY 2013 and FY 2014 from new direct spending budget authority 

in FY 2013. The discretionary spending limit accounts for 82.37 percent of the remaining 

base in the nondefense function, and direct spending accounts for 17.63 percent. 

Applying these percentage allocations to the non-Medicare reduction required for 

programs in the nondefense function yields the reduction for discretionary appropriations ($25.798 billion) and for remaining direct spending ($5.522 billion). 

Step 3. The sequestration for the mandatory portions of certain health programs is limited 

to two percentage points pursuant to sections 251A(8) and 256(e)(2). The portion of 

these two programs subject to the two percent limit is estimated to have combined 

FY 2013 and FY 2014 outlays of $1.344 billion from FY 2013 budgetary resources, so 

a two percentage point reduction would reduce outlays by $0.027 billion. Deducting 

these savings from the non-Medicare direct spending reduction leaves $5.495 billion 

to be taken by a uniform percentage reduction of the remaining sequestrable direct 

spending of $105.495 billion in the nondefense function. 

Step 4. As required by section 251A(7)(A), dividing the discretionary reduction amount 

($25.798 billion) calculated in step 2 by the sequestrable budgetary resources for 

discretionary appropriations ($511.785 billion) in the nondefense function yields an 

5.0 percent sequestration rate for budget accounts with non-exempt discretionary 

appropriations.7 

5 As stated above, the Medicare base is higher than the amount stated in the STA Report due primarily to provisions in 

ATRA providing for a zero percent update for Medicare payments to physicians under the Sustainable Growth Rate formula for 

calendar year 2013. 

6 As stated above, the non-Medicare direct spending base is higher than the amount stated in the STA Report due primarily 

to a provision in ATRA extending EUC through the end of 2013. 

7 As stated above, the nondefense discretionary base is higher than the amount stated in the STA Report due primarily to 

the Hurricane Sandy supplemental. 

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The remaining reduction ($5.495 billion) to direct spending is applied as a uniform 

percentage reduction to the remaining budget accounts with sequestrable direct 

spending and by increasing student loan fees by the same uniform percentage, as 

specified in sections 251A(8) and 256(b). Each percentage point increase in the sequestration rate is estimated to result in $0.016 billion of savings in the direct student loan program. Solving simultaneously for the percentage that would achieve the 

remaining reduction when applied to both the remaining sequestrable direct spending ($105.495 billion) and to student loan fees yields a 5.1 percent reduction. This 

percentage reduction would yield savings of $0.082 billion in the direct student loan 

program and $5.413 billion from the remaining budget accounts with non-exempt 

direct spending. 

Table 3. nondefense funCTion ReduCTion 

(dollars in billions) 

Direct Discretionary Total Spending 

1. Total reduction, excluding savings from Medicare 2% limit: 

Medicare base subject to 2% limit ................................................... 

Total nondefense function reduction ............................................... 

Reduce Medicare by 2% ................................................................... 

Non-Medicare reduction amounts .............................................. 

2. Allocate non-Medicare reduction: 

567.340 

42.667 

–11.347 

31.320 

Total base for allocating reduction .................................................. 499.000 674.179 1,173.179 

Exclude Medicare (portion subject to 2% limit) .............................. 

Non-Medicare base ..................................................................... 

Percentage allocation of non-Medicare base .............................. 

Non-Medicare reduction amounts ................................................... 

Percentage allocation of non-Medicare reduction .......................... 

3. Savings from 2% limit on sequestration of other health programs* 

Other health programs sequestrable base ...................................... 

Reduce other health programs by 2% ............................................. 

4. Sequestration percentages calculation: 

Remaining reduction amounts ........................................................ 

Savings from uniform percentage reduction: 

From 5.1% increase in student loan fee ..................................... 

From remaining sequestrable budget accounts ........................ 

Sequestrable base for uniform percentage reduction .................... 

Sequestration percentage ................................................................ 

Summary of reductions: 

2% sequestration of Medicare ......................................................... 

2% limit on sequestration of other health programs ..................... 

Student loan fee increase ................................................................ 

Uniform percentage reduction ........................................................ 

Rounding .......................................................................................... 

Total reduction ................................................................................. 

–567.340 –567.340 

499.000 

82.37% 

25.798 

82.37% 

25.798 

25.798 

511.785 

5.0% 

25.589 

0.209 

106.839 

17.63% 

5.522 

17.63% 

1.344 

–0.027 

5.495 

0.082 

5.413 

105.495 

5.1% 

11.347 

0.027 

0.082 

5.380 

.033 

605.839 

31.320 

25.798 16.869 42.667

* Includes funding for community and migrant health centers, and for Indian health services. 

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Reductions by Budget Account (Appendix) 

The Appendix of this report sets forth the percentage and dollar amount of the reductions 

required for each budget account with sequestrable funding. Specifically, the Appendix shows 

the sequestrable budgetary resources in each budget account, the percentage reduction required for each sequestrable budgetary resource, and the resulting reduction. For illustrative 

purposes only, the Appendix shows the application of the same percentage reduction to each 

type of budgetary resource within a budget account. There is no requirement that sequestration be applied equally to each type of budgetary resource within a budget account. Section 

256(k)(2) of BBEDCA requires that sequestration be applied equally at the program, project, 

and activity level within each budget account. 

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APPENDIX: SEQUESTRABLE BASE
 

AND REDUCTIONS BY BUDGET ACCOUNT
 

(Fiscal year 2013; in millions of dollars)
 

Based on sections 251A, 255, and 256 of the Balanced Budget and Emergency
 

Deficit Control Act of 1985 (BBEDCA), as amended
 

Percentages Used: 

7.8 percent – Defense discretionary 

7.9 percent – Defense mandatory 

5.0 percent – Nondefense discretionary 

5.1 percent – Nondefense mandatory 

For illustrative purposes only, the Appendix shows the application of the same percentage reduction to 

each type of budgetary resource within a budget account. Pursuant to section 256(k)(2) of the Balanced 

Budget and Emergency Deficit Control Act of 1985, the sequestration must be applied equally at the 

program, project, and activity level, but need not be applied equally to each type of budgetary resource 

within a budget account. 

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Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Legislative Branch 

Senate 

001-05-0110 Salaries, Officers and Employees 

Nondefense Discretionary Appropriation 177 5.0 9 

001-05-0123 Miscellaneous Items 

Nondefense Discretionary Appropriation 19 5.0 1 

001-05-0126 Secretary of the Senate 

Nondefense Discretionary Appropriation 6 5.0 * 

001-05-0127 Sergeant at Arms and Doorkeeper of the Senate 

Nondefense Discretionary Appropriation 132 5.0 7 

001-05-0128 Inquiries and Investigations 

Nondefense Discretionary Appropriation 132 5.0 7 

001-05-0130 Senators' Official Personnel and Office Expense Account 

Nondefense Discretionary Appropriation 399 5.0 20 

001-05-0185 Office of the Legislative Counsel of the Senate 

Nondefense Discretionary Appropriation 7 5.0 * 

001-05-0188 Congressional Use of Foreign Currency, Senate 

Nondefense Mandatory Appropriation 6 5.1 * 

001-05-9911 Senate Items 

Nondefense Discretionary Appropriation 2 5.0 * 

House of Representatives 

001-10-0400 Salaries and Expenses 

Nondefense Discretionary Appropriation 1,233 5.0 62 

001-10-0488 Congressional Use of Foreign Currency, House of Representatives 

Nondefense Mandatory Appropriation 1 5.1 * 

Joint Items 

001-11-0181 Joint Economic Committee 

Nondefense Discretionary Appropriation 4 5.0 * 

001-11-0186 Joint Congressional Committee on Inaugural Ceremonies of 2013 

Nondefense Discretionary Appropriation 1 5.0 * 

001-11-0190 Office of Congressional Accessibility Services 

Nondefense Discretionary Appropriation 1 5.0 * 

001-11-0425 Office of the Attending Physician 

Nondefense Discretionary Appropriation 3 5.0 * 

001-11-0460 Joint Committee on Taxation 

Nondefense Discretionary Appropriation 10 5.0 1 

Office of Compliance 

001-12-1600 Salaries and Expenses 

Nondefense Discretionary Appropriation 4 5.0 * 

Capitol Police 

001-13-0476 General Expenses 

Nondefense Discretionary Appropriation 63 5.0 3 

001-13-0477 Salaries 

Nondefense Discretionary Appropriation 279 5.0 14 

* denotes $500,000 or less. Page 1 of 70 

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Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Congressional Budget Office 

001-14-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 44 5.0 2 

Architect of the Capitol 

001-15-0100 General Administration 

Nondefense Discretionary Appropriation 102 5.0 5 

001-15-0105 Capitol Building 

Nondefense Discretionary Appropriation 36 5.0 2 

001-15-0108 Capitol Grounds 

Nondefense Discretionary Appropriation 10 5.0 1 

001-15-0123 Senate Office Buildings 

Nondefense Discretionary Appropriation 72 5.0 4 

001-15-0127 House Office Buildings 

Nondefense Discretionary Appropriation 95 5.0 5 

001-15-0133 Capitol Power Plant 

Nondefense Discretionary Appropriation 124 5.0 6 

001-15-0155 Library Buildings and Grounds 

Nondefense Discretionary Appropriation 47 5.0 2 

001-15-0161 Capitol Visitor Center 

Nondefense Discretionary Appropriation 21 5.0 1 

001-15-0171 Capitol Police Buildings and Grounds 

Nondefense Discretionary Appropriation 22 5.0 1 

001-15-1833 House Historic Buildings Revitalization Trust Fund 

Nondefense Discretionary Appropriation 30 5.0 2 

001-15-4518 Judiciary Office Building Development and Operations Fund 

Nondefense Mandatory Borrowing authority 12 5.1 1 

Botanic Garden 

001-18-0200 Botanic Garden 

Nondefense Discretionary Appropriation 12 5.0 1 

Library of Congress 

001-25-0101 Salaries and Expenses, Library of Congress 

Nondefense Discretionary Appropriation 416 5.0 21 

001-25-0102 Copyright Office: Salaries and Expenses 

Nondefense Discretionary Appropriation 16 5.0 1 

001-25-0127 Congressional Research Service: Salaries and Expenses 

Nondefense Discretionary Appropriation 107 5.0 5 

001-25-0141 Books for the Blind and Physically Handicapped: Salaries and Expenses 

Nondefense Discretionary Appropriation 51 5.0 3 

Government Printing Office 

001-30-0201 Office of Superintendent of Documents: Salaries and Expenses 

Nondefense Discretionary Appropriation 35 5.0 2 

001-30-0203 Congressional Printing and Binding 

Nondefense Discretionary Appropriation 91 5.0 5 

* denotes $500,000 or less. Page 2 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 518
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

001-30-4505 Government Printing Office Revolving Fund 

Nondefense Discretionary Appropriation 1 5.0 * 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 2 5.1 * 

Account Total 3 * 

Government Accountability Office 

001-35-0107 Salaries and Expenses 

Nondefense Discretionary Appropriation 514 5.0 26 

United States Tax Court 

001-40-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 51 5.0 3 

Legislative Branch Boards and Commissions 

001-45-1801 Medicaid and CHIP Payment and Access Commission 

Nondefense Discretionary Appropriation 6 5.0 * 

001-45-2973 United States-China Economic and Security Review Commission 

Nondefense Discretionary Appropriation 3 5.0 * 

001-45-2975 Commission on International Religious Freedom 

Nondefense Discretionary Appropriation 3 5.0 * 

001-45-2990 Capital Construction, Dwight D. Eisenhower Memorial Commission 

Nondefense Discretionary Appropriation 31 5.0 2 

001-45-8148 Open World Leadership Center Trust Fund 

Nondefense Discretionary Appropriation 10 5.0 1 

001-45-9911 Other Legislative Branch Boards and Commissions 

Nondefense Discretionary Appropriation 7 5.0 * 

* denotes $500,000 or less. Page 3 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 519
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Judicial Branch 

Supreme Court of the United States 

002-05-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 73 5.0 4 

002-05-0103 Care of the Building and Grounds 

Nondefense Discretionary Appropriation 8 5.0 * 

United States Court of Appeals for the Federal Circuit 

002-07-0510 Salaries and Expenses 

Nondefense Discretionary Appropriation 30 5.0 2 

United States Court of International Trade 

002-15-0400 Salaries and Expenses 

Nondefense Discretionary Appropriation 20 5.0 1 

Courts of Appeals, District Courts, and other Judicial Services 

002-25-0920 Salaries and Expenses 

Nondefense Discretionary Appropriation 4,716 5.0 236 

Nondefense Mandatory Appropriation 65 5.1 3 

Account Total 4,781 239 

002-25-0923 Defender Services 

Nondefense Discretionary Appropriation 1,037 5.0 52 

002-25-0925 Fees of Jurors and Commissioners 

Nondefense Discretionary Appropriation 52 5.0 3 

002-25-0930 Court Security 

Nondefense Discretionary Appropriation 503 5.0 25 

002-25-5100 Judiciary Filing Fees 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 80 5.1 4 

Nondefense Mandatory Appropriation 194 5.1 10 

Account Total 274 14 

002-25-5101 Registry Administration 

Nondefense Mandatory Appropriation 1 5.1 * 

Administrative Office of the United States Courts 

002-26-0927 Salaries and Expenses 

Nondefense Discretionary Appropriation 83 5.0 4 

Federal Judicial Center 

002-30-0928 Salaries and Expenses 

Nondefense Discretionary Appropriation 27 5.0 1 

United States Sentencing Commission 

002-39-0938 Salaries and Expenses 

Nondefense Discretionary Appropriation 17 5.0 1 

* denotes $500,000 or less. Page 4 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 520
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Agriculture 

Office of the Secretary 

005-03-9913 Office of the Secretary 

Nondefense Discretionary Appropriation 16 5.0 1 

Departmental Management 

005-05-0117 Agriculture Buildings and Facilities and Rental Payments 

Nondefense Discretionary Appropriation 232 5.0 12 

005-05-0500 Hazardous Materials Management 

Nondefense Discretionary Appropriation 4 5.0 * 

005-05-9915 Departmental Administration 

Nondefense Discretionary Appropriation 86 5.0 4 

Office of Communications 

005-06-0150 Office of Communications 

Nondefense Discretionary Appropriation 8 5.0 * 

Office of Civil Rights 

005-07-3800 Office of Civil Rights 

Nondefense Discretionary Appropriation 21 5.0 1 

Office of Inspector General 

005-08-0900 Office of Inspector General 

Nondefense Discretionary Appropriation 86 5.0 4 

Office of Chief Economist 

005-09-0123 Office of the Chief Economist 

Nondefense Discretionary Appropriation 11 5.0 1 

Office of the General Counsel 

005-10-2300 Office of the General Counsel 

Nondefense Discretionary Appropriation 40 5.0 2 

National Appeals Division 

005-11-0706 National Appeals Division 

Nondefense Discretionary Appropriation 13 5.0 1 

Economic Research Service 

005-13-1701 Economic Research Service 

Nondefense Discretionary Appropriation 78 5.0 4 

National Agricultural Statistics Service 

005-15-1801 National Agricultural Statistics Service 

Nondefense Discretionary Appropriation 160 5.0 8 

Agricultural Research Service 

005-18-1400 Salaries and Expenses 

Nondefense Discretionary Appropriation 1,102 5.0 55 

005-18-8214 Miscellaneous Contributed Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 2 5.1 * 

National Institute of Food and Agriculture 

* denotes $500,000 or less. Page 5 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 521
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

005-20-0502 Extension Activities 

Nondefense Discretionary Appropriation 478 5.0 24 

Nondefense Mandatory Appropriation 5 5.1 * 

Account Total 483 24 

005-20-1500 Research and Education Activities 

Nondefense Discretionary Appropriation 714 5.0 36 

005-20-1502 Integrated Activities 

Nondefense Discretionary Appropriation 21 5.0 1 

Animal and Plant Health Inspection Service 

005-32-1600 Salaries and Expenses 

Nondefense Discretionary Appropriation 822 5.0 41 

Nondefense Discretionary Spending authority 18 5.0 1 

Nondefense Mandatory Appropriation 266 5.1 14 

Account Total 1,106 56 

005-32-1601 Buildings and Facilities 

Nondefense Discretionary Appropriation 3 5.0 * 

005-32-9971 Miscellaneous Trust Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 1 5.1 * 

Food Safety and Inspection Service 

005-35-3700 Salaries and Expenses 

Nondefense Discretionary Appropriation 1,010 5.0 51 

Nondefense Discretionary Spending authority 45 5.0 2 

Account Total 1,055 53 

005-35-8137 Expenses and Refunds, Inspection and Grading of Farm Products 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 1 5.1 * 

Grain Inspection, Packers and Stockyards Administration 

005-37-2400 Salaries and Expenses 

Nondefense Discretionary Appropriation 38 5.0 2 

005-37-4050 Limitation on Inspection and Weighing Services Expenses 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 1 5.1 * 

Nondefense Mandatory Spending authority 40 5.1 2 

Account Total 41 2 

Agricultural Marketing Service 

005-45-2500 Marketing Services 

Nondefense Discretionary Appropriation 83 5.0 4 

005-45-2501 Payments to States and Possessions 

Nondefense Discretionary Appropriation 1 5.0 * 

005-45-5070 Perishable Agricultural Commodities Act Fund 

Nondefense Mandatory Appropriation 11 5.1 1 

005-45-5209 Funds for Strengthening Markets, Income, and Supply (section 32) 

Nondefense Mandatory Appropriation 792 5.1 40 

005-45-8015 Expenses and Refunds, Inspection and Grading of Farm Products 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 4 5.1 * 

Nondefense Mandatory Appropriation 4 5.1 * 

Account Total 8 * 

005-45-8412 Milk Market Orders Assessment Fund 

Nondefense Mandatory Spending authority 57 5.1 3 

* denotes $500,000 or less. Page 6 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 522
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Risk Management Agency 

005-47-2707 Administrative and Operating Expenses 

Nondefense Discretionary Appropriation 75 5.0 4 

005-47-4085 Federal Crop Insurance Corporation Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 58 5.1 3 

Farm Service Agency 

005-49-0170 State Mediation Grants 

Nondefense Discretionary Appropriation 4 5.0 * 

005-49-0171 Emergency Forest Restoration Program 

Nondefense Discretionary Appropriation 23 5.0 1 

005-49-0600 Salaries and Expenses 

Nondefense Discretionary Appropriation 1,206 5.0 60 

005-49-1140 Agricultural Credit Insurance Fund Program Account 

Nondefense Discretionary Appropriation 408 5.0 20 

005-49-1336 Commodity Credit Corporation Export Loans Program Account 

Nondefense Discretionary Appropriation 7 5.0 * 

005-49-2701 USDA Supplemental Assistance 

Nondefense Discretionary Appropriation 2 5.0 * 

005-49-3304 Grassroots Source Water Protection Program 

Nondefense Discretionary Appropriation 4 5.0 * 

005-49-3305 Reforestation Pilot Program 

Nondefense Discretionary Appropriation 1 5.0 * 

005-49-3316 Emergency Conservation Program 

Nondefense Discretionary Appropriation 15 5.0 1 

005-49-4336 Commodity Credit Corporation Fund 

Nondefense Mandatory Borrowing authority 6,460 5.1 329 

005-49-5531 Agricultural Disaster Relief Fund 

Nondefense Mandatory Borrowing authority 1,372 5.1 70 

005-49-8161 Tobacco Trust Fund 

Nondefense Mandatory Appropriation 960 5.1 49 

Natural Resources Conservation Service 

005-53-1000 Conservation Operations 

Nondefense Discretionary Appropriation 833 5.0 42 

Nondefense Discretionary Spending authority 9 5.0 * 

Account Total 842 42 

005-53-1002 Watershed Rehabilitation Program 

Nondefense Discretionary Appropriation 15 5.0 1 

005-53-1004 Farm Security and Rural Investment Programs 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 108 5.1 6 

Nondefense Mandatory Appropriation 3,249 5.1 166 

Account Total 3,357 171 

005-53-1072 Watershed and Flood Prevention Operations 

Nondefense Discretionary Appropriation 180 5.0 9 

005-53-3320 Water Bank Program 

Nondefense Discretionary Appropriation 8 5.0 * 

Rural Development 

* denotes $500,000 or less. Page 7 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 523
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

005-55-0403 Salaries and Expenses 

Nondefense Discretionary Appropriation 183 5.0 9 

Rural Utilities Service 

005-60-1230 Rural Electrification and Telecommunications Loans Program Account 

Nondefense Discretionary Appropriation 37 5.0 2 

005-60-1232 Distance Learning, Telemedicine, and Broadband Program 

Nondefense Discretionary Appropriation 38 5.0 2 

005-60-1980 Rural Water and Waste Disposal Program Account 

Nondefense Discretionary Appropriation 506 5.0 25 

005-60-2042 High Energy Cost Grants 

Nondefense Discretionary Appropriation 10 5.0 1 

Rural Housing Service 

005-63-0137 Rental Assistance Program 

Nondefense Discretionary Appropriation 910 5.0 46 

005-63-1951 Rural Community Facilities Program Account 

Nondefense Discretionary Appropriation 29 5.0 1 

005-63-1953 Rural Housing Assistance Grants 

Nondefense Discretionary Appropriation 33 5.0 2 

005-63-2002 Multifamily Housing Revitalization Program Account 

Nondefense Discretionary Appropriation 13 5.0 1 

005-63-2006 Mutual and Self-help Housing Grants 

Nondefense Discretionary Appropriation 30 5.0 2 

005-63-2081 Rural Housing Insurance Fund Program Account 

Nondefense Discretionary Appropriation 514 5.0 26 

Rural Business_Cooperative Service 

005-65-1900 Rural Cooperative Development Grants 

Nondefense Discretionary Appropriation 25 5.0 1 

005-65-1902 Rural Business Program Account 

Nondefense Discretionary Appropriation 75 5.0 4 

005-65-1908 Rural Energy for America Program 

Nondefense Discretionary Appropriation 3 5.0 * 

Nondefense Mandatory Appropriation 22 5.1 1 

Account Total 25 1 

005-65-2069 Rural Development Loan Fund Program Account 

Nondefense Discretionary Appropriation 11 5.0 1 

005-65-2073 Energy Assistance Payments 

Nondefense Mandatory Appropriation 65 5.1 3 

Foreign Agricultural Service 

005-68-2277 Public Law 480 Title I Direct Credit and Food for Progress Program Account 

Nondefense Discretionary Appropriation 3 5.0 * 

005-68-2278 Food for Peace Title II Grants 

Nondefense Discretionary Appropriation 1,475 5.0 74 

005-68-2900 Salaries and Expenses 

Nondefense Discretionary Appropriation 177 5.0 9 

Nondefense Mandatory Appropriation 1 5.1 * 

Account Total 178 9 

* denotes $500,000 or less. Page 8 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 524
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

005-68-2903 McGovern-Dole International Food for Education and Child Nutrition Program 

Nondefense Discretionary Appropriation 185 5.0 9 

Food and Nutrition Service 

005-84-3505 Supplemental Nutrition Assistance Program 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 93 5.1 5 

005-84-3507 Commodity Assistance Program 

Nondefense Discretionary Appropriation 73 5.0 4 

Nondefense Mandatory Appropriation 21 5.1 1 

Account Total 94 5 

005-84-3508 Nutrition Programs Administration 

Nondefense Discretionary Appropriation 140 5.0 7 

005-84-3510 Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) 

Nondefense Discretionary Appropriation 6,659 5.0 333 

Nondefense Mandatory Appropriation 1 5.1 * 

Account Total 6,660 333 

005-84-3539 Child Nutrition Programs 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 36 5.1 2 

Nondefense Mandatory Appropriation 13 5.1 1 

Account Total 49 3 

Forest Service 

005-96-1103 Capital Improvement and Maintenance 

Nondefense Discretionary Appropriation 430 5.0 22 

Nondefense Discretionary Spending authority 16 5.0 1 

Account Total 446 22 

005-96-1104 Forest and Rangeland Research 

Nondefense Discretionary Appropriation 298 5.0 15 

Nondefense Discretionary Spending authority 2 5.0 * 

Account Total 300 15 

005-96-1105 State and Private Forestry 

Nondefense Discretionary Appropriation 260 5.0 13 

005-96-1106 National Forest System 

Nondefense Discretionary Appropriation 1,615 5.0 81 

Nondefense Discretionary Spending authority 14 5.0 1 

Account Total 1,629 81 

005-96-1115 Wildland Fire Management 

Nondefense Discretionary Appropriation 2,448 5.0 122 

Nondefense Discretionary Spending authority 53 5.0 3 

Account Total 2,501 125 

005-96-1119 Management of National Forest Lands for Subsistence Uses 

Nondefense Discretionary Appropriation 3 5.0 * 

005-96-4605 Working Capital Fund 

Nondefense Discretionary Spending authority 3 5.0 * 

005-96-5207 Range Betterment Fund 

Nondefense Discretionary Appropriation 3 5.0 * 

005-96-5540 Stewardship Contracting Product Sales 

Nondefense Mandatory Appropriation 8 5.1 * 

* denotes $500,000 or less. Page 9 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 525
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

005-96-9921 Forest Service Permanent Appropriations 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 1 5.1 * 

Nondefense Mandatory Appropriation 646 5.1 33 

Account Total 647 33 

005-96-9923 Land Acquisition 

Nondefense Discretionary Appropriation 74 5.0 4 

Nondefense Mandatory Appropriation 9 5.1 * 

Account Total 83 4 

005-96-9974 Forest Service Trust Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 2 5.1 * 

Nondefense Mandatory Appropriation 77 5.1 4 

Account Total 79 4 

* denotes $500,000 or less. Page 10 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 526
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Commerce 

Departmental Management 

006-05-0120 Salaries and Expenses 

Nondefense Discretionary Appropriation 57 5.0 3 

006-05-0123 HCHB Renovation and Modernization 

Nondefense Discretionary Appropriation 5 5.0 * 

006-05-0126 Office of the Inspector General 

Nondefense Discretionary Appropriation 29 5.0 1 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 30 2 

Economic Development Administration 

006-06-0125 Salaries and Expenses 

Nondefense Discretionary Appropriation 38 5.0 2 

006-06-2050 Economic Development Assistance Programs 

Nondefense Discretionary Appropriation 221 5.0 11 

Bureau of the Census 

006-07-0401 Salaries and Expenses 

Nondefense Discretionary Appropriation 255 5.0 13 

Nondefense Mandatory Appropriation 30 5.1 2 

Account Total 285 14 

006-07-0450 Periodic Censuses and Programs 

Nondefense Discretionary Appropriation 638 5.0 32 

Economic and Statistical Analysis 

006-08-1500 Salaries and Expenses 

Nondefense Discretionary Appropriation 97 5.0 5 

International Trade Administration 

006-25-1250 Operations and Administration 

Nondefense Discretionary Appropriation 458 5.0 23 

006-25-5521 Grants to Manufacturers of Worsted Wool Fabrics 

Nondefense Mandatory Appropriation 5 5.1 * 

Bureau of Industry and Security 

006-30-0300 Operations and Administration 

Defense Discretionary Appropriation 34 7.8 3 

Nondefense Discretionary Appropriation 67 5.0 3 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 102 6 

Minority Business Development Agency 

006-40-0201 Minority Business Development 

Nondefense Discretionary Appropriation 30 5.0 2 

National Oceanic and Atmospheric Administration 

006-48-1450 Operations, Research, and Facilities 

Nondefense Discretionary Appropriation 3,289 5.0 164 

Nondefense Mandatory Spending authority 6 5.1 * 

Account Total 3,295 165 

006-48-1451 Pacific Coastal Salmon Recovery 

Nondefense Discretionary Appropriation 65 5.0 3 

* denotes $500,000 or less. Page 11 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 527
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

006-48-1460 Procurement, Acquisition and Construction 

Nondefense Discretionary Appropriation 2,013 5.0 101 

006-48-1465 Medicare-eligible Retiree Health Fund Contribution, NOAA 

Nondefense Discretionary Appropriation 2 5.0 * 

006-48-4316 Damage Assessment and Restoration Revolving Fund 

Nondefense Mandatory Appropriation 6 5.1 * 

006-48-5139 Promote and Develop Fishery Products and Research Pertaining to American Fisheries 

Nondefense Mandatory Appropriation 16 5.1 1 

006-48-5284 Limited Access System Administration Fund 

Nondefense Mandatory Appropriation 10 5.1 1 

006-48-5362 Environmental Improvement and Restoration Fund 

Nondefense Mandatory Appropriation 1 5.1 * 

U.S. Patent and Trademark Office 

006-51-1006 Salaries and Expenses 

Nondefense Discretionary Spending authority 2,951 5.0 148 

National Institute of Standards and Technology 

006-55-0500 Scientific and Technical Research and Services 

Nondefense Discretionary Appropriation 580 5.0 29 

006-55-0515 Construction of Research Facilities 

Nondefense Discretionary Appropriation 56 5.0 3 

006-55-0525 Industrial Technology Services 

Nondefense Discretionary Appropriation 129 5.0 6 

National Telecommunications and Information Administration 

006-60-0516 State and Local Implementation Fund 

Nondefense Mandatory Borrowing authority 69 5.1 4 

006-60-0550 Salaries and Expenses 

Nondefense Discretionary Appropriation 46 5.0 2 

006-60-8233 Public Safety Trust Fund 

Nondefense Mandatory Borrowing authority 105 5.1 5 

* denotes $500,000 or less. Page 12 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 528
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Defense--Military Programs 

Operation and Maintenance 

007-10-0100 Operation and Maintenance, Defense-wide 

Defense Discretionary Appropriation 38,457 7.8 3,000 

Defense Discretionary Unobligated balance in 050 748 7.8 58 

Account Total 39,205 3,058 

007-10-0104 United States Court of Appeals for the Armed Forces 

Defense Discretionary Appropriation 14 7.8 1 

007-10-0105 Drug Interdiction and Counter-Drug Activities 

Defense Discretionary Appropriation 1,685 7.8 131 

007-10-0107 Office of the Inspector General 

Defense Discretionary Appropriation 360 7.8 28 

Defense Discretionary Unobligated balance in 050 4 7.8 * 

Account Total 364 28 

007-10-0111 Department of Defense Acquisition Workforce Development Fund 

Defense Discretionary Appropriation 107 7.8 8 

Defense Discretionary Unobligated balance in 050 290 7.8 23 

Account Total 397 31 

007-10-0118 Overseas Contingency Operations Transfer Fund 

Defense Discretionary Unobligated balance in 050 10 7.8 1 

007-10-0130 Defense Health Program 

Defense Discretionary Appropriation 33,528 7.8 2,615 

Defense Discretionary Spending authority 971 7.8 76 

Defense Discretionary Unobligated balance in 050 1,503 7.8 117 

Account Total 36,002 2,808 

007-10-0134 Cooperative Threat Reduction Account 

Defense Discretionary Appropriation 511 7.8 40 

Defense Discretionary Unobligated balance in 050 222 7.8 17 

Account Total 733 57 

007-10-0462 Military Intelligence Program Transfer Fund 

Defense Discretionary Appropriation 313 7.8 24 

007-10-0801 Foreign Currency Fluctuations 

Defense Discretionary Unobligated balance in 050 970 7.8 76 

007-10-0810 The Department of Defense Environmental Restoration Accounts 

Defense Discretionary Appropriation 1,198 7.8 93 

Defense Discretionary Unobligated balance in 050 7 7.8 1 

Account Total 1,205 94 

007-10-0811 Environmental Restoration, Formerly Used Defense Sites 

Defense Discretionary Appropriation 328 7.8 26 

007-10-0819 Overseas Humanitarian, Disaster, and Civic Aid 

Defense Discretionary Appropriation 109 7.8 9 

Defense Discretionary Unobligated balance in 050 65 7.8 5 

Account Total 174 14 

007-10-0833 Emergency Response Fund 

Defense Discretionary Unobligated balance in 050 214 7.8 17 

007-10-0838 Support for International Sporting Competitions 

Defense Discretionary Unobligated balance in 050 10 7.8 1 

* denotes $500,000 or less. Page 13 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 529
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

007-10-1106 Operation and Maintenance, Marine Corps 

Defense Discretionary Appropriation 9,643 7.8 752 

007-10-1107 Operation and Maintenance, Marine Corps Reserve 

Defense Discretionary Appropriation 299 7.8 23 

007-10-1804 Operation and Maintenance, Navy 

Defense Discretionary Appropriation 44,274 7.8 3,453 

Defense Discretionary Unobligated balance in 050 15 7.8 1 

Account Total 44,289 3,455 

007-10-1806 Operation and Maintenance, Navy Reserve 

Defense Discretionary Appropriation 1,369 7.8 107 

007-10-2020 Operation and Maintenance, Army 

Defense Discretionary Appropriation 59,336 7.8 4,628 

Defense Discretionary Unobligated balance in 050 84 7.8 7 

Account Total 59,420 4,635 

007-10-2065 Operation and Maintenance, Army National Guard 

Defense Discretionary Appropriation 7,352 7.8 573 

Defense Discretionary Unobligated balance in 050 1 7.8 * 

Account Total 7,353 574 

007-10-2080 Operation and Maintenance, Army Reserve 

Defense Discretionary Appropriation 3,245 7.8 253 

007-10-2091 Afghanistan Security Forces Fund 

Defense Discretionary Appropriation 5,749 7.8 448 

Defense Discretionary Unobligated balance in 050 4,519 7.8 352 

Account Total 10,268 801 

007-10-2096 Afghanistan Infrastructure Fund 

Defense Discretionary Appropriation 400 7.8 31 

Defense Discretionary Unobligated balance in 050 69 7.8 5 

Account Total 469 37 

007-10-3400 Operation and Maintenance, Air Force 

Defense Discretionary Appropriation 44,443 7.8 3,467 

007-10-3740 Operation and Maintenance, Air Force Reserve 

Defense Discretionary Appropriation 3,415 7.8 266 

007-10-3840 Operation and Maintenance, Air National Guard 

Defense Discretionary Appropriation 6,162 7.8 481 

007-10-4965 Emergency Response 

Defense Discretionary Unobligated balance in 050 12 7.8 1 

007-10-5188 Disposal of Department of Defense Real Property 

Defense Discretionary Appropriation 8 7.8 1 

Defense Discretionary Unobligated balance in 050 55 7.8 4 

Account Total 63 5 

007-10-5189 Lease of Department of Defense Real Property 

Defense Discretionary Appropriation 11 7.8 1 

Defense Discretionary Unobligated balance in 050 71 7.8 6 

Account Total 82 6 

007-10-5193 Overseas Military Facility Investment Recovery 

Defense Discretionary Unobligated balance in 050 2 7.8 * 

* denotes $500,000 or less. Page 14 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 530
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

007-10-9922 Miscellaneous Special Funds 

Defense Mandatory Appropriation 8 7.9 1 

Defense Mandatory Unobligated balance in 050 17 7.9 1 

Account Total 25 2 

Procurement 

007-15-0144 Mine Resistant Ambush Protected Vehicle Fund 

Defense Discretionary Unobligated balance in 050 600 7.8 47 

007-15-0300 Procurement, Defense-wide 

Defense Discretionary Appropriation 5,130 7.8 400 

Defense Discretionary Unobligated balance in 050 670 7.8 52 

Account Total 5,800 452 

007-15-0350 National Guard and Reserve Equipment 

Defense Discretionary Unobligated balance in 050 217 7.8 17 

007-15-0360 Defense Production Act Purchases 

Defense Discretionary Appropriation 171 7.8 13 

Defense Discretionary Unobligated balance in 050 151 7.8 12 

Account Total 322 25 

007-15-0380 Coastal Defense Augmentation 

Defense Discretionary Unobligated balance in 050 4 7.8 * 

007-15-0390 Chemical Agents and Munitions Destruction, Defense 

Defense Discretionary Appropriation 1,564 7.8 122 

Defense Discretionary Unobligated balance in 050 2 7.8 * 

Account Total 1,566 122 

007-15-1109 Procurement, Marine Corps 

Defense Discretionary Appropriation 2,376 7.8 185 

Defense Discretionary Unobligated balance in 050 1,180 7.8 92 

Account Total 3,556 277 

007-15-1506 Aircraft Procurement, Navy 

Defense Discretionary Appropriation 17,871 7.8 1,394 

Defense Discretionary Unobligated balance in 050 2,914 7.8 227 

Account Total 20,785 1,621 

007-15-1507 Weapons Procurement, Navy 

Defense Discretionary Appropriation 3,234 7.8 252 

Defense Discretionary Unobligated balance in 050 703 7.8 55 

Account Total 3,937 307 

007-15-1508 Procurement of Ammunition, Navy and Marine Corps 

Defense Discretionary Appropriation 889 7.8 69 

Defense Discretionary Unobligated balance in 050 103 7.8 8 

Account Total 992 77 

007-15-1611 Shipbuilding and Conversion, Navy 

Defense Discretionary Appropriation 15,010 7.8 1,171 

Defense Discretionary Unobligated balance in 050 7,459 7.8 582 

Account Total 22,469 1,753 

007-15-1810 Other Procurement, Navy 

Defense Discretionary Appropriation 6,089 7.8 475 

Defense Discretionary Unobligated balance in 050 1,320 7.8 103 

Account Total 7,409 578 

* denotes $500,000 or less. Page 15 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 531
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

007-15-2031 Aircraft Procurement, Army 

Defense Discretionary Appropriation 5,858 7.8 457 

Defense Discretionary Unobligated balance in 050 1,532 7.8 119 

Account Total 7,390 576 

007-15-2032 Missile Procurement, Army 

Defense Discretionary Appropriation 1,490 7.8 116 

Defense Discretionary Spending authority 15 7.8 1 

Defense Discretionary Unobligated balance in 050 231 7.8 18 

Account Total 1,736 135 

007-15-2033 Procurement of Weapons and Tracked Combat Vehicles, Army 

Defense Discretionary Appropriation 2,079 7.8 162 

Defense Discretionary Spending authority 20 7.8 2 

Defense Discretionary Unobligated balance in 050 751 7.8 59 

Account Total 2,850 222 

007-15-2034 Procurement of Ammunition, Army 

Defense Discretionary Appropriation 2,239 7.8 175 

Defense Discretionary Spending authority 22 7.8 2 

Defense Discretionary Unobligated balance in 050 299 7.8 23 

Account Total 2,560 200 

007-15-2035 Other Procurement, Army 

Defense Discretionary Appropriation 9,548 7.8 745 

Defense Discretionary Spending authority 17 7.8 1 

Defense Discretionary Unobligated balance in 050 3,501 7.8 273 

Account Total 13,066 1,019 

007-15-2093 Joint Improvised Explosive Device Defeat Fund 

Defense Discretionary Appropriation 1,675 7.8 131 

Defense Discretionary Unobligated balance in 050 303 7.8 24 

Account Total 1,978 154 

007-15-3010 Aircraft Procurement, Air Force 

Defense Discretionary Appropriation 13,050 7.8 1,018 

Defense Discretionary Unobligated balance in 050 9,753 7.8 761 

Account Total 22,803 1,779 

007-15-3011 Procurement of Ammunition, Air Force 

Defense Discretionary Appropriation 619 7.8 48 

Defense Discretionary Unobligated balance in 050 112 7.8 9 

Account Total 731 57 

007-15-3020 Missile Procurement, Air Force 

Defense Discretionary Appropriation 5,944 7.8 464 

Defense Discretionary Unobligated balance in 050 640 7.8 50 

Account Total 6,584 514 

007-15-3080 Other Procurement, Air Force 

Defense Discretionary Appropriation 20,271 7.8 1,581 

Defense Discretionary Unobligated balance in 050 442 7.8 34 

Account Total 20,713 1,616 

Research, Development, Test, and Evaluation 

007-20-0400 Research, Development, Test and Evaluation, Defense-wide 

Defense Discretionary Appropriation 19,391 7.8 1,512 

Defense Discretionary Unobligated balance in 050 1,145 7.8 89 

Account Total 20,536 1,602 

* denotes $500,000 or less. Page 16 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 532
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

007-20-0460 Operational Test and Evaluation, Defense 

Defense Discretionary Appropriation 189 7.8 15 

Defense Discretionary Unobligated balance in 050 9 7.8 1 

Account Total 198 15 

007-20-1319 Research, Development, Test and Evaluation, Navy 

Defense Discretionary Appropriation 17,909 7.8 1,397 

Defense Discretionary Unobligated balance in 050 953 7.8 74 

Account Total 18,862 1,471 

007-20-2040 Research, Development, Test and Evaluation, Army 

Defense Discretionary Appropriation 8,814 7.8 687 

Defense Discretionary Unobligated balance in 050 793 7.8 62 

Account Total 9,607 749 

007-20-3600 Research, Development, Test and Evaluation, Air Force 

Defense Discretionary Appropriation 26,695 7.8 2,082 

Defense Discretionary Unobligated balance in 050 1,727 7.8 135 

Account Total 28,422 2,217 

Military Construction 

007-25-0391 Chemical Demilitarization Construction, Defense-wide 

Defense Discretionary Appropriation 75 7.8 6 

Defense Discretionary Unobligated balance in 050 2 7.8 * 

Account Total 77 6 

007-25-0500 Military Construction, Defense-wide 

Defense Discretionary Appropriation 3,321 7.8 259 

Defense Discretionary Unobligated balance in 050 2,493 7.8 194 

Account Total 5,814 454 

007-25-0510 Department of Defense Base Closure Account 1990 

Defense Discretionary Appropriation 326 7.8 25 

007-25-0512 Department of Defense Base Closure Account 2005 

Defense Discretionary Unobligated balance in 050 601 7.8 47 

007-25-0803 Foreign Currency Fluctuations, Construction 

Defense Discretionary Unobligated balance in 050 1 7.8 * 

007-25-0804 North Atlantic Treaty Organization Security Investment Program 

Defense Discretionary Appropriation 250 7.8 20 

Defense Discretionary Unobligated balance in 050 9 7.8 1 

Account Total 259 20 

007-25-1205 Military Construction, Navy and Marine Corps 

Defense Discretionary Appropriation 2,100 7.8 164 

Defense Discretionary Unobligated balance in 050 1,709 7.8 133 

Account Total 3,809 297 

007-25-1235 Military Construction, Navy Reserve 

Defense Discretionary Appropriation 26 7.8 2 

Defense Discretionary Unobligated balance in 050 39 7.8 3 

Account Total 65 5 

007-25-2050 Military Construction, Army 

Defense Discretionary Appropriation 2,925 7.8 228 

Defense Discretionary Unobligated balance in 050 2,300 7.8 179 

Account Total 5,225 408 

* denotes $500,000 or less. Page 17 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 533
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

007-25-2085 Military Construction, Army National Guard 

Defense Discretionary Appropriation 803 7.8 63 

Defense Discretionary Unobligated balance in 050 507 7.8 40 

Account Total 1,310 102 

007-25-2086 Military Construction, Army Reserve 

Defense Discretionary Appropriation 282 7.8 22 

Defense Discretionary Unobligated balance in 050 144 7.8 11 

Account Total 426 33 

007-25-3300 Military Construction, Air Force 

Defense Discretionary Appropriation 1,202 7.8 94 

Defense Discretionary Unobligated balance in 050 732 7.8 57 

Account Total 1,934 151 

007-25-3730 Military Construction, Air Force Reserve 

Defense Discretionary Appropriation 34 7.8 3 

Defense Discretionary Unobligated balance in 050 23 7.8 2 

Account Total 57 5 

007-25-3830 Military Construction, Air National Guard 

Defense Discretionary Appropriation 117 7.8 9 

Defense Discretionary Unobligated balance in 050 124 7.8 10 

Account Total 241 19 

Family Housing 

007-30-0720 Family Housing Construction, Army 

Defense Discretionary Appropriation 178 7.8 14 

Defense Discretionary Unobligated balance in 050 133 7.8 10 

Account Total 311 24 

007-30-0725 Family Housing Operation and Maintenance, Army 

Defense Discretionary Appropriation 496 7.8 39 

007-30-0730 Family Housing Construction, Navy and Marine Corps 

Defense Discretionary Appropriation 102 7.8 8 

Defense Discretionary Unobligated balance in 050 245 7.8 19 

Account Total 347 27 

007-30-0735 Family Housing Operation and Maintenance, Navy and Marine Corps 

Defense Discretionary Appropriation 370 7.8 29 

007-30-0740 Family Housing Construction, Air Force 

Defense Discretionary Appropriation 60 7.8 5 

Defense Discretionary Unobligated balance in 050 290 7.8 23 

Account Total 350 27 

007-30-0745 Family Housing Operation and Maintenance, Air Force 

Defense Discretionary Appropriation 433 7.8 34 

007-30-0765 Family Housing Operation and Maintenance, Defense-Wide 

Defense Discretionary Appropriation 51 7.8 4 

007-30-0834 Department of Defense Family Housing Improvement Fund 

Defense Discretionary Appropriation 2 7.8 * 

Defense Discretionary Unobligated balance in 050 118 7.8 9 

Account Total 120 9 

007-30-4090 Homeowners Assistance Fund 

Defense Discretionary Appropriation 1 7.8 * 

Defense Discretionary Unobligated balance in 050 245 7.8 19 

Account Total 246 19 

Revolving and Management Funds 

* denotes $500,000 or less. Page 18 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 534
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

007-40-4555 National Defense Stockpile Transaction Fund 

Defense Mandatory Spending authority 153 7.9 12 

007-40-4557 National Defense Sealift Fund 

Defense Discretionary Appropriation 1,107 7.8 86 

007-40-493001 Working Capital Fund, Army 

Defense Discretionary Appropriation 145 7.8 11 

007-40-493002 Working Capital Fund, Navy 

Defense Discretionary Appropriation 24 7.8 2 

007-40-493003 Working Capital Fund, Air Force 

Defense Discretionary Appropriation 305 7.8 24 

007-40-493004 Working Capital Fund, Defense Commissary Agency 

Defense Discretionary Appropriation 1,385 7.8 108 

007-40-493005 Working Capital Fund, Defense-Wide 

Defense Discretionary Appropriation 252 7.8 20 

Trust Funds 

007-55-8164 Surcharge Collections, Sales of Commissary Stores, Defense 

Defense Mandatory Administrative expenses in otherwise exempt resources 251 7.9 20 

007-55-9971 Other DOD Trust Funds 

Defense Mandatory Appropriation 26 7.9 2 

Defense Mandatory Unobligated balance in 050 20 7.9 2 

Account Total 46 4 

* denotes $500,000 or less. Page 19 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 535
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Education 

Office of Elementary and Secondary Education 

018-10-0101 Indian Student Education 

Nondefense Discretionary Appropriation 132 5.0 7 

018-10-0102 Impact Aid 

Nondefense Discretionary Appropriation 1,299 5.0 65 

018-10-0203 Supporting Student Success 

Nondefense Discretionary Appropriation 257 5.0 13 

018-10-0900 Accelerating Achievement and Ensuring Equity 

Nondefense Discretionary Advance appropriation 10,841 5.0 542 

Nondefense Discretionary Appropriation 4,931 5.0 247 

Account Total 15,772 789 

018-10-1000 Education Improvement Programs 

Nondefense Discretionary Advance appropriation 1,681 5.0 84 

Nondefense Discretionary Appropriation 2,881 5.0 144 

Account Total 4,562 228 

Office of Innovation and Improvement 

018-12-0204 Innovation and Instructional Teams 

Nondefense Discretionary Appropriation 1,537 5.0 77 

Office of English Language Acquisition 

018-15-1300 English Learner Education 

Nondefense Discretionary Appropriation 737 5.0 37 

Office of Special Education and Rehabilitative Services 

018-20-0300 Special Education 

Nondefense Discretionary Advance appropriation 9,283 5.0 464 

Nondefense Discretionary Appropriation 3,378 5.0 169 

Account Total 12,661 633 

018-20-0301 Rehabilitation Services and Disability Research 

Nondefense Discretionary Appropriation 392 5.0 20 

Nondefense Mandatory Appropriation 3,231 5.1 165 

Account Total 3,623 184 

018-20-0600 American Printing House for the Blind 

Nondefense Discretionary Appropriation 25 5.0 1 

018-20-0601 National Technical Institute for the Deaf 

Nondefense Discretionary Appropriation 66 5.0 3 

018-20-0602 Gallaudet University 

Nondefense Discretionary Appropriation 126 5.0 6 

Office of Vocational and Adult Education 

018-30-0400 Career, Technical and Adult Education 

Nondefense Discretionary Advance appropriation 791 5.0 40 

Nondefense Discretionary Appropriation 952 5.0 48 

Account Total 1,743 87 

Office of Postsecondary Education 

018-40-0201 Higher Education 

Nondefense Discretionary Appropriation 1,881 5.0 94 

Nondefense Mandatory Appropriation 428 5.1 22 

Account Total 2,309 116 

* denotes $500,000 or less. Page 20 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 536
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

018-40-0241 College Housing and Academic Facilities Loans Program Account 

Nondefense Discretionary Appropriation 21 5.0 1 

018-40-0603 Howard University 

Nondefense Discretionary Appropriation 235 5.0 12 

Office of Federal Student Aid 

018-45-0200 Student Financial Assistance 

Nondefense Discretionary Appropriation 1,722 5.0 86 

Nondefense Mandatory Appropriation * 5.1 * 

Account Total 1,722 86 

018-45-0202 Student Aid Administration 

Nondefense Discretionary Appropriation 1,050 5.0 53 

Nondefense Mandatory Appropriation 359 5.1 18 

Account Total 1,409 71 

018-45-0206 Teacher Education Assistance 

Nondefense Mandatory Appropriation 23 5.1 1 

018-45-5557 Student Financial Assistance Debt Collection 

Nondefense Mandatory Appropriation 10 5.1 1 

Institute of Education Sciences 

018-50-1100 Institute of Education Sciences 

Nondefense Discretionary Appropriation 597 5.0 30 

Departmental Management 

018-80-0700 Office for Civil Rights 

Nondefense Discretionary Appropriation 103 5.0 5 

018-80-0800 Program Administration 

Nondefense Discretionary Appropriation 449 5.0 22 

018-80-1400 Office of the Inspector General 

Nondefense Discretionary Appropriation 60 5.0 3 

* denotes $500,000 or less. Page 21 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 537
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Energy 

National Nuclear Security Administration 

019-05-0240 Weapons Activities 

Defense Discretionary Appropriation 7,557 7.8 589 

Defense Discretionary Unobligated balance in 050 188 7.8 15 

Account Total 7,745 604 

019-05-0309 Defense Nuclear Nonproliferation 

Defense Discretionary Appropriation 2,410 7.8 188 

Defense Discretionary Unobligated balance in 050 32 7.8 2 

Account Total 2,442 191 

019-05-0312 Cerro Grande Fire Activities 

Defense Discretionary Unobligated balance in 050 1 7.8 * 

019-05-0313 Office of the Administrator 

Defense Discretionary Appropriation 413 7.8 32 

Defense Discretionary Unobligated balance in 050 3 7.8 * 

Account Total 416 32 

019-05-0314 Naval Reactors 

Defense Discretionary Appropriation 1,087 7.8 85 

Defense Discretionary Unobligated balance in 050 10 7.8 1 

Account Total 1,097 86 

Environmental and Other Defense Activities 

019-10-0243 Other Defense Activities 

Defense Discretionary Appropriation 828 7.8 65 

Defense Discretionary Unobligated balance in 050 16 7.8 1 

Account Total 844 66 

019-10-0244 Defense Nuclear Waste Disposal 

Defense Discretionary Unobligated balance in 050 9 7.8 1 

019-10-0251 Defense Environmental Cleanup 

Defense Discretionary Appropriation 5,034 7.8 393 

Defense Discretionary Spending authority 1 7.8 * 

Defense Discretionary Unobligated balance in 050 14 7.8 1 

Account Total 5,049 394 

Energy Programs 

019-20-0208 Title 17 Innovative Technology Loan Guarantee Program 

Nondefense Discretionary Spending authority 38 5.0 2 

019-20-0212 Federal Energy Regulatory Commission 

Nondefense Discretionary Spending authority 306 5.0 15 

019-20-0213 Fossil Energy Research and Development 

Nondefense Discretionary Appropriation 495 5.0 25 

019-20-0216 Energy Information Administration 

Nondefense Discretionary Appropriation 106 5.0 5 

019-20-0218 Strategic Petroleum Reserve 

Nondefense Discretionary Appropriation 194 5.0 10 

019-20-0219 Naval Petroleum and Oil Shale Reserves 

Nondefense Discretionary Appropriation 15 5.0 1 

019-20-0222 Science 

Nondefense Discretionary Appropriation 4,904 5.0 245 

* denotes $500,000 or less. Page 22 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 538
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

019-20-0315 Non-defense Environmental Cleanup 

Nondefense Discretionary Appropriation 237 5.0 12 

019-20-0318 Electricity Delivery and Energy Reliability 

Defense Discretionary Appropriation 6 7.8 * 

Nondefense Discretionary Appropriation 134 5.0 7 

Account Total 140 7 

019-20-0319 Nuclear Energy 

Nondefense Discretionary Appropriation 771 5.0 39 

019-20-0321 Energy Efficiency and Renewable Energy 

Nondefense Discretionary Appropriation 1,821 5.0 91 

019-20-0322 Advanced Technology Vehicles Manufacturing Loan Program Account 

Nondefense Discretionary Appropriation 6 5.0 * 

019-20-0337 Advanced Research Projects Agency 

Nondefense Discretionary Appropriation 277 5.0 14 

019-20-5105 Payments to States under Federal Power Act 

Nondefense Mandatory Appropriation 3 5.1 * 

019-20-5231 Uranium Enrichment Decontamination and Decommissioning Fund 

Nondefense Discretionary Appropriation 475 5.0 24 

019-20-5369 Northeast Home Heating Oil Reserve 

Nondefense Discretionary Appropriation 10 5.0 1 

019-20-5523 Ultra-deepwater and Unconventional Natural Gas and Other Petroleum Research Fund 

Nondefense Mandatory Appropriation 50 5.1 3 

Power Marketing Administration 

019-50-0303 Operation and Maintenance, Southwestern Power Administration 

Nondefense Discretionary Appropriation 13 5.0 1 

019-50-4045 Bonneville Power Administration Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 115 5.1 6 

019-50-4404 Western Area Power Administration, Borrowing Authority, Recovery Act. 

Nondefense Mandatory Borrowing authority 180 5.1 9 

019-50-5068 Construction, Rehabilitation, Operation and Maintenance, Western Area Power Administration 

Nondefense Discretionary Appropriation 98 5.0 5 

Departmental Administration 

019-60-0228 Departmental Administration 

Nondefense Discretionary Appropriation 131 5.0 7 

019-60-0236 Office of the Inspector General 

Nondefense Discretionary Appropriation 42 5.0 2 

* denotes $500,000 or less. Page 23 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 539
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Health and Human Services 

Food and Drug Administration 

009-10-4309 Revolving Fund for Certification and Other Services 

Nondefense Mandatory Spending authority 8 5.1 * 

009-10-9911 Salaries and Expenses 

Nondefense Discretionary Appropriation 2,521 5.0 126 

Nondefense Discretionary Spending authority 1,328 5.0 66 

Nondefense Mandatory Spending authority 319 5.1 16 

Account Total 4,168 209 

Health Resources and Services Administration 

009-15-0321 Maternal, Infant, and Early Childhood Home Visiting Programs 

Nondefense Mandatory Appropriation 400 5.1 20 

009-15-0340 Health Education Assistance Loans Program Account 

Nondefense Discretionary Appropriation 3 5.0 * 

009-15-0350 Health Resources and Services 

Nondefense Discretionary Appropriation 6,232 5.0 312 

Nondefense Discretionary Spending authority 11 5.0 1 

Nondefense Mandatory Appropriation 498 5.1 25 

Nondefense Mandatory Appropriation 1,352 2.0 27 

Nondefense Mandatory Spending authority 16 5.1 1 

Account Total 8,109 365 

Indian Health Service 

009-17-0390 Indian Health Services 

Nondefense Discretionary Appropriation 3,890 5.0 195 

Nondefense Mandatory Appropriation 150 2.0 3 

Account Total 4,040 198 

009-17-0391 Indian Health Facilities 

Nondefense Discretionary Appropriation 443 5.0 22 

Centers for Disease Control and Prevention 

009-20-0943 CDC-Wide Activities and Program Support 

Nondefense Discretionary Appropriation 5,692 5.0 285 

Nondefense Discretionary Spending authority 3 5.0 * 

Defense Mandatory Appropriation 55 7.9 4 

Defense Mandatory Unobligated balance in 050 2 7.9 * 

Account Total 5,752 289 

009-20-0944 Toxic Substances and Environmental Public Health, Agency for Toxic Substances and Disease Registry 

Nondefense Discretionary Appropriation 77 5.0 4 

009-20-0946 World Trade Center Health Program Fund 

Nondefense Mandatory Appropriation 190 5.1 10 

National Institutes of Health 

009-25-9915 National Institutes of Health 

Nondefense Discretionary Appropriation 30,899 5.0 1,545 

Nondefense Mandatory Appropriation 150 5.1 8 

Account Total 31,049 1,553 

Substance Abuse and Mental Health Services Administration 

009-30-1362 Susbstance Abuse and Mental Health Services Administration 

Nondefense Discretionary Appropriation 3,368 5.0 168 

Centers for Medicare and Medicaid Services 

* denotes $500,000 or less. Page 24 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 540
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

009-38-0115 Affordable Insurance Exchange Grants 

Nondefense Mandatory Appropriation 868 5.1 44 

009-38-0511 Program Management 

Nondefense Discretionary Spending authority 458 5.0 23 

Nondefense Mandatory Appropriation 253 5.1 13 

Nondefense Mandatory Spending authority 72 5.1 4 

Account Total 783 40 

009-38-0516 State Grants and Demonstrations 

Nondefense Mandatory Appropriation 530 5.1 27 

009-38-0524 Consumer Operated and Oriented Plan Program Contingency Fund 

Nondefense Mandatory Appropriation 253 5.1 13 

009-38-8004 Federal Supplementary Medical Insurance Trust Fund 

Nondefense Discretionary Appropriation 3,446 5.0 172 

Nondefense Mandatory Appropriation 128 5.1 7 

Nondefense Mandatory Appropriation 257,533 2.0 5,151 

Account Total 261,107 5,330 

009-38-8005 Federal Hospital Insurance Trust Fund 

Nondefense Discretionary Appropriation 2,194 5.0 110 

Nondefense Mandatory Appropriation 527 5.1 27 

Nondefense Mandatory Appropriation 280,775 2.0 5,616 

Account Total 283,496 5,752 

009-38-8308 Medicare Prescription Drug Account, Federal Supplementary Insurance Trust Fund 

Nondefense Discretionary Appropriation 398 5.0 20 

Nondefense Mandatory Appropriation 5 5.1 * 

Nondefense Mandatory Appropriation 28,391 2.0 568 

Account Total 28,794 588 

009-38-8393 Health Care Fraud and Abuse Control Account 

Nondefense Discretionary Appropriation 312 5.0 16 

Nondefense Mandatory Appropriation 484 5.1 25 

Nondefense Mandatory Appropriation 812 2.0 16 

Account Total 1,608 57 

Administration for Children and Families 

009-70-1501 Payments to States for Child Support Enforcement and Family Support Programs 

Nondefense Mandatory Appropriation 1 5.1 * 

009-70-1502 Low Income Home Energy Assistance 

Nondefense Discretionary Appropriation 3,493 5.0 175 

009-70-1503 Refugee and Entrant Assistance 

Nondefense Discretionary Appropriation 900 5.0 45 

009-70-1512 Supporting Healthy Families and Adolescent Development 

Nondefense Discretionary Appropriation 63 5.0 3 

Nondefense Mandatory Appropriation 485 5.1 25 

Account Total 548 28 

009-70-1515 Payments to States for the Child Care and Development Block Grant 

Nondefense Discretionary Appropriation 2,292 5.0 115 

009-70-1534 Social Services Block Grant 

Nondefense Mandatory Appropriation 2,285 5.1 117 

009-70-1536 Children and Families Services Programs 

Nondefense Discretionary Appropriation 10,069 5.0 503 

* denotes $500,000 or less. Page 25 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 541
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

009-70-1545 Payments for Foster Care and Permanency 

Nondefense Mandatory Administrative expenses in otherwise exempt resources * 5.1 * 

009-70-1552 Temporary Assistance for Needy Families 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 26 5.1 1 

009-70-1553 Children's Research and Technical Assistance 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 10 5.1 1 

Nondefense Mandatory Appropriation 52 5.1 3 

Nondefense Mandatory Spending authority 13 5.1 1 

Account Total 75 4 

Administration for Community Living 

009-75-0142 Aging and Disability Services Programs 

Nondefense Discretionary Appropriation 1,480 5.0 74 

Nondefense Mandatory Appropriation 28 5.1 1 

Account Total 1,508 75 

Departmental Management 

009-90-0116 Prevention and Public Health Fund 

Nondefense Mandatory Appropriation 1,000 5.1 51 

009-90-0117 Pregnancy Assistance Fund 

Nondefense Mandatory Appropriation 25 5.1 1 

009-90-0130 Office of the National Coordinator for Health Information Technology 

Nondefense Discretionary Appropriation 17 5.0 1 

009-90-0135 Office for Civil Rights 

Nondefense Discretionary Appropriation 41 5.0 2 

Nondefense Discretionary Spending authority 6 5.0 * 

Account Total 47 2 

009-90-0140 Public Health and Social Services Emergency Fund 

Nondefense Discretionary Appropriation 767 5.0 38 

009-90-9912 General Departmental Management 

Nondefense Discretionary Appropriation 477 5.0 24 

Program Support Center 

009-91-0170 HHS Accrual Contribution to the Uniformed Services Retiree Health Care Fund 

Nondefense Discretionary Appropriation 29 5.0 1 

009-91-9971 Miscellaneous Trust Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 45 5.1 2 

Office of the Inspector General 

009-92-0128 Office of the Inspector General 

Nondefense Discretionary Appropriation 55 5.0 3 

Nondefense Mandatory Spending authority 12 5.1 1 

Account Total 67 3 

* denotes $500,000 or less. Page 26 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 542
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Homeland Security 

Departmental Management and Operations 

024-10-0100 Departmental Operations 

Nondefense Discretionary Appropriation 479 5.0 24 

024-10-0102 Office of the Chief Information Officer 

Nondefense Discretionary Appropriation 324 5.0 16 

024-10-0115 Analysis and Operations 

Nondefense Discretionary Appropriation 340 5.0 17 

Office of the Inspector General 

024-20-0200 Operating Expenses 

Nondefense Discretionary Appropriation 145 5.0 7 

Citizenship and Immigration Services 

024-30-0300 Citizenship and Immigration Services 

Nondefense Discretionary Appropriation 103 5.0 5 

Nondefense Mandatory Appropriation 2,859 5.1 146 

Account Total 2,962 151 

United States Secret Service 

024-40-0400 Operating Expenses 

Nondefense Discretionary Appropriation 1,670 5.0 84 

024-40-0401 Acquisition, Construction, and Improvements 

Nondefense Discretionary Appropriation 5 5.0 * 

Transportation Security Administration 

024-45-0541 Federal Air Marshals 

Nondefense Discretionary Appropriation 972 5.0 49 

024-45-0550 Aviation Security 

Nondefense Discretionary Appropriation 3,178 5.0 159 

Nondefense Discretionary Spending authority 2,094 5.0 105 

Nondefense Mandatory Appropriation 250 5.1 13 

Account Total 5,522 276 

024-45-0551 Surface Transportation Security 

Nondefense Discretionary Appropriation 136 5.0 7 

024-45-0554 Transportation Security Support 

Nondefense Discretionary Appropriation 1,038 5.0 52 

024-45-0557 Transportation Threat Assessment and Credentialing 

Nondefense Discretionary Appropriation 165 5.0 8 

Nondefense Discretionary Spending authority 75 5.0 4 

Nondefense Mandatory Spending authority 5 5.1 * 

Account Total 245 12 

Federal Law Enforcement Training Center 

024-49-0509 Salaries and expenses 

Nondefense Discretionary Appropriation 240 5.0 12 

Nondefense Discretionary Spending authority 2 5.0 * 

Account Total 242 12 

024-49-0510 Acquisitions, Construction, Improvements and Related Expenses 

Nondefense Discretionary Appropriation 32 5.0 2 

Immigration and Customs Enforcement 

* denotes $500,000 or less. Page 27 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 543
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

024-55-0540 Immigration and Customs Enforcement 

Nondefense Discretionary Appropriation 5,554 5.0 278 

Nondefense Mandatory Appropriation 312 5.1 16 

Account Total 5,866 294 

024-55-0543 Automation Modernization, Immigration and Customs Enforcement 

Nondefense Discretionary Appropriation 12 5.0 1 

Customs and Border Protection 

024-58-0530 Customs and Border Protection 

Nondefense Discretionary Appropriation 8,737 5.0 437 

Nondefense Mandatory Appropriation 1,464 5.1 75 

Account Total 10,201 512 

024-58-0531 Automation Modernization, Customs and Border Protection 

Nondefense Discretionary Appropriation 331 5.0 17 

024-58-0532 Construction, Customs and Border Protection 

Nondefense Discretionary Appropriation 238 5.0 12 

024-58-0533 Border Security Fencing, Infrastructure, and Technology 

Nondefense Discretionary Appropriation 399 5.0 20 

024-58-0544 Air and Marine Interdiction, Operations, Maintenance, and Procurement 

Nondefense Discretionary Appropriation 507 5.0 25 

024-58-5533 Payments to Wool Manufacturers 

Nondefense Mandatory Appropriation 15 5.1 1 

024-58-5543 International Registered Traveler 

Nondefense Discretionary Appropriation 14 5.0 1 

024-58-5595 Electronic System for Travel Authorization 

Nondefense Mandatory Appropriation 46 5.1 2 

024-58-5687 Refunds, Transfers, and Expenses of Operation, Puerto Rico 

Nondefense Mandatory Appropriation 96 5.1 5 

024-58-8789 US Customs Refunds, Transfers and Expenses, Unclaimed and Abandoned Goods 

Nondefense Mandatory Appropriation 4 5.1 * 

United States Coast Guard 

024-60-0610 Operating Expenses 

Defense Discretionary Appropriation 532 7.8 41 

Nondefense Discretionary Appropriation 3,044 5.0 152 

Account Total 3,576 194 

024-60-0611 Environmental Compliance and Restoration 

Nondefense Discretionary Appropriation 14 5.0 1 

024-60-0612 Reserve Training 

Nondefense Discretionary Appropriation 36 5.0 2 

024-60-0613 Acquisition, Construction, and Improvements 

Nondefense Discretionary Appropriation 1,681 5.0 84 

024-60-0615 Research, Development, Test, and Evaluation 

Nondefense Discretionary Appropriation 26 5.0 1 

024-60-8149 Boat Safety 

Nondefense Mandatory Appropriation 116 5.1 6 

024-60-8314 Trust Fund Share of Expenses 

Nondefense Discretionary Appropriation 45 5.0 2 

* denotes $500,000 or less. Page 28 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 544
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

024-60-8349 Maritime Oil Spill Programs 

Nondefense Mandatory Appropriation 101 5.1 5 

National Protection and Programs Directorate 

024-65-0117 Office of Health Affairs 

Nondefense Discretionary Appropriation 168 5.0 8 

024-65-0521 United States Visitor and Immigrant Status Indicator Technology 

Nondefense Discretionary Appropriation 282 5.0 14 

024-65-0565 Infrastructure Protection and Information Security 

Defense Discretionary Appropriation 1,170 7.8 91 

Defense Discretionary Unobligated balance in 050 1 7.8 * 

Account Total 1,171 91 

024-65-0566 National Protection and Programs Directorate 

Nondefense Discretionary Appropriation 50 5.0 3 

Federal Emergency Management Agency 

024-70-0500 Flood Hazard Mapping and Risk Analysis Program 

Nondefense Discretionary Appropriation 99 5.0 5 

024-70-0560 State and Local Programs 

Defense Discretionary Appropriation 50 7.8 4 

Nondefense Discretionary Appropriation 2,251 5.0 113 

Account Total 2,301 117 

024-70-0564 United States Fire Administration and Training 

Nondefense Discretionary Appropriation 44 5.0 2 

024-70-0700 Salaries and Expenses 

Defense Discretionary Appropriation 75 7.8 6 

Nondefense Discretionary Appropriation 917 5.0 46 

Account Total 992 52 

024-70-0702 Disaster Relief 

Nondefense Discretionary Appropriation 18,565 5.0 928 

024-70-0703 Disaster Assistance Direct Loan Program Account 

Nondefense Discretionary Appropriation 300 5.0 15 

024-70-0707 Emergency Food and Shelter 

Nondefense Discretionary Appropriation 121 5.0 6 

024-70-0715 Radiological Emergency Preparedness Program 

Nondefense Discretionary Spending authority 38 5.0 2 

024-70-0716 National Pre-disaster Mitigation Fund 

Nondefense Discretionary Appropriation 36 5.0 2 

024-70-4236 National Flood Insurance Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 66 5.1 3 

Science and Technology 

024-80-0800 Research, Development, Acquisitions and Operations 

Nondefense Discretionary Appropriation 675 5.0 34 

Domestic Nuclear Detection Office 

024-85-0860 Research, Development, and Operations 

Nondefense Discretionary Appropriation 216 5.0 11 

024-85-0861 Management and Administration 

Nondefense Discretionary Appropriation 38 5.0 2 

* denotes $500,000 or less. Page 29 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 545
2 

Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

024-85-0862 Systems Acquisition 

Nondefense Discretionary Appropriation 41 5.0 

* denotes $500,000 or less. Page 30 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 546
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Housing and Urban Development 

Public and Indian Housing Programs 

025-03-0163 Public Housing Operating Fund 

Nondefense Discretionary Appropriation 3,986 5.0 199 

025-03-0223 Indian Housing Loan Guarantee Fund Program Account 

Nondefense Discretionary Appropriation 6 5.0 * 

025-03-0235 Native Hawaiian Housing Block Grant 

Nondefense Discretionary Appropriation 13 5.0 1 

025-03-0302 Tenant Based Rental Assistance 

Nondefense Discretionary Advance appropriation 4,000 5.0 200 

Nondefense Discretionary Appropriation 14,753 5.0 738 

Account Total 18,753 938 

025-03-0303 Project-based Rental Assistance 

Nondefense Discretionary Advance appropriation 400 5.0 20 

Nondefense Discretionary Appropriation 8,995 5.0 450 

Account Total 9,395 470 

025-03-0304 Public Housing Capital Fund 

Nondefense Discretionary Appropriation 1,886 5.0 94 

025-03-0313 Native American Housing Block Grant 

Nondefense Discretionary Appropriation 654 5.0 33 

025-03-0349 Choice Neighborhoods 

Nondefense Discretionary Appropriation 121 5.0 6 

Community Planning and Development 

025-06-0162 Community Development Fund 

Nondefense Discretionary Appropriation 19,308 5.0 965 

025-06-0176 Self-help Homeownership Opportunity Program 

Nondefense Discretionary Appropriation 54 5.0 3 

025-06-0192 Homeless Assistance Grants 

Nondefense Discretionary Appropriation 1,913 5.0 96 

025-06-0198 Community Development Loan Guarantees Program Account 

Nondefense Discretionary Appropriation 6 5.0 * 

025-06-0205 Home Investment Partnership Program 

Nondefense Discretionary Appropriation 1,006 5.0 50 

025-06-0308 Housing Opportunities for Persons with AIDS 

Nondefense Discretionary Appropriation 334 5.0 17 

Housing Programs 

025-09-0156 Housing Counseling Assistance 

Nondefense Discretionary Appropriation 45 5.0 2 

025-09-0183 FHA-mutual Mortgage Insurance Program Account 

Nondefense Discretionary Appropriation 208 5.0 10 

025-09-0237 Housing for Persons with Disabilities 

Nondefense Discretionary Appropriation 166 5.0 8 

025-09-0320 Housing for the Elderly 

Nondefense Discretionary Appropriation 377 5.0 19 

* denotes $500,000 or less. Page 31 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 547
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

025-09-4041 Rental Housing Assistance Fund 

Nondefense Mandatory Spending authority 3 5.1 * 

025-09-4044 Flexible Subsidy Fund 

Nondefense Discretionary Spending authority 21 5.0 1 

025-09-8119 Manufactured Housing Fees Trust Fund 

Nondefense Discretionary Appropriation 7 5.0 * 

Government National Mortgage Association 

025-12-0186 Guarantees of Mortgage-backed Securities Loan Guarantee Program Account 

Nondefense Discretionary Spending authority 20 5.0 1 

Policy Development and Research 

025-28-0108 Research and Technology 

Nondefense Discretionary Appropriation 46 5.0 2 

Fair Housing and Equal Opportunity 

025-29-0144 Fair Housing Activities 

Nondefense Discretionary Appropriation 71 5.0 4 

Office of Lead Hazard Control and Healthy Homes 

025-32-0174 Lead Hazard Reduction 

Nondefense Discretionary Appropriation 121 5.0 6 

Management and Administration 

025-35-0189 Office of Inspector General 

Nondefense Discretionary Appropriation 135 5.0 7 

025-35-0334 Housing Personnel Compensation and Benefits 

Nondefense Discretionary Appropriation 394 5.0 20 

025-35-0335 Administrative Support Offices 

Nondefense Discretionary Appropriation 541 5.0 27 

025-35-0337 Public and Indian Housing Personnel Compensation and Benefits 

Nondefense Discretionary Appropriation 201 5.0 10 

025-35-0338 Community Planning and Development Personnel Compensation and Benefits 

Nondefense Discretionary Appropriation 111 5.0 6 

025-35-0339 Policy Development and Research Personnel Compensation and Benefits 

Nondefense Discretionary Appropriation 22 5.0 1 

025-35-0340 Fair Housing and Equal Opportunity Personnel Compensation and Benefits 

Nondefense Discretionary Appropriation 73 5.0 4 

025-35-0341 Office of Healthy Homes and Lead Hazard Control Personnel Compensation and Benefits 

Nondefense Discretionary Appropriation 7 5.0 * 

025-35-0402 Transformation Initiative 

Nondefense Discretionary Appropriation 50 5.0 3 

025-35-4586 Information Technology Portfolio 

Nondefense Discretionary Appropriation 200 5.0 10 

* denotes $500,000 or less. Page 32 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 548
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of the Interior 

Bureau of Land Management 

010-04-1109 Management of Lands and Resources 

Nondefense Discretionary Appropriation 966 5.0 48 

Nondefense Discretionary Spending authority 75 5.0 4 

Account Total 1,041 52 

010-04-1110 Construction 

Nondefense Discretionary Appropriation 4 5.0 * 

010-04-1116 Oregon and California Grant Lands 

Nondefense Discretionary Appropriation 113 5.0 6 

010-04-4053 Helium Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 16 5.1 1 

010-04-4525 Working Capital Fund 

Nondefense Discretionary Spending authority 9 5.0 * 

010-04-5017 Service Charges, Deposits, and Forfeitures 

Nondefense Discretionary Appropriation 31 5.0 2 

010-04-5033 Land Acquisition 

Nondefense Discretionary Appropriation 22 5.0 1 

010-04-5132 Range Improvements 

Nondefense Mandatory Appropriation 10 5.1 1 

010-04-9921 Miscellaneous Permanent Payment Accounts 

Nondefense Mandatory Appropriation 62 5.1 3 

010-04-9926 Permanent Operating Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 16 5.1 1 

Nondefense Mandatory Appropriation 131 5.1 7 

Account Total 147 8 

010-04-9971 Miscellaneous Trust Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 21 5.1 1 

Bureau of Ocean Energy Management 

010-06-1917 Ocean Energy Management 

Nondefense Discretionary Appropriation 60 5.0 3 

Nondefense Discretionary Spending authority 101 5.0 5 

Account Total 161 8 

Office of Surface Mining Reclamation and Enforcement 

010-08-1801 Regulation and Technology 

Nondefense Discretionary Appropriation 124 5.0 6 

Nondefense Discretionary Spending authority 3 5.0 * 

Account Total 127 6 

010-08-1803 Payments to States in Lieu of Coal Fee Receipts 

Nondefense Mandatory Appropriation 128 5.1 7 

010-08-5015 Abandoned Mine Reclamation Fund 

Nondefense Discretionary Appropriation 28 5.0 1 

Nondefense Mandatory Appropriation 221 5.1 11 

Account Total 249 13 

Bureau of Reclamation 

* denotes $500,000 or less. Page 33 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 549
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

010-10-0680 Water and Related Resources 

Nondefense Discretionary Appropriation 883 5.0 44 

Nondefense Discretionary Spending authority 212 5.0 11 

Nondefense Mandatory Appropriation 1 5.1 * 

Account Total 1,096 55 

010-10-0687 California Bay-Delta Restoration 

Nondefense Discretionary Appropriation 40 5.0 2 

010-10-4079 Lower Colorado River Basin Development Fund 

Nondefense Discretionary Appropriation 6 5.0 * 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 247 5.1 13 

Nondefense Mandatory Spending authority 1 5.1 * 

Account Total 254 13 

010-10-4081 Upper Colorado River Basin Fund 

Nondefense Discretionary Appropriation 11 5.0 1 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 81 5.1 4 

Account Total 92 5 

010-10-4524 Working Capital Fund 

Nondefense Discretionary Spending authority 13 5.0 1 

010-10-5065 Policy and Administration 

Nondefense Discretionary Appropriation 60 5.0 3 

010-10-5173 Central Valley Project Restoration Fund 

Nondefense Discretionary Appropriation 53 5.0 3 

010-10-5656 Colorado River Dam Fund, Boulder Canyon Project 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 16 5.1 1 

010-10-8070 Reclamation Trust Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 2 5.1 * 

Central Utah Project 

010-11-0787 Central Utah Project Completion Account 

Nondefense Discretionary Appropriation 27 5.0 1 

010-11-5174 Utah Reclamation Mitigation and Conservation Account 

Nondefense Discretionary Appropriation 2 5.0 * 

United States Geological Survey 

010-12-0804 Surveys, Investigations, and Research 

Nondefense Discretionary Appropriation 1,075 5.0 54 

United States Fish and Wildlife Service 

010-18-1611 Resource Management 

Nondefense Discretionary Appropriation 1,234 5.0 62 

Nondefense Discretionary Spending authority 55 5.0 3 

Account Total 1,289 64 

010-18-1612 Construction 

Nondefense Discretionary Appropriation 91 5.0 5 

010-18-1652 Multinational Species Conservation Fund 

Nondefense Discretionary Appropriation 10 5.0 1 

010-18-1696 Neotropical Migratory Bird Conservation 

Nondefense Discretionary Appropriation 4 5.0 * 

010-18-5020 Land Acquisition 

Nondefense Discretionary Appropriation 55 5.0 3 

* denotes $500,000 or less. Page 34 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 550
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

010-18-5029 Federal Aid in Wildlife Restoration 

Nondefense Mandatory Appropriation 413 5.1 21 

010-18-5091 National Wildlife Refuge Fund 

Nondefense Discretionary Appropriation 14 5.0 1 

Nondefense Mandatory Appropriation 8 5.1 * 

Account Total 22 1 

010-18-5137 Migratory Bird Conservation Account 

Nondefense Mandatory Appropriation 47 5.1 2 

010-18-5143 Cooperative Endangered Species Conservation Fund 

Nondefense Discretionary Appropriation 48 5.0 2 

010-18-5241 North American Wetlands Conservation Fund 

Nondefense Discretionary Appropriation 36 5.0 2 

Nondefense Mandatory Appropriation 1 5.1 * 

Account Total 37 2 

010-18-5252 Recreation Enhancement Fee Program, FWS 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 1 5.1 * 

010-18-5474 State Wildlife Grants 

Nondefense Discretionary Appropriation 62 5.0 3 

010-18-8151 Sport Fish Restoration 

Nondefense Mandatory Appropriation 446 5.1 23 

Bureau of Safety and Environmental Enforcement 

010-22-1700 Offshore Safety and Environmental Enforcement 

Nondefense Discretionary Appropriation 62 5.0 3 

Nondefense Discretionary Spending authority 121 5.0 6 

Account Total 183 9 

010-22-1920 Oil Spill Research 

Nondefense Discretionary Appropriation 3 5.0 * 

010-22-8370 Oil Spill Research 

Nondefense Discretionary Appropriation 15 5.0 1 

National Park Service 

010-24-1036 Operation of the National Park System 

Nondefense Discretionary Appropriation 2,250 5.0 113 

010-24-1039 Construction (and Major Maintenance) 

Nondefense Discretionary Appropriation 505 5.0 25 

010-24-1042 National Recreation and Preservation 

Nondefense Discretionary Appropriation 60 5.0 3 

010-24-5035 Land Acquisition and State Assistance 

Nondefense Discretionary Appropriation 103 5.0 5 

010-24-5140 Historic Preservation Fund 

Nondefense Discretionary Appropriation 106 5.0 5 

010-24-9924 Other Permanent Appropriations 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 8 5.1 * 

010-24-9928 Recreation Fee Permanent Appropriations 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 34 5.1 2 

Nondefense Mandatory Appropriation 1 5.1 * 

Account Total 35 2 

Bureau of Indian Affairs and Bureau of Indian Education 

* denotes $500,000 or less. Page 35 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 551
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

010-76-2100 Operation of Indian Programs 

Nondefense Discretionary Appropriation 2,382 5.0 119 

010-76-2301 Construction 

Nondefense Discretionary Appropriation 124 5.0 6 

010-76-2628 Indian Guaranteed Loan Program Account 

Nondefense Discretionary Appropriation 7 5.0 * 

010-76-5051 Operation and Maintenance of Quarters 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 3 5.1 * 

010-76-9925 Miscellaneous Permanent Appropriations 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 19 5.1 1 

Departmental Offices 

010-84-0102 Salaries and Expenses 

Nondefense Discretionary Appropriation 624 5.0 31 

010-84-5003 Mineral Leasing and Associated Payments 

Nondefense Mandatory Appropriation 2,144 5.1 109 

010-84-5045 National Petroleum Reserve, Alaska 

Nondefense Mandatory Appropriation 3 5.1 * 

010-84-5243 National Forests Fund, Payment to States 

Nondefense Mandatory Appropriation 9 5.1 * 

010-84-5248 Leases of Lands Acquired for Flood Control, Navigation, and Allied Purposes 

Nondefense Mandatory Appropriation 19 5.1 1 

010-84-5574 Geothermal Lease Revenues, Payment to Counties 

Nondefense Mandatory Appropriation 4 5.1 * 

Insular Affairs 

010-85-0412 Assistance to Territories 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 10 5.1 1 

Office of the Solicitor 

010-86-0107 Salaries and Expenses 

Nondefense Discretionary Appropriation 67 5.0 3 

Office of Inspector General 

010-88-0104 Salaries and Expenses 

Nondefense Discretionary Appropriation 50 5.0 3 

Office of the Special Trustee for American Indians 

010-90-0120 Federal Trust Programs 

Nondefense Discretionary Appropriation 153 5.0 8 

National Indian Gaming Commission 

010-92-0118 Salaries and Expenses 

Nondefense Discretionary Spending authority 3 5.0 * 

010-92-5141 National Indian Gaming Commission, Gaming Activity Fees 

Nondefense Mandatory Appropriation 18 5.1 1 

Department-Wide Programs 

010-95-1114 Payments in Lieu of Taxes 

Nondefense Mandatory Appropriation 398 5.1 20 

010-95-1121 Central Hazardous Materials Fund 

Nondefense Discretionary Appropriation 10 5.0 1 

* denotes $500,000 or less. Page 36 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 552
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

010-95-1125 Wildland Fire Management 

Nondefense Discretionary Appropriation 750 5.0 38 

010-95-1618 Natural Resource Damage Assessment Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 4 5.1 * 

010-95-4523 Working Capital Fund 

Nondefense Discretionary Appropriation 62 5.0 3 

Nondefense Discretionary Spending authority 12 5.0 1 

Account Total 74 4 

* denotes $500,000 or less. Page 37 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 553
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Justice 

General Administration 

011-03-0129 Salaries and Expenses 

Nondefense Discretionary Appropriation 112 5.0 6 

011-03-0132 Tactical Law Enforcement Wireless Communications 

Nondefense Discretionary Appropriation 88 5.0 4 

011-03-0134 Justice Information Sharing Technology 

Nondefense Discretionary Appropriation 44 5.0 2 

011-03-0136 Detention Trustee 

Nondefense Discretionary Appropriation 1,590 5.0 80 

011-03-0328 Office of Inspector General 

Nondefense Discretionary Appropriation 85 5.0 4 

011-03-0339 Administrative Review and Appeals 

Nondefense Discretionary Appropriation 307 5.0 15 

011-03-1102 National Drug Intelligence Center 

Nondefense Discretionary Appropriation 20 5.0 1 

United States Parole Commission 

011-04-1061 Salaries and Expenses 

Nondefense Discretionary Appropriation 13 5.0 1 

Legal Activities and U.S. Marshals 

011-05-0100 Salaries and Expenses, Foreign Claims Settlement Commission 

Nondefense Discretionary Appropriation 2 5.0 * 

011-05-0128 Salaries and Expenses, General Legal Activities 

Nondefense Discretionary Appropriation 868 5.0 43 

011-05-0133 Construction 

Nondefense Discretionary Appropriation 15 5.0 1 

011-05-0311 Fees and Expenses of Witnesses 

Nondefense Mandatory Appropriation 270 5.1 14 

011-05-0319 Salaries and Expenses, Antitrust Division 

Nondefense Discretionary Appropriation 43 5.0 2 

011-05-0322 Salaries and Expenses, United States Attorneys 

Nondefense Discretionary Appropriation 1,972 5.0 99 

011-05-0324 Salaries and Expenses, United States Marshals Service 

Nondefense Discretionary Appropriation 1,179 5.0 59 

011-05-0340 September 11th Victim Compensation (general Fund) 

Nondefense Mandatory Appropriation 322 5.1 16 

011-05-0500 Salaries and Expenses, Community Relations Service 

Nondefense Discretionary Appropriation 11 5.0 1 

011-05-5042 Assets Forfeiture Fund 

Nondefense Discretionary Appropriation 21 5.0 1 

Nondefense Mandatory Appropriation 1,358 5.1 69 

Account Total 1,379 70 

011-05-5073 United States Trustee System Fund 

Nondefense Discretionary Appropriation 224 5.0 11 

Interagency Law Enforcement 

* denotes $500,000 or less. Page 38 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 554
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

011-07-0323 Interagency Crime and Drug Enforcement 

Nondefense Discretionary Appropriation 531 5.0 27 

National Security Division 

011-08-1300 Salaries and Expenses 

Nondefense Discretionary Appropriation 88 5.0 4 

Federal Bureau of Investigation 

011-10-0200 Salaries and Expenses 

Defense Discretionary Appropriation 4,775 7.8 372 

Defense Discretionary Unobligated balance in 050 169 7.8 13 

Nondefense Discretionary Appropriation 3,321 5.0 166 

Account Total 8,265 552 

011-10-0203 Construction 

Nondefense Discretionary Appropriation 81 5.0 4 

Drug Enforcement Administration 

011-12-1100 Salaries and Expenses 

Nondefense Discretionary Appropriation 2,041 5.0 102 

011-12-1101 Construction 

Nondefense Discretionary Appropriation 10 5.0 1 

011-12-5131 Diversion Control Fee Account 

Nondefense Mandatory Appropriation 335 5.1 17 

Bureau of Alcohol, Tobacco, Firearms, and Explosives 

011-14-0700 Salaries and Expenses 

Nondefense Discretionary Appropriation 1,159 5.0 58 

Federal Prison System 

011-20-1003 Buildings and Facilities 

Nondefense Discretionary Appropriation 55 5.0 3 

011-20-1060 Salaries and Expenses 

Nondefense Discretionary Appropriation 6,591 5.0 330 

011-20-8408 Commissary Funds, Federal Prisons (trust Revolving Fund) 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 111 5.1 6 

Office of Justice Programs 

011-21-0401 Research, Evaluation, and Statistics 

Nondefense Discretionary Appropriation 105 5.0 5 

011-21-0404 State and Local Law Enforcement Assistance 

Nondefense Discretionary Appropriation 1,126 5.0 56 

011-21-0405 Juvenile Justice Programs 

Nondefense Discretionary Appropriation 255 5.0 13 

011-21-0406 Community Oriented Policing Services 

Nondefense Discretionary Appropriation 163 5.0 8 

011-21-0409 Violence against Women Prevention and Prosecution Programs 

Nondefense Discretionary Appropriation 400 5.0 20 

011-21-5041 Crime Victims Fund 

Nondefense Mandatory Appropriation 705 5.1 36 

* denotes $500,000 or less. Page 39 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 555
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Labor 

Employment and Training Administration 

012-05-0168 Short Time Compensation Programs 

Nondefense Mandatory Appropriation 219 5.1 11 

012-05-0172 Program Administration 

Nondefense Discretionary Appropriation 98 5.0 5 

012-05-0174 Training and Employment Services 

Nondefense Discretionary Advance appropriation 1,772 5.0 89 

Nondefense Discretionary Appropriation 1,454 5.0 73 

Nondefense Mandatory Appropriation 125 5.1 6 

Account Total 3,351 168 

012-05-0175 Community Service Employment for Older Americans 

Nondefense Discretionary Appropriation 451 5.0 23 

012-05-0179 State Unemployment Insurance and Employment Service Operations 

Nondefense Discretionary Appropriation 88 5.0 4 

Nondefense Mandatory Appropriation 13 5.1 1 

Account Total 101 5 

012-05-0181 Office of Job Corps 

Nondefense Discretionary Appropriation 1,713 5.0 86 

012-05-0187 TAA Community College and Career Training Grant Fund 

Nondefense Mandatory Appropriation 500 5.1 26 

012-05-0326 Federal Unemployment Benefits and Allowances 

Nondefense Mandatory Appropriation 1,132 5.1 58 

012-05-8042 Unemployment Trust Fund 

Nondefense Discretionary Appropriation 4,363 5.0 218 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 92 5.1 5 

Nondefense Mandatory Appropriation 46,851 5.1 2,389 

Account Total 51,306 2,612 

Employee Benefits Security Administration 

012-11-1700 Salaries and Expenses 

Nondefense Discretionary Appropriation 184 5.0 9 

Pension Benefit Guaranty Corporation 

012-12-4204 Pension Benefit Guaranty Corporation Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 118 5.1 6 

Office of Workers' Compensation Programs 

012-15-0163 Salaries and Expenses 

Nondefense Discretionary Appropriation 117 5.0 6 

012-15-0169 Special Benefits for Disabled Coal Miners 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 5 5.1 * 

012-15-1524 Administrative Expenses, Energy Employees Occupational Illness Compensation Fund 

Defense Mandatory Appropriation 129 7.9 10 

Defense Mandatory Unobligated balance in 050 2 7.9 * 

Account Total 131 10 

012-15-8144 Black Lung Disability Trust Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 59 5.1 3 

012-15-9971 Special Workers' Compensation Expenses 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 2 5.1 * 

* denotes $500,000 or less. Page 40 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 556
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Wage and Hour Division 

012-16-0143 Salaries and Expenses 

Nondefense Discretionary Appropriation 228 5.0 11 

Nondefense Discretionary Spending authority 3 5.0 * 

Account Total 231 12 

012-16-5393 H-1 B and L Fraud Prevention and Detection 

Nondefense Mandatory Appropriation 35 5.1 2 

Occupational Safety and Health Administration 

012-18-0400 Salaries and Expenses 

Nondefense Discretionary Appropriation 568 5.0 28 

Mine Safety and Health Administration 

012-19-1200 Salaries and Expenses 

Nondefense Discretionary Appropriation 376 5.0 19 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 377 19 

Bureau of Labor Statistics 

012-20-0200 Salaries and Expenses 

Nondefense Discretionary Appropriation 545 5.0 27 

Office of Federal Contract Compliance Programs 

012-22-0148 Salaries and Expenses 

Nondefense Discretionary Appropriation 106 5.0 5 

Office of Labor Management Standards 

012-23-0150 Salaries and Expenses 

Nondefense Discretionary Appropriation 41 5.0 2 

Departmental Management 

012-25-0106 Office of the Inspector General 

Nondefense Discretionary Appropriation 78 5.0 4 

012-25-0162 Information Technology Modernization 

Nondefense Discretionary Appropriation 20 5.0 1 

012-25-0164 Veterans Employment and Training 

Nondefense Discretionary Appropriation 53 5.0 3 

012-25-0165 Salaries and Expenses 

Nondefense Discretionary Appropriation 348 5.0 17 

012-25-0166 Office of Disability Employment Policy 

Nondefense Discretionary Appropriation 39 5.0 2 

* denotes $500,000 or less. Page 41 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 557
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of State 

Administration of Foreign Affairs 

014-05-0113 Diplomatic and Consular Programs 

Nondefense Discretionary Appropriation 10,966 5.0 548 

Nondefense Discretionary Spending authority 2,290 5.0 115 

Nondefense Mandatory Appropriation 35 5.1 2 

Account Total 13,291 665 

014-05-0120 Capital Investment Fund 

Nondefense Discretionary Appropriation 60 5.0 3 

014-05-0121 Conflict Stabilization Operations 

Nondefense Discretionary Appropriation 8 5.0 * 

014-05-0209 Educational and Cultural Exchange Programs 

Nondefense Discretionary Appropriation 602 5.0 30 

014-05-0520 Protection of Foreign Missions and Officials 

Nondefense Discretionary Appropriation 27 5.0 1 

014-05-0522 Emergencies in the Diplomatic and Consular Service 

Nondefense Discretionary Appropriation 9 5.0 * 

014-05-0523 Payment to the American Institute in Taiwan 

Nondefense Discretionary Appropriation 21 5.0 1 

014-05-0529 Office of the Inspector General 

Nondefense Discretionary Appropriation 129 5.0 6 

014-05-0535 Embassy Security, Construction, and Maintenance 

Nondefense Discretionary Appropriation 1,579 5.0 79 

014-05-0545 Representation Allowances 

Nondefense Discretionary Appropriation 7 5.0 * 

014-05-0601 Repatriation Loans Program Account 

Nondefense Discretionary Appropriation 1 5.0 * 

International Organizations and Conferences 

014-10-1124 Contributions for International Peacekeeping Activities 

Nondefense Discretionary Appropriation 1,839 5.0 92 

014-10-1126 Contributions to International Organizations 

Nondefense Discretionary Appropriation 1,560 5.0 78 

International Commissions 

014-15-1069 Salaries and Expenses, IBWC 

Nondefense Discretionary Appropriation 45 5.0 2 

014-15-1078 Construction, IBWC 

Nondefense Discretionary Appropriation 32 5.0 2 

014-15-1082 American Sections, International Commissions 

Nondefense Discretionary Appropriation 12 5.0 1 

014-15-1087 International Fisheries Commissions 

Nondefense Discretionary Appropriation 37 5.0 2 

Other 

014-25-0040 United States Emergency Refugee and Migration Assistance Fund 

Nondefense Discretionary Appropriation 27 5.0 1 

* denotes $500,000 or less. Page 42 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 558
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

014-25-0202 East-West Center 

Nondefense Discretionary Appropriation 17 5.0 1 

014-25-0210 National Endowment for Democracy 

Nondefense Discretionary Appropriation 118 5.0 6 

014-25-0525 Payment to the Asia Foundation 

Nondefense Discretionary Appropriation 17 5.0 1 

014-25-1015 Complex Crises Fund 

Nondefense Discretionary Appropriation 40 5.0 2 

014-25-1022 International Narcotics Control and Law Enforcement 

Nondefense Discretionary Appropriation 2,051 5.0 103 

014-25-1031 Global Health Programs 

Nondefense Discretionary Appropriation 8,218 5.0 411 

014-25-1121 Democracy Fund 

Nondefense Discretionary Appropriation 115 5.0 6 

014-25-1143 Migration and Refugee Assistance 

Nondefense Discretionary Appropriation 1,885 5.0 94 

014-25-8276 Israeli Arab and Eisenhower Exchange Fellowship Programs 

Nondefense Discretionary Appropriation 1 5.0 * 

* denotes $500,000 or less. Page 43 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 559
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of Transportation 

Office of the Secretary 

021-04-0102 Salaries and Expenses 

Nondefense Discretionary Appropriation 103 5.0 5 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 104 5 

021-04-0116 Financial Management Capital 

Nondefense Discretionary Appropriation 5 5.0 * 

021-04-0118 Office of Civil Rights 

Nondefense Discretionary Appropriation 9 5.0 * 

021-04-0119 Minority Business Outreach 

Nondefense Discretionary Appropriation 3 5.0 * 

021-04-0142 Transportation Planning, Research, and Development 

Nondefense Discretionary Appropriation 9 5.0 * 

021-04-0143 National Infrastructure Investments 

Nondefense Discretionary Appropriation 503 5.0 25 

021-04-0155 Minority Business Resource Center Program 

Nondefense Discretionary Appropriation 1 5.0 * 

021-04-0159 Cyber Security Initiatives 

Nondefense Discretionary Appropriation 10 5.0 1 

021-04-1730 Research and Development 

Nondefense Discretionary Appropriation 16 5.0 1 

021-04-5423 Essential Air Service and Rural Airport Improvement Fund 

Nondefense Mandatory Appropriation 50 5.1 3 

021-04-8304 Payments to Air Carriers 

Nondefense Discretionary Appropriation 144 5.0 7 

Federal Aviation Administration 

021-12-1301 Operations 

Nondefense Discretionary Appropriation 4,621 5.0 231 

Nondefense Discretionary Spending authority 10 5.0 1 

Account Total 4,631 232 

021-12-4120 Aviation Insurance Revolving Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 1 5.1 * 

021-12-8104 Trust Fund Share of FAA Activities (Airport and Airway Trust Fund) 

Nondefense Discretionary Appropriation 5,092 5.0 255 

021-12-8106 Grants-in-aid for Airports (Airport and Airway Trust Fund) 

Nondefense Discretionary Spending authority 1 5.0 * 

021-12-8107 Facilities and Equipment (Airport and Airway Trust Fund) 

Nondefense Discretionary Appropriation 2,778 5.0 139 

Nondefense Discretionary Spending authority 62 5.0 3 

Account Total 2,840 142 

021-12-8108 Research, Engineering and Development (Airport and Airway Trust Fund) 

Nondefense Discretionary Appropriation 169 5.0 8 

Federal Highway Administration 

021-15-0500 Emergency Relief Program 

Nondefense Discretionary Appropriation 2,022 5.0 101 

* denotes $500,000 or less. Page 44 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 560
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

021-15-0534 Payment to the Transportation Trust Fund 

Nondefense Mandatory Appropriation 6,200 5.1 316 

021-15-8083 Federal-aid Highways 

Nondefense Mandatory Contract authority 739 5.1 38 

Federal Motor Carrier Safety Administration 

021-17-8159 Motor Carrier Safety Operations and Programs 

Nondefense Discretionary Spending authority 27 5.0 1 

National Highway Traffic Safety Administration 

021-18-0650 Operations and Research 

Nondefense Discretionary Appropriation 141 5.0 7 

Federal Railroad Administration 

021-27-0121 Operating Subsidy Grants to the National Railroad Passenger Corporation 

Nondefense Discretionary Appropriation 469 5.0 23 

021-27-0125 Capital and Debt Service Grants to the National Railroad Passenger Corporation 

Nondefense Discretionary Appropriation 958 5.0 48 

021-27-0700 Safety and Operations 

Nondefense Discretionary Appropriation 180 5.0 9 

021-27-0704 Grants to the National Railroad Passenger Corporation 

Nondefense Discretionary Appropriation 118 5.0 6 

021-27-0745 Railroad Research and Development 

Nondefense Discretionary Appropriation 35 5.0 2 

Federal Transit Administration 

021-36-1120 Administrative Expenses 

Nondefense Discretionary Appropriation 99 5.0 5 

021-36-1128 Washington Metropolitan Area Transit Authority 

Nondefense Discretionary Appropriation 151 5.0 8 

021-36-1134 Capital Investment Grants 

Nondefense Discretionary Appropriation 1,923 5.0 96 

021-36-1137 Research and University Research Centers 

Nondefense Discretionary Appropriation 44 5.0 2 

021-36-1140 Public Transportation Emergency Relief Program 

Nondefense Discretionary Appropriation 10,894 5.0 545 

Saint Lawrence Seaway Development Corporation 

021-40-8003 Operations and Maintenance 

Nondefense Discretionary Appropriation 32 5.0 2 

Pipeline and Hazardous Materials Safety Administration 

021-50-1400 Operational Expenses 

Nondefense Discretionary Appropriation 20 5.0 1 

021-50-1401 Hazardous Materials Safety 

Nondefense Discretionary Appropriation 42 5.0 2 

021-50-5172 Pipeline Safety 

Nondefense Discretionary Appropriation 92 5.0 5 

021-50-5282 Emergency Preparedness Grants 

Nondefense Mandatory Appropriation 28 5.1 1 

* denotes $500,000 or less. Page 45 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 561
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

021-50-8121 Trust Fund Share of Pipeline Safety 

Nondefense Discretionary Appropriation 19 5.0 1 

Office of Inspector General 

021-56-0130 Salaries and Expenses 

Nondefense Discretionary Appropriation 86 5.0 4 

Surface Transportation Board 

021-61-0301 Salaries and Expenses 

Nondefense Discretionary Appropriation 28 5.0 1 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 29 2 

Maritime Administration 

021-70-1711 Maritime Security Program 

Defense Discretionary Appropriation 175 7.8 14 

Defense Discretionary Unobligated balance in 050 4 7.8 * 

Account Total 179 14 

021-70-1750 Operations and Training 

Nondefense Discretionary Appropriation 157 5.0 8 

021-70-1751 Ocean Freight Differential 

Nondefense Mandatory Borrowing authority 135 5.1 7 

021-70-1752 Maritime Guaranteed Loan (title XI) Program Account 

Nondefense Discretionary Appropriation 4 5.0 * 

021-70-1768 Ship Disposal 

Nondefense Discretionary Appropriation 6 5.0 * 

021-70-1770 Assistance to Small Shipyards 

Nondefense Discretionary Appropriation 10 5.0 1 

* denotes $500,000 or less. Page 46 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 562
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Department of the Treasury 

Financial Crimes Enforcement Network 

015-04-0173 Salaries and Expenses 

Nondefense Discretionary Appropriation 111 5.0 6 

Departmental Offices 

015-05-0101 Salaries and Expenses 

Nondefense Discretionary Appropriation 310 5.0 16 

015-05-0106 Office of Inspector General 

Nondefense Discretionary Appropriation 30 5.0 2 

015-05-0119 Treasury Inspector General for Tax Administration 

Nondefense Discretionary Appropriation 153 5.0 8 

015-05-0123 Terrorism Insurance Program 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 3 5.1 * 

015-05-0126 GSE Mortgage-Backed Securities Purchase Program Account 

Nondefense Mandatory Appropriation 11 5.1 1 

015-05-0140 Grants for Specified Energy Property in Lieu of Tax Credits, Recovery Act 

Nondefense Mandatory Appropriation 3,671 5.1 187 

015-05-0141 Small Business Lending Fund Program Account 

Nondefense Mandatory Appropriation 26 5.1 1 

015-05-1881 Community Development Financial Institutions Fund Program Account 

Nondefense Discretionary Appropriation 222 5.0 11 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 223 11 

015-05-5081 Presidential Election Campaign Fund 

Nondefense Mandatory Appropriation 34 5.1 2 

015-05-5590 Financial Research Fund 

Nondefense Mandatory Appropriation 158 5.1 8 

015-05-5697 Treasury Forfeiture Fund 

Nondefense Mandatory Appropriation 583 5.1 30 

Fiscal Service 

015-12-0520 Salaries and Expenses, Fiscal Service 

Nondefense Discretionary Appropriation 393 5.0 20 

Nondefense Discretionary Spending authority 1 5.0 * 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 68 5.1 3 

Account Total 462 23 

015-12-1710 Payment of Government Losses in Shipment 

Nondefense Mandatory Appropriation 1 5.1 * 

015-12-1825 Payment to FRA for AMTRAK Debt Restructuring 

Nondefense Mandatory Appropriation 59 5.1 3 

015-12-8209 Cheyenne River Sioux Tribe Terrestrial Wildlife Habitat Restoration Trust Fund 

Nondefense Mandatory Appropriation 2 5.1 * 

Alcohol and Tobacco Tax and Trade Bureau 

015-13-1008 Salaries and Expenses 

Nondefense Discretionary Appropriation 100 5.0 5 

Nondefense Discretionary Spending authority 4 5.0 * 

Account Total 104 5 

* denotes $500,000 or less. Page 47 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 563
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Bureau of Engraving and Printing 

015-20-4502 Bureau of Engraving and Printing Fund 

Nondefense Discretionary Spending authority 643 5.0 32 

United States Mint 

015-25-4159 United States Mint Public Enterprise Fund 

Nondefense Discretionary Spending authority 396 5.0 20 

Internal Revenue Service 

015-45-0912 Taxpayer Services 

Nondefense Discretionary Appropriation 2,254 5.0 113 

Nondefense Discretionary Spending authority 17 5.0 1 

Account Total 2,271 114 

015-45-0913 Enforcement 

Nondefense Discretionary Appropriation 5,331 5.0 267 

Nondefense Discretionary Spending authority 17 5.0 1 

Account Total 5,348 267 

015-45-0919 Operations Support 

Nondefense Discretionary Appropriation 3,971 5.0 199 

Nondefense Discretionary Spending authority 12 5.0 1 

Account Total 3,983 199 

015-45-0921 Business Systems Modernization 

Nondefense Discretionary Appropriation 332 5.0 17 

015-45-0935 Build America Bond Payments, Recovery Act 

Nondefense Mandatory Appropriation 3,351 5.1 171 

015-45-0945 Payment to Issuer of Qualified Zone Academy Bonds 

Nondefense Mandatory Appropriation 38 5.1 2 

015-45-0946 Payment to Issuer of Qualified School Construction Bonds 

Nondefense Mandatory Appropriation 820 5.1 42 

015-45-0947 Payment to Issuer of New Clean Renewable Energy Bonds 

Nondefense Mandatory Appropriation 24 5.1 1 

015-45-0948 Payment to Issuer of Qualified Energy Conservation Bonds 

Nondefense Mandatory Appropriation 32 5.1 2 

015-45-0951 Payment Where Small Business Health Insurance Tax Credit Exceeds Liability for Tax 

Nondefense Mandatory Appropriation 127 5.1 6 

015-45-5432 IRS Miscellaneous Retained Fees 

Nondefense Mandatory Appropriation 39 5.1 2 

015-45-5433 Informant Payments 

Nondefense Mandatory Appropriation 125 5.1 6 

* denotes $500,000 or less. Page 48 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 564
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Corps of Engineers--Civil Works 

202-00-3112 Mississippi River and Tributaries 

Nondefense Discretionary Appropriation 252 5.0 13 

202-00-3121 Investigations 

Nondefense Discretionary Appropriation 176 5.0 9 

202-00-3122 Construction 

Nondefense Discretionary Appropriation 5,007 5.0 250 

202-00-3123 Operation and Maintenance 

Nondefense Discretionary Appropriation 2,448 5.0 122 

202-00-3124 Expenses 

Nondefense Discretionary Appropriation 196 5.0 10 

202-00-3125 Flood Control and Coastal Emergencies 

Nondefense Discretionary Appropriation 1,035 5.0 52 

202-00-3126 Regulatory Program 

Nondefense Discretionary Appropriation 194 5.0 10 

202-00-3130 Formerly Utilized Sites Remedial Action Program 

Defense Discretionary Appropriation 110 7.8 9 

Defense Discretionary Unobligated balance in 050 4 7.8 * 

Account Total 114 9 

202-00-3132 Office of the Assistant Secretary of the Army for Civil Works 

Defense Discretionary Appropriation 5 7.8 * 

202-00-4902 Revolving Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 3 5.1 * 

202-00-8217 South Dakota Terrestrial Wildlife Habitat Restoration Trust Fund 

Nondefense Mandatory Appropriation 5 5.1 * 

202-00-8333 Coastal Wetlands Restoration Trust Fund 

Nondefense Mandatory Appropriation 81 5.1 4 

202-00-8861 Inland Waterways Trust Fund 

Nondefense Discretionary Appropriation 77 5.0 4 

202-00-8862 Rivers and Harbors Contributed Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 267 5.1 14 

202-00-8863 Harbor Maintenance Trust Fund 

Nondefense Discretionary Appropriation 882 5.0 44 

202-00-9921 Permanent Appropriations 

Nondefense Mandatory Appropriation 21 5.1 1 

* denotes $500,000 or less. Page 49 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 565
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Other Defense Civil Programs 

American Battle Monuments Commission 

200-15-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 77 5.0 4 

Armed Forces Retirement Home 

200-20-8522 Armed Forces Retirement Home 

Nondefense Discretionary Appropriation 62 5.0 3 

Cemeterial Expenses 

200-25-1805 Salaries and Expenses 

Nondefense Discretionary Appropriation 46 5.0 2 

Forest and Wildlife Conservation, Military Reservations 

200-30-5095 Wildlife Conservation 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 3 5.1 * 

Selective Service System 

200-45-0400 Salaries and Expenses 

Defense Discretionary Appropriation 24 7.8 2 

* denotes $500,000 or less. Page 50 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 566
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Environmental Protection Agency 

020-00-0103 State and Tribal Assistance Grants 

Nondefense Discretionary Appropriation 4,190 5.0 210 

020-00-0107 Science and Technology 

Nondefense Discretionary Appropriation 799 5.0 40 

020-00-0108 Environmental Programs and Management 

Nondefense Discretionary Appropriation 2,696 5.0 135 

020-00-0110 Buildings and Facilities 

Nondefense Discretionary Appropriation 37 5.0 2 

020-00-0112 Office of Inspector General 

Nondefense Discretionary Appropriation 42 5.0 2 

020-00-4310 Reregistration and Expedited Processing Revolving Fund 

Nondefense Mandatory Spending authority 28 5.1 1 

020-00-5374 Pesticide Registration Fund 

Nondefense Discretionary Appropriation 15 5.0 1 

020-00-8145 Hazardous Substance Superfund 

Nondefense Discretionary Appropriation 1,218 5.0 61 

Nondefense Discretionary Spending authority 240 5.0 12 

Nondefense Mandatory Appropriation 25 5.1 1 

Account Total 1,483 74 

020-00-8153 Leaking Underground Storage Tank Trust Fund 

Nondefense Discretionary Appropriation 110 5.0 6 

020-00-8221 Inland Oil Spill Programs 

Nondefense Discretionary Appropriation 18 5.0 1 

* denotes $500,000 or less. Page 51 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 567
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Executive Office of the President 

The White House 

100-05-0209 The White House 

Nondefense Discretionary Appropriation 57 5.0 3 

Executive Residence at the White House 

100-10-0109 White House Repair and Restoration 

Nondefense Discretionary Appropriation 1 5.0 * 

100-10-0210 Operating Expenses 

Nondefense Discretionary Appropriation 13 5.0 1 

Nondefense Discretionary Spending authority 3 5.0 * 

Account Total 16 1 

Special Assistance to the President and the Official Residence of the Vice President 

100-15-1454 Special Assistance to the President and the Official Residence of the Vice President 

Nondefense Discretionary Appropriation 5 5.0 * 

Council of Economic Advisers 

100-20-1900 Salaries and Expenses 

Nondefense Discretionary Appropriation 4 5.0 * 

Council on Environmental Quality and Office of Environmental Quality 

100-25-1453 Council on Environmental Quality and Office of Environmental Quality 

Nondefense Discretionary Appropriation 3 5.0 * 

National Security Council and Homeland Security Council 

100-35-2000 Salaries and Expenses 

Nondefense Discretionary Appropriation 13 5.0 1 

Office of Administration 

100-50-0038 Salaries and Expenses 

Nondefense Discretionary Appropriation 114 5.0 6 

Office of Management and Budget 

100-55-0300 Office of Management and Budget 

Nondefense Discretionary Appropriation 90 5.0 5 

Office of National Drug Control Policy 

100-60-1457 Office of National Drug Control Policy 

Nondefense Discretionary Appropriation 25 5.0 1 

Office of Science and Technology Policy 

100-65-2600 Office of Science and Technology Policy 

Nondefense Discretionary Appropriation 5 5.0 * 

Office of the United States Trade Representative 

100-70-0400 Office of the United States Trade Representative 

Nondefense Discretionary Appropriation 52 5.0 3 

Unanticipated Needs 

100-95-0037 Unanticipated Needs 

Nondefense Discretionary Appropriation 1 5.0 * 

* denotes $500,000 or less. Page 52 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 568
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

General Services Administration 

Real Property Activities 

023-05-4542 Federal Buildings Fund 

Nondefense Discretionary Appropriation 7 5.0 * 

023-05-5254 Disposal of Surplus Real and Related Personal Property 

Nondefense Mandatory Appropriation 9 5.1 * 

Supply and Technology Activities 

023-10-5250 Expenses of Transportation Audit Contracts and Contract Administration 

Nondefense Mandatory Appropriation 13 5.1 1 

General Activities 

023-30-0105 Allowances and Office Staff for Former Presidents 

Nondefense Discretionary Appropriation 3 5.0 * 

023-30-0108 Office of Inspector General 

Nondefense Discretionary Appropriation 58 5.0 3 

023-30-0110 Operating Expenses 

Nondefense Discretionary Appropriation 70 5.0 4 

023-30-0401 Government-wide Policy 

Nondefense Discretionary Appropriation 61 5.0 3 

023-30-0600 Electronic Government (E-GOV) Fund 

Nondefense Discretionary Appropriation 12 5.0 1 

023-30-4549 Federal Citizen Services Fund 

Nondefense Discretionary Appropriation 34 5.0 2 

* denotes $500,000 or less. Page 53 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 569
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

International Assistance Programs 

Millennium Challenge Corporation 

184-03-2750 Millennium Challenge Corporation 

Nondefense Discretionary Appropriation 904 5.0 45 

International Security Assistance 

184-05-1032 Peacekeeping Operations 

Nondefense Discretionary Appropriation 386 5.0 19 

184-05-1037 Economic Support Fund 

Nondefense Discretionary Appropriation 5,675 5.0 284 

184-05-1075 Nonproliferation, Antiterrorism, Demining, and Related Programs 

Nondefense Discretionary Appropriation 714 5.0 36 

184-05-1081 International Military Education and Training 

Nondefense Discretionary Appropriation 106 5.0 5 

184-05-1082 Foreign Military Financing Program 

Nondefense Discretionary Appropriation 6,344 5.0 317 

184-05-1083 Pakistan Counterinsurgency Capability Fund 

Nondefense Discretionary Appropriation 850 5.0 43 

Multilateral Assistance 

184-10-0071 Strategic Climate Fund 

Nondefense Discretionary Appropriation 50 5.0 3 

184-10-0072 Contribution to the Inter-American Development Bank 

Nondefense Discretionary Appropriation 80 5.0 4 

184-10-0073 Contribution to the International Development Association 

Nondefense Discretionary Appropriation 1,501 5.0 75 

184-10-0076 Contribution to the Asian Development Bank 

Nondefense Discretionary Appropriation 208 5.0 10 

184-10-0077 Contribution to the International Bank for Reconstruction and Development 

Nondefense Discretionary Appropriation 208 5.0 10 

184-10-0080 Clean Technology Fund 

Nondefense Discretionary Appropriation 186 5.0 9 

184-10-0082 Contribution to the African Development Bank 

Nondefense Discretionary Appropriation 214 5.0 11 

184-10-0089 Contribution to Enterprise for the Americas Multilateral Investment Fund 

Nondefense Discretionary Appropriation 25 5.0 1 

184-10-0091 Debt Restructuring 

Nondefense Discretionary Appropriation 12 5.0 1 

184-10-1005 International Organizations and Programs 

Nondefense Discretionary Appropriation 351 5.0 18 

184-10-1039 Contributions to the International Fund for Agricultural Development 

Nondefense Discretionary Appropriation 30 5.0 2 

184-10-1045 International Affairs Technical Assistance Program 

Nondefense Discretionary Appropriation 27 5.0 1 

184-10-1475 Global Food Security Fund 

Nondefense Discretionary Appropriation 136 5.0 7 

* denotes $500,000 or less. Page 54 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 570
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Agency for International Development 

184-15-0300 Capital Investment Fund of the United States Agency for International Development. 

Nondefense Discretionary Appropriation 130 5.0 7 

184-15-0306 Assistance for Europe, Eurasia and Central Asia 

Nondefense Discretionary Appropriation 631 5.0 32 

184-15-1000 Operating Expenses of the Agency for International Development 

Nondefense Discretionary Appropriation 1,354 5.0 68 

184-15-1007 Operating Expenses, Office of Inspector General 

Nondefense Discretionary Appropriation 51 5.0 3 

184-15-1021 Development Assistance Program 

Nondefense Discretionary Appropriation 2,535 5.0 127 

184-15-1027 Transition Initiatives 

Nondefense Discretionary Appropriation 57 5.0 3 

184-15-1035 International Disaster Assistance 

Nondefense Discretionary Appropriation 980 5.0 49 

184-15-1264 Development Credit Authority Program Account 

Nondefense Discretionary Appropriation 8 5.0 * 

Overseas Private Investment Corporation 

184-20-0100 Overseas Private Investment Corporation Program Account 

Nondefense Discretionary Spending authority 58 5.0 3 

Trade and Development Agency 

184-25-1001 Trade and Development Agency 

Nondefense Discretionary Appropriation 50 5.0 3 

Peace Corps 

184-35-0100 Peace Corps 

Nondefense Discretionary Appropriation 377 5.0 19 

Inter-American Foundation 

184-40-3100 Inter-American Foundation 

Nondefense Discretionary Appropriation 23 5.0 1 

Nondefense Discretionary Spending authority 6 5.0 * 

Account Total 29 2 

African Development Foundation 

184-50-0700 African Development Foundation 

Nondefense Discretionary Appropriation 30 5.0 2 

Military Sales Program 

184-70-8242 Foreign Military Sales Trust Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 147 5.1 7 

* denotes $500,000 or less. Page 55 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 571
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

National Aeronautics and Space Administration 

026-00-0109 Office of Inspector General 

Nondefense Discretionary Appropriation 39 5.0 2 

026-00-0115 Space Operations 

Nondefense Discretionary Appropriation 4,247 5.0 212 

026-00-0120 Science 

Nondefense Discretionary Appropriation 5,116 5.0 256 

026-00-0122 Cross Agency Support 

Nondefense Discretionary Appropriation 3,012 5.0 151 

026-00-0124 Exploration 

Nondefense Discretionary Appropriation 3,790 5.0 190 

026-00-0126 Aeronautics 

Nondefense Discretionary Appropriation 573 5.0 29 

026-00-0128 Education 

Nondefense Discretionary Appropriation 137 5.0 7 

026-00-0130 Construction, Environmental Compliance, and Remediation 

Nondefense Discretionary Appropriation 402 5.0 20 

026-00-0131 Space Technology 

Nondefense Discretionary Appropriation 579 5.0 29 

026-00-8978 Science, Space, and Technology Education Trust Fund 

Nondefense Mandatory Appropriation 1 5.1 * 

* denotes $500,000 or less. Page 56 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 572
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

National Science Foundation 

422-00-0100 Research and Related Activities 

Defense Discretionary Appropriation 68 7.8 5 

Nondefense Discretionary Appropriation 5,686 5.0 284 

Account Total 5,754 290 

422-00-0106 Education and Human Resources 

Nondefense Discretionary Appropriation 834 5.0 42 

Nondefense Mandatory Appropriation 100 5.1 5 

Account Total 934 47 

422-00-0180 Agency Operations and Award Management 

Nondefense Discretionary Appropriation 301 5.0 15 

422-00-0300 Office of the Inspector General 

Nondefense Discretionary Appropriation 14 5.0 1 

422-00-0350 Office of the National Science Board 

Nondefense Discretionary Appropriation 4 5.0 * 

422-00-0551 Major Research Equipment and Facilities Construction 

Nondefense Discretionary Appropriation 168 5.0 8 

422-00-8960 Donations 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 9 5.1 * 

* denotes $500,000 or less. Page 57 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 573
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Office of Personnel Management 

027-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 99 5.0 5 

027-00-0400 Office of Inspector General 

Nondefense Discretionary Appropriation 3 5.0 * 

027-00-0800 Flexible Benefits Plan Reserve 

Nondefense Mandatory Spending authority 30 5.1 2 

027-00-8135 Civil Service Retirement and Disability Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 48 5.1 2 

027-00-8424 Employees Life Insurance Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 2 5.1 * 

027-00-9981 Employees and Retired Employees Health Benefits Funds 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 17 5.1 1 

* denotes $500,000 or less. Page 58 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 574
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Small Business Administration 

028-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 440 5.0 22 

028-00-0200 Office of Inspector General 

Nondefense Discretionary Appropriation 21 5.0 1 

028-00-0300 Office of Advocacy 

Nondefense Discretionary Appropriation 9 5.0 * 

028-00-1152 Disaster Loans Program Account 

Nondefense Discretionary Appropriation 896 5.0 45 

028-00-1154 Business Loans Program Account 

Nondefense Discretionary Appropriation 487 5.0 24 

* denotes $500,000 or less. Page 59 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 575
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Social Security Administration 

016-00-0400 Office of the Inspector General 

Nondefense Discretionary Appropriation 29 5.0 1 

016-00-8006 Federal Old-age and Survivors Insurance Trust Fund 

Nondefense Discretionary Appropriation 2,744 5.0 137 

016-00-8007 Federal Disability Insurance Trust Fund 

Nondefense Discretionary Appropriation 2,954 5.0 148 

* denotes $500,000 or less. Page 60 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 576
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Access Board 

Architectural and Transportation Barriers Compliance Board 

310-00-3200 Salaries and Expenses 

Nondefense Discretionary Appropriation 7 5.0 * 

Administrative Conference of the United States 

302-00-1700 Salaries and Expenses 

Nondefense Discretionary Appropriation 3 5.0 * 

Advisory Council on Historic Preservation 

306-00-2300 Salaries and Expenses 

Nondefense Discretionary Appropriation 6 5.0 * 

Affordable Housing Program 

530-00-5528 Affordable Housing Program 

Nondefense Mandatory Appropriation 198 5.1 10 

Appalachian Regional Commission 

309-00-0200 Appalachian Regional Commission 

Nondefense Discretionary Appropriation 64 5.0 3 

309-00-9971 Miscellaneous Trust Funds 

Nondefense Mandatory Appropriation 8 5.1 * 

Broadcasting Board of Governors 

514-00-0204 Broadcasting Capital Improvements 

Nondefense Discretionary Appropriation 7 5.0 * 

514-00-0206 International Broadcasting Operations 

Nondefense Discretionary Appropriation 749 5.0 37 

Bureau of Consumer Financial Protection 

581-00-5577 Bureau of Consumer Financial Protection Fund 

Nondefense Mandatory Appropriation 448 5.1 23 

Chemical Safety and Hazard Investigation Board 

510-00-3850 Chemical Safety and Hazard Investigation Board 

Nondefense Discretionary Appropriation 11 5.0 1 

Christopher Columbus Fellowship Foundation 

465-00-0100 Payment to the Christopher Columbus Fellowship Foundation 

Nondefense Discretionary Appropriation * 5.0 * 

Commission of Fine Arts 

323-00-2600 Salaries and Expenses 

Nondefense Discretionary Appropriation 2 5.0 * 

323-00-2602 National Capital Arts and Cultural Affairs 

Nondefense Discretionary Appropriation 2 5.0 * 

Commission on Civil Rights 

326-00-1900 Salaries and Expenses 

Nondefense Discretionary Appropriation 9 5.0 * 

Committee for Purchase from People Who Are Blind or Severely Disabled 

Committee for Purchase from People who are Blind or Severely Disabled, activities 

* denotes $500,000 or less. Page 61 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 577
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

338-00-2000 Salaries and Expenses 

Nondefense Discretionary Appropriation 5 5.0 * 

Commodity Futures Trading Commission 

339-00-1400 Commodity Futures Trading Commission 

Nondefense Discretionary Appropriation 206 5.0 10 

339-00-4334 Customer Protection Fund 

Nondefense Mandatory Spending authority 13 5.1 1 

Consumer Product Safety Commission 

343-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 115 5.0 6 

Corporation for National and Community Service 

485-00-2721 Inspector General 

Nondefense Discretionary Appropriation 4 5.0 * 

485-00-2722 Salaries and Expenses 

Nondefense Discretionary Appropriation 83 5.0 4 

485-00-2726 Payment to National Service Trust Fund 

Nondefense Discretionary Appropriation 213 5.0 11 

485-00-2728 Operating Expenses 

Nondefense Discretionary Appropriation 755 5.0 38 

Corporation for Public Broadcasting 

344-00-0151 Corporation for Public Broadcasting 

Nondefense Discretionary Advance appropriation 445 5.0 22 

Corporation for Travel Promotion 

580-00-5585 Travel Promotion Fund 

Nondefense Mandatory Appropriation 100 5.1 5 

Court Services and Offender Supervision Agency for the District of Columbia 

511-00-1733 Public Defender Service for the District of Columbia 

Nondefense Discretionary Appropriation 37 5.0 2 

511-00-1734 Federal Payment to Court Services and Offender Supervision Agency for the District of Columbia 

Nondefense Discretionary Appropriation 214 5.0 11 

Defense Nuclear Facilities Safety Board 

347-00-3900 Salaries and Expenses 

Defense Discretionary Appropriation 29 7.8 2 

Defense Discretionary Unobligated balance in 050 1 7.8 * 

Account Total 30 2 

Delta Regional Authority 

517-00-0750 Delta Regional Authority 

Nondefense Discretionary Appropriation 12 5.0 1 

Denali Commission 

513-00-1200 Denali Commission 

Nondefense Discretionary Appropriation 12 5.0 1 

513-00-8056 Denali Commission Trust Fund 

Nondefense Discretionary Appropriation

District of Columbia 

4 5.0 * 

* denotes $500,000 or less. Page 62 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 578
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

District of Columbia Courts 

349-10-1712 Federal Payment to the District of Columbia Courts 

Nondefense Discretionary Appropriation 234 5.0 12 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 235 12 

349-10-1736 Defender Services in District of Columbia Courts 

Nondefense Discretionary Appropriation 55 5.0 3 

349-10-8212 District of Columbia Judicial Retirement and Survivors Annuity Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 1 5.1 * 

District of Columbia General and Special Payments 

349-30-1707 Federal Support for Economic Development and Management Reforms in the District 

Nondefense Discretionary Appropriation 23 5.0 1 

349-30-1736 Federal Payment for Resident Tuition Support 

Nondefense Discretionary Appropriation 30 5.0 2 

349-30-1771 Federal Payment for Emergency Planning and Security Cost in the District of Columbia 

Nondefense Discretionary Appropriation 25 5.0 1 

349-30-1817 Federal Payment for School Improvement 

Nondefense Discretionary Appropriation 60 5.0 3 

349-30-5511 District of Columbia Federal Pension Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 17 5.1 1 

Election Assistance Commission 

525-00-1650 Salaries and Expenses 

Nondefense Discretionary Appropriation 9 5.0 * 

Electric Reliability Organization 

531-00-5522 Electric Reliability Organization 

Nondefense Mandatory Appropriation 100 5.1 5 

Equal Employment Opportunity Commission 

350-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 362 5.0 18 

350-00-4019 EEOC Education, Technical Assistance, and Training Revolving Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 4 5.1 * 

Export-Import Bank of the United States 

351-00-0105 Inspector General of the Export-Import Bank 

Nondefense Discretionary Appropriation 4 5.0 * 

Farm Credit System Insurance Corporation 

355-00-4171 Farm Credit System Insurance Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 4 5.1 * 

Federal Communications Commission 

356-00-0100 Salaries and Expenses 

Nondefense Discretionary Spending authority 342 5.0 17 

356-00-0300 Spectrum Auction Program Account 

Nondefense Mandatory Appropriation 4 5.1 * 

Federal Deposit Insurance Corporation 

Orderly Liquidation 

* denotes $500,000 or less. Page 63 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 579
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

357-35-5586 Orderly Liquidation Fund 

Nondefense Mandatory Appropriation 161 5.1 8 

Nondefense Mandatory Borrowing authority 1,354 5.1 69 

Account Total 1,515 77 

Federal Drug Control Programs 

154-00-1070 High-intensity Drug Trafficking Areas Program 

Nondefense Discretionary Appropriation 240 5.0 12 

154-00-1460 Other Federal Drug Control Programs 

Nondefense Discretionary Appropriation 101 5.0 5 

Federal Election Commission 

360-00-1600 Salaries and Expenses 

Nondefense Discretionary Appropriation 67 5.0 3 

Federal Financial Institutions Examination Council 

Federal Financial Institutions Examination Council Appraisal Subcommittee 

362-20-5026 Registry Fees 

Nondefense Mandatory Appropriation 2 5.1 * 

Federal Labor Relations Authority 

365-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 25 5.0 1 

Federal Maritime Commission 

366-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 24 5.0 1 

Federal Mediation and Conciliation Service 

367-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 46 5.0 2 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 47 2 

Federal Mine Safety and Health Review Commission 

368-00-2800 Salaries and Expenses 

Nondefense Discretionary Appropriation 18 5.0 1 

Federal Trade Commission 

370-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 185 5.0 9 

Nondefense Discretionary Spending authority 129 5.0 6 

Account Total 314 16 

Harry S Truman Scholarship Foundation 

372-00-0950 Payment to the Harry S. Truman Scholarship Memorial Trust Fund 

Nondefense Discretionary Appropriation 1 5.0 * 

Institute of American Indian and Alaska Native Culture and Arts Development 

373-00-2900 Payment to the Institute 

Nondefense Discretionary Appropriation 9 5.0 * 

Institute of Museum and Library Services 

474-00-0300 Office of Museum and Library Services: Grants and Administration 

Nondefense Discretionary Appropriation 233 5.0 12 

Intelligence Community Management Account 

* denotes $500,000 or less. Page 64 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 580
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

467-00-0401 Intelligence Community Management Account 

Defense Discretionary Appropriation 551 7.8 43 

International Trade Commission 

378-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 80 5.0 4 

Legal Services Corporation 

385-00-0501 Payment to Legal Services Corporation 

Nondefense Discretionary Appropriation 351 5.0 18 

Marine Mammal Commission 

387-00-2200 Salaries and Expenses 

Nondefense Discretionary Appropriation 3 5.0 * 

Merit Systems Protection Board 

389-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 40 5.0 2 

Morris K. Udall and Stewart L. Udall Foundation 

487-00-0900 Federal Payment to Morris K. Udall and Stewart L. Udall Foundation Trust Fund 

Nondefense Discretionary Appropriation 2 5.0 * 

487-00-5415 Environmental Dispute Resolution Fund 

Nondefense Discretionary Appropriation 4 5.0 * 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 3 5.1 * 

Account Total 7 * 

National Archives and Records Administration 

393-00-0300 Operating Expenses 

Nondefense Discretionary Appropriation 375 5.0 19 

393-00-0301 National Historical Publications and Records Commission 

Nondefense Discretionary Appropriation 5 5.0 * 

393-00-0302 Repairs and Restoration 

Nondefense Discretionary Appropriation 9 5.0 * 

393-00-0305 Office of the Inspector General - National Archives and Records Adminsitration 

Nondefense Discretionary Appropriation 4 5.0 * 

393-00-8436 National Archives Trust Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 1 5.1 * 

National Capital Planning Commission 

394-00-2500 Salaries and Expenses 

Nondefense Discretionary Appropriation 8 5.0 * 

National Council on Disability 

413-00-3500 Salaries and Expenses 

Nondefense Discretionary Appropriation 3 5.0 * 

National Credit Union Administration 

415-00-4472 Community Development Credit Union Revolving Loan Fund 

Nondefense Discretionary Appropriation 1 5.0 * 

National Endowment for the Arts 

417-00-0100 National Endowment for the Arts: Grants and Administration 

Nondefense Discretionary Appropriation 147 5.0 7 

* denotes $500,000 or less. Page 65 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 581
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

National Endowment for the Humanities 

418-00-0200 National Endowment for the Humanities: Grants and Administration 

Nondefense Discretionary Appropriation 147 5.0 7 

National Labor Relations Board 

420-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 280 5.0 14 

National Mediation Board 

421-00-2400 Salaries and Expenses 

Nondefense Discretionary Appropriation 13 5.0 1 

National Railroad Passenger Corporation Office of Inspector General 

575-00-2996 Salaries and Expenses 

Nondefense Discretionary Appropriation 21 5.0 1 

National Transportation Safety Board 

424-00-0310 Salaries and Expenses 

Nondefense Discretionary Appropriation 103 5.0 5 

Neighborhood Reinvestment Corporation 

428-00-1300 Payment to Neighborhood Reinvestment Corporation 

Nondefense Discretionary Appropriation 216 5.0 11 

Northern Border Regional Commission 

573-00-3742 Northern Border Regional Commission 

Nondefense Discretionary Appropriation 1 5.0 * 

Nuclear Regulatory Commission 

429-00-0200 Salaries and Expenses 

Nondefense Discretionary Appropriation 1,033 5.0 52 

Nondefense Discretionary Spending authority 6 5.0 * 

Account Total 1,039 52 

429-00-0300 Office of Inspector General 

Nondefense Discretionary Appropriation 11 5.0 1 

Nuclear Waste Technical Review Board 

431-00-0500 Salaries and Expenses 

Nondefense Discretionary Appropriation 3 5.0 * 

Occupational Safety and Health Review Commission 

432-00-2100 Salaries and Expenses 

Nondefense Discretionary Appropriation 12 5.0 1 

Office of Government Ethics 

434-00-1100 Salaries and Expenses 

Nondefense Discretionary Appropriation 19 5.0 1 

Nondefense Discretionary Spending authority 1 5.0 * 

Account Total 20 1 

Office of Navajo and Hopi Indian Relocation 

435-00-1100 Salaries and Expenses 

Nondefense Discretionary Appropriation 8 5.0 * 

Office of Special Counsel 

* denotes $500,000 or less. Page 66 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 582
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

436-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 19 5.0 1 

Office of the Federal Coordinator for Alaska Natural Gas Transportation Projects 

534-00-2850 Office of the Federal Coordinator for Alaska Natural Gas Transportation 

Nondefense Discretionary Appropriation 1 5.0 * 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 2 5.1 * 

Account Total 3 * 

Other Commissions and Boards 

505-00-9911 Other Commissions and Boards 

Nondefense Discretionary Appropriation 1 5.0 * 

Patient-Centered Outcomes Research Trust Fund 

579-00-8299 Patient-Centered Outcomes Research Trust Fund 

Nondefense Mandatory Appropriation 390 5.1 20 

Postal Service 

440-00-1001 Payment to Postal Service Fund 

Nondefense Discretionary Advance appropriation 78 5.0 4 

Presidio Trust 

512-00-4331 Presidio Trust 

Nondefense Discretionary Appropriation 12 5.0 1 

Privacy and Civil Liberties Oversight Board 

535-00-2724 Salaries and Expenses 

Defense Discretionary Appropriation 1 7.8 * 

Railroad Retirement Board 

446-00-8010 Railroad Social Security Equivalent Benefit Account 

Nondefense Discretionary Appropriation 34 5.0 2 

446-00-8051 Railroad Unemployment Insurance Trust Fund 

Nondefense Discretionary Appropriation 15 5.0 1 

Nondefense Mandatory Appropriation 99 5.1 5 

Nondefense Mandatory Spending authority 20 5.1 1 

Account Total 134 7 

Recovery Accountability and Transparency Board 

Recovery Act Accountability and Transparency Board 

539-00-3725 Recovery Act Accountability and Transparency Board, Recovery Act 

Nondefense Discretionary Appropriation 28 5.0 1 

Securities and Exchange Commission 

449-00-0100 Salaries and Expenses 

Nondefense Discretionary Spending authority 1,321 5.0 66 

449-00-5566 Securities and Exchange Commission Reserve Fund 

Nondefense Mandatory Appropriation 50 5.1 3 

449-00-5567 Investor Protection Fund 

Nondefense Mandatory Appropriation 90 5.1 5 

Public Company Accounting Oversight Board 

* denotes $500,000 or less. Page 67 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 583
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

526-00-5376 Public Company Accounting Oversight Board 

Nondefense Discretionary Appropriation 1 5.0 * 

Nondefense Mandatory Appropriation 236 5.1 12 

Account Total 237 12 

Standard Setting Body 

527-00-5377 Payment to Standard Setting Body 

Nondefense Mandatory Appropriation 25 5.1 1 

Securities Investor Protection Corporation 

576-00-5600 Securities Investor Protection Corporation 

Nondefense Mandatory Appropriation 299 5.1 15 

Smithsonian Institution 

452-00-0100 Salaries and Expenses 

Nondefense Discretionary Appropriation 642 5.0 32 

452-00-0103 Facilities Capital 

Nondefense Discretionary Appropriation 176 5.0 9 

452-00-0200 Salaries and Expenses, National Gallery of Art 

Nondefense Discretionary Appropriation 115 5.0 6 

452-00-0201 Repair, Restoration, and Renovation of Buildings, National Gallery of Art 

Nondefense Discretionary Appropriation 15 5.0 1 

452-00-0302 Operations and Maintenance, JFK Center for the Performing Arts 

Nondefense Discretionary Appropriation 23 5.0 1 

452-00-0303 Capital Repair and Restoration, JFK Center for the Performing Arts 

Nondefense Discretionary Appropriation 14 5.0 1 

452-00-0400 Salaries and Expenses, Woodrow Wilson International Center for Scholars 

Nondefense Discretionary Appropriation 11 5.0 1 

State Justice Institute 

453-00-0052 State Justice Institute: Salaries and Expenses 

Nondefense Discretionary Appropriation 5 5.0 * 

Tennessee Valley Authority 

455-00-4110 Tennessee Valley Authority Fund 

Nondefense Mandatory Administrative expenses in otherwise exempt resources 455 5.1 23 

United States Court of Appeals for Veterans Claims 

345-00-0300 Salaries and Expenses 

Nondefense Discretionary Appropriation 31 5.0 2 

United States Holocaust Memorial Museum 

456-00-3300 Holocaust Memorial Museum 

Nondefense Discretionary Appropriation 51 5.0 3 

United States Institute of Peace 

458-00-1300 Operating Expenses 

Nondefense Discretionary Appropriation 39 5.0 2 

United States Interagency Council on Homelessness 

376-00-1300 United States Interagency Council on the Homelessness 

Nondefense Discretionary Appropriation 3 5.0 * 

Vietnam Education Foundation 

* denotes $500,000 or less. Page 68 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 584
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

519-00-5365 Vietnam Debt Repayment Fund
 

Nondefense Mandatory Appropriation 5 5.1 *
 

* denotes $500,000 or less. Page 69 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 585
Sequestrable Budgetary Resources and Reductions in Sequestrable Resources by OMB Account -- FY 2013 

(Amounts in millions) 

Sequestrable Sequester Sequester 

Agency / Bureau / Account / Function / BEA Category / Budgetary Resource BA Amount Percentage Amount 

Amounts may not sum to total due to rounding.
 

Mandatory Federal administrative expenses of otherwise exempt accounts are sequestrable pursuant to section 251A(8) and section 256(h) of BBEDCA.
 

Pursuant to section 255(f) of BBEDCA, the President notified the Congress of his decision to exempt all military personnel accounts from sequester for FY 2013.
 

See the July 31, 2012 letter to the Congress, available at http://www.whitehouse.gov/sites/default/files/omb/legislative/letters/military-personnel-letter-biden.pdf.
 

Unobligated balances of budget authority carried over from prior fiscal years in defense function 050 accounts are sequestrable.
 

For intragovernmental payments, sequestration is applied to the paying account. The funds are generally exempt in the receiving account in accordance with
 

section 255(g)(1)(A) of BBEDCA so that the same dollars are not sequestered twice.
 

* denotes $500,000 or less. Page 70 of 70 

Department of the Navy Administrative Record for FY 2013 Furlough Appeals 586
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Department of the Navy Administrative Record for FY 2013 Furlough Appeals 589
Department of the Navy Administrative Record for FY 2013 Furlough Appeals 590
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In the meantime, consistent with OMB guidance, DoD needs to continue normal 

spending and operations. We do not want our programs, personnel, and activities to begin to 

suffer the harmful effects of sequestration while there is still a chance it can be avoided. I am 

therefore directing that all commanders and managers in the Department of Defense continue the 

defense mission under current laws and policies, without taking any steps that assume 

sequestration will occur. Commanders should not, for example, curtail planned training, 

maintenance, healthcare or family programs. Commanders and managers should not alarm our 

employees and their families by announcing personnel actions related to sequestration or by 

suggesting that these actions are likely. Nor should commanders and managers hold back on the 

obligation of funds - either for investments or for operating programs - if those funds would 

have been obligated in the absence ofthe sequester threat. 

If you have questions about this guidance, please consult your chain of command. 

Addressees on this memo who have questions should direct them to the Under Secretary of 

Defense (Comptroller). 

Attachment: 

As stated 

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