DATE: June 23, 1999

TIME: 2:00 PM

ROOM: H-313 The Capitol

On Wednesday, June 23, 1999, the Rules Committee will exercise its original jurisdiction in marking up the procedural provisions of H.R. 853, which seeks to fundamentally reform the Congressional budget process through a series of changes to the Congressional Budget Act of 1974 and the rules of the House. The Committee shares jurisdiction over this measure with the Budget Committee and the Appropriations Committee.

In the 106th Congress, the Committee held two days of hearings on H.R. 853. On May 12, the Committee heard from the Director of the Congressional Budget Office, Dan Crippen; the Associate Director for Budget Issues at the General Accounting Office, Susan Irving; Ms. Martha Phillips of the Concord Coalition; Professor Tim Muris of the George Mason School of Law; Mr. Robert Greenstein, of the Center for Budget and Policy Priorities; and Representatives Jim Nussle (IA), Ben Cardin (MD) and David Minge (D-MN), three of the primary sponsors of the legislation. On May 13, the Committee heard testimony from Representatives Joe Barton (R-TX), Nick Smith (R-MI), George Gekas (R-PA), Mike Castle (R-DE), Ralph Regula (R-OH) and John Spratt (D-SC).

On Thursday, June 17, the Budget Committee marked up the measure during a four-hour meeting in which it adopted an amendment in the nature of a substitute, offered by the bill's prime sponsor Mr. Nussle (R-IA), as amended by one amendment to title II (emergencies), offered by Mr. Bentsen (D-TX). The amendment in the nature of a substitute incorporated a series of technical and clarifying changes to the introduced text.

On Tuesday, June 22, the Appropriations Committee is scheduled to hold its mark-up of H.R. 853, with plans to strike the provision in the bill that establishes an automatic continuing resolution.

The leadership has signaled its interest in moving H.R. 853 to the floor for consideration by the House in the coming weeks.

H.R. 853 was introduced by a bipartisan coalition of Members on February 25, 1999. Included among the bill's prime sponsors are Rules Committee Chairman David Dreier and Legislative and Budget Process Subcommittee Chairman Porter Goss. The legislation, which is nearly identical to a bill introduced at the end of the 105th Congress (H.R. 4837), is the product of approximately two years of cooperative work between the Rules Committee and the Budget Committees (the two House committees with primary jurisdiction over the Congressional budget process). H.R. 853 was referred to the Committees on Budget and Rules, and additionally to the Committee on Appropriations. The legislation currently carries 30 bipartisan cosponsors.

The effort to reform the existing Congressional budget process is certainly not new. Since the inception of the Congressional Budget Act of 1974, proposals for modifications to the procedures governing the consideration by the Congress of the nation's spending and revenue plans have been plentiful. In previous Congresses, modifications to the budget process have generally occurred as part of reconciliation legislation, or as changes to House rules on the opening day of a new Congress. Additionally, the House has from time to time considered high profile single-issue changes to the process, most notably in recent years were the Line Item Veto Act, the Deficit Reduction Lock-Box Act, and proposals to enact an automatic continuing resolution mechanism. What is new to the current effort, however, is its comprehensive nature and the manner in which the legislative product, H.R. 853, was developed.

Starting in 1995, staff of the Rules Committee and the Budget Committee, by direction of their two chairmen, have met to review the existing process, assess proposals for change and devise a comprehensive reform package. Since that time, the Rules Committee has held three joint subcommittee hearings on budget process reform issues, and conducted a Member briefing on the existing parameters of the process. In 1997, the Budget Committee established a bipartisan Budget Process Task Force, whose chairman was Representative Jim Nussle (IA) and whose ranking member was Representative Ben Cardin (MD). The Task Force held a series of hearings throughout the 105th Congress on issues relating to the budget process.

The culmination of the bipartisan, two-committee effort was the introduction, in October 1998, of H.R. 4837. That legislative product, modified to reflect the recodification of House rules that occurred at the outset of the 106th Congress, is reflected in H.R. 853.

Among the chief criticisms of the existing budget process are its complexity, the lack of accountability for the fiscal decisions it fosters, the low level of public confidence it inspires and the weakness of existing enforcement mechanisms. In producing H.R. 853, the sponsors of the legislation attempted, while maintaining a broad appeal for the final product, to address these weaknesses in the system.

Many of the major provisions of H.R. 853 are based on the work of a variety of bipartisan Members who have developed innovative proposals for reform. H.R. 853 reflects the work of Representative Chris Cox (CA) and Representative Joe Barton (TX) on the fundamental question of the form of the budget resolution and ways to increase accountability for federal spending. Likewise, the work of Representative Mike Castle (DE) on emergency spending, Representative Nick Smith (MI) on the debt limit and Representatives George Gekas (PA) and Dana Rohrabacher (CA) on automatic continuing resolutions is reflected in H.R. 853 as well. The bill also includes provisions similar to legislation authored in the past by Representative Joe Moakley (MA) on the application of Budget Act points of order to unreported bills, by Martin Sabo (MN) on the Senate's Byrd Rule, by Representative Charles Stenholm (TX) and former Representative Tim Penny (MN) on baselines, by Senators Bob Kerrey (NE) and former Senator Alan Sympson (WY) on long-term budgetary trends, and by former Representatives (now Senators) Mike Crapo (ID) and Charles Schumer (NY) on the spending accountability lock-box.

• Gives the budget the force of law by transforming the existing nonbinding concurrent resolution on the budget into a joint budget resolution that would be presented to the President for signature. This change would also simplify the existing process by collapsing the 20 current, nonenforceable budget functions into aggregate spending and revenue levels, with separate categories for discretionary and mandatory spending. The bill provides for an alternate, concurrent resolution process to allow the Congress to proceed with the budget process if the President vetoes the joint budget resolution.

   

• Establishes a "rainy day" reserve fund for emergencies based on a clear definition of what is meant by the term "emergency" (a term not currently defined in law). This provision requires the President and the Congress to budget up front in the budget resolution for emergencies by setting aside funding in a reserve that will contain an amount at least equal to the five-year historical average of amounts that have been provided to respond to emergencies. Funds could only be released from the reserve fund if the Budget Committee certifies that a situation has arisen that requires funding for "the prevention, mitigation of, or response to, loss of life or property, or a threat to national security" and the situation is "unanticipated" (defined as "sudden, urgent, unforseen and temporary").

   

• Strengthens the enforcement of budgetary decisions by requiring that each committee include a budget compliance statement in the report of each of its bills indicating whether the bill is within the budgetary levels for that committee set forth by the budget resolution. The compliance statement must be included in committee reports if it has been timely submitted by the Budget Committee. In addition, the bill applies budgetary controls to legislation that has not been reported, which closes a significant loophole in the existing process for unreported bills. The Rules Committee is also required to justify and estimate the costs of any waivers of budget enforcement procedures that it grants through special rules.

   

• Increases accountability for federal spending by requiring that new spending programs be periodically reauthorized . The bill requires committees to submit schedules for reauthorizing, within 10 years, all laws, programs or agencies within their jurisdictions, including entitlements. Further the bill prohibits the consideration of new spending programs unless they last for 10 or fewer years and guarantees the right of Members to offer floor amendments subjecting proposed entitlements to the annual appropriation process.

   

• Requires a vote on legislation that increases the debt limit, thereby reversing the current situation in which House rules allow for an automatic increase in the debt limit without a separate vote by Members of the House.

   

• Displays the unfunded liabilities of Federal insurance programs through new requirements for CBO and OMB to report periodically on long-term budgetary trends. This provision begins the process of phasing in "accrual" budgeting, which is a type of financial planning that recognizes expected long-term costs at the time of the promise to incur those costs. Social, retirement and medical insurance programs are expressly excluded from this requirement.

   

• Reduces the bias toward higher spending by requiring that the President and Congress compare spending estimates to actual prior year spending levels (a further step away from baseline budgeting) and by establishing a lock-box to protect savings in appropriation bills secured during the amendment process on the House floor. In addition, the bill provides for automatic continuing resolutions in the event that annual spending bills are not complete by the start of the new fiscal year.

   

• Reforms PAYGO to allow expanded use of on-budget surpluses for tax cuts or other initiatives. The existing PAYGO rules require offsets for tax cuts or increases in entitlement spending regardless of the existence of an on-budget surplus.