§ 903. — Enforcing deficit targets.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 2USC903]
TITLE 2--THE CONGRESS
CHAPTER 20--EMERGENCY POWERS TO ELIMINATE BUDGET DEFICITS
SUBCHAPTER I--ELIMINATION OF DEFICITS IN EXCESS OF MAXIMUM DEFICIT
AMOUNT
Sec. 903. Enforcing deficit targets
(a) Sequestration
Within 15 calendar days after Congress adjourns to end a session
(other than of the One Hundred First Congress) and on the same day as a
sequestration (if any) under section 901 of this title and section 902
of this title, but after any sequestration required by section 901 of
this title (enforcing discretionary spending limits) or section 902 of
this title (enforcing pay-as-you-go), there shall be a sequestration to
eliminate the excess deficit (if any remains) if it exceeds the margin.
(b) Excess deficit; margin
The excess deficit is, if greater than zero, the estimated deficit
for the budget year, minus--
(1) the maximum deficit amount for that year;
(2) the amounts for that year designated as emergency direct
spending or receipts legislation under section 902(e) of this title;
and
(3) for any fiscal year in which there is not a full adjustment
for technical and economic reestimates, the deposit insurance
reestimate for that year, if any, calculated under subsection (h) of
this section.
The ``margin'' for fiscal year 1992 or 1993 is zero and for fiscal year
1994 or 1995 is $15,000,000,000.
(c) Dividing sequestration
To eliminate the excess deficit in a budget year, half of the
required outlay reductions shall be obtained from non-exempt defense
accounts (accounts designated as function 050 in the President's fiscal
year 1991 budget submission) and half from non-exempt, non-defense
accounts (all other non-exempt accounts).
(d) Defense
Each non-exempt defense account shall be reduced by a dollar amount
calculated by multiplying the level of sequestrable budgetary resources
in that account at that time by the uniform percentage necessary to
carry out subsection (c) of this section, except that, if any military
personnel are exempt, adjustments shall be made under the procedure set
forth in section 901(a)(3) of this title.
(e) Non-defense
Actions to reduce non-defense accounts shall be taken in the
following order:
(1) First
All reductions in automatic spending increases under section
906(a) of this title shall be made.
(2) Second
If additional reductions in non-defense accounts are required to
be made, the maximum reduction permissible under sections 906(b) of
this title (guaranteed student loans) and 906(c) of this title
(foster care and adoption assistance) shall be made.
(3) Third
(A) If additional reductions in non-defense accounts are
required to be made, each remaining non-exempt, non-defense account
shall be reduced by the uniform percentage necessary to make the
reductions in non-defense outlays required by subsection (c) of this
section, except that--
(i) the medicare program specified in section 906(d) of this
title shall not be reduced by more than 2 percent in total
including any reduction of less than 2 percent made under
section 902 of this title or, if it has been reduced by 2
percent or more under section 902 of this title, it may not be
further reduced under this section; and
(ii) the health programs set forth in section 906(e) of this
title shall not be reduced by more than 2 percent in total
(including any reduction made under section 901 of this title),
and the uniform percent applicable to all other programs under this
subsection shall be increased (if necessary) to a level sufficient
to achieve the required reduction in non-defense outlays.
(B) For purposes of determining reductions under subparagraph
(A), outlay reduction (as a result of sequestration of Commodity
Credit Corporation commodity price support contracts in the fiscal
year of a sequestration) that would occur in the following fiscal
year shall be credited as outlay reductions in the fiscal year of
the sequestration.
(f) Baseline assumptions; part-year appropriations
(1) Budget assumptions
For purposes of subsections (b), (c), (d), and (e) of this
section, accounts shall be assumed to be at the level in the
baseline minus any reductions required to be made under sections 901
and 902 of this title.
(2) Part-year appropriations
If, on the date specified in subsection (a) of this section,
there is in effect an Act making or continuing appropriations for
part of a fiscal year for any non-exempt budget account, then the
dollar sequestration calculated for that account under subsection
(d) or (e) of this section, as applicable, shall be subtracted
from--
(A) the annualized amount otherwise available by law in that
account under that or a subsequent part-year appropriation; and
(B) when a full-year appropriation for that account is
enacted, from the amount otherwise provided by the full-year
appropriation; except that the amount to be sequestered from
that account shall be reduced (but not below zero) by the
savings achieved by that appropriation when the enacted amount
is less than the baseline for that account.
(g) Adjustments to maximum deficit amounts
(1) Adjustments
(A) When the President submits the budget for fiscal year
1992, the maximum deficit amounts for fiscal years 1992, 1993,
1994, and 1995 shall be adjusted to reflect up-to-date
reestimates of economic and technical assumptions and any
changes in concepts or definitions. When the President submits
the budget for fiscal year 1993, the maximum deficit amounts for
fiscal years 1993, 1994, and 1995 shall be further adjusted to
reflect up-to-date reestimates of economic and technical
assumptions and any changes in concepts or definitions.
(B) When submitting the budget for fiscal year 1994, the
President may choose to adjust the maximum deficit amounts for
fiscal years 1994 and 1995 to reflect up-to-date reestimates of
economic and technical assumptions. If the President chooses to
adjust the maximum deficit amount when submitting the fiscal
year 1994 budget, the President may choose to invoke the same
adjustment procedure when submitting the budget for fiscal year
1995. In each case, the President must choose between making no
adjustment or the full adjustment described in paragraph (2). If
the President chooses to make that full adjustment, then those
procedures for adjusting discretionary spending limits described
in sections 901(b)(1)(C) \1\ and 901(b)(2)(E) \1\ of this title,
otherwise applicable through fiscal year 1993 or 1994 (as the
case may be), shall be deemed to apply for fiscal year 1994 (and
1995 if applicable).
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\1\ See References in Text note below.
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(C) When the budget for fiscal year 1994 or 1995 is
submitted and the sequestration reports for those years under
section 904 of this title are made (as applicable), if the
President does not choose to make the adjustments set forth in
subparagraph (B), the maximum deficit amount for that fiscal
year shall be adjusted by the amount of the adjustment to
discretionary spending limits first applicable for that year (if
any) under section 901(b) of this title.
(D) For each fiscal year the adjustments required to be made
with the submission of the President's budget for that year
shall also be made when OMB submits the sequestration update
report and the final sequestration report for that year, but OMB
shall continue to use the economic and technical assumptions in
the President's budget for that year.
Each adjustment shall be made by increasing or decreasing the
maximum deficit amounts set forth in section 665 \1\ of this title.
(2) Calculations of adjustments
The required increase or decrease shall be calculated as
follows:
(A) The baseline deficit or surplus shall be calculated
using up-to-date economic and technical assumptions, using up-
to-date concepts and definitions, and, in lieu of the baseline
levels of discretionary appropriations, using the discretionary
spending limits set forth in section 665 \1\ of this title as
adjusted under section 901 of this title.
(B) The net deficit increase or decrease caused by all
direct spending and receipts legislation enacted after November
5, 1990 (after adjusting for any sequestration of direct
spending accounts) shall be calculated for each fiscal year by
adding--
(i) the estimates of direct spending and receipts
legislation transmitted under section 902(d) of this title
applicable to each such fiscal year; and
(ii) the estimated amount of savings in direct spending
programs applicable to each such fiscal year resulting from
the prior year's sequestration under this section or section
902 of this title of direct spending, if any, as contained
in OMB's final sequestration report for that year.
(C) The amount calculated under subparagraph (B) shall be
subtracted from the amount calculated under subparagraph (A).
(D) The maximum deficit amount set forth in section 665 \1\
of this title shall be subtracted from the amount calculated
under subparagraph (C).
(E) The amount calculated under subparagraph (D) shall be
the amount of the adjustment required by paragraph (1).
(h) Treatment of deposit insurance
(1) Initial estimates
The initial estimates of the net costs of federal deposit
insurance for fiscal year 1994 and fiscal year 1995 (assuming full
funding of, and continuation of, the deposit insurance guarantee
commitment in effect on the date of the submission of the budget for
fiscal year 1993) shall be set forth in that budget.
(2) Reestimates
For fiscal year 1994 and fiscal year 1995, the amount of the
reestimate of deposit insurance costs shall be calculated by
subtracting the amount set forth under paragraph (1) for that year
from the current estimate of deposit insurance costs (but assuming
full funding of, and continuation of, the deposit insurance
guarantee commitment in effect on the date of submission of the
budget for fiscal year 1993).
(Pub. L. 99-177, title II, Sec. 253, Dec. 12, 1985, 99 Stat. 1078; Pub.
L. 100-119, title I, Sec. 103, Sept. 29, 1987, 101 Stat. 775; Pub. L.
101-508, title XIII, Sec. 13101(a), Nov. 5, 1990, 104 Stat. 1388-583.)
Termination of Section
For termination of section by section 275(b) of Pub. L. 99-177,
as amended, see Effective and Termination Dates note set out under
section 900 of this title.
References in Text
Section 901 of this title, referred to in subsec. (g)(1)(B), was
amended by Pub. L. 105-33, title X, Sec. 10203(a)(4), Aug. 5, 1997, 111
Stat. 699, by striking out subsec. (b) and adding a new subsec. (b). In
the new subsec. (b), par. (1) does not contain a subpar. (C) and par.
(2)(E) relates to allowance for international arrearages. Prior to
amendment, section 901(b)(2)(E) related to special allowance for
discretionary new budget authority.
Section 665 of this title, referred to in subsec. (g)(1), (2)(A),
(D), was repealed by Pub. L. 105-33, title X, Sec. 10118(a), Aug. 5,
1997, 111 Stat. 695.
Codification
November 5, 1990, referred to in subsec. (g)(2)(B), was in the
original ``the date of enactment of this section'', which was translated
as meaning the date of enactment of Pub. L. 101-508, which amended this
section generally, to reflect the probable intent of Congress.
Amendments
1990--Pub. L. 101-508 amended section generally, substituting
provisions relating to enforcement of deficit targets for provisions
relating to compliance report by Comptroller General.
1987--Pub. L. 100-119 amended section generally, designating
existing provisions as par. (1), substituting ``(or December 15, 1987,
in the case of the fiscal year 1988)'' for ``(or on or before April 1,
1986, in the case of the fiscal year 1986)'', and adding pars. (2) and
(3).
Section Referred to in Other Sections
This section is referred to in sections 901, 902, 904, 906, 907,
907d of this title.
