I
106TH CONGRESS
1ST SESSION
H. R. 2293
To reform the budget process.
IN THE HOUSE OF REPRESENTATIVES
JUNE 22, 1999
Mr. BARTON of Texas (for himself and Mr. STENHOLM) introduced the fol-
lowing bill; which was referred to the Committee on the Budget, and in
addition to the Committees on Rules, and Appropriations, for a period
to be subsequently determined by the Speaker, in each case for consider-
ation of such provisions as fall within the jurisdiction of the committee
concerned
A BILL
To reform the budget process.
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
‘‘Budget Enforcement Act of 1999’’.
(b) TABLE OF CONTENTS.—
Sec. 1. Short title and table of contents.
Sec. 2. Definitions.
TITLE I—A SINGLE BUDGET FOR THE UNITED STATES
GOVERNMENT
Sec. 101. Statement of purpose.
Sec. 102. Safeguards against delay.
Sec. 103. Binding budget law.
Sec. 104. Budget required before spending bills may be considered.
Sec. 105. Lock box amendment.
Sec. 106. Technical amendments.
Sec. 107. Timetable.
Sec. 108. Procedures to avoid sequestration.
Sec. 109. Effect on Presidents’ budget submissions; point of order.
Sec. 110. Direct Spending Caps.
Sec. 111. Economic assumptions.
Sec. 112. 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. Sequestration rules.
Sec. 204. Exempt programs and activities.
Sec. 205. Special rules.
Sec. 206. The current law baseline.
Sec. 207. Limitations on emergency spending.
Sec. 208. Ten-year congressional review requirement of permanent budget au-
thority.
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,
United States Code, 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) APPROPRIATION ACT.—The term ‘‘appro-
priation Act’’ means an Act referred to in section
105 of title 1, United States Code.
(19) DEFICIT.—The term ‘‘deficit’’ means, with
respect to a fiscal year, the amount by which total
outlays exceed total receipts during that year.
(20) SURPLUS.—The term ‘‘surplus’’ means,
with respect to a fiscal year, the amount by which
total receipts exceed total outlays during that year.
(21) DIRECT SPENDING CAPS.—The term ‘‘di-
rect spending caps’’ means the nominal dollar limits
for entitlements and other mandatory spending pur-
suant to section 110, as adjusted pursuant to section
112.
TITLE I—A SINGLE BUDGET FOR
THE 
UNITED 
STATES 
GOV-
ERNMENT
SEC. 101. STATEMENT OF PURPOSE.
(a) The Federal budget process is the principal vehi-
cle by which many of the most fundamental policy choices
in Government are made. The purpose of this Act is to
facilitate rational, informed, and timely decisions and to
enforce the expenditure levels contained in the budget.
(b) The Federal budget process should focus atten-
tion on the aggregate impact of Federal fiscal policy on
the economy, on public priorities, and on the tradeoffs that
must be made among priorities to control overall levels of
spending. To this end the Act is intended to establish a
budget process that, in each fiscal period—
(1) requires adoption of a budget before Con-
gress considers expenditures for individual pro-
grams, activities and functions of government;
(2) encourages agreement between Congress
and the President, with regard to broad fiscal policy
objectives and the allocation of public resources
among broad categories of expenditure;
(3) ties subsequent spending decisions to bind-
ing budget limits;
(4) holds Congress and the President account-
able for expenditure limits contained in the budget
until and unless they change the law to change the
limits; and
(5) produces a bias in favor of fiscal responsi-
bility that can be overcome only if Congress and the
President act constructively to do so.
SEC. 102. SAFEGUARDS AGAINST DELAY.
(a) To avoid temporary shutdowns of the Federal
Government, chapter 13 of title 31, United States Code,
is amended by inserting after section 1310 the following
new section:
‘‘§ 1311. Automatic continuing resolution
‘‘(a) If any appropriation Act as defined in section
105 of title 1 has not become law by the beginning of a
fiscal period, the automatic continuing resolution provided
for in this section shall take effect immediately. The auto-
matic continuing resolution shall remain in effect for the
entirety of the fiscal period, unless amended in whole or
in part, by enactment of an appropriation Act or Acts.
If the automatic continuing resolution shall take effect,
then there is hereby appropriated out of any moneys in
the Treasury not otherwise appropriated, an amount equal
to 95 percent of budget authority for each program,
project or activity regularly provided for under that appro-
priation bill in the most recent fiscal period. In no case
shall the total dollar amount of appropriations for any pro-
gram, project or activity pursuant to an automatic con-
tinuing resolution exceed 95 percent of the fixed dollar ap-
propriation for such program, project or activity in the
most recent appropriation Act, determined on a fiscal year
basis. Budget authority and outlays provided subject to
any automatic continuing resolution shall be subject to all
expenditure limits and enforcement provisions contained
in all laws in effect for the fiscal period.
‘‘(b) Any automatic continuing resolution enacted
pursuant to this section shall be subject to the same ap-
portionment and other rules as apply to any other con-
tinuing resolution making appropriations.’’.
SEC. 103. BINDING BUDGET LAW.
(a) To encourage early consultation and cooperation
between Congress and the President on decisions con-
cerning overall spending levels for all Federal programs,
projects, and activities and to provide for one budget for
the Government of the United States, Congress shall
enact, and the President shall sign, a binding budget law,
in the form of a joint resolution, by May 15 of the cal-
endar year in which the beginning of a new fiscal period
commences. The budget law shall fit on one page. It shall
set—
(1) budget authority and outlays for the major
functional categories for the budget year and 5 sub-
sequent years, except for disbursements of the old
age, survivors, and disability insurance program es-
tablished under title II of the Social Security Act;
(2) annual limits for budget authority an out-
lays for discretionary and mandatory programs, ac-
tivities, and accounts, with the exception of social se-
curity program disbursements and interest, for the
budget year and 5 subsequent years;
(3) appropriate levels for receipts and surpluses
or deficits for the budget year and 5 subsequent
years, not including receipts and disbursements of
the old age, survivors, and disability insurance pro-
gram established under title II of the Social Security
Act and related provisions of the Internal Revenue
Code of 1986;
(4) nonsocial security budget totals for the
budget year and for 5 subsequent years, including—
(A) budget authority and outlays;
(B) receipts; and
(C) surpluses, deficits, debt held by the
public; debt subject to limitation, and changes
in debt subject to limitation;
(5) for Social Security, which is by law ‘‘off-
budget’’, the budget shall identify separately annual
estimates for disbursements, receipts, and surpluses
or deficits for the budget year, and for 5 subsequent
years; and
(6) unified budget totals for the budget year
and for 5 subsequent years for budget authority and
outlays; receipts; and surpluses or deficits.
(b) The expenditure limits contained in the one-page
budget pursuant to this section shall include direct spend-
ing caps pursuant to section 110 of this Act and discre-
tionary spending limits pursuant to the most recently en-
acted legislation containing statutory spending limits. If
SEC. 107. TIMETABLE.
On or before:
Action to be completed:
January 15 ....................................
CBO economic and budget update.
First Monday in February ............
President’s budget update based on
new assumptions.
April l5 ..........................................
House and Senate complete action on
the Budget.
May l0 ............................................
House and Senate complete action on
the Conference Agreement on the
Budget.
May l5 ............................................
President signs or vetos the Con-
ference Agreement on the Budget.
August l .........................................
CBO and OMB updates.
August l5 .......................................
Preview report.
Not later than November 1 (and
as soon as practical after the
end of the fiscal year).
OMB and CBO Analyses of Deficits,
Revenues and Spending Levels and
Projections for the Upcoming Year.
November 1–December l5 .............
Congressional action to avoid seques-
tration.
December 15 ..................................
OMB issues final (look back) report
for prior year and preview for cur-
rent year.
December 15 ..................................
Presidential sequester order or order.
SEC. 108. PROCEDURES TO AVOID SEQUESTRATION.
(a) SPECIAL MESSAGE.—If the OMB Analysis of Ac-
tual Spending Levels and Projections for the Upcoming
Year, issued pursuant to section 201, indicates that out-
lays in the most recently completed fiscal year exceeded,
or outlays in the current year are projected to exceed, the
caps in section 110, as adjusted pursuant to section 112,
the President shall submit to Congress with the OMB
Analysis of Actual Spending Levels and Projections for
the Upcoming Year a special message that includes pro-
posed legislative changes to—
(1) offset all or part of outlay excess; or
(2) revise the outlay caps contained in this Act.
(b) INTRODUCTION
OF
THE PRESIDENT’S PACK-
AGE.—Not later than November 15, the message from the
President required pursuant to subsection (a) shall be in-
troduced as a joint resolution in the House of Representa-
tives or the Senate by the chairman of its Committee on
the Budget. If the chairman fails to do so, after November
15, the joint resolution may be introduced by any Member
of that House of Congress and shall be referred to the
Committee on the Budget of that House.
(c) HOUSE COMMITTEE ACTION.—The Committee on
the Budget, in consultation with the committees of juris-
diction, shall, by November 15, report a joint resolution
containing—
(1) the recommendations in the President’s
message, or different policies and proposed legisla-
tive changes than those contained in the message of
the President, to ameliorate or eliminate any excess
expenditures, or
(2) any changes to expenditure caps contained
in this Act, except that any changes to the expendi-
ture caps cannot be greater than the changes rec-
ommended in the message submitted by the Presi-
dent.
(d) PROCEDURE IF THE APPROPRIATE COMMITTEE
OF THE HOUSE OF REPRESENTATIVES FAILS TO REPORT
REQUIRED RESOLUTION.—
(1) AUTOMATIC
DISCHARGE
OF
COMMITTEES
ON THE BUDGET OF THE HOUSE.—If the Committee
on the Budget of the House of Representatives fails,
by November 20, to report a resolution meeting the
requirements of subsection (c), the committee shall
be automatically discharged from further consider-
ation of the joint resolution reflecting the Presi-
dent’s recommendations introduced pursuant to sub-
section (a), and the joint resolution shall be placed
on the appropriate calendar.
(2) CONSIDERATION
OF
DISCHARGE
RESOLU-
TION IN THE HOUSE.—If the Committee has been
discharged under paragraph (1) above, any Member
may move that the House of Representatives con-
sider the resolution. Such motion shall be highly
privileged and not debatable. It shall not be in order
to consider any amendment to the resolution except
amendments which are germane and which do not
change the net outlay impact of the resolution.
(e) CONSIDERATION OF JOINT RESOLUTIONS IN THE
HOUSE.—Consideration of resolutions reported pursuant
to subsection (c) or (d) shall be pursuant to the procedures
set forth in section 305 of the Congressional Budget Act
of 1974 and subsection (d). Notwithstanding subsection
(d) and any other rule or order of the House of Represent-
atives or the Senate, it shall be in order to consider
amendments to ameliorate any excess spending through
different policies and proposed legislation and which do
not change the net outlay impact of the resolution.
(f) TRANSMITTAL TO SENATE.—If a joint resolution
passes the House of Representatives pursuant to sub-
section (e), the Clerk of the House of Representatives shall
cause the resolution to be engrossed, certified, and trans-
mitted to the Senate within 1 calendar day of the day on
which the resolution is passed. The resolution shall be re-
ferred to the Senate Committee on the Budget.
(g) REQUIREMENTS FOR SPECIAL JOINT RESOLU-
TION IN THE SENATE.—The Committee on the Budget,
in consultation with the committees of jurisdiction shall
report not later than December 1—
(1) a joint resolution reflecting the message of
the President; or
(2) the joint resolution passed by the House of
Representatives, with or without amendment; or
(3) a joint resolution containing different poli-
cies and proposed legislative changes than those con-
tained in either the message of the President or the
resolution passed by the House of Representatives,
to eliminate all or part of any excess expenditures,
or
(4) any changes to the expenditure caps con-
tained in this Act, except that any changes to the
expenditure caps cannot be greater than the changes
recommended in the message submitted by the
President.
(h) PROCEDURE IF THE APPROPRIATE COMMITTEE
OF THE SENATE FAILS TO REPORT REQUIRED RESOLU-
TION.—(1) In the event that the Committee on the Budget
of the Senate fails, by December 1, to report a resolution
meeting the requirements of subsection (g), the committee
shall be automatically discharged from further consider-
ation of the joint resolution reflecting the President’s rec-
ommendations introduced pursuant to subsection (a) and
of the resolution passed by the House of Representatives,
and both joint resolutions shall be placed on the appro-
priate calendar.
(2) Any member may move that the Senate consider
the resolution passed by the House of Representatives or
the resolution introduced pursuant to subsection (b).
(i) CONSIDERATION OF JOINT RESOLUTION IN THE
SENATE.—Consideration of resolutions reported pursuant
to subsections (c) or (d) shall be pursuant to the proce-
dures set forth in section 305 of the Congressional Budget
Act of 1974 and subsection (d).
(j) PROCEDURE IF JOINT RESOLUTION DOES NOT
ELIMINATE EXCESS.—If the joint resolution reported by
the Committee on the Budget pursuant to subsection (c)
or (g) or a joint resolution discharged in the House of
Representatives or the Senate pursuant to subsection
(d)(1) or (h) would eliminate less than the entire amount
by which actual or projected outlays exceed the caps con-
tained in this Act;
then the Committee on the Budget of the Senate shall re-
port a joint resolution, raising the outlay caps, for any
year in which actual or projected spending would not con-
form to the expenditure caps in section 110.
(k) CONFERENCE REPORTS SHALL FULLY ADDRESS
EXCESS.—It shall not be in order in the House of Rep-
resentatives or the Senate to consider a conference report
on a joint resolution to eliminate all or part of any excess
outlays compared to the expenditure caps contained in sec-
tion 110, unless—
(1) the joint resolution offsets the entire
amount of any overage; or
(2) the House of Representatives and Senate
both pass the joint resolution reported pursuant to
subsection (j).
The vote on any resolution reported pursuant to sub-
section (j) shall be solely on the subject of changing the
expenditure limits in section 110.
SEC. 109. EFFECT ON PRESIDENTS’ BUDGET SUBMISSIONS;
POINT OF ORDER.
(a) BUDGET SUBMISSION.—Any budget submitted by
the President pursuant to section 1105(a) of title 31,
United States Code, for each of fiscal years 1999 through
2003 shall be consistent with the spending levels estab-
lished in section 110, as adjusted pursuant to section 112,
or it shall recommend changes to those levels.
(b) POINT OF ORDER.—It shall not be in order in
the House of Representatives or the Senate to consider
any concurrent resolution on the budget unless it is con-
sistent with the spending levels established in section 110,
as adjusted pursuant to section 112.
SEC. 110. DIRECT SPENDING CAPS.
(a) IN GENERAL.—Effective upon submission of the
report by OMB pursuant to subsection (c), direct spending
caps shall apply to all entitlement authority except for un-
distributed offsetting receipts and net interest outlays,
subject to adjustments for changes in eligible populations
and inflation pursuant to section 112. For purposes of en-
forcing direct spending caps under this Act, each separate
program shown in the table set forth in subsection (d)
shall be deemed to be a category.
(b) BUDGET COMMITTEE REPORTS.—Within 30 days
after enactment of this Act, the Budget Committees of
the House of Representatives and the Senate shall file
with their respective Houses identical reports containing
account numbers and spending levels for each specific cat-
egory.
(c) REPORT BY OMB.—Within 30 days after enact-
ment of this Act, OMB shall submit to the President and
each House of Congress a report identical to the reports
in subsection (b) containing account numbers and spend-
ing limits for each specific category.
(d) CONTENTS OF REPORTS.—All direct spending ac-
counts not included in these reports under separate cat-
egories shall be included under the heading ‘‘Other Enti-
tlements and Mandatory Spending’’. These reports may
include adjustments among the caps set forth in this Act
as required below, however the aggregate amount available
under the ‘‘Total Entitlements and Other Mandatory
Spending’’ cap shall be identical in each such report and
in this Act and shall be deemed to have been adopted as
part of this Act. Each such report shall include the actual
amounts of the caps for each year of fiscal years 2001
through 2006 consistent with the concurrent resolution on
the budget for fiscal year 1999 for each of the following
categories:
Earned Income Tax Credit,
Family Support,
Civilian and other Federal retirement:
Military retirement,
Food stamps,
Medicaid,
Medicare,
Social Security,
Supplemental security income,
Unemployment compensation,
Veterans’ benefits,
Other entitlements and mandatory spending,
and
Aggregate entitlements and other mandatory
spending.
(e) ADDITIONAL SPENDING LIMITS.—Legislation en-
acted subsequent to this Act may include additional caps
to limit spending for specific programs, activities, or ac-
counts with these categories. Those additional caps (if
any) shall be enforced in the same manner as the limits
set forth in such joint explanatory statement.
SEC. 111. 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
110, any breaches of such caps, and actions necessary to
remedy such breaches shall be based upon the economic
assumptions set forth in the joint explanatory statement
of managers accompanying the most recently enacted joint
resolution on the budget. At the same time as the submis-
sion of the report by OMB pursuant to section 110(c),
OMB shall submit to the President and Congress a report
setting forth the economic assumptions in the joint explan-
atory statement of managers accompanying the joint reso-
lution on the budget for fiscal year 2001 and the assump-
tions regarding eligible populations used in preparing the
report submitted pursuant to section 110(c).
SEC. 112. 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, and upon submission of
the OMB report pursuant to section 201(a) for any year,
OMB shall calculate (in the order set forth below), and
the budget and reports shall include, adjustments to the
direct spending caps (and those limits as cumulatively ad-
justed) for the current year, the budget year, and each
outyear, to reflect the following:
(1) 
ADJUSTMENTS
TO
DIRECT
SPENDING
CAPS.—
(A) CHANGES IN CONCEPTS AND DEFINI-
TIONS.—The adjustments produced by changes
in concepts and definitions shall equal the base-
line 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 in
concepts and definitions may only be made in
consultation with the Committees on Appropria-
tions, the Budget, and Government Reform and
Oversight and Governmental Affairs of the
House of Representatives and the Senate.
(B) CHANGES IN NET OUTLAYS.—Changes
in net outlays for all programs and activities ex-
empt from sequestration under section 204.
(C) CHANGES IN INFLATION.—For direct
spending under laws and policies enacted or ef-
fective on or before July 1, 2000, inflation ad-
justment factors shall equal the ratio between
the level of year-over-year change in the Con-
sumer Price Index measured for the fiscal year
most recently completed and the applicable esti-
mated level for that year as described in section
111 (relating to economic assumptions). For di-
rect spending under laws and policies enacted
or effective after July 1, 2000, there shall be no
adjustment to the direct spending caps (for
changes in economic conditions including infla-
tion, nor for changes in numbers of eligible
beneficiaries) unless—
(i) the Act or the joint explanatory
statement of managers accompanying such
Act providing new direct spending includes
economic projections and projections of
numbers of beneficiaries; and
(ii) such Act specifically provides for
automatic adjustments to the direct spend-
ing caps in section 110 based on those pro-
jections.
(D) 
CHANGES
IN
ELIGIBLE
POPU-
LATIONS.—For direct spending under laws and
policies enacted or effective on or before July 1,
2000, the direct spending caps shall be adjusted
to reflect changes in eligible populations, based
on the assumptions set forth in the OMB report
submitted pursuant to section 111. In making
such adjustments, OMB shall estimate the
changes in spending resulting from the change
in eligible populations. For direct spending
under laws and policies enacted or effective
after July 1, 1998, there shall be no adjustment
to the direct spending caps for changes in num-
bers of eligible beneficiaries unless—
(i) the Act or the joint explanatory
statement of managers accompanying such
Act providing new direct spending includes
economic projections and projections of
numbers of beneficiaries; and
(ii) such Act specifically provides for
automatic adjustments to the direct spend-
ing caps in section 110 based on those pro-
jections.
(E) INTRA-BUDGETARY PAYMENTS.—From
discretionary 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 110 may be revised as follows: Except as required
pursuant to subsection (a), direct spending caps may only
be adjusted 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 DEFICIT, REVENUE, AND
SPENDING LEVELS.—As soon as practicable after any fis-
cal year, OMB shall compile a statement of actual and
projected deficits, revenues, and direct spending for that
year and the current fiscal year. The statement shall iden-
tify such spending by categories contained in section 110.
(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 deficits, revenues,
or spending in the current or immediately preceding fiscal
years in violation of the direct spending caps in section
110, as adjusted pursuant to section 112, by more than
one-tenth of one percent of the applicable direct spending
for such year. The report shall include:
(1) The amount, if any, that total direct spend-
ing exceeded, or is projected to exceed, the aggregate
direct spending cap in section 110, as adjusted pur-
suant to section 112.
(2) All instances in which actual direct spend-
ing has exceeded the applicable direct spending cap.
(3) 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.
(4) The amounts by which direct spending shall
be reduced in the current fiscal year to offset the net
amount that actual direct spending in the preceding
fiscal year and projected direct spending in the cur-
rent fiscal year exceeds the amounts available for
each cap category.
SEC. 202. ENFORCING DIRECT SPENDING CAPS.
(a) PURPOSE.—This subtitle provides enforcement of
the direct spending caps on categories of spending estab-
lished pursuant to section 110. This section shall apply
for any fiscal year in which the statement provided under
section 201 identifies actual direct spending in the pre-
ceding fiscal year or projected direct spending in the cur-
rent year in excess of the aggregate direct spending cap,
as adjusted pursuant to section 112.
(b) GENERAL 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.
(3) 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.
(4) 
CANCELLATION
OF
BUDGETARY
RE-
SOURCES.—Budgetary resources sequestered from
any account other than a trust, special or revolving
fund shall revert to the Treasury and be perma-
nently canceled.
(5) IMPLEMENTING
REGULATIONS.—Notwith-
standing any other provision of law, administrative
rules or similar actions implementing any sequestra-
tion shall take effect within 30 days after that se-
questration.
SEC. 203. SEQUESTRATION RULES.
(a) 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 in the preceding fiscal year and projected
direct spending subject to the caps in the current
fiscal year exceeds the total of aggregate caps for di-
rect spending for the current and immediately pre-
ceding fiscal year.
(2) 
CALCULATION
OF
REDUCTIONS.—The
amount to be sequestered from direct spending pro-
grams under each separate cap shall be determined
by multiplying the total amount that direct spending
in that category exceeded or is projected to exceed
the direct spending cap for that category by—
(A) the net amount that total direct spend-
ing exceeded, or is projected to exceed, the ag-
gregate spending caps, as identified pursuant to
paragraph 201(b)(1); multiplied by
(B) the net amount that direct spending by
which the category exceeded and is projected to
exceed the direct spending cap for that cat-
egory, divided by the net amount that total
spending exceeded and is projected to exceed
the applicable direct spending cap for all cat-
egories in which spending exceeds the applicable
direct spending caps.
(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 the uniform percentage shall revert to the uni-
form percentage calculated 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 applies, the benefit payment reductions
in such programs accomplished by the order shall
take effect starting with the payment made at the
beginning of January following a final sequester.
For the purposes of this subsection, veterans’ com-
pensation shall be considered a program that meets
the conditions of the preceding sentence.
(7) LOAN PROGRAMS.—For all loans made, ex-
tended, or otherwise modified on or after any se-
questration 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-
tion 205 and programs subject to special rules
set forth under section 206 and notwith-
standing any other provisions of law, any se-
questration required under this Act shall reduce
benefit levels by an amount sufficient to elimi-
nate all excess spending identified in the report
issued pursuant to section 201, while maintain-
ing the same uniform percentage reduction in
the monetary value of benefits subject to reduc-
tion under this subsection.
(b) WITHIN-SESSION SEQUESTER.—If a bill or reso-
lution providing direct spending for the current year is en-
acted before July 1 of that fiscal year and causes a breach
within any direct spending cap for that fiscal year, 15 days
later there shall be a sequestration to eliminate that
breach within that cap.
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).
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) CERTAIN
AUTHORITY
NOT
TO
BE
LIM-
ITED.—Nothing in this Act shall restrict the Cor-
poration in the discharge of its authority and re-
sponsibility as a corporation to buy and sell com-
modities in international trade, or limit or reduce in
any way any appropriation that provides the Cor-
poration with funds to cover its realized losses.
(c) EARNED INCOME TAX CREDIT.—
(1) The sequestrable base for earned income
tax credit program is the dollar value of all current
year benefits to the entire eligible population.
(2) In the event sequestration is triggered to re-
duce earned income tax credits, all earned income
tax credits shall be reduced, whether or not such
credits otherwise would result in cash payments to
beneficiaries, by a uniform percentage sufficient to