H.R. 2920 Amendment: Amendment to H.R. 2920 - Statutory Pay-As-You-Go Act of 2009

H.R. 2920

Amendment to H.R. 2920 - Statutory Pay-As-You-Go Act of 2009

Sponsor
Rep. Steny H. Hoyer

Date
July 22, 2009 (111th Congress, 1st Session)

Staff Contact
Communications

Floor Situation

The House is scheduled to consider H.R. 2920, on Wednesday, July 22, 2009, under a structured rule (H.Res. 665).  The rule provides for one hour of general debate, one motion to recommit, and makes the following amendment in order.   For more information on the underlying bill, please see today's Legislative Digest.

 

Bill Summary

1) Ryan (R-WI):  The amendment in the nature of a substitute would replace the Democrat bill with real caps on discretionary spending for each of the next five years.  In addition, the amendment would establish new limits on all spending (which includes mandatory and discretionary spending) and set a cap on annual deficits.

Discretionary Spending Limits:  The amendment caps FY 2010 discretionary budget authority at CBO's current baseline levels.  The amendment would limit spending increases in the following four years to grow with inflation.  The limits would be waived if the President and Congress designate discretionary spending as "emergency" spending.  In addition, the amendment provides a separate category for funding overseas contingency operations related to the Global War on Terror and makes the fund exempt from being sequestered.

Total Spending Limits:  The substitute places new statutory limits on total spending based on Gross Domestic Product (GDP).  Under the amendment total spending would be capped at 24.6 percent of GDP in FY 2010, which would be reduced to 21.7 percent of GDP for every subsequent year after FY 2015.

Deficit Limits:  The amendment also limits the maximum annual deficit, beginning in FY 2010, to a percentage of GDP based on estimates from the Office of Management and Budget.  Under the amendment, the deficit limit would begin at 8 percent of GDP in FY 2010 and lower to 3 percent of GDP from FY 2013 through FY 2019.  According to the most recent estimates, the FY 2009 deficit is almost 13 percent of GDP.

Spending Reduction Orders:  The amendment requires OMB to issue spending reduction orders to sequester funds from eligible spending accounts by a uniform amount to reduce outlays and eliminate excess spending.  The amendment makes the following accounts exempt from these reductions: payments for net interest, veterans programs, obligated balances, constitutional obligations, Unemployment Insurance, emergency legislation, and overseas contingency operations.

Eliminates Automatic Tax Increases:  Finally, the amendment assumes that under the baseline all tax relief provisions enacted in 2001 and 2003, as well as the alternative minimum tax (AMT) patch, are extended permanently.