One Percent Spending Reduction Act of 2014

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``One Percent Spending Reduction Act 
of 2014''.

SEC. 2. CONGRESSIONAL FINDINGS AND PURPOSE.

    (a) Findings.--Congress finds the following:
            (1) The fiscal crisis faced by the Federal Government 
        demands immediate action.
            (2) The dramatic growth in spending and debt in recent 
        years threatens our economic and national security:
                    (A) Federal spending has grown from 18 percent of 
                GDP in 2001 to over 20 percent of GDP in 2014.
                    (B) Total Federal debt exceeds $17,000,000,000,000 
                and is projected to increase each year over the next 10 
                years.
                    (C) Without action, the Federal Government will 
                continue to run massive deficits in the next decade and 
                total Federal debt will rise to $27,000,000,000,000 by 
                2024.
                    (D) Interest payments on this debt will soon rise 
                to the point where balancing the budget as a matter of 
                policy is beyond the reach of Congress.
            (3) Due to recent tax hikes, Federal revenues are scheduled 
        to rise to approximately 18 percent of GDP, inline with the 
        average of about 18 percent of GDP over the past 40 years.
            (4) Absent reform, the growth of Social Security, Medicare, 
        Medicaid, and other health-related spending will overwhelm all 
        other Federal programs and consume all projected tax revenues.
    (b) Purpose.--The purpose of this Act is to address the fiscal 
crisis by--
            (1) acting quickly to balance the Federal budget and 
        eliminate the parade of deficits and ballooning interest 
        payments;
            (2) achieving balance by reducing spending one percent per 
        year until spending equals projected long-term revenues; and
            (3) reforming entitlement programs to ensure long-term 
        fiscal stability and balance.

SEC. 3. ESTABLISHMENT AND ENFORCEMENT OF SPENDING CAPS.

    (a) Outlay Caps.--The Balanced Budget and Emergency Deficit Control 
Act of 1985 (2 U.S.C. 900 et seq.) is amended by inserting after 
section 253 the following:

``SEC. 253A. ESTABLISHING OUTLAY CAPS.

    ``(a) Outlay Caps.--In this section, the term `outlay cap' means:
            ``(1) Fiscal year 2015.--For fiscal year 2015, the 
        aggregate outlays (less net interest payments) shall be 
        $3,774,000,000,000, less one percent.
            ``(2) Fiscal year 2016.--For fiscal year 2016, the 
        aggregate outlays (less net interest payments) shall be the 
        amount computed under paragraph (1), less one percent.
            ``(3) Fiscal year 2017.--For fiscal year 2017, the 
        aggregate outlays (less net interest payments) shall be the 
        amount computed under paragraph (2), less one percent.
            ``(4) Fiscal year 2018 and subsequent fiscal years.--
                    ``(A) In general.--For fiscal year 2018 and each 
                fiscal year thereafter, the aggregate outlays shall be 
                18 percent of the gross domestic product for that 
                fiscal year, as estimated by the Office of Management 
                and Budget prior to March of the previous fiscal year.
                    ``(B) Limitation.--Notwithstanding subparagraph 
                (A), for any fiscal year beginning with fiscal year 
                2019, the aggregate projected outlays may not be less 
                than the aggregate projected outlays for the preceding 
                fiscal year.
    ``(b) Sequestration.--
            ``(1) In general.--
                    ``(A) Excess spending.--Not later than 45 calendar 
                days after the beginning of a fiscal year, the Office 
                of Management and Budget shall prepare and the 
                President shall order a sequestration to eliminate any 
                excess outlay amount.
                    ``(B) Definitions.--
                            ``(i) Fiscal years 2015 through 2017.--For 
                        each of fiscal years 2015 through 2017 and for 
                        purposes of this subsection, the term `excess 
                        outlay amount' means the amount by which total 
                        projected Federal outlays (less net interest 
                        payments) for a fiscal year exceeds the outlay 
                        cap for that fiscal year.
                            ``(ii) Fiscal year 2018 and subsequent 
                        fiscal years.--For fiscal year 2018 and each 
                        fiscal year thereafter and for purposes of this 
                        subsection, the term `excess outlay amount' 
                        means the amount by which total projected 
                        Federal outlays for a fiscal year exceeds the 
                        outlay cap for that fiscal year.
            ``(2) Sequestration.--
                    ``(A) CBO preview report.--On August 15 of each 
                year, the Congressional Budget Office shall issue a 
                sequestration preview report as described in section 
                254(c)(4).
                    ``(B) OMB preview report.--On August 20 of each 
                year, the Office of Management and Budget shall issue a 
                sequestration preview report as described in section 
                254(c)(4).
                    ``(C) Final report.--On October 31 of each year, 
                the Office of Management and Budget shall issue its 
                final sequestration report as described in section 
                254(f)(3). It shall be accompanied by a Presidential 
                order detailing uniform spending reductions equal to 
                the excess outlay amount as defined in this section.
                    ``(D) Process.--The reductions shall generally 
                follow the process set forth in sections 253 and 254, 
                except as provided in this section.
            ``(3) Congressional action.--If the August 20 report by the 
        Office of Management and Budget projects a sequestration, the 
        Committee on the Budget of the Senate and the Committee on the 
        Budget of the House of Representatives may report a resolution 
        directing committees of their House to change the existing law 
        to achieve the spending reductions outlined in the August 20 
        report necessary to meet the outlay limits.
    ``(c) No Exempt Programs.--Section 255 and section 256 shall not 
apply to this section or any sequestration order issued under this 
section, except that payments for net interest (budget function 900) 
shall be exempt from the spending reductions under sequestration.
    ``(d) Look Back.--If, after November 14, a bill resulting in 
outlays for the fiscal year in progress is enacted that causes excess 
outlays, the excess outlay amount for the next fiscal year shall be 
increased by the amount or amounts of that breach.''.
    (b) Conforming Amendments to BBEDCA.--
            (1) Sequestration preview reports.--Section 254(c)(4) of 
        the Balanced Budget and Emergency Deficit Control Act of 1985 
        (2 U.S.C. 904(c)(4)) is amended to read as follows:
            ``(4) Outlay cap sequestration reports.--The preview 
        reports shall set forth for the budget year estimates for the 
        following:
                    ``(A)(i) For each of budget years 2015 through 
                2017, the aggregate projected outlays (less net 
                interest payments), less one percent.
                    ``(ii) For budget year 2018 and each subsequent 
                budget year, the estimated gross domestic product (GDP) 
                for that budget year.
                    ``(B) The amount of reductions required under 
                section 253A.
                    ``(C) The sequestration percentage necessary to 
                achieve the required reduction under section 253A.''.
            (2) Final sequestration reports.--Section 254(f)(3) of the 
        Balanced Budget and Emergency Deficit Control Act of 1985 (2 
        U.S.C. 904(f)(3)) is amended to read as follows:
            ``(3) Outlay caps sequestration reports.--The final reports 
        shall contain all the information required in the outlay cap 
        sequestration preview reports. In addition, these reports shall 
        contain, for the budget year, for each account to be 
        sequestered, estimates of the baseline level of sequestrable 
        budgetary resources and resulting outlays and the amount of 
        budgetary sources to be sequestered and result in outlay 
        reductions. The reports shall also contain estimates of the 
        effects on outlays on the sequestration of each outyear for 
        direct spending programs.''.
    (c) Enforcement.--Title III of the Congressional Budget Act of 1974 
(2 U.S.C. 631 et seq.) is amended by adding after section 315 the 
following:

``SEC. 316. ENFORCEMENT PROCEDURES.

    ``(a) Outlay Caps.--It shall not be in order in the House of 
Representatives or the Senate to consider any bill, joint resolution, 
amendment, amendment between the Houses, or conference report that 
includes any provision that would cause the most recently reported, 
current outlay cap set forth in section 253A of the Balanced Budget and 
Emergency Deficit Control Act of 1985 to be breached.
    ``(b) Waiver or Suspension.--
            ``(1) In the senate.--The provisions of this section may be 
        waived or suspended in the Senate only by the affirmative vote 
        of two-thirds of the Members, duly chosen and sworn.
            ``(2) In the house.--The provisions of this section may be 
        waived or suspended in the House of Representatives only by a 
        rule or order proposing only to waive such provisions by an 
        affirmative vote of two-thirds of the Members, duly chosen and 
        sworn.
    ``(c) Point of Order Protection.--In the House, it shall not be in 
order to consider a rule or order that waives the application of 
paragraph (2) of subsection (b).
    ``(d) Motion To Suspend.--It shall not be in order for the Speaker 
to entertain a motion to suspend the application of this section under 
clause 1 of rule XV.''.

SEC. 4. CONFORMING AMENDMENTS.

    The table of contents set forth in--
            (1) section 1(b) of the Congressional Budget and 
        Impoundment Control Act of 1974 is amended by inserting after 
        the item relating to section 315 the following new item:

``Sec. 316. Enforcement procedures.'';
        and
            (2) section 250(a) of the Balanced Budget and Emergency 
        Deficit Control Act of 1985 is amended by inserting after the 
        item relating to section 253 the following new item:

``Sec. 253A. Establishing outlay caps.''.

SEC. 5. EFFECTIVE DATE.

    This Act and the amendments made by this Act shall apply to fiscal 
year 2015 and each fiscal year thereafter, including any reports and 
calculations required for implementation in fiscal year 2015.

Summary: One Percent Spending Reduction Act of 2014 - Amends the Balanced Budget and Emergency Deficit Control Act of 1985 (Gramm-Rudman-Hollings Act) to establish and enforce new spending caps. Establishes the aggregate outlay cap (less net interest payments) for FY2015 at $3.774 trillion, less 1%. Reduces the outlay cap for FY2016-FY2017 by 1% of the previous fiscal year's outlay cap. Requires the outlay cap for FY2018 and subsequent fiscal years to be 18% of the gross domestic product (GDP) for that fiscal year as estimated by the Office of Management and Budget (OMB). Prohibits outlays from being less than those for the preceding fiscal year for any fiscal year beginning with FY2019. Requires OMB to enforce the spending caps using a sequestration to eliminate any excess spending through automatic cuts. Eliminates most exemptions from sequestration.    Permits the budget committees to report a resolution directing the committees of their respective chambers to change existing law to achieve the spending reductions necessary to meet the outlay limits if a sequestration is projected.   Amends the Congressional Budget Act of 1974 to create procedures for the House and Senate to enforce the outlay caps established in this Act.