I
104TH CONGRESS
2D SESSION
H. R. 4142
To amend the Congressional Budget Act of 1974.
IN THE HOUSE OF REPRESENTATIVES
SEPTEMBER 24, 1996
Mr. BARTON of Texas (for himself and Mr. STENHOLM) introduced the follow-
ing bill; which was referred to the Committee on Budget, and in addition
to the Committees on Government Reform and Oversight, and Rules, for
a period to be subsequently determined by the Speaker, in each case for
consideration of such provisions as fall within the jurisdiction of the com-
mittee concerned
A BILL
To amend the Congressional Budget Act of 1974.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Save Our Savings Act of 1996’’.
(b) TABLE OF CONTENTS.—
Sec. 1. Short title and table of contents.
Sec. 2. Definitions.
TITLE I—CAP ENTITLEMENTS AND OTHER MANDATORY
SPENDING
Sec. 101. Timetable.
Sec. 102. Direct spending caps.
Sec. 103. Economic assumptions.
Sec. 104. Revisions to the caps for entitlements and other mandatory spending.
TITLE II—ENFORCEMENT PROVISIONS
Sec. 201. Reporting excess spending.
Sec. 202. Enforcing direct spending caps.
Sec. 203. Enforcing direct spending limits.
Sec. 204. Exempt programs and activities.
Sec. 205. Special rules.
Sec. 206. The current law baseline.
SEC. 2. DEFINITIONS.
For purposes of this Act:
(1) ELIGIBLE POPULATION.—The term ‘‘eligible
population’’ shall mean those individuals to whom
the United States is obligated to make a payment
under the provisions of a law creating entitlement
authority. Such term shall not include States, local-
ities, corporations or other nonliving entities.
(2) SEQUESTER
AND
SEQUESTRATION.—The
terms ‘‘sequester’’ and ‘‘sequestration’’ refer to or
mean the cancellation of budgetary resources pro-
vided by discretionary appropriations or direct
spending law.
(3) BREACH.—The term ‘‘breach’’ means, for
any fiscal year, the amount (if any) by which outlays
for that year (within a category of direct spending)
is above that category’s direct spending cap for that
year.
(4) BASELINE.—The term ‘‘baseline’’ means
the projection (described in section 206) of current
levels of new budget authority, outlays, receipts, and
the surplus or deficit into the budget year and the
outyears.
(5) 
BUDGETARY
RESOURCES.—The 
term
‘‘budgetary resources’’ means new budget authority,
unobligated balances, direct spending authority, and
obligation limitations.
(6) 
DISCRETIONARY
APPROPRIATIONS.—The
term ‘‘discretionary appropriations’’ means budg-
etary resources (except to fund direct spending pro-
grams) provided in appropriation Acts. If an appro-
priation Act alters the level of direct spending or off-
setting collections, that effect shall be treated as di-
rect spending. Classifications of new accounts or ac-
tivities and changes in classifications shall be made
in consultation with the Committees on Appropria-
tions and the Budget of the House of Representa-
tives and the Senate and with CBO and OMB.
(7) DIRECT
SPENDING.—The term ‘‘direct
spending’’ means—
(A) budget authority provided by law other
than appropriation Acts, including entitlement
authority;
(B) entitlement authority; and
(C) the food stamp program.
If a law other than an appropriation Act alters the
level of discretionary appropriations or offsetting col-
lections, that effect shall be treated as direct spend-
ing.
(8) ENTITLEMENT AUTHORITY.—The term ‘‘en-
titlement authority’’ means authority (whether tem-
porary or permanent) to make payments (including
loans and grants), the budget authority for which is
not provided for in advance by appropriation Acts,
to any person or government if, under the provisions
of the law containing such authority, the United
States is obligated to make such payments to per-
sons or governments who meet the requirements es-
tablished by such law.
(9) CURRENT.—The term ‘‘current’’ means,
with respect to OMB estimates included with a
budget submission under section 1105(a) of title 31
U.S.C., the estimates consistent with the economic
and technical assumptions underlying that budget.
(10) ACCOUNT.—The term ‘‘account’’ means an
item for which there is a designated budget account
designation number in the President’s budget.
(11) BUDGET YEAR.—The term ‘‘budget year’’
means the fiscal year of the Government that starts
on the next October 1.
(12) CURRENT
YEAR.—The term ‘‘current
year’’ means, with respect to a budget year, the fis-
cal year that immediately precedes that budget year.
(13) OUTYEAR.—The term ‘‘outyear’’ means,
with respect to a budget year, any of the fiscal years
that follow the budget year.
(14) OMB.—The term ‘‘OMB’’ means the Di-
rector of the Office of Management and Budget.
(15) CBO.—The term ‘‘CBO’’ means the Di-
rector of the Congressional Budget Office.
(16) BUDGET
OUTLAYS
AND
OUTLAYS.—The
terms ‘‘budget outlays’’ and ‘‘outlays’’ mean, with
respect to any fiscal year, expenditures of funds
under budget authority during such year.
(17) BUDGET AUTHORITY AND NEW BUDGET
AUTHORITY.—The terms ‘‘budget authority’’ and
‘‘new budget authority’’ have the meanings given to
them in section 3 of the Congressional Budget and
Impoundment Control Act of 1974.
(18) TAX EXPENDITURES.—The term ‘‘tax ex-
penditures’’ means those revenue losses attributable
to provisions of the Federal tax laws which allow a
special exclusion, exemption, or deduction from gross
income or which provide a special credit, a pref-
erential rate of tax, or a deferral of tax liability.
(19) TAX EXPENDITURES BUDGET.—The term
‘‘tax expenditures budget’’ means an enumeration of
such tax expenditures.
(20) APPROPRIATION ACT.—The term ‘‘appro-
priation Act’’ means an Act referred to in section
105 of title 1 of the United States Code.
(21) DEFICIT.—The term ‘‘deficit’’ means, with
respect to a fiscal year, the amount by which outlays
exceed receipts during that year.
(22) SURPLUS.—The term ‘‘surplus’’ means,
with respect to a fiscal year, the amount by which
receipts exceed outlays during that year.
(23) GOVERNMENT-SPONSORED ENTERPRISE.—
The term ‘‘government-sponsored enterprise’’ means
a corporate entity created by a law of the United
States that—
(A) has a Federal charter authorized by
law;
(B) is privately owned, as evidenced by
capital stock owned by private entities or indi-
viduals;
(C) is under the direction of a board of di-
rectors, a majority of which is elected by private
owners;
(D) is a financial institution with power
to—
(i) make loans or loan guarantees for
limited purposes such as to provide credit
for specific borrowers or one sector; and
(ii) raise funds by borrowing (which
does not carry the full faith and credit of
the Federal Government) or to guarantee
the debt of others in unlimited amounts;
(iii) does not exercise powers that are
reserved to the Government as sovereign
(such as the power to tax or to regulate
interstate commerce);
(iv) does not have the power to com-
mit the Government financially (but it may
be a recipient of a loan guarantee commit-
ment made by the Government); and
(v) has employees whose salaries and
expenses are paid by the enterprise and
are not Federal employees subject to title
5 of the United States Code.
(23) SALE OF AN ASSET.—The term ‘‘sale of an
asset’’ means the sale to the public of any physical
asset owned in whole or in part by the United
States.
(24) DIRECT SPENDING CAPS.—The term ‘‘di-
rect spending caps’’ means the nominal dollar limits
for entitlements and other mandatory spending pur-
suant to section 102 (as modified by any revisions
provided for in this Act).
SEC. 101. TIMETABLE.
On or before:
Action to be completed:
January 15 ....................................
CBO economic and budget update.
First Monday in February ............
President’s budget. Includes seques-
tration update based on new as-
sumptions.
July l .............................................
Cut off for in-session sequester.
August l .........................................
Baseline update—OMB and CBO.
August l5 .......................................
Preview report.
October l ........................................
Start of new fiscal year.
December l5 ...................................
OMB issues final (look back) report
for prior year and preview for cur-
rent year.
December 15 ..................................
Presidential sequester order.
SEC. 102. DIRECT SPENDING CAPS.
Effective upon the date of enactment of this Act, the
following direct spending caps shall apply to all entitle-
ment authority except for undistributed offsetting receipts
and net interest outlays.
[Fiscal years—$ in millions]
1997
1998
1999
2000
2001
2002
Medicaid ..........................
$106,505
$113,524
$120,576
$128,327
$135,318
$144,758
Food stamps ....................
26,001
25,763
26,963
28,282
29,513
30,715
Supplemental security in-
come .............................
25,944
25,457
27,011
31,737
28,844
33,910
Family support ................
19,673
20,189
20,832
21,319
21,701
21,791
Earned income tax credit
19,746
20,438
21,228
22,106
22,919
23,642
Social security .................
365,403
383,402
402,351
422,412
444,081
466,767
Medicare ..........................
188,684
204,807
217,543
232,051
248,109
266,981
Federal retirement:
Civilian/other ...............
46,030
48,448
51,044
53,8888
56,689
59,680
Military ........................
29,848
30,881
31,949
33,022
34,122
35,259
Unemployment compensa-
tion ...............................
25,555
26,613
27,644
28,698
29,814
30,989
Veterans’ benefits ............
20,179
20,499
20,644
22,243
19,643
21,131
[Fiscal years—$ in millions]
1997
1998
1999
2000
2001
2002
Other entitlements and
mandatory spending ....
26,421
36,887
34,352
36,269
36,760
36,524
Total entitlements
and other manda-
tory spending .......
899,989
956,908
1,002,137
1,060,311
1,107,470
1,172,285
SEC. 103. ECONOMIC ASSUMPTIONS.
Subject to periodic reestimation based on changed
economic conditions or changes in eligible population, de-
terminations of the direct spending caps under section
102, any breaches of such caps, and actions necessary to
remedy such breaches shall be based on the following eco-
nomic assumptions (Fiscal Years).
Prelimi-
nary 1
1996
Forecast
1997
1998
1999–
2000
2001
2002
Nominal GDP (billions of dollars) ....
7,491
7,853
8,225
8,627
9,047
9,489
9,952
Nominal GDP (percentage change)
4.3
4.8
4.7
4.9
4.9
4.9
4.9
Real GDP 2 (percentage change) .......
1.8
2.0
2.0
2.1
2.1
2.1
2.1
Chain-type GDP price:
Index (percent change) ..............
2.6
2.8
2.7
2.7
2.7
2.7
2.7
CPI-U 3 (percentage change) .....
2.7
3.1
3.1
2.9
2.9
2.9
3.0
Unemployment rate (percent) ...........
5.7
6.0
6.0
6.0
6.0
6.0
6.0
Three-month 
Treasury 
bill
rate (percent) .................................
5.0
4.8
4.8
4.8
4.8
4.8
4.8
Ten-year Treasury note rate (per-
cent) ...............................................
6.0
6.3
6.4
6.4
6.4
6.4
6.4
Tax bases (billions of dollars):
Corporate profits .......................
595
609
618
618
626
643
665
Other taxable income .................
1,578
1,643
1,731
1,834
1,933
2,033
2,132
Wage and salary disbursements
3,548
3,719
3,889
4,076
4,272
4,475
4,688
Total ...................................
5,721
5,972
6,237
6,529
6,831
7,151
7,485
Tax bases (percentage of GDP):
Corporate profits .......................
7.9
7.8
7.5
7.2
6.0
6.9
6.8
Other taxable income .................
21.1
20.9
21.0
21.3
21.4
21.4
21.4
Wage and salary disbursements
47.4
47.4
47.3
47.3
47.2
47.2
47.1
Total ...........................
76.4
76.0
75.8
75.7
75.5
75.4
75.2
Source: The Congressional Budget Office. The Economic and Budget Outlook: Fiscal Year 1997–
2006, p. 15.
1 Consistent with the first official estimate for 1995 published on March 5, 1996.
2 Based on chained (1992) dollars.
3 CPI-U is the Consumer Price Index for all Urban Consumers.
SEC. 104. REVISIONS TO THE CAPS FOR ENTITLEMENTS
AND OTHER MANDATORY SPENDING
(a) AUTOMATIC ADJUSTMENTS TO CAPS FOR ENTI-
TLEMENTS AND OTHER MANDATORY SPENDING.—When
the President submits the budget under section 1105(a)
of title 31, United States Code, for any year, OMB shall
calculate (in the order set forth below), and the budget
and reports shall include, adjustments to the direct spend-
ing caps (and those limits as cumulatively adjusted) for
the current year, the budget year, and each outyear, to
reflect the following:
(1) CHANGES
IN
CONCEPTS
AND
DEFINI-
TIONS.—The adjustments produced by changes in
concepts and definitions shall equal the baseline lev-
els 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 in concepts and defini-
tions may only be made in consultation with the
Committees on Appropriations, the Budget, and
Government Reform and Oversight and Govern-
mental Affairs of the House of Representatives and
the Senate.
(2) CHANGES IN NET OUTLAYS.—Changes in
net outlays for all programs and activities exempt
from sequestration under section 204.
(3) CHANGES IN INFLATION.—Inflation adjust-
ment factors shall equal the ratio between the level
of year-over-year inflation measured for the fiscal
year most recently completed and the applicable esti-
mated level for that year as set forth in the table at
section 103 (Economic Assumptions). Inflation shall
be measured as follows: for indexed programs, infla-
tion shall be measured by the changes in the index
specified in law; for programs providing health care,
inflation shall be measured by changes in the
consumer price index for all urban consumers for
medical care components (CPI-U medical care); and
for all other programs, inflation shall be measured
by changes in the consumer price index for all urban
consumers (CPI-U). The baseline and the direct
spending caps shall be adjusted to reflect those
changes.
(4) CHANGES
IN
ELIGIBLE
POPULATIONS.—
Changes in the projection of the number of eligible
beneficiaries from the projections in the calculation
of CBO’s Estimates of the President’s Budgetary
Proposals contained in The Economic and Budget
Outlook: Fiscal Years 1997–2006.
(5) INTRA-BUDGETARY PAYMENTS.—From dis-
cretionary accounts to mandatory accounts. The
baseline and the discretionary spending caps shall be
adjusted to reflect those changes.
(b) PERMISSIBLE REVISIONS TO DIRECT SPENDING
CAPS.—Direct spending caps as enacted pursuant to sec-
tion 102 may be revised as follows: Except as required
pursuant to section 104(a), direct spending caps may only
be amended by recorded vote. It shall be a matter of high-
est privilege in the House of Representatives and the Sen-
ate for a Member of the House of Representatives or the
Senate to insist on a recorded vote solely on the question
of amending such caps. It shall not be in order for the
Committee on Rules of the House of Representatives to
report a resolution waiving the provisions of this sub-
section. This subsection may be waived in the Senate only
by an affirmative vote of three-fifths of the Members duly
chosen and sworn.
TITLE II—ENFORCEMENT
PROVISIONS
SEC. 201. REPORTING EXCESS SPENDING.
(a) ANALYSIS OF ACTUAL SPENDING LEVELS.—Fol-
lowing the end of any fiscal year OMB shall compile a
statement of actual direct spending for that year. The
statement shall identify such spending by categories con-
tained in section 102.
(b) ESTIMATE OF NECESSARY SPENDING REDUC-
TION.—Based on the statement provided under subsection
(a), the OMB shall issue a report to the President and
the Congress on December 15 of any year in which such
statement identifies actual or projected spending in the
current or immediately preceding fiscal years in excess of
the applicable total direct spending caps in section 102,
as adjusted pursuant to section 104, by more than one
percent of the applicable total direct spending caps for
such year. The report shall include:
(1) All instances in which actual direct spend-
ing has exceeded the applicable direct spending cap.
(2) The difference between the amount of
spending available under the direct spending caps
for the current year and estimated actual spending
for the categories associated with such caps.
(3) The amounts by which direct spending must
be reduced in the current fiscal year so that total ac-
tual and estimated direct spending for all cap cat-
egories for the current and immediately preceding
fiscal years shall not exceed the amounts available
under the direct spending caps for such fiscal years.
(4) The amount of excess spending attributable
solely to changes in inflation or eligible populations.
(c) TIMETABLE.—
Date:
Actions to be completed:
January 15 ....................................
CBO economic and budget update.
First Monday in February ............
President’s budget (includes seques-
tration update based on new as-
sumptions.
August 1 ........................................
CBO and OMB updates.
August 15 ......................................
Preview report.
December 15 ..................................
OMB issues final (look back) report
for prior year and preview for cur-
rent year.
December 15 ..................................
Presidential sequester order.
SEC. 202. ENFORCING DIRECT SPENDING CAPS.
(a) GENERAL STATEMENT ON SPENDING CAPS.—
This title provides enforcement of the direct spending caps
on categories of spending established pursuant to section
102. This section shall apply for any fiscal year in which
direct spending exceeds the applicable direct spending cap.
(b) OVERALL RULES.—
(1) ELIMINATING
A
BREACH.—Each non-ex-
empt account within a category shall be reduced by
a dollar amount calculated by multiplying the base-
line level of sequestrable budgetary resources in that
account at that time by the uniform percentage nec-
essary to eliminate a breach within that category.
(2) PROGRAMS, PROJECTS, OR
ACTIVITIES.—
Except as otherwise provided, the same percentage
sequestration shall apply to all programs, projects
and activities within a budget account (with pro-
grams, projects and activities as delineated in the
appropriation Act or accompanying report for the
relevant fiscal year covering that account, or for
amounts not included in appropriation Acts, as iden-
tified in the section ‘‘Federal Programs by Agency
and Account’’ as it appears in the Analytical Per-
spectives to the President’s FY 1997 Budget Pro-
posal beginning at page 383.
(3) ADMINISTRATIVE
EXPENSES
ASSOCIATED
WITH
CERTAIN
PROGRAMS.—Notwithstanding any
exemption, general rule or special rule in this Act,
administrative expenses associated with all programs
shall be fully subject to sequestration under this sec-
tion.
(4) INDEFINITE AUTHORITY.—Except as other-
wise provided, sequestration in accounts for which
obligations are indefinite shall be taken in a manner
to ensure that obligations in the fiscal year of a se-
questration and succeeding fiscal years are reduced,
from the level that would actually have occurred, by
the applicable sequestration percentage or percent-
ages.
(5) 
CANCELLATION
OF
BUDGETARY
RE-
SOURCES.—Budgetary resources sequestered from
any account other than an entitlement trust, special
or revolving fund account shall revert to the Treas-
ury and be permanently canceled or repealed.
(6) IMPLEMENTING
REGULATIONS.—Adminis-
trative regulations or similar actions implementing
the sequestration of a program or activity shall be
made within 30 days of the effective date of the se-
questration of that program or activity.
SEC. 203. ENFORCING DIRECT SPENDING LIMITS.
(a) IN GENERAL.—All direct spending (except mat-
ters exempted from the caps under section 204) shall be
subject to caps on total direct spending outlays for each
fiscal year. Consistent with the cap on total outlays, sepa-
rate caps are established for—
(1) any program (named in the table at section
102,
(2) such other program or groups of programs
for which additional caps shall be established in sub-
sequent legislation, and
(3) the remainder of direct spending programs,
except that the separate caps in section 102, plus any ad-
ditional direct spending under such additional separate
caps as shall be established in subsequent legislation, shall
not exceed the cap for total direct spending in section 102,
as adjusted in accordance with section 104.
(b) GENERAL RULES.—For programs subject to di-
rect spending caps:
(1) TRIGGERING OF SEQUESTRATION.—Seques-
tration is triggered if total direct spending subject to
the caps exceeds or is projected to exceed the aggre-
gate cap for direct spending for the current or im-
mediately preceding fiscal year.
(2) CALCULATION
OF
REDUCTIONS.—Seques-
tration shall reduce spending under each separate
direct spending cap in proportion to the amounts
each category of direct spending contributes or con-
tributed to the overage.
(3) UNIFORM
PERCENTAGES.—In calculating
the uniform percentage applicable to the sequestra-
tion of all spending programs or activities within
each category, or the uniform percentage applicable
to the sequestration of nonexempt direct spending
programs or activities, the sequestrable base for di-
rect spending programs and activities is the total
level of outlays for the fiscal year for those programs
or activities in the current law baseline.
(4) PERMANENT
SEQUESTRATION
OF
DIRECT
SPENDING.—Obligations in sequestered direct spend-
ing accounts shall be reduced in the fiscal year in
which a sequestration occurs and in all succeeding
fiscal years. Notwithstanding any other provision of
this section, after the first direct spending seques-
tration, any later sequestration shall reduce direct
spending by an amount in addition to, rather than
in lieu of, the reduction in direct spending in place
under the existing sequestration or sequestrations.
(5) SPECIAL RULE.—For any direct spending
program in which—
(A) outlays pay for entitlement benefits;
(B) a current-year sequestration takes ef-
fect after the 1st day of the budget year;
(C) that delay reduces the amount of enti-
tlement authority that is subject to sequestra-
tion in the budget; and
(D) the uniform percentage otherwise ap-
plicable to the budget-year sequestration of a
program or activity is increased due to the
delay;
then it shall revert to the uniform percentage cal-
culated under paragraph (3) when the budget year
is completed.
(6) INDEXED BENEFIT PAYMENTS.—If, under
any entitlement program—
(A) benefit payments are made to persons
or governments more frequently than once a
year; and
(B) the amount of entitlement authority is
periodically adjusted under existing law to re-
flect changes in a price index (commonly called
‘‘cost of living adjustments’’);
sequestration shall first be applied to the cost of liv-
ing adjustment before reductions are made to the
base benefit. For the first fiscal year to which a se-
questration order applies, the benefit payment re-
ductions in such programs accomplished by the
order shall take effect starting with the payment
made at the beginning of January following a final
sequester order. For the purposes of this subsection
Veterans Compensation shall be considered a pro-
gram that meets the conditions of the preceding sen-
tence.
(7) LOAN PROGRAMS.—For all loans made, ex-
tended or otherwise modified on or after the date of
sequestration, under loan programs subject to direct
spending caps—
(A) the sequestrable base shall be total
fees associated with all loans made extended or
otherwise modified on or after the date of se-
questration; and
(B) the fees paid by borrowers shall be in-
creased by a uniform percentage sufficient to
produce the dollar savings in such loan pro-
grams for the fiscal year or years of the seques-
trations required by this section.
Notwithstanding any other provision of law, in any
year in which a sequester is in effect, all subsequent
fees shall be increased by the uniform percentage
and all proceeds from such fees shall be paid into
the general fund of the Treasury.
(8) INSURANCE PROGRAMS.—Any sequestration
in a Federal program that sells insurance contracts
to the public (including the Federal Crop Insurance
Fund, the National Insurance Development Fund,
the National Flood Insurance fund, insurance activi-
ties of the Overseas Private Insurance Corporation,
and Veterans’ Life insurance programs) shall be ac-
complished by increasing premiums on contracts en-
tered into extended or otherwise modified, after the
date a sequestration order takes effect by the uni-
form sequestration percentage. Notwithstanding any
other provision of law, for any year in which a se-
quester affecting such programs is in effect, subse-
quent premiums shall be increased by the uniform
percentage and all proceeds from the premium in-
crease shall be paid from the insurance fund or ac-
count to the general fund of the Treasury.
tion 204 and programs subject to special rules
set forth under section 205 and notwithstand-
ing any other provisions of law, any sequestra-
tion required under this Act shall reduce benefit
levels by an amount sufficient to eliminate all
excess spending identified in the report issued
pursuant to section 201, while maintaining the
same uniform percentage reduction in the mon-
etary value of benefits subject to reduction
under this subsection.
(c) WITHIN SESSION SEQUESTER.—If a bill or reso-
lution providing direct spending for a fiscal year in
progress is enacted before July 1 of that fiscal year and
causes a breach within a direct spending cap or caps for
that fiscal year, 15 days later there shall be a sequestra-
tion to eliminate that breach within that cap or caps fol-
lowing the procedures set forth in subsection (a).
SEC. 204. EXEMPT PROGRAMS AND ACTIVITIES.
The following budget accounts, activities within ac-
counts, or income shall be exempt from sequestration—
(1) net interest;
(2) all payments to trust funds from excise
taxes or other receipts or collections properly cred-
itable to those trust funds;
(3) offsetting receipts and collections;
(4) all payments from one Federal direct spend-
ing budget account to another Federal budget ac-
count;
(5) all intragovernmental funds including those
from which funding is derived primarily from other
Government accounts;
(6) expenses to the extent they result from pri-
vate donations, bequests, or voluntary contributions
to the Government;
(7) nonbudgetary activities, including but not
limited to—
(A) credit liquidating and financing ac-
counts;
(B) the Pension Benefit Guarantee Cor-
poration Trust Funds;
(C) the Thrift Savings Fund;
(D) the Federal Reserve System; and
(E) appropriations for the District of Co-
lumbia to the extent they are appropriations of
locally raised funds;
(8) payments resulting from Government insur-
ance, Government guarantees, or any other form of
contingent liability, to the extent those payments re-
sult from contractual or other legally binding com-
mitments of the Government at the time of any se-
questration;
(9) the following accounts, which largely fulfill
requirements of the Constitution or otherwise make
payments to which the Government is committed—
Bureau of Indian Affairs, miscellaneous
trust funds, tribal trust funds (14–9973–0–7–
999);
Claims, defense;
Claims, judgments and relief act (20–
1895–0–1–806);
Compact of Free Association, economic as-
sistance pursuant to Public Law 99-658 (14–
0415–0–1–806);
Compensation of the President (11–0001–
0–1–802);
Customs Service, miscellaneous permanent
appropriations (20–9992–0–2–852);
Eastern Indian land claims settlement
fund (14–2202–0–1–806);
Farm Credit System Financial Assistance
Corporation, interest payments (20–1850–0–1–
351);
Internal Revenue collections of Puerto Rico
(20–5737–0–2–852);
Payments of Vietnam and USS Pueblo
prisoner-of-war claims (15–0104–0–1–153):
Payments to copyright owners (03–5175–
0–2–376);
Salaries of Article III judges (not including
cost of living adjustments);
Soldier’s and Airman’s Home, payment of
claims (84–8930–0–7–705);
Washington Metropolitan Area Transit Au-
thority, interest payments (46–0300–0–1–401);
(10) the following noncredit special, revolving,
or trust-revolving funds—
Exchange Stabilization Fund (20–4444–0–
3–155); and
Foreign Military Sales trust fund (11–
82232–0–7–155).
(j) OPTIONAL EXEMPTION OF MILITARY PERSON-
NEL.—
(1) The President may, with respect to any
military personnel account, exempt that account
from sequestration or provide for a lower uniform
percentage reduction that would otherwise apply.
(2) The President may not use the authority
provided by paragraph (1) unless he notifies the
Congress of the manner in which such authority will
be exercised on or before the initial snapshot date
for the budget year.
SEC. 205. SPECIAL RULES.
(a) CHILD SUPPORT ENFORCEMENT PROGRAM.—
Any sequestration order shall accomplish the full amount
of any required reduction in payments under sections 455
and 458 of the Social Security Act by reducing the Fed-
eral matching rate for State administrative costs under
the program, as specified (for the fiscal year involved) in
section 455(a) of such Act, to the extent necessary to re-
duce such expenditures by that amount.
(b) COMMODITY CREDIT CORPORATION.—
(1) EFFECTIVE
DATE.—For the Commodity
Credit Corporation, the date on which a sequestra-
tion order takes effect in a fiscal year shall vary for
each crop of a commodity. In general, the sequestra-
tion order shall take effect when issued, but for each
crop of a commodity for which 1-year contracts are
issued as an entitlement, the sequestration order
shall take effect with the start of the sign-up period
for that crop that begins after the sequestration
order is issued. Payments for each contract in such
a crop shall be reduced under the same terms and
conditions.
(2) DAIRY PROGRAM.—
(A) As the sole means of achieving any re-
duction in outlays under the milk price-support
program, the Secretary of Agriculture shall pro-
vide for a reduction to be made in the price re-
ceived by producers for all milk in the United
States and marketed by producers for commer-
cial use.
(B) That price reduction (measured in
cents per hundred-weight of milk marketed)
shall occur under subparagraph (A) of section
201(d)(2) of the Agricultural Act of 1949 (7
U.S.C. 1446(d)(2)(A)), shall begin on the day
any sequestration order is issued, and shall not
exceed the aggregate amount of the reduction
in outlays under the milk price-support pro-
gram, that otherwise would have been achieved
by reducing payments made for the purchase of
milk or the products of milk under this sub-
section during that fiscal year.
(3) EFFECT OF DELAY.—For purposes of sub-
section (b)(1), the sequestrable base for Commodity
Credit Corporation is the current-year level of gross
outlays resulting from new budget authority that is
subject to reduction under paragraphs (1) and (2).
within 30 days, the plan submitted by the Postmaster
General shall go into effect. Any plan may be later revised
by the submission of a new plan to the Postal Rate Com-
mission, which may approve or modify it.
(j) POWER
MARKETING
ADMINISTRATIONS
AND
T.V.A.— Any sequestration of the Department of Energy
power marketing administration funds or the Tennessee
Valley Authority fund shall be accomplished by annual
payments from those funds to the General Fund of the
Treasury, and the administrators of those funds shall have
the duty to make those payments during the fiscal year
to which the sequestration order applies and each succeed-
ing fiscal year. The amount of each payment by a fund
shall be—
(1) the direct spending uniform sequestration
percentage, times
(2) the estimated gross obligations of the fund
in that year other than those obligations financed
from discretionary appropriations for that year.
Any such payment for a fiscal year shall be made as soon
as possible during the fiscal year, except that it may be
made in installments within that year if the payment
schedule is approved by the Secretary of the Treasury. An-
nual payments by a fund may be financed by reductions
in costs required to produce the pre-sequester amount of