§008. BPLA §206. BBEDCA Sec. 254 (PAR)(541-559)

BPLA (Contents)

Budget Process Law Annotated (1993)

Balanced Budget and Emergency Deficit Control Act of 1985

[PAGES 541-559]
SEC. 254.1412 reports and orders.

(a)1413 Timetable.— The timetable with respect to this part for any budget year1414 is as follows:

Date: Action to be completed:
January 21……………………….. Notification regarding optional adjustment of maximum deficit amount.1415
5 days before the President’s budget……………….……………… CBO1416 sequestration1417 preview report, submission.
The President’s budget submission…………………………… OMB1418 sequestration preview report.
August 10………………………… Notification regarding military personnel.
August 15………………………… CBO sequestration update report.
August 20………………………… OMB sequestration update report.
10 days after end of session……… CBO final sequestration report.
15 days after end of session……… OMB final sequestration report; Presidential order.
30 days later………………………. GAO compliance report.

(b)1419 Submission and Availability of Reports.—Each report required by this section shall be submitted, in the case of CBO,1420 to the House of Representatives, the Senate and OMB1421 and, in the case of OMB, to the House of Representatives, the Senate, and the President on the day it is issued. On the following day a notice of the report shall be printed in the Federal Register.

[p.543]

(c) Optional Adjustment of Maximum Deficit Amounts.1422—With respect to budget year1423 1994 or 1995, on the date specified in subsection (a) the President shall notify the House of Representatives and the Senate of his decision regarding the optional adjustment of the maximum deficit amount (as allowed under section 253(g)(1)(B)).

(d) Sequestration1424 Preview Reports.—

(1) Reporting requirement.—On the dates specified in subsection (a), OMB1425 and CBO1426 shall issue a preview report regarding discretionary, pay-as-you-go, and deficit sequestration1427 based on laws enacted through those dates.

(2) Discretionary sequestration1428 report.—The preview reports shall set forth estimates for the current year1429 and each subsequent year through [p.544] 19981430 of the applicable discretionary spending limits1431 for each category1432 and an explanation of any adjustments in such limits under section 251.

(3) Pay-As-You-Go sequestration1433 reports.—The preview reports shall set forth, for the current year1434 and the budget year, 1435 estimates for each of the following:

(A) The amount of net deficit1436 increase or decrease, if any, calculated under subsection 252(b).

(B) A list identifying each law enacted and sequestration1437 implemented after the date of enactment of this section included in the calculation of the amount of deficit1438 increase or decrease and specifying the budgetary effect of each such law.

[p.545]

(C) The sequestration1439 percentage or (if the required sequestration percentage is greater than the maximum allowable percentage for medicare) percentages necessary to eliminate a deficit1440 increase under section 252(c).

(4) Deficit sequestration1441 reports.—The preview reports shall set forth for the budget year estimates for each of the following:

(A) The maximum deficit amount, the estimated deficit1444 calculated under section 253(b), the excess deficit, 1445 and the margin.

(B) The amount of reductions required under section 252, the excess deficit1446 remaining after those reductions have been made, and the amount of reductions required from defense accounts1447 and the reductions required from non-defense accounts.

[p.546]

(C) The sequestration1448 percentage necessary to achieve the required reduction in defense accounts1449 under section 253(d).

(D) The reductions required under sections 253(e)(l) and 253(e)(2).

(E) The sequestration1450 percentage necessary to achieve the required reduction in non-defense accounts1451 under section 253(e)(3).

The CBO1452 report need not set forth the items other than the maximum deficit amount1453 for fiscal year 1992, 1993, or any fiscal year for which the President notifies the House of Representatives and the Senate that he will adjust the maximum deficit amount under the option under section 253(g)(1)(B).

(5) Explanation of differences.—The OMB1454 reports shall explain the differences between [p.547] OMB and CBO1455 estimates for each item set forth in this subsection.

(e) Notification Regarding Military Personnel.—On or before the date specified in subsection (a), the President shall notify the Congress of the manner in which he intends to exercise flexibility with respect to military personnel accounts1456 under section 255(h).1457

(f) Sequestration1458 Update Reports.—On the dates specified in subsection (a), OMB1459 and CBO1460 shall issue a sequestration update report, reflecting laws enacted through those dates, containing all of the information required in the sequestration preview reports.

[p.548]

(g) Final Sequestration1461 Reports.—

(1) Reporting requirement.—On the dates specified in subsection (a), OMB1462 and CBO1463 shall issue a final sequestration1464 report, updated to reflect laws enacted through those dates.

(2) Discretionary sequestration1465 reports.—The final reports shall set forth estimates for each of the following:

(A) For the current year1466 and each subsequent year through 19981467 the applicable discretionary spending limits1468 for each category1469 and an explanation of any adjustments in such limits under section 251.

[p.549]

(B) For the current year1470 and the budget year1471 the estimated new budget authority1472 and outlays1473 for each category1474 and the breach, 1475 if any, in each category.

(C) For each category1476 for which a sequestration1477 is required, the sequestration percentages necessary to achieve the required reduction.

(D) For the budget year, 1478 for each account1479 to be sequestered,1480 estimates of the baseline1481 level of sequestrable budgetary resources1482 and resulting outlays1483 and the amount of [p.550] budgetary resources to be sequestered and resulting outlay reductions.

(3) Pay-as-you-go and deficit sequestration1484 reports.—The final reports shall contain all the information required in the pay-as-you-go and deficit sequestration preview reports. In addition, these reports shall contain, for the budget year, 1485 for each account1486 to be sequestered, 1487 estimates of the baseline1488 level of sequestrable budgetary resources1489 and resulting outlays1490 and the amount of budgetary resources to be sequestered and resulting outlay reductions. The reports shall also contain estimates of the effects on outlays of the sequestration in each outyear1491 through 19981492 for direct spending1493 programs.

[p.551]

(4) Explanation of differences.—The OMB1494 report shall explain any differences between OMB and CBO1495 estimates of the amount of any net deficit1496 change calculated under subsection 252(b), any excess deficit,1497 any breach, 1498 and any required sequestration1499 percentage. The OMB report shall also explain differences in the amount of sequesterable resources for any budget account1500 to be reduced if such difference is greater than $5,000,000.

(5) Presidential order.—On the date specified in subsection (a), if in its final sequestration1501 report OMB1502 estimates that any sequestration is required, the President shall issue an order fully implementing without change all sequestrations required by the OMB calculations set forth in that report. This order shall be effective on issuance.

[p.552]

(h) Within-Session Sequestration1503 Reports and Order.—If an appropriation for a fiscal year in progress is enacted (after Congress adjourns1504 to end the session for that budget year1505 and before July 1 of that fiscal year) that causes a breach,1506 10 days later CBO1507 shall issue a report containing the information required in paragraph (g)(2). Fifteen days after enactment, OMB1508 shall issue a report containing the information required in paragraphs (g)(2) and (g)(4). On the same day as the OMB report, the President shall issue an order fully implementing without change all sequestrations required by the OMB calculations set forth in that report. This order shall be effective on issuance.

(i) GAO Compliance Report.—On the date specified in subsection (a), the Comptroller General shall submit to the Congress and the President a report on—

(1) the extent to which each order issued by the President under this section complies with all of the requirements contained in this part, either certifying that the order fully and accurately complies with such requirements or indicating the respects in which it does not; and

[p.553]

(2) the extent to which each report issued by OMB1509 or CBO1510 under this section complies with all of the requirements contained in this part, either certifying that the report fully and accurately complies with such requirements or indicating the respects in which it does not.

(j) Low-Growth Report.—At any time, CBO1511 shall notify the Congress if—

(1) during the period consisting of the quarter during which such notification is given, the quarter preceding such notification, and the 4 quarters following such notification, CBO or OMB1512 has determined that real economic growth1513 is projected or estimated to be less than zero with respect to each of any 2 consecutive quarters within such period;1514 or

[p.554]

(2) the most recent of the Department of Commerce’s advance preliminary or final reports of actual real economic growth1515 indicate that the rate of real economic growth for each of the most recently reported quarter and the immediately preceding quarter is less than one percent. 1516

[p.555]

(k) Economic And Technical Assumptions.—In all reports required by this section, OMB1517 shall use the same economic and technical assumptions as used in the most recent budget submitted by the President under section 1105(a) of title 31, United States Code.1518 

1412. Section 254 is codified as amended at 2 US.C. § 904 (Supp. IV 1992), amended by the Omnibus Budget Reconciliation Act of 1993, Pub. L 103-66, §§14002(c)(2) and 14003(b), 107 Stat. 312 (1993). Section 13101(a) of the Budget Enforcement Act of 1990 amended section 254 to read substantially as it does now. See infra p. 701. For excerpts from the statement of managers accompanying the conference report on the Budget Enforcement Act of 1990 explaining section 254, see infra note 1518.

1413. Before enactment of the Budget Enforcement Act of 1990, section 254(a) dealt with special procedures in the event of low economic growth. Section 13101(a) of the Budget Enforcement Act of 1990 repealed the old section 254(a). See infra p. 701. Section 13101(f) of the Budget Enforcement Act of 1990 (see infra p. 705) added a new section 258 to the Balanced Budget and Emergency Deficit Control Act of 1985 (see infra pp. 619-630) based on the old section 254(a) to deal with special procedures in the event of low economic growth. For the text of the old section 254(a), see infra note 1705.

1414. Section 250(c)(12) defines “budget year”. See supra p.446.

1415. Section 250(c)(1) (see supra p. 440) defines “maximum deficit amount’ by adopting the definition of section 601(a)(1) of the Congressional Budget Act of 1974 (see supra p. 299) as adjusted under sections 251 and 253 of the Balanced Budget and Emergency Deficit Control Act of 1985. See supra pp. 475-502, 523-533.

1416. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1417. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1418. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1419. Before enactment of the Budget Enforcement Act of 1990, section 254(b) dealt with special fast-track reconciliation procedures in the Senate to respond to sequester orders. Section 13101(a) of the Budget Enforcement Act of 1990 repealed the old section 254(b). See infra p. 701. Section 13101(g) of the Budget Enforcement Act of 1990 (see infra p. 706) added a new section 258C to the Balanced Budget and Emergency Deficit Control Act of 1985 (see infra pp. 658-662) based on the old section 254(b) to deal with special fast-track reconciliation procedures in the Senate to respond to sequester orders. For the text of the old section 254(b), see infra note 1740.

1420. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1421. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1422. Section 250(c)(1) (see supra p. 440) defines “maximum deficit amount” by adopting the definition of section 601(a)(1) of the Congressional Budget Act of 1974 (see supra p.

1423. Section 250(c)(12) defines “budget year”. See supra p.446.

1424. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1425. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1426. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1427. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1428. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1429. Section 250(c)(13) defines “current year”. See supra p. 446.

1430. Section 14002(c)(2) of the Omnibus Budget Reconciliation Act of 1993, Pub. L. 103-66, §14002(c)(2), 107 Stat. 312 (1993), changed this reference from “1995” to “1998”. For legislative history of the extension, see supra notes 870 and 936 and infra note 1807.

1431. Section 250(c)(1) of the Balanced Budget and Emergency Deficit Control Act of 1985 (see supra p. 440) defines “discretionary spending limit by adopting the definition of section 601(a)(2) of the Congressional Budget Act of 1974(see supra pp. 301-303) as adjusted under sections 251 and 253 of the Balanced Budget and Emergency Deficit Control Act of 1985. See pp. 475-502, 523-533.

1432. Section 250(c)(4) defines “category.” see supra p. 441.

1433. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1434. Section 250(c)(13) defines “current year”. See supra p. 446.

1435. Section 250(c)(12) defines “budget year”. See supra p.446.

1436. Section 250(c)(1) (see supra p. 440) defines “deficit” at least in part by reference to the definition of section 3(6) of the Congressional Budget Act of 1974. See supra p. 16.

1437. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1438. Section 250(c)(1) (see supra p. 440) defines “deficit” at least in part by reference to the definition of section 3(6) of the Congressional Budget Act of 1974. See supra p. 16.

1439. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1440. Section 250(c)(1) (see supra p. 440) defines “deficit” at least in part by reference to the definition of section 3(6) of the Congressional Budget Act of 1974. See supra p. 16.

1441. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1442. Section 250(c)(12) defines “budget year”. See supra p.446.

1443. Section 250(c)(1) (see supra p. 440) defines “maximum deficit amount” by adopting the definition of section 601(a)(1) of the Congressional Budget Act of 1974 (see supra p. 299) as adjusted under sections 251 and 253 of the Balanced Budget and Emergency Deficit Control Act of 1985. See supra pp. 475-502, 523-533.

1444. Section 250(c)(1) (see supra p. 440) defines “deficit’ at least in part by reference to the definition of section 3(6) of the Congressional Budget Act of 1974. See supra p. 16.

1445. Section 253(b) defines the term “excess deficit”. See supra pp. 523-524.

1446. Section 253(b) defines the term “excess deficit”. See supra pp. 523-524.

1447. Section250(c)(11) defines “account”. See supra p.445.

1448. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1449. Section250(c)(11) defines “account”. See supra p.445.

1450. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1451. Section250(c)(11) defines “account”. See supra p.445.

1452. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1453. Section 250(c)(1) (see supra p. 440) defines “maximum deficit amount” by adopting the definition of section 601(a)(1) of the Congressional Budget Act of 1974 (see supra p. 299) as adjusted under sections 251 and 253 of the Balanced Budget and Emergency Deficit Control Act of 1985. See supra pp. 475-502, 523-533.

1454. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1455. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1456. Section 250(c)(11) defines “account”. See supra p. 445.

1457. See infra p. 576. This reference refers to the section 255(h) at the end of section 255, dealing with “Optional Exemption of Military Personnel” not the section 255(h) that preexisted the Budget Enforcement Act of 1990, dealing with “Low Income Programs.” see infra p. 576. Section 13101(c)(4) of the Budget Enforcement Act of 1990 added the subsection (h) dealing with “Optional Exemption of Military Personnel” “at the end” of section 255. See infra p. 703. As section 13101(c)(4) of the Budget Enforcement Act of 1990 simply added the new subsection (h) at the end of section 255 and did not amend the existing subsection (h) to read as the new subsection (h), Congress evidently wanted to add another subsection and not to repeal the existing subsection (h). As subsections (h) and (i) already existed, however, the Budget Enforcement Act of 1990 should have added a new subsection (j) at the end of section 255, or perhaps have inserted the new subsection (h) in place of the existing subsection (f), which at least some drafters of the Budget Enforcement Act of 1990 intended to repeal. The reference here then should have been to subsection (j) or subsection (f), as the case may have been.

1458. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1459. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1460. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1461. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1462. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1463. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1464. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1465. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1466. Section 250(c)(13) defines “current year”. See supra p. 446.

1467. Section 14002(c)(2) of the Omnibus Budget Reconciliation Act of 1993, Pub. L. 103-66, section 14002(c)(2), 107 Stat. 312 (1993), changed this reference from “1995” to “1998”. For legislative history of the extension, see supra notes 870 and 936 and infra note 807.

1468. Section 250(c)(1) of the Balanced Budget and Emergency Deficit Control Act of 1985 (see supra p. 440) defines “discretionary spending limit’ by adopting the definition of section 601(a)(2) of the Congressional Budget Act (see supra pp. 301-303) as adjusted under sections 251 and 253 of the Balanced Budget and Emergency Deficit Control Act of 1985. See supra pp. 475-502, 523-533.

1469. Section 250(c)(4) defines “category”. See supra p. 441.

1470. Section 250(c)(13) defines “current year”. See supra p. 446.

1471. Section 250(c)(12) defines “budget year”. See supra p.446.

1472. Section 250(c)(1) (see supra p. 440) defines “budget authority” and “new budget authority” at least in part by reference to the definitions of section 3(2) of the Congressional Budget Act of 1974. See supra pp. 11-13.

1473. Section 250(c)(1) (see supra p. 440) defines “outlays” at least in part by reference to the definition of section 3(1) of the Congressional Budget Act of 1974. See supra p. 11.

1474. Section 250(c)(4) defines “category”. See supra p. 441.

1475. Section 250(c)(3) defines “breach”. See supra p. 440.

1476. Section 250(c)(4) defines “category”. See supra p. 441.

1477. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1478. Section 250(c)(12) defines “budget year”. See supra p.446.

1479. Section250(c)(11) defines “account”. See supra p.445.

1480. Section 250(c)(2) defines “sequester”. See supra p. 440.

1481. Section 250(c) (see supra p.442) defines “baseline” in substantial part by reference to section 257. See infra pp. 600-617.

1482. Section 250(c)(6) defines “budgetary resources”. See supra p. 443.

1483. Section 250(c)(1) (see supra p. 440) defines “outlays” at least in part by reference to the definition of section 3(1) of the Congressional Budget Act of 1974. See supra p. 11.

1484. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1485. Section 250(c)(12) defines “budget year”. See supra p.446.

1486. Section 250(c)(11) defines “account”. See supra p. 445.

1487. Section 250(c)(2) defines “sequester”. See supra p. 440.

1488. Section 250(c) (see supra p.442) defines “baseline” insubstantial part by reference to section 257. See infra pp. 600-617.

1489. Section 250(c)(6) defines “budgetary resources”. See supra p. 443.

1490. Section 250(c)(1) (see supra p. 440) defines “outlays” at least in part by reference to the definition of section 3(1) of the Congressional Budget Act of 1974. See supra p. 11.

1491. Section 250(c)(14) defines “outyear”. See supra p. 446.

1492. Section 14003(b) of the Omnibus Budget Reconciliation Act of 1993, Pub. L No. 103-66, § 14003(b), 107 Stat. 312 (1993), changed this reference from “1995” to “1998”. For legislative history of the extension, see supra notes 870 and 936 and infra note 1807.

1493. Section 250(C)(8) defines “direct spending”. See supra p. 444.

1494. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1495. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1496. Section 250(c)(1) (see supra p. 440) defines “deficit’ at least in part by reference to the definition of section 3(6) of the Congressional Budget Act of 1974. See supra p. 16.

1497. Section 253(b) defines the term “excess deficit”. See supra pp. 523-524.

1498. Section 250(c)(3) defines “breach”. See supra p. 440.

1499. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1500. Section 250(c)(11) defines “account”. See supra p. 445.

1501. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1502. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1503. Section 250(c)(2) defines “sequestration”. See supra p. 440.

1504. What happens if the Congress recesses to end the first session of a Congress? Congress plainly intended to require annual review of legislation. This language should be read as “adjourns or recesses to end a session.”

1505. Section 250(c)(12) defines “budget year”. See supra p.446.

1506. Section 250(c)(3) defines “breach”. See supra p. 440.

1507. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1508. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1509. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1510. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1511. Section 250(c)(16) defines “CBO” to mean “the Director of the Congressional Budget Office”. See supra p. 446.

1512. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1513. Section 250(c)(10) defines “real economic growth”. See supra p. 445.

1514. Director of the Congressional Budget Office issued a letter under section 258(j)(1) on January 23, 1991, indicating that both his office and the Office of Management and Budget projected real growth to be less than zero for two consecutive quarters:

The Honorable Dan Quayle

President of the Senate

United States Senate

Washington, DC 20510

Dear Mr. President:

Under section 2540) of the The Balanced Budget and Emergency Deficit Control Act of 1985 (2 US.C. 9040)), the Congressional Budget Office must notify the Congress in the event of an economic downturn. The section reads in part:

…

This letter serves to notify the Congress that the Congressional Budget Office (CEO) and the Office of Management and Budget (OMB) project real economic growth to be less than zero with respect to the last quarter of calendar year 1990 and the first quarter of calendar year 1991. A letter from the Director of OMB informing CBO of the OMB forecast is enclosed.

Sincerely

Robert D. Reischauer

137 Cong. Rec. S1098 (daily ed. Jan. 23, 1991).

1515. Section 250(c)(10) defines ‘real economic growth.” see supra p. 445.

1516. The Director of the Congressional Budget Office issued a letter under section 258(j)(2) on April 30,1991, indicating that the Department of Commerce had reported that the rate of real economic growth was less than one percent for two consecutive quarters:

The Honorable Dan Quayle

President of the Senate

Washington, DC 20510

Dear Mr. President:

Under Section 254(j) of the Balanced Budget and Emergency Deficit Control Act of 19658(2 U.S.C. 904(J)), the Congressional Budget Office must notify the Congress in the event of an economic slowdown. The section reads in part:

…

This letter serves to notify the Congress that on April 26, 1991, the Department of Commerce’s advance report on the growth of real Gross National Product during the first calendar quarter of 1991 indicated that growth was less than 1.0 percent during that quarter and the preceding quarter.

Sincerely,

Robert D. Reischauer

Letter from Robert D. Reischauer to Vice President Dan Quayle (Apr. 30, 1991).

1517. Section 250(c)(15) defines “OMB” to mean “the Director of the Office of Management and Budget”. See supra p. 446.

1518. Section 13101(a) of the Budget Enforcement Act of 1990 amended section 254 to read as it does now. See infra p. 701. The statement of managers accompanying the conference report on the Budget Enforcement Act of 1990 explains section 254 generally:

V. sequestration reports and orders

Current Law

Under current law, the Directors of the Office of Management and Budget and the Congressional Budget Office issue initial and revised sequestration reports each year in August and October which estimate the baseline deficit for the fiscal year, determine whether the deficit target has been exceeded, and calculate the percentages and amounts by which spending in non-exempt accounts must be reduced to lower the estimated deficit to the target level.

The Office of Management and Budget Director’s initial and revised sequestration reports trigger initial and final presidential sequestration orders which implement any required sequestration reductions specified in the reports (the Congressional Budget Office reports are advisory). The General Accounting Office also issues a compliance report in November, which is also advisory. Through fiscal year 1992, a sequestration order is triggered if the baseline deficit exceeds the deficit target by more than $10 billion. For fiscal year 1993, when the target is zero, any deficit excess would trigger sequestration. The sequestration process expires at the end of fiscal year 1993. The [p.556] President’s sequestration orders must comply fully with the Office of Management and Budget Director’s reports.

Sequestration reports and orders are only in August and October each year. There are no procedures for issuing additional or revised reports and orders to eliminate any excess deficit that occurs after the sequestration process for a fiscal year has been completed. Further, if sequestration is triggered, it applies to all non-exempt accounts. The only categorization is that one-half of the reductions are made in defense programs, with the other half coming from non-defense programs. There are no separate or specialized reporting requirements or presidential orders for other categories of spending.

House Bill

The House bill establishes new sequestration reporting requirements and presidential sequestration orders to implement the discretionary spending sequester (enforcing the discretionary spending categories), the pay-as-you-go sequester (enforcing the deficit-neutrality of mandatory spending and receipt legislation), and the deficit sequester (enforcing the deficit targets).

The bill establishes the following timetable for sequestration reports and orders:

On or before Action to be completed
First Monday in February Lock in the Office of Management and Budget estimating assumptions.
August 15 Initial snapshot.
August 20 Sequester preview.
Latest possible date before October 15 Final snapshot.
October 15 Pay-as-you-go and deficit sequester reports; Presidential order.
Within 15 days after end of session Discretionary sequester reports; Presidential order.
30 days later GAO compliance report.

On August 20, both the Congressional Budget Office [p.557] and the Office of Management and Budget Directors issue sequester preview reports to the President and Congress for the pay-as-you-go and deficit sequesters for the fiscal year. For the pay-as-you-go sequester preview, the reports must set forth the change in the deficit for the fiscal year caused by the enactment of direct spending and receipts legislation, identify each law included in the estimate, and calculate the appropriate sequester percentage. For the deficit sequester, the reports must estimate the baseline deficit for the fiscal year, any deficit excess, the deficit margin, any deficit excess remaining after the pay-as-you-go sequester has been made, and calculate the specified reductions required to eliminate any remaining deficit excess.

On October 15, the Office of Management and Budget and Congressional Budget Office Directors issue revised pay-as-you-go and deficit sequester reports updated to reflect laws enacted through the final snapshot date and containing all the information required in the sequester preview reports. If the revised Office of Management and Budget report indicates that any pay-as-you-go and deficit sequester is required, the President shall issue an order on the same date implementing the sequester without change.

Within 15 days after the end of the session, the Congressional Budget Office and Office of Management and Budget Directors issue discretionary spending sequestration reports to the President and Congress. In general, the reports shall explain any adjustments made in the discretionary spending limits for budget authority and outlays for each fiscal year through fiscal year 1995, specify any breach in the discretionary categories for the current year and the budget year, and calculate the sequestration necessary to achieve the required reduction. If the Office of Management and Budget report indicates that any discretionary sequester is required, the President shall issue an order on the same date implementing the sequester without change.

Within 30 days of the issuance of the discretionary spending sequester report and order, the General Accounting Office (GAO) shall submit to the President and Congress a compliance report on all the sequester reports and orders issued for the fiscal year.

Senate Amendment

The Senate amendment provides that the estimates and determinations necessary to implement the new pay-as-you-go sequester and any deficit sequester shall be issued as part of the initial and revised sequestration reports required under current law. However, the Senate amendment changes the dates of submission for these reports. For the Congressional Budget Office, the initial sequestration report is due on January 27 (March 10 in years in which a new President is inaugurated) and the revised report is due on November 10 (the Congressional Budget Office reports remain advisory). For the Office of Management and Budget, the initial sequestration report is due [p.558] simultaneously with submission of the President’s budget-February 1 in most years, and March 15 in years in which a new President is inaugurated-and the revised report is due on November 15. An initial sequestration order would be issued simultaneously with the initial report and become effective on October 1. A final sequestration order would be effective November 15.

For discretionary spending sequestration, the Senate amendment requires both the Congressional Budget Office and the Office of Management and Budget to report to the President within 5 days after enactment of an appropriations act. The reports must determine whether any of the discretionary spending categories have been exceeded as a result of the act, and, if necessary, calculate the amounts and percentages by which spending in the affected categories must be reduced in the appropriate category to eliminate any excess. If the Office of Management and Budget report calculates a discretionary spending sequestration, the President must issue an order implementing the sequestration reductions-within 15 days if the measure is enacted before June 30, and on November 15 if the measure is enacted between June 30 and November 1.

Conference Agreement

As soon as possible after Congress completes action on a discretionary spending, direct spending, or revenue bill, and after consultation with the budget committees, the Congressional Budget Office (CBO) is to provide the Office of Management and Budget (OMB) with an estimate of the bill’s effect on spending and revenues. Within 5 days after the bill’s enactment, OMB transmits to the Congress its own estimate of the bill’s budgetary impact. OMB is required to explain differences between its estimates and those of CBO. OMB is also required to use its bill estimates in subsequent sequestration reports.

[p.559]

The timetable for sequestration reports and orders is as follows:

Date  Action
5 days before the budget  CBO sequestration preview report.
President’s budget submission  OMB sequestration preview report.
August 15  CBO sequestration update report.
August 20  OMB sequestration update report.
10 days after end of session  CBO final sequestration report.
15 days after end of session  OMB final sequestration report.
30 days later  GAO compliance report.

This timetable continues the feature of current law in which CBO issues its reports 5 days before OMB, and OMB is required to explain differences between its estimates and those of OMB.

All 3 sequestration reports will contain updated estimates of the maximum deficit amount and the discretionary spending limits for each category. They will also contain estimates of any net deficit increase or decrease (under the pay-as-you-go provisions), any excess deficit (compared to the deficit target), and the sequestration reductions and percentages necessary to eliminate a deficit increase or excess deficit. The final sequestration reports will include estimates of new budget authority and outlays for each discretionary spending category, the amounts of any breach in the discretionary spending limits, and the sequestration percentages necessary to eliminate a breach. In addition, the final reports will contain, for each budget account to be sequestered, estimates of the baseline level of sequestrable budgetary resources and outlays and the required reductions.

An extra pair of sequestration reports and an additional Presidential order will be required if, after the final sequestration report but before July 1, enactment of an appropriation bill causes a discretionary spending breach. These within-session sequestration reports are to contain the same information regarding discretionary spending as a final end-of-session sequestration report.

H.R. Conf. Rep. No. 101-964, 101st Cong., 2d Sess. 1157-60 (1990), reprinted in 1990 U.S.C.CA.N. 2374, 2862-65.

Previous:

Sec. 253 (BPLA)

Next:

Sec. 255 (BPLA)

 

FrillBreak