§196. Section 1026 – Definitions

Line Item Veto Act of 1996

Section 1026

TITLE X—IMPOUNDMENT CONTROL
PART C—LINE ITEM VETO
definitions

Sec. 1026.[1]  As used in this part:

(1) Appropriations law.—The term “appropriation law” means an Act referred to in section 105 of title 1, United States Code, including any general or special appropriation Act, or any Act making supplemental, deficiency, or continuing appropriations, that has been signed into law pursuant to Article I, section 7, of the Constitution of the United States.

(2) Calendar day.—The term “calendar day” means a standard 24-hour period beginning at midnight.

(3) Calendar days of sessions.—The term “calendar days of session” shall mean only those days on which both Houses of Congress are in session.

(4) Cancel.—The term “cancel” or “cancellation” means—

(A) with respect to any dollar amount of discretionary budget authority, to rescind;

(B) with respect to any item of new direct spending—

(i) that is budget authority provided by law (other than an appropriation law), to prevent such budget authority from having legal force or effect;

(ii) that is entitlement authority, to prevent the specific legal obligation of the United States from having legal force or effect; or

(iii) through the food stamp program, to prevent the specific provision of law that results in an increase in budget authority or outlays for that program from having legal force or effect; and

(C) with respect to a limited tax benefit, to prevent the specific provision of law that provides such benefit from having legal force or effect.

(5) Direct spending.—The term “direct spending” means—

(A) budget authority provided by law (other than an appropriation law);

(B) entitlement authority; and

(C) the food stamp program.

(6) Disapproval bill.—The term “disapproval bill” means a bill or joint resolution which only disapproves one or more cancellations of dollar amounts of discretionary budget authority, items of new direct spending, or limited tax benefits in a special message transmitted by the President under this part and—

(A) the title of which is as follows: “A bill disapproving the cancellations transmitted by the President on _______,” the blank space being filled in with the date of transmission of the relevant special message and the public law number to which the message relates;

(B) which does not have a preamble; and

(C) which provides only the following after the enacting clause: “That Congress disapproves of cancellations _______”, the blank space being filled in with a list by reference number of one or more cancellations contained in the President’s special message, “as transmitted by the President in a special message on _______”, the blank space being filled in with the appropriate date, “regarding _______.”, the blank space being filled in with the public law number to which the special message relates.

(7) Dollar amount of discretionary budget authority.—(A) Except as provided in subparagraph (B), the term “dollar amount of discretionary budget authority” means the entire dollar amount of budget authority—

(i) specified in an appropriation law, or the entire dollar amount of budget authority required to be allocated by a specific proviso in an appropriation law for which a specific dollar figure was not included;

(ii) represented separately in any table, chart, or explanatory text included in the statement of managers or the governing committee report accompanying such law;

(iii) required to be allocated for a specific program, project, or activity in a law (other than an appropriation law) that mandates the expenditure of budget authority from accounts, programs, projects, or activities for which budget authority is provided in an appropriation law;

(iv) represented by the product of the estimated procurement cost and the total quantity of items specified in an appropriation law or included in the statement of managers or[2]  the governing committee report accompanying such law; or

(v) represented by the product of the estimated procurement cost and the total quantity of items required to be provided in a law (other than an appropriation law) that mandates the expenditure of budget authority from accounts, programs, projects, or activities for which budget authority is provided in an appropriation law.

(B) The term “dollar amount of discretionary budget authority” does not include—

(i) direct spending;

(ii) budget authority in an appropriation law which funds direct spending provided for in other law;

(iii) any existing budget authority rescinded or canceled in an appropriation law; or

(iv) any restriction, condition, or limitation in an appropriation law or the accompanying statement of managers or committee reports on the expenditure of budget authority for an account, program, project, or activity, or on activities involving such expenditure.

(8) Item of new direct spending.—The term “item of new direct spending” means any specific provision of law that is estimated to result in an increase in budget authority or outlays for direct spending relative to the most recent levels calculated pursuant to section 257 of the Balanced Budget and Emergency Deficit Control Act of 1985.

(9) Limited tax benefit.—(A) The term “limited tax benefit” means—

(i) any revenue-losing provision which provides a Federal tax deduction, credit, exclusion, or preference to 100 or fewer beneficiaries under the Internal Revenue Code of 1986 in any fiscal year for which the provision is in effect; and

(ii) any Federal tax provision which provides temporary or permanent transitional relief for 10 or fewer beneficiaries in any fiscal year from a change to the Internal Revenue Code of 1986.

(B) A provision shall not be treated as described in subparagraph (A)(i) if the effect of that provision is that—

(i) all persons in the same industry or engaged in the same type of activity receive the same treatment;

(ii) all persons owning the same type of property, or issuing the same type of investment, receive the same treatment; or

(iii) any difference in the treatment of persons is based solely on—

(I) in the case of businesses and associations, the size or form of the business or association involved;

(II) in the case of individuals, general demographic conditions, such as income, marital status, number of dependents, or tax return filing status;

(III) the amount involved; or

(IV) a generally-available election under the Internal Revenue Code of 1986.

(C) A provision shall not be treated as described in subparagraph (A)(ii) if—

(i) it provides for the retention of prior law with respect to all binding contracts or other legally enforceable obligations in existence on a date contemporaneous with congressional action specifying such date; or

(ii) it is a technical correction to previously enacted legislation that is estimated to have no revenue effect.

(D) For purposes of subparagraph (A)—

(i) all businesses and associations which are related within the meaning of sections 707(b) and 1563(a) of the Internal Revenue Code of 1986 shall be treated as a single beneficiary;

(ii) all qualified plans of an employer shall be treated as a single beneficiary;

(iii) all holders of the same bond issue shall be treated as a single beneficiary; and

(iv) if a corporation, partnership, association, trust or estate is the beneficiary of a provision, the shareholders of the corporation, the partners of the partnership, the members of the association, or the beneficiaries of the trust or estate shall not also be treated as beneficiaries of such provision.

(E) For purposes of this paragraph, the term “revenue losing provision” means any provision which results in a reduction in Federal tax revenues for any one of the two following periods—

(i) the first fiscal year for which the provision is effective; or

(ii) the period of the 5 fiscal years beginning with the first fiscal year for which the provision is effective.

(F) The terms used in this paragraph shall have the same meaning as those terms have generally in the Internal Revenue Code of 1986, unless otherwise expressly provided.

(10) OMB.—The term “OMB” means the Director of the Office of Management and Budget.

 

 

Previous:

Section 1025 (ICA-LIV)

Next:

Section 1027 (ICA-LIV)
Counsel Notes
Endnotes

[1] This section was originally classified to the U.S. Code at 2 U.S.C. 691e (section omitted from code).

[2] Section 10122 of the Budget Enforcement Act of 1997 amended this clause by striking the word “and” and inserting the word “or”.

CODIFICATION

Section 1026 was codified as section 691e in title 2 of the U.S. Code, Pub. L. 93–344, title X, §1026, as added by section 2 of Pub. L. 104–130, §2(a), Apr. 9, 1996, 110 Stat. 1207.

Joint Statement of Managers on the Line Item Veto Act of 1996

The Conference Report on the Line Item Veto Act of 1996 (H. Rept. 104-491):

Sec. 1026. Definitions

(1) Appropriation Law. As used in this Act, the term “appropriation law” includes any Act which provides general, special, supplemental, deficiency, or continuing appropriations of federal funds, which has been presented to the President in accordance with Article I, section 7 of the Constitution of the United States, and which has been affirmatively signed into law by the President.

(2) Calendar Day. The term “calendar day” means a standard 24-hour period beginning at midnight.

(3) Calendar Day of Session. The term “calendar day of session” means only those days on which both Houses of Congress are in session. This definition excludes periods of recess and adjournment by either House.

(4) Cancel. In the case of discretionary budget authority, the term “cancel” means to rescind an entire dollar amount. The term rescind is clearly understood through long experience between the Executive and Legislative branches with respect to appropriated funds. The conferees do not intend that any new interpretation be applied to the term rescind, but rather intend to narrow the scope of cancellation authority as compared with the authority provided under section 1012 of the Budget Act.

For items of new direct spending, three definitions are provided to specifically tailor the cancellation authority to the type of direct spending involved. In the case of direct spending that is budget authority provided by law other than an appropriation law, the term cancel means to prevent that budget authority from having legal force or effect. For example, in the case of budget authority that provides authority to contract for a particular project, the effect of a cancellation by the President would be to foreclose the ability of the Federal Government to enter into an agreement to pay the amount of money provided in the law. The cancellation affects only the money that would otherwise be spent, and may not be used to alter or terminate any condition contained in the law.

For entitlement authority, the term cancel means that the President may prevent the specific provision that results in the deficit-increasing obligation of the Federal Government from having legal force or effect. The cancellation affects only the legal obligation to pay a benefit, and does not change or affect any other aspect of the law.

With respect to direct spending that is conducted through the food stamp program, the term cancel means that the President may prevent the specific provision of law that results in an increase in expenditures from having legal force or effect. Again, the authority is narrowly defined, and is limited only to eliminating the increase in food stamp obligations that would otherwise occur. No other aspect of the law could be altered, terminated or otherwise affected.

Finally, with respect to limited tax benefits, the term cancel means to prevent the specific provision of law that provides the benefit from having legal force or effect. Again, the authority granted the President is very narrow—only to collect the tax that would otherwise not be collected or to deny the credit that would otherwise be provided. The President may not change, alter, or modify any other aspect of the law.

(5) Direct Spending. The term “direct spending” is an existing term that is defined in section 250(8) of the Balanced Budget and Emergency Deficit Control Act of 1985. The conference report makes technical modifications to the definition to make it appropriate for use in part C of title X, but the conferees intend the term “direct spending” to have the same meaning as it does under the Balanced Budget and Emergency Deficit Control Act.

(6) Disapproval Bill. For the purposes of the conference report, the term “disapproval bill” is defined as a bill or a joint resolution which only disapproves one or more cancellations of dollar amounts of discretionary budget authority, items of new direct spending or limited tax benefits in a special message transmitted by the President under section 1022.

The disapproval bill is defined to include a list by reference number of one or more of the cancellations in the President’s special message, allowing the opportunity for amendments relating to specific cancellations. The structure of the disapproval bill is carefully defined and proscribed to ensure that only a list of reference numbers identifying cancellations from a particular special message, and nothing, more are included in a bill that is eligible for the expedited procedures that are provided under section 1025. Since it is the intent of the conferees to ensure that the expedited procedures are reserved for bills that only disapprove any or all of the President’s cancellations, the definition is designed to ensure that matters beyond the scope of the President’s special message are not permitted to be added to a disapproval bill. However, the conferees recognize the legitimate interest members may have in limiting the focus of a disapproval bill to include only a subset of the cancellations in a President’s special message.

(8) Item of New Direct Spending. The term “item of new direct spending” means a provision of law that results in an increase in budget authority or outlays relative to the baseline set forth pursuant to section 257 of the Balanced Budget and Emergency Deficit Control Act of 1985.Under the Balanced Budget and Emergency Deficit Control Act of 1985, a reauthorization or an extension of a major entitlement program would not result in an increase in direct spending. As a consequence, such legislation would not constitute an item of new direct spending pursuant to the conference report. This does not mean that legislation must result in a net increase in spending in order to be subject to this cancellation authority. A provision of a future law that increases direct spending would be subject to the President’s cancellation authority whether or not it is offset by another provision that reduces direct spending or increases revenues in the same law.

Unlike an appropriation law, which specifically designates a dollar amount for a specific program, direct spending can arise from a number of interactions among provisions in a new law, other provisions in that same new law, and underlying law. The conference report provides the President with the authority to cancel the legal obligation provided by the new law that results in new direct spending. The cancellation authority is limited to the specific provisions in the new law signed by the President that result in the legal obligation to expend funds and does not extend to other previously enacted laws.

(9) Limited Tax Benefit. In general, a “limited tax benefit” is any provision under the Internal Revenue Code that is either (1) a revenue-losing provision that provides a Federal tax deduction, credit, exclusion, or preference to 100 or fewer beneficiaries (unless the effect of the provision is that all similarly situated persons receive the same treatment); or (2) a provision that provides transitional relief to 10 or fewer beneficiaries.

The number of beneficiaries affected by a provision is determined by considering each fiscal year in which the provision will be in effect; if the number of beneficiaries falls below the requisite threshold for any one of those fiscal years, the provision could be identified as a limited tax benefit. For purposes of determining the number of beneficiaries, certain individuals and businesses would be aggregated: all businesses and associations which are related (within the meaning of Internal Revenue Code sections 707(b) and 1563(a)) would be treated as one beneficiary; all qualified plans of a single employer would be treated as one beneficiary; all holders of the same bond issue would be treated as one beneficiary. However, individual shareholders of a corporation, partners of a partnership, members of an association, or beneficiaries of a trust would not be counted as separate beneficiaries simply because a benefit is provided to the respective corporation, partnership, association, or trust.

(10) OMB. The term “OMB” means the Director of the Office of Management and Budget.

[U.S. Congress, Joint Explanatory Statement on the Committee of Conference on S.4; (H. Rept. 104-491), Committee on Government Reform, House of Representatives, 104th Congress, 2d Session, Washington D.C. 1996.]

See the here for the full description of the section: Joint Explanatory Statement of the Managers of Conference:  Section 1026. Definitions: Explanation

LEGISLATIVE HISTORY NOTES
PUBLIC LAWS

Pub. L. 93–344, title X. Section §1026 was added to the Impoundment Control Act of 1974 by Section 2 of the Line Item Veto Act (Pub. L. 104–130, 110 Stat. 1200).

Pub. L. 105–33, title X, §10122), Aug. 5, 1997, 111 Stat. 696. The Budget Enforcement Act of 1997 amended this section.

CODIFICATION

Section 1026 was codified as section 691e in title 2 of the U.S. Code, Pub. L. 93–344, title X, §1026, as added by section 2 of Pub. L. 104–130, §2(a), Apr. 9, 1996, 110 Stat. 1207.

The section was amended by the Budget Enforcement Act of 1997 (Pub. L. 105–33, title X, §10122, Aug. 5, 1997, 111 Stat. 697).

The section defined terms used in this subchapter. 

AMENDMENT
1997

Paragraph (7)(A)(iv) .

Pub. L. 105–33, title X, §10122, Aug. 5, 1997, 111 Stat. 697 (Budget Enforcement Act of 1997 (BEA 1997)) struck “and” and replaced it with “or”. This was a technical amendment made by section 10122 of that Act (BEA 1997).

 

 

Previous:

Section 1025 (ICA-LIV)

 Next:

Section 1027 (ICA-LIV)

 

FrillBreak

[BCR § 196]