H.Con.Res. 25: a concurrent resolution establishing the budget for the United States Government for fiscal year 2014 and setting forth appropriate budgetary levels for fiscal years 2015-2023

H.Con.Res. 25

a concurrent resolution establishing the budget for the United States Government for fiscal year 2014 and setting forth appropriate budgetary levels for fiscal years 2015-2023

Sponsor
Rep. Paul Ryan

Date
March 19, 2013 (113th Congress, 1st Session)

Staff Contact
Communications

Floor Situation

On Tuesday, March 19, 2013, the House will consider H.Con.Res. 25, a concurrent resolution establishing the budget for the United States Government for FY 2014 and setting forth appropriate budgetary levels for fiscal years 2014 through 2023, under a rule.  The budget resolution was released on March 12, 2013 by Budget Committee Chairman, Paul Ryan (R-WI).   It was marked up on March 13, 2013 and reported out of the House Budget Committee by a vote of 22-17. 

Bill Summary

H.Con.Res. 25 establishes the budget for FY 2014 and budget levels for fiscal years 2014 through 2023.  The House budget resolution achieves balance by 2023, reducing spending by $4.6 trillion over the next ten years.  The House budget reaches this goal by addressing six key areas.

First, the budget proposes to simplify the tax code by establishing two rates – 10 and 25 percent – as well as repealing the alternative minimum tax; reducing the corporate rate to 25 percent; and transitioning to a territorial tax system. 

The budget resolution strengthens our federal safety net and welfare programs – repealing the Medicaid expansion and exchange subsidies authorized in the health care law.  At the same time, states are given greater flexibility to develop their own Medicaid programs as well as customize the Supplemental Nutrition Assistance Program (SNAP).  The budget resolution also reinstates the work requirement in the Temporary Assistance for Needy Families (TANF) program.

H.Con.Res. 25 preserves the existing Medicare program for those who are 55 and above and reforms it for future generations.  In addition, the budget repeals the Independent Payment Advisory Board (IPAB); reforms the medical liability system, and allows for means-tested premiums for high-income seniors.  With respect to Social Security, the budget establishes a trigger at which time the President is required to submit a plan that would achieve actuarial balance over the next 75 years.  The budget resolution also proposes reforms to civil service pensions – increasing federal employee contributions for retirement to half of the contribution (50-50 split between employee and employer).

The budget resolution calls for increased domestic energy exploration; restores competition to the energy sector; winds down Fannie Mae and Freddie Mac, and requires more accurate accounting as it relates to all federal loans and guarantees.  It also repeals Dodd Frank as well as the President’s health care law in their entirety. The budget reestablishes national security as a top priority – providing $579.2 billion for the equipment, training and compensation needed for continued success. The resolution also provides full funding for veterans, preserving our commitment to them.

Finally, the resolution makes needed reforms to the budget process, including extending current federal spending caps through the end of the budget window; creating a budget point of order against bills that increase net mandatory spending beyond the ten year window; authorizing the use of fair value estimates for credit programs; and calling on congressional committees to regularly review programs for waste fraud and abuse. 

It is also important to note that the budget resolution contains reconciliation instructions directing eight House authorizing committees to provide “at least” one billion dollars in deficit reduction over the 2014-2023 time period.

 

H.Con.Res. 25 by the Numbers

Total Spending (2014-2023)

$41.5 trillion

Total Spending Change (2014-2023)

$4.6 trillion decrease

Total Revenues (2014-2023)

$40. 2 trillion           

Total Deficit Reduction (2014-2023)

$ 4.6 trillion decrease

Surplus (2014-2023)

$7 billion surplus in 2023

Total Discretionary Budget Authority

$966 billion for FY 2014

$10.8 trillion over ten years (2014-2023)

Long term budget

Recommends revenue and spending targets of 19.1 percent of GDP for FY 2030, 2040, and 2050

Social Security

Proposes legislation that would establish a trigger requiring the President to submit legislation that would shore up Social Security trust fund

Health Care

Repeal President’s health care law – saving a total of $1.8 trillion over ten years including a repeal of Medicaid expansions saving $636 billion; repeal exchange subsidies saving $1.1 trillion and $23 billion in savings from other provisions

Block grant Medicaid at FY 2012 levels indexed to CPI and population growth saving $810 billion; implementing medical liability reform and additional income-relating provisions in Medicare saving $129 billion over ten years; converting Medicare to premium support system in 2024 for workers born in 1959 or later. New program capped at GDP plus .5 percent

Other Mandatory Spending Reductions

Elimination of categorical eligibility for food stamps and LIHEAP loophole.  Block grant SNAP beginning in 2019 and places a five year time limit on participation saving $135 billion

Increase federal employee contributions to 50-50 employee-employer split saving $132 billion

Ends mandatory spending for Pell grants saving $98 billion and converts the program to discretionary funding while maintaining the current maximum award level

Reform farm bill direct payments saving $32 billion

Background

The Congressional Budget Act of 1974 sets out the congressional budget process, including requiring Congress to write a budget each year.  “The budget resolution is the only piece of legislation that views the federal government as a whole.”[1]   Congress implements the budget resolution’s policies through action on the debt ceiling, annual appropriations acts, and direct spending bills.[2]  

Last Congress, the House passed H.Con.Res. 34 by a vote of 235-193 (Roll Call#277) and H.Con.Res. 112 by a vote of 228-191 (Roll Call#151).   However, the Senate failed to pass a budget during the 112th Congress.  In fact, the Senate last passed a budget on April 29, 2009 during the 111th Congress.[3]    Moreover, the President has yet to submit his FY 2014 budget. The first and last timely budget submission made by the President occurred on February 1, 2010.   As a result, over the last several years, the budget, appropriations, and debt ceiling discussions have been consumed by fiscal deadlines and crisis. 

In the 113th, the House has sought to reestablish order, through H.R. 325, No Budget, No Pay Act and H.R. 444, Require a Plan Act.  H.Con.Res. 25 is another step in the process building on the two previous budgets – improving the lives of every individual – by achieving balance in ten years.  In an article published in the Wall Street Journal, economists John F. Cogan and John B. Taylor report that implementing H.Con.Res. 25 would “raise gross domestic product by one percentage point in 2014 equivalent to about a $1500 increase for each household.  Ten years from now, at the end of the official budget horizon, we estimate that the entire plan would raise GDP by three percentage points, or more than $4000 per each U.S. household.” [4]



[2] See CRS Introduction to the Federal Budget Process, December 3, 2012.

[3] See http://nation.foxnews.com/budget/2013/01/08/1350-days-senate-passed-budget.  As of March 19, 2013, it has been 1420 days since the Senate passed a budget.

Cost

There is no score associated with the budget resolution. 

Amendments

A seperate Legislative Digest will describe the substitute amendments made in order by the Rules Committee.