Congressional Budget Actions in 2005

Congressional Budget Actions in 2005

Order Code RL32791
CRS Report for Congress
Received through the CRS Web
Congressional Budget Actions in 2005
Updated January 20, 2006
Bill Heniff Jr.
Analyst in American National Government
Government and Finance Division
Congressional Research Service ˜ The Library of Congress

Congressional Budget Actions in 2005
Summary
During the first session of the 109th Congress, the House and Senate considered
many different budgetary measures. Most of them pertained to fiscal year (FY) 2006
and beyond, but some made adjustments to the budget for FY2005. This report
describes House and Senate actions on major budgetary legislation within the
framework of the congressional budget process and other procedural requirements.
Congress typically begins its annual budget process once the President submits
his budget for the upcoming fiscal year. President George W. Bush submitted his
FY2006 budget to Congress on February 7, 2005.
The congressional budget process provides for an annual concurrent resolution
on the budget to serve as a framework for the consideration of budgetary legislation.
The budget resolution sets forth aggregate spending and revenue levels, and spending
levels by major functional area, for at least five fiscal years. Budget resolution
policies are implemented through the enactment of reconciliation bills, revenue and
debt-limit legislation, and appropriations and other spending measures. They are
enforced by points of order that may be raised when legislation is pending on the
House and Senate floor.
The House considered its version of the FY2006 budget resolution (H.Con.Res.
95) over a period of two days, March 16 and 17. After considering and rejecting four
amendments the House agreed to H.Con.Res. 95 by a vote of 218-214 on March 17.
The Senate considered its version (S.Con.Res. 18) over a period of four days, March
14-17. After considering several amendments, adopting most and rejecting others,
the Senate agreed to S.Con.Res. 18, as amended, by a vote of 51-49 on March 17.
The House and Senate, subsequently, agreed to the conference report to the FY2006
budget resolution (H.Rept. 109-62) by votes of 214-211 and 52-47, respectively, on
April 28.
The FY2006 budget resolution provided for three reconciliation measures: (1)
to cut direct (or mandatory) spending by about $35 billion; (2) to cut taxes by $70
billion; and (3) to increase the statutory debt limit by $781 billion. When the
Congress adjourned sine die on December 22, 2005, the House and Senate had
passed but had not completed action on spending (S. 1932/H.R. 4241) and tax (H.R.
4297/S. 2020) reconciliation measures. No action was taken on a debt-limit
reconciliation measure.
When FY2006 began on October 1, the House had passed 11, and the Senate
had passed eight, of the regular appropriations acts for FY2006. Only two of these
had been signed into law. Congress completed action on the regular appropriations
acts for FY2006 when the Senate, on December 21, agreed to the conference reports
to the Defense Appropriations Act (H.R. 2863, H.Rept. 109-359) and the Labor,
Health and Human Services, and Education Appropriations Act (H.R. 3010, H.Rept.
109-337).
This report will no longer be updated.

Contents
Concluding Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Overview of the Congressional Budget Process . . . . . . . . . . . . . . . . . . . . . . . . . . 2
The President’s Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
The Budget Resolution: Implementation and Enforcement . . . . . . . . . 3
Expired Budget Enforcement Procedures . . . . . . . . . . . . . . . . . . . . . . . 5
Budget Resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Reconciliation Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Spending Reconciliation Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Revenue Reconciliation Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Statutory Debt Limit Reconciliation Legislation . . . . . . . . . . . . . . . . . 18
Revenue and Debt-Limit Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Revenue Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Debt-Limit Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Appropriations and Other Spending Legislation . . . . . . . . . . . . . . . . . . . . . . . . . 22
Discretionary Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Mandatory Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Chronology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
For Additional Reading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Congressional Hearings, Reports, and Documents . . . . . . . . . . . . . . . . . . . 33
CRS Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
List of Figures
Figure 1. Actual FY2004 Revenues by Source . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Figure 2. Actual FY2004 Outlays by Major Spending Category . . . . . . . . . . . . 23
List of Tables
Table 1. The Congressional Budget Process Timetable . . . . . . . . . . . . . . . . . . . . 4
Table 2. Mapping Spending and Revenue Legislation through the
Congressional Budget Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Table 3. Budget Baselines, FY2005-FY2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Table 4. Comparison of Selected Components of the House, Senate,and
Conference Versions of the FY2006 Budget Resolution . . . . . . . . . . . . . . . 12
Table 5. Reconciliation Directives to House and Senate Committees
Contained in the FY2006 Budget Resolution . . . . . . . . . . . . . . . . . . . . . . . 14

Congressional Budget Actions in 2005
Concluding Actions
The Congress adjourned sine die on December 22, 2005. Prior to adjourning,
the Congress completed action on the regular appropriations acts for FY2006 when
the Senate, on December 21, agreed to the conference reports to the Defense
Appropriations Act (H.R. 2863, H.Rept. 109-359) and the Labor, Health and Human
Services, and Education Appropriations Act (H.R. 3010, H.Rept. 109-337). On
December 30, President Bush signed H.R. 2863 and H.R. 3010 into law (P.L. 109-
148 and P.L. 109-149, respectively), thereby bringing action on the FY2006 regular
appropriations acts to a close.
The Congress, however, did not complete action on the three reconciliation
measures provided for in the FY2006 budget resolution. On December 19, 2005, the
House agreed to the conference report on the spending reconciliation measure (S.
1932, the Deficit Reduction Act of 2005). In the Senate, however, the conference
report failed when a point of order under the Byrd rule (Section 313 of the Budget
Act) against three provisions in the conference report was sustained. Subsequently,
the Senate on December 21 agreed to a motion to concur in the House amendment
to S. 1932 with a further amendment containing the text of the conference report with
the violating provisions stricken. The House did not act on the further amendment
to S. 1932 before adjourning sine die. The House is expected to consider the further
amendment some time after it returns for the second session of the 109th Congress the
week of January 31, 2006.
The Senate passed the revenue reconciliation measure (S. 2020, the Tax Relief
Act of 2005) in the early morning of November 18. The House passed its revenue
reconciliation measure (H.R. 4297, the Tax Relief Extension Reconciliation Act of
2005) on December 8. Before adjourning sine die, the Senate and the House did not
take any further action on these revenue reconciliation measures.
Neither the House or the Senate took action on a reconciliation measure
changing the statutory limit on the public debt.
Introduction
During the first session of the 109th Congress, the House and Senate considered
many different budgetary measures. Most of them pertained to FY2006 (referred to
as the “budget year”) and beyond. In addition, some made adjustments to the budget
for FY2005 (referred to as the “current year”). This report describes House and

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Senate action on major budgetary legislation within the framework of the
congressional budget process and other procedural requirements.1
Within this procedural framework, Congress considered various budget-related
legislation in the context of what was arguably an unfavorable budget outlook.
According to the Office of Management and Budget (OMB) and the Congressional
Budget Office (CBO), current budget projections under existing law, without any
legislative changes, showed annual deficits in the unified budget (i.e., including
federal funds and trust funds) in each of the next several fiscal years. For example,
at the beginning of the year, OMB projected that the FY2005 unified budget deficit
would be $390 billion ($427 billion if the supplemental request is included), with
deficits continuing but declining through FY2010. Similarly, CBO projected that the
FY2005 unified budget deficit would be $368 billion, with a surplus not returning
until FY2012.2
Overview of the Congressional Budget Process
The congressional budget process consists of the consideration and adoption of
spending, revenue, and debt-limit legislation within the framework of an annual
concurrent resolution on the budget.
The President’s Budget. Congress begins its budget process once the
President submits his budget. The President is required by law to submit a
comprehensive federal budget no later than the first Monday in February (31 U.S.C.
1105). The President’s budget includes estimates of direct spending and revenues
under existing laws (with certain adjustments), as well as estimates of any proposed
legislative changes affecting direct spending and revenues. In addition, the
President’s budget contains requests, in specific dollar amounts, for discretionary
spending (i.e., funds controlled through the appropriations process) for the upcoming
fiscal year. Although Congress is not bound by the President’s budget, congressional
action on spending and revenue legislation often is influenced by his
recommendations, as well as subsequent budgetary activities by the President during
the year. OMB assists the President in formulating and coordinating his budget
policies and activities.
On February 7, 2005, President Bush submitted his FY2006 budget to Congress.
As is the usual practice, the President’s budget was submitted as a multi-volume set
consisting of a main document that includes the President’s budget message and
information on his 2006 proposals (Budget) and supplementary documents that
1 For information on budget actions during the second session of the 108th Congress, see
CRS Report RL32246, Congressional Budget Actions in 2004, by Bill Heniff Jr.
2 For further information on the current budget deficit projections, see (1) Office of
Management and Budget, Budget of the U.S. Government, Fiscal Year 2006 (Washington:
GPO, 2005), Table S-1, pp. 343, 363; (2) Congressional Budget Office, The Budget and
Economic Outlook: Fiscal Years 2006-2015 (Washington: CBO, 2005), Summary Table
1, p. xiv; and (3) CRS Report RL32812, The Budget for Fiscal Year 2006, by Philip D.
Winters.

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provide special budgetary analyses (Analytical Perspectives), historical budget
information (Historical Tables), and detailed account and program level information
(Appendix), among other things.3 In addition, on February 11, OMB made available
a supplementary document, Major Savings and Reforms in the President’s 2006
Budget, outlining program terminations and reductions proposed in the President’s
FY2006 budget.
The President may revise his budget request any time during the year. Revisions
requested before Congress has acted on the initial request are submitted as budget
amendments. In addition, the President also may request supplemental
appropriations for the current fiscal year for unanticipated needs. During 2005,
President Bush submitted five budget amendments, five requests for supplemental
appropriations for FY2005, one request for supplemental appropriations for FY2006,
one request reallocating supplemental appropriations, and one request for a package
of rescissions (see section “Discretionary Spending,” below).4
By July 15 of each year, the President is required to submit an update of his
budget, commonly referred to as the mid-session review.5 On July 13, 2005,
President Bush submitted his Mid-Session Review of the budget to Congress. The
report contains revised estimates of the budget deficit/surplus, receipts, outlays, and
budget authority for FY2005 through FY2010, reflecting changed economic
conditions and assumptions and congressional actions.
The Budget Resolution: Implementation and Enforcement. The
Congressional Budget Act of 1974 (Titles I-IX of P.L. 93-344, 88 Stat. 297-332)
established the congressional budget process, including a timetable for congressional
action on budgetary legislation (see Table 1). The congressional budget process
provides for an annual concurrent resolution on the budget to serve as a framework
for the consideration of budgetary legislation. The budget resolution sets forth
aggregate spending and revenue levels, and spending levels by major functional area,
for at least five fiscal years. As a concurrent resolution, the budget resolution is not
presented to the President for his signature, and thus does not become law. Instead,
it is an agreement between the House and Senate on a congressional budget plan,
providing a framework for subsequent legislative action on the budget during each
congressional session.
3 All of the President’s FY2006 budget documents are available at
[http://www.gpoaccess.gov/usbudget/fy06/browse.html].
4 These requests are available at [http://www.gpoaccess.gov/usbudget/fy06/amndsup.html].
5 For background information on the mid-session review, see CRS Report RL32509, The
Mid-Session Review of the President’s Budget: Timing Issues, by Robert Keith.

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Table 1. The Congressional Budget Process Timetable
Date
Action
First Monday in February
President submits budget to Congress.
February 15
Congressional Budget Office submits economic and
budget outlook report to Budget Committees.
Six weeks after President
Committees submit views and estimates to Budget
submits budget
Committees.
April 1
Senate Budget Committee reports budget resolution.
April 15
Congress completes action on budget resolution.
May 15
Annual appropriations bills may be considered in the
House, even if action on budget resolution has not been
completed.
June 10
House Appropriations Committee reports last annual
appropriations bill.
June 15
House completes action on reconciliation legislation (if
required by budget resolution).
June 30
House completes action on annual appropriations bills.
July 15
President submits mid-session review of his budget to
Congress.
October 1
Fiscal year begins.
Source: Section 300 of the Congressional Budget Act of 1974, as amended (P.L. 93-344, 2 U.S.C. 631).
Budget resolution policies are implemented through the enactment of revenue
and debt-limit legislation, appropriations and other spending measures, and, if
required by the budget resolution, one or more reconciliation bills (see Table 2).
Congress enforces budget resolution policies through points of order on the floor of
each chamber and the reconciliation process. For example, any legislation that would
cause the aggregate levels to be violated is prohibited from being considered.
Further, the total budget authority and outlays set forth in the budget resolution are
allocated among the House and Senate committees having jurisdiction over specific
spending legislation. Any legislation, or amendment, that would cause these
committee allocations to be exceeded is prohibited. Finally, the House and Senate
Appropriations Committees subdivide their allocations among their respective
subcommittees. A point of order may be raised against any appropriations act, or

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amendment, that would cause one of these subdivisions to be exceeded.6 The budget
resolution also contains spending levels by functional categories (e.g., national
defense), but these are not enforceable. Congress also may use reconciliation
legislation (discussed further below) to enforce the direct spending, revenue, and
debt-limit provisions of a budget resolution.
In addition, the Senate is constrained by limits on discretionary spending and a
“pay-as-you-go” (PAYGO) requirement for direct spending and revenue legislation,
which are enforced through points of order while legislation is being considered on
the Senate floor (both explained further below). The House does not provide for
similar points of order.
Expired Budget Enforcement Procedures. For FY1991 through
FY2002, Congress and the President also were constrained by statutory limits on
discretionary spending and a statutory PAYGO requirement for direct spending and
revenue legislation.7 Unlike the enforcement procedures associated with the budget
resolution, which are employed while legislation is considered on the floor of each
chamber, the discretionary spending limits and PAYGO requirement were enforced
by a sequestration process, generally after legislative action for a session of Congress
ended. If either of these budget constraints were violated, then the President was
required to order a sequestration, which involved largely across-the-board spending
cuts in non-exempt programs, by the amount of any violation. These budget
enforcement mechanisms, however, expired at the end of FY2002 (i.e., September
30, 2002).
President Bush, among others, has proposed setting new discretionary spending
limits and restoring a modified version of the PAYGO requirement, in addition to
several other budget process reforms.8 If Congress and President Bush enact budget
enforcement procedures such as these applicable to budget legislation in 2005, this
report will incorporate them accordingly.
6 For more detailed information on these points of order and their application, see CRS
Report 97-865, Points of Order in the Congressional Budget Process, by James V. Saturno.
7 These constraints were first established by the Budget Enforcement Act of 1990 (Title XIII
of P.L. 101-508, Omnibus Budget Reconciliation Act of 1990, 104 Stat. 1388-573-1388-
630), which amended the Balanced Budget and Emergency Deficit Control Act of 1985
(Title II of P.L. 99-177, 99 Stat. 1038-1101).
8 In his FY2006 budget, President Bush proposed to set discretionary spending limits for
FY2006 through FY2010 and to restore the PAYGO requirement for direct spending
legislation only, among other budget reform initiatives. See Office of Management and
Budget, Analytical Perspectives, Budget of the U.S. Government, Fiscal Year 2006, pp. 235-
242. For a contextual discussion of budget process reform, see CRS Report RS21752,
Federal Budget Process Reform: A Brief Overview, by Bill Heniff Jr. and Robert Keith.

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Table 2. Mapping Spending and Revenue Legislation through the Congressional Budget Process
The annual budget resolution functions as the centerpiece of the congressional budget process by setting forth aggregate spending and revenue levels for at least five fiscal years. Budget resolution policies are implemented
through the enactment of appropriations and other spending measures, revenue legislation, and, if required by the budget resolution, one or more reconciliation bills. Each of these types of measures follows a separate process
but must comply with the budget policies set forth in the budget resolution.
Discretionary spending policies in the budget resolution are implemented through the appropriations process.
Annual Appropriations Process: Congress considers and adopts each year regular appropriations acts providing budgetary authority for the upcoming fiscal year.
Full Appropriations Committee
E a c h o f t h e
F u l l A p p r o p r i a t i o n s
F u l l c h a m b e r
House and Senate
House and Senate
President signs each
subdivides its spending allocation
a p p r o p r i a t i o n s
Committee reports each
c o n s i d e r s a n d
resolve differences
separately agree to
appropriations act, or
[302(a) allocation] among its
subcommittees holds
appropriations act, which must
a d o p t s e a c h
i n c o n f e r e n c e
conference report to
a n o m n i b u s
s u b c o m m i t t e e s [ 3 0 2 ( b )
hearings and drafts a
not exceed the respective
appropriations act.
committees.
each appropriations
appropriations act,
allocations].
r
e
g u
l
a
r
302(b) allocation.
act. From time to
into law.
appropriations act.
time, Congress merges
two or more regular
appropriations acts
into an omnibus
appropriations act.
Mandatory spending, revenue, and debt-limit policies in the budget resolution are implemented through the regular legislative process or the reconciliation process.
Regular legislative process: Congress may consider and adopt individual mandatory spending, revenue, or debt-limit legislation.
Each legislative committee
Each committee may report to its parent
Full chamber considers
House and Senate resolve
House and Senate separately
President signs individual
may hold hearings and
chamber mandatory spending or revenue
ind ivid ua l ma nd atory
differences in conference
agree to conference reports
mandatory spending or
c o ns id e r l e g i s l a t i o n
legislation, which must not (1) cause
spe nding or re venue
committees.
to individual mandatory
revenue legislation into
referred to it or draft
direct spending under the committee’s
legislation.
spending or revenue
law.
original legislation.
jurisdiction to exceed its spending
legislation.
ceiling [302(a) allocation]; (2) cause
revenues to fall below the revenue floor
set forth in the budget resolution; or (3)
violate the Se na te ’ s PAYGO
requirement.
Reconciliation Process: Congress may include in the budget resolution reconciliation instructions directing one or more committees to recommend legislative changes to existing law in order to bring mandatory spending,
revenues, the debt-limit, or a combination of these, into compliance with the budget resolution policies.
Each legislative committee directed to do so
Budget Committee packages the
Full chamber considers
House and Sena te
House and Senate
P r e s i d e n t s i g n s
recommends legislative changes to existing law
c o m m i t t e e s ’ l e g i s l a t i v e
a n y o m n i b u s
resolve differences in
separately agree to
o
m n i b
u s
to achieve the mandatory spending or revenue
recommendations into one or more
reconciliation measure
conference committee.
conference report to
r e c o n c i l i a t i o n
levels set forth in the budget resolution and
omnibus reconciliation measures,
under special procedures
omnibus reconciliation
legislation into law.
submits these reconciliation recommendations
“without any substantive revision.”
that limit the measure’s
legislation.
to the Budget Committee by a date certain.
contents and floor debate.

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Budget Resolution
The Congressional Budget Act, as amended, establishes the concurrent
resolution on the budget as the centerpiece of the congressional budget process.9 The
budget resolution sets forth aggregate spending and revenue levels, and spending
levels by major functional area, for at least five fiscal years. Once adopted, it
provides the framework for subsequent action on budget-related legislation.
Following the submission of the President’s budget early in the year, Congress
begins formulating the budget resolution. The House and Senate Budget Committees
are responsible for developing and reporting the budget resolution. In formulating
it, the Budget Committees hold hearings and receive testimony from Members of
Congress and representatives of federal departments and agencies, the general public,
and national organizations. Two regular hearings include separate testimony from
the CBO director and the OMB director. On February 1, 2005, CBO Director
Douglas Holtz-Eakin presented CBO’s baseline budget projections for FY2006-
FY2015 during testimony to the Senate Budget Committee.10 On February 8 and 9,
OMB Director Joshua B. Bolten provided an overview of President Bush’s budget
request before the House and Senate Budget Committees, respectively.11
The congressional budget resolution, like the President’s budget, is based on
budget baselines (see Table 3).12 The budget baseline is a projection of federal
revenue, spending, and deficit or surplus levels based upon current policies, assuming
certain economic conditions. Baseline projections provide a benchmark for
measuring the budgetary effects of proposed policy changes. The President’s budget
baseline, referred to as current services estimates, is included in the budget
documents submitted to Congress.13 The President’s baseline usually differs from
CBO’s baseline, referred to as baseline budget projections, because of different
economic and technical assumptions. In preparation for action on the FY2006 budget
resolution, on January 25, 2005, CBO released its annual report on budget baseline
9 For historical information on budget resolutions, see CRS Report RL30297, Congressional
Budget Resolutions: Selected Statistics and Information Guide, by Bill Heniff Jr.
10 Mr. Holtz-Eakin’s written testimony to the Senate Budget Committee is available at
[http://www.cbo.gov/ftpdocs/60xx/doc6065/Outlook2006-2015Testimony.pdf].
11 Mr. Bolton’s written testimony to the House Budget Committee is available on its website,
at [http://www.house.gov/budget/hearings/boltenstmnt020805.pdf]; his written testimony
to the Senate Budget Committee is available on its website, at [http://www.senate.gov/
~budget/republican/hearingarchive/testimonies/2005/20050209-OMB.pdf].
12 For further information on the current budget baseline projections, see CRS Report
RL32812, The Budget for Fiscal Year 2006, by Philip D. Winters.
13 See the summary table S-11 in the main Budget volume, p. 363, and chapter 25 of the
Analytical Perspectives volume, pp.389-404, for the current services estimates. Office of
Management and Budget, Budget of the U.S. Government, Fiscal Year 2006.

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projections, The Budget and Economic Outlook: Fiscal Years 2006-2015.14
Subsequently, on March 8, CBO released its revised budget baseline projections in
its report An Analysis of the President’s Budgetary Proposals for Fiscal Year 2006.
The report also contains estimates of the President’s proposals using CBO’s
economic and technical assumptions, and provides an analysis of the potential
macroeconomic effects of the President’s budgetary proposals.
Table 3. Budget Baselines, FY2005-FY2010
(in billions of dollars)
Total
FY2006-
FY2005
FY2006
FY2007
FY2008
FY2009
FY2010
FY2010
Office of Management and Budget — July 2005
[revised current services estimates]
Outlays
2,471
2,571
2,666
2,767
2,884
3,031
13,919
Revenues
2,140
2,273
2,429
2,598
2,744
2,914
12,958
Surplus/Deficit (-)
-331
-299
-237
-169
-140
-117
-962
On-budget
-507
-497
-445
-398
-385
-382
-2,107
Off-budgeta
176
198
208
229
246
265
1,146
Congressional Budget Office — August 2005
[revised budget baseline projections]
Outlays
2,473
2,595
2,721
2,860
2,997
3,134
14,306
Revenues
2,142
2,280
2,396
2,526
2,675
2,817
12,695
Surplus/Deficit (-)
-331
-314
-324
-335
-321
-317
-1,612
On-budget
-507
-503
-528
-554
-556
-564
-2,706
Off-budgeta
176
189
203
219
234
248
1,094
Sources: Office of Management and Budget, Mid-Session Review, Budget of the United States Government, Fiscal Year 2006
(Washington: GPO, 2005), p. 42; Congressional Budget Office, The Budget and Economic Outlook: An Update, Aug. 2005,
p. 4.
Note: Details may not add to totals due to rounding.
a. Off-budget surpluses comprise surpluses in the Social Security trust funds as well as the net cash flow of the Postal Service.
Also in preparation for upcoming congressional budget actions, CBO released
its periodic report on the budgetary implications of policy choices, Budget Options,
on February 15. The report provides background information and the estimated 10-
year budgetary effects of 185 spending options and 53 revenue options.
Another source of input comes from the “views and estimates” of congressional
committees with jurisdiction over spending and revenues. Within six weeks after the
President’s budget submission, each House and Senate committee is required to
submit views and estimates of budget matters under its jurisdiction to its respective
Budget Committee. These views and estimates, frequently submitted in the form of
a letter to the chair and ranking minority Member of the Budget Committee, typically
include comments on the President’s budget proposals and estimates of the budgetary
impact of any legislation likely to be considered during the current session of
14 CBO documents are available at [http://www.cbo.gov/].

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Congress. The Budget Committees are not bound by these recommendations. The
views and estimates often are printed in the committee report accompanying the
budget resolution in the Senate and compiled as a separate committee print in the
House.
The budget resolution was designed to provide a framework for making budget
decisions, leaving specific program determinations to House and Senate
Appropriations Committees and other committees with spending and revenue
jurisdiction. In many instances, however, particular program changes are considered
when the budget resolution is formulated. Program assumptions sometimes are
referred to in the reports of the House and Senate Budget Committees and usually are
discussed during floor action. Although these program changes are not binding,
committees may be strongly influenced by the recommendations when formulating
appropriations bills, reconciliation measures, or other budgetary legislation.
On March 9, 2005, the House Budget Committee marked up and voted to report
the House version of the FY2006 budget resolution (H.Con.Res. 95, H.Rept. 109-17)
by a vote of 22-15. During markup, the committee considered 25 amendments to the
chairman’s mark: one amendment was adopted; 20 amendments were rejected; and
four amendments were withdrawn.15 On March 10, the Senate Budget Committee
marked up and voted to report the Senate version of the FY2006 budget resolution
(S.Con.Res. 18, S.Prt. 109-18) by a vote of 12-10. During markup, the committee
considered 26 amendments to the chairman’s mark: seven amendments were
adopted; 16 amendments were rejected; and three amendments were withdrawn.16
The congressional budget process timetable sets April 15 as a target date for
final adoption of the budget resolution.17 The Budget Act prohibits the consideration
15 For a description of the amendments and the roll call votes, see U.S. Congress, House
Committee on the Budget, Concurrent Resolution on the Budget — Fiscal Year 2006, report
to accompany H.Con.Res. 95, 109th Cong., 1st sess., H.Rept. 109-17, Mar. 11, 2005
(Washington: GPO, 2005), pp. 91-111.
16 For a description of the amendments and the roll call votes, see U.S. Congress, Senate
Committee on the Budget, Concurrent Resolution on the Budget FY2006, committee print
to accompany S.Con.Res. 18, 109th Cong., 1st sess., S.Prt. 109-18, Mar. 2005 (Washington:
GPO, 2005), pp. 52-60.
17 In years when Congress is late in adopting, or does not adopt, a budget resolution, the
House and Senate independently may adopt “deeming resolution” provisions for the purpose
of enforcing certain budget levels. Deeming resolution provisions, typically included in a
simple resolution, specify certain budget levels normally contained in the budget resolution,
including aggregate spending and revenue levels, spending allocations to House and Senate
committees, spending allocations to the Appropriations Committees only, or a combination
of these. In some cases, an entire budget resolution, earlier adopted by one chamber, may
be deemed to have been passed. Under a deeming resolution, the enforcement procedures
related to the Congressional Budget Act, discussed later in this report, have the same force
and effect as if Congress had adopted a budget resolution. For further information on
“deeming resolutions,” see CRS Report RL31443, The “Deeming Resolution”: A Budget
Enforcement Tool, by Robert Keith.
(continued...)

CRS-10
of spending, revenue, or debt-limit legislation for the upcoming year until the budget
resolution has been adopted, unless the rule is waived or set aside. The House and
Senate consider the budget resolution under procedures generally intended to
expedite final action.
In the House, the budget resolution usually is considered under a special rule,
limiting the time of debate and allowing only a few amendments, as substitutes to the
entire resolution. On March 16 and 17, the House considered H.Con.Res. 95 under
a structured rule (H.Res. 154, H.Rept. 109-19) reported by the House Rules
Committee. The special rule provided for the consideration of H.Con.Res. 95 and
made in order only the four amendments, three of which were amendments in the
nature of a substitute, printed in the House Rules Committee report. The House
agreed to H.Res. 154 by a vote of 228-196 after agreeing to order the previous
question by a vote of 230-202. During consideration of the FY2006 budget
resolution, the House rejected the four amendments made in order by the special rule.
The House subsequently agreed to H.Con.Res. 95 by a vote of 218-214.18
The Senate considers the budget resolution under the procedures set forth in the
Budget Act, sometimes as modified by a unanimous consent agreement. Debate on
the initial consideration of the budget resolution, and all amendments, debatable
motions, and appeals, is limited to 50 hours. Amendments, motions, and appeals
may be considered beyond this time limit, but without debate. (Consideration of the
conference report is limited to 10 hours.) On March 10, before the Senate began
consideration of the FY2006 budget resolution, it agreed by unanimous consent to
limit the debate to 45 hours.19 The Senate considered its version of the FY2006
17 (...continued)
In 2004, for example, Congress did not complete action on a FY2005 budget
resolution; while the House agreed to the conference report to the FY2005 budget resolution
(S.Con.Res. 95, H.Rept. 108-498), the Senate never considered it. In the absence of an
agreement, the House and Senate separately adopted “deeming resolution” provisions for
budget enforcement purposes. The House included a provision in the special rule (Section
2 of H.Res. 649) governing the consideration of the conference report to the FY2005 budget
resolution “deeming” the conference report to have been agreed to by Congress. The
Senate, in contrast, included provisions in the Defense Appropriations Act, 2005 (H.R.
4613, P.L. 108-287) setting forth the FY2005 spending allocations for the Senate
Appropriations Committee. Senate committees other than the Appropriations Committee,
however, continued to be limited by the spending allocations [302(a)s] associated with the
FY2004 budget resolution (H.Con.Res. 95, H.Rept. 108-71).
At the beginning of the 109th Congress, the House agreed to deem the FY2005 budget
resolution (S.Con.Res. 95, H.Rept. 108-498) adopted by the House during the 108th
Congress to have been adopted by the 109th Congress.
18 For the consideration and adoption of H.Res. 154 and H.Con.Res. 95, see Congressional
Record, daily edition, vol. 151 (Mar. 16 and 17, 2005), pp. H1536-H1545, H1547-H1598,
H1627-H1674.
19 Of the 45 hours, 22 hours was to be controlled by the majority and 23 hours was to be
controlled by the minority. See Congressional Record, daily edition, vol. 151 (Mar. 10,
2005), p. S2499. On Mar. 11, the Minority Leader, Senator Harry Reid, explained that the
(continued...)

CRS-11
budget resolution on March 14, 15, 16, and 17. During consideration of S.Con.Res.
18, the Senate considered 73 amendments: 48 amendments were adopted; 24
amendments were rejected; and one amendment was withdrawn. On March 17, the
Senate agreed to S.Con.Res. 18, as amended, by a 51-49 vote.20
After resolving the differences between their respective versions, the House and
Senate agreed to the conference report to accompany the FY2006 budget resolution
(H.Con.Res. 95, H.Rept. 109-62) by votes of 214-211 and 52-47, respectively, on
April 28.21 Table 4 provides a comparison of several components contained in the
House, Senate, and conference versions of the FY2006 budget resolution.
19 (...continued)
Senate “in effect, agreed to use five hours of the time on the budget” on the Friday before
the Senate began consideration of S.Con.Res. 18 on Monday, Mar. 14. See Congressional
Record, daily edition, vol. 151 (Mar. 11, 2005), p. S2505.
20 For the consideration and adoption of the Senate version of the FY2006 budget resolution,
see Congressional Record, daily edition, vol. 151 (Mar. 14-17, 2005), pp. S2587-S2641,
S2661-S2728, S2759-S2841, S2875-S2897, S2899-S2926, S2929-S2967.
21 The House considered the conference report under a special rule (H.Res. 248), which it
agreed to by voice vote, after agreeing to order the previous question by a 228-196 vote. For
the House consideration of H.Res. 248 and the conference report to H.Con.Res. 95, see
Congressional Record, daily edition, vol. 151 (Apr. 28, 2005), pp. H2693-H2716. For the
Senate consideration of the conference report to H.Con.Res. 95, see Congressional Record,
daily edition, vol. 151 (Apr. 28, 2005), pp. S4481-S4527.

CRS-12
Table 4. Comparison of Selected Components of the House, Senate,
and Conference Versions of the FY2006 Budget Resolution
(amounts in millions of dollars for FY2006, except where noted)
House version (H.Con.Res. 95)
Senate version (S.Con.Res. 18)
Conference version (H.Con.Res. 95)
Total revenues
1,589,905
1,588,646
1,589,892
Total spending
Budget
authority
2,135,290
2,141,801
2,144,384
(discretionary)
(843,020)
(848,063)
(843,020)
Outlays
2,154,404
2,145,684
2,161,420
(discretionary)
(917,053)
(916,405)
(916,836)
Deficit (on-budget)
-564,499
-557,038
-571,528
Debt subject to limit
8,635,000a
8,637,186
8,645,000
Reconciliation directives:
Two reconciliation measures:
Three reconciliation measures:
Three reconciliation measures:
(1) deadline;
(2) number of committees involved;
Submissions to slow the growth in mandatory
Spending reconciliation instructions
Spending reconciliation instructions
(3) total amount of changes
spending and to achieve deficit reduction
(1) June 6, 2005;
(1) September 16, 2005;
(1) September 16, 2005;
(2) six Senate committees;
(2) eight House and eight Senate committees;
(2) nine House committees;
(3) -2,460 (FY2006);
(3) -1,519 (FY2006);
(3) -7,847 (FY2006);
-17,006 (FY2006-FY2010)
-34,658 (FY2005-FY2010)
-68,557 (FY2006-FY2010)
Revenue reconciliation instructions
Revenue reconciliation instructions
Submission providing for changes in revenue
(1) September 7, 2005;
(1) September 23, 2005;
(1) June 24, 2005;
(2) one Senate committee;
(2) one House and one Senate committee;
(2) one House committee;
(3) -19,016 (FY2006);
(3) -11,000 (FY2006);
(3) -16,623 (FY2006);
-128,580 (FY2006-FY2010)
-70,000 (FY2006-FY2010)
-45,000 (FY2006-FY2010)
Increase in statutory debt limit
Increase in statutory debt limit
(1) September 16, 2005;
(1) September 30, 2005;
(2) one Senate committee;
(2) one House and one Senate committee;
(3) +446,464
(3) +781,000
Reserve or contingency funds (#)
1
16
10
Declaratory provisions (#)
1
28
7
Notes: Amounts are for FY2006, except where noted. The total budget amounts in the budget resolution do not include the off-budget financial transactions of the Social Security Trust Funds and the U.S. Postal Service.
a. For FY2006, the actual text of the House-passed H.Con.Res. 95 specifies $5,071,000 million for the “debt subject to limit” (Section 101(5)) and $8,635,000 million for the “debt held by the public” (Section 101(6)). Currently,
the statutory limit on the public debt is $8,184,000 million (31 U.S.C. 3101). Presumably, the actual text of the House-passed FY2006 budget resolution reflects a drafting error.

CRS-13
Reconciliation Legislation
Congress may implement changes to existing law related to direct spending,
revenues, or the debt limit through the reconciliation process, under Section 310 of
the Budget Act.22 The reconciliation process has two stages. First, Congress includes
reconciliation directives in a budget resolution directing one or more committees in
each chamber to recommend changes in statute to achieve the levels of direct
spending, revenues, debt limit, or a combination thereof, agreed to in the budget
resolution.
Second, each instructed committee develops legislative recommendations to
meet its reconciliation directives and reports its legislative recommendations to its
respective chamber directly or transmits such recommendations to its respective
budget committee. Section 310(b) of the Congressional Budget Act of 1974 (Titles
I-IX of P.L. 93-344, 88 Stat. 297-332) specifies two options for the submission of
legislative recommendations to comply with reconciliation directives: (1) if one
committee is instructed, the committee reports its legislative recommendations to its
parent chamber directly; or (2) if two or more committees are instructed, the
committees submit their legislative recommendations to their respective Budget
Committee. In the latter case, the legislative language recommended by committees
is packaged “without any substantive revision” into one or more budget
reconciliation bills, as set forth in the budget resolution, by the House and Senate
Budget Committees.
As indicated in Table 4, the conference report to the FY2006 budget resolution
(H.Con.Res. 95, H.Rept. 109-62) provides for three reconciliation measures: (1) to
cut direct (or mandatory) spending by about $35 billion; (2) to cut taxes by $70
billion; and (3) to increase the statutory debt limit by $781 billion. Table 5 provides
further information on the reconciliation directives to the House and Senate
committees. (For an extensive discussion of reconciliation legislation in 2005, see
CRS Report RL33132, Budget Reconciliation Legislation in 2005, by Robert Keith.)
During the week of September 12, 2005, the chairmen of the Senate and House
Budget Committees announced a delay in the reconciliation process so that
authorizing committees could devote their attention to Hurricane Katrina-related
legislation.23 Senator Judd Gregg, Chairman of the Senate Budget Committee (SBC),
announced that the SBC would report the omnibus spending reconciliation measure
on October 26. Similarly, Representative Jim Nussle, Chairman of the House Budget
Committee (HBC), informed authorizing committees that the HBC intended to report
the omnibus spending reconciliation measure the week of October 24, which was
later extended to the week of October 31.
22 For a full discussion of the reconciliation process, see CRS Report RL33030, The Budget
Reconciliation Process: House and Senate Procedures, by Robert Keith and Bill Heniff Jr.
23 See (1) Steven T. Dennis, “Recalibrating Reconciliation,” CQ Weekly (Sept. 19, 2005),
p. 2503; and (2) Steven T. Dennis, “House Delays Reconciliation Deadlines a Second
Time,” CQ Today (Oct. 11, 2005).

CRS-14
Table 5. Reconciliation Directives to House and Senate Committees Contained in the FY2006 Budget Resolution
Amount of Spending, Revenue, or Deficit
Amount of Spending, Revenue, or Deficit
House Committee
Increase (+) or Decrease (-)a
Senate Committee
Increase (+) or Decrease (-)a
(in millions of dollars)
(in millions of dollars)
Spending reconciliation instructions (originally due by September 16)b
Agriculture
FY2006: -173 (O)
Agriculture, Nutrition, and Forestry
FY2006: -173 (O)
FY2006-2010: -3,000 (O)
FY2006-2010: -3,000 (O)
Education and the Workforce
FY2005-2006: -992 (O)
Banking, Housing, and Urban Affairs
FY2006: -30 (O)
FY2005-2010: -12,651 (O)
FY2006-2010: -470 (O)
Energy and Commerce
FY2006: -2 (O)
Commerce, Science, and Transportation
FY2006: -10 (O)
FY2006-2010: -14,734 (O)
FY2006-2010: -4,810 (O)
Financial Services
FY2006: -30 (O)
Energy and Natural Resources
FY2006-2010: -2,400 (O)
FY2006-2010: -470 (O)
Judiciary
FY2006: -60 (O)
Environment and Public Works
FY2006: -4 (O)
FY2006-2010: -300 (O)
FY2006-2010: -27 (O)
Resources
FY2006-2010: -2,400 (O)
Finance
FY2006-2010: -10,000 (O)
Transportation and Infrastructure
FY2006: -12 (O)
Health, Education, Labor, and Pensions
FY2005-2006: -1,242 (O)
FY2006-2010: -103 (O)
FY2005-2010: -13,651 (O)
Ways and Means
FY2006: -250 (D)
Judiciary
FY2006: -60 (O)
FY2006-2010: -1,000 (D)
FY2006-2010: -300 (O)
Revenue reconciliation instructions (originally due by September 23)b
Ways and Means
FY2006: -11,000 (R)
Finance
FY2006: -11,000 (R)
FY2006-2010: -70,000 (R)
FY2006-2010: -70,000 (R)
Statutory debt limit reconciliation instructions (originally due by September 30)b
Ways and Means
Increase statutory limit on the public debt by
Finance
Increase statutory limit on the public debt by
781,000.
781,000.
Source: U.S. Congress, Committee on Conference, Concurrent Resolution on the Budget for Fiscal Year 2006, conference report to accompany H.Con.Res. 95, 109th Cong., 1st sess., H.Rept. 109-62 (Washington: GPO, 2005),
pp. 11-14.
a. The budgetary components are represented in this column by the following initials: O=outlays; R=revenues; and D=deficit. The spending directives call for changes in laws providing direct spending. Also, as noted, the
reconciliation directives instruct the House Ways and Means Committee and the Senate Finance Committee to report legislation to change the statutory limit on the public debt.
b. During the week of September 12, 2005, the chairmen of the Senate and House Budget Committees announced a delay in the reconciliation process so that authorizing committees could devote their attention to Hurricane
Katrina-related legislation. See text of report for further information on the timing of the reconciliation measures.

CRS-15
Once the reconciliation legislation is reported in the House or Senate,
consideration is governed by special procedures. These procedures serve to limit
what may be included in reconciliation legislation, prohibit certain amendments, and
encourage its completion in a timely fashion. In the House, as with the budget
resolution, reconciliation legislation usually is considered under a special rule,
establishing the time allotted for debate and what amendments will be in order. In
the Senate, debate on a budget reconciliation bill, and on all amendments, debatable
motions, and appeals, is limited to not more than 20 hours. After the 20 hours of
debate has been reached, consideration of amendments, motions, and appeals may
continue, but without debate.
In both chambers, the Budget Act requires that amendments to reconciliation
legislation be germane and not increase the deficit. Also, the Budget Act prohibits
the consideration of reconciliation legislation, or any amendment to a reconciliation
bill, recommending changes to the Social Security program. Finally, in the Senate,
Section 313 of the Budget Act, commonly referred to as the Byrd rule, prohibits
extraneous matter in a reconciliation bill.24
Spending Reconciliation Legislation. Instructed Senate committees
marked up and voted to submit their legislative recommendations pursuant to the
reconciliation directives in the FY2006 budget resolution to the Senate Budget
Committee between October 18 and 25.25 The Senate Budget Committee, on October
26, voted to report an original Senate bill, S. 1932, the Deficit Reduction Omnibus
Reconciliation Act of 2005, incorporating the committee recommendations , without
any substantive revision, by a vote of 12-10 (S.Prt. 109-37).
The Senate considered S. 1932 for four days from October 31 to November 3.
During consideration of the spending reconciliation measure, the Senate considered
42 amendments: 20 amendments were adopted; nine amendments were rejected;
nine amendments fell on points of order; and four amendments were withdrawn. On
November 3, the Senate passed S. 1932, as amended, by a 52-47 vote.26 As passed
by the Senate, according to CBO, the spending reconciliation measure was projected
24 For detailed information on the Byrd rule, see CRS Report RL30862, The Budget
Reconciliation Process: The Senate’s “Byrd Rule,” by Robert Keith.
25 For background on and actions by each Senate committee related to the reconciliation
submissions, see U.S. Congress, Senate Committee on the Budget, Deficit Reduction
Omnibus Reconciliation Act of 2005, committee print, 109th Cong., 1st sess., S.Prt. 109-37,
Oct. 2005 (Washington: GPO, 2005).
26 For the consideration and adoption of S. 1932, see Congressional Record, daily edition,
vol. 151 (Oct. 31-Nov. 3, 2005), pp. S12065-S12073, S12079-S12122, S12149-S12219,
S12291-S12345.

CRS-16
to reduce direct spending by $34.6 billion over the five-year period of FY2006-
2010.27
In the House, instructed committees marked up and voted to submit their
legislative recommendations pursuant to reconciliation directives in the FY2006
budget resolution to the House Budget Committee between September 29 and
October 28.28 The House Budget Committee, on November 3, voted to report an
original House bill, H.R. 4241, the Deficit Reduction Act of 2005, incorporating the
committee recommendations, without any substantive revision, by a vote of 21-17
(H.Rept. 109-276).
On November 17, the House considered H.R. 4241 under a closed rule (H.Res.
560, H.Rept. 109-303) reported by the House Rules Committee. The House agreed
to H.Res. 560 by voice vote, after agreeing to an amendment to the resolution by
Representative Adam Putnam by voice vote.29 The special rule provided for the
consideration of H.R. 4241 and that an amendment printed in the report of the House
Rules Committee, as modified by a provision in the special rule, be considered as
adopted. Later that day, the House passed the spending reconciliation measure, as
amended, by a vote of 217-215. Subsequently, to facilitate conference action, the
House agreed by unanimous consent to pass S. 1932, the Senate’s spending
reconciliation bill, as amended by the text of H.R. 4241, as passed by the House.30
According to CBO, the House-passed spending reconciliation measure was projected
to reduce direct spending by $49.9 billion over the five-year period of FY2006-
2010.31
The Senate and House agreed to resolve the legislative differences in the two
versions of the spending reconciliation measure (S. 1932) in a conference committee,
appointing conferees on December 15 and 16, respectively. A conference report
(H.Rept. 109-362) on S. 1932, renamed the Deficit Reduction Act of 2005, was filed
on December 19 (legislative day, December 18). The House agreed to the conference
27 [http://www.cbo.gov/ftpdocs/68xx/doc6886/SenatePassedRecon.pdf].
28 For background on and actions by each House committee related to the reconciliation
submissions, see U.S. Congress, House Committee on the Budget, Deficit Reduction Act of
2005, committee report to accompany H.R. 4241, 109th Cong., 1st sess., H.Rept. 109-276,
Nov. 7, 2005 (Washington: GPO, 2005).
29 Prior to the consideration of H.Res. 560, Representative Jim McDermott raised a point of
order against the consideration of the special rule under Section 426 of the Budget Act
(which relates to the waiving of a point of order under the Unfunded Mandates Reform Act).
Pursuant to the provisions of this section of the Budget Act, the House agreed to consider
H.Res. 560 by a vote of 224-198. See Congressional Record, daily edition, vol. 151 (Nov.
17, 2005), pp. H10531-H10534.
30 For the consideration and adoption of H.Res. 560, H.R. 4241, and S. 1932, see
Congressional Record, daily edition, vol. 151 (Nov. 17, 2005), pp. H10531-H10534,
H10537-H10749.
31 [http://www.cbo.gov/ftpdocs/68xx/doc6885/HousePassedRecon.pdf].

CRS-17
report on December 19 (legislative day, December 18) by a vote of 212-206.32
During the consideration of the conference report in the Senate, however, a point of
order under the Byrd rule (Section 313 of the Budget Act) was raised against four
provisions in the conference report. A motion to waive the point of order was
rejected by a 52-48 vote, and the point of order subsequently was sustained against
three of the four provisions in the conference report. As prescribed by the Budget
Act, upon the ruling of the presiding officer sustaining the point of order under the
Byrd rule, the Senate proceeded to consider a motion to concur in the House
amendment to S. 1932 with a further amendment containing the text of the
conference report with the violating provisions stricken. The Senate agreed to the
motion by a 51-50 vote (with Vice President Richard B. Cheney voting in the
affirmative to break the tie) on December 21, 2005.33
Before adjourning sine die, the House did not act on the further amendment to
S. 1932. The House is expected to consider the further amendment some time after
it returns for the second session of the 109th Congress the week of January 31, 2006.
Revenue Reconciliation Legislation. After completing initial action on
its version of the spending reconciliation measure, both chambers turned to
legislation implementing the revenue component of the reconciliation directives in
the FY2006 budget resolution.
On November 15, 2005, the Senate Finance Committee marked up and voted
to report an original Senate bill, S. 2020, the Tax Relief Act of 2005, by a vote of 14-
6 (without written report). The Senate considered S. 2020 on November 16, 17, and
18, passing the measure in the early morning of November 18 by a 64-33 vote.
During consideration of the revenue reconciliation measure, the Senate considered
30 amendments: seven amendments were adopted; four amendments were rejected;
18 amendments fell on points of order; and one amendment was withdrawn.34 As
passed by the Senate, according to the Joint Committee on Taxation (JCT), S. 2020
is projected to reduce revenues by $57.8 billion over the five-year period of FY2006-
2010.35
In the House, on November 15, the Ways and Means Committee marked up and
voted to report H.R. 4297, the Tax Relief Extension Reconciliation Act of 2005, with
an amendment in the nature of a substitute, by a vote of 24-15 (H.Rept. 109-304).
32 The House considered the conference report under a special rule (H.Res. 640, H.Rept.
109-636), which it agreed to by voice vote. The special rule waived all points of order
against the conference report and its consideration. For the House consideration of H.Res.
640 and the conference report to S. 1932, see Congressional Record, daily edition, vol. 151
(Dec. 18, 2005), pp. H12233-H12241, H12269-H12277.
33 The Senate considered the conference report to S. 1932 on December 19-21, 2005. See
Congressional Record, daily edition, vol. 151 (Dec. 19-21, 2005), pp. S14015-S14024,
S14068-S14069, S14073-S14164, S14202-S14221.
34 For the consideration and adoption of S. 2020, see Congressional Record, daily edition,
vol. 151 (Nov. 16-17, 2005), pp. S12923-S12940, S13072-S13145.
35 [http://www.house.gov/jct/x-82-05r.pdf].

CRS-18
On December 8, the House considered H.R. 4297 under a structured rule (H.Res.
588, H.Rept. 109-330) reported by the House Rules Committee.36 The special rule
provided for the consideration of H.R. 4297, provided that the amendment in the
nature of a substitute recommended by the Ways and Means Committee be
considered as adopted, and made in order an amendment in the nature of a substitute
offered by Representative Charles Rangel. During the consideration of H.R. 4297,
the House rejected the amendment offered by Representative Rangel by a 192-239
vote and a motion to recommit with instructions also offered by Representative
Rangel by a 193-235 vote. Subsequently, the House passed the revenue
reconciliation measure, as amended, by a vote of 234-197.37 As passed by the House,
according to the JCT, H.R. 4297 is projected to reduce revenues by $56.1 billion over
the five-year period of FY2006-2010.38
Statutory Debt Limit Reconciliation Legislation. During the first
session of the 109th Congress, neither the House or the Senate took action on a
reconciliation measure changing the statutory limit on the public debt.
Revenue and Debt-Limit Legislation
Congress may adopt individual revenue and debt-limit measures without
employing the optional reconciliation process as well.
Revenue Legislation. Revenue and debt-limit legislation is under the
jurisdiction of the House Ways and Means Committee and the Senate Finance
Committee. Article I, Section 7, of the U.S. Constitution requires that revenue
legislation originate in the House of Representatives, but the Senate has considerable
latitude to amend a revenue bill received from the House.
Most of the laws establishing the federal government’s revenue sources are
permanent and continue year after year without any additional legislative action (see
Figure 1).39 Congress, however, typically enacts revenue legislation, changing some
portion of the existing tax system or renewing expiring provisions, every year.
Revenue legislation may include changes to individual and corporate income taxes,
social insurance taxes, excise taxes, or tariffs and duties.
36 The House agreed to H.Res. 588 by voice vote.
37 For the consideration and adoption of H.Res. 588 and H.R. 4297, see Congressional
Record, daily edition, vol. 151 (Dec. 8, 2005), pp. H11227-H11264.
38 [http://www.house.gov/jct/x-81-05.pdf].
39 Chart created by CRS based on data from Congressional Budget Office, The Budget and
Economic Outlook: Fiscal Years 2006-2015 (Washington: CBO, 2005), p. 136.

CRS-19
Figure 1. Actual FY2004 Revenues by Source
Individual income taxes ($809.0 bil ion)
43%
Corporate income taxes ($189.4 bil ion)
10%
Excise taxes ($69.9 billion)
2%
4%
Miscellaneous ($32. 6 billion)
1%
1%
39%
Customs dut ies ($21.1 bil ion)
Estate and gift taxes ($24.8 billion)
Social insurance taxes ($733.4 bil ion)
Revenue legislation is not considered automatically in the congressional budget
process on an annual basis. Frequently, however, the President proposes and
Congress considers changes in revenue laws to effect adjustments in the rates of
taxation or the distribution of the tax burden, or for other purposes. An initial step
in the congressional budget process is the publication of revenue estimates of the
President’s budget by CBO. These revenue estimates usually differ from the
President’s, since they are based on different economic and technical assumptions
(e.g., growth of the economy and change in the inflation rate). Cost estimates of any
congressional revenue proposals are prepared by CBO, based on revenue estimates
made by the Joint Committee on Taxation (JCT). They are published in committee
reports or in the Congressional Record and are available on JCT’s website.40
The budget resolution recommends yearly revenue levels, based on baseline
estimates of federal government revenues based on the continuation of existing laws
and any proposed policy changes to them. Revenue levels in the budget resolution
provide the framework for any action on revenue measures during the session. A
point of order may be raised against consideration of legislation that causes revenues
to fall below the agreed upon levels for the first fiscal year or the total for all fiscal
years in the budget resolution. This point of order may be set aside by unanimous
40 [http://www.house.gov/jct/].

CRS-20
consent, or waived by a special rule in the House or by a three-fifths vote in the
Senate (i.e., 60 Senators if there are no vacancies).
The conference report to the FY2006 budget resolution (H.Con.Res. 95, H.Rept.
109-62), agreed to by the House and Senate on April 28, allows for revenue
reductions of about $106 billion, of which $70 billion is included in reconciliation
directives, as mentioned above, for the period FY2005-FY2010, below the budget
baseline projected levels.41
A Senate “pay-as-you-go” (PAYGO) point of order, under Section 505 of the
FY2004 budget resolution (H.Con.Res. 95, 108th Congress), also may be raised
against any revenue legislation not assumed in the most recently adopted budget
resolution that would increase or cause an on-budget deficit for the first fiscal year,
the period of the first five fiscal years, or the following five fiscal years, covered by
the most recently adopted budget resolution.42 A motion to waive the point of order
requires a three-fifths vote.
During 2005, the Congress acted on several measures affecting revenues. The
revenue reconciliation measures considered by the House and Senate had the largest
projected impact on revenues, reducing revenues by $56.1 billion and $57.8 billion,
respectively, over the five-year period of FY2006-2010. (For information on the
consideration of these measures, see section “Revenue Reconciliation Legislation,”
above.)
In addition, the House and Senate considered several other measures affecting
revenues, such as those relating to transportation (H.R. 3), energy (H.R. 6), pensions
(H.R. 2830 and S. 1783), individual alternative minimum tax (AMT) relief (H.R.
4096), and hurricane relief (H.R. 3768, H.R. 4440, and S. 1969). Of these measures,
the Congress completed action on those related to transportation (P.L. 109-59,
August 10, 2005), energy (P.L. 109-58, August 8, 2005), and hurricane relief (P.L.
109-73, September 23, 2005, and P.L. 109-135, December 22, 2005). (The
transportation and energy bills also affected mandatory spending. For further
procedural information related to these bills, see section “Mandatory Spending,”
below.)
41 Total level of revenue reductions is based on Section 101(1)(B) of H.Con.Res. 95 (H.Rept.
109-62).
42 The chair of the Senate Budget Committee maintains a scorecard of the existing balance
of the deficit increase resulting from direct spending or revenue policy assumptions included
in the most recently adopted budget resolution. The joint explanatory statement of the
committee of conference on the FY2006 budget resolution indicates that the budget
resolution assumed deficit increases of $436 million for FY2005, $16.849 billion for
FY2006, $75.580 billion for the five-year period FY2006-FY2010, and $274.999 billion for
the next five-year period FY2011-FY2015. See U.S. Congress, Committee on Conference,
Concurrent Resolution on the Budget for Fiscal Year 2006, conference report to accompany
H.Con.Res. 95, 109th Cong., 1st sess., H.Rept. 109-62 (Washington: GPO, 2005), pp. 89-90.

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Debt-Limit Legislation. The amount of money the federal government is
allowed to borrow generally is subject to a statutory limit (31 U.S.C. 3101). From
time to time, Congress considers and adopts legislation to change this limit.43
Federal debt consists of debt held by the public plus debt held by government
accounts. The debt held by the public represents the total net amount borrowed from
the public to cover all or most of the federal government’s budget deficits. By
contrast, the debt held by government accounts represents the total net amount of
federal debt issued to specialized federal accounts, primarily trust funds (e.g., Social
Security). Trust fund surpluses by law must be invested in special (non-negotiable)
federal government securities, and thus are held in the form of federal debt. The
combination of both types of debt is subject to the statutory public debt limit.
Therefore, budget deficits or trust fund surpluses may contribute to the federal
government reaching the existing debt limit.
The annual congressional budget resolution specifies the appropriate level of the
public debt for each fiscal year covered by the resolution. Although the budget
resolution does not become law itself, the specified debt limits serve as a guide for
any necessary debt-limit legislation.
Congress may develop debt-limit legislation in any of three ways: (1) under
regular legislative procedures; (2) under House Rule XXVII; or (3) as part of
reconciliation legislation (as described above). Regardless of the process by which
debt-limit legislation is developed, the House Ways and Means Committee and the
Senate Finance Committee maintain exclusive jurisdiction over debt-limit legislation.
Under House Rule XXVII (commonly referred to as the Gephardt rule after its
author, former Representative Richard Gephardt), a joint resolution specifying the
amount of the debt limit contained in the budget resolution automatically is
engrossed and deemed to have passed the House by the same vote as the conference
report on the budget resolution, thereby avoiding a separate vote on the debt-limit
legislation.44 The Senate has no comparable automatic engrossment procedure; if it
chooses to consider a House-passed joint resolution, it does so under the regular
legislative process.
The most recent increase in the public-debt limit was enacted as an independent
measure (P.L. 108-415, 118 Stat. 2337) in November 2004. The debt-limit measure
increased the statutory limit by $800 billion, from $7.384 trillion to $8.184 trillion.
President Bush’s FY2006 budget projects that the debt subject to the statutory limit
will increase to $8.673 trillion, almost $500 billion over the current limit, by the end
43 For further information on debt-limit legislation, see CRS Report RS21519, Legislative
Procedures for Adjusting the Public Debt Limit: A Brief Overview, by Robert Keith and Bill
Heniff Jr.; and CRS Report RL31967, The Debt Limit: The Ongoing Need for Increases, by
Philip D. Winters.
44 For further information, see CRS Report RL31913, Developing Debt-Limit Legislation:
The House’s “Gephardt Rule,” by Bill Heniff Jr.

CRS-22
of FY2006.45 Therefore, Congress and the President will likely need to increase the
statutory limit in late 2005 or early 2006.46
Pursuant to House Rule XXVII, upon the adoption of the FY2006 budget
resolution by Congress, the House Clerk engrossed and transmitted to the Senate a
joint resolution (H.J.Res. 47) increasing the public debt limit by $781 billion, to
$8.965 trillion. H.J.Res. 47 was deemed to have been adopted by the House on April
28 by a vote of 214-211 (i.e., the vote upon which the House agreed to the conference
report to the FY2006 budget resolution).
The conference report to the FY2006 budget resolution (H.Con.Res. 95, H.Rept.
109-62) also contains a reconciliation directive to the House Ways and Means
Committee and the Senate Finance Committee to report, by September 30, legislation
increasing the statutory debt limit by $781 billion. As noted above, however, neither
the House or the Senate took action on a reconciliation measure changing the
statutory limit on the public debt in 2005.
Appropriations and Other Spending Legislation
Federal spending is categorized into two different types: discretionary or
mandatory spending. Discretionary spending is controlled through the annual
appropriations acts, while mandatory or direct spending (which consists mostly of
entitlement programs) is determined by existing substantive law.
Actual FY2004 federal outlays totaled $2,292 billion (see Figure 2).47 Of this
total amount, $895 billion, or 39%, was discretionary spending (exploded slices in
Figure 2), while $1,397 billion, or 61%, was mandatory spending.
45 OMB, Analytical Perspectives, Budget of the U.S. Government, Fiscal Year 2006, p. 247.
46 The Department of the Treasury, at the end of 2005, indicated that it would not be able
to finance government operations beyond mid-March 2006 without an increase in the
statutory limit on the public debt. See, for example, Jonathan Nicholson, “Snow Seeks
Boost in Debt Limit In Advance of Mid-February Deadline,” BNA’s Daily Report for
Executives (Jan. 3, 2006), p. A-17.
47 Chart created by CRS based on data from CBO, The Budget and Economic Outlook:
Fiscal Years 2006-2015 (Washington: CBO, 2005), pp. 138, 140, and 142. The chart
excludes offsetting receipts, which are treated as negative spending (i.e., they are deducted
from spending in the budget totals); offsetting receipts totaled $108.7 billion in FY2004.
Percentages do not add to 100% due to rounding.

CRS-23
Figure 2. Actual FY2004 Outlays
by Major Spending Category
As noted above, the total budget authority and outlays set forth in the budget
resolution are allocated among the House and Senate committees with jurisdiction
over specific spending legislation. These allocations, commonly referred to as 302(a)
allocations after the applicable section of the Congressional Budget Act, are specified
in the joint explanatory statement accompanying the conference report to the budget
resolution.48 A point of order may be raised against any legislation that would cause
a committee’s spending allocation to be exceeded. Like most points of order under
the Congressional Budget Act, this point of order may be set aside by unanimous
consent, or waived by a special rule in the House or by a three-fifths vote in the
Senate (i.e., 60 Senators if there are no vacancies). The budget resolution typically
provides for periodic revisions of these allocations if certain conditions, specified in
reserve fund provisions, for instance, are met.
Discretionary Spending. Discretionary spending is under the jurisdiction
of the House and Senate Appropriations Committees. Soon after the budget
resolution is adopted by Congress, the House and Senate Appropriations Committees
subdivide their spending allocations among their subcommittees and formally report
these suballocations to their respective chambers. These suballocations, referred to
48 See U.S. Congress, Committee on Conference, Concurrent Resolution on the Budget for
Fiscal Year 2006, conference report to accompany H.Con.Res. 95, 109th Cong., 1st sess.,
H.Rept. 109-62 (Washington: GPO, 2005), pp. 85-89.

CRS-24
as 302(b) allocations after the applicable section of the Congressional Budget Act,
effectively represent the spending ceilings on the individual regular appropriations
acts. A point of order may be raised against the consideration of an appropriations
measure, or any amendment, if it would cause the applicable appropriations
subcommittee 302(b) allocations to be exceeded. This point of order, like others
under the Congressional Budget Act, may be set aside by unanimous consent, or
waived by a special rule in the House or by a three-fifths vote in the Senate (i.e., 60
Senators if there are no vacancies). During the appropriations process, these
suballocations usually are revised several times.
Congress passes three main types of appropriations measures. Regular
appropriations acts provide budget authority for the next fiscal year, beginning on
October 1.49 (From time to time, Congress merges two or more of these regular
appropriations acts into an omnibus appropriations act at the end of the year.)
Supplemental appropriations acts provide additional funding for unexpected needs
while the fiscal year is in progress. Continuing appropriations acts, commonly
referred to as continuing resolutions, provide stop-gap funding for agencies that have
not received regular appropriations by the start of the fiscal year.
The President’s budget includes recommendations for the agencies, programs,
and activities funded in the annual appropriations measures; account and program
level detail about these recommendations is included in the Appendix volume of the
President’s budget documents. In addition, agencies submit justification materials
to the House and Senate Appropriations Committees. The budget justifications
provide more detailed information about an agency’s program activities than is
contained in the President’s budget documents and are used in support of agency
testimony during appropriations subcommittee hearings on the President’s budget
request.
The House and Senate appropriations subcommittees begin holding extensive
hearings on appropriations requests shortly after the President’s budget is submitted.
By custom, appropriations measures originate in the House. In recent years, the
Senate Appropriations Committee has adopted and reported original Senate
appropriations measures, allowing the Senate to consider appropriations measures
without having to wait for the House to adopt its version. Under this practice, the
Senate version is considered and amended on the floor, and then inserted into the
House-adopted version, when available, as a substitute amendment, thereby retaining
the House-numbered bill for final action.
49 Each subcommittee of the House and Senate Appropriations Committees typically is
responsible for one of the regular appropriations acts. On Feb. 15, the House
Appropriations Committee voted to reduce the number of its subcommittees from 13 to 10
and adjust their jurisdiction. Each subcommittee continues to be responsible for one regular
appropriations act, and the full Committee is responsible for the accounts and programs of
the Legislative Branch. On Mar. 2, Senator Thad Cochran, chairman of the Senate
Appropriations Committee, announced a new subcommittee organization, including the
elimination of one subcommittee, leaving 12 subcommittees. For additional information on
changes to the appropriations subcommittee structure, see CRS Report RL31572,
Appropriations Subcommittee Structure: History of Changes from 1920-2005, by James V.
Saturno.

CRS-25
Congress also often adopts one or more continuing resolutions each year
because of recurring delays in the appropriations process. For example, Congress
passed three continuing resolutions before completing action on the FY2005 regular
appropriations acts.50
Appropriations for FY2006. The conference report to the FY2006 budget
resolution (H.Con.Res. 95, H.Rept. 109-62) provided for about $843 billion in
discretionary spending. Accordingly, the House Appropriations Committee received
a spending allocation [its so-called 302(a) allocation] of $843,020 million in budget
authority and $916,836 million in outlays, and the Senate Appropriations Committee
received a spending allocation [its so-called 302(a) allocation] of $842,265 million
in budget authority and $916,081 million in outlays, for the FY2006 regular
appropriations measures.51 Subsequently, these spending allocations were adjusted
to levels effectively consistent to those allocated to the House Appropriations
Committee.52 The allocations to the House and Senate Appropriations Committees
were consistent with the total FY2006 discretionary spending amount supported by
the Administration.53
On May 12, 2005, the House Appropriations Committee reported its initial
subcommittee spending allocations (H.Rept. 109-78) and revised these subdivisions
three times (H.Rept. 109-85, H.Rept. 109-145, and H.Rept. 109-264). On June 9, the
Senate Appropriations Committee reported its initial subcommittee spending
allocations (S.Rept. 109-77) and revised these subdivisions five times (S.Rept. 109-
95, S.Rept. 109-115, S.Rept. 109-176, S.Rept. 109-184, and S.Rept. 109-207). As
mentioned above, these subdivisions [or so-called 302(b) allocations] serve as
spending ceilings for the individual regular appropriations measures and are enforced
by points of order on the floor of each chamber.
50 Initially, Congress passed, and President Bush signed into law, a continuing resolution
(H.J.Res. 107, P.L. 108-309) to provide temporary appropriations through November 20,
2004, for agencies and programs funded in the regular appropriations acts not enacted by
the start of the fiscal year. Subsequently, Congress and President Bush extended the
temporary funding through Dec. 3 (H.J.Res. 114, P.L. 108-416) and Dec. 8 (H.J.Res. 115,
P.L. 108-434).
51 Section 404(b) provides for the upward adjustment of the Senate Appropriations
Committee’s allocations by $755 million (in budget authority and outlays) for FY2006 if it
reports appropriations bills that meet certain criteria involving continuing disability reviews,
Internal Revenue Service tax enforcement, health care fraud and abuse control program, and
unemployment insurance improper payments. This $755 million accounts for the difference
between the appropriations committees allocations.
52 The initial spending allocations to the Senate Appropriations Committee were revised to
$843,020 million in budget authority and $916,836 million in outlays on July 28, 2005, by
Senate Budget Committee Chairman Judd Gregg, under the authority of Section 404(b) of
H.Con.Res. 95. See Congressional Record, daily edition, vol. 151 (July 28, 2005), pp.
S9274-S9275.
53 See, for example, the Statements of Administration Policy for any of the FY2006 regular
appropriations acts, available at [http://www.whitehouse.gov/omb/legislative/sap/109-1/
index-apps.html].

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The conference report to the FY2006 budget resolution also contains
discretionary spending limits for each fiscal year covering FY2006 through FY2008
(Section 404 of H.Con.Res. 95), which may be enforced in the Senate by a point of
order.54 A motion to waive the point of order requires a three-fifths vote (i.e., 60
Senators if there are no vacancies).
The House and Senate began consideration of the regular appropriations bills
for FY2006 during the weeks of May 16 and June 20, respectively.55 When FY2006
began on October 1, the House had passed 11, and the Senate had passed eight, of the
regular appropriations acts for FY2006. Only two of these had been signed into law.
Consequently, Congress passed and President Bush signed into law a continuing
resolution (H.J.Res. 68, P.L. 109-77) to provide temporary appropriations through
November 18, 2005, for agencies and programs funded in the remaining regular
appropriations acts not yet enacted. Subsequently, Congress and President Bush
extended the temporary funding through December 17 (H.J.Res. 72, P.L. 109-105)
and through December 31 (H.J.Res. 75, P.L. 109-128).
The Congress completed action on the regular appropriations acts for FY2006
when the Senate, on December 21, agreed to the conference reports to the Defense
Appropriations Act (H.R. 2863, H.Rept. 109-359) and the Labor, Health and Human
Services, and Education Appropriations Act (H.R. 3010, H.Rept. 109-337).56 On
December 30, President Bush signed H.R. 2863 and H.R. 3010 into law (P.L. 109-
148 and P.L. 109-149, respectively), thereby bringing action on the FY2006 regular
appropriations acts to a close.
54 Section 404 of H.Con.Res. 95 also provides for the adjustment of the FY2006
discretionary spending limits to accommodate spending for continuing disability reviews,
Internal Revenue Service tax enforcement, health care fraud and abuse control program, and
unemployment insurance improper payments. Like the spending allocations to the Senate
Appropriations Committee, these discretionary spending limits for FY2006 were adjusted
on July 28, 2005. See Congressional Record, daily edition, vol. 151 (July 28, 2005), pp.
S9274-S9275.
55 For the up-to-date status of and further information on the FY2006 appropriations bills,
see [http://www.crs.gov/products/appropriations/apppage.shtml], the CRS Appropriations
website.
56 On December 21, the Senate rejected a motion to invoke cloture on the conference report
to the Defense Appropriations Act (H.R. 2863) by a 56-44 vote. Subsequently but prior to
agreeing to the conference report to H.R. 2863, the Senate agreed to a concurrent resolution
(S.Con.Res. 74) correcting the enrollment of H.R. 2863. S.Con.Res. 74 directed the Clerk
of the House to strike Division C (relating to the Arctic National Wildlife Refuge (ANWR))
and Division D (relating to the distribution of ANWR proceeds and disaster assistance) in
the enrollment of H.R. 2863. The Senate then agreed to the conference report to H.R. 2863
by a 93-0 vote. The Senate also agreed by unanimous consent that if the House did not
agree to S.Con.Res. 74, the passage by the Senate of the Defense Appropriations Act be
vitiated. See Congressional Record, daily edition, vol. 151 (Dec. 21, 2005), pp. S14233-
S14254. The House, subsequently, adopted S.Con.Res. 74 by unanimous consent on
December 22. See Congressional Record, daily edition, vol. 151 (Dec. 22, 2005), pp.
H13181-H13183.

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Although Congress did not complete action on most of the regular
appropriations acts prior to the start of the fiscal year, it did pass the regular
appropriations acts as freestanding measures instead of incorporating two or more of
them into an omnibus measure as it did in the past three years.57
In addition, as in the past three years, Congress included an across-the-board
spending cut to adhere to the discretionary spending levels assumed in the FY2006
budget resolution and to offset emergency spending related to previously-enacted
hurricane assistance. Section 3801 of the Defense Appropriations Act, 2006,
provides for a 1% spending cut that applies to all programs, projects, and activities
contained in the regular appropriations acts for FY2006 (except FY2006
discretionary appropriations designated as an emergency requirement or made
available to the Department of Veterans Affairs).58 According to the House
Appropriations Committee, the 1% across-the-board spending cut will result in
savings of $8.5 billion.59
Supplemental Appropriations. In addition to the regular appropriations
acts, Congress typically acts on at least one supplemental appropriations measure
during a session. On February 14, President Bush submitted a request for FY2005
supplemental appropriations for ongoing activities in Iraq and Afghanistan as well
as for Indian Ocean tsunami relief and recovery efforts, among other things.60 In
response to the President’s request, the House Appropriations Committee reported
H.R. 1268, Emergency Supplemental Appropriations Act for Defense, the Global
War on Terror, and Tsunami Relief, 2005 (H.Rept. 109-16) on March 11. The House
considered H.R. 1268 on March 15 and 16, and adopted the measure by a vote of
388-43. The Senate Appropriations Committee, subsequently, ordered reported H.R.
1268 with an amendment in the nature of a substitute (S.Rept. 109-52) on April 6.
The Senate considered the FY2005 supplemental appropriations act on nine days
between April 11 and April 21, adopting the measure, as amended, on April 21 by
a 99-0 vote.
On May 3, a conference report to accompany H.R. 1268 was filed. According
to the Appropriations Committees, H.R. 1268 would provide about $82 billion in
new budget authority for FY2005. The House agreed to the conference report on
57 For further information on this practice, see CRS Report RL32473, Omnibus
Appropriations Acts: Overview of Recent Practices, by Robert Keith.
58 For further information on this practice, see CRS Report RL32153, Across-the-Board
Spending Cuts in Omnibus Appropriations Acts, by Robert Keith.
59 [http://appropriations.house.gov/index.cfm?FuseAction=PressReleases.Detail&PressR
elease_id=532].
60 For further information on the supplemental appropriations request, see CRS Report
RL32783, FY2005 Supplemental Appropriations for Iraq and Afghanistan, Tsunami Relief,
and Other Activities, by Amy Belasco and Larry Nowels. On Mar. 2, President Bush
transmitted additional supplemental proposals for FY2005 requested by the legislative and
judicial branches. Such requests of the other branches typically are transmitted to Congress
by the President, without modification, “as a matter of comity.” For the President’s
supplemental requests, see [http://www.whitehouse.gov/omb/budget/amendments.htm].

CRS-28
May 5 by a 368-58 vote. The Senate agreed to the conference report on May 10 by
a 100-0 vote. President Bush signed the measure into law (P.L. 109-13) on May 11.
The supplemental appropriations were designated as emergency requirements,
pursuant to Section 402 of S.Con.Res. 95 (108th Congress), the FY2005 budget
resolution, as made applicable to the House by H.Res. 5 (109th Congress) and to the
Senate by Section 14007 of P.L. 108-287, and thereby exempt from the spending
constraints mentioned above.
In addition, President Bush submitted two additional requests for supplemental
appropriations for hurricane-related disaster assistance.61 First, on September 2,
2005, the House and Senate passed H.R. 3645, Emergency Supplemental
Appropriations Act to Meet Immediate Needs Arising From the Consequences of
Hurricane Katrina, 2005, by voice vote and unanimous consent, respectively, and
President Bush signed it into law (P.L. 109-61). P.L. 109-61 provides $10.5 billion
in supplemental appropriations. Second, on September 8, the House and Senate
passed H.R. 3673, Second Emergency Supplemental Appropriations Act to Meet
Immediate Needs Arising From the Consequences of Hurricane Katrina, 2005, by
votes of 410-11 and 97-0, respectively, and President Bush signed it into law (P.L.
109-62). P.L. 109-62 provides $51.8 billion in supplemental appropriations.
Like the supplemental appropriations enacted earlier in the year, the
supplemental appropriations were designated as emergency requirements pursuant
to section 402 of H.Con.Res. 95, the FY2006 budget resolution, thereby exempting
the appropriations from the spending constraints associated with the budget
resolution, as mentioned above.
On October 28, 2005, President Bush submitted to Congress a request to
reallocate $17.1 billion of the $51.8 billion in supplemental appropriations provided
in P.L. 109-62.62 In response to this request, the Congress included a reallocation of
hurricane-related funds in the Defense Appropriations Act, 2006 (H.R. 2863, P.L.
109-359). Division B (the Emergency Supplemental Appropriations Act to Address
Hurricanes in the Gulf of Mexico and Pandemic Influenza, 2006) of H.R. 2863,
however, reallocated $23.4 billion of the previously-enacted supplemental
appropriations instead of the $17.1 billion requested by the President.
Rescission Request. In addition to the request to reallocate previously-
enacted supplemental appropriations, on October 28, President Bush also submitted
to Congress a request to rescind $2.3 billion in previously-enacted appropriations to
help defray the costs associated with disaster relief efforts. Like the reallocation of
funds, the Congress included several rescissions in the Defense Appropriations Act,
2006 (H.R. 2863, P.L. 109-359). Division B (the Emergency Supplemental
Appropriations Act to Address Hurricanes in the Gulf of Mexico and Pandemic
61 For further information, see CRS Report RS22239, Emergency Supplemental
Appropriations for Hurricane Katrina Relief, by Jennifer E. Lake and Ralph M. Chite.
62 The request and the subsequent legislation rescinded the previously-enacted $17.1 billion
to the Federal Emergency Management Agency and appropriated $17.1 billion to various
agencies for purposes of disaster relief, effectively reallocating the funds.

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Influenza, 2006) of H.R. 2863, however, rescinded only $1 billion of previously-
enacted appropriations instead of the $2.3 billion requested by the President. (As
noted above, however, the 1% across-the-board spending cut included in H.R. 2863
is projected to result in savings of $8.5 billion.)
Mandatory Spending. Mandatory spending is under the jurisdiction of the
various legislative committees of the House and Senate. Some entitlement programs,
such as Medicaid and certain veterans’ programs, are funded in annual appropriations
acts, but such spending is not considered discretionary and is not controlled through
the annual appropriations process.
In addition to the committee spending allocations, under the Section 302 process
mentioned above, mandatory spending legislation is limited by the Senate’s PAYGO
requirement. As with revenue legislation mentioned above, a point of order, under
Section 505 of the FY2004 budget resolution (H.Con.Res. 95, 108th Congress), may
be raised against any mandatory spending legislation not assumed in the most
recently adopted budget resolution that would increase or cause an on-budget deficit
for the first fiscal year, the period of the first five fiscal years, or the following five
fiscal years, covered by the most recently adopted budget resolution.63 A motion to
waive the point of order requires a three-fifths vote (i.e., 60 Senators if there are no
vacancies).
On several occasions in the past, Congress has included reserve funds in the
budget resolution to accommodate specific mandatory spending legislation, often
requiring that the legislation be deficit neutral. Under the provisions of a reserve
fund, the chairmen of the House and Senate Budget Committees may revise the
committee spending allocations and other budget resolution levels if certain
legislation is reported by the appropriate committee. Without such an adjustment,
mandatory spending legislation might be subject to points of order if it were not
assumed in the budget resolution spending amounts.
The Senate-passed version of the FY2006 budget resolution (S.Con.Res. 18)
contains 16 reserve funds (Sections 301-316) for such purposes as health information
technology and pay-for-performance legislation and extension of treatment of combat
pay for earned income and child tax credits legislation. The House-passed version
(H.Con.Res. 95) contains one reserve fund, or “contingency procedure” (Section
301), for surface transportation legislation. As indicated in Table 4, the conference
report to the FY2006 budget resolution (H.Con.Res. 95, H.Rept. 109-62) contains 10
reserve funds (Sections 301-310) for such purposes of surface transportation
legislation and the restoration of unexpended funds under the State Children’s Health
63 The chair of the Senate Budget Committee maintains a scorecard of the existing balance
of the deficit increase resulting from direct spending or revenue policy assumptions included
in the most recently adopted budget resolution. The joint explanatory statement of the
committee of conference on the FY2006 budget resolution indicates that the budget
resolution assumed deficit increases of $436 million for FY2005, $16.849 billion for
FY2006, $75.580 billion for the five-year period FY2006-FY2010, and $274.999 billion for
the next five-year period FY2011-FY2015. See U.S. Congress, Committee on Conference,
Concurrent Resolution on the Budget for Fiscal Year 2006, conference report to accompany
H.Con.Res. 95, 109th Cong., 1st sess., H.Rept. 109-62 (Washington: GPO, 2005), pp. 89-90.

CRS-30
Insurance Program. Four of these reserve funds apply to both the House and Senate;
one applies to the House only; and five apply to the Senate only.
During 2005, in addition to the spending reconciliation measure (see section
“Spending Reconciliation Legislation,” above), Congress acted on two major
measures affecting mandatory spending relating to transportation (H.R. 3)64 and
energy (H.R. 6)65 policy. In both cases, the Senate waived points of order under the
Budget Act during their consideration.
First, on March 10, the House passed its version of the highway and transit
program reauthorization legislation (H.R. 3). In the Senate, during consideration of
the legislation, the Senate agreed to waive a point of order (under Section 302(f) of
the Budget Act) against Senator James Inhofe’s amendment in the nature of a
substitute (S.Amdt. 605) by a vote of 76-22; the point of order was raised because the
amendment, if adopted, would have caused the legislation to exceed the spending
amounts for transportation programs provided in the FY2006 budget resolution
(H.Con.Res. 95).66 The Senate, subsequently, agreed to the amendment and passed
the bill, as amended, on May 17. After resolving the legislative differences between
the two versions in a conference committee, the House and Senate agreed to the
conference report to H.R. 3 on July 29. President Bush signed the legislation into
law (P.L. 109-59) on August 10.67
Second, on April 21, the House passed its version of the energy legislation (H.R.
6). In the Senate, during consideration of the legislation, the Senate agreed to waive
a point of order (under Section 302(f) of the Budget Act) against Senator Pete
Domenici’s amendment to modify the section relating to the coastal impact assistance
program (S.Amdt. 891) by a vote of 69-26; the point of order was raised because the
amendment, if adopted, would have caused the legislation to exceed the spending
amounts under the jurisdiction of the Senate Energy and Natural Resources
Committee provided in the FY2006 budget resolution (H.Con.Res. 95).68 The
64 For further information on the legislation, see CRS Report RL33119, Safe, Accountable,
Flexible, Efficient Transportation Equity Act — A Legacy for Users (SAFETEA-LU or
SAFETEA): Selected Major Provisions, by John W. Fischer.
65 Background information is available in archived CRS Issue Brief IB10143, Energy Policy:
Comprehensive Energy Legislation (H.R. 6) in the 109th Congress, by Robert L. Bamberger
and Carl E. Behrens. (The archived issue brief is available from the author.)
66 The contract authority provided in the legislation for transportation programs is treated
as mandatory spending, while the resulting outlays are treated as discretionary spending.
Therefore, the contract authority amounts are subject to the 302(a) spending limits allocated
to the committees of jurisdiction by the FY2006 budget resolution. For the discussion on
the Senate floor related to the point of order and the motion to waive it, see Congressional
Record, daily edition, vol. 151 (May 11, 2005), pp. S4896-S4903.
67 For a cost estimate, see [http://www.cbo.gov/ftpdocs/66xx/doc6654/hr3paygo.pdf].
68 According to Senator Gregg, who raised the point of order, the amendment would have
converted a discretionary program into an entitlement (i.e., mandatory spending) program,
resulting in an increase in mandatory spending. For the discussion on the Senate floor
related to the point of order and the motion to waive it, see Congressional Record, daily
(continued...)

CRS-31
Senate, subsequently, agreed to the amendment on June 23 and passed the bill, as
amended, on June 28. After resolving the legislative differences between the two
versions in a conference committee, the House and Senate agreed to the conference
report to H.R. 6 on July 28 and 29, respectively. In the Senate, during the
consideration of the conference report, the Senate agreed to waive a point of order
(under Section 302(f) of the Budget Act) against the conference report by a vote of
71-29.69 President Bush, subsequently, signed the legislation into law (P.L. 109-58)
on August 8.70
68 (...continued)
edition, vol. 151 (June 23, 2005), pp. S7210-S7233.
69 According to Senator Russ Feingold, who raised the point of order, the conference report
exceeded the amount allocated by the FY2006 budget resolution (H.Con.Res. 95).
For the discussion on the Senate floor related to the point of order and the motion to waive
it, see Congressional Record, daily edition, vol. 151 (July 29, 2005), p. S9374.
70 For a cost estimate, see [http://www.cbo.gov/ftpdocs/65xx/doc6581/hr6prelim.pdf].

CRS-32
Chronology
December 21, 2005
The Senate agreed by a 51-50 vote (with Vice President
Cheney voting in the affirmative to break the tie) to a
motion to concur in the House amendment to S. 1932
with a further amendment containing the text of the
conference report with certain provisions stricken,
sending the measure back to the House for further action.
December 19
The House agreed to the conference report to the
(legislative day,
spending reconciliation measure (S. 1932, H.Rept. 109-
December 18), 2005
362) by a 212-206 vote.
December 8, 2005
The House passed its revenue reconciliation measure
(H.R. 4297) by a 217-215 vote.
November 18
The Senate passed its revenue reconciliation measure (S.
(legislative day,
2020) by a 52-47 vote.
November 17), 2005
November
17,
2005
The House passed its version of
the
spending
reconciliation measure (H.R. 4241) by a vote of 217-215.
November 3, 2005
The Senate passed its spending reconciliation measure (S.
1932) by a 52-47 vote.
April 28, 2005
The House and Senate agreed to the conference report to
the FY2006 budget resolution (H.Con.Res. 95, H.Rept.
109-62) by votes of 214-211 and 52-47, respectively.
March 17, 2005
The House agreed to its version of the FY2006 budget
resolution (H.Con.Res. 95) by a vote of 218-214; the
Senate agreed to its version (S.Con.Res. 18) by a vote of
51-49.
February 7, 2005
President Bush submitted his FY2006 budget to
Congress.
January 25, 2005
CBO released its annual report on budget baseline
projections, The Budget and Economic Outlook: Fiscal
Years 2006-2015.

CRS-33
For Additional Reading
Congressional Hearings, Reports, and Documents
Congressional Budget Office. An Analysis of the President’s Budgetary Proposals
for Fiscal Year 2006. Washington: CBO, March 2005.
Congressional Budget Office. The Budget and Economic Outlook: Fiscal Years
2006-2015. Washington: CBO, January 2005.
Congressional Budget Office. Budget Options. Washington: CBO, February 2005.
U.S. Congress. House Committee on the Budget. Concurrent Resolution on the
Budget — Fiscal Year 2006. Report to Accompany H.Con.Res. 95. 109th
Congress, 1st session. H.Rept. 109-17. Washington: GPO, 2005.
U.S. Congress. House Committee on the Budget. Deficit Reduction Act of 2005.
Report to Accompany H.R. 4241. 109th Congress, 1st session. H.Rept. 109-276.
Washington: GPO, 2005.
U.S. Congress. Senate Committee on the Budget. Concurrent Resolution on the
Budget FY2006. Committee Print to Accompany S.Con.Res. 18. 109th
Congress, 1st session. S.Prt. 109-18. Washington: GPO, 2005.
U.S. Congress. Senate Committee on the Budget. Deficit Reduction Omnibus
Reconciliation Act of 2005. Committee Recommendations as Submitted to the
Committee on the Budget Pursuant to H.Con.Res. 95. 109th Congress, 1st
session. S.Prt. 109-37. Washington: GPO, 2005.
U.S. Congress. Committee on Conference. Concurrent Resolution on the Budget for
Fiscal Year 2006. Conference Report to Accompany H.Con.Res. 95. 109th
Congress, 1st session. H.Rept. 109-62. Washington: GPO, 2005.
U.S. Congress. Committee on Conference. Deficit Reduction Act of 2005.
Conference Report to Accompany H.Con.Res. 95. 109th Congress, 1st session.
H.Rept. 109-362. Washington: GPO, 2005.
CRS Products
CRS Report RL32246. Congressional Budget Actions in 2004, by Bill Heniff Jr.
CRS Report RL30297. Congressional Budget Resolutions: Selected Statistics and
Information Guide, by Bill Heniff Jr.
CRS Report RL33132. Budget Reconciliation Legislation in 2005, by Robert Keith.
CRS Report RL33127. Speaker Hastert’s Plan to Offset Spending: A Procedural
Perspective, by Robert Keith.

CRS-34
CRS Report RL33122. Congressional Budget Resolutions: Revisions and
Adjustments, by Robert Keith.
CRS Report RL33030. The Budget Reconciliation Process: House and Senate
Procedures, by Robert Keith and Bill Heniff Jr.
CRS Report 98-721. Introduction to the Federal Budget Process, by Robert Keith
and Allen Schick.
CRS Report 97-684. The Congressional Appropriations Process: An Introduction,
by Sandy Streeter.
CRS Report RL30343. Continuing Appropriations Acts: Brief Overview of Recent
Practices, by Sandy Streeter.
CRS Report RL32264. The Budget for Fiscal Year 2005, by Philip D. Winters.
CRS Report RL32812. The Budget for Fiscal Year 2006, by Philip D. Winters.