October 11, 2017

S. CON. RES. 25 – Concurrent Resolution on the Budget for Fiscal Year 2018

Noteworthy

Background: The Senate Budget Committee reported the budget resolution out of committee on October 5 by a vote of 12-11. Chairman Enzi released background information and summary tables on the budget resolution here.

Floor Situation: The Senate is expected to consider the budget resolution on the floor the week of October 16.

Executive Summary: This budget resolution contains instructions that allow for comprehensive tax reform legislation as well as energy legislation. The spending and revenue levels outlined in the resolution would result in on-budget balance in 2026, with a surplus of $79 billion.

Considerations on the Resolution

The budget resolution contains reconciliation instructions to the Finance Committee for comprehensive tax reform legislation. It also contains reconciliation instructions to the Energy and Natural Resources Committee.

The budget resolution would result in on-budget outlays in fiscal year 2018 of $3.1 trillion, compared to on-budget outlays under the CBO baseline of $3.2 trillion. On-budget outlays from 2018-2027 would total $35.05 trillion under the resolution, compared to the adjusted CBO baseline total of $40.1 trillion in on-budget outlays.

On-budget revenues would total $2.5 trillion under the resolution in fiscal year 2018, compared to the CBO baseline of $2.7 trillion. Ten-year on-budget revenues would total $31.2 trillion under the resolution, compared to the CBO baseline of $32.8 trillion; this decrease reflects the reconciliation instructions contained in Title II, and a placeholder for repeal of Obamacare.

Under the resolution, the budget would balance by 2026, with a $79 billion on-budget surplus in that year. In 2027, the final year of the budget window, the on-budget surplus would be $197 billion. By borrowing less, the Senate budget resolution would lead to $259 billion in interest cost savings over the 10-year period.

The budget resolution does not alter the Budget Control Act discretionary spending caps for defense and nondefense levels in fiscal year 2018. It does contain adjustment authority for future legislation that would modify these caps.

Debate Structure

Under the Budget Act of 1974, as amended, a budget resolution is a privileged piece of legislation. It is not subject to filibuster, and debate time is limited to 50 hours, equally divided. There are sub-limits within the overall time limitation, such as a two-hour limit on any first-degree amendment and a one-hour limit on any second-degree amendment, debatable motion, or appeal. Time can be yielded back. Votes do not count against the 50-hour time limit, nor do quorum calls just prior to votes.

Amendments to the budget resolution must be germane. A point of order lies against non-germane amendments, and 60 votes are required to waive the point of order. Germane amendments are those which:

1) Strike language;

2) Increase or decrease numbers;

3) Add language that restricts some power in the resolution;

4) Add language that is germane to other language in the resolution; or

5) Change dates

Debate on first-degree amendments is limited to two hours: one hour to proponents and one hour to opponents. Debate on second-degree amendments is limited to one hour: 30 minutes to proponents and 30 minutes to opponents. All debate time on a first-degree amendment must be used or yielded back before a second-degree amendment can be offered.

Debate on any motion to waive a point of order is limited to one hour, equally divided. Amendments can be offered at any time.

In the Senate, a motion to recommit is not in order except a motion to recommit with instructions to report back within a specific number of days (no more than three, not counting any day in which the Senate is not in session). Debate on the motion is limited to one hour, equally divided, and is controlled by the mover and the manager of the budget resolution.

Once all debate time has been used or yielded back, senators may continue to offer further amendments. No debate is in order, but roll call votes can be taken. Dozens of votes may occur with little or no explanation. This is known as “vote-a-rama.” Once all amendments have been dispensed with, a vote on final passage occurs.

Notable Bill Provisions

Title I – Recommended Levels and Amounts

Title I contains recommended levels and amounts for various budget functions, revenues, budget authority, outlays, and debt. The budget totals are outlined above.

Title II – Reconciliation

The budget resolution contains reconciliation instructions to the Finance Committee to “report changes in laws within its jurisdiction that increase the deficit by not more than” $1.5 trillion from 2018-2027. It also instructs the Energy and Natural Resources Committee to report changes that reduce the deficit by at least $1 billion from 2018-2027. The two committees are ordered to report their recommendations to the Budget Committee by November 13, 2017, but there is no penalty for missing this deadline.

Title III – Reserve Funds

Reserve funds allow the Budget Committee chairman to change numbers contained in an already-passed budget resolution if legislation meeting the reserve fund’s criteria is considered on the Senate floor. This allows the legislation to be considered without a budget point of order against it for violating the levels contained in the budget resolution. Reserve funds only allow numbers to be changed in the budget resolution; they do not eliminate the need for cloture or otherwise expedite floor consideration of legislation.

The budget resolution contains the following reserve funds regarding future legislation:

  1. Repealing and replacing Obamacare (section 3001).

  2. Tax reform, including “tax relief for middle-income working Americans; lowering taxes on families with children; or incentivizing companies to invest domestically and create jobs in the United States” (section 3002).

  3. Reconciliation legislation pursuant to instructions in this resolution (section 3003).

  4. Extending the State Children’s Health Insurance Program (section 3004).

  5. The opioid and substance abuse crisis; victims of domestic abuse; foster care, child care, marriage, and fatherhood programs; retirement savings; public housing reform; the Community Development Block Grant Program; or extending expiring health care programs (section 3005).

  6. Amending the Higher Education Act of 1965; state flexibility in education; federal workforce development, job training, and reemployment programs; early learning and child care programs; educational programs for people with disabilities; or child nutrition programs (section 3006).

  7. Improving the American banking system (section 3007).

  8. The farm bill; energy policy; the Nuclear Regulatory Commission; North American energy development; infrastructure, transportation, and water development; the Federal Aviation Administration; the National Flood Insurance Program; state mineral royalty revenues; or soda ash royalties (section 3008).

  9. Military readiness; military technological superiority; defense reforms; or cybersecurity efforts (section 3009).

  10. Improving the delivery of benefits and services to veterans and service members (section 3010).

  11. The Endangered Species Act of 1973; forest health and wildfire prevention control; resources for wildland firefighting for the Forest Service and Department of the Interior; payments in lieu of taxes; or secure rural schools and community self-determination program (section 3011).

  12. Securing the U.S. border; ending human trafficking; or stopping the transportation of narcotics into the U.S. (section 3012).

  13. Reducing the costs of federal regulations; increasing commerce and economic growth; or enhancing job creation (section 3013).

  14. Modifying statutory budget controls, which may include changes to discretionary spending limits, and changes to the scope of sequestration such as for the Financial Accounting Standards Board, Public Company Accounting Oversight Board, Securities Investor Protection Corporation, and similar entities (section 3014).

  15. Preventing taxpayer bailouts of pension plans (section 3015).

  16. Implementing work requirements for “all means-tested federal welfare programs” (passed during committee markup, section 3016).

  17. Protecting Medicare, “which may include repealing the Independent Payment Advisory Board” (passed during committee markup, section 3017).

  18. Making child care more affordable (passed during committee markup, section 3018).

  19. Worker training programs (passed during committee markup, section 3019).

  20. Disaster funding “for relief and recovery to areas devastated by Hurricanes and flooding in 2017” (passed during committee markup, section 3020).

Title IV – Budget Process

Title IV includes points of order for the purposes of budget enforcement in the Senate and other provisions:

  1. Limit on advance appropriations in fiscal years 2019 and 2020 of $28.852 billion in each year, plus any amounts provided for the traditional exceptions of the Corporation for Public Broadcasting and certain Veterans Affairs accounts (section 4101).

  2. Limits the use of “changes in mandatory spending programs” – or CHIMPs – that do not reduce outlays. The limits are $17 billion in fiscal year 2018, and $15 billion in each of the fiscal years 2019 and 2020. This section extends the limit that was included in S. Con. Res. 11, the fiscal year 2016 budget resolution (section 4102).

  3. Limit of $11.2 billion on the amount of CHIMPs that can affect the Crime Victims Fund in fiscal year 2018 (section 4103).

  4. Allows a senator to move to strike a designation of funds as “overseas contingency operations” funds; provides for a three-fifths waiver vote (section 4104).

  5. Floor amendments to the reconciliation bill ordered by this resolution cannot have unknown budgetary effects (section 4105).

  6. More thorough pay-as-you-go point of order that requires legislation to not add to the deficit during any of four distinct time periods: the current fiscal year, the budget year under consideration, the six years from the current fiscal year, and the 11 years from the current fiscal year (section 4106).

  7. Requires, “to the greatest extent practicable,” dynamic scoring for major legislation. During committee markup, the committee adopted an amendment by Senator King that required “to the extent practicable” such scores to include distributional effects across income groups (section 4107).

  8. Allows adjustments to committee allocations if legislation is enacted that amends the discretionary spending limits (section 4108).

  9. Allows adjustments to committee allocations if legislation is enacted that provides wildfire suppression funding (section 4109).

  10. Allows adjustments to committee allocations if legislation is enacted that decreases mandatory spending and authorizes discretionary spending (section 4110).

  11. Repeals two sections from the fiscal year 2016 budget resolution, S. Con. Res. 11. Those two sections are 3205, “Prohibition on agreeing to legislation without a score in the Senate” and 3206 “Protecting the savings in reported reconciliation bills in the Senate” (section 4111).

  12. Technical correction to the emergency designation process (section 4112).

  13. Provides enforcement filing authority for the Budget Committee chairman in case there is no conference committee on the budget resolution, and thus no joint explanatory statement, where committee allocation limits would typically be made (section 4113).

  14. Directs committees to identify waste, fraud, abuse, or duplication in order to assist in oversight of government performance (section 4201).

  15. Directs that any 302(a) allocation for the Appropriations Committee include amounts for discretionary administrative expenses of the Social Security Administration and of the Postal Service (section 4202).

  16. Includes guidelines for the application and effect of changes in allocations and aggregates (section 4203).

  17. Allows adjustment to levels and allocations if a law is enacted that changes a budgetary concept or definition (section 4204).

  18. Allows adjustments to levels and allocations to reflect legislation enacted between CBO’s June 2017 baseline and adoption of the budget resolution (section 4205).

  19. Asserts that all provisions of Title IV are an exercise of the Senate’s rulemaking powers (section 4206).

Cost

The Congressional Budget Office does not score budget resolutions since a budget resolution does not change current law.

Amendments

Amendments will be considered, many in vote-a-rama.