targets used in the report under Section 3 and message (if any) under Section 4.

(b) Adjustment for Increases in Beneficiaries. (1) The Director shall adjust the direct spending targets for increases (if any) in actual or projected numbers of beneficiaries under direct spending programs for which the number of beneficiaries is a variable in determining costs.

(2) The adjustment shall be made by-

(A) computing, for each program under paragraph (1), the percentage change between (i) the annual average number of beneficiaries under that program (including actual numbers of beneficiaries for the prior fiscal year and projections for the budget and subsequent fiscal years) to be used in the President's budget with which the adjustments will be submitted, and (ii) the annual average number of beneficiaries used in the adjustments made by the Director in the previous year (or, in the case of adjustments made in 1994, the annual average number of beneficiaries used in the Director's initial report under Section 2(b));

(B) applying the percentages computed under subparagraph (A) to the projected levels of outlays for each program consistent with the direct spending targets in effect immediately prior to the adjustment; and

(C) adding the results of the calculations required by subparagraph (B) to the direct spending targets in effect immediately prior to the adjustment.

(3) No adjustment shall be made for any program for a fiscal year in which the percentage increase computed under paragraph (2)(A) is less than or equal to

zero.

(c) Adjustments for Revenue Legislation. The Director shall adjust the targets as follows:

(1) they shall be increased by the amount of any increase in receipts; or

(2) they shall be decreased by the amount of any decrease in receipts, resulting from receipts legislation enacted after the date of enactment of OBRA [Aug. 10, 1993], except legislation enacted in response to the message transmitted under Section 4.

(d) Adjustments To Reflect Congressional Decisions. Upon enactment of a reconciliation bill enacted in response to a message submitted under Section 4, the Director shall adjust direct spending targets for the current year, the budget year, and each outyear through 1997 by

(1) increasing the target for the current year and the budget year by the amount stated for that year in that reconciliation bill (but if a separate vote was required by Congressional rules, only if that vote has occurred); and

(2) decreasing the target for the current, budget, and outyears through 1997 by the amount of reductions in direct spending enacted in that reconciliation bill.

(e) Designated Emergencies. The Director shall adjust the targets to reflect the costs of legislation that is designated as an emergency by Congress and the President under section 252(e) of the Balanced Budget and Emergency Deficit Control Act of 1985 [2 U.S.C. 902(e)].

SEC. 7. Relationship to Balanced Budget and Emergency Deficit Control Act. Recommendations pursuant to Section 4 shall include a provision specifying that reductions in outlays or increases in receipts resulting from that legislation shall not be taken into account for purposes of any budget enforcement procedures under the Balanced Budget and Emergency Deficit Control Act of 1985 [2 U.S.C. 900 et seq.).

SEC. 8. Estimating Margin. For any fiscal year for which the overage is less than one-half of 1 percent of the direct spending target for that year, the procedures set forth in Section 4 shall not apply.

SEC. 9. Means-Tested Programs. In making recommendations under Section 4, the Director shall seriously consider all other alternatives before proposing reductions in means-tested programs.

SEC. 10. Effective Date. This order shall take effect upon enactment of OBRA [Aug. 10, 1993]. This order

shall apply to direct spending targets for fiscal years 1994 through 1997 and shall expire at the end of fiscal year 1997.

WILLIAM J. CLINTON.

Ex. ORD. NO. 12858. DEFICIT REDUCTION FUND Ex. Ord. No. 12858, Aug. 4, 1993, 58 F.R. 42185, provided:

By the authority vested in me as President of the United States by the Constitution and the laws of the United States of America, including sections 1104 and 1105 of title 31, United States Code, it is hereby ordered as follows:

SECTION 1. Purpose. It is essential to guarantee that the net deficit reduction achieved by the Omnibus Budget Reconciliation Act of 1993 [Pub. L. 103-66, see Tables for classification] is dedicated exclusively to reducing the deficit.

SEC. 2. Deficit Reduction Fund.

(a) Establishment of the Fund. There is established a separate account in the Treasury, known as the Deficit Reduction Fund, which shall receive the net deficit reduction achieved by the Omnibus Budget Reconciliation Act of 1993 (Pub. L. 103-66, see Tables for classification] as called for in subsection (b) of this order.

(b) Amounts in Fund. Beginning upon enactment of the Omnibus Budget Reconciliation Act of 1993 [Aug. 10, 19931, the Deficit Reduction Fund shall receive any increases in total revenues resulting from enactment of such Act on a daily basis. In addition, on a daily basis, the Secretary of the Treasury shall enter into such account an amount equivalent to the net deficit reduction achieved as a result of all spending reductions resulting from such Act. The cumulative fiscal year amounts for the combination of all such revenue increases and spending reductions shall be equal to:

(1) for fiscal year 1994, $60,292,000,000;
(2) for fiscal year 1995, $70,437,000,000;
(3) for fiscal year 1996, $92,061,000,000;
(4) for fiscal year 1997, $125,881,000,000;

(5) for fiscal year 1998, $146,939,000,000.

Within 30 days of enactment of the Omnibus Budget Reconciliation Act of 1993, the foregoing amounts may be adjusted by the Director of the Office of Management and Budget to reflect the final scoring of such Act.

(c) Status of Amounts in Fund. (i) The amounts in the Deficit Reduction Fund shall be used exclusively to redeem maturing debt obligations of the Treasury of the United States held by foreign governments in the amounts specified in subsection (b).

(ii) The amounts in the Deficit Reduction Fund as set forth in subsection (b) that result from increases in total revenues and spending reductions shall not be available for new spending or to finance measures that increase the deficit for purposes of budget enforcement procedures under the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 901-922).

(d) Effect on Other Funds. Establishment of and transfers to the Deficit Reduction Fund shall not affect trust fund transfers that may be authorized or required by provisions of the Omnibus Reconciliation Act of 1993 or any other provision of law.

SEC. 3. Requirement for the President To Report Annually on the Status of the Fund. The Director of the Office of Management and Budget shall include in the President's Budget transmitted under section 1105 of title 31, United States Code, information about the Deficit Reduction Fund, including a separate statement of amounts in and Federal debt redeemed by that Fund.

SEC. 4. Implementation. The Secretary of the Treasury and the Director of the Office of Management and Budget shall each take such actions as may be necessary, within their respective authorities, promptly to carry out this order.

Senate Committees on the Budget, CBO, and OMB.

(b) Adjustments to discretionary spending limits

(1) When the President submits the budget under section 1105(a) of title 31 for budget year 1992, 1993, 1994, 1995, 1996, 1997, or 1998 (except as otherwise indicated), OMB shall calculate (in the order set forth below), and the budget shall include, adjustments to discretionary spending limits (and those limits as cumulatively adjusted) for the budget year and each outyear through 1998 to reflect the following:

(A) Changes in concepts and definitions

The adjustments produced by the amendments made by title XIII of the Omnibus Budget Reconciliation Act of 1990 or by any other changes in concepts and definitions shall equal the baseline levels of new budget authority and outlays using up-to-date concepts and definitions minus those levels using the concepts and definitions in effect before such changes. Such other changes in concepts and definitions may only be made in consultation with the Committees on Appropriations, the Budget, Government Operations, and Governmental Affairs of the House of Representatives and Senate.

(2) When OMB submits a sequestration report under section 904(g) or (h) of this title for fiscal year 1991, 1992, 1993, 1994, 1995, 1996, 1997, or 1998 (except as otherwise indicated), OMB shall calculate (in the order set forth below), and the sequestration report, and subsequent budgets submitted by the President under section 1105(a) of title 31, shall include, adjustments to discretionary spending limits (and those limits as adjusted) for the fiscal year and each succeeding year through 1998, as follows:

(A) IRS funding

To the extent that appropriations are enacted that provide additional new budget authority or result in additional outlays (as compared with the CBO baseline constructed in June 1990) for the Internal Revenue Service compliance initiative in any fiscal year, the adjustments for that year shall be those amounts, but shall not exceed the amounts set forth below

(i) for fiscal year 1991, $191,000,000 in new budget authority and $183,000,000 in outlays;

(ii) for fiscal year 1992, $172,000,000 in new budget authority and $169,000,000 in outlays;

(iii) for fiscal year 1993, $183,000,000 in new budget authority and $179,000,000 in outlays;

(iv) for fiscal year 1994, $187,000,000 in new budget authority and $183,000,000 in outlays; and

(v) for fiscal year 1995, $188,000,000 in new budget authority and $184,000,000 in outlays; and

the prior-year outlays resulting from these appropriations of budget authority.

(B) Debt forgiveness

If, in calendar year 1990 or 1991, an appropriation is enacted that forgives the Arab Republic of Egypt's foreign military sales indebtedness to the United States and any part of the Government of Poland's indebtedness to the United States, the adjustment shall be the estimated costs (in new budget authority and outlays, in all years) of that forgiveness. (C) IMF funding

If, in fiscal year 1991, 1992, 1993, 1994, or 1995 an appropriation is enacted to provide to the International Monetary Fund the dollar equivalent, in terms of Special Drawing Rights, of the increase in the United States quota as part of the International Monetary Fund Ninth General Review of Quotas, the adjustment shall be the amount provided by that appropriation.

(D) Emergency appropriations

(i) If, for any fiscal year, appropriations for discretionary accounts are enacted that the President designates as emergency requirements and that the Congress so designates in statute, the adjustment shall be the total of such appropriations in discretionary accounts designated as emergency requirements and

the outlays flowing in all years from such appropriations.

(ii) The costs for operation Desert Shield are to be treated as emergency funding requirements not subject to the defense spending limits. Funding for Desert Shield will be provided through the normal legislative process. Desert Shield costs should be accommodated through Allied burden-sharing, subsequent appropriation Acts, and if the President so chooses, through offsets within other defense accounts. Emergency Desert Shield costs mean those incremental costs associated with the increase in operations in the Middle East and do not include costs that would be experienced by the Department of Defense as part of its normal operations absent Operation Desert Shield.

(E) Special allowance for discretionary new budget authority

(i) For each of fiscal years 1992 and 1993, the adjustment for the domestic category in each year shall be an amount equal to 0.1 percent of the sum of the adjusted discretionary spending limits on new budget authority for all categories for fiscal years 1991, 1992, and 1993 (cumulatively), together with outlays associated therewith (calculated at the composite outlay rate for the domestic category);

(ii) for each of fiscal years 1992 and 1993, the adjustment for the international category in each year shall be an amount equal to 0.079 percent of the sum of the adjusted discretionary spending limits on new budget authority for all categories for fiscal years 1991, 1992, and 1993 (cumulatively), together with outlays associated therewith (calculated at the composite outlay rate for the international category);

(iii) if, for fiscal years 1992 and 1993, the amount of new budget authority provided in appropriation Acts exceeds the discretionary spending limit on new budget authority for any category due to technical estimates made by the Director of the Office of Management and Budget, the adjustment is the amount of the excess, but not to exceed an amount (for 1992 and 1993 together) equal to 0.042 percent of the sum of the adjusted discretionary limits on new budget authority for all categories for fiscal years 1991, 1992, and 1993 (cumulatively); and

(iv) if, for fiscal years 1994, 1995, 1996, 1997, and 1998, the amount of new budget authority provided in appropriation Acts exceeds the discretionary spending limit on new budget authority due to technical estimates made by the director of the Office of Management and Budget, the adjustment is the amount of the excess, but not to exceed an amount (for any one fiscal year) equal to 0.1 percent of the adjusted descretionary 2 spend

1

2

ing limit on new budget authority for that fiscal year.

'So in original. Probably should be capitalized. *So in original. Probably should be “discretionary".

(F) Special outlay allowance

If in any fiscal year outlays for a category exceed the discretionary spending limit for that category but new budget authority does not exceed its limit for that category (after application of the first step of a sequestration described in subsection (a)(2) of this section, if necessary), the adjustment in outlays is the amount of the excess, but not to exceed $2,500,000,000 in the defense category, $1,500,000,000 in the international category, or $2,500,000,000 in the domestic category (as applicable) in fiscal year 1991, 1992, or 1993, and not to exceed $6,500,000,000 in fiscal year 1994 or 1995 less any of the outlay adjustments made under subparagraph (E) for a category for a fiscal year, and not to exceed 0.5 percent of the adjusted descretionary spending limit on outlays for the fiscal year in fiscal year 1996, 1997, or 1998. (G) Net guarantee costs

The net costs for fiscal year 1994 of the appropriation made under section 2186 of title 22 are not subject to the discretionary spending limits or the Appropriations Committee's Foreign Operations Subcommittee's [section] 602(b) [2 U.S.C. 665a(b)] allocation in fiscal year 1994.

(As amended Pub. L. 101-508, title XIII, § 13101(a), (e)(2), Nov. 5, 1990, 104 Stat. 1388-577, 1388-593; Pub. L. 103-66, title XIV, § 14002(c)(1), Aug. 10, 1993, 107 Stat. 683; Pub. L. 103-87, title V, § 571, Sept. 30, 1993, 107 Stat. 971.)

TERMINATION OF SECTION

For termination of section by section 14002(c)(3)(A) of Pub. L. 103-66, see Effective and Termination Dates note set out under section 900 of this title.

Pub. L. 103-66,

2