The House of Representatives focused this week on altering the Congressional budget process. On January 23, the House Committee on the Budget approved three bills that would modify the budget process by projecting economic growth, eliminating inflation calculations and changing accounting practices. The Committee’s approval of these bills reflects the House Republican leadership’s criticism of the Congressional approach to fiscal decisions in recent years.
H.R. 3582, the Pro-Growth Budgeting Act of 2011 introduced by Representative Tom Price (R-GA), would require that the Congressional Budget Office (CBO) provide a macroeconomic impact analysis for budget-related legislation. The committee would require that such analysis accompany legislation for which it is estimated there would be a change in the projected gross domestic product of greater than .25%. The analysis would include economic projections that opponents of this strategy, called dynamic scoring, argue would be unreliable and based on partisan assumptions.
The Committee also passed the Baseline Reform Act of 2011, H.R. 3578, which would prohibit CBO from calculating inflation as part of spending projections. The bill, introduced by Representative Robert Woodall (R-GA), would also require CBO to submit a budget outlook that projects 40 years ahead without inflation, rather than the 30 year projection incorporating inflation that CBO currently provides to Congress.
The third bill the Committee approved, H.R. 3581, the Budget and Accounting Transparency Act of 2011, was introduced by Representative Scott Garrett (R-NJ) in December. H.R. 3581 would change the accounting processes used in assessing the cost of federal credit programs. The bill could inflate the cost of credit programs by requiring that a “fair value basis” be used to estimate costs, which could be higher than the actual costs the government incurs in administering the credits.
Also on January 23, the House Committee on Rules approved the Legally Binding Budget Act of 2011, H.R. 3575, though the Committee on the Budget did not take up the bill. H.R. 3575 would change the concurrent budget resolution to a joint resolution which would require both houses of Congress to agree to, and the President to sign into law, a budget resolution. The concurrent resolution used under the current budget process is not signed by the President and is not legally binding, instead acting as a framework that each House of Congress uses to craft its appropriations bills. This bill is expected to be taken up by the Committee on the Budget in the near future.
The Committee on Rules also considered H.R. 114, the Biennial Budgeting and Appropriations Act of 2011, which would require Congress to shift from an annual budget and appropriations process to a biannual process. The bill would require the President to submit a two-year budget proposal and Congress would follow with a two-year budget resolution and two-year appropriations bills. Proponents of the bill claim this would free up Congress’ time to work on authorizing legislation during the second year of the budget cycle. Opponents say it not be possible to accurately anticipate costs for a two-year cycle, and would cause shortfalls in program funding and other budgetary challenges.
On January 24, the House of Representatives also passed a resolution, H.Res. 516, expressing the sense of the House that, “the passage of a fiscal year 2013 Federal budget is of national importance.” House Republicans used this resolution as a way to criticize Senate leadership for its lack of traditional budget work in FY12. The House of Representatives passed a budget resolution early in 2012 while the Senate Committee on Budget worked on but never passed a budget resolution. Also on January 24, the Senate Committee on Budget issued a “fact sheet” in response to H.Res. 516, defending itself against Republican claims that the Senate did not pass a budget. The fact sheet claims that the Senate did pass a budget in the form of the Budget Control Act (BCA) of 2011, passed in August 2011. The Committee on Budget asserts that the BCA is in fact “more extensive than a traditional budget,” with enforcement mechanisms not included in annual budget resolutions. The Committee on Budget also states that the BCA is more comprehensive as it provides a budget framework for 10 years instead of just the upcoming fiscal year.
Congress’ budget work will continue the week of January 30 after CBO releases its Budget and Economic Outlook report on January 31. The House Committee on the Budget will hold a Budget and Economic Outlook hearing on February 1 at 10 am in room 210 of the Cannon House office building. The Senate Committee on the Budget will then hold a Budget and Economic Outlook hearing on February 2 at 10 am in room 608 of the Dirksen Senate office building. CBO director Douglas Elmendorf will testify at both hearings.
View the bills: http://www.rules.house.gov/Legislation/Bills.aspx
View the Senate Committee on Budget fact sheet: http://1.usa.gov/xeVca3