Subsec. (b)(2)(F). Pub. L. 103–66, § 14002(c)(1)(B)(vi), inserted before period at end ", and not to exceed 0.5 percent of the adjusted descretionary [sic] spending limit on outlays for the fiscal year in fiscal year 1996, 1997, or 1998".

Subsec. (b)(2)(G). Pub. L. 103-87 added subpar. (G). 1990-Pub. L. 101-508, § 13101(a), amended section generally, substituting subsecs. (a) and (b) relating to enforcement of discretionary spending limits for former subsecs. (a) to (e) relating to reporting of excess deficits.

Subsec. (a)(6)(I). Pub. L. 101-508, § 13101(e)(2), redesignated subsec. (a)(6)(I) of this section as section 907(e) of this title.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 665, 665b, 665e, 900, 902, 903, 904, 905, 908, 922 of this title; title 16 section 556c; title 38 section 113; title 39 section 2009a; title 42 section 5203; title 43 section 14748.

§ 902. Enforcing pay-as-you-go

(a) Fiscal years 1992-1998 enforcement

The purpose of this section is to assure that any legislation (enacted after November 5, 1990) affecting direct spending or receipts that increases the deficit in any fiscal year covered by this Act will trigger an offsetting sequestration.

(b) Sequestration; look-back

Within 15 calendar days after Congress adjourns to end a session (other than of the One Hundred First Congress) and on the same day as a sequestration (if any) under section 901 of this title and section 903 of this title, there shall be a sequestration to offset the amount of any net deficit increase in that fiscal year and the prior fiscal year caused by all direct spending and receipts legislation enacted after November 5, 1990 (after adjusting for any prior sequestration as provided by paragraph (2)). OMB shall calculate the amount of deficit increase, if any, in those fiscal years by adding

(1) all applicable estimates of direct spending and receipts legislation transmitted under subsection (d) of this section applicable to those fiscal years, other than any amounts included in such estimates resulting from

(A) full funding of, and continuation of, the deposit insurance guarantee commitment in effect on November 5, 1990, and

(B) emergency provisions as designated under subsection (e) of this section; and

(2) the estimated amount of savings in direct spending programs applicable to those fiscal years resulting from the prior year's sequestration under this section or section 903 of this title, if any (except for any amounts sequestered as a result of a net deficit increase in the fiscal year immediately preceding the prior fiscal year), as published in OMB's end-of-session sequestration report for that prior year.

(c) Eliminating a deficit increase

(1) The amount required to be sequestered in a fiscal year under subsection (b) of this section

shall be obtained from non-exempt direct spending accounts from actions taken in the following order:

(A) First

All reductions in automatic spending increases specified in section 906(a) of this title shall be made.

(B) Second

If additional reductions in direct spending accounts are required to be made, the maximum reductions permissible under sections 906(b) of this title (guaranteed student loans) and 906(c) of this title (foster care and adoption assistance) shall be made.

(C) Third

(i) If additional reductions in direct spending accounts are required to be made, each remaining non-exempt direct spending account shall be reduced by the uniform percentage necessary to make the reductions in direct spending required by paragraph (1); except that the medicare programs specified in section 906(d) of this title shall not be reduced by more than 4 percent and the uniform percentage applicable to all other direct spending programs under this paragraph shall be increased (if necessary) to a level sufficient to achieve the required reduction in direct spending.

(ii) For purposes of determining reductions under clause (i), outlay reductions (as a result of sequestration of Commodity Credit Corporation commodity price support contracts in the fiscal year of a sequestration) that would occur in the following fiscal year shall be credited as outlay reductions in the fiscal year of the sequestration.

(2) For purposes of this subsection, accounts shall be assumed to be at the level in the baseline.

(d) OMB estimates

As soon as practicable after Congress completes action on any direct spending or receipts legislation enacted after November 5, 1990, after consultation with the Committees on the Budget of the House of Representatives and the Senate, CBO shall provide OMB with an estimate of the amount of change in outlays or receipts, as the case may be, in each fiscal year through fiscal year 1998 resulting from that legislation. Within 5 calendar days after the enactment of any direct spending or receipts legislation enacted after November 5, 1990, OMB shall transmit a report to the House of Representatives and to the Senate containing such CBO estimate of that legislation, an OMB estimate of the amount of change in outlays or receipts, as the case may be, in each fiscal year through fiscal year 1998 resulting from that legislation, and an explanation of any difference between the two estimates. Those OMB estimates shall be made using current economic and technical assumptions. OMB and CBO shall prepare estimates under this paragraph in conformance with scorekeeping guidelines determined after consultation among the House

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.

REFERENCES IN TEXT

This Act, referred to in subsec. (a), means Pub. L. 99-177, Dec. 12, 1985, 99 Stat. 1037, as amended, which enacted this chapter and sections 654 to 656 of this title, amended sections 602, 622, 631 to 642, and 651 to 653 of this title, sections 1104 to 1106, 1109, and 3101 of Title 31, Money and Finance, and section 911 of Title 42, The Public Health and Welfare, repealed section 661 of this title, enacted provisions set out as notes under section 900 of this title and section 911 of Title 42, and amended provisions set out as a note under section 621 of this title. For complete classification of this Act to the Code, see Tables.

CODIFICATION

November 5, 1990, referred to in subsecs. (a), (b), and (d), was in the original "the date of enactment of this section", which was translated as meaning the date of enactment of Pub. L. 101-508, which amended this section generally, to reflect the probable intent of Congress.

AMENDMENTS

1993-Subsec. (a). Pub. L. 103-66, § 14003(a)(1), which directed the substitution of "Fiscal year 1992-1998 enforcement" for "Fiscal year 1992-1995 enforcement" in heading, was executed by substituting "Fiscal years 1992-1998 enforcement" for "Fiscal years 1992-1995 enforcement", to reflect the probable intent of Congress.

Subsec. (d). Pub. L. 103-66, § 14003(a)(2), substituted "through fiscal year 1998" for "through fiscal year 1995" in two places.

Subsec. (e). Pub. L. 103–66, § 14003(a)(3), substituted "for any fiscal year from 1991 through 1998” for “for fiscal year 1991, 1992, 1993, 1994, or 1995".

1990-Pub. L. 101-508 amended section generally, substituting subsecs. (a) to (e) relating to enforcement of pay-as-you-go for former subsecs. (a) to (g) relating to Presidential order.

REDUCTION OF DIRECT SPENDING AND RECEIPTS LEGISLATION BALANCES

Section 14003(c) of Pub. L. 103-66 provided that: "Upon enactment of this Act [Aug. 10, 1993), the director of the Office of Management and Budget shall reduce the balances of direct spending and receipts legislation applicable to each fiscal year under section

1 So in original. Probably should be "1998".

252 of the Balanced Budget and Emergency Deficit Control Act of 1985 [2 U.S.C. 902] by an amount equal to the net deficit reduction achieved through the enactment in this Act [see Tables for classification] of direct spending and receipts legislation for that year."

SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in sections 665, 665e, 900, 901, 903, 904, 906, 907d, 908, 922 of this title; title 7 section 1446; title 16 sections 3834, 3837d, 3839c; title 31 section 1341; title 39 section 2009a.

§ 903. Enforcing deficit targets

(a) Sequestration

Within 15 calendar days after Congress adjourns to end a session (other than of the One Hundred First Congress) and on the same day as a sequestration (if any) under section 901 of this title and section 902 of this title, but after any sequestration required by section 901 of this title (enforcing discretionary spending limits) or section 902 of this title (enforcing pay-as-you-go), there shall be a sequestration to eliminate the excess deficit (if any remains) if it exceeds the margin.

(b) Excess deficit; margin

The excess deficit is, if greater than zero, the estimated deficit for the budget year, minus

(1) the maximum deficit amount for that year;

(2) the amounts for that year designated as emergency direct spending or receipts legislation under section 902(e) of this title; and

(3) for any fiscal year in which there is not a full adjustment for technical and economic reestimates, the deposit insurance reestimate for that year, if any, calculated under subsection (h) of this section.

The "margin" for fiscal year 1992 or 1993 is zero and for fiscal year 1994 or 1995 is $15,000,000,000.

(c) Dividing sequestration

To eliminate the excess deficit in a budget year, half of the required outlay reductions shall be obtained from non-exempt defense accounts (accounts designated as function 050 in the President's fiscal year 1991 budget submission) and half from non-exempt, non-defense accounts (all other non-exempt accounts).

(d) Defense

Each non-exempt defense account shall be reduced by a dollar amount calculated by multiplying the level of sequestrable budgetary resources in that account at that time by the uniform percentage necessary to carry out subsection (c) of this section, except that, if any military personnel are exempt, adjustments shall be made under the procedure set forth in section 901(a)(3) of this title.

(e) Non-defense

All reductions in automatic spending increases under section 906(a) of this title shall be made.

(2) Second

If additional reductions in non-defense accounts are required to be made, the maximum reduction permissible under sections 906(b) of this title (guaranteed student loans) and 906(c) of this title (foster care and adoption assistance) shall be made. (3) Third

(A) If additional reductions in non-defense accounts are required to be made, each remaining non-exempt, non-defense account shall be reduced by the uniform percentage necessary to make the reductions in non-defense outlays required by subsection (c) of this section, except that

(i) the medicare program specified in section 906(d) of this title shall not be reduced by more than 2 percent in total including any reduction of less than 2 percent made under section 902 of this title or, if it has been reduced by 2 percent or more under section 902 of this title, it may not be further reduced under this section; and

(ii) the health programs set forth in section 906(e) of this title shall not be reduced by more than 2 percent in total (including any reduction made under section 901 of this title),

and the uniform percent applicable to all other programs under this subsection shall be increased (if necessary) to a level sufficient to achieve the required reduction in non-defense outlays.

(B) For purposes of determining reductions under subparagraph (A), outlay reduction (as a result of sequestration of Commodity Credit Corporation commodity price support contracts in the fiscal year of a sequestration) that would occur in the following fiscal year shall be credited as outlay reductions in the fiscal year of the sequestration.

(f) Baseline assumptions; part-year appropriations (1) Budget assumptions

For purposes of subsections (b), (c), (d), and (e) of this section, accounts shall be assumed to be at the level in the baseline minus any reductions required to be made under sections 901 and 902 of this title.

(2) Part-year appropriations

If, on the date specified in subsection (a) of this section, there is in effect an Act making or continuing appropriations for part of a fiscal year for any non-exempt budget account, then the dollar sequestration calculated for that account under subsection (d) or (e) of this section, as applicable, shall be subtracted from

(A) the annualized amount otherwise available by law in that account under that or a subsequent part-year appropriation; and

(B) when a full-year appropriation for that account is enacted, from the amount otherwise provided by the full-year appropriation; except that the amount to be sequestered from that account shall be reduced (but not below zero) by the savings achieved by that appropriation when the

enacted amount is less than the baseline for that account.

(g) Adjustments to maximum deficit amounts (1) Adjustments

(A) When the President submits the budget for fiscal year 1992, the maximum deficit amounts for fiscal years 1992, 1993, 1994, and 1995 shall be adjusted to reflect up-to-date reestimates of economic and technical assumptions and any changes in concepts or definitions. When the President submits the budget for fiscal year 1993, the maximum deficit amounts for fiscal years 1993, 1994, and 1995 shall be further adjusted to reflect up-to-date reestimates of economic and technical assumptions and any changes in concepts or definitions.

(B) When submitting the budget for fiscal year 1994, the President may choose to adjust the maximum deficit amounts for fiscal years 1994 and 1995 to reflect up-todate reestimates of economic and technical assumptions. If the President chooses to adjust the maximum deficit amount when submitting the fiscal year 1994 budget, the President may choose to invoke the same adjustment procedure when submitting the budget for fiscal year 1995. In each case, the President must choose between making no adjustment or the full adjustment described in paragraph (2). If the President chooses to make that full adjustment, then those procedures for adjusting discretionary spending limits described in sections 901(b)(1)(C) and 901(b)(2)(E) of this title, otherwise applicable through fiscal year 1993 or 1994 (as the case may be), shall be deemed to apply for fiscal year 1994 (and 1995 if applicable).

(C) When the budget for fiscal year 1994 or 1995 is submitted and the sequestration reports for those years under section 904 of this title are made (as applicable), if the President does not choose to make the adjustments set forth in subparagraph (B), the maximum deficit amount for that fiscal year shall be adjusted by the amount of the adjustment to discretionary spending limits first applicable for that year (if any) under section 901(b) of this title.

(D) For each fiscal year the adjustments required to be made with the submission of the President's budget for that year shall also be made when OMB submits the sequestration update report and the final sequestration report for that year, but OMB shall continue to use the economic and technical assumptions in the President's budget for that year.

Each adjustment shall be made by increasing or decreasing the maximum deficit amounts set forth in section 665 of this title. (2) Calculations of adjustments

The required increase or decrease shall be calculated as follows:

(A) The baseline deficit or surplus shall be calculated using up-to-date economic and technical assumptions, using up-to-date con

(3) Pay-as-you-go sequestration reports

The preview reports shall set forth, for the current year and the budget year, estimates for each of the following:

(A) The amount of net deficit increase or decrease, if any, calculated under subsection 902(b) of this title.

(B) A list identifying each law enacted and sequestration implemented after November 5, 1990, included in the calculation of the amount of deficit increase or decrease and specifying the budgetary effect of each such law.

(C) The sequestration percentage or (if the required sequestration percentage is greater than the maximum allowable percentage for medicare) percentages necessary to eliminate a deficit increase under section 902(c) of this title.

(4) Deficit sequestration reports

The preview reports shall set forth for the budget year estimates for each of the following:

(A) The maximum deficit amount, the estimated deficit calculated under section 903(b) of this title, the excess deficit, and the margin.

(B) The amount of reductions required under section 902 of this title, the excess deficit remaining after those reductions have been made, and the amount of reductions required from defense accounts and the reductions required from non-defense accounts.

(C) The sequestration percentage necessary to achieve the required reduction in defense accounts under section 903(d) of this title.

(D) The reductions required under sections 903(e)(1) and 903(e)(2) of this title.

(E) The sequestration percentage necessary to achieve the required reduction in non-defense accounts under section 903(e)(3) of this title.

The CBO report need not set forth the items other than the maximum deficit amount for fiscal year 1992, 1993, or any fiscal year for which the President notifies the House of Representatives and the Senate that he will adjust the maximum deficit amount under the option under section 903(g)(1)(B) of this title.

(5) Explanation of differences

The OMB reports shall explain the differences between OMB and CBO estimates for each item set forth in this subsection. (e) Notification regarding military personnel

On or before the date specified in subsection (a) of this section, the President shall notify the Congress of the manner in which he intends to exercise flexibility with respect to military personnel accounts under section 905(h) of this title.

(f) Sequestration update reports

On the dates specified in subsection (a) of this section, OMB and CBO shall issue a sequestration update report, reflecting laws enacted through those dates, containing all of the

information required in the sequestration preview reports.

(g) Final sequestration reports (1) Reporting requirement

On the dates specified in subsection (a) of this section, OMB and CBO shall issue a final sequestration report, updated to reflect laws enacted through those dates.

(2) Discretionary sequestration reports

The final reports shall set forth estimates for each of the following:

(A) For the current year and each subsequent year through 1998 the applicable discretionary spending limits for each category and an explanation of any adjustments in such limits under section 901 of this title.

(B) For the current year and the budget year the estimated new budget authority and outlays for each category and the breach, if any, in each category.

(C) For each category for which a sequestration is required, the sequestration percentages necessary to achieve the required reduction.

(D) For the budget year, for each account to be sequestered, estimates of the baseline level of sequestrable budgetary resources and resulting outlays and the amount of budgetary resources to be sequestered and resulting outlay reductions.

(3) Pay-as-you-go and deficit sequestration reports The final reports shall contain all the information required in the pay-as-you-go and deficit sequestration preview reports. In addition, these reports shall contain, for the budget year, for each account to be sequestered, estimates of the baseline level of sequestrable budgetary resources and resulting outlays and the amount of budgetary resources to be sequestered and resulting outlay reductions. The reports shall also contain estimates of the effects on outlays of the sequestration in each outyear through 1998 for direct spending programs.

(4) Explanation of differences

The OMB report shall explain any differences between OMB and CBO estimates of the amount of any net deficit change calculated under subsection 1 902(b) of this title, any excess deficit, any breach, and any required sequestration percentage. The OMB report shall also explain differences in the amount of sequesterable resources for any budget account to be reduced if such difference is greater than $5,000,000.

(5) Presidential order

On the date specified in subsection (a) of this section, if in its final sequestration report OMB estimates that any sequestration is required, the President shall issue an order fully implementing without change all sequestrations required by the OMB calculations set forth in that report. This order shall be effective on issuance.

1 So in original. Probably should be "section".