[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 404 Referral Instructions Senate (RIS)]







105th CONGRESS
  1st Session
                                 S. 404

 To modify the budget process to provide for separate budget treatment 
   of the dedicated tax revenues deposited in the Highway Trust Fund.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 5, 1997

Mr. Bond (for himself, Mr. Chafee, Mr. Nickles, Mr. Cochran, Mr. Gregg, 
 and Mr. Smith of New Hampshire) introduced the following bill; which 
was read twice and referred jointly pursuant to the order of August 4, 
1977, as modified by the order of April 11, 1986, to the Committees on 
  the Budget and Governmental Affairs, with instructions that if one 
committee reports, the other committee have thirty days to report or be 
                               discharged

_______________________________________________________________________

                                 A BILL


 
 To modify the budget process to provide for separate budget treatment 
   of the dedicated tax revenues deposited in the Highway Trust Fund.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Highway Trust Fund Integrity Act of 
1997''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1)(A) the Budget Enforcement Act of 1990 split the Federal 
        budgeting process into two budget categories, one for receipts 
        and mandatory spending and the other for discretionary 
        spending; and
            (B) each budget category has its own rules, procedures, and 
        incentives;
            (2) the taxes deposited into the Highway Trust Fund are in 
        the mandatory category, but most spending from the Highway 
        Trust Fund is in the discretionary category;
            (3) since the Highway Trust Fund is split between the two 
        budget categories, the link between Highway Trust Fund taxes 
        and transportation spending is severed; and
            (4) to reestablish the link between the taxes and spending 
        of the Highway Trust Fund, all the components of the Highway 
        Trust Fund should be part of the same budget category and 
        subject to the same budget rules and procedures.

SEC. 3. DEFINITION.

    (a) Balanced Budget and Emergency Deficit Control Act of 1985.--
Section 250(c) of the Balanced Budget and Emergency Deficit Control Act 
of 1985 (2 U.S.C. 900(c)) is amended by adding at the end the 
following:
            ``(22) Revenue constrained fund.--The term `revenue 
        constrained fund'--
                    ``(A) means the budget authority, outlays, and 
                receipts of the--
                            ``(i) the Highway Account of the Highway 
                        Trust Fund as established by section 9503 of 
                        the Internal Revenue Code of 1986;
                    ``(B) shall not be--
                            ``(i) considered to be part of any category 
                        (as defined in section 250(c)(4) of the 
                        Balanced Budget and Emergency Deficit Control 
                        Act of 1985 (2 U.S.C. 900(c)(4))) of 
                        discretionary appropriations; or
                            ``(ii) subject to sequestration under 
                        section 251(a) of the Act (2 U.S.C. 901(a)); 
                        and
                    ``(C) shall not be--
                            ``(i) considered to be part of direct 
                        spending (as defined in section 250(c)(8) of 
                        the Balanced Budget and Emergency Deficit 
                        Control Act of 1985 (2 U.S.C. 900(c)(8))); or
                            ``(ii) subject to sequestration under 
                        section 252(b) of the Act (2 U.S.C. 902(b)).''.
    (b) Congressional Budget Act of 1974.--Section 3 of the 
Congressional Budget Act of 1974 (2 U.S.C. 622) is amended by adding at 
the end thereof the following:
            ``(11) Revenue constrained fund.--The term `revenue 
        constrained fund' has the meaning given that term in section 
        250(c) of the Balanced Budget and Emergency Deficit Control Act 
        of 1985 (2 U.S.C. 900(c)).''.

SEC. 4. BUDGETARY TREATMENT.

    (a) In General.--Part A of title IV of the Congressional Budget Act 
of 1974 (2 U.S.C. 651 et seq.) is amended by adding at the end the 
following:

                      ``revenue constrained funds

    ``Sec. 408. It shall not be in order in either the House of 
Representatives or the Senate to consider any bill, joint resolution, 
amendment, motion, conference report, or other measure if the effect of 
the measure would have the effect of increasing any specific new budget 
authority for a fiscal year for a revenue constrained fund above the 
amount made available by section 251B(b)(2) of the Balanced Budget and 
Emergency Deficit Control Act of 1985.''.
    (b) Point of Order.--Subsections (c) and (d) of section 904 of the 
Congressional Budget Act of 1974 are each amended by inserting after 
``306,'' the following: ``408,''.
    (c) Amendment to Table of Contents.--The table of contents for the 
Congressional Budget Impoundment Control Act of 1974 is amended by 
adding at the end of title IV the following:

``Sec. 408. Revenue constrained funds.''.

SEC. 5. SEQUESTER.

    (a) In General.--Part C of the Balanced Budget and Emergency 
Deficit Control Act of 1985 (2 U.S.C. 900 et seq.) is amended by 
inserting after section 251A the following:

``SEC. 251B. SEQUESTRATION WITH RESPECT TO REVENUE CONSTRAINED FUNDS.

    ``(a) Budget Authority Limits.--Amounts available from a revenue 
constrained fund shall be reduced by the amount necessary to eliminate 
any amount by which budget authority in the budget year from the 
revenue constrained fund exceed the amount deposited in the revenue 
constrained fund in the previous fiscal year.
    ``(b) Amount Available.--
            ``(1) Initial estimate.--
                    ``(A) In general.--On October 1 of each year OMB 
                shall estimate the total amount of revenues deposited 
                into each revenue constrained fund during the previous 
                fiscal year.
                    ``(B) Initial amount available.--An amount equal to 
                40 percent of the total amount of revenues is estimated 
                to be deposited in a revenue constrained fund under 
                subparagraph (A) shall be available for obligation in 
                the budget year on the date of the estimate under 
                subparagraph (A).
            ``(2) Final estimate.--
                    ``(A) In general.--On December 15 of each year OMB 
                shall determine the total amount of revenues deposited 
                into each revenue constrained fund during the previous 
                fiscal year.
                    ``(B) Amount available.--An amount equal to the 
                total amount of revenues determined to be deposited in 
                a revenue constrained fund under subparagraph (A)--
                            ``(i) shall be the total amount available 
                        for obligation in the budget year on the date 
                        of the determination under subparagraph (A); 
                        and
                            ``(ii) shall replace the amount made 
                        available under paragraph (1).
    ``(c) Look-Back.--If--
            ``(1) an appropriation for the fiscal year in progress is 
        enacted that causes a budgetary excess in a revenue constrained 
        fund as described in subsection (a) for that year; or
            ``(2) errors in the determination made pursuant to 
        subsection (b)(2) cause a budgetary excess in a revenue 
        constrained fund for the fiscal year in progress;
the level set forth in subsection (b)(2) for the next fiscal year shall 
be reduced by the amount of that excess.''.
    (b) Amendment to Table of Contents.--The table of contents for the 
Balanced Budget and Emergency Deficit Control Act of 1985 is amended by 
adding after the item for section 251A the following:

``Sec. 251B. Sequestration with respect to revenue constrained 
                            funds.''.

SEC. 5. BUDGETARY IMPACT.

    (a) Findings and Purpose.--
            (1) Findings.--The Congress finds that--
                    (A) the United States has substantial surface 
                transportation and infrastructure needs; and
                    (B) this Act will result in additional spending 
                from the Highway Account of the Highway Trust Fund to 
                help address these substantial needs.
            (2) Purpose.--The purpose of this section is to clarify 
        that any budgetary offset necessary because of the additional 
        spending provided by this Act should not come from surface 
        transportation programs.
    (b) Sequestration.--The budgetary impact of the amendments made by 
this Act shall not be considered for purposes of sequestration under 
sections 251 or 252 of the Balanced Budget and Emergency Deficit 
Control Act of 1985 (2 U.S.C. 901, 902).
    (c) Discretionary Spending Limitations.--OMB shall reduce 
discretionary spending limits for budget authority and outlays in 
accordance with the Balanced Budget and Emergency Deficit Control Act 
of 1985 for each applicable fiscal year set forth in section 
601(a)(2)--
            (1) for budget authority, by an amount equal to the total 
        amount of discretionary budget authority provided from the 
        Highway Account of the Highway Trust Fund in the Department of 
        Transportation and Related Agencies Appropriations Act, 1997; 
        and
            (2) for outlays, by an amount equal to an estimate of the 
        amount of discretionary outlays that would be expended from the 
        Highway Account of the Highway Trust Fund assuming that the 
        total amount of new budget authority and obligation authority 
        from the Highway Account of the Highway Trust Fund equaled the 
        amounts of new budget authority and obligation authority 
        provided from the Highway Account of the Highway Trust Fund in 
        the Department of Transportation and Related Agencies 
        Appropriations Act, 1997.

SEC. 6. STUDY TO ENSURE THAT THE HIGHWAY TRUST FUND IS DEFICIT NEUTRAL.

    (a) Findings.--The Congress finds the following:
            (1) It is the policy of the United States Government that 
        the Highway Trust Fund should not contribute to or reduce the 
        Federal Government's annual budget deficit.
            (2) Under current budgetary scorekeeping conventions used 
        by both the Congressional Budget Office and the Office of 
        Management and Budget, increases in Highway Trust Fund revenue 
        generated by tax increases are partially offset by a reduction 
        in other Federal revenues that is equal to 25 percent of the 
        increase in Highway Trust Fund revenue.
            (3) This 25 percent offset is a scorekeeping convention 
        that applies to all excise taxes, and is not uniquely applied 
        to Highway Trust Fund taxes.
            (4) An up-to-date examination of how this offset should be 
        applied to Highway Trust Fund taxes is needed.
    (b) Report.--
            (1) In general.--Not later than 24 months after the date of 
        enactment of this Act, the Secretary of Treasury, in 
        consultation with the Director of the Office of Management and 
        Budget, shall submit a report to Congress on ensuring the 
        deficit neutrality of the Highway Trust Fund.
            (2) Contents.--In the report, the Secretary shall--
                    (A) determine the extent to which each of the taxes 
                deposited into the Highway Trust Fund is a deductible 
                expense from other Federal taxes;
                    (B) provide an estimate of the amount of Highway 
                Trust Fund taxes that were deducted from Federal income 
                taxes or other taxes;
                    (C) provide an estimate of the annual revenue loss 
                because Highway Trust Fund taxes are deductible from 
                other Federal taxes;
                    (D) determine the appropriate scorekeeping 
                convention that should apply to Highway Trust Fund 
                taxes, or if needed, separately to each of the taxes 
                now deposited into the Highway Trust Fund; and
                    (E) provide the Congress with policy options that 
                would ensure that changes to the Highway Trust Fund 
                taxes do not contribute to the deficit.
                                 <all>