§ 12.2
Deschler’s Notes on Former Section 402
Congressional Budget Act of 1974

Deschler’s Precedents Notes  

Provisions Constituting New Spending Authority

§ 12.2 Language in a bill authorizing receipts from loans made under prior foreign assistance legislation to be made available for designated purposes was held not to be ‘‘new spending authority’’ within the meaning of section 401 of the Congressional Budget Act [of 1974][1] (requiring the budget authority for contracts and indebtedness to be provided in advance by appropriation acts), where it was shown from the term ‘‘authorized’’ and from the committee report that the amounts of repaid loans were subject to the appropriations process before the funds could be expended.

On Sept. 10, 1975,[2] the following occurred:  


Mr. [Robert] BAUMAN [of Maryland]. Mr. Speaker, I have a parliamentary inquiry. The SPEAKER.[3] The gentleman will state it.

Mr. BAUMAN. If the gentleman from Maryland is disposed to make a point of order against the consideration of this bill because of any provisions it contains contrary to Public Law 93–344, the Budget Control Act, when would that point of order lie?

The SPEAKER. It will depend on when the motion is made to go into the Committee of Whole. It would lie at the time the motion is made.

Mr. BAUMAN. Mr. Speaker, then I would like to make a point of order.

The SPEAKER. As soon as the gentleman from Pennsylvania (Mr. MORGAN), makes his motion, the Chair will recognize the gentleman.



 Mr. [Thomas] MORGAN [of Pennsylvania]. Mr. Speaker, I move that the House resolve itself into the Committee of the Whole House on the State of the Union for the consideration of the bill (H.R. 9005) to authorize assistance for disaster relief and rehabilitation, to provide for overseas distribution and production of agricultural commodities, to amend the Foreign Assistance Act of 1961, and for other purposes.


Mr. BAUMAN. Mr. Speaker, I make a point of order against the present consideration of the bill H.R. 9005 on the grounds that on page 15 of this bill, in section 302(e),[4] lines 6 to 17, there is contained a provision which in essence changes the law governing repayments on previous foreign assistance loans making these sums available for certain purposes without reappropriation by Congress. At the present time the proceeds from repayments of these loans are returned to the Treasury for later reappropriation by the Congress.

Apparently this provision allows at least $200 million in loan reflows, as the report refers to them, to be respent without either authorization or further appropriation by the Congress each year.

It would be my contention that this provision violates Public Law 93–344, section 401(a), the Congressional Budget Act of 1974, which in effect prohibits the consideration by the House of any bill or resolution which provides any new spending authority. In effect this is backdoor spending without authorization and appropriation each year by the Congress.

The SPEAKER. Does the gentleman from Pennsylvania desire to be heard on the point of order?

Mr. MORGAN. I do, Mr. Speaker.

Mr. Speaker, I rise in opposition to the point of order.

Mr. Speaker, the proposed section 103 of the Foreign Assistance Act of 1961 contained in section 301(a) of House Resolution 905 as reported, which authorizes the repayment on prior year foreign aid loans to be made available for specific purposes, does not in effect appropriate funds and, therefore, is not subject to a point of order under clause 5 of rule XXI. The funds referred to in section 103 will not be available for reuse unless they are appropriated.

The committee does not intend that these funds be exempt from the appropriation process, as can be seen from the following language. The clear language of the bill, Mr. Speaker, proposed in section 103 specifically provides that amounts repaid are authorized to be available for use and authorized for appropriation. It does not provide that they be available for use as an appropriation.

The SPEAKER. The Chair would like to address a question to the gentleman from Maryland.

Is the gentleman raising a point of order under the Budget Act for the purpose of preventing the consideration of the legislation, or is he attempting to make a point of order that this is an appropriation on a legislative bill?

Mr. BAUMAN. Mr. Speaker, I am making the point of order for the express purpose of preventing the consideration of the bill, inasmuch as the public law to which I have referred says that it shall not be in order for either House to consider a bill which contains such a provision.

I would, therefore, in response to the statement of the chairman of the committee, refer to the committee report on page 46 which says:

The third subsection added to section 103 authorizes repayments on prior year aid loans to be made available for specified purposes.

This would remove it from the appropriation process.

The SPEAKER. The Chair is ready to rule. The gentleman from Maryland is making the point of order that the portion of the bill under section 302(e) constitutes new spending authority and violates section 401(a) of the Budget Act, Public Law 93–344.

The Chair has reviewed the language shown in the bill and in the report which shows that it is subject to the appropriation process because the whole intent and thrust is predicated on the words ‘‘are authorized to be made available.’’ In other words, the reflow funds are to be appropriated by the Committee on Appropriations and by subsequent legislative actions and not as a result of the passage of this bill.

The Chair, therefore, overrules the point of order.

Mr. BAUMAN. Mr. Speaker, if I may be heard further, my contention was that this particular provision in and of itself authorizes the continuing appropriation each year, as the report indicates that it does, and that section 401(a) of Public Law 93–344 prevents consideration of any bill which permits that.

The SPEAKER. If that is true, this is still not in violation of 401. This is still an ‘‘authorization’’ subject to action each year of the Committee on Appropriations.

The Chair overrules the point of order.

[1] 2 USC §651. The Budget Enforcement Act of 1997 collapsed the original section 402 point of order into section 401 and repealed the definition of ‘‘new spending authority.’’ Although the types of spending authority covered by this section of the Congressional Budget Act have changed, the principle that a mere authorization remains subject to further appropriation of funds remains applicable.

[2] 121 CONG. REC. 28270, 28271, 94th Cong. 1st Sess. See also Deschler-Brown Precedents Ch. 31 § 4.2, supra.

[3] Carl Albert (OK).

[4] The provision at issue is as follows: ‘‘Dollar receipts from loans made pursuant to this part and from loans made under predecessor foreign assistance legislation are authorized to be made available for each of the fiscal years 1976 and 1977 for use, in addition to funds otherwise available for such purposes, for the purposes of supporting the activities of the proposed International Fund for Agricultural Development (a total of $200,000,000 of such receipts may be used only for such purpose), undertaking agricultural research in accordance with section 103A, and making loans for other activities under this section. Such amounts shall remain available until expended.’’

[Deschler-Brown- Johnson- Sullivan Precedents of the U.S. House of Representatives, Volume 18, Chapter 41.]