Cyclopedia of Congressional Budget Law
Holman Rule
Summary
The Holman Rule is a rule in the United States House of Representatives that allows amendments to appropriations legislation that would reduce the salary of or fire specific federal employees, or cut a specific program. The rule was first enacted in 1876 and rescinded in 1983, and was reinstated in January 2017 by section 3(a) of H. Res. 5 (115th Congress) on a temporary basis, in clause 2 of rule XXI of the Rules of the House. The rule excepted certain legislative language, otherwise prohibited on appropriation bills, for “germane provisions that retrench expenditures by the reduction of amounts of money covered by the bill.”
Separate Order for the Holman Rule: Section 3 of H. Res. 5 (115th Congress)
SEC. 3. SEPARATE ORDERS.
(a) Holman Rule.—During the first session of the One Hundred Fifteenth Congress, any reference in clause 2 of rule XXI to a provision or amendment that retrenches expenditures by a reduction of amounts of money covered by the bill shall be construed as applying to any provision or amendment (offered after the bill has been read for amendment) that retrenches expenditures by—
(1) the reduction of amounts of money in the bill;
(2) the reduction of the number and salary of the officers of the United States; or
(3) the reduction of the compensation of any person paid out of the Treasury of the United States.
Notes from the House Rules and Manual (115th Congress):
§1043. History of clause 2 of rule XXI.
The 25th Congress in 1837 was the first to adopt a rule prohibiting appropriations in a general appropriation bill or amendment thereto not previously authorized by law, in order to prevent delay of appropriation bills because of contention over propositions of legislation. In 1838 that Congress added the exception to permit unauthorized appropriations for continuation of works in progress and for contingencies for carrying on departments of the Government. The rule remained in that form until the 44th Congress in 1876, when William S. Holman of Indiana persuaded the House to amend the rule to permit germane legislative retrenchments. In 1880, the 46th Congress dropped the exception that permitted unauthorized appropriations for contingencies of Government departments, and modified the “Holman Rule” to define retrenchments as the reduction of the number and salary of officers of the United States, the reduction of compensation of any person paid out of the Treasury of the United States, or the reduction of the amounts of money covered by the bill. That form of the retrenchment exception remained in place until the 49th Congress in 1885, when it was dropped until the 52d Congress in 1891, and then reinserted through the 53d Congress until 1894. It was again dropped in the 54th Congress from 1895 until reinserted in the 62d Congress in 1911 (IV, 3578; VII, 1125).
“HOLMAN RULE” ON RETRENCHING EXPENDITURES
§1062. Legislation reducing expenditures.
Decisions under the so-called “Holman Rule” in clause 2 of rule XXI have been rare in the modern practice of the House. The trend in construing language in general appropriation bills or amendments thereto has been to minimize the importance of the “Holman Rule” in those cases in which the decision can be made on other grounds. The practice of using limitations in appropriation bills has been perfected in recent years so that most modern decisions by the Chair deal with distinctions between such limitations and matters that are considered to be legislation (see §§1053–1057, supra). Under the modern practice, the “Holman Rule” only applies where an obvious reduction is achieved by the provision in question and does not apply to limiting language unaccompanied by a reduction of funds in the bill (July 16, 1979, pp. 18808–10). It has no application to an amendment to an appropriation bill that does not legislate but is merely a negative limitation citing but not changing existing law (June 18, 1980, p. 15355).
A paragraph containing legislation reported in an appropriation bill to be in order must on its face show a retrenchment of a type that conforms to the requirements of the rule (Mar. 17, 1926, p. 5804).
The reduction of expenditure must appear as a necessary result, in order to bring an amendment or provision within the exception to the rule. It is not sufficient that such reduction would probably, or would in the opinion of the Chair, result therefrom (IV, 3887; VII, 1530–1534). Thus, an amendment to a general appropriation bill providing that appropriations made in that act are hereby reduced by $7 billion, though legislative in form, was held in order under the “Holman Rule” exception (Apr. 5, 1966, p. 7689), but an amendment providing for certain reductions of appropriations carried in the bill based on the President’s budget estimates was held not to show a reduction on its face and to provide merely speculative reductions (Deschler, ch. 26, §5.6; June 24, 1992, p. 16110). An amendment authorizing the President to reduce each appropriation in the bill by not more than 10 percent was ruled out as legislation conferring new authority on the President (May 31, 1984, p. 14617; June 6, 1984, p. 15120). An amendment reducing an unauthorized amount permitted to remain in a general appropriation bill is in order as a retrenchment under this clause (Oct. 1, 1975, p. 31058). An amendment to a general appropriation bill denying the availability of funds to certain recipients but requiring Federal officials to make additional determinations as to the qualifications of recipients is legislation and is not a retrenchment of expenditures where it is not apparent that the prohibition will reduce the amounts covered by the bill (June 26, 1973, p. 21389).
The amendment must not only show on its face an attempt to retrench but also must be germane to some provision in the bill even though offered by direction of the committee having jurisdiction over the subject matter of the amendment (VII, 1549; Dec. 16, 1911, p. 442). An amendment providing that appropriations “herein and heretofore made” shall be reduced by $70 million through the reduction of Federal employees as the President determines was held to be legislative and not germane to the bill, because it went to funds other than those carried therein, and was therefore not within the “Holman Rule” exception (Oct. 18, 1966, p. 27425).
An amendment reducing an amount in an appropriation bill for the Postal Service and prohibiting the use of funds therein to implement special bulk third-class rates for political committees was held in order because not specifically requiring a new determination and because constituting a retrenchment of expenditures even if assumed to be legislative (July 13, 1979, pp. 18453–55).
As long as an amendment calls for an obvious reduction at some point in time during the fiscal year, the amendment is in order under the “Holman Rule” even if the reduction takes place in the future in an amount actually determined when the reduction takes place (for example, by formula) (VII, 1491, 1505; July 30, 1980, pp. 20499–20503). To an amendment that is in order under the “Holman Rule,” containing legislation but retrenching expenditures by formula for every agency funded by the bill, an amendment exempting from that reduction several specific programs does not add further legislation and is in order (July 30, 1980, pp. 20499–20503).
A motion to recommit the District of Columbia appropriation bill with instructions to reduce the proportion of the fund appropriated from the Federal Treasury from one-half, as provided in the bill, to one-fourth of the entire appropriation is in order, because the effect of the amendment if adopted would reduce the expenditure of public money although not reducing the amount of the appropriation (VII, 1518).
The term “retrenchment” means the reduction of the amount of money to be taken out of the Federal Treasury by the bill, and therefore a reduction of the amount of money to be contributed toward the expenses of the District of Columbia is in order as a retrenchment (VII, 1502).
An amendment proposed to an item for the recoinage of uncurrent fractional silver, which amendment struck out the amount appropriated and added a provision for the coinage of all the bullion in the Treasury into standard silver dollars, the cost of such coinage and recoinage to be paid out of the Government’s seigniorage, was held not to be in order under the rule; first, because not germane to the subject matter of the bill (the sundry civil); second, because it did not appear that any retrenchment of expenditure would result, the seigniorage being the property of the Government as other funds in the Treasury (VII, 1547).
To an item of appropriation for inland transportation of mails by star routes an amendment was offered requiring the Postmaster General to provide routes and make contracts in certain cases, with the further provision “and the amount of appropriation herein for star routes is hereby reduced to $500.” A point of order made against the first or legislative part of the amendment was sustained, which decision was, on appeal, affirmed by the committee (VII, 1555).
To a clause appropriating for the foreign mail service an amendment reducing the appropriation, and in addition repealing the act known as the “subsidy act,” was held not in order because the repealing of this act was not germane to the appropriation bill; and that to be in order both branches of the amendment must be germane to the bill (VII, 1548).
A provision in the agricultural appropriation bill transferring the supervision of the importation of animals from the Treasury to the Department of Agriculture is out of order, being a provision changing law and not retrenching expenditure (IV, 3886).
Where a paragraph containing new legislation provides in one part for a discharge of employees, which means a retrenchment, and in another part embodies legislation to bring about the particular retrenchment that in turn shows on its face an expenditure the amount of which is not apparent, the Chair is unable to hold that the net result will retrench expenditures. However, where the additional legislation does not show on its face an additional expenditure, the Chair will not speculate as to a possible expenditure under the additional legislation (VII, 1500).
As explained in the annotation in §1043, supra, the amendment of clause 2(b) in the 98th Congress narrowed the “Holman Rule” exception to the general prohibition against legislation to cover only retrenchments reducing amounts of money covered by the bill, and not retrenchments resulting from reduction of the number and salary of officers of the United States or of the compensation of any person paid out of the U.S. Treasury. Accordingly, the Chair held out of order an amendment mandating the reduction of certain Federal salaries and expenses as not confined to a reduction of funds in the bill (June 17, 1994, p. 13422). Paragraph (b) also eliminated separate authority conferred upon legislative committees or commissions with proper jurisdiction to report amendments retrenching expenditures, and permitted legislative committees to recommend such retrenchments by reduction of amounts covered by the bill to the Appropriations Committee for discretionary inclusion in the reported bill. Paragraph (d) as added in the 98th Congress provides a new procedure for consideration of all retrenchment amendments only when reading of the bill has been completed and only if the Committee of the Whole does not adopt a motion to rise and report the bill back to the House. Other decisions that involved interpretation of the “Holman Rule,” but which do not reflect the current form or interpretation of that rule, are found in IV, 3846, 3885–3892; VII, 1484, 1486–1492, 1498, 1500, 1515, 1563, 1564, 1569; June 1, 1892, p. 4920.
CRS Report: Holman Rule (House Rule XXI, Clause 2(b)) (R44736 January 13, 2017)
“Holman Rule”
Although congressional rules establish a general division of responsibility under which questions of policy are kept separate from questions of funding, House rules provide for exceptions in certain circumstances. One such circumstance allows for the inclusion of legislative language in general appropriations bills or amendments thereto for “germane provisions that retrench expenditures by the reduction of amounts of money covered by the bill.” This exception appears in clause 2(b) of House Rule XXI and is known as the Holman rule, after Representative William Holman of Indiana, who first proposed the exception in 1876.
Since the period immediately after its initial adoption, the House has interpreted the Holman rule through precedents that have tended to incrementally narrow its application. Under current precedents, for a legislative provision or amendment to be in order, the legislative language in question must be both germane to other provisions in the measure and must produce a clear reduction of appropriations in that bill.
In addition, the House has also adopted a separate order for the first session of the 115th Congress that provides that retrenchments of expenditures by a reduction of amounts of money covered by the bill shall be construed as applying to:
any provision or amendment that retrenches expenditures by—
(1) the reduction of amounts of money in the bill;
(2) the reduction of the number and salary of the officers of the United States; or
(3) the reduction of the compensation of any person paid out of the Treasury of the United States.
This report provides a history of this provision in House rules and an analysis of precedents that are illustrative of its possible application.
Section-by-Section from the 115th Congress for H. Res. 5
Section 3. Separate Orders
Holman Rule. Subsection (a) provides a new standing order for the first session of the 115th Congress based on the ‘‘Holman Rule,’’ most of which was removed from the standing rules in 1983. This standing order functions as an exception to clause 2 of rule XXI to allow provisions changing law in certain limited circumstances. Under this order, a provision in a general appropriation bill or an amendment thereto may contain legislation to retrench expenditures by (1) reducing amounts of money in the bill, (2) reducing the number or salaries of Federal employees, or (3) reducing the compensation of any person paid by the Treasury. To qualify for treatment under this order, an amendment must be offered after the reading of the bill and must comply with all applicable rules of the House, such as the germaneness rule. The purpose of this provision is to see if the reinstatement of the Holman rule will provide Members with additional tools to reduce spending during consideration of the regular general appropriation bills.
Reference
CRS – Holman Rule (House Rule XXI, Clause 2(b)) (R44736) January 13, 2017
“How a 141-year-old rule could revolutionize the budget process” (The Hill) May 17, 2017
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